Home Authors Posts by Thomas Hickey

Thomas Hickey

0 0

Chartis has today announced it made a reinsurance deal worth USD 575 million with Compas Re to cover US hurricanes and earthquakes.

The deal, which was finalised on December 1 2011, was a substantial increase from the USD 275 million agreement originally sought by Chartis.

As part of the agreement, Compas Re will cover Chartis in the event of US hurricanes and earthquakes on a per-occurrence basis until December of 2014.

The previous deal Chartis had for this type of protection was with Lodestone Re. In that deal, Lodestone Re provided a total of USD 875 million of protection to Chartis.

Peter Hancock, Chartic CEO, said, “We are pleased to be able to again obtain reinsurance … to efficiently supplement and diversify Chartis’ risk management framework.”

0 0

A late start to winter has lulled many Brits into a false sense of security about the weather ahead, with 40 per cent of people yet to do anything to prepare their homes for the cold, a Direct Line Insurance study has revealed.

The research reveals that 40 per cent of homes will be unprepared and vulnerable to issues such as frozen pipes and boiler breakdowns if sever weatherwere to hit tomorrow, because people have not taken measures to protect their property.

Despite last year being the coldest on record, with an average temperature of just -1°C2, people have left their preparation to the last minute.

Last year an estimated 3 million Brits were victims of damaged property as a result of freezing temperatures. The most common claims were damaged roofs and frozen or burst pipes.

Stuart Curson, head of Direct Line Insurance, says while this winter has proved mild so far, “it is important to be prepared for severe weather should it occur later on.

“In addition to checking that your insurance covers the cost of emergencies, taking a few simple actions such as lagging pipes and keeping your home well maintained will go a long way to limiting the damage winter weather might cause.”

Direct Line offered a number of ideas to ensure your home is safe this winter:

– Prepare pipes for icy weather by insulating them with lagging. Don’t forget the corners. You can do those bits by cutting a 45-degree angle in the lagging, and remember to cover all of the joints with duct tape. Make sure you’ve lagged any pipes you might have outside.

– Check to make sure your loft insulation is thick enough. It should be around 10 inches deep.

– Find your main stopcock and make sure that you can turn it on and off.

– If you have any taps that have a tendency to drip, now’s the time to fix them. Also check to make sure your boiler has been serviced by a Gas Safe professional.

– Try and insulate your home – fit draught proofing to any gaps in windows or doors and make sure wall cavities are well insulated.

– If you’re away from home for a few days during the cold weather, keep your heating on at a low level – at about 15°C – throughout. Open the loft hatch to allow the hot air to circulate.

– If you’re away for a longer period of time it might be wise and more cost-effective to shut down the system completely, turn off all the mains stopcocks and drain down pipes, toilets and radiators.

– If your pipes do freeze, turn the water off, drain the system and leave the taps open.

– A good way to thaw out frozen pipes is to carefully use a hairdryer (if safe to do so) or to use a hot water bottle tied to the pipes with a towel. You should start from the end nearest to the tap, which should be open. If you’ve found a leak, put something underneath to collect water. Never use a naked flame, such as a blow torch, to thaw your pipes as this could cause some serious damage.

0 0

As the waters in Thailand begin to recede, the cost for insurers is becoming more clear. Swiss Re has estimated that floods, which caused hundreds of deaths and damaged approximately 1500 industrial facilities, will cause a market loss of USD 8 to 10 billion.

Water levels still remain high in some areas though, making it difficult for an accurate estimation.

Since July, Thailand has experienced it’s highest rainfall in 50 years. More than 600 people have died and millions of tons of crops have been destroyed.

“In addition to the human cost, the impact of this flood on the Thai economy and the companies that operate there is likely to be significant and could last some time,” says Swiss Re’s Chief Underwriting Officer Brian Gray.

“The floods have forced the closure of several major industrial estates. For weeks, factories were under several metres of water and have been unable to produce and supply key parts to global car-makers or digital and electrical goods manufacturers.”

Thailand is an important link in the global manufacturing industry and is the world’s second largest producer of hard disk drives for computers.

The total insured exposure in these industrial estates is estimated by the Thai Office of Insurance Commission at USD 20 billion.

Only about one percent of homeowners and small businesses in Thailand buy flood insurance. Flood losses for most industrial and large commercial risks are covered by all-risk insurance.

Swiss Re currently estimates the total insured market loss to be in the range of USD 8 to 11 billion. Water levels are now receding but remain high in some areas of Thailand, so it will be difficult to make an accurate estimation for some time, Swiss Re said.

0 1

Aon Benfield has published a new report which explores the opportunities and challenges insurers may face when formulating strategies in China.

The report, titled the China Property & Casualty Insurance and Reinsurance Market Report, looks at the reasons for the slow development of catastrophe insurance and reinsurance despite China’s increasing natural hazards exposures.

The key developments in the Chinese insurance and reinsurance market, highlighted in the report, include:

– China represents close to 4 per cent of the world’s total insurance premiums at RMB1.45tn (USD226bn) for Life and Property and Casualty, which has grown from 1 per cent over the last decade. Industry experts in China are targeting a 15 per cent compound annual growth rate over the next five years

– The Chinese Property and Casualty market outpaced gross domestic profit expansion for the ten years to 2010, growing to RMB402bn (USD59.0bn), a compound annual growth rate of 20 percent

– Government subsidies have supported annual growth in Agriculture premiums of greater than 100 percent from 2005 to 2010 to reach RMB13.6bn (USD2.0bn)

– Aggregate reinsurance premiums ceded by Chinese Property and Casualty insurers in 2010 were RMB44bn (USD6.5bn), and have expanded by 67 per cent since 2005

In terms of perils, China has suffered five of the top ten deadliest natural disasters in history, with recent events affecting over 70 percent of China’s land area and more than half the population.

Regardless of this, Henry To, CEO of Aon Benfield for China, says they are standing by China as a lucrative market for insurance.

“Over the years from 2001 to 2010, the Chinese insurance market was the second fastest growing national market in the world and now represents close to 4 percent of the world’s total insurance premiums – up from about 1 percent in 2001

“Given the still low insurance penetration rate and China’s comparative economic outlook, this share can only be expected to grow. Aon Benfield is committed to the Chinese market and strives to bring global expertise and capacity to facilitate the development of our clients and the general market.”

Aon Belfield’s confidence could stem from the China Insurance Regulatory Commissions latest five year plan, which includes the creation of a national natural disaster risk transfer program, as well as the improvement of loss models and underlying data which could lead to a spike in the purchasing of catastrophe insurance and reinsurance.

0 0

25 per cent of office insurance can now be bought directly online, but this may mean that some businesses are buying the wrong cover, Defaqto says.

Defaqto, an independent research company, says the convenience of buying insurance online can sometimes be a bad thing because too much onus is put on the price of premium rather than the cover itself.

“The number of office insurance policies now available online makes it easier for a business to obtain cover,” Mike Powell, Defaqto’s Insight Analyst for General Insurance said.

“While this is a good development in many ways, if firms purchase online without fully understanding what policies offer and whether the cover they arrange matches their requirements there is a real danger that they could end up with insufficient insurance. This issue is even more acute given the potentially huge financial implications that could result from a business being under-insured”

In their research, Defaqto found that of the 53 office insurance policies currently on the market, 13 could be purchased directly through the internet.

“If a business chooses to arrange their commercial insurance online without advice, they need to place an even greater emphasis on the features and benefits that policies offer when comparing the options,” Powell continued.

“Although important, the premium should not be the primary consideration – given the potential risks involved in an office environment, trying to reduce business costs by cutting corners on insurance could end being the most expensive mistake a business makes”

Some of Defaqto’s findings include:

Business Contents cover 

– 83 per cent of policies will cover the contents of an office as standard, with 7 per cent of policies including cover on an optional basis

– 81 per cent of policies cover contents against ‘all risks’ as standard (including accidental loss, destruction or damage of contents for example), while the remainder provide cover on a ‘specified perils’ basis to protect businesses against a more limited range of risks

Business interruption cover

– 55 per cent of policies provide cover for the loss of income and expenditure incurred by a firm if business were to be interrupted due to an insured risk (for example, if there was a fire which meant that trading at the premises could not continue) as a standard policy benefit – 42 per cent only offer this cover as an optional feature

– The maximum sum insured available for business interruption cover can vary from a specific monetary limit to a selected sum insured requested by the policyholder. Where a specific monetary limit is provided this can range from £100,000 to £2,000,000

– Where supplier-related issues cause business interruption, the cover offered can be based on a specific monetary limit or a percentage of the overall business interruption sum insured. Where a monetary limit is specified the maximum level of cover provided ranges from £10,000-£500,000

Public liability

– In terms of the standard level of cover offered by policies, 8 per cent cover a business’s legal liability for loss or damage to property or physical injury to the public for £1,000,000, whereas 85 per cent provide cover of £2,000,000; only 6 per cent offer cover of more than £2,000,000

Money cover

– 93 per cent of policies provide cover for the loss or theft of money as a standard feature

– Where policies include this feature, the standard level of cover available for money on the premises or in transit ranges from £500-£7,500; and standard level of cover offered for money held in a safe ranges from £500-£5,000

– In terms of the maximum level of cover provided by policies for money cover, 34 per cent of policies allow businesses to select the amount cover they require; where a specific limit is stated within policies, this ranges from £1,500-£12,000 for money on the premises or in transit and from £500-£12,000 for money kept in a safe

0 0

Ever felt like you’re wasting your time sitting in traffic? A new study by Churchill Car Insurance shows just how right you are, revealing over 123 million working hours lost each year due to workers arriving late due to traffic.

The study showed that half of the people who drive to work arrive earlier and leave later, simply to avoid the traffic rush.

But with more than one in 10 of those who drive to work reporting that they are at least 40 minutes late every time they are stuck in traffic, it is estimated that the UK economy loses at least £752 million a year as a result of the gridlock.

Tony Chilcott, Head of Churchill Car Insurance, says “it’s increasingly frustrating for motorists to have to adapt their working hours just to avoid congestion on the roads.

“However, many drivers have to accommodate the school run and other commitments in the mornings, so it’s simply unrealistic to leave work at the crack of dawn”

The average motorist is delayed by 27 minutes at least once a month, which doubles their usual 30 minute journey time. Consequently, those who drive to work are being forced to change their daily routines.

The traditional nine to five is now seemingly a thing of the past, as over half of motorists (51 per cent) arrive at work before 8.30am. For an unfortunate one in five (21 per cent) drivers, the day in the office starts between 5.15am and 7.30am in attempt to beat the traffic.

As well as the early starts, traffic worries result in one in eight (12 per cent) employees working longer hours purely to avoid traffic. A further one in six (15 per cent) say they have been forced to shift their working hours just to avoid driving on congested roads.

It would appear that traffic congestion is not just increasing motorists’ workloads, but raising their blood pressure as well. Daily delays cause drivers to worry on the way to work, with one in five (19 per cent) of those who drive to work arriving stressed because of their journey.

Despite the pitfalls of the daily commute, millions of motorists say they have no choice but to brave the roads as, for one in three (30 per cent) workers, there is no feasible alternative form of transport.