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John Stewart

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Not satisfied with completing the recent London to Paris Charity Bike Ride arranged by Lloyds of London; Peter Oakes, Head of Fraud at Hill Dickinson, has committed to raising £10,000 for The Christie Charity’s ‘On the Road to Recovery’ campaign.  The Christie is one of Europe’s leading cancer treatment centres and funds raised by the campaign will be used to buy a mobile chemotherapy unit, enabling patients in the North West region to be treated closer to home.   

This September, Peter will cycle five stages of the famous Tour de France in five days.  A feat of physical and mental endurance, he will cover over 100km each day to complete a course that includes L’Alpe D’Huez and Mont Ventoux.

Commenting on the challenge Peter said: “I’ve no doubt it’s going to be a gruelling five days, but put in context, nowhere near as daunting as a cancer diagnosis and the challenge of enduring chemotherapy treatment.  I’m delighted to be taking part in this extremely worthwhile fund raising activity – training starts again now.  If you would like to support me in raising money to fund the mobile chemotherapy unit please visit  http://ow.ly/lSy0W  Thanks in advance for your help.”

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International (re)insurance broker UIB is planning a renewed assault on the UK solicitors’ professional indemnity (PI) market after re-signing a binding authority capacity deal with legal specialist Elite Insurance Company for a further year.

UIB is one of the few brokers in the market to have its own capacity available directly for clients and the renewed deal builds on the success of UIB’s original one year agreement with Elite. As the Solicitors’ PI market is changing, particularly the abolition of a compulsory annual renewal date from 1 October 2013, UIB is currently working with Elite to develop new products to provide greater flexibility and affordability for UK law firms, with the first product expected to be announced in time for this year’s renewal period.

As part of Elite’s rapid expansion, it recently rejoined the Association of British Insurers and plans are in place for Elite to obtain a financial rating from a leading rating agency later this year to give better client confidence in its capabilities.

UIB PI specialist Simon Lovat said: “We are very pleased to be extending and broadening our relationship with Elite, particularly at a time when the solicitors’ PI market is undergoing change. Elite is an ideal partner as it is robust and flexible enough to cater for a broad range of firms and product development is currently underway to bring some much needed fresh thinking to a changing market.”

Jason Smart, chief executive of Elite said: “UIB is the natural choice for Elite following our successful launch into the England & Wales Solicitors PI market with the UIB team last year, after many years providing ATE insurance to the solicitors market. The binding authority arrangement has proven to work extremely well for both parties and we intend to build on that by innovating to give solicitors greater choice in how they access the PI insurance that they need.”

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Sterling Insurance Group has promoted Kevin Duncan to the role of Technical Claims Manager, Property and Liability Claims.

In this new role Kevin will be responsible for ensuring that Sterling Insurance continues to deliver on its commitment to providing a first-class claims service. He will report directly into Garry Simmons, Head of Property and Liability Claims at Sterling Insurance who says:

“Our company’s stated aim is to deliver complete customer and client satisfaction and nowhere is this more important than with our claims handling. Kevin has considerable experience of claims across the board from household and liability property claims to commercial property and subsidence. His promotion is well deserved and further testament to the fact that we are committed to delivering on our customer promise.”

Kevin joined Sterling Insurance five years ago as a technical controller in the property and liability claims team having spent over 30 years as a loss adjuster at firms including Crawfords, Woodgate & Clark and GAB Robins.

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Impact Forecasting releases the latest edition of its monthly Global Catastrophe Recap report, which reviews the natural disaster perils that occurred worldwide during May 2013.

The report reveals that regions of the United States were impacted by several severe windstorm events during the month, including Moore, Oklahoma, where a catastrophic EF-5 tornado killed 24 people, injured 387 others, and damaged or destroyed up to 13,000 homes and structures.

Total economic losses from the event, which comprised at least 61 confirmed tornado touchdowns, were preliminarily estimated at USD5.0 billion, amid insured losses of at least USD2.5 billion.

In a second prolonged severe weather event at least 76 tornadoes touched down, including an EF-5 tornado with 295 mph (475 kph) winds and a U.S.-record 2.6-mile (4.2-kilometer) path width that struck El Reno, Oklahoma. Large hail (including a major hailstorm in Amarillo, Texas that resulted in a USD400 million insured loss), flash flooding in the Plains and Midwest, and damaging winds in the Northeast were also recorded.

Total economic losses are expected to exceed USD2.0 billion, with insured losses above USD1.0 billion.

Two additional stretches of severe weather also affected parts of the Plains and the Southeast, causing a combined economic loss of USD700 million and insured losses of USD375 million.

Steve Jakubowski, President of Impact Forecasting, said: “The month of May is historically the peak of tornado season in the U.S., and after a relatively benign start to the month, tornado activity became much more prevalent during the last two weeks.  Images from the aftermath of the EF-5 tornado in Moore, Oklahoma show the destructive power of the peril and how devastating impacts can be when tornadoes of such magnitude track through densely populated areas. High insurance penetration will help to alleviate the pressure on those affected, and the recovery is already well underway.”

Severe weather was also noted in parts of Europe during May, where three tornadoes struck northern Italy’s Emilia Romagna region, injuring at least 20 people, and damaging hundreds of homes were damaged in the Bologna and Modena regions. Total economic losses were estimated at EUR10 million (USD13.1 million).

In Russia, an F2 tornado struck the town of Yefremov injuring at least 20 people and resulting in a total economic loss of RUB100 million (USD3.2 million).

Extensive flooding killed at least 11 people in Central Europe, with the most significant damage occurring in the Czech Republic, Germany, Austria, Slovakia, Poland, Hungary and Switzerland. Several major rivers and their tributaries burst their banks, including the Danube, Vltava, and Rhine, as thousands of homes, structures and vehicles were damaged. The event remains ongoing during the first week of June. Total economic losses were anticipated to reach billions of dollars (USD).

Meanwhile, heavy rainfall and strong thunderstorms swept across much of central and southern China during the month, with at least four separate periods of inclement weather were noted.

According to data from the Ministry of Civil Affairs (MCA), 98 people were killed, 171,000 homes damaged or destroyed, as well as 600,000 hectares (1.48 million acres) of crops. Total economic losses were listed at CNY12.3 billion (USD2.0 billion).

Flood events were also recorded in the United States, Canada, Maldives and Uganda.

Significant drought conditions persisted in Brazil, resulting in the country’s worst drought since 1963, affecting the northeastern states of Minas Gerias, Pernambuco and Bahia. According to Ministry of National Integration, more than 50% of the region’s cattle died and agricultural crops were devastated. The Brazilian government allocated BRL16.6 billion (USD8.3 billion) in aid and recovery.

Drought conditions were also recorded in New Zealand and Panama.

Elsewhere, Tropical Cyclone Mahasen made landfall in Bangladesh, killing 52 people, after causing flooding in parts of Sri Lanka, India, and Myanmar. In Bangladesh, at least 136,132 poorly constructed homes were destroyed by the storm, resulting in economic losses to crops and fisheries listed at BDT15.61 billion (USD200 million).

Hurricane Barbara made landfall in southern Mexico’s state of Chiapas, killing at least four people. More than 5,000 homes and other structures were damaged by floodwaters up to 6.0 feet (1.8 meters) in height.

To view the full Impact Forecasting May 2013 Global Catastrophe Recap report, please follow the link below:

http://thoughtleadership.aonbenfield.com/Documents/20130604_if_may_global_recap.pdf

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According to catastrophe modeling firm AIR Worldwide, Central Europe has been inundated during the past several weeks with heavy and relentless rain, which has resulted in some of the worst floods seen in the area in more than 70 years. The floods have reached record levels, particularly in Germany, Austria, and the Czech Republic. Switzerland, Hungary, Slovakia, and Poland are also affected. The heavy rains are resulting in landslides in many mountainous areas, while in the floodplains, which were already saturated due to rains in previous weeks, river levels rose to record heights.

According to AIR, Germany is the hardest hit country, with some flood levels reaching the highest in recorded history. Water levels in Passau, which is located at the intersection of the Danube, Inn, and Ilz rivers, are at the highest on record since 1501. Electricity has been shut off and rescuers are using boats to evacuate residents. The river gauges along the Danube have been knocked out. Other cities in south and southeastern Germany are preparing for the worst as the Danube and Inn rivers continue to rise. Dangerous flood levels in Germany have also affected Saxony, Thuringia, and Baden-Württemberg. Severe water levels are reported in the cities of Rosenheim, Dresden, Zwickau, and other areas.

In Austria, rising waters in the Danube are threating the cities of Linz and Melk and floods have already reached some historic city centers. Flood alerts are in effect in the western provinces of Vorarlberg, Tyrol and Salzburg, as well as northern parts of Upper Austria. Flooding in Tyrol and Styria is considered the worst in the area since 2002.

Flood warnings in the Czech Republic are in effect for 40 cities, including Prague where the Vltava River is reaching critical levels while the Moldau River is threatening the city’s historic center. A state of emergency has been declared in Prague and other areas including South and Central Bohemia, Plzeň,  Liberec, Hradec Králové and Ústí. The Upa and Berounka rivers are also threatening several locations.

According to AIR, the heavy persistent rains are the result of a low pressure system called a Genoa Low Cyclogenesis, which developed over the eastern Adriatic Sea. From there it moved northwards towards the Eastern Alps bringing with it warm, moist air from the Black Sea. As this warm air mass collided with the colder air masses over northern Europe, it was lifted up and rain clouds developed. The system, named Frederik, remained over Central Europe for several days due to a very stable track but has now moved on towards southeast Europe.

According to AIR, the event has released an enormous amount of precipitation—in some areas as much as 400 liters per square meter within a few days. In Aschau-Stein, the precipitation rate reached 405 liters per square meter within 90 hours. Over the past 24 hours, over 90mm of rain has fallen in areas around Salzburg, Austria. In Germany, 61 river gauges (mostly in Bavaria, Thuringen, and Sachsen) are showing levels above their highest flood warning levels. While the gauges along the Danube in Passau are inoperable, the flood waters have reached 12m, which is above the historical high set in 1954. Several tributaries are rising above the 100-year water level.

Saxony has received over 30mm of rain in the past 24 hours. The Elbe River has risen from its normal summer level of about 2m to 9.16m, well surpassing the 8.77m record of 1845, and is still rising rapidly. Flood levels at Blankenstein-Rosenthal are also rising, although the rain has abated.

This disaster has caused tens of thousands to evacuate their homes. Disruptions to infrastructure include flooded and blocked roads, and train tracks, along with power outages, and has hampered rescue efforts.

Southeastern Germany, particularly Passau, has borne the brunt of the damage due to the confluence of the Danube, Inn, and Ilz rivers, which have overwhelmed this city. In eastern Germany, floodwaters have submerged towns located along the Elbe. About 30,000 people have been evacuated from several areas around Dresden.

According to AIR, the predominant construction type for single family homes in Europe is masonry and around 90% of the homes in the countries affected by this event are of masonry construction, with the remainder usually being wood; a few are reinforced concrete. As most of the homes are one-story buildings, floods can damage a significant percentage of the building and its contents. The presence of a cellar increases the risk for contents damage, although heavily-used cellars often have better flood defenses than unfinished ones.  In addition, apartment buildings in the affected regions are of masonry and reinforced concrete. Commercial buildings in all three of these countries are masonry or reinforced concrete, with masonry being the predominant type in Germany and Austria. Note that many buildings in Europe have mixed occupancies, with the ground floor used for shops while the upper floors are residential. Unlike single-family homes, these buildings often have a large degree of engineering and are built to stricter standards with sophisticated flood defenses, particularly in flood-prone areas.

The system’s track has moved into southeastern Europe. However, even as the rains abate, flooding will still worsen in areas as more water enters the river basins. The Elbe River is still rising and although rains have diminished in Saxony, the moist air will slow drying efforts. Landslides may continue to pose a threat due to the saturated ground and it will take several days for the floods to diminish.

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EC3/Legal, a City law firm focused on representing the intermediated insurance market, has launched a new real estate practice to support brokers, Lloyd’s agencies, MGAs and other support providers in the insurance sector.

Matthew White joins EC3/Legal to lead the practice which will provide legal services including advising and negotiating on leases, property acquisitions and disposal, and property finance matters.

White joins from Prettys Solicitors where he headed up the firm’s real estate team. He specialises in high value commercial leasing deals for both landlords and tenants.  He also has significant experience in investment portfolio acquisitions and disposals, property financing, site assembly and development. He has acted for several major insurance companies and intermediaries.

Matthew White said: “Property related matters represent a significant part of an intermediary’s operational and financial commitments. As a result, dealing effectively with the leasing or acquiring of premises, renegotiated leases or exiting and selling office space are business imperatives.

“The real estate practice has been established to respond to the demand for a commercially experience and responsive legal service to help insurance businesses address the potential cost and resourcing impacts of property related matters.”

The launch of the real estate practice is an important strategic development for the firm. David Coupe, Managing Partner of EC3/Legal, said: “The real estate practice is an important addition to our service provision. It directly complements our existing insurance work and reflects our commitment to providing clients with a relevant portfolio of legal services responding to the range of critical issues that insurance businesses face. “

Coupe continues: “We are continuing to build our business and will be establishing employment, compliance and litigation specialist practices during 2013.”

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The London Pensions Fund Authority has welcomed the findings of new research into local authority pension funds, which shows that LGPS funds could be paying hundreds of millions of pounds more than necessary to City fund managers.

The research into the 89 LGPS funds, conducted by the Daily Telegraph, found that council pension funds paid £347m to investment managers last year, up 9% on the 2011 figure. At the same time the funds themselves increased in value by just 4%. Local Government Minister Eric Pickles urged councils to bring down the overall number of schemes to help reduce fees.

The report was published at the same time as the Financial Times found that some LGPS funds were paying fund managers three times as much as other schemes of the same size.

Edi Truell, Chairman of the LPFA, commented: “These research papers further support our assertion that creating pension scheme ‘superpools’ of up to £50bn would result in markedly reduced fees for LGPS funds, improving net returns and helping to reduce deficits.

“In addition to delivering fee reductions, pooled funds would also have the resource to invest in a wider range of asset classes, as well as to pursue more complex liability-driven investment strategies, further driving returns. There is also huge savings potential in the administration of schemes.”

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According to catastrophe modeling firm AIR Worldwide, Hurricane Barbara, the second hurricane of the 2013 Pacific season, made landfall in the state of Chiapas on Mexico’s Pacific coast on Wednesday, May 29, at 12:50 p.m., local time (19:50 UTC), about 20 miles west of Tonala. It managed to reach hurricane status with 75 mph winds at 11 a.m., local time, on Wednesday, less than two hours before making landfall. According to the National Hurricane Center (NHC), Barbara was the easternmost East Pacific landfall since at least 1966, as well as the second earliest landfall in that period. AIR expects insured losses from this storm to be minimal as a result of Barbara’s relatively low wind speeds and because the storm made landfall in a sparsely populated stretch of the Mexican coast.

Mexico issued a hurricane warning for the Pacific coast from Puerto Angel to Barra de Tonala, and the ports of Puerto Angel, Puerto Escondido, and Huatulco have been closed to navigation. The storm was downgraded to a tropical depression at 2 a.m., local time (9:00 UTC), today, Thursday, May 30, and continues to weaken quickly. The Government of Mexico has discontinued all warnings. Barbara is moving northward over land at about 8 mph over the isthmus of Tehuantepec.

“Excessive rainfall and flooding have impacted some areas of southeastern Mexico,” said Dr. Tim Doggett, senior principal scientist, AIR Worldwide. “The storm’s slow forward speed is prolonging the duration of precipitation in many areas, allowing rainfall accumulations in excess of 6 to 10 inches. In locations in and around mountainous areas, upslope flow will enhance the precipitation rates, and localized areas may see accumulations of 15 to 20 inches. As much as 16 inches of rainfall has already been reported in Arriaga, Chiapas state. These high rainfall amounts will lead to localized flooding along rivers and low-lying areas. As Barbara moves northward and weakens, the precipitation will decline.”

The heavy rains have already flooded roads, toppled trees and power lines. Power outages in Oaxaca state have been reported, where evacuations were carried out as a precaution.

According to AIR, the predominant construction types for insured residential and commercial buildings are masonry and concrete, which have slab roofs resistant to uplift from winds. Most apartment buildings in Mexico are masonry, with the exception of high-rise apartments, which are generally made of reinforced concrete. Mexico has no national building code, and it is estimated that about half of all new homes are built without permits. Wind damage to engineered structures at Category 1 wind speeds is expected to be limited to cladding and roof coverings, but non-engineered structures will likely experience damage beyond cladding and roof coverings, including structural roof elements.

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According to figures announced yesterday by the Federation of Small Businesses (FSB), SMEs are now regularly falling victim to cyber crime, costing them nearly £800 million each year.  This highlights the ever changing nature of cyber risk faced by every size of business, says specialist underwriting agency CFC, and insurance brokers should take notice. 

Speaking about the FSB report, Graeme Newman, Director at CFC commented:  “It is great to see that for the first time the FSB has looked directly at the impact cyber crime has on small business.  After a number of high-profile attacks in recent years, larger businesses are beginning to better understand the risks they face from cyber criminals and are therefore taking more measures to protect themselves. Because of this, hackers, fraudsters and phishers are increasingly turning their attention towards smaller organisations.  Whilst the rewards might not be as high, SMEs are often less secure and less prepared in the event of an attack”.

According to the FSB report, 41 per cent of their members have been a victim of cyber crime in the last 12 months at an average cost of around £4,000 per business and around 3 in 10 have been a victim of fraud.  The most common threat to small businesses is virus infection, which 20 per cent of respondents said they have experienced.  Eight per cent had also been a victim of hacking and 5 per cent had suffered a security breach.

Newman continues: “The insurance industry has been slow to embrace and tackle head on the issue of cyber crime faced by every size of company in every sector of business.  Many insurers have built policies that are simply a carbon copy of those sold in the US and focussed primarily on privacy and data breach notification.  However, as highlighted by the FSB report, cyber crime is costing businesses millions of pounds every year.”

To bridge this glaring gap in the market, CFC launched a new cyber policy earlier this month. The policy, CPM, is a fully blended yet modular policy that can be tailored to the individual needs of companies of every size.  Features of the policy include comprehensive cyber crime cover, both first and third party privacy breach notification costs, and innovative business interruption cover which not only covers lost revenue during system downtime but also the loss of future revenue due to consequential reputational harm that could so easily bring a small business to its knees.  Also, unlike many cyber policies, CPM does not impose a retroactive date meaning that there is no restriction on when an event which gave rise to a claim occurred.

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Brandon Lewis, Minister for Local Government, issued a call for evidence on the future shape and size of local government pension funds.

Speaking at the National Association of Pensions Funds’ Local Authority Conference, Lewis questioned whether the existing structure of local authority pension schemes in the UK is fit for purpose. Today there are 89 funds in England and Wales administering schemes on behalf of some 4 million members and investing over £150 billion on their behalf.

The call from the Minister is strongly supported by the London Pensions Fund Authority (LPFA), one of 34 bodies administering pensions in London alone. LPFA has long supported pooled funds, citing significant potential savings in administration and fees, as well as improvements in investment returns from consolidating funds.

The benefits of scale of pooled funds are clear with academics, pensions professionals and advisers internationally citing huge potential savings. Lower fee rates would be accessible for externally managed investments due to larger investment mandates, and economies of scale in pensions administration. Estimates of additional investment returns range from 0.5% to 1% per annum, equating to up to £1.5bn of addition returns a year across local authorities in England and Wales. Savings would also be achieved from economies of scale by merging scheme administration, the maintenance of scheme member records and the payment of benefits.

In addition pooled funds allow for more sophisticated techniques and technology for hedging away risk including interest rate movement and inflation, while a larger pool of assets under management would improve the scope for a more diversified approach through investing in a wider range of asset classes. Larger funds have the resource to pursue more complex liability-driven investment strategies and increase the potential to invest in assets which link well to the long-term focus of pension funds, with better liability matching dynamics, such as infrastructure.  Many public sector funds are not effectively ensuring assets and liabilities run together, with assets falling more slowly than liabilities over time.

Academic publications have repeatedly highlighted the “governance dividend” attributed to larger schemes, having higher standards of expertise, advice and governance. In addition, creating superpools would open up the way to up to billions of pounds worth of housing and infrastructure investment across the UK, which might otherwise not take place, creating jobs, boosting local economies and improving the country’s infrastructure.

The Minister expects to make a decision around Christmas this year.

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According to catastrophe modeling firm AIR Worldwide, at 3:01 p.m. on Monday, May 20, 2013, a massive tornado struck Moore, Oklahoma, a suburb of Oklahoma City, destroying many homes, businesses, and public buildings, including two elementary schools and a hospital. According to reports and aerial images, property damage in the affected region is extensive, with whole neighborhoods heavily damaged or destroyed.

“A slow-moving upper level low pressure system triggered a series of severe thunderstorm outbreaks across the Central Plains starting on May 19,” said Dr. Tim Doggett, senior principal scientist, AIR Worldwide. “The system coupled with very warm, humid air moving northward out of the Gulf of Mexico ahead of a surface cold front and wind shear associated with an approaching increase in jet stream energy. Together, these factors produced the highly unstable atmospheric conditions that caused the Monday afternoon storms to rapidly evolve into tornadic supercell thunderstorms. The tornadoes spawned by these supercell events were long-lived due to the orientation of the track and the severity of the conditions, leaving behind long and wide swaths of damage.”

Touching down about 5 miles south of Newcastle, Oklahoma, at 2:56 p.m., the powerful tornado tracked northeast for 40 minutes, traveling approximately 20 miles. The Moore tornado has been upgraded to an EF-5 rating by the National Weather Service, based on damage reports that are consistent with wind speeds of over 200 miles per hour. Based on reports and the size of the storm’s swath of destruction, the tornado was approximately a mile wide.

At 2:40 p.m., the National Weather Service Storm Prediction Center (SPC) alerted the town of Moore that a tornado was imminent. At 2:56 p.m., five minutes before the tornado struck, the SPC upgraded its emergency tornado warning to include “heightened language,” stating that those in the path of the storm would be facing a life threatening situation and must take cover in a basement, storm shelter, or interior room. At 3:01 p.m., the tornado struck Moore and continued northeast, nearly paralleling Highway 37, eventually dissipating about 5 miles east of Moore.

Dr. Doggett continued, “In all, this system produced 22 tornadoes on May 20, largely in Oklahoma, although tornadoes were also reported in Missouri, Texas, Kansas, Arkansas, and Colorado. (However, of these 22 tornadoes, the Moore event was by far the most damaging.) Many localized hailstorms occurred in the region as well, with quarter-size hail noted in Missouri and baseball-size hail reported in Osage County, about 100 miles northeast of Oklahoma City.”

Although basements and underground shelters are the safest refuge from a tornado, many homes in Oklahoma are built on concrete slabs—and thus lack basements—because the soil in the region renders basement construction too costly.

Dr. Doggett noted, “An official estimate of the number of destroyed homes has not yet been released; however, the 1999 EF-5 tornado that followed a similar path to Monday’s EF-5 Moore tornado destroyed more than 8,000 homes.”

AIR estimates that the replacement value of properties within a 0.4-mile buffer zone around the track of yesterday’s tornado (for a total width of 0.8 miles) is about USD 2 billion. Within a 1-mile buffer zone of the storm track (for a total width of 2 miles), AIR estimates a total replacement value of about USD 6 billion. These two buffer zones, and the differing estimated replacement value associated with them, reflect the uncertainty in the exact size of the tornado.  However, it is important to note that the exposure within each buffer zone is not equally at risk from damaging winds. In fact, exposures on the periphery of the 1-mile buffer zone would experience wind speeds of F-0 force, and hence much lighter damage, than exposures within the 0.4-mile buffer zone.

According to AIR, residential structures in the affected area are typically of wood-frame construction, which are more vulnerable to high winds and windborne debris than masonry structures. Commercial buildings are, on average, less vulnerable than residential structures or automobiles, but exhibit a broader damage distribution due to wide variations in construction practices and design. Light metal structures are the most vulnerable to high winds and can suffer severe to complete damage from tornadoes categorized as EF-2 or higher.

According to AIR, for all types of structures, roofs are often the first element to be damaged by tornado winds, as once a single shingle is removed, neighboring shingles can easily be penetrated and lifted. Tornado winds can peel off unsecured slates, roll metal roofs, and damage windward overhangs and eaves. In the direct path of the tornado, failure of the roof system weakens lateral support of walls, contributing to their collapse. On the periphery of the track, lower damage ratios are expected.

Damage assessments from the National Weather Service are ongoing, and it will take weeks to develop a more complete picture of the destruction.

Dr. Doggett concluded, “The associated upper level system and the surface cold front will be slowly moving east and northeast over the next couple of days. Therefore, a wide area of the central United States — including parts of Texas (including the Dallas region), Missouri, Illinois, Indiana, and Pennsylvania—may be at risk for strong winds, hail, and tornadoes as the week progresses.”

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Pro Insurance Solutions has appointed Petra Wildemann to the position of global practice lead for Actuarial consultancy services.

Petra joins Pro with over 25 years of experience in the insurance industry, specialising in all aspects of actuarial consulting. She has a wide range of experience in insurance, notably with insurance processes and strategies, developing and implementing a number of software solutions for (re)insurance lines for life and non-life business. Prior to joining Pro, she was a member of the Executive Management at SunGard Insurance, where she was responsible for the actuarial consulting services for Life insurance on a world-wide basis.

At Pro, Petra will be responsible for all aspects of the global actuarial consulting practice, with a particular focus on supporting clients in Europe.  Petra will be based in Zurich.

Richard Lawson, CEO of Pro commented on Petra’s appointment: “I am very pleased that Petra has joined us at Pro. She brings a wealth of experience from her time at various insurance and consultancy businesses, significantly strengthening our actuarial services as we broaden our range of insurance services and global reach.”

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Clements Worldwide announces the launch of a Web-based marketplace, able to instantly deliver  insurance protection to all of United Nations Federal Credit Union’s (UNFCU) 100,000 members around the world.  Building upon a productive relationship between Clements and UNFCU, the new online marketplace provides members with direct access to a comprehensive suite of programs, including guaranteed-issuance life with no medical test, portable health care coverage, personal property and auto insurance, among other benefits.

Developed in direct response to the unique needs of the UNFCU membership, Clements’ Web-based marketplace serves as a timely solution to the insurance procurement challenges inherent to the international service experience. Today, many credit union members based outside of their home countries face unfavorable insurance options, as well as myriad issues ranging from high costs to insufficient coverage to poor service.  Clements estimates that as many as to 1.2 million international organization professionals working overseas may be either under-insured, or totally lacking much-needed, often mission-critical insurance coverage.

Addressing that critical gap and capitalizing on the strong member satisfaction record of UNFCU, Clements’ international portal now makes it easy, convenient, and affordable for their members to obtain personal and commercial coverage with preferential terms — anytime, anywhere – with just the click of a mouse.

“The humanitarian work of UNFCU’s membership exposes them to unique risks, especially those on field mission. By specifically tailoring our online marketplace for a highly mobile, global United Nations community, we developed an opportune solution that provides both vital insurance coverage and peace of mind,” said Dante Disparte, managing director of Partner Solutions at Clements Worldwide.

Stephen Ryerson, president, UNFCU Financial Advisors, adds: “The ability to offer members immediate access to economical, international and all inclusive insurance protection is in keeping with our focus on delivering outstanding service.”  A logical extension in Clements’ service of UNFCU members, the Web-based marketplace provides a turnkey solution similar to the card-based life insurance products. Introduced in 2011 and 2012, Clements’ credit and debit card-based life products now insure thousands of UNFCU members in more than 145 countries.

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As per 2012 the written premium of health insurance in the Cayman Islands valued US$196.3 million, growing at a CAGR of 8.7% since 2008. By 2017 this number is expected to grow to US$251.4 million, growing at a CAGR of 5.1%. Accounting for 30% of the total GDP the overall insurance industry in the Cayman Islands is a central part of the country’s financial sector. According to Timetric the recovery in the economy, evolving regulatory environment, availability of experienced work force combined with the low-cost advantage for running a business will drive the growth of the insurance industry towards 2017.

Introduction of new insurance law will support growth

In 2010 the Cayman Islands Monetary Authority (CIMA), revised the insurance law with the aim to strengthen the supervisory mechanism and create a better platform for the growth of insurance. In 2013 CIMA introduced a new regulation to the law allowing segregated portfolio insurers (SPC) to form one or more cell companies called portfolio insurance companies (PIC). This is expected to attract further investment in the insurance industry towards 2017.

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A new business guide has been launched online by UK Cloud and IT service provider, to help businesses in the insurance sector survive a potential disaster.

Managing costly power outages, IT failure, flooding and even terrorism are some of the potentially damaging scenarios examined in the ‘Would Your Business Survive?’ study produced by InTechnology.

Designed to provide a vital resource to businesses of all size in the insurance sector, the guide is free to download and offers advice on areas such as risk management and strategic business planning.

Research has shown UK businesses lose £2bn each year due to IT downtime and service failures, whilst £374m worth of fraud was committed by individuals against their employer – just some of the business risks tackled by the guide.

Stefan Haase, Product Director for InTechnology, said: “Our research underlines how businesses in the insurance sector need to prepare for the unexpected. There have been many high profile cases where firms have been badly impacted and have even not survived due to outside forces such as IT downtime caused by power outages that were never planned for.”

“Hopefully this guide provides the road map and strategic guidance for firms in the insurance sector to tackle a disaster and mitigate disruption – to ensure that business continuity can be maintained.”

Both the guide and the accompanying infographic can be downloaded for free at InTechnology.co.uk (http://www.intechnology.co.uk/business-continuity-guide)

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The Storm Prediction Center (SPC) reported that three tornadoes touched down west of Dallas-Fort Worth Wednesday evening. According to catastrophe modeling firm AIR Worldwide, the tornadoes affected Montague and Hood counties from the Red River southward to the town of Granbury and resulted in six fatalities in the Rancho Brazos neighborhood on the outskirts of Granbury. Most of the 120 homes in this neighborhood were destroyed by the storm.

“The tornadoes were produced by supercell thunderstorms, or highly organized severe thunderstorms with strong, long-lasting, and vertically rotating updrafts,” said Dr. Tim Doggett, senior principal scientist at AIR Worldwide.  “These storms formed in the central part of the state as a mid-level disturbance moving out of west Texas interacted with a plume of humid air moving out of the Gulf of Mexico. The dryline, or the boundary separating the humid plume from the dry west Texas air mass, triggered a cluster of thunderstorms in the late afternoon and evening, which moved eastward across the affected area.  With the presence of moderate-to-strong wind shear resulting from the mid-level low pressure system, the storms evolved into supercell thunderstorms.”

Granbury was among the hardest hit areas as homes were leveled and cars damaged. Trees were uprooted and power lines were downed along the paths of the tornadoes. In the town of Ennis, power was disrupted at about midnight, and several buildings in the downtown historic district were damaged.

Damage assessments from the National Weather Service are scheduled for this morning in Hood, Johnson, Montague and Parker Counties.

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AXA Assistance UK plans to build on its presence in the Broker market with their Motor Excess Protection product, which adds value to a Broker’s client base, by helping customers recoup their financial loss in the event of a claim.

Motor Excess Protection enables policyholders to insure against having to pay the Excess on their motor insurance in the event of a fault claim. The policy reimburses the Excess paid when the motor claim has been settled.

AXA Assistance provides Excess insurance on a white labeled basis to brokers, which can also be tailored to address specific customer propositions and product portfolios, providing a valuable addition to the range of add-on policies available to motorists.  Customers are able to select the level of excess they wish to protect, and in the event of a fault claim they will have their excess reimbursed, subject to the value of the claim being higher than the main policy excess.

Speaking at this year’s British Insurance Brokers’ Association (BIBA) Conference in London, Kelly Ward, Sales & Marketing Director at AXA Assistance, said: “We are committed to providing brokers with a robust and relevant product, supported by experienced underwriting and responsive customer service, all of which is backed by a trusted and financially strong brand.”

AXA Assistance has also developed a new, dedicated online claims management system to further enhance the product’s benefit to claimants. Ward explained: “Considerable investment has gone into making the customer journey as seamless as possible, with the development of a dynamic online claims system called ‘ClaimEz’, allowing customers to download documents, submit claims and ultimately ensuring a greater speed of Excess reimbursement.”

AXA Assistance has already experienced significant year-on-year growth since launching motor excess protection, with 500,000 policies after just two years of trading, and believes there are opportunities to maintain a strong level of growth going forward.

Ward said: “The Excess market provides significant growth opportunities. We have already seen exceptional growth and believe our Motor Excess Protection product will benefit brokers and their clients, and further strengthen our position.

“Furthermore, in difficult economic times this type of cover makes sense to consumers trying to reduce their financial commitments. Motor Excess Protection provides a cost-effective way to control the cost of insurance.”

The Motor Excess Protection product has evolved from car rental loss damage waiver policies offered on car hire contracts, which AXA Assistance has provided since 2001.

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Ageas Insurance Household Claims and Operations has been awarded the ServiceMark accreditation by the Institute of Customer Service (ICS), the professional body dedicated to leading customer service performance and professionalism in the UK.

ServiceMark, granted for the next three years, is the ICS’s most meticulous and thorough accreditation and means that Ageas now joins some of the most highly respected organisations in the UK providing commitment to world-class customer service.

Both household insurance customers and employees were surveyed by the ICS, the results of which recognise Ageas as providing ‘world-class’ customer service. This was followed by a rigorous three-day assessment, conducted by an independent assessor and involved 43 employee interviews and systematic analysis of written documentation and processes. The assessment team looked at eleven company characteristics including commitment, capability, consistency and professionalism as well as how easy it is to deal with Ageas.

Commenting on the accreditations, Andy Watson, CEO Ageas UK said: “We’re delighted to receive this accreditation and it signifies the tremendous focus our employees have placed on providing a world-class service to our customers. I’m particularly proud that the ICS specifically recognised that we are continually developing our products and services for our customers and have a trusting and supporting ethos engendered in our business. They identified our commitment to developing our people for the future.”

Jo Causon, chief executive of the Institute of Customer Service, added: “ServiceMark is increasingly recognised as the standard for customer service excellence. Over 100 organisations have completed or are working towards ServiceMark. It enables organisations to benchmark themselves against best practice, gain a better insight into their customers’ needs and develop strategies to meet them.”

Melanie Nash, Customer Services Manager, Ageas coordinated the assessment, said: “All of our people, whether they work with our brokers or partners like Age UK, focus on resolving issues at the first point of contact. In today’s market, excellent customer service can make all the difference to a customer’s perception of your product and business. We’re thrilled with this assessment.”

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Outsourcing and offshoring expert Professor Michael Mol believes retailers could use NGOs to report on working conditions at factories they are using in countries like Bangladesh.

European retailers, including Primark, Tesco Hennes and Mauritz, have said they will sign an accord to improve safety conditions in factories in Bangladesh after a factory collapsed, killing more than 1,100 people. The deadline to sign the Accord on Fire and Building Safety in Bangladesh is Wednesday May 15.

Warwick Business School Professor Michael Mol says there is no way back for the garment industry, and expects them to carry on outsourcing to countries like Bangladesh, but he believes they can do more to help improve working conditions.

Professor Mol, who is a Professor of Strategic Management at Warwick Business School, said: “One way out of this dilemma might be to give independent monitors, like NGOs, full access to assess the working conditions in these factories and to allow them to report this.

“But it is unclear whether such openness is on the agenda for these companies.

“These companies will continue to outsource activities to Bangladesh and similar countries, there is not really any way back for the garments industry now. So they must develop ways to deal with these problems.

“Incidents like this one are of course completely unacceptable.

“This type of outsourcing is still very much driven by the desire to reduce the costs of producing garments. But the UK and other western companies continuously underestimate the total costs of outsourcing activities, especially to countries like Bangladesh.

“We have seen other instances of this in the past with Nike and IKEA. There are hidden costs to outsourcing, in this case damage to their reputation that they fail to understand and predict.

“The complexities of their supply chains mean it is impossible to directly manage all these different suppliers. And even if they could do it, this would raise the costs so much that outsourcing would look a lot less attractive – it reintroduces all the bureaucracy they tried to get rid of when they outsourced activities in the first place.

“So at some point they end up just having to trust whoever they are doing business with.

“From an ethical point of view that is simply not good enough, because the people they trust may have other motives and they might not all have the same ethical standards that their western customers want from them.”

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SSP announced that it has renewed and extended its long-standing relationship with Swinton to provide IT solutions for its nationwide branch network, call-centre and web-based operations.

Under the terms of the new five-year agreement, insurance technology specialists SSP will provide Swinton’s personal lines broking systems alongside new technologies to support Swinton’s ambitious business plans.  In addition, Swinton will adopt SSP Quote Hub to enable it to enhance data enrichment at the point of quote and work with its insurer partners to deliver product innovation.

As well as providing access to SSP’s standard third-party data sources, SSP Quote Hub will enable Swinton to exploit its own data and other third party data to build its own sophisticated pricing models.

At the same time, the SSP Quote Hub solution allows Swinton to meet the needs of its insurer partners, allowing them to update their rates and products in real-time, improving their responsiveness and reducing their distribution costs. By validating and pricing risks more accurately the solution also reduces the incidence of application fraud, providing better loss ratios to insurers and reducing their cost of doing business with Swinton.

Ian Chapple, Chief Information Officer of Swinton, said: “I’m delighted to announce the extension of our relationship with SSP, continuing our highly successful partnership which dates back to the mid 1980s. Over the last few years SSP has been a vital technology partner within our overall IT strategy, supporting Swinton’s growth into a true multi-channel organisation and facilitating product diversification. SSP has an excellent track record of service, performance and innovation with us, and having them alongside Swinton for the next stage of our journey, with their outstanding industry experience and solution portfolio, is absolutely essential.

One of my key aims has been to look at our systems and evaluate how they best serve our current and future needs. Quick and cost effective access to a wide range of independently verified data sources is clearly essential in today’s market. We are looking forward to working closely with our insurer partners to fully realise the benefits of this industry leading technology, building upon the market leading position we’ve already secured in this area and allowing us to further differentiate our customer offering.”

Commenting on the agreement, Laurence Walker, Chief Executive of SSP, said: “We are delighted to have extended our long-standing relationship with Swinton.  Swinton has always been at the forefront of the industry, adopting innovative solutions to improve its efficiency and differentiate its service.  Since we launched SSP Quote Hub just over 12 months ago to provide links to third party data providers to validate and enrich quote data, we’ve seen an explosion in the use of data.  By adopting our industry leading hub Swinton will be able to further develop its use of data and sophisticated rating in conjunction with their insurer partners to deliver even better service to their customers.”