News
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Errors mount up |
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THE Medical Defence Union
(MDU), the largest indemnifier of UK doctors, has revealed that medication
errors account for a quarter of settled claims against GP members, costing £
12.5m ($22.7m) over a five-year period. The MDU said most of the errors leading
to claims could be avoided by putting measures into place such as reviewing
repeat prescribing, better monitoring of patients on long-term medication and ensuring
any adverse events that do occur are analysed and lessons learnt. |
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Safeco sells Talbot |
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SAFECO, the US insurer, has
completed the sale of its insurance brokerage Talbot Financial Group. The buyer
is an investor group led by Talbot Financial's senior management. |
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Brit notes get BBB- |
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AM Best has assigned a BBB-
rating to the $15m floating rate subordinated notes due in April 2034 issued by
Brit Insurance Holdings. The rating agency has also assigned an issuer credit
rating of BBB to Brit. Brit recently announced it was issuing the notes as a
significant potential new source of capital to take advantage of the hard
market (ID, Jun 30). AM Best said the outlook for both of the newly-issued
ratings is stable. |
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N&G appoints head |
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NAVIGATORS & General
(N&G), the Zurich-owned yacht and motorboat insurer, has appointed Richard
Coleman as its new head. Mr Coleman was founder of Woodstock Insurance Brokers
in 2002 and replaces Rod Daniel, who will move to the role of development
underwriting manager. Speaking about his appointment, Mr Coleman said: "I
am inheriting a real asset to the Zurich group, which is currently experiencing
the most successful period in its 82-year history. I intend to build on this
success and will investigate opportunities to expand the business, including
new products and markets." |
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S&P rates Tokio |
A LONG-TERM insurer financial
strength rating of A+ has been given to Tokio Marine & Fire Insurance
(Singapore) by Standard & Poor's (S&P). The agency said the rating is
based on the company's strong financial profile characterised by its stable
underwriting profitability, robust capitalisation and sound balance sheet
structure, as well as its solid franchise as one of the top three marine cargo
insurers in the Singapore non-life insurance market. S&P said it also
reflects the strategic importance of the company to the overall Millea Holdings
Group.
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News
in Brief |
ACE re-authorised |
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ACE INA UK, a member of the ACE
European group, has been re-authorised by the UK's finance regulator and given
an A+ financial strength rating by Standard & Poor's after it raised
capital of (£) 112.5m ($180m). It plans to write gross premiums of (£) 280m
this year from 18 classes of business. These include new lines in property,
reinsurance and professional. ACE INA UK said it will continue to write
specialty business lines suited to the Lloyd's market through syndicate 2488,
which remains the company's principal aviation and marine business platform. |
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PZU stake snag |
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EUREKO, the financial services
company based in the Netherlands, faces renewed opposition from the Polish
government to a deal it agreed with the outgoing administration, to buy a
further 21% stake in the state insurance giant, PZU. The new minister of
finance in Poland and one of its financial regulators were reported to have
reservations yesterday about how Eureko can fund the 30% stake in PZU it
already holds as well as buying another 21%. The two bodies are also concerned
about rumoured changes in Eureko's ownership structure. Dutch and Polish
regulators are due to discuss the issue in the next few weeks. |
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Vivendi cat bond |
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VIVENDI, the French media and Telecommunications
Company, has chosen to sell a catastrophe bond, to cover its southern
Californian properties for earthquake risk, instead of taking out a traditional
insurance policy. Under the terms of the bond deal, preference shareholders are
liable for the loss until 100% of their principal has been used up. Only then
do note holders risk their capital. However, in the event of a serious
earthquake, both groups of investors could in theory see 100% of their
principals used up. The only other example of this type of deal where a company
that is not in the insurance industry, transfers risk directly to the capital
markets, was when Oriental Land bought an earthquake catastrophe bond to cover
Disneyland Tokyo. |
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UK rates unchanged |
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THE Bank of England has left UK
interest rates unchanged for the 14th consecutive month. They stand at 4%
compared to the eurozone rate of 2.75% after the European Central Bank lopped
off half a point in December. The UK's central bank stood firm despite pressure
from manufacturers and those concerned that disappointing retail trading over
the Christmas period could signal the start of economic decline. |
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Medical complaints |
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FIGURES from a major provider
of medical indemnity insurance in the UK show that complaints against doctors
in 2001 were 15 times higher than they were 11 years earlier. The Medical
Defence Union, which covers more than half the country's doctors, said that
whereas only 36 complaints were made against doctors in 1990, 558 were filed in
2001. The target of the claims has also changed over the period according to
the statistics, which found that whereas only a quarter of the complaints were
about clinical care in 1990, this sector accounted for 80% of claims a decade
later. |
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Back to basics |
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AN Indian bank has frozen its
plans to enter the insurance broking business and pulled out of an asset
management joint venture as it focuses on core business. Industrial Development
Bank of India has not yet finalised how much it will receive from Principal
Group, its joint partner, for its 50% stake in asset manager AMC that the two
set up together. But it has said that the business, along with plans to expand
into insurance broking, is too non-core to its central strategy of developing
into a major bank. |
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Texas insures |
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THE US state of Texas has
started insuring properties of homeowners who are refused cover by at least two
insurance companies. All licensed property/casualty insurers writing
residential property insurance within the state must participate in the plan,
which is a sort of risk pool. The scheme was first proposed as a response to
the announcement by Farmers Insurance that it would pull out of the homeowners'
insurance market. It has been implemented despite the subsequent u-turn by
Farmers and agreement to continue writing policies for Texan customers because
people with bad credit and those who have older homes may still find insurance
is scarce. |
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Profits up 30.3% |
SHANGHAI-based China Pacific
Insurance made a net profit of Yuan459m ($55.5m) last year, up 30.3% on 2001,
according to local reports quoting the China Securities Journal publication.
New premiums were up 54.4% to Yuan35.7bn, mainly driven by a 74% surge in life
business by the company.
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News
in Brief |
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Judgment affirmed |
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BERMUDIAN reinsurer PXRE is
celebrating the affirmation of a $9.8m judgment in its favour its dispute with
Terra Nova Insurance Co. In June last year a New Jersey jury awarded PXRE
Corporation $8.25m plus interest following a dispute over claims under two
insurance policies that had been issued by an agent of Terra Nova. The company
gave no more details about the claims or the dispute, but had previously
included the figure in its reported results as a receivable in the other assets
category. Late last week PXRE Group announced that the United States Court of
Appeals for the Third Circuit had affirmed the $9.8m judgment. In a statement
the company said: "PXRE had previously recorded this amount as a
receivable and, as a result, the decision will not have an earnings
impact." |
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Saville at Lloyd's |
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LLOYD'S has appointed Iain
Saville as its first head of business process reform, with a remit to modernise
and improve business processes across the market. Mr Saville previously worked
for the Bank of England and was
chief executive of Crest. Part of his responsibilities will be as chairman of
Kinnect. Lloyd's chief executive Nick Prettejohn said the move was an important
milestone and "clear evidence of our determination to deliver the
significant economic benefits of efficient and modern business processes and
improve customer-service standards". |
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Bermuda bound? |
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INSURANCE group White Mountains
is planning to move as many as four of its subsidiaries to Bermuda from the US,
according to local reports. New Hampshire-based White Mountains moved its
registered office to Bermuda in 1999 but currently only has two employees on
the island. |
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Pro run-off |
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RUN-OFF service provider Pro
Insurance Solutions has been appointed to manage the day-to-day run-off of US
firm Highlands Insurance's UK business. Pro will assume responsibility for the
management of its portfolios, including those written by Highlands Underwriting
Agency and Tower Underwriting Management, on November 1. |
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Greenberg blast |
CHIEF executive of American
International Group (AIG) Maurice Greenberg has hit out at the New York Stock
Exchange's system of specialist traders, saying they do not always serve
investors in large companies.
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News
in Brief |
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Brit affirmed |
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BRIT Insurance Holdings'
enhanced capital base and increased diversification has led ratings agency
Fitch to affirm its A insurer financial strength rating on the company. The
rating has a positive outlook. Fitch said the move reflected Brit's current
strong profitability and the likelihood that would continue, along with further
expansion. |
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UK inflation fall |
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INFLATION in the UK fell in
June, against the predictions of economic experts. Although analysts had been
predicting a slight rise to 3% for the month, the actual figure fell to 2.8%,
which is still above the Bank of
England’s target of 2.5%. The fall is due to a drop in the cost of
foreign holidays and backs the authorities' decision last week to cut UK
interest rates to 3.5% their lowest level for 48 years. |
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Florida top comp |
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FLORIDA topped the league for
US workers' compensation claims costs, according to a report published by the
Workers' Compensation Research Research Institute. The study found that an
average workers' compensation claim in Florida was $3,081 in 1999. Higher
frequency and costs associated with more serious injuries pushed up the average
figure in Florida. The state made more use of lump sum payments than other states
in the survey. |
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Marine perils |
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GROWING numbers of marine
claims, and particularly the fire aboard the Diamond Princess (ID, October 4,
2002), have emphasised the importance of loss prevention for underwriters
active in the shipbuilding sector, a seminar in London heard yesterday. Nigel
Roberts, director of CTC Services, told an International Underwriting
Association (IUA) market forum: "Even the best shipyards in the world can
benefit from independent review of their operations. One simple piece of advice
can potentially save millions of dollars." |
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Standard fights |
UK insurer Standard Life is
preparing to fight off the second attempt in three years to force it to float.
Carpetbagger David Stonebanks has begun an action to get the Edinburgh-based
company to give up its mutual status, which he believes will net windfalls for
the company's current policyholders. Mr Stonebanks claims to have more than
2,000 supporters for his plan. Three years ago Standard Life successfully
fought off a previous demutualisation bid.
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News
in brief |
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- Demand for UK equity
release products is being choked by the poor historical reputation of the
schemes, according to a new Datamonitor report. Thepotential size of the equity
release market was (£) 459bn in 2001. |
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- IFA's may be in the firing
line as a result of new regulations issued regarding pension scheme terminations,
according to Jardine Lloyd Thompson. Regulations issued under the Pensions Act
give Opra powers to fine "all parties involved in the administration of
schemes." |
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- Mercer Human Resource
Consulting has been appointed actuary, administrator, investment and
communication consultant to the Sara Lee UK Pension Plan. |
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- After more than two decades,
Hyman Robertson is to replace Bacon and Woodrow as actuary and investment
adviser to two pension schemes of the Institute of Chartered Accountants of
England and Wales. |
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- Cazenove Fund Management has
been appointed by two local authorities, Weymouth & Portland Borough
Council and Dartford Borough Council, to manage their (£) 10m bond and cash
funds. |
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- Varma-Sampo Mutual Pension
Insurance Company has appointed Northern Trust as global custodian for its
E17bn fund. |
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- Gissings has been selected to
provide pensions services to United Technologies Corporation s (£) 210.5m UK
schemes. |
- Mercer Investment Consulting
has launched a new web-based global custody database to support its custody and
asset administration consulting services.
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