Thursday, October 28, 2010

Malaysia: Govt acts to make private health insurance compulsory for foreign workers

Malaysia's worker's compensation regulations for foreign workers will be tabled for amendment next year, under which worker's compensation insurance to be paid for by employers will cover occupational-related diseases and accidents,whereas medical insurance for non-occupational diseases and injuries will be paid
for by the foreign worker, reports the Bernama news agency.

Other Asian News

1. Indonesia: Insured losses estimated to be low in 25 Oct earthquake

US-headquartered catastrophe modelling firm, AIR Worldwide, has assessed that a powerful magnitude 7.7 earthquake which struck off the Mentawai islands in Indonesia on Monday night will not result in significant insured losses. The company, in a statement, cites the low earthquake insurance penetration in the area as a reason for the low insured losses.

2. Australians willing to pay less than US$300 for financial advice

The average Australian believes financial advice should cost just A$300 (US$292) upfront -almost 10 times less what planners say is the break-even cost of providing full advice, reports the Financial Standard citing research from Investment Trends' Planner Business Report.

3. East Asia: ACE buys New York Life's HK, South Korean units for US$425 mln

ACE has greed to buy New York Life Insurance's Hong Kong and South Korean life operations for about US$425 million in cash, the Swiss-incorporated property and casualty insurer says in a statement.

4. China: Ping An eyeing more investments in corporate bonds

Ping An Insurance (Group) Co, China's second largest insurer, will raise the proportion of corporate issues in its holdings, reports Bloomberg citing the insurer's Deputy Chief Investment Officer, Mr Timothy Chan.


Asia Insurance Review 28/10/2010

Wednesday, October 27, 2010

Munich Re expects prices to be stable for Jan renewals

Munich Re, the world's biggest reinsurer, is expecting prices for property and casualty coverage to
remain unchanged in the January round of renewals, reports Bloomberg.


Other News:


1. India: Stock mart regulator approves disclosure standards for life insurers

India's capital market regulator, the Securities and Exchange Board of India (Sebi) has approved long-awaited disclosure standards for the life insurance companies which aim to launch an initial public offer.

2. Asia: Calls to better manage globalisation risks

With heightened risks such as global health pandemics, food and water scarcity, and unconventional threats such as terrorism, there are calls for stronger forward planning to tackle such globalised risks, which are areas where insurance players can help, says a Singapore government minister.

3. China: Interest rate hike to boost insurers' bottomline

The 25-basis-point increase in China's one-year deposit and lending rates earlier this month, coming on top of loosened investment rules for insurers announced in August, bodes well for the bottomline of insurance companies in the coming quarters, reports Reuters.

4. Singapore: Health minister looking at ways to strengthen health insurance further

Singapore's Health Minister, Mr Khaw Boon Wan, says that he has held an informal lunch dialogue with all health insurers to review the state of the Republic's healthcare umbrellas.

Asia Insurance Review 27/10/2010

Tariff Rated Fire Insurance Premium - Can it be reduced further?

We know the fact that the Fire Insurance Premium is tariff rated and governed by the Rules of the Revised Fire Tariff (RFT)

A breach of the RFT can land the Insurer in hot soup with the authority where a fine or disciplinary action can be taken against the agent and/ or the principal Insurer involved.

Everything else being equal amongst the Insurers, can the premium be reduced further without breaching the rules of the RFT?

Why not? The question is HOW to do it.

Tuesday, October 26, 2010

Furniture and other Timber Related Risks

From the agents feedbacks, majority if not all the Insurers in town are reluctant to underwrite the fire risk involving furniture manufacturing plant and other timber related risks. Retail businesses such as furniture shops and furniture show rooms are not spared from exclusion either.

There are big businesses and big premiums from such risks floating in the market but unfortunately there are no takers with Insurers fearing that a major claim could wipe off their underwriting profits?

Any solutions?

If there is a will, there is a way......question is HOW to do it?

Monday, October 25, 2010

India: Wedding insurance becoming more popular

Something unique..if Insurers in Malaysia can follow their India counterparts in providing such insurance.

Quote:
Wedding insurance is rapidly becoming the norm in India where spending on big fat weddings countrywide can total Rs700 billion (US$15.8 billion) a year according to some estimates, reports The Economic Times.

Since marriage is usually a one-time event, major insurance companies are offering the cover as an event insurance product, which can be customised to suit the needs of a wedding.


Asia Insurance Review 22/10/2010

Fire Insurance Clauses for Stocks and Other Contents (Part 3)

On my earlier postings, I have indicated the relevant clauses that can be applied to the insurance on the buildings and machineries.

Now let us examine the appropriate clauses that can be applied to the insurance on the stocks and office furnitures, fixtures and fittings and personal effects and other contents therein.

1.0  Stock Declaration Clause
(on stock with minimum SI of RM500,000 per location. Provisional premium of 75% is charged on the estimated annual stocks with adjustment in premium which can be additional premium or refund premium depending on the difference between the estimated annual stocks and the actual annual stocks declared)

2.0  Other Contents Clause
(Includes loss or damage to items not otherwise specified in the policy, in this case (a) money, stamps etc up to RM1,000 (ii) Documents, manuscripts etc up to RM1,000 (iii) Computer systems records for the value of the materials etc up to RM1,000 (iv) patterns, moulds, designs etc up to RM1,000 and (v) personal effects, clothing tools etc up to RM1,000. No premium charged unless specifically insured as separate items)

3.0 Temporary Storage Clause
(includes properties which form part of the stock or materials in trade which are temporary stored anywhere including in transit, all within Malaysia, Singapore and Brunei for a maximum of 6o days. Subject to a Limit of 10% of SI on stock or RM500,000 whichever is lower. No premium charged unless specifically insured as another permanent location - advisable if storage shall exceed the 60 days period)

4.0 Contract Price Clause
(Applicable only to goods which are custom made on contract basis where a profit margin has been added to the manufacturing cost. In the event of the goods already manufactured but not yet delivered to the customers, shall be desctroyed by an insured peril, and the sale contract is cancelled by such reason, the Insurer will pay the claim inclusive of the said profit which the Insured would have made if not because of the destruction. Sum Insured on the SIT must reflect the COG + the profit margin)

5.0 Vehicle Load Clause
(Occassionally, stocks in container may arrived in a vehicle which may be forced to park outside the warehouse, overnight,  pending the unloading of the stocks into the building, the following day? A fire originated from the warehouse and spread to the stocks placed on the said vehicle? The stocks here are neither in the insured warehouse nor insured as goods in the open.This is where the Vehicle Load Clause comes in handy.  The criteria for a claim here is that the goods must be on the vehicle at the material time of happening, not just placed on the ground which will come under the Goods in the Open, if specifically insured.Claim is limited to the value of goods contained in the damaged container). Free Clause.

6.0 Brand, Label & Trade Mark Clause
(This applies to the salvage of the goods. One would perceived that goods that are branded or trade marked would fetch a higher salvage value than others in a claim settlement. Regardless of either, claims for salvage shall be the "face" value only..example whether the brand of the shirt is "Dunhill" or "Ah Beng", it is just a shirt, nothing more nothing less). Free Clause.

7. Internal Removal Clause (for office appliances)
8. Temporary Removal Clause (for office appliances)
9. Designation Clause
10.Removal of Debris Clause
11.Automatic Hold Cover (Properties in New Locations) Clause
12.Appraisement Clause
(Note: Clause 7-12, please refer back to earlier postings on Clauses for Buildings/Machineries)

Thursday, October 21, 2010

Philippines: Typhoon Megi wreaks damage estimated at less than US$150mil

Headquartered catastrophe modeling firm AIR Worldwide has estimated that insured losses to onshore properties in the Philippines from Super Typhoon Megi, which lashed the archipelago on Monday and Tuesday, will likely be less than PHP6.5 billion (US$150 million). AIR said its "loss estimates reflect insured damage to property (residential, commercial, industrial), and contents". Crop losses are not included.

Asia Insurance Review 21/10/2010

Monday, October 18, 2010

Insurance Industry Honours Cream of Asia's Crop

Bali, Indonesia, 17 October 2010 – The crème de la crème of Asia's insurance industry was feted at the 14th Asia Insurance Industry Awards with several surprises.

For the first time, a Chinese company – China Pacific Life - swiped one of the most prestigious titles in the long history of the Awards, winning the Life Insurance Company of the year. Lonpac Insurance became the first Malaysian winner of the prestigious General Insurance Company of the Year award in recognition of its
responsiveness to customer needs and solid financial performance.

Another head turner was the Personality of the Year Award given to Mr Leslie Mouat, Chairman of Chartis Asia Pacific, for holding the team and the fort together in the wake of the global financial crisis and the AIG trauma.

Sompo Japan Insurance won the inaugural Green Company of the Year, awarded to the company which has given long-term commitment and resources to a sustainable green programme and has ensured its successful implementation. It is hoped that this Award will make the insurance industry more conscious of not only going green but also encouraging its clients to do the same.

India emerged as the market that won the most number of Awards, winning three of the 14 categories with Technology Initiative, Educational Service Provider and Corporate Social Responsibility.

The prestigious annual Awards are keenly contested by players in the Asian insurance markets in the region each year, and 2010 was no exception. The winners were selected by industry peers with 27 distinguished insurance leaders serving on the Panel of Judges.

The 14th Asia Insurance Industry Awards were jointly organised by Singapore-based Asia Insurance Review and London-based The Review Worldwide Reinsurance magazines.

This year's Awards presentation was held on the eve of the 25th East Asian Insurance Congress and attended by more than 400 senior executives and officials from the insurance industry at The Westin Resort Nusa Dua, Bali, Indonesia.

The Winners for 2010 are:-

Life Insurance Company of the Year
China Pacific Life (CPIC Life)

One of the pioneers of China's life insurance industry, CPIC Life has responded to market demands with products covering all seasons of life, using technology to reach out to customers.

General Insurance Company of the Year
Lonpac Insurance

Lonpac impressed the judges with its use of in-depth product knowledge and technology to meet customers' needs, while consistently maintaining a good financial performance.

Educational Service Provider of the Year
Joint Winners:

Australian & New Zealand Institute of Insurance and Finance (ANZIIF), and the MicroInsurance Academy (MIA)

ANZIIF was recognised for its continued achievement in developing and enhancing professional industry standards, while MIA's innovative training methods won admiration from its peers and the judging panel.

Innovation of the Year
EQECAT

EQECAT's Asia typhoon model has revolutionised the way in which the insurance and reinsurance industry evaluates risk in the region.

Service Provider of the Year
Mark International

Having operated in Asia since 1986, ReMark has become the market leader in providing alternative distribution and marketing solutions to its insurance partners across the region.

Broker of the Year
Marsh

The five-time winner of the Broker of the Year award continues to help its clients succeed in unpredictable environments.

Reinsurance Broker of the Year
Guy Carpenter

A winning combination of its global platform with local knowledge and execution capabilities has helped Guy Carpenter clinch the Reinsurance Broker of the Year title for the fourth time.

General Reinsurer of the Year
Allianz SE Reinsurance Branch Asia Pacific

Allianz SE Reinsurance Branch Asia Pacific is the General Reinsurance Company of theYear for the second time running, thanks to its client focus, consistently sound technical advice and tailor-made solutions.

Life Reinsurer of the Year
Swiss Re

Swiss Re has overcome the challenges of 2009 to win the Life Reinsurer of the Year accolade for the third time.

Corporate Social Responsibility Award
Aviva Life Insurance Co India

Aviva Life Insurance of India impressed the judging panel by demonstrating how corporate social responsibility can be closely and successfully tied with business strategy.

Green Company of the Year
Sompo Japan Insurance

Sompo Japan's long-running green programme and its tireless efforts in championing green initiatives have made it the clear winner in this category.

Technology Initiative of the Year
Financial Information Network and Operations Ltd (FINO)

For transforming the delivery of micro-health insurance services, FINO of India has won the inaugural Technology Initiative of the Year award.

Personality of the Year
Leslie John Mouat

Caring boss, consummate professional, industry expert and iron-disciplined corporate manager – these are fitting attributes of Les Mouat, Chairman of Chartis Asia Pacific, who demonstrated extraordinary leadership during the toughest of times.

Lifetime Achievement Award
Alfonso T Yuchengco

Alfonso Yuchengco has won the Lifetime Achievement Awards for his career as a businessman, banker, insurance maverick and diplomat.

Bernie Fung (1953-2010)

Bernie's sudden, untimely death earlier this year was a big blow to the industry and to all who knew him. This Award is a tribute to what he did for the industry he was so committed to.

Appendix:

The panel of 27 distinguished judges comprise:

Annie Choi, Commissioner of Insurance, Hong Kong
Dr Bassel Hindawi, Immediate Past Director General, Insurance Commission of Jordan
Chantra Purnariksha, Secretary-General, Office of Insurance Commission, Thailand
Dr Huang Tien-Mu, Director General, Insurance Bureau, Financial Supervisory Commission, Taiwan
Isa Rachmatarwata, Chief of Insurance Bureau, Indonesia
Alan Wilson, Regional Co-Chief Executive Officer, MSIG Holdings (Asia) Pte Ltd
Chai Sophonpanich, Chairman and President, Bangkok Insurance Public Co Ltd
Christopher Ho, Chairman, Singapore Reinsurer’s Association
Clarence Yeung, Managing Director, Client Markets Asia & Regional Broker Executive Asia, Swiss Reinsurance Company
David L Fried, Group General Manager and Group Head of Insurance, HSBC Holdings plc
David Kinloch, Chief Executive Officer, Labuan IBFC Inc Sdn Bhd
Hiroshi Fukushima, President & Chief Executive, The Toa Reinsurance Co Ltd
Leslie J Mouat, Chairman, Chartis Asia Pacific
Michael J Morrissey, President & Chief Executive Officer, International Insurance Society Inc
Patrick M Liedtke, Secretary General & Managing Director, The Geneva Association
Patrick Poon, Chairman of Operation Committee and Director, China Pacific Insurance (Life) Co Ltd
Richard Austen, Chairman, Reinsurance Brokers’ Association (Singapore)
Sara Lamsam, President, The Thai Life Assurance Association
Scott Ryrie, Chief Executive Officer, Allianz SE Reinsurance Branch Asia Pacific
Simon Machell, Chief Executive Officer, Asia Pacific Aviva Asia Pte Ltd
Stephen Collins, Chief Executive Officer, ReMark International B.V.
Tadashi Baba, Managing Director, Sompo Japan Asia Holdings Pte Ltd
Takashi Yoshikawa, Chief Executive Officer, Tokio Marine Asia Pte Ltd
Teddy Hailamsah, Secretary-General, Asean Insurance Council & Chairman, 25th EAIC Organizing Committee
Tony Cheng, Chief Executive Officer, Hong Kong & Southeast Asia and Executive Advisor, China & Taiwan, RGA Reinsurance Company
Yassir Albaharna, Chief Executive Officer, Arab Insurance Group (B.S.C.)
Yogesh Lohiya, Chairman cum Managing Director, General Insurance Corporation of India



Source: Asia Insurance Review 18/10/2010

Sunday, October 17, 2010

The Obese could pay more for Insurance in China

An interesting news:

Life insurers in China can charge obese people, whose body mass indexes (BMIs) exceed 30 for men and 28.6 for women, up to 200% more than normal premiums, as research shows they are more likely to get ill than those who are of normal weight, reports the Xinhua News Agency. The BMI is obtained by dividing one's mass over the square of one's height in metres.


Asia Insurance Review 15/10/2010

Retirement Funds

Employees in Malaysia should set aside at least 10% of their income apart contributions to the mandatory government-run Employees Provident Fund (EPF) for their retirement, reports the Bernama news agency citing Financial Planning Association of Malaysia deputy president, Mr Tan Beng Wah.

Asia Insurance Review 15/10/2010

Wednesday, October 13, 2010

Fire Insurance Clauses for Machineries (Part 2)

In my earlier postings on Fire Insurance Clauses, I mentioned that there are numbers of Clauses that can be applied to the plant and machineries to be insured. Amongst the many includes:

Electrical Installation Clause B (as a buy back cover for damage to machinery arising from excessive running or over heating process). Additional rate of 0.056% is charged.

Hire Purchase / Leasing (protects the financial interest of the financer against loss or damage on the subject charged to the banks/leased by Insured)

Internal Removal Clause (includes claim for any items that had been moved from one insured premises to another insured premises within the territorial limits but indvertently not advised to the Insurer). Pro-rata premium is charged for the omitted items)

Temporary Removal Clause (includes claim for any loss or damage to the machinery whilst under repair, maintenance or servicing work at any other premises within the territorial limits)

Computer Systems Records Clause (includes claim for the value of materials together with clerical labour and computer time expended in reproducing such records and not for the value of the information therein)

Removal of Debris Clause (cost incurred to remove the debris in order for reinstatement work to proceed). Can insure separately or incorporate as part of the sum insured.

Capital Addition Clause with minimum SI of RM1.5m   )
Designation Clause                                                    ) simiar application as explained
Automatic Hold Cover for new locations Clause       ) under the Clauses for building
Appraisement Clause                                                 )
Reinstatement Value Clause (up to 5 years old)       )
Market Value & Escalation Clause                     )
(older machines) )


Next posting : Fire Insurance Clauses for Stocks and other Contents

Friday, October 8, 2010

Malaysia: Insurers see 20% growth this year

The life insurance industry will grow by more than 20% this year and show a stronger performance next year, according to the Life Insurance Association of Malaysia (LIAM).


Asia Insurance Review 7/10/2010

Tuesday, October 5, 2010

Malaysia: Insurance sector backs government plans for private pension funds

Insurers in Malaysia are all for a government initiative to promote private pension funds in the country but add that the plans needs skilled insurers and fund managers that hold long-term views for private pension schemes to be effective, reports The Star newspaper.

Other Asia News
2. Japan: US giants compete in Japan

Two US insurers -Prudential Financial and MetLife – are battling it out for business in Japan as
American International Group sells two Japanese life insurance units to Prudential Financial, while it completes a deal with MetLife for American Life Insurance (Alico).

3. India: Foreign parties cannot have majority share in insurers after listing. When insurance joint ventures in India go public, their promoters will have to bring down their stake in the companies to a proportion that allows the Indian promoters to hold a majority of the capital, reports the Financial Chronicle citing the head of the Insurance Regulatory and Development Authority (IRDA).

4. Australia: Flood cover expands Down UnderMore than half of the Australian market now has access to flood cover compared to the years before 2008 when there was little flood insurance available in the country, reports the Sydney Morning Herald citing the Insurance Council of Australia (ICA), which represents non-life insurers in the country.

5. Vietnam: Govt studying Thailand's health insurance systemVietnam is looking at developing its national health insurance system based on Thailand's successful model, reports the Bangkok-based The Nation newspaper.


Source: Asia Insurance Review 5/10/2010

Sunday, October 3, 2010

Fire Insurance Clauses for Buildings (Part 1)

There are many Clauses available for use in the Fire Insurance Policy but do not mean that we can apply them across the board as some of these clauses are not relevant at all to the subject matter insured.

Generally, let us look at the applicability of some of the common clauses for buildings followed separately by machineries, stocks and other contents insured.

Suggested Clauses for Buildings

1) Mortgagee Clause (protects the financial interest of the bank to whom the building is mortgaged)

2) Automatic Renewal Clause (to be used in conjunction with the Mortgagee Clause -applicable to the bank issued proposal only)

3) Outbuildings Clause (need to top up the sum insured to include all other external structures such as gates, fences, garages etc which are outside the description of the main building)

4) Reinstatement Value Clause (specifies that indemnity is based on the cost incurred at the time of reconstruction not at the time of loss or damage)

5) Reinstatement Value-Day One Clause (caters to the inflation factor in the event the new reconstruction cost of the building exceeds the Policy's Reinstatement Value sum insured)

6) Designation Clause (protects the interest of the Insured. Insurer cannot dispute the claim in the event the name of the insured appearing in the receipt/invoice does not tally with the name appearing in the policy so long it can be proven that the Insured is the interested party insured under the policy)

7) Capital Addition Clause with minimum sum insured of RM1.5 million (caters to the alterations, improvements and additions to the existing buildings after the inception of cover, which total sum to be declared to the Insurer within 90 days therefrom for an additional premium to be charged)

8) Architect, Surveyors and Consultant's Fees (not included in the claim  unless separately insured or included as part of the sum insured.(Fire pays for physical damage to the structures only not the fees incurred)

9) Removal of Debris Clause (same as 8)

10) Foundation Exclusion Clause (Insurer will incorporate this Clause automatically. Can request to waive this clause if there is an absolutle risk of the foundation being damaged by a peril especially from the act of God. Sum insured must include the cost of the foundation)

11) Public Authority Clause (need to top up the sum insured to cater to the additional cost incurred in reinstating the building according to the new building by-laws which was not in place then.This holds true for pre-war buildings which may not meet today's new buildings by-laws etc)

12) Appraisement Clause (expedites the claim. Proof of purchase/invoice/ receipts are required for the damaged items only so long the loss does not exceed 5% of sum insured or RM 5,000 whichever is the lower)

13) Alterations & Repair Clause (protects the interest of the Insured in the event of a loss occurring in the premises caused by workmen performing some renovation, improvement works etc)

14) Tenant's Clause (protects the owner non occupier of the building against any claim due to the change in risk/occupation committed by the tenant without the knowledge of the owner. Insurer will honour the claim but the owner must agree to pay the difference in the premium based on pro-rata from the date the change in risk took effect)

15) Automatic Hold Cover for New Locations (good for Insured who may acquire new properties elsewhere within the insured territorial limits as part of their business expansion. Insurer will provide a 30 days grace period to cater to this new acquisition subject to declaration within 30 days therefrom and additional premium is paid based on pro-rata basis)

Next: Fire Insurance Clauses for Machineries