All articles by LII editorial
LII editorial
Aegon to persevere in Canada
A strategic assessment by Netherlands insurer Aegon on the future of its wholly-owned Canadian unit Transamerica Life Canada (TLC) has concluded that it represents a solid foundation for a successful presence in the Canadian marketplace. However, to meet what Aegon termed its profitable growth objectives, TLCs business model is to be revamped with key objectives including improving efficiency of operations and reducing Aegons capital allocation to the Canadian market At the end of 2007 TLCs shareholder equity stood at C$964.3 million ($894 million).
HSBC targets Korean insurer to accelerate its advance in Asia
HSBC targets Korean insurer to accelerate its advance in Asia UK bank HSBCs expansion strategy in Asian life insurance markets was advanced further in November with the conclusion of an agreement with Hana Financial Group (HFG), one of Koreas largest financial services groups
Axa acquires full control of Turkish joint venture for $525m
French insurer Axa is to acquire the 50 percent stake held in Turkish composite insurer Axa Oyak Holding (AOH) by its partner in the joint venture, Turkish conglomerate Oyak Group, for a cash consideration of $525 million Established in February 1999, AOH held a 10 percent share of the overall Turkish insurance market as at 30 June 2007, according to the Association of the Insurance and Reinsurance Companies of Turkey General insurance is the dominant source of AOHs premium income and in 2006 contributed 507 million ($750 million) or 88 percent of AOHs total of 577 million total
Egypt moves farther down liberalisation road
According to the Egypt Insurance Supervisory Authority (EISA), they have a combined share of 69 percent of Egypts life and general insurance market measured in terms of the industrys total investment assets as at 30 June 2006 of EGP18.7 billion ($3.3 billion)
Retirement income myth dispelled
Conventional wisdom suggests that retirement income is derived predominantly from savings and returns accumulated during the working years of a participant in a defined contribution (DC) pension plan This could not be further from reality, argue researchers at US asset management company Russell Investments, a unit of The Northwestern Mutual Life Insurance Company. Researchers Matt Smith, MD of Russells retirement services unit, and Bob Collie, investment strategy director, have dubbed their findings the 103060 Rule based on the benefits a DC scheme participant receives in retirement.
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Moving along the road to reform
Ireland has embarked on reform of regulations governing private health insurers, aimed at attracting new entrants into a market dominated for five decades by a single state-backed player Reform comes after intense pressure for change that culminated in the largest independent insurer exiting the market in 2007 Providing affordable health cover, be it private or state-funded, is a global challenge and one Ireland has tackled using a hybrid approach that is based on what the Irish government terms intergenerational solidarity effectively, equality of service for all that integrates state health service provision and private health insurance (PHI). The approach has many commendable aspects but after more than half a century since its introduction, flaws are evident, particularly in the realm of facilitating robust competition in Irelands PHI market.
Regulating the regulator
Having admitted to shortcomings in its handling of the Northern Rock debacle, the UKs Financial Services Authority (FSA) now faces harsh criticism for its regulation of life insurers The criticism has been leveled at the FSA by a Treasury Select Committee (TSC) investigating life insurers use of funds surplus to their realistic liabilities in with-profit funds
Allianz corners stubborn minority shareholders
AFor European bancassurer Allianz, gaining full control of its German life insurance unit, Allianz Lebensversicherungs (Allianz Leben), is a key element of its European rationalisation strategy However, Allianz Lebens more than 10,000 minority shareholders have proved stubborn, most having rejected a $900 million cash offer made by Allianz in January 2007 This left Allianz holding 92.58 percent of Allianz Leben, a marginal increase from the 91.03 percent it owned prior to the offer, and significantly below the 95 percent required in terms of the German Stock Corporation Act to undertake a compulsory buyout of minority shareholders
Prudential and Discovery launch PruProtect in UK
Prudential and Discovery launch PruProtect in UK UK insurer Prudential and South African insurer Discovery have teamed up to launch PruProtect, a joint venture offering a range of products that include life cover, income protection and severity-based serious illness cover
US life insurance industry gets a clean bill of health
Amidst economic uncertainty in the US, rating agency Moodys Investors Service, in a review of the industrys prospects, has declared the countrys life insurers to be in good shape However, despite the life industry being awarded a stable outlook for 2008, some pertinent caveats are included by the author of the industry outlook, Laura Bazer, a Moodys vice-president and senior credit officer From a positive perspective, Moodys believes that the impact of residential mortgage subprime-related asset write-downs on the US life insurance industry should be limited and that investment portfolios, for the most part, should emerge without significant damage