All articles by LII editorial
LII editorial
Dai-ichi pins its hopes on demutualisation
Ending months of speculation, Japanese life insurer Dai-ichi Mutual has announced plans for its demutualisation Subject to approval by policyholders and regulatory authorities, Japans third largest life insurer will in the first half of its fiscal year ending 31 March 2011 undertake an IPO, following which it will become Japans third listed life insurer In a statement the insurer explained that the decision to demutualise had been based on its anticipation of intensified competition in the life insurance industry as a result of demographic and other social changes
Société Générale gets green light to advance bancassurance strategies in Russia and Romania
Socit Gnrale gets green light to advance bancassurance strategies in Russia and Romania Sogecap, the life insurance unit of French bancassurer Socit Gnrale, has received approval from Russias banking regulator to acquire payment protection insurer Soyuznik and establish a life insurance company in Russia
US life insurers under fire for travel discrimination
The issue has now come to a head with the filing of a complaint by the Florida Office of Insurance Regulation (FOIR) against American General Life Insurance (AGLI), a unit of American International Group In a release the Florida Insurance Commissioner, Kevin McCarty, explained that his office is seeking to suspend or revoke AGLIs certificate of authority to write insurance policies in Florida and require the insurer to end unfair trade practices as defined in the Freedom to Travel Act
US uninsured numbers rising
The median household income in the US increased from $47,845 in 2005 to $48,201 in 2006, leaving the average American family 0.7 percent better off in real terms, according to a report published by the US Census Bureau However, despite this improvement in income, the number of people without health insurance coverage rose from 44.8 million in 2005 to 47 million in 2006 As a proportion of the total population, this represented an increase from 15.3 percent to 15.8 percent.
UnitedHealth on the back foot
A class action lawsuit brought against one of the US largest health insurers, UnitedHealth, in 2006 has reached finality with the company agreeing to pay $895 million into a settlement fund for the benefit of class members In the lawsuit CalPERS alleged that UnitedHealth issued materially false and misleading statements regarding the companys business, its stock option plans, compensation practices and its financial results, while employing manipulative acts in connection with UnitedHealths stock option programmes and financial statements.
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Discovery shrugs off US setback
Arguably the most dynamic insurer to have entered the South African market in decades, Discovery has built an impressive business on the foundation laid by its health insurance unit Though Discovery had to admit defeat in the US, its South African and UK businesses continue to forge ahead at a brisk pace Breaking into the US health insurance market is a tough challenge, as South African composite insurer Discovery Holdings has found to its cost
PPI mis-selling still rife in the UK
Despite hefty fines having been handed down, the sales methods employed in the UKs £5 billion ($9 billion) annual premium payment protection insurance (PPI) remain far from acceptable This conclusion was drawn by the Financial Services Authority (FSA) following a mystery shopping exercise it conducted to assess customer experiences of face-to-face branch sales of single premium PPI when sold alongside an unsecured personal loan.
Pension funds being burdened by excessive asset management fees
Pension funds are on the hunt for alpha, the added dash of performance over and above the returns generated by a benchmark index A resultant scramble for services of alternative asset managers has been a primary driver of a substantial increase in investment management fees paid by pension funds, an increase that is not always justified, cautions consultancy Watson Wyatt in a research note entitled A fairer deal on fees According to Watson Wyatt, the average investment management fee paid by pension funds and superannuation funds worldwide has jumped by almost 70 percent, from 65 basis points of fund asset value in 2002 to 110 basis points at present.
CNP looks to new markets for growth
French insurer CNP Assurances (CNP) and Greek bank Marfin Popular Bank (MPB) have entered into a bancassurance alliance initially targeting two of Europes most underinsured markets, Greece and Cyprus Under the terms of the agreement CNP and MPB will enter into an exclusive 10-year renewable distribution agreement which carries an extension option in other countries where MBP operates Cementing the alliance, CNP will acquire a 50.1 percent stake in MPBs life insurance units for a cash consideration of 145 million ($225 million) plus an earn-out of 20 million linked to business objectives
Asset management boost for Generali
Asset management boost for Generali Assicurazioni Generalis expansion strategy in asset management took a decisive step forward in November, with the announcement that it would acquire Swiss Lifes wholly owned Swiss private banking subsidiary, Banca del Gottardo (BDG), for 1.069 billion ($1.59 billion)