November 2007 Archives

The main trouble with insurance, and it does cause business people quite a lot of trouble, is that people think about it in a variety of wrong ways.

A wrong way is to pay as little as possible in insurance premium, without thinking about the security of the business.

Well, you may have a crystal ball which tells you that you are never going to have a loss. If so, it is logical to buy insurance only when you have to. You will find that those with a monetary interest in your property, for example, mortgagees, will insist on your having certain policies, and some insurance such as automobile insurance may be compulsory in many provinces. But apart from those situations, you should buy no insurance - if you are not going to have any losses.

However, most people face the fact that they may have a loss some day, and perhaps a serious one they can not afford it by themselves. Having reached this conclusion, the next step must surely be to see that you have adequate coverage - that is, insurance that leaves no important gaps, but does not waste money on insuring trivial items that you can better pay for yourself.

(Palm Beach, Florida) After rejecting a proposal earlier this year to provide health benefits to the same-sex domestic partners of its employees Palm Beach Community College has decided to offer workers insurance for their pets.

Anyone who works for the college would be able to enroll in the pet insurance plan, through Veterinary Pet Insurance. It would cost employees between $22 and $28 per month for dogs and $15 to $18 per month for cats.

The plan will come into effect on January 8.

More info, click here.

Ontario’s superintendent of financial services should review the use of the verbal threshold for establishing serious and permanent injury and/or the use of a Cdn$30,000 deductible to discourage plaintiffs from pursuing smaller auto negligence claims, according to the summary of findings in the Civil Justice Reform Project.
The author of the Civil Justice Reform report, former associate Chief Justice of Ontario Coulter Osborne, released his findings in November 2007. Smaller auto negligence claims represent 21% of the province’s Superior Court of Justice claims, Osborne noted.
In his report, Osborne noted Ontario’s Bill 198 amendments to the Insurance Act in 1996, as well as its associated regulations, are intended to minimize smaller auto negligence claims.

More, click here.

DENVER (AP) - A woman involved in a two-vehicle crash in Denver more than two years ago has gone back to court in an effort to get an insurance company to pay up.

Shantel Gonzales was riding with a friend on Father's Day 2005 when the vehicle in which she was a passenger collided with a truck.

Gonzales was 22 weeks pregnant at the time. Doctors performed an emergency Caesarean section, delivering a boy that Gonzales named Marco. But he was born 3.5 months premature, and lived for just over an hour.

Gonzales sued Shelter Insurance for damages, and a jury last year awarded her $130,000.

The woman's attorney says Shelter hasn't paid that verdict, though it did pay $14,000 toward her medical expenses.

Shelter would not comment.

The trial is expected to last three or four days.

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The average risk of landfalling hurricanes in the Atlantic Basin for the next five years remains at significantly above the risk averaged over the long term, warns Risk Management Solutions (RMS).
The current activity rates lead to estimates of average annual insured losses that will be 40% higher than those predicted by the long-term mean of hurricane activity for the Gulf Coast, Florida and the Southeast, an RMS release reports.
The risks will be 25% to 30% higher for the mid-Atlantic and Northeast coastal regions, RMS added.

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According to a study cited in State Street’s ‘Vision 2007’ paper on the global insurance industry, approximately 69% of insurance firms in 2006 outsourced a portion of their general account investments to unaffiliated asset management companies. In total, the amount outsourced in 2006 was pegged at US$805 billion.
But this figure is expected to increase by an additional US$1 trillion by 2011, according to State Street’s report.
“Recent activity…suggests that some companies are actively searching for arrangements that encompass the outsourcing of 100% of an insurer’s general account investment management and asset servicing tasks — such as insurance accounting and reporting services — to a single organization,” the report says. “This looks to be the beginning of a ‘total lift-out solution’ trend in insurance company outsourcing.”

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The surge in costly in protection and indemnity (P&I) pool claims in 2006 could be a sign of the times, as booming shipping operations become more expensive, according to Aon’s P&I Pre-renewal Report 2007.
In anticipation, P&I clubs are already initiating increases of 10-20% in shipowners’ premiums at the next renewal, Aon’s report notes.
“The high value of claims in 2004 – so far totalling US$280 million – were viewed as an anomaly, yet current evidence suggests that costly claims may be a feature of the current cycle,” Aon says in a press release.
Aon says 2006 claims, if they follow recent trends, could reach US$580 million. The 2006 average claim value of US$18.06 million would nearly double the 2004 average of US$9.66 million.

more, click here.

If you have been thinking about getting term life insurance, now's a great time to start shopping because life insurance rates are declining rapidly.

According to the Insurance Information Institute's forecast the cost of term life insurance policies will drop by an estimated four percent in 2007. Term life insurance rates are dropping largely as a result of increased competition among insurance companies.

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RBC Insurance is reminding Canadians to think about travel insurance, even for last-minute, short getaways across the border.

With the rising dollar, some Canadians will be heading south this American Thanksgiving weekend looking for deals as the holiday shopping season begins.

But that cross-border trip could end up costing more than planned if medical treatment is needed while away from home, RBC Insurance says.

“Unfortunately, accidents can happen at any time, so don't let a shopping trip end up costing you more than you bargained for,” says Stan Seggie, president and CEO of the travel insurance division of RBC Insurance. “For less than $25, you can purchase travel insurance for up to four days, to protect against unexpected emergencies that may happen when you go across the border,” addsSeggie.

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Optimum Group Inc., a privately owned international financial group, and Optimum General Inc., a Canadian property and casualty underwriter, have announced an acquisition by way of an amalgamation.
Optimum General will be a wholly-owned subsidiary of Optimum Group and the related parties of Optimum Group.
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Despite reporting gains in its general insurance operations, Desjardins Group, an integrated cooperative financial group, recorded combined surplus earnings in 2007 Q3 of Cdn$248 million, down Cdn$80 million or 24.4% from the same quarter of 2006.
“This decrease was primarily due to a write-down of 8.3%, or Cdn$160 million (pre-tax), related to non-bank-sponsored, asset-backed commercial paper (ABCP) holdings,” Desjardins noted in a press release. “Excluding this write-down, combined surplus earnings before member dividends would have been Cdn$355 million, up more than 8%.”

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Net written premiums in the company’s Canadian operations increased 6% to US$140.6 million for 2007 Q3, a Kingsway statement says.
Underwriting profit for the entire organization decreased 159% to a loss of US$7.5 million, and the company’s combined ratio increased 4.4% to 101.6% compared to 2006 Q3.

More details

A post-remembrance day windstorm has served as a reminder that the British Columbia winter storm season is underway, and residents should be prepared for future severe storms, the Insurance Bureau of Canada (IBC) warns.
Roughly 90,000 B.C. Hydro customers were without power on Nov. 12, after the first windstorm of the season first made waves on the night of Nov. 11. The storm strengthened Nov. 12 and knocked down trees and hydro lines in its wake, CBC.ca reports.
At the height of the storm, roughly 196,000 customers were without power, a BC Hydro spokesperson told the CBC.ca. Many major ferry routes were cancelled during the storm.

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WASHINGTON — Florida homeowners are one step closer to obtaining available and affordable homeowner’s insurance and ending the ongoing crisis that has plagued the state.

The U.S. House approved legislation Thursday night on a 258-155 vote that aims to stabilize the catastrophe insurance market by expanding private industries’ capacity to cover a natural disaster and help states manage risk.

Under the Homeowner’s Defense Act of 2007, a bill introduced by Reps. Tim Mahoney, D-Palm Beach Gardens, and Ron Klein, D-Boca Raton, a federal program would be created to assist state-sponsored insurance programs on covering losses from natural disasters. The bill would set up a federally funded office where states could go to receive assistance for some of the catastrophe risk they have assumed.

The legislation would allow multiple states to join together to help pay for each other’s disaster costs, a more appetizing role for investors to assume, and then transfer the cost to the private markets through catastrophe bonds and reinsurance contracts.

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On a request from the Republic of China Hot Springs Tourism Association, the cabinet will discuss next week whether government health insurance should cover visits to the island's geothermal hot springs resorts, Josef Wu, deputy water resources director of the Ministry of Economic Affairs, said on Friday.

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The recall of a Hong Kong-made Bindeez product this week has prompted calls for a mandatory liability insurance on all imported goods.

Thousands of stores across New Zealand, Australia and North America removed the small beads from their shelves after scientists discovered they contained a chemical that, if swallowed, transformed into the illegal party drug, fantasy.

The New Zealand Manufacturers and Exporters Association says the insurance would ensure all imported goods complied with New Zealand safety standards and would provide local companies with a level playing field when competing with cheaper, and possibly lower quality imports.

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EGI Financial Holdings Inc. (TSX: EFH) has reported a profit of Cdn$4.5 million for 2007 Q3, marking an 18.7% decrease over last year’s Q3.
The company reported a combined ratio of 88.5% and Cnd$42.3 million in direct written premiums, a 45.1% increase over the same period of time last year.
Net written premiums increased from 2006 Q3’s Cdn$26.6 million to Cdn$39.6 million in 2007 Q3.
Underwriting income, however, decreased 43.2% to Cdn$3.5 million in 2007 Q3.

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Climatologists are warning that the recent wildfires in California may be a result of climate change and a taste of things to come, reports Lloyd’s.
Models are suggesting the North American west coast is experiencing longer-term precipitation patterns — several wet years in a row, followed by several that are drier than normal, Ronald Neilson, a professor at Oregon State University and bio-climatologist, told Lloyd’s.
These longer “wet” periods encourage vegetation growth, increasing the available fuel for such events, so that when the area does enter a dry period, a forest fire has even more surface vegetation on which to feed, he explained.

I took the ING seminar this Monday with my co-worker. Their Vancouver office is good. City view south and mountain view north.

That's Vancouver.

Some news from them as below.
ING Canada has reported a Cdn$64-million decrease in its 2007 Q3 profits.
This year, the company reported a 2007 Q3 net income of Cdn$92 million, down from Cdn$156.8 million over the same period last year.
For the first nine months of the year, ING’s net income was Cdn$412.6 million, down from the Cdn$548.7 million the company reported for the same period in 2006.

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The Co-operators General Insurance Company reported profits of Cdn$30.3 million for 2007 Q3, compared to Cdn$18 million for 2006 Q3.
The improvement was due to stronger underwriting performance, according to The Co-Operators.
Gross written premium increased 4.1% to Cdn$571.9 million in 2007 Q3, compared to Cdn$549.3 million in 2006 Q3. The increase is primarily due to growth in the auto and home lines of business in western Canada, according to a release.

More details, click here.

Insurance industry payrolls in the United States increased by 1,500 in the month of October, to a new high of 2.367 million, reports A.M. Best Company.
Citing research from the U.S. Bureau of Labour Statistics, A.M. Best reported that average weekly earnings for the industry’s non-supervisory positions rose from US$799.62 to US$850.39 during the period between September 2006 and September 2007.
Insurance carriers’ weekly earnings jumped from $864.49 last year to $902.87 in 2007, but the brokerages and agencies showed the biggest gain, increasing from US$677.93 to U.S. $757.02, A.M. Best reported.
Claims adjusters’ average weekly earnings also saw a significant rise from US$807.75 to US$869.22. At the same time, this sector saw a loss of 1,500 jobs over the time frame.
Reinsurance payrolls, on the other hand, rose by 1,400 jobs (to 30,600) over the year. Over the same period, the reinsurance profession reported a drop in average weekly earnings from US$789.35 to US$768.41.
Property/casualty remained the most highly compensated segment of the industry, with a rise in average earnings from US$906.40 in September 2006 to US$956.81 this September.

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The legal test for negligence — which would absolve an outdoor equipment provider of liability in a personal injury case — is “not perfection but rather to design a product so as to eliminate any unreasonable risk of foreseeable injury,” the Ontario Superior Court ruled in Enslev v. Challenges Unlimited Inc. And although an outdoor swing designer might have foreseen operator error during the use of the product, the consequences of the operator error nevertheless could not have been predicted, the court found. The decision upheld a waiver of liability contained in a signed contract between a Cleveland House (a Muskoka resort) and Challenges Unlimited, an outdoor equipment supplier.

Fairfax Financial Holdings Ltd. has reported profits of Cdn$253.2 million for 2007 Q3, a dramatic increase from 2006’s Q3 loss of Cdn$359.2 million.
In the first nine months of 2007, net earnings increased to Cdn$532.2 million, compared to a reported profit of Cdn$68.4 million for the same period last year.
Fairfax is the parent company of OdysseyRe and Northbridge Financial Company. Respectively, the subsidiaries reported combined operating ratios of 88.5% and 97.9%.

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1. Take a driver safety course.

2. Increase your deductible.

3. Forgo comprehensive and/or collision coverage.

4. Compare prices regularly.

5. Use the same company for homeowners and auto insurance.

6. Take advantage of group discounts.

7. Choose a vehicle that is less expensive to insure.

8. Use your clean credit report to your advantage.

9. Ask about discounts for young drivers.

10. Pay your premium in advance.

Detailed description about the above top 10 tips to save your Auto Insurance bill, click here.

One in four Floridians under age 65 have no health insurance, and the number of Floridians of all ages without health coverage has grown by 38 percent over the past eight years, to 3.8 million.

Canada's unemployment insurance (EI) premiums will fall by almost 4 percent next year, Finance Minister Jim Flaherty said on Thursday.

Canada's Finance Minister Jim Flaherty announced it.

The rate for employees will fall to $1.73 from $1.80 per $100 of insurable earnings. Employers will have to pay $2.42 instead of $2.52 per $100 of insurable earnings.