Recently in Canada Category

AXA reported its 2008 Q1 property and casualty revenues increased by 2% to EUR8.885 million (Cdn$13.74 billion), up from EUR8.625 billion (Cdn$13.33 billion) in 2007 Q1.
"This solid performance resulted from positive new business volumes with personal motor and household net new contracts reaching 246,000 and 17,000 contracts, respectively, as well as prices holding up well across the board," the company noted in a press release.

Ontario auto rates are on the rise, according to data posted by the Financial Services Commission of Ontario (FSCO), the regulator of the province's insurers.
Rate applications approved for 2008 Q1 averaged +1.05%, based on the entire market, FSCO noted in an online bulletin.
Rate changes approved in 2004, 2005, 2006 and 2007 were -10.60%, -2.43%, -1.27% and +0.55%, respectively, for the entire market.
In 2008 Q1, for the 43.37% of the market that had rate changes approved, the average rate change was +2.42%, when weighted by market share.

Desjardins General Insurance (DGI) is now offering direct home and auto insurance in Ontario.

In an effort to better manage risks during a period of large-scale catastrophes, insurers should consider offering long-term policies to homeowners in hazard-prone areas.
"Such a long-term policy could be tied to a mortgage, and home improvement loans can encourage the adoption of cost-effective mitigation measures," says a report co-authored by the Wharton University of Pennsylvania, the Insurance Information Institute and Georgia State University.
"A program of insurance vouchers, similar in concept to food stamps, could assist low-income residents in disaster-prone areas to purchase adequate insurance coverage."
The report found that, among other things, most homeowners in hazard-prone areas consider only premium payments, without taking into consideration the benefits of protection, when considering their insurance purchases.

American International Group, Inc. (AIG) reported loss of US$5.3 billion for 2007 Q4, and a net income of US$6.2 billion for the full year 2007, representing a 55.9% decrease over the prior year.
In 2006 Q4, AIG reported a profit of US$3.4 billion. "The 2007 other-than-temporary impairment charges resulted primarily from the significant, rapid declines in market values of certain residential mortgage-backed securities in the fourth quarter, for which AIG cannot reasonably determine the recovery period will be temporary," the company reported in a statement.

In order to respond to the rising costs of climate change-related damages, insurance companies are going to have to focus more on micro-solutions (i.e. on a policyholder-by-policyholder basis), Colin Empke, partner at Blaney McMurtry LLP, told delegates at the Canadian Defence Lawyers 4th annual insurance coverage symposium in Toronto on Feb. 28.
Empke was speaking on behalf of Anthony Saunders, partner with Guild, Yule and Company, who was unable to attend the symposium.
Empke observed an increasing number of weather-related insurance losses, causing the industry to seek ways to deal with increasing costs and solvency issues.

Kingsway Financial Services Inc. (TSE:KFS) reported a net loss of US$103.5 million for 2007 Q4 and a net loss of US$18.5 million for the year, marking a decrease of 716% and 115% over the same periods of 2006, respectively.
The combined ratio was 130.2% in the quarter (109.3% for the year), with Canadian operations reporting a combined ratio of 99.8% (95.0% for the year), a Kingsway release says.

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Forty per cent of collision repair centres responding to a Canadian Collision Industry Forum (CCIF) survey noted they have suffered a loss of tradespeople within the last year, potentially affecting the cycle times of car repairs and, as a result, affecting insurers' costs.
On average, a collision repair shop has five technicians on staff, the research found. But these same shops reported they have lost an average of two tradespeople in the last 12 months, Jay Perry, the owner and founder of Automotive Business Consultants (ABC), told attendees at a January 2008 CCIF meeting in Toronto.
"That's huge," he added. "If you consider the initial statistic of five average techs and then you've lost two in the last 12 months we are losing a lot of people to a lot of other trades and there are a myriad of reasons for that."

The Co-operators has expanded its membership, welcoming two new members — the Canadian Worker Co-operative Federation (CWCF) and Fédération des coopératives québécoises en milieu scolaire/COOPSCO.
The new members bring to 39 the number of co-operatives, credit unions and like-minded organizations that make up the ownership group of The Co-operators Group Ltd.

Thousands of Quebecers will be travelling on the dime of an online travel risk management service, thanks to more than five inches of snow that fell at Pierre Elliot Trudeau International Airport in Montreal.
itravel2000's Let it Snow promotion offered Canadian consumers who booked a qualifying package vacation, hotel or flight by Dec. 7, 2007 for departures up to Apr.30, 2008 the chance to be reimbursed for the retail price of their vacation package if more than five inches of snow fell at airports in Calgary, Halifax, Montreal or Toronto on New Year's Day.
The online travel retailer entered into an agreement with WeatherBill, an online weather risk management service, to receive insurance coverage for the promotion.

The Insurance Corporation of British Columbia (ICBC) failed to prove an insured tried to defraud the corporation by faking the theft of his minivan, and B.C.'s provincial court ordered the public insurer to allow the claim.
In Brummitt vs. ICBC, Michael Brummitt filed a claim in June 2005 with ICBC that his 1999 Dodge Caravan was stolen from his driveway. A day or two later, the vehicle was recovered by police; the interior was extensively damaged by a fire that appeared to be deliberately set.
The theft occurred only days before the vehicle's insurance was due for renewal.
ICBC denied liability, alleging Brummitt took the mini-van or arranged with others to simulate a theft.
If a claimant asserts under oath that the vehicle was taken without his or her consent, the claimant does not have to prove that he or she did not participate in the loss, wrote Provincial Court of British Columbia Justice Ross Tweedale.
If the insurer alleges the claimant participated in the theft, that is an allegation of fraud the insurer must prove.
Fraud is a quasi-criminal allegation; accordingly, an insurer must prove fraud on a more stringent standard than simply a balance of probabilities, the judge wrote.
"Despite some aspects of Mr. Brummitt's evidence, his claim that his minivan was stolen is not highly unlikely," Tweedale found. He added that the evidence presented provided a basis for the conclusion that there were a number of ways for the Dodge to have been taken without Brummitt's knowledge.
"ICBC has not proven that Mr. Brummitt tried to defraud the corporation."

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The Insurance Bureau of Canada (IBC) on Jan. 1, 2008 is launching a project that will accurately track domestic oil spills in Atlantic Canada for the first time.
The data will be provided to governments as part of an effort to introduce and strengthen legislation for the installation, maintenance and replacement of domestic oil tanks.
"IBC is undertaking this project because there is a clear need to understand the extent of the growing problem of domestic oil spills," said Don Forgeron, vice president, Atlantic, of IBC. "While individual insurance companies have collected data on domestic oil tank spills for some time, this project introduces consistent reporting across the industry.

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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.

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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.

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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.

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