Insurance Blog

Unemployment Insurance - An Election Safety Net?

2010-04-26T03:50:00.000-07:00

The past week of electioneering and the unemployment figures released midweek by the Office of National Statistics, paint a gloomy future for many currently employed in the Public Sector and jobs that rely on Government Funding.

Whatever the outcome of the General Election on May 6th, there is risk in all the policies pursued and in the unlikely event of the Conservative Party winning an overall majority, six billion pounds of spending cuts would put thousands of public sector, particularly those in the health service, jobs at risk.

We are currently in the trough of the deepest recession since the Conservatives led us into the Thatcher generated trough of the early Eighites, and the Boom Bust Major recession of the early Nineties.

Recessions are basically measured by the level of output of a nation, it's Gross Domestic Product or GDP. Output is of course affected by demand which in turn is controlled by Government and monetary policy. When output falls we are in a recession.

The difference with the current recession is that it is not a result of a mismanaged economy or poor government strategy as with previous Conservative led recessions, moreover it is the result of a collapse of a mismanaged global banking system.

The above graph demonstrates that although we are in the deepest output recession since the 1930's, unemployment has remained relatively low up until now. This is because the current recession is a credit led recesssion where demand has been as artificially curtailed by the banking system as it was as artificially created for the housing market. Overall the state of the economy was fairly healthy!

The graph also shows that the effects of quantitive easing are working in keeping employment stable and the difference between the current stable levels of unemployment and those suffered under Thatcher in the 1980's is the difference in levels that we should expect if the Conservatives are returned to power in May.
And who is going to pay for all this unecessary unemployment?
There is no North Sea oil revenue to squander on dole queues like under Thatcher, and no new information revolution coming to help as happened to Major!

Furthermore, the largest national debt in history created by the policies of quantitive easing, is not a sinkhole to be used as a political football.
Where has all the money gone?
Quite simply into the coffers of Northern Rock, Lloyds TSB Bank of Scotland and RBS to keep them afloat.

I for one am sick to death of hearing about job cuts and job taxes when it's quite clear that it should be the Banks paying back the money they've borrowed and not profiteering off of the futures of Government bonds used to bail THEM out!

A hung parliament, the most likely outcome, will surely exacerbate the underlying trends in unemployment and it would be very prudent if you work for the Government, Civil Service, Armed Forces or Health Sector to get some private unemployment insurance in place now before the cuts start happening. Unemployment Insurance is simple to purchase online, just enter your age and the amount of cover you want to get a quote; and it will provide you with peace of mind and protect your family, income and lifestyle for a few pounds per month, no matter which colour is flying over Whitehall in May!

Car Insurance and Motor Insurance premiums reach record levels

2010-04-12T04:52:00.000-07:00

UK Car Insurance premiums reach record levels!

Well we knew our car insurance premium were always on the up but the results of the latest AA British Insurance Premium Index reveal that rates have actually reached an all time high.

In the final quarter of the year the average car insurance premium for an annual comprehensive car insurance policy increased by a whopping 7.2% on the previous quarter. In real terms this meant that the average premium is now priced at around £1,000.00 per year.

On an annual basis the percentage increase was 18.7% for comprehensive insurance. This is the largest increase in this area of business since the records first began back in 1994. Meanwhile the average premium for third party fire and theft increased in the same period by 8.9% to £1,252.00. Annually third party fire and theft rose by 23.8%.

The increases have come as auto insurers have desperately struggled to make up for a lack of reserves which have slowly been exhausted during the economic downturn. Other factors such as steep rises in settlement costs and an increase in the frequency of personal injury claims can also be attributed to the sociological effects of the recession and are also driving the premiums sky high.

The report has been released at a time that most composite insurers are either actively increasing rates or at least discussing it, but the strategies are varied and diverse.

Zurich have taken the impulsive decision to implement a blanket rate increase on its private motor book, a bold move which has certainly caught the market off guard. The Swiss insurer announced it intended to push forward with sharp increases in personal lines motor expected to be in the region of 20% in the broker channel.

Head of personal lines at Zurich's broker division, Mark Coffey said: "We have not aimed our increases at specific brokers or segments of the market - they are right across the piece. The majority of the increase will come in March and the remainder will follow in April.”

He concluded "It is an industry problem - not specific to Zurich - so I will be intrigued to see how other insurers react."

And they were queuing up to respond too…

An Aviva spokesperson commented that "no plans for blanket motor premium increases". And added that “Aviva's motor pricing strategy is still tailored to the individual - we seek to recognise better risks with more competitive pricing,"

A spokesperson for Car Insurance comparison website Car-Insurance.tv said, “ We’ve been predicting this for a long time now – the underwriting Insurance Companies can’t keep running on a loss and eating claims reserves ad infinitum.”

Meanwhile both Allianz and Axa indicated prior to Zurich’s move that they will be taking some form of corrective action also.

Gareth McChesney, head of pricing and reporting at Allianz Retail, said: "We applied some strength to our ratings in 2009. It seems others in the market are realising the severity of the situation - just six months later than we did."

"In Q4 last year, the market started to correct itself and in 2010 I would expect to see that continue, certainly for the first half of the year. Zurich has put forward a hefty increase in a single month while the market is adopting slightly smaller increases, say 3-3.5%, every month to come up to an acceptable rating level," he added.

Inevitable yes? Necessary pretty much? Helpful as we come out of recession? I let you answer that! From the pen of Insurance Blogger Kris Oldland.

Insurance Leads The Way To Global Economic Recovery

2010-04-12T03:54:00.000-07:00

UK Insurance Regulation: Geneva report suggests Insurance leads the way in rebuilding the economy

A report by the Geneva Association published this week has indicated that Insurers and Reinsurers are likely to play a mammoth part in rebuilding and restructuring the faltering global economy.
The report ‘Systemic Risk in Insurance’ has required the international think tank - which largely focuses on the insurance industry, to analyse the role of insurance in financial stability.

It would seem that the report is designed with the clear goal of raising awareness of the industry’s need to no longer be shoehorned in with other financial sectors, such as the much maligned banking sector.
It will certainly go some way to ensuring the industries voice is heard in key debates across Europe and globally, discussing how to move forward from what many fear could be the worst recession in living memory.

Highlighting the very different roles that the Insurance and Banking sectors occupy the report accurately concluded that the core activities of insurers and reinsurers posed no systemic risks due to the very nature of the industry.
The report also called upon supervisors and policy makers to now focus their attention on activities and not financial institutions whenever new regulation is introduced.

It is key factors such as; strong operating cash flows without the requirement of wholesale funding, the long term nature of insurance policies and the relative steady capacity business volumes and prices during the financial crisis which have led to the report showing our industry in such a positive light.

Using the definition of systemic risk as defined by the Financial Stability Board and applying it to the core activities of UK Insurance and Reinsurance, the report concluded that these are simply not relevant to the sector.
It was also concluded that insolvency is less of a danger to insurers as it naturally develops at a relatively slow pace meaning it can often be absorbed. Strength of the sector is the interrelationships of insurance activities means that the exposure to contagion risk is also limited.

In yet another marketing coup, Aviva hosted the presentation of the report’s recommendations, firmly associating themselves with this upbeat report.
CEO, Andrew Moss commented that “The insurance industry with its strong cash flows and well funded customer contracts is a source of stability in the financial system. These recommendations will enhance the regulatory framework, strengthen consumer protection and support the industry's capacity to provide investment to the real economy."

Meanwhile the rest of the industry has also greeted the report’s findings with the Chartered Institute of Insurance (CII) claiming the report builds on their calls for a ‘pragmatic approach’ to regulation. To be fair they have been beating this drum for quite a while now and it is a very valid point they make.

Clearly glad of some solid support in this crusade David Thomson, director of policy at the CII, went straight on the offence warning the government to be “mindful of introducing sweeping regulatory changes simply to sate the thirst of public retribution over the financial crisis.”

The CII has been pushing for the UK Government to take a far more cautious and considered approach to regulation which Insurance Blog thinks most of us would commend. However the question remains whether either of the ‘would be governments’ we have in waiting would be brave enough to not radically change the system?
Our feeling is that whoever comes in will want to be seen to be doing something, even if they don’t fully understand what it is they are doing themselves.

Yes the financial system failed – but how much of that was due to the insurance sector? And don't forget Insurance is currently underwriting all the Government debt around the World and already leading the road to recovery by supporting the Governments policy of Quantitive Easing - or bailing out the banks as it is otherwise known!

Do we really need a radical overhaul when perhaps just a few tweaks might be enough? May 6th may play a large role in this decision!

Thomson is fully prepared to admit that there will be failures but is keen to stress that “regulatory regime is there to try to ensure that there aren't too many [failures] to undermine confidence in the system or the markets. “

It is this type of realistic and responsible approach that needs to reach the next government whether it is red or blue. Hopefully the growing strength of conviction now backed up by irrefutable hard cold facts of the Geneva Report can prove enough for finally the voice of the insurance industry to be heard.

We can but hope.

Van Insurance - Stalking White Van Man is taking over the UK!

2010-04-01T06:27:00.000-07:00

You either love them or like me, hate them, but there is no denying that you can't avoid them!

They are Everywhere and You can't escape from Them!

I'm talking about the unique UK phenomena of 'White Van Man', that you will be stuck behind on every road and see parked with reckless abandon on every street corner thoughout the length and breadth of the country.

Insurance Blogger shouldn't really knock them as the 'old man' slaved away for years at the home of the Ford Transit in Swaythling Southampton, and it's an acknowledgement of 'Great British Design' that the Transit is still one of the biggest 'culprits' today!

But Why White?

Well when I was a kid the black van man was always a 'copper'!

Anyway, largely because of the Internet and local delviery, they are out there on our roads and they are dangerous, especially the stalking subset called Cowboy Builders from Barling Essex; so we had better insure them right?

We've been looking around at what's available for White Van Man and have found that the best deal to be had online Van Insurance at the current time is through Direct Line and is not available on comparison websites.
It's just been launched as a standalone product on Car Insurance Television........

Van Insurance Deals as Direct Line launches at Car Insurance Television
Car Insurance Television announce the launch of Direct Line Van Insurance who are offering a weeks free cover for the next month. Join in the celebrations today and get much cheaper van insurance instantly online.

FOR IMMEDIATE RELEASE
PR Log (Press Release) – Apr 01, 2010 – "We are pleased to announce that Direct Line van insurance has launched at Car Insurance Television and to celebrate are offering 1 day’s worth of free insurance every week. The offer lasts until 30th June 2010."

Car-Insurance.TV chose Direct line van insurance because it offers a very competitive van insurance product and provides the following benefits;

Replacement hire van available for up to 21 days following an accident or claim (If you purchase Guaranteed Hire Car Plus. Comprehensive cover required)
No charge for any extra for business use if you are the only driver.
With a Direct Line van insurance policy, you get an extra discount on every additional vehicle you insure with us.
Vandalism cover that preserves your No Claims Discount is standard (Comprehensive cover required)
If you're hit by an uninsured driver we'll cover your excess and your no claims discount won't be affected.

Direct Line van insurance customers who buy online also receive the following discounts:

Home insurance: 10%off
Breakdown cover: 25% off

You can find out more about Direct line business Van Insurance where you can take advantage of the latrest special offers and purchase all your cover online in an instant. Full Tools and Liability covers are available online.

Marine Insurance Counts the Cost of Increased Attacks by Pirates!

2010-03-30T05:03:00.000-07:00

Unbelievably Marine Piracy continued to grow in 2009, which should be a sobering thought for all us sea dogs who like to roam the seven seas.

The ICC International Maritime Bureau’s Piracy Reporting Centre (IMB PRC) has just released it’s 2009 annual report and it makes bleak reading for insurance loss adjusters and marine insurance actuaries trying to set rates for 2010.

Piracy and armed robbery incidents topped 400 in 2009.

Incredibly in these days of satellite surveillance and Type 45 Destroyers, incidents of Marine Piracy have grown from 239 in 2006 to 406 in 2009.

The total number of incidents attributed to the Somali pirates stands at 217 with 47 vessels hijacked and 867 crew members taken hostage.

Somalia accounts for more than half of the 2009 figures, with the attacks continuing to remain opportunistic in nature, with small high speed outboard land based vessels being used to pick off a certain type of easy target.

So what precautions against pirates are being taken?

All shipping and vessels in the gulf are required to transit the Somali coast in convoy with a minimum speed of 10 knots with absolutely no stops or slowing.

It is recommended to protect the boat with razor wire around the freeboard or the the lowest area of the deck.
Greased or electrified handrails have been used although the vessel owners are encouraged to use non-lethal deterrents to prevent the situations escalating.

Vessels that regularly transit the area even resort to welding doors shut and welding metal plates across windows. The return of the Iron Clads!

It's quite obvious that America doesn't want to get involved in the region after the Blackhawk incident, however it's Insurance Blogger opinion that until very stern measures are taken against the major perpetrators, these attacks will continue and continue; and the cost of freight insurance and boat insurance will rise and rise......

Meanwhile........

British Hostages Paul and Rachel Chandler, taken by Somalia Pirates, are spending their 159th day in captivity!

Hey Gordon Brown!

How about this for some political capital this Easter.......

NEWS FLASH!!!

We interrupt the Snooker final for a message from Prime Minister Gordon Brown..

" It is with great pleasure that I have to tell you that this morning a team of our finest Royal Marine Commandos, successfully carried out a mission to rescue Mr and Mrs Chandler. There were no British Casualties......"

Post Budget Blues or Pre Election Reds - Playing Risk with Your Future!

2010-03-25T05:05:00.000-07:00

So Alisdair Darling delivered his pre-election budget to a crowd of disinterested Brits yesterday and effectively opened the floodgates for the six week marathon of Polls, Accusations, Taunts, Cajolery, Calumny and Political Bollocks that culminates with you putting your X in the box of damage limitation and patting yourself on the back for being Democratic. (Especially if you are from an extremist party such as the BNP)

So what are the choices?
Hmm - A pompous inexperienced public school prat of the Harry Enfield mold with zero social conscience or a one eyed Scot with questionable religious motives whose already been given the chance to 'change' things and failed miserably in some quarters!

Yep, I can hear you all shouting that there are other choices, but my yellow friends you are kidding yourselves. I want you to all return to your constituencies and prepare not to govern!

This is a straight Two horse race like it or not - although it may, like the pathetic Lib/Lab pact of the Seventies not decide the outcome at the first hurdle.
In fact with all these Tory created Strikes and Industrial actions leading up to the election I keep getting flashbacks that I'm in 1979.... God help us all....

So today unpolitical but always controversial Insurance Blogger, nails his colours firmly to the mast and asks you the British people.....

NOT TO VOTE FOR CHANGE !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Why?

Because in case you haven't noticed the UK Economy is on the brink of slipping back into recession.

The Interest Rates need to be kept as close to zero for at least another five years if the Japanese Economy recovery experience of the Nineties is to be followed.

A Conservative Government would naturally interfere with Interest Rates and the Bank of England monetary policies.
The Conservative party simply cannot be trusted not to inflate the rates to protect their own and their core voters savings!
Look what happened to the UK the last time they were allowed to Govern!
Lest we forget that quickly?

SELLING ENGLAND BY THE POUND

The Bank of England who along with the major European Insurance Companies, are currently doing a mighty fine job of managing UK Debt.

Insurance Companies can't buy enough UK Government debt in the shape of gilts!

The last offering of UK debt this month was 3 times oversubscribed as the Insurance Illuminati rushed to defend Britain!

It looks like the UK Government are managing the debt pretty soundly!

Truth is, where else do you put your money? Greece? The Euro??

So if Insurance Companies (who BTW own everything including the banks) have faith in the Status Quo - - then So do I!

A vote for Cuckoo Cameron would be utter Madness. Cuckoo BTW because he hasn't got any policies of his own!

Answers, objections and biased opinions in the comment box below please!

X

Insurance Companies Blame 2009 Losses on Personal Accident & Bodily Injury Claims

2010-03-15T05:32:00.000-07:00

We recently heard that rising Personal Accident and Personal Bodily Injury Claims were pushing up the prices of Car Insurance premiums, now as the major UK Insurance Companies take stock of 2009 with the final quarter results, it appears that rising bodily injury claims and an unusually kind hurricane season were the two biggest factors in the 2009 results published to date.

There has been a mixed bag of results in the insurance world this week as a variety of insurance companies have announced how they have fared across the last year.
One of the biggest impacts on the industry was the phenomenal upsurge in the rising cost of bodily injury claims - partly as a result of the recession and partly due to the increase in claims farmers.

Kris Oldland gives Insurance Blog a roundup of the 2009 UK Insurance results so far..........

The insurance arm of part nationalised bank Royal Bank Scotland was heavily hit with profits collapsing by 90% with £448m reserves being set aside for bodily injury (BI) claims.
The group which includes Direct Line, Churchill, Privilege and NIG – posted a drop in net income from £584m in 2008 to £54m last year. Chief executive Paul Geddes claimed that considering their size and risk exposure, 2009 was always likely to be a tough year saying that being “twice as big as anybody else, when the market sneezes we catch a cold.”

Of course many of the major operators within the personal lines market were hit particularly badly by the rising cost in BI claims although RSA managed to reduce the damage to just £30m by taking early action to counter the rising costs.
UK Chief Exec Adrian Brown admitted that “The hit to our result is fairly small compared with some of the other numbers being thrown around.”
He added “When it comes to bodily injury costs, you have to be massively up to date on claims; they are one of the things you have to watch like hell when you are cutting expenses and headcount.”

Another company that felt the impact of rising personal injury claims was the specialist car insurance company Equity Red Star who had a strong full-year profit of A$113m eroded away by bodily injury claims. Insurance Australia group (IAG) who own the company put a statement to market that read “A lower margin of 6.6% reflected reserve strengthening for prior-year bodily injury claims and weaker investment returns, both of which have been felt across the UK industry.”

Meanwhile Allianz have grown their operating profit in the last year by 5% climbing to £203m in the last year while the combined ration improved from 95.2% to 92.9% despite the obviously tough trading conditions.
A large part of the success has been down to Allianz’s hard line stance on driving rate rises of 24%. Chief executive Andrew Torrance predicted more of the same in 2010 commenting that “It remains a priority for in 2010 to increase premium rates to a level that provides an adequate return on the cost of capital.”

Other insurers posting impressive results for 2009 were Amlin and Hiscox who both had strong years due in large to the reasonably benign hurricane season.

Amlin were able to post combined operating ratio improvement from 76% to 72% although their results were padded out slightly by £174.1m in reserve releases whilst Hiscox insurer tripled profits before tax from £105.2m to £320.6m, in what chairman Robert Hiscox described as a “vintage” year.

Another Lloyd’s insurer to triple profits in 2009 thanks to the kind hand dealt by mother nature last year was Brit who increased profits to £171m although an uplift in investment returns of £137.4m last year from £7.4m in 2008 certainly would of helped also.

........So it looks like a lot of people will be seeking big bonuses?

Apocalypse Now for Natural Disaster Insurance Claims

2010-03-15T03:09:00.000-07:00

February 2010 has seen unprecendented natural disasters and as we head full steam towards December 2012, if those Mayan descendents and crusading followers of John's Revelation are to believed, we have only just seen the beginning of the great losses as we plummet into the 'End of Days!
Yeah OK! Insurance Blogger prefers predictions backed up with slightly more statistical analysis and insight......

however , a report released this week from Aon Benfield’s Impact forecasting team has predicted that the cost of recent natural disasters is likely to cost both the reinsurance and insurance sector billions.

The capital advisory unit provided the damning verdict in the latest edition of its Monthly Cat Recap report its regular analysis of worldwide catastrophic events. A combination of the Chilean earthquake, Windstorm Xynthia and savage winter conditions across the US and Europe in February has left many in the industry feeling the financial impact.

The magnitude 8.8 earthquake in Chile, the seventh strongest earthquake ever record, has devastated the South American country and has taken the life of at least 795 people. The tragic disaster follows only weeks on from the horrific Haiti earthquake disaster which has sadly now claimed over 200,000 lives.

However, it is the impact of the Chilean earthquake which may effect the tentative recovery of the global economy as the country has far more exposure to risk than the poverty stricken Caribbean island. With more than 1.5 million homes, buildings and other structures affected insured losses alone are set to be in single figure billions of dollars whilst the economic losses are expected to reach tens of billions of dollars. (USD)

There was further suffering in South America with flooding across four regions of Bolivia killing 15 people and more than 100,000 people having to abandon their homes. It is believed that well over than 35,000 homes have been damaged. Also in the continent 20,000 homes have been damaged or destroyed in Peru due severe flooding which also affected Uruguay and Argentina.

In Europe Windstorm Xynthia ravaged Spain, Portugal, France, Belgium and Germany causing damage right across western Europe and leaving close to two million homes without electricity. The report predicts that the insured losses resulting from the storm are expected to be in excess of 1.8 billion dollars (USD)

Meanwhile the heavy rains that soaked the continent were responsible for extensive flood damage in Bulgaria, Turkey and Italy. Greece’s current troubles were also deepened with 20,000 hectares of land flooded and damage to homes and infrastructure likely to cost approximately 10 million dollars (USD). Other areas hit by torrential rain and flooding were Madeira and Spain with reports of further lives being lost in Madeira and extensive property infrastructure damage resulting in reconstruction costs which are likely to approach 1.35 billion dollars.

The US too has also suffered severe winter storms as commentators suggest that the effects of climate change are beginning to take hold. Several key regions including Washington, New Jersey, Baltimore and Philadelphia which resulted in widespread blackouts and disruption to schools, airports, roads and railways. Over 35,000 claims have been filed in the US across February totalling 125 million dollars (USD)

With plenty of insurers posting strong financial profits after the benign hurricane season last year it seems Mother Nature is intent and making herself felt once again – or are we feeling as some would have us believe the first real effects of the climate change?

Either way February 2010 will be a month that will marked in history as a tumultuous and tragic year which has resulted in heavy costs both financial term and also tragically the loss of innocent life.

End of The Line For Insurance Mergers & Acquisitions?

2010-02-24T16:36:00.000-08:00

There is conflicting evidence as to whether the UK Insurance M&A Market is contracting.
Certainly it looks like some of the much bigger UK Insurance boys are up for sale! We sent our Insurance Newshound Kris Oldland out to find out who is up for grabs; and just what is going on in the UK Insurance Mergers And Acquisitions Markets?

UK Insurance Mergers and Acquisitions: Rumours round up!

First up is Insurer Provident, who are looking good for acquisition after having had their long-term counterparty credit and insurer financial strength ratings upped from stable to positive and affirmed at BB+ by ratings agency Standard & Poor.

An S & P spokesman commented that the revision was “based on the possibility that there will no longer be any parental constraint on the ratings on Provident Insurance following its sale, thereby allowing the company's ratings to move by up to two notches to that of its stand-alone credit profile.”

Provident’s current parent GMAC has suffered a weak credit quality which has impacted upon the insurers rating.

However with the company effectively up for sale the parental constraints are less likely. S&P's credit analyst Nigel Bond commented "The outlook also continues to reflect our understanding that the company's financial strength will be protected to a significant extent by its supervisor, the UK Financial Services Authority.”

Bond also added “If the sale does not occur, or the financial strength is not adequately protected, it could lead to a negative rating action."

Meanwhile the Kwik Fit Financial Services (KFFS) is looking to be sold for the fourth time in just over a decade.

French private equity firm PAI Partners have put a £200m price mark on the company after contracting Credit Suisse to perform a strategic review of their current business operations. However, it would seem that they won’t have to look too hard to find a suitable buyer with insurers, brokers and rival private equity firms all being rumoured to be voicing an interest in the private lines motor insurer.

Managing Director of KFFS Brendan Devine commented “KFFS is now a major financial services organisation; it is getting fart to big to be part of what is a tyre and exhaust company”

The insurance company recorded an £82.7m brokerage in 2008 ranking it as the 15th largest broker according to IMAS and also includes Green Insurance Company and motorbike specialist Express.

Getting back into the acquisition trail are Kerry London who are in good shape after rather smartly side stepping the difficulties suffered in the construction sector and diversifying to maintain a healthy cross sector portfolio.

Following on from the launch of an MGA with Fortis in May last year in the sports and leisure field (which is currently operating 20% above predicted revenues) Kerry London have posted impressive figures for the last year with annual turnover up to £15.9m in 2009 and a bank debt being reduce to £5.75m from £9.3m.

Despite an embarrassing “oversight” which led to a winding up order being served due to a failure to register full year accounts for 2008, the company are bullish about being in a good position to get back on the hunt for new acquisition and have confirmed that they have brought in a specialist adviser to work on their acquisition strategies.

Household brand E-Sure has also been snapped up recently by E-Sure founder Peter Wood backed by Private Equity firm Tosca Penta Investments and Electra Partners.

Mr. Wood founded the company in 2000 with the support of Halifax which has since become firstly part of the Bank of Scotland group and subsequently became part nationalised as a direct result of the recession. He has now taken a 70% stake in the company once more.

Taking an immediate step away from HBoS any existing policies underwritten by E-Sure will now be passed back to Halifax on renewal.

A spokesman said “As we are now independent it does not make sense for us to underwrite a Halifax named brand.” However, the existing deal between E-Sure and Sainsbury’s is likely to remain in tact despite originally being a joint venture between Halifax and the Supermarket giant.

“Everything is the same except one major shareholder has been replaced” the spokesman added regarding the Sainsbury’s deal. “The Sainsbury’s contract is still at E-Sure”

Finally, Lloyds broker RFIB’s new chief exec Marshall King has also indicated that he expects them to become acquisitive in the near future, although he is shying away from the seemingly mandatory desire to float on the London Stock Exchange just yet.

After a successful Private Equity backed MBO just under three years ago RFIB have had a phenomenal success posting a 73.52% annual profit growth to £6.06m last year. Now it appears that King wants to move them into the next tier. “Will we consider acquisitions in the future? Yes we will. When you get to a certain size then it makes sense to take slightly bigger bites if there is a good fit.” He said adding that he would be “surprised if we do not make one or two [acquisitions] in that time”

With Pricewaterhouse Coopers currently reporting M&A levels have dropped throughout the financial crisis by a staggering £30bn/year since the halcyon days of 2007, one could be forgiven for taking this brief flurry as an indication that we are starting to get back on track.

And with the onset of Solvency II possibly providing a catalyst for a further rise in M&A activity in the industry, as capital providers from a wider range are enticed into a well structured and regulated industry, then maybe, just maybe we may be getting ourselves back on track?

Hmm, Intersting stuff Kris! Insurance blogger then phoned up Insurance Mergers And Aquisitions specialist Anne Moran of Insuretec, who confirmed our suspicions about the UK Insurance Brokers Market.

She told Insurance Blog,

"We are seeing much more activity on the buying front, from Insurance Companies who are seeking to purchase insurance brokerages and accounts, offering both exits and continual active roles, making the offers available both more flexible and attractive to the seller."

"Insurance companies are looking to build and strengthen the brokers they are purchasing."
Sellers have many options available to them now. Our introduction service is free to all sellers and we help make the options available to them."

"Brokers are still active purchasers, looking for varying areas of insurance portfolios and brokerages."
"Wholesale and underwriting agencies are back in demand."
" We always have a demand for property owners, quality commercial large or small, household and motor( especially specialist)throughout the UK so if you are considering selling or looking at other options please talk to us first at http://www.insurancebrokersellers.com "

Ooh Yes! Churchill The Car Insurance Dog Soft Toy Outsells The Meerkat

2010-02-18T07:41:00.000-08:00

The holding company of Churchill Insurance, RBS, whose future remains in doubt, must be pleased as punch to learn that sales of the Churchill nodding dog soft toy were ten percent higher than those of rival car insurance comparison website Compare the Market over the christmas period, according to figures released today from the Association of British Toy Distributors.

Buy The Churchill Dog

Before they all go barking mad down at Churchill, it should be pointed out that the figures relate to sales of the bulldog stuffed toy against those of Alexsandr Orlov the Compare The Meerkat main character.

Alexsandr Meerkat was only available through Harrods and supplies were restricted according to Benja Katya who runs the online Meerkat Toy Store in partnership with Amazon.

She told Insurance Blogger. "The dog is now a part of British Culture and sales of the toy will enjoy longevity despite who owns the brand."
"Meerkat Toys are becoming more popular everyday and the interest is spreading globally. Much of this must be attributed to the success of the Compare The Meerkat TV and Internet Social Media Marketing Campaign. Ironically the Meerkat phenomena which started out as peculiarly British thing has spread as far as Namibia!"

The idea is seemple and not a new one either!
Remember the Nat West piggies?
With Social media here to stay as part of the Insurance Marketing mix, it looks like the Insurance logo soft toy spinoff market is a very lucrative source of extra income for cash strapped Insurance Marketing departments.

Insurance Blogger wonders what furry animal will be next to capture the hearts of the Britsh Car Insurance buying public?

Insurance Marketing : NewTools For A Modern World

2010-02-16T05:16:00.000-08:00

When the World Wide Web opened up the Internet for everybody nearly twenty years ago, one of the phrases that was bandied about at the time was that this new 'Information Superhighway' would be a level playing field where small could shout as loud as large.

This caused an initial flurry of activity by prescient insurance companies and a few savvy brokers, who bit the bullet and jumped into Internet Insurance transactional business, prior to the dot-com boom.

The playing field was not so level and over the years it appeared to Insurance Blogger that the online marketing spend and efforts of powerful Insurance Companies and a few brokers, had skewed the playing field further, and Internet Insurance Marketing had become a mirror of the physical world where he who spends the most gets their brand seen. The situation has become exacerbated by the dominance of price comparison sites and premium aggregators as further barriers to a successful Internet Insurance Marketing campaign by a small insurance broker, for example.

Insurance Brokers have felt particularly left out of the new wealth, as on the whole, they do not have the marketing budgets to fight back against the established big boys.

However recently there has been a massive shift in the Insurance Marketing paradigm which is allowing 'those in the know' to not only compete with the big boys but to retake the marketing initative and establish online market dominance for their chosen niche markets!

So how have they done this?

Well everything has changed in the world of Insurance Marketing with the arrival of Social Media Marketing. It appears it is no longer a question of buying attention for your brand by spending large amounts of cash, moreover a skill in engaging with your customers as communities, and a provider of information that is valuable. As experts with superior knowledge of their Insurance niches, Insurance Brokers are fighting back and winning the Insurance marketing war using the traditional skills of networking and information.

So how do they do this?

We asked the UK's leading consultancy in the use of these 'new tools', Speedie Consultants, just what do you need to do today to establish visibility on the Internet?

What is Twenty First Century Insurance marketing?

Here's what the Speedie Consulting's managing director and world reknowned Insurance Internet Marketing Coach, Jason Hulott, told Insurance Blog......

"Insurance marketing" , "web content" and "affiliate marketing" – these are all phrases that you may or may not be familiar with. However, these – and other marketing solutions – are key to boosting your business, both online and offline.

If you are looking to generate more business via your website, then it’s not a simple case of putting up a few pages and keeping your fingers crossed. No matter whether your finance and insurance business is based all online, or offline, you need to market your website through a number of several tried and tested methods, as well as keep ahead of your competitors as new marketing methods develop (eg social media).

Combined internet marketing and copywriting specialists Speedie Consultants Limited offers five main solutions for your finance and insurance marketing needs:

· web content

· article marketing (including link building)

· blog set up and marketing

· press release syndication

· affiliate marketing

Each of these elements are designed to maximise your exposure to potential clients. Speedie Consultants can tailor their service to meet your needs whether you want the comprehensive package or just one or two elements. A consultancy service is also available.

History

Speedie Consultants was established in 2003 by Jason and Stella Hulott, which sees them offering over 40 years’ combined experience in the internet marketing and copywriting industries. Supported by 15 freelance writers, a web design company and a web development team, they currently provide between 500,000 and 700,000 words of copy each month and can boost your business with finance and insurance marketing; the provision of web content; and affiliate marketing.

Jason’s background is in internet marketing – predominantly finance and insurance marketing - where he worked for the Woolwich before joining the UK’s first personal finance web aggregator in 2001 as a Content and Partnership Manager. In 2003 he set up Speedie Consultants, primarily providing internet marketing (including affiliate marketing), copywriting services and PR distribution services to finance clients such as Budget Insurance and British Insurance as well as non-finance clients such as MakeFriendsonline.com.

Stella is a PR and Copywriting specialist providing unique, quality web content. She has worked for Liverpool Victoria, Pearl Assurance, the Woolwich and the Foresters before co-founding Speedie Consultants Limited. Stella has written for major UK Finance and insurance websites such as TescoCompare.com, GoCompare.com, parts of the Towergate Partnership, British Insurance, Enhanced Wealth, Burgesses and Protection Insurance plus many more.

Speedie Consultants can provide clients with a comprehensive service that allows you to enhance your presence both online and offline. Their consultancy service offers you the know how to do this, as well how to effectively:

· run affiliate marketing programs

· provide relevant, SEO friendly web content

· create and manage niche blogs

· write and syndicate articles for SEO benefits

· make the most of your finance and insurance marketing tools.

Thanks Jason, there's obviously a lot to take on board in this Insurance Marketing Brave New World. Insurance Blogger thinks that Budget Insurance's 'Compare The Meerkat' social media marketing campaign has a set the standard for a whole new wave of customer insurance marketing and interaction. Once again it looks like those who embrace this new media early will be the long term winners!

Watch this Space!

Euro On The Point Of Collapse - Victim Of A Trojan Horse?

2010-02-11T19:44:00.000-08:00

If the Franco-German alliance fails to bail out the Greek debt then the Euro will most certainly collapse!

Mass Devaluation.

Cheap Holidays in the Sun!

Suddenly Europe will not be worth half as much as it was!

Worse still for the Euro Bankers is the fact that the amount of Greek debt appears unquantifiable due to some smart bookeeping by the previous conservative government who were incumbent for most of the credit crunch and the subsequent recession.

This is not going to impress those financial entrepreneurial illuminati who have their money tied up in the Euro and itchy fingers on the sale button!

Europe is supposed to be growing itself out of recession faster than the UK or USA.
Some say that this is a mirage and was a temporary bounce due to the Eurobankers encouraging consumer spending coupled with the christmas seasonal factor.
The overall trends appear to be down!

If the Euro collapses on the money markets, all participants will pay the price of the Greek tradegy.

I can already hear the British Euroskeptics say 'I Told You So!' as the Irish economy collapses.

So what will it mean for the UK and in particular the UK Insurance Industry?

Well Insurance Blogger thinks it could be a very good thing for the UK financial services industries as a whole.

After all when the Money markets sense a tsunami coming; the smart money always runs to the safest shores!

Of course the right wing euro-sceptics will claim victory in the advent of a Cameron led election victory; but the real praise must go to Gordon Brown and Barack Obama for not following the Euro pump priming recovery route.

UK Insurance Regulation Is Changing The Face Of The Market

2010-02-10T02:51:00.000-08:00

In 2005, two years before the credit crunch, the British government imposed far reaching financial and structural controls over the UK Insurance Market by bringing the sale of General Insurance into the controlling hands of the Financial Services Authority, the FSA. Legal regulation and authorisation for the first time of the sale of UK personal lines and commercial risks.
Anyone large or small who wishes to market and sell the majority of insurance products in the UK must be authorised and regulated by this very large Quango.
Prior to this the UK Insurance industry was self regulated through professional bodies.
Five years on, what has this meant to the way we buy Insurance as consumers in the UK?
The regulation has certainly had a large impact on the available distribution channels, with a contracting market and barriers to entry.
Although regulation came into force during a period of Insurance broker consolidation and aggregation coupled with skewed figures due to new entrants from the Internet, it appears that our old friend the high street broker is the one to have suffered the most.

The problem with metropolis style regulation is that there is no point having it unless you have enforcement.
The UK Insurance Industry likes to use the nice word compliance as a synonym for the cost.

This has breed a whle new industry in itself, outside of the additional thousands of pen pushing bureaucrats in the FSA.
Compliance, generating a whole new industry and wealth base....the compliance officer or consultant.

The problem is ... it hasn't generated any wealth has it?

Where's the money for all this compliance come from?

Out of the pockets of the Insurance companies involved!

And where do you think that money is going to be retrieved from?

Quite Right! Higher Insurance Premiums for me and You!

So what we initially thought might be a boring insurance story has turned out to be very intriguing.

What's happening in the world of compliance and Insurance Brokers?
we thought we'd catch up...........

Insurance Blogger Kris Oldland Reports...

Regulation and Compliance: FSA Fees a “burden on smaller firms” Says Institute of Insurance Brokers’s Bradshaw

I imagine that there are no small amount of insurance brokers out there at the moment wondering what on earth they have done to upset the financial authorities so much.

First we see her majesties wonderfully efficient revenue and customs chaps getting it completely wrong with Insurance Premium Tax and piling unnecessary and unwarranted taxation on the broking sector. Probably too busy trying to doubling erroneous tax bills to pay to much attention to what the role of the humble broker is.

But like the pantomime baddy that tries to steal every scene in the show in wade the FSA to show these clowns in the HMRC that when it comes to completely missing the point and costing brokers a lot of time, money and emotions – they have the market cornered by proposing a minimum regulatory fee of £1,000.

As they have done so many times before they really seem to have tried so hard to do the right thing but somehow just managed to get it so wrong. The move to review the fees and levies structure is the correct thing to do, but it needs done in a considered and intelligent manner.

When will the FSA understand that sometimes a one size fits all approach to all things financial just doesn’t work. Sometimes that square peg just won’t fit into that round hole – no matter how hard you smash it with that sledge hammer.

Well they’re in trouble now because Barbara Bradshaw, chief exec of the IIB and defender of the humble broker has the FSA in her sights. For the record I think that Barbara is a wonderful and very likeable lady, that said I wouldn’t like to get on the wrong side of her either, she is also a very powerful and determined lady who strikes me as being able to achieve anything she puts her mind to.

Referring to the proposed minimum fee as ‘totally disproportionate’ Bradshaw went on to comment that the fees were likely to become a major ‘burden for the smaller firms’

She added “While we welcomed the FSA's commitment to review the fees and levies structure, we're nevertheless concerned that the proposals really do penalise the smaller broker. The FSA's proposed fee structure means many smaller brokers could face up to a 200% increase."

Showing a complete lack of understanding for the complexities of the broking community as well as fundamental disregard for the smaller brokerages the FSA have claimed in their consultation document ‘Regulatory fees and levies: policy proposals for 2010/11’ that "These proposals simplify and significantly increase transparency as it is clear what the minimum fee covers and why”

The document goes on to later state that the new system will “be fairer as the basis for calculating it will be the same for all firms." Again they are so close to getting it right aren’t they? Again the theory behind it sounds like it is ticking all the right boxes but the delivery is just far too heavy handed.

The biggest worry is if we get rid of this incompetent lot, who are on earth are we going to get to replace them? Part of me would say that its better the devil you know. Perhaps if they just started listening to people like Barbara, Eric Galbraith or even god forbid a few insurance brokers, they may actually be able to make the leap from having good ideas to actually doing some good? But can we afford to give them the time to learn from there mistakes when their mistakes are costing us so dearly?

Sort ‘em out Barbara for all our sakes.

Don't Renew Your Car Insurance Until You've Read This!

2010-02-06T05:20:00.000-08:00

If like me you've recently had you car insurance renewal documents land on your doormat, you might be in for a very unpleasant financial surprise!

How Much!! You've got to be joking!!

Nothing had changed as far as I was concerned, the car is the same, the road I live in is the same, I still do the same job - the risk hasn't changed at all.
The only difference is that I'm one year older and I thought cover was supposed to get cheaper the older you got!

So what can you do to avoid the rate hikes?

I asked my friend and underwriting expert Dave Healey for some advice. Here's what he said....

Compare Car Insurance Quotes Online Before You Renew Your Policy

The cost of car insurance premiums are expected to rise dramatically in 2010 with some major insurance news sites predicting up to 20% in premium hikes as the industry adjusts to large losses and claims in recent years

However the competition remains fierce and those who bother to take the time shopping around and comparing prices from different companies will benefit while those who cannot be bothered will pay the price at renewal.

You have probably heard the phrase 'brand new customers only' applied to the television adverts that constantly bombard us with deals and offers for cheaper cover.

Nearly all the major car insurance providers in the United Kingdom are offering incentives to get you to move from your current insurer and take out a policy with them. You will need to check out these offers carefully and be prepared to take the time and effort to understand the 'catches' if you want to successfully reduce your premium each year.

There is no logical reason why your premiums should rise at renewal unless you have had claims, but if you stay with the same insurance company year on year out of inertia, you can virtually guarantee that you will be paying more to cover the costs of the incentives offered to the 'new business or the claims of other people who are insured with the same company.

In the UK car insurance companies seem only concerned with how much volume of new customers they can attract and once they have your premiums you are no longer of interest to them. So if you want to save money on your car insurance it is necessary to change insurer every year!

About a month before your renewal date you should receive from your existing company an invite to renew, which in most cases will be automatic unless you cancel the policy. This is the time to start looking elsewhere for cheaper quotes for the same level of cover. Most quotes are legally valid for thirty days from the date they were given, which will allow you plenty of time to compare the car insurance market before cancelling your policy and obtaining cover elsewhere. The invite to renew document will also contain proof of your no claims driving history and the number of years discount you are entitled to. Keep this document safe as you will be required to produce it when moving to another insurance company as proof of no claims.

Compare and Move!

The best place to start looking for cheaper car insurance is on the Internet Car Insurance comparison sites of which there are many. Choose at least three different price comparison websites to get quotes from; they usually only take a few minutes to complete all your details to get a range of quotes.

Be aware that the number of comparisons they make and the premiums quoted often vary dramatically from one car insurance comparison website to another.

Often the comparison sites may have negotiated different rates with the insurance companies for certain types of customer or car as all car insurance companies have target markets.

To find one which may be more suitable for your needs it is advisable to search online for compare car insurance for your particular make of vehicle. If you have a poor driving history, drive an unusual or classic car or need specialist cover there are now many smaller specialist comparison sites that cater for all these needs.

Once you have found an alternative cheaper provider, make a note of the quote and return to the website just prior to when your existing cover runs out. Be sure to clear down the cookies on your computer's browser, otherwise the company will know you have been quoted before and only offer you the same deal. That way you ensure that you will get any of the latest incentives and discounts when you purchase the cover.

Car insurance can be bought to start from your renewal date and you should return your certificate of insurance to the old insurer once you have found alternative cover. Telephone your existing Insurance company and tell them you are cancelling the cover and will not be renewing. Without doubt they will ask for your reasons. Tell them that they are too expensive and that you have found cheaper cover elsewhere. If you have been a good customer and not claimed, you may be surprised that many will offer to beat or at least match the premium you have been offered elsewhere, which would save you the trouble of moving and cut your motoring costs!

Public Sector Employees Facing Redundancy Should Consider Unemployment Insurance

2010-02-02T03:43:00.000-08:00

With the recession officially over and 0.5 percent growth in the last quarter of 2009 you might be fooled in believing that unemployment is a thing of the past.
The grim truth is that every day up and down the country people are still losing their jobs in the thousands.

For the Public sector this must be a worrying time. Whoever gets into power come the elections in May, will make public sector job cuts their first priority in order to reduce the massive National debt accrued by so called quantitiive easing.
Civil Servants need to ACT NOW! if they are to protect themselves from redundancy come the Summer of 2010.

Dennis Haggerty Fellow of the Chartered Insurance Institute (FCII) from lifestyle protection company iprotectinsurance explains.........

Up until now, Public Sector jobs have largely escaped the ravages of the recession. Although for Defence related jobs, budget cuts have already begun to bite. Because of this, many Mortgage Protection and Income Protection Insurance providers are currently turning down applications from people who work in the Defence industry, believing they now represent an exceptional level of risk. What is meant by risk? The Underwriters think in terms of the number of redundancies made by a specific employer proving much higher than average. The same view is taken about people working for several Councils currently implementing staff reductions.

"Therefore, it is probably the last chance for the majority working in the Public Sector to buy this type of insurance, before the deep post election budget cuts begin."

State benefits are pitiful compared to the real cost of living for the average family or young couple living in the UK today. When denied their ability to earn a living wage by accident, sickness or unemployment, everyone needs money to fall back on. The fortunate have savings, however the majority will find themselves in real financial trouble within weeks. Research published in 2008 established that most people of working age have less than 2 months wages saved, with 25% reported to have nothing at all. This applies equally to Public Sector employees. Therefore, having an insurance policy that covers all important bills whilst out of work, makes a great deal of sense. For those that need this insurance, get it now before the Underwriters say 'no thanks' to all Civil Servants, Local Authority and Health Service employees.

For anyone employed full time (at least 16 hours per week) in the Public Sector and where there are not any reports of any impending threats to jobs, it would be prudent to consider getting a quote right now. If a Government Department or Council for example, has made an announcement regarding cut backs, a recruitment freeze or layoffs, it is probably too late to buy this cover. Without any doubt, now is the time to get a low premium deal, rather than wait for this cover to rocket in price, or applications to be simply denied altogether.

Even those who already have this type of insurance, perhaps just covering a mortgage or a single loan, should check if they have sufficient benefits. For working couples, particularly where the main wage earner is employed, say, by a Local Authority, it could be prudent for them to take out additional low cost cover whilst it is still on offer.

Mortgage Payment Protection Insurance (MPPI) is designed to cover monthly mortgage payments and can usually be increased by up to 25% to contribute toward other expenses related to the home.

Income Protection Insurance (often called Lifestyle Protection) is very similar to MPPI, however it is designed to replace the majority of net income if the person insured is unable to work. As it pays out for up to a year it is more accurate to describe this as short term income protection insurance. It is not limited to mortgage repayments. However many providers cap their maximum monthly benefits at £1500, some £2000. It is rarely more because the Underwriters make the assumption this would be enough for most buyers to pay their monthly bills.

Most buyers tend to be only be interested in unemployment cover in the mistaken belief health related benefit is less important for them. However there are relatively few providers of unemployment only cover and frequently their competitors will offer full Accident Sickness and Unemployment cover for less! More importantly with 2.4m people in the UK claiming Disability Benefit (Dept of Work and Pensions 2008) the risk of health related claims is greater than many think.

The best rates are available on line where Income Protection and Lifestyle Protection Insurance can be bought without the expense of telephone sales or high commission to inflate the price. Moneysupermarket are a good source of comparison quotes, however the summary of cover should always be read very carefully to ensure what each provider offers for the price, really is like for like.

A web based comparison service is provided by the FSA. This is entirely independent and not trying to sell anything. Their tables also include quality measures, although as a result they are quite complex and therefore not easy to use. However they represent a good place to research a shortlist of suppliers to compare quality as well as price.

Applying for Income Protection, Mortgage Protection or Payment Protection Insurance on-line is a great way to save money. However the acceptance criteria applied by different underwriters varies. If applying on-line does not work out, it may simply mean the applicant is one of many who need advice regarding what to buy.

UK Earthquake Insurance - Make Sure Your Buildings Insurance Covers It!

2010-02-01T11:39:00.000-08:00

With all our thoughts over the last month focused on the devastation caused by the earthquake in Haiti, Insurance blogger has investigated the risks to UK homes and property from earthquakes.

You might think that because we do not live in a littoral area of plate tectonic activity, that seismic activity would be minimal, and the risks would be negligible....

However recent trends in the UK have shown the importance of making sure you have this peril covered as part of your basic buildings insurance policy.

On 28th April 2007 an Earthquake measuring 4.3 on the Ricter scale hit the small coastal town of Folkestone in Kent.

The earthquake's shallow depth and proximity to Folkestone resulted in structural damage in the town, and one woman suffered minor injuries.
Following the earthquake, a total 474 properties were reported as damaged with 73 properties too badly damaged for people to return to, 94 seriously damaged, and 307 suffering from minor structural damage. The Association of British Insurers estimated claims to be in the region of GBP30 million. Only 40 percent of the properties damaged were insured!

It was the largest earthquake experienced in the UK since the 2002 earthquake in Dudley in the West Midlands, and the strongest in the active English Channel / Dover Straits region, since a magnitude 4.4 earthquake in 1950.

The strongest recorded British earthquake was the 1931 Dogger Bank earthquake which measured 6.1 on the Richter scale. Shock waves were recorded across the continent of Europe and Tsunamis hit the East coast of Britain and extended as far as Calais in France causing localised flooding and property damage.

The most destructive earthquake on record in the UK occurred in 1884 in Colchester in Essex. In total the earthquake damaged around 1200 buildings and killed five people.
In 2009 Folkestone was shaken by a smaller magnitude 3.0 quake, located in the same area as the 2007 quake.

Depending upon the intensity of the quake and the following effects are typically experienced in UK earthquakes.
European Earthquake Intensity Scale
3 - Felt by few
4 - Felt by many indoors, windows and doors rattle
5 - Felt by most indoors, small objects fall over
6 - People run out in alarm, slight damage to buildings (plaster cracks)
7 - Moderate damage to buildings (chimneys fall, cracks in walls)

In the UK the areas where risk is higher than average include the West Highlands of Scotland, an arcuate zone running from west of the Pennines from Carlisle to Pembroke, NW Wales and W Cornwall. to the East, keny and East Anglia experience the most shocks.

Distribution of Earthquakes and their magnitude in the UK

The places in the UK with lowest seismic hazard are Northern Ireland (especially the western counties), NE England and outlying parts of Scotland, including the Orkneys and Outer Hebrides.
All UK Building Insurance policies cover Earthquakes as a basic peril and inlude total loss cover.

Getting Married? Wedding Insurance May ReduceThe Pre-Nuptial Stress

2010-01-23T04:48:00.000-08:00

Insurance Blog would like to congratulate one of our regluar contributors Kris Oldland and his new Mrs, who recently tied the knot and took the plunge!
Well we couldn't let him get away with not writing about his experiences so as soon as he got back from honeymoon we asked him ..........

Is wedding insurance a worthwhile product or is it just another expense to add to the list?

Well, as a newly wed here is my first piece of advice for those who have decided to take that stroll down the aisle.
Within reason don't think about the expense, this is a once in a lifetime (hopefully!) occasion, the happiest day of your life and the memories that you make on this magical day are memories that will last you a lifetime.

The second piece of advice is for crying out loud get yourself insured!

The average wedding in the UK is now apparently £17,000 you can pick up a fairly robust premium for a cost starting at around just £30. This ladies and gentlemen really is a complete 'no-brainer'.
Set a date, make the necessary bookings, arrange your wedding insurance cover and then start paying your deposits.
Get it done early and it is one less worry. Trust me there will be plenty of other things to worry about during the build up and on the day!

Even if you are thinking of not spending quite so much then a specialist wedding policy is still worth very serious consideration - you may be planning a small, intimate affair, but it is probably fair to assume that you will be buying some of the most expensive dresses, outfits and meals you have ever bought.

However, as with any form of insurance it is important to understand what your existing exposure to risk is before purchasing additional cover.
One suggestion is that to make payments on credit card where possible (although always make sure you can clear the balance immediately). Any payment between £100 and £30,000 can be claimed back through section 75 of the Consumer Credit Act if there is a problem with goods or services.

Also, many home contents insurance policies increase cover for a month either side of the wedding of someone in the household to cover wedding gifts and sometimes items bought for the wedding. Check your home insurance policy documents for details.

What you really need to be looking for in your wedding insurance policy is cover for loss of damage to the wedding attire, such as the wedding dress, as well as presents, the wedding cake, rings, flowers and gifts for the guests.

Most often cover starts a set period before the wedding and finishes a set period after - from seven days before to 24 hours after for wedding gifts, for example - but this will vary depending on the policy. Also you'll be relying on wedding services from a range of providers so make sure your wedding insurance can cover any extra costs you incur up to the policy limit if things don't go exactly to plan.

Wedding insurance also covers you for deposits you can't recover or the cost of arranging alternatives if suppliers go bust (but don't forget that you would already be covered by section 75 if you paid by credit card so do not pay an unnecessary premium if you have an option to opt out.)

The other important area to have covered by your wedding insurance is personal liability for injury to third parties or loss or damage to third party property. Again this is often covered either by your home insurance or the hotel's own cover etc but this can be quite important if you have the wedding in a public place such as a beach or park etc.

There are additional areas of cover, some policies offer legal expenses, personal accident or even stress counseling but these really need to be tailored to your party's individual needs.

The Internet has made it easy to purchase and Compare Wedding Insurance online, and you can save money both by shopping around and by visiting a specialist events insurance company, who often have better value for money products with a wider range of wedding insurance covers.

Wedding Insurance Article Source:

Compare Caravan Insurance with new quote comparison website

2010-01-18T08:28:00.000-08:00

With the evenings starting to get longer and the ice melting it is time to think about your Summer holidays!
for those of us who take to the open road every year or own a holiday static van by the coast, Caravan Insurance is a modern must have...
Hope fully Caravanners will be able to save lots of money this year with the launch of a new site that allows users to compare caravan insurance quotes from over 20 suppliers.

Specialist Caravan Insurance comparison website launched

Insurance comparison website specialists, Insuretec Ltd, have announced the launch of a new site that compares Caravan Insurance quotes from multiple UK suppliers. All risks cover for static and touring caravans is available through the online system

Compare Caravan Insurance

FOR IMMEDIATE RELEASE

PR Log (Press Release) – Jan 18, 2010 – Getting the best quote for Caravan Insurance should now be a whole lot simpler thanks to a new website http://www.caravaninsurance.info
The website compares caravan insurance quotes from all the major suppliers and independent specialist insurance brokers and allows you to purchase cover instantly online.

Dave Stacey, caravan insurance director at Insuretec said,
"In the past it has not been easy for owners of touring and static caravans to get the best deal for their caravans, and in some cases not even the best or adequate cover. This was due in part to the fact that many owners bought their caravan insurance directly through the the club or association to which they belonged and were discouraged from shopping around for insurance deals. Insurance brokers at large, did not have access to these specialist schemes and were not able to offer their caravan owning customers the best cover."

"Our online system is simple to use and you can obtain a quote for your caravan in under a minute. You simply have to enter your caravan's details once and a few facts about how you use the caravan and our system passes the data to a central electronic exchange to retrieve the very best rates and covers, for virtually every make and model of caravan on the UK market."

"Large online discounts are available and incorporated in to the quotes returned. There are additional savings to be had if you are a member of a recognised caravan club or have improved caravan security. "
We estimate our customers will save in excess of twenty five percent of their current annual caravan insurance premiums!" He added.

To try out the new caravan insurance comparison system for yourself, where you can also purchase cover for mobile homes, park homes and towing vehicles; visit the website at http://www.caravaninsurance.info

How Insurance Companies Use Your Credit Rating To Decide Your Premiums

2010-01-13T14:09:00.000-08:00

UK Insurance Companies have been using credit scoring to determine policy acceptance, flag potential claims risks and load premiums for over ten years now.

What this means for the consumer is that if you do not fall into the credit/lifestyle brackets determined by the credit rating companies and identified by the Insurance Companies as the most profitable people sectors for their particular products, you will be either declined cover or offered it at a loaded rate commensurate with the amount of extra risk that the lifestyle group that you fall into presents, and designed to deter you from taking up cover.

In other words if you aren't what the insurance companies are looking for.... they don't want your business!

Here are the examples of the Experian Groups of type of person that YOU are! These are used for what is known as 'customer segmentation'. For Insurance purposes these are then grouped into four quadrants.

Low Conversion / Low Risk of Claims - An Insurance Company's desired customers
1. Wealthy Retirement
2. Mid Life Affluence
3. Surviving Singles
4. Elderly Deprivation

Low Conversion / High Risk of claims - An Insurance Company's least preferred customers
1. Ageing workers
2. Happy housemates
3. Credit Hungry Families
4. Advancing Status

High Conversion / High Risk of Claims - The customers an Insurance Company would like to be rid of
1. On The Breadline

High Conversion / Low Risk of Claims - An Insurance Company's most preferred customers
1. Gilt Edged Lifestyles
2. Modest Mid Years
3. Successful Starters
4. Flourishing Familes

So.....which one are you?

In the UK credit scoring was first introduced in the household and car insurance markets in the late 1990's.
It is important to remember that credit scoring in the UK as carried out by 'big brother' credit scoring company Experian plc, is postcode and not people centric.
Where you live is the database primary key!

Nothing much has changed in the last decade with regards the database structures with the exception of the amount of data that Experian holds on each and every one of us and how the data Experian holds on each and every one of us is used!

When a customer applied for home insurance in the 1990's, the insurance company collected the data regarding all new policyholders and sent the extract overnight to Experian. Experian then took the extract and applied it to its credit scoring database and sent the file back a day or so later with the credit scores for the applicant attached. The Insurance companies could then use the database to see the likelyhood of claims by the type of people they'd underwritten the policies for.

At renewal those likely to make a claim could have their premiums loaded to discourage renewal and in theory protect the fund.

That is if you believe the Experian categorisation of propensity to claim!

When I first was asked to design these systems I thought that propensity to claim by lifestyle had some merit, for example young drivers, but to judge someone by the house the live in, job they do, credit cards they hold, and nowadays even by the school reports they were given... as being rational variables in a model to determine propensity to claim....was complete and utter bullshit... and I still do!

Yes Big Brother Experian even holds your school reports these days and it won't be long before they get your medical records as well.........

Thanks to the Internet and Experians new offshoot company Hitwise, all these things can be done online and the decision to offer insurance made instantly.

If you'd like to see an interesting if flawed analysis by Experian of the UK Insurance Industry online for 2009, but more importantly an excellent demonstration of how Experian data is used by UK Insurance companies to bracket and categorise each and every one of us before deciding how much to charge us in premiums...... - watch this!

UK Insurance Mergers & Acquisitions: Could HSBC sale see Marsh and Aon on par again in 2010?

2010-01-13T03:45:00.000-08:00

As 2010 warms up Insurance Blog has let resident Insurance journalist Kris Oldland give his UK Insurance insiders view as he plays Nostradamus with HSBC Insurance Brokers.....

In a year that has seen considerably less Insurance Mergers & Acquisitions activity than we had become accustomed to in the latter half of the noughties, the UK Insurance press at large has seemed occasionally a little desperate for gossip. So when one company keeps returning to the forefront of the latest trade press pages we can’t be blamed for thinking that we may have heard it all before…

However there is a certain persistence in the continuing rumors that Marsh are intent on purchasing HSBC Insurance Brokers to make me think that there could be just the tiniest hint of truth behind all this.

Of course from a strategic point of view it would make absolute sense for Marsh to make a bid also.

The market speculation is that Marsh has offered to buy the bank’s broking arm, HSBC Insurance Brokers. The inference that is being made in somewhat hushed tones however, is that this is all just part of a wider strategy by Marsh to get the banking giants on side. The long-term aim it is suggested is then to broker an affinity deal with the bank.

To date both companies have refused to comment on the speculation despite the rumor being reasonably widespread for some time now.

What is clear though is that a decision of HSBC to sell the division would fit in with plans for a wide reaching shake up of its insurance operations. In the previous financial year the bank disposed of its insurance operations based in

Malta

, Guernsey and Bermuda. The latter being perhaps the most telling move of all that the bank sees insurance as becoming non-core to their overall strategies.

Then as if further re-enforcing this position HSBC Insurance made the announcement that it was to cease underwriting motor insurance completely, swiftly putting HSBC Insurance (UK), its

motor insurance vehicle into run-off.

It was at this time - when HSBC made the announcement that the corporate strategy was now to be focusing on pensions, investments business and life insurance and moving away from (motor) underwriting in the UK, that tongues really started to wag regarding the other insurance elements.

Various suitors have been referred to in the insurance press ever since, however for me, the fact that through this one acquisition Marsh could make a serious dent in the gap between themselves and their largest and oldest rival, super broker Aon (who of course pulled a similar trick last year when they bought Benfield) would suggest there is more than idle gossip involved here.

Based on the figures produced by IMAS corporate advisors earlier this quarter, the gap between these two giants of the broking sector is currently at £214m. HSBC Insurance Brokers are currently ranked ninth in the

and should there revenue of £146m come under Marsh control then the gap between Aon and Marsh would come down to a rather more competitive £68m. What this would mean for the rest of the UK Insurance Brokers market is a topic for another article entirely though!

So for Marsh the attraction of picking up HSBC Insurance Brokers, especially from a parent company who appear keen to exit this sector, could be a little to tempting to resist? Well add into this mix the fact that the current CEO of HSBC Insurance Brokers, Phillip Gregory is an ex Marsh man. (CEO Europe, Middle East and Africa)

So with a tailored made CEO to oil the process of transition, should the question perhaps be when rather than if this deal is going to go through?

Well I’m not one to gossip but….

Interesting analysis Kris!
We'll keep you posted here of any developments.

UK Car Insurance Rates Must Harden As Loss Making Companies Claims Reserves Run Dry!

2009-12-29T05:01:00.000-08:00

Incredibly Car Insurance companies in the UK are struggling to make a profit and 2010 is likely to see a large reduction in the supply of car insurance, with many famous brands and suppliers predicted to disappear from the high street and our television screens as the market adjusts to cater for the massive losses, according to analysts from car insurance comparison website Car-Insurance.tv.

Recently released figures show that the UK Motor Insurance market has been consistently losing money since 2004 when the total UK profit from underwriting car insurance policies was £77 million.
In 2007 the UK car insurance market made a £1.1 billion underwriting loss, last year the loss was £1.3 billion and the figures for 2009 are expected to be worse........

Very few car insurance providers have escaped the losses and are profitable, whilst many have released claims reserves held from previous profitable years to disguise the 'actual ' loss.

So what is causing such massive losses in a large compulsory market that not so long ago was the most aggressive in the world?

On the face of it the answer appears to be simple ...... The Cost of Claims!

Claims are the problem not because the Car Insurance Companies have failed to include the rising costs of claims into their pricing structures; but because they have failed to cover the true costs in the retail price!

Car Insurance underwriters seem to have forgotten the basic rules of betting when setting their prices - and that is, that the Bookie never loses.......

To understand where the car insurance underwriting companies have gone wrong you first need to examine how they arrive at the price of a car insurance policy premium.

The cost of your car insurance premium is basically made up of three components:

1. The costs of production - Staff, Systems, Distribution etc
2. The costs of losses - known claims ratios ( the proportion of a policy premium pool that gets eaten up in claims)
3. Profit

The cost of all these components can be calculated by clever people called actuaries who work for the insurance companies and the rates set accordingly.

So what's gone wrong?

Well naturally it is obvious to first look at claims as the cause of the losses - but the truth is far from this end of the life of a car insurance policy......

The frequency of claims has either fallen or remained fairly constant over the period of losses and the actual cost of claims has only risen by 1 percent.

Despite all the noise made about gangs of car insurance claims fraudsters roaming the streets of the UK, the fact of the matter is that most of this is propoganda aimed at deterring fraud which naturally rises during a recession/depression. The number of fraud cases are really insignificant in the true scale of the market to affect pricing.
Admittedly there has been a significant increase in the number of personal injury related claims, egged on by claims farming companies, which would affect long term pricing, however the losses experienced by Car Insurance companies are nothing to do with claims and claims pricing.

These type of claims fluctuations have always been dealt with successfully in the past by car insurance companies by adjusting reserve ratios or negotiating better re-insurance ( laying the risk off), or more importantly by adjusting price ........

But this time something is different....

Car Insurance Companies can no longer set the price! Not if they want to win the business anyway!
And they certainly cannot sell policies at the premium levels that the Actuaries suggest!

Why? Seemple .......The Internet!

And more importantly Car Insurance Price Comparison websites or aggregators as they are known in the industry, which account for around 90 percent of the Car Insurance sold online. Since around 2004 it has been possible to easily compare car insurance quotes online from numerous suppliers, and invariably the cheapest premium wins the business.

Car Insurance companies not longer set their own prices! And this is the problem!
In a race to achieve enough volume to make a book of car insurance business profitable the car insurance companies have been selling their car insurance polices too cheap and covering their losses with their claims reserves........time is running out!

Thatcher is Dead! At Least She had Pet Life Insurance

2009-12-07T03:24:00.000-08:00

A text message reading "Thatcher has died" has sparked a minor diplomatic incident in Canada.
The author of the message was the country's transport minister John Baird, who was announcing the death of his pet cat.
However Canada's prime minister Stephen Harper was mistakenly informed that the message referred to the the 84-year-old former British prime minister Margaret Thatcher.

According to BBC News, frantic calls were placed to 10 Downing Street and Buckingham Palace, while rumours circulated among politicians attending a black tie gala event in Toronto.

A Canadian government aide even began preparing an official statement commemorating Mrs Thatcher's passing.

Luckily the identity of the "real" Thatcher, a 16-year-old grey tabby, was quickly clarified.

Fortunately the old moggie has pet life insurance an element of Cat Insurance which will cover the costs of the state funeral.

In Memorium we were going to publish a few pictures of Thatcher's 11 year in office achievements.....so here's some treasured memories anyway!

1981 Riots in every town in the UK

1982 - The Falklands War

1984 The Miners Strike

Restructuring The Economy - The 1980's

Happy Days!

Think before you vote!

Events Insurance and the World Cup Finals

2009-12-05T04:48:00.000-08:00

Well Today InsuranceBlogger is going to break one of his golden rules and write a post that really is hardly connected to Insurance or the Economy...
And I just can't resist it......

Now being the world's top insurance blogger brings with it a certain sense of responsibility, however today all that goes out the window .....

Well unless you are of European, African, Hispanic or Asian origin ( That's you USA!) you would have failed to notice that one of greatest battles on this planet will take place next year in South Africa, and as revenge and for the first time since 1950 England will put the USA to the sword in the very first round!

Bring it on!

Sporting Event Insurance

Green Shoots in the UK Economy and Markets?

2009-12-03T05:48:00.000-08:00

There's been a lot of positive talk in the UK housing market over the last few days or so........Onward Christian Soldiers.....

Relaxation of the credit stanglehold?
Total net lending to individuals rose by £0.3 billion in October. The twelve-month growth rate fell to 0.7%, and the three-month annualised growth rate increased 0.3% to 0.5%, according to new figures from the Bank of England.

Money for New Mortgages?
The value of building society mortgage approvals in October was £1,511 million - broadly in line with the £1,565 million of approvals in September according to new figures from the Building Societies Association.
Gross lending also remained steady with £1,666 million being lent in October compared to £1,605 million in September.
Within the total, net lending secured on dwellings increased by £0.9 billion, in line with the September increase and above the previous six-month average of £0.6bn. The twelve-month growth rate was unchanged, at 0.8%. The three-month annualised growth rate increased 0.4 percentage points to 1.0%. Within total secured lending, secured lending by banks (excluding the effects of securitisations) increased by £3.1 billion, slightly below the September increase (£3.3bn) but above the six-month average of £2.6bn.
The number of loan approvals for house purchase (57,345) was above the September figure (56,205) and above the previous six-month average, whereas approvals for remortgaging (24,596) were below both the September figure and the previous six-month average.The number of loans approved for other purposes (29,195) was higher than in September and higher than the previous six-month average.

Credit Cards - Britains 'Secret' loan sharks!
Consumer credit fell by a net £0.6 billion, below the previous six month average of -£0.1bn. Credit card lending increased by £0.1 billion and other loans and advances fell by £0.7 billion. The annual growth rate of consumer credit continued to fall, to -0.1%; the three-month annualised growth rate fell to -2.2%.

Housing Market still in Cheyne-Stokes
House prices grew by 0.2% in November according to the latest national house price survey published by Hometrack, the housing intelligence business - the fourth consecutive increase in prices, bringing the year on year rate of house price growth to -2.9%.
Commenting on this month's survey, Richard Donnell, Director of Research said:
“There are three distinct elements to the latest results from this and other recent surveys. This first is that prices continue to post month on month increases. The second is the extent of prices rises across the country and the number of households who have seen an improvement in market conditions over 2009. The third, and most important element, is the short term outlook for prices.”
“This is the third consecutive month that the survey has posted a 0.2% price rise. Add to this a growth in sales volumes and it is easy to see how agents are beginning to feel more confident about sustainable pricing levels - at least in the short term. But this pick up in market activity and prices is not one that has been felt across the whole country. The stark reality is that there are large swathes of the country where prices have remained unchanged or have seen continued price falls.”
Over the last 6 months London and the South East have consistently seen the largest number of postcodes registering price rises - values are up across 78% of London and over half of the South East. Yet in five regions less than 20% of the market has registered any price rise.

Personally I see nothing in these indicators to warrant any change of course by the Bank of England regarding Interest Rates.
It is quite clear however that the money invested by the British people into the Quantitive Easing 'project' is clearly designed to line the pockets of those within the system where the money will not 'trickle down' into the general money supply.
The credit strangulation of SME's and individuals is as bad as ever!

Government Transport Policy set to increase Car Insurance Rates

2009-11-22T03:59:00.000-08:00

The British Government although to be applauded in some social areas, seems to have totally got things wrong with it's policies towards infrastructure, and those policy relationships with transportation, movement of goods and people and subsequent business development and economic growth.

Anybody who has been stuck in a gridlocked traffic jam on the M25 while trying to get to a work meeting...will know exactly what I mean.
Yeah and they don't exactly provide roadside toilets (latrines to you guys over there), and what with all the closed circuit TV cameras covering every bush....!

Now I'm not one of those who would like to see less cars on the road, in fact, like J Clarkson I'd like to see more - on a lot more, better built roads and motorways.
And I'm certainly not advocating that you vote for Cameron and his policy less party!

The man would have us all on pushbikes!

But the latest announcement of UK Government transportation policy in mid week, borders on economic and social lunacy and demonstrates that the mandarins in Whitehall have little understanding of causality and it's consequences, and it logically follows that their plans, if they actually have any, lack any inherent vision.

What am I talking about?
Why? the stupid decision to slap a minimum £22 tax on every seat on most domestic flights within the UK!
In some places like Cornwall this is in addition to an Airport development tax that all departing passengers must pay. With all the additional charges like parking or taxis the combined effect will obviously be to push traffic back onto the roads, increasing risk and ultimately Your car insurance premiums.

It's not like it's easy to travel domestically anyway, with the ridiculous security checks and the threat of fifth columnists, you can't even get a decent cup of tea or have a smoke in the modern departure lounge that mostly resembles a scene from Phillip K Dick's BladeRunner.

If you restrict the movement of people and goods you are restricting economic growth!

There are some exceptions to the ludicrous tax! if you live in the Outer Hebrides you won't have to pay the tax. This is obviously an area where the Scottish run UK Government wants to see some development!