All articles by LII editorial
LII editorial
Starting on the long road to recovery
A rebound in global equity and credit markets came to embattled US insurer The Hartford Financial Services Groups (HFSG) aid in the second quarter of 2009, enabling it to come within striking distance of breakeven and beating analysts forecasts by a solid margin.Recovering from a $1.2 billion loss in the first quarter of the year and a cumulative net loss of $4.65 billion over the last three quarters, HFSG reported a net loss of $15 million in the second quarter
Buyout market activity takes a big hit
After almost trebling in size to £8.2 billion ($14 billion) in 2008 the UKs defined benefit (DB) pension scheme buy-out and buy-in market experienced a significant setback in the first half of 2009, reveals data compiled by pension and risk management consultancies Aon and Hymans Robertson.A sharp decline in activity became evident in the first quarter of 2009 with the value of deals completed sliding by 41 percent, from £1.5 billion in the first quarter of 2008 based on data from Aon to £890 million based on data from Hymans Robertson.The deteriorating trend accelerated in the second quarter of 2009 with the value of deals declining by an even sharper 78 percent from £2.7 billion to £604 million
Vienna Insurance gains further ground in CEE
Already a major player in Central and Eastern Europe (CEE), Vienna Insurance Group (VIG) consolidated its position further in the region by shifting into overall top position in Slovakias general and life insurance sectors in the first quarter of 2009, from second position in 2008 This advance came on the back of gross written premium income of 186.23 million ($260 million) which gave the Austrian insurer an overall market share of 33.3 percent
Regulators setting the stage for the next crisis, warn economists
Amid a scramble to introduce tougher, far-reaching regulation of the financial services industry, a group of 14 prominent economists warn of likely disastrous consequences of building new regulatory initiatives on the false premise that the financial crisis was caused by failure of the market system.
Change ahead for Intesa Sanpaolo
Italys largest bank, Intesa Sanpaolo, formed in January 2007 out of the merger of Banca Intesa and Sanpaolo IMI, has set in motion a process aimed at major rationalisation of its bancassurance operations The first is Intesa Vita, a 50:50 JV with Italian insurer Generali serving former Banca Intesa branches
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State regulators survive reform tsunami
Proposals put forward by the US Treasury that would see state regulation of insurers remain and the creation of an Office of National Insurance have received a positive reception from insurance industry players Setting out President Obamas administrations proposals for sweeping reform of the US financial regulatory structure, an 85-page White Paper prepared by the Treasury Department has received a generally positive reception by insurance industry players
Health insurance insider reveals all
Testifying before a Senate committee, a former senior health insurance industry executive has exposed a series of dubious practices used by insurers to boost profits His testimony comes at a bad time for a health insurance industry facing regulatory change that threatens to drastically shrink its customer base. Regulatory reform is a major focus of attention in the US, with health insurance reform arguably the most hotly debated of all
Irish insurers go from feast to famine
For many years, Ireland was the shining star in the European Union in terms of economic growth and one of worlds fastest-growing life insurance markets The global financial crisis brought this enviable situation to an abrupt end with dire consequences for life insurers being predicted by key industry players. The Republic of Irelands success in transforming itself from an economic backwater into the fastest growing economy in the European Union made it for many years the envy of other countries.
UK mortality model plays catch-up
A new mortality model has been launched by UK actuarial body, The Actuarial Profession (TAP), to address significant life expectancy increases since it last published projections in 2002 Gordon Sharp, chairman of TAPs continuous mortality investigation bureau (CMI), explained that the body became concerned last year by continued widespread use of a single set of projections
Fixed annuities take centre stage in risk-averse US market
American investors are not ready to flee the investment market entirely, if sales of fixed annuities are any indication.Total first-quarter 2009 sales of fixed annuities in the US, including equity-indexed annuities, jumped 78 percent from the same period a year ago, to an estimated $34.9 billion, according to consultancy Beacon Research.The results mark the fourth consecutive quarter of growth in fixed annuities sales, said Jeremy Alexander, president and chief executive officer of Beacon.MetLife retained its number-one spot in fixed annuity sales, with sales of $3.6 billion, according to Beacon, followed by New York Life, with sales of nearly $3.5 billion Rounding out the top five was AegonTransamerica, with sales of $2 billion.Broken down by product type, estimated sales of book value fixed annuities were $19.2 billion; $7.1 billion for equity-indexed; $6.5 billion for market-value adjusted and $2.1 billion for immediate, reflecting year-over-year increases for all product types, Beacon said.Further evidence of the power of fixed annuities can be found in financial services association Limra Internationals US individual annuities first-quarter 2009 sales report, which showed that fixed annuities outsold stock-market linked variable annuities $35.6 billion to $30.7 billion.Fixed annuities last outsold variable annuities in 1995, said Joe Montminy, research director for Limras annuity research, in a statement.Consumers, still leery of the volatile stock market and looking for secure, competitive guaranteed rates of return, continued to invest more money into fixed annuities for their retirement income needs, Montminy said.Having poured resources into the variable annuity side for years, US insurers now are dealing with the reality of an equity bear market and investors drawn toward more conservative, more traditional annuities