June 2013

Talk Around the Bazaar

Now in its second year, Global M&A Valuation Outlook 2013 draws on in-depth analysis of American Appraisal’s own data from deals in 2012, compiled from its 27-country network of operations, combined with industry data on international corporate deal-flow. This wide-reaching report has just been released and can be viewed at http://www.american-appraisal.com/US/Library/News/Global-MandA-Valuation-Outlook-2013.htm

Probably not as a result of last month’s Spotlight article, although the timing was coincidental, there are reports that a Dutch Flood Insurance Pool could be ratified within the next fortnight. Whilst such a development would mark a milestone in the market’s drive for flood insurance, one should not hold one’s breath. The article by Intelligent Insurer looks promising, as readers can see at http://www.intelligentinsurer.com/news/dutch-flood-pool-could-be-ratified-in-june?utm_source=Insurance&utm_campaign=92764116a7-Intelligent_Insurer_Weekly_01_05_2013&utm_medium=email&utm_term=0_f246694353-92764116a7-27166897

With the northern hemisphere summer around the corner, talk of pools, either for swimming or insurance does not ring with certainty. Another pool surrounded by doubt is the energy insurance pool proposed by the Indian government. In this case, it is not the risk which is the problem but sufficient funding. The Economic Times has the full story at http://articles.economictimes.indiatimes.com/2013-05-01/news/38958274_1_energy-insurance-pool-oil-companies-health-insurance-segment

Talking about the hemispheres, we could not resist drawing our readers’ attention to the Autumn 2013 edition of the Australian Reinsurance Pool Corporation (yes, another pool!) newsletter. The ARPC was established in response to the withdrawal of terrorism insurance cover by insurance companies following terrorist attacks around the world and particularly as a result of the events of September 11, 2001 in the United States. The ARPC is a statutory corporation established under the Terrorism Insurance Act 2003 to offer reinsurance for terrorism risk in Australia. Under the Cover gives a glimpse into what goes on in ARPC on a daily basis at http://arpc.gov.au/files/2013/04/No_2_2013_Autumn1.pdf

With a population of more than 740,000, Bhutan’s insurance penetration as a percentage of gross domestic product is less than 1% and that is pretty low. Nevertheless, India’s largest insurance corporation is to set up a joint venture partnership in the country. Advisen reports on this at http://eurfpn.advisen.com/fpnHomepagep.shtml?resource_id=1990702111753124198&userEmail=george.worsley@worldwiderisksolutions.com#top

That same Indian insurance giant, GIC Re, is planning to enter the Lloyd’s market by acquiring a syndicate. Global Reinsurance has as report at http://www.globalreinsurance.com/gic-re-eyes-lloyds-acquisition/1402719.article

In 2010 Oman planned to have a total of 20 seismic stations monitoring seismic activity in the Sultanate and its surroundings, and also supporting the Tsunami Early Warning System which was then under development at the Meteorology Department. Spurred on by recent earthquakes in Iran and Pakistan, completion of another 20 additional monitoring stations is being drawn forward. A report on this programme can be accessed at the Times of Oman’s website at http://www.timesofoman.com/News/Article-14721.aspx

On the 15th May the new European Response Centre was opened in Brussels. It is aimed at providing a faster and more efficient reaction to disasters and will coordinate operations between member states as well as the work of search and rescue teams. It will also send experts to disaster areas, provide early warning and make it easier to provide assistance to those in need following major disasters. The centre is operated jointly by all 27 member states, as well as Croatia, Macedonia, Iceland, Liechtenstein and Norway. To read the speech by the President of the European Commission at the opening ceremony, please go to http://europa.eu/rapid/press-release_SPEECH-13-412_en.htm?locale=en

Also on the 15th May, the United Nations released a report saying that private sector investments could play a role in disaster risk reduction worldwide. Advisen commented on this at http://eurfpn.advisen.com/fpnHomepagep.shtml?resource_id=1995247851541007802&userEmail=george.worsley@worldwiderisksolutions.com#top and the UN announced more detail several days later at http://www.un.org/News/Press/docs/2013/iha1310.doc.htm

China has altered the rules on market entry for intermediaries by increasing the initial registered capital to about US$8 million. AM Best and Advisen report on this move to sort the men from the boys at http://eurfpn.advisen.com/fpnHomepagep.shtml?resource_id=199938008766534546&userEmail=george.worsley@worldwiderisksolutions.com#top

Ace is to become the second foreign insurance company to open a representative office in Myanmar. The announcement comes just days after the country released plans to provide licences to twelve carriers within weeks. Insurance Insight has the news at http://www.insuranceinsight.com/insurance-insight/news/2270686/ace-to-open-office-in-myanmar?WT.tsrc=Email&WT.mc_id=1138&utm_source=Newsletters&utm_medium=Email&utm_campaign=Insurance_Insight_daily

For readers who wish to learn more about Myanmar, McKinsey & Company will gladly help at http://www.mckinsey.com/insights/asia-pacific/myanmars_moment?cid=other-eml-alt-mgi-mgi-oth-1305

Eight Asian countries cooperating under the name of South Asian Association for Regional Cooperation (SAARC, http://www.saarc-sec.org/) has just held its first regulators’ conference – in Bangladesh. Themes of the meeting were the improvement of underwriting skills and insurance penetration. Insurance and reinsurance demand is on the increase and markets need to adjust to globalisation and liberalisation. BestWire Services has the full story at http://eurfpn.advisen.com/fpnHomepagep.shtml?resource_id=2001706142123842242&userEmail=george.worsley@worldwiderisksolutions.com#top

Famous quotations. Here are some words of wisdom which have survived the passage of time…

· “The thing which impresses me most about North America is the way parents obey their children” – Edward, Duke of Windsor

· “It is a hard matter, my fellow citizens, to argue with the belly, since it has no ears” – Plutarch