October 2014

Talk Around the Bazaar

While sanctions are starting to bite in Russia, it is welcome news that some organisations are aligning their strategies with the Western world. The Russian Risk Management Society, RusRisk (http://rrms.ru/en/), has been integrating professionals and experts representing large and medium-sized industrial companies, banks and other credit and financial organisations, and insurance, brokers and consulting companies successfully and one of their members was recently elected to the board of Ferma. To read more on Ferma’s recognition of these feats, please go to http://www.ferma.eu/blog/2014/09/gaining-recognition-risk-management-russia/

Implementation of Solvency II is set for January 2016. We are now seeing some large carriers such as Allianz and Prudential presenting estimated metrics to investors. To refresh our memories, Solvency II is an EU legislative programme to be implemented in all 28 Member States. It introduces a new, harmonised EU-wide insurance regulatory regime. The legislation replaces 13 existing EU insurance directives. For those readers who are unsure what Solvency II is all about in more detail, the Bank of England has the answers at http://www.bankofengland.co.uk/pra/pages/solvency2/default.aspx

Early in September, the Lloyd’s market had its ‘A’ financial strength rating and ‘A+’ issuer credit rating affirmed by AM Best; for the first six months of this year, the market turned in a profit of £1.67 billion – 21% higher than a year ago; the Chinese government awarded Lloyd’s a licence to establish a branch office in Beijing. It looks good for Lloyd’s and to learn what the chairman thinks, you can read the text of his speech at the City Dinner at http://www.lloyds.com/lloyds/press-centre/speeches/2014/john-nelsons-speech-at-lloyds-city-dinner-2014

The Gibraltar Insurance Association has been in the news recently with mention of the ILS Guidelines and Solvency II capital requirements. For a good picture of The Rock as an insurance domicile, please read http://www.gia.gi/captive/

US captive insurers rated by AM Best have continued to outperform the commercial sector in every key financial measure, according to the rating agency’s latest report on the captive insurance sector. Captive International has a good article at http://www.captiveinternational.com/news/us-captives-continue-to-outperform-commercial-insurers-871?utm_source=Insurance&utm_campaign=1e5d359f18-Captive_Weekly_News_15_09_2014&utm_medium=email&utm_term=0_f246694353-1e5d359f18-27166897

For the vast majority of us, insurance is a sleep easy formula, reassuring us that if an untoward event occurs, we will be identified. Our friends at iNavigator have put together some colourful images of what some of those untoward events look like. These can be seen at http://www.inavigator.com.au/members/DocMng/st_Main.asp?ProjID=124&page=7493

Amid all of the negative news of developments in Ukraine, it is encouraging that insurers still see opportunities in the country. Ukrainian insurer JSC Nova has launched a new obligatory reinsurance programme for property, engineering and transportation risks with French reinsurer Scor SE acting as a partner for the programme. For more on this subject, please go to Nova’s website at

http://www.nova-ua.com/en/news/NOVA_Ins_Co_concluded_a_contract_of_obligatory_reinsurance_of_property_risks_and_cargo

The International Union of Marine Insurance (http://www.iumi.com/) has just celebrated its 140th anniversary at a gathering in Hong Kong. The IUMI has quite a few affiliates such as the CMI (Comité Maritime International, http://www.comitemaritime.org/Home/0,271,1132,00.html), Intercargo (International Association of Dry Cargo Shipowners, http://www.intercargo.org/) and the IGP&I (International Group of P&I Clubs, http://www.igpandi.org/). For many people the workings of this illustrious P&I group is a mystery and so they have very kindly set out the secrets of its network of eyes and ears in the following document: http://www.igpandi.org/downloadables/news/news/Guidelines%20for%20Correspondents%202014.pdf

How many people know what Nepal 2068/69 means? It is 2012/2013 in the Nepalese calendar. This is useful to know when looking at the results of insurance companies on the website of the Beema Samiti, the Insurance Regulatory Authority of Nepal at http://www.bsib.org.np/index.php?option=download&id=152 As is the case the world over, insurance is changing and adjusting to its commercial and social environment and Nepal is no different. And so, what is the insurance environment in Nepal? We have a report from 2012 and are told that an update is due soon. That date, however, has not been specified and we thought our readers would be interested to see what has been said up until now. The Scenario of the Nepalese Insurance Industry can be viewed at http://www.bsib.org.np/images/download/9245_Esisting%20Insurance%20Sceinario.pdf

Many of the conflicts raging or simmering around the world are related to the ownership and control of natural resources such as oil. The energy insurance market is massive but it remains a very specialist sector, with brokers, consultants and carriers. One such carrier is OIL, Oil Insurance Ltd, in Bermuda, a mutual insurance company which insures over two trillion dollars of global assets. The company was formed in 1972 and critics doubted whether it would survive for long. Well, it has. But how does OIL work? A report came out a couple of months ago answering just that question and it can be accessed at https://www.oil.bm/images/stories/News-Articles/A%20Guide%20to%20OIL%20-%202014%20Brochure.pdf

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

  • “It is better to wear out than rust out” – George Whitefield
  • “One man in his time plays many parts” – Shakespeare, “As You Like It”