`Coalition to Insure Against Terrorism As Cost to Corporate Business is Taking Its Toll ‘

#AceFinanceNews- says back in November 13 2013 the Coalition to Insure Against Terrorism (CIAT) met together with a number of people to thrash out aspects of Terrorist Risk. This was a “Statement in Conjunction with House Financial Services Subcommittee Hearing on Terrorism Risk Insurance Act (TRIA)”

According to WASHINGTON, Nov. 13, 2013 /PRNewswire-USNewswire/ — The following letter is being issued on November 13, 2013, by the Coalition to Insure Against Terrorism (CIAT):

Attendees:

The Honorable Randy Neugebauer      The Honorable Michael Capuano

Chairman                            Ranking Member

Subcommittee on Housing &            Subcommittee on Housing &
Insurance                           Insurance

Committee on Financial Services     Committee on Financial Services

United States House of               United States House of
Representatives                     Representatives

Washington, DC 20515                Washington, DC 20515

Statement as Follows:

Dear Chairman Neugebauer and Ranking Member Capuano:

Thank you for convening this important hearing to further examine the Terrorism Risk Insurance Act (TRIA). CIAT is a broad coalition of commercial insurance consumers, formed immediately after 9/11 to seek a way to restore availability of commercial terrorism insurance for American businesses and the broader economy. CIAT’s diverse membership represents, among others, commercial real estate, banking, energy, construction, hotel and hospitality, entertainment, manufacturing, transportation, the major league sports, as well as public sector buyers of insurance including colleges and universities. CIAT is the true consumer voice on terrorism risk insurance, as we are comprised of the principal policyholders of commercial property and casualty lines of insurance in the United States.

CIAT strongly supports the TRIA program. For more than a decade, TRIA has made it possible for businesses to purchase the terrorism risk coverage they need at almost no cost to the taxpayer. TRIA brought stability to a marketplace that was severely paralyzed following 9/11, and it remains a critical component of ensuring economic continuity following another large-scale terrorist attack.

It is imperative that TRIA be extended beyond 2014. A recent study by Fitch Ratings concluded that it is “unlikely that substantial private market capacity would arise as a substitute” were TRIA to expire(1). Bloomberg Government’s analysis concurs, indicating “there is no reason to assume that reinsurers will re-enter the market if the TRIA program expires, and every reason to assume that the availability of coverage will fall.”(2)

We remember all too well what happens when terrorism coverage is not available: commercial borrowers lose their ability to get financing – or go into technical default on financing covenants, billions of dollars in real estate-related transactions stalled or cancelled, hundreds of thousands of jobs lost. Simply letting TRIA expire is not a realistic option.

Under TRIA, all insurance against terrorism risk is written in the private marketplace with no upfront federal liability. All losses recognized in the TRIA plan go first through the private insurance mechanism where much of the loss is retained by design. In the absence of TRIA, which ensures industry participation, the federal share of such a disaster could well be larger. TRIA replaces government exposure with private capital, since insurers retain the cost of all but the largest terror incidents.

As a coalition of primarily commercial entities, we instinctively prefer private market solutions. However, the unique characteristics of terrorism (e.g., adaptive, intentionally driven to inflict catastrophic damage, can strike anytime/anywhere, etc.), significantly hampers the reliability of traditional actuarial risk models, thus necessitating a program like TRIA. To this end, we believe one of the strengths of TRIA is the manner in which it utilizes the private insurance marketplace to manage terrorism risk – indeed, as mentioned above all exposure under TRIA starts with private insurance contracts and, due to both significant retentions and the recoupment mechanism, the ultimate risk-bearers under TRIA are the policyholders and the private insurers. We are always willing, however, to consider ways to further limit taxpayer exposure under the program,  which we know is your focus as well.

Overall, we support the current structure of TRIA and are wary of major structural changes. We are open to modifications so long as they do not have the effect of restricting the availability of terrorism insurance. The current retrospective pooling arrangement, nevertheless, has advantages over various “pre-funding” mechanisms because:

—  the retrospective pooling arrangement avoids the need to set
contribution rates based on some guess as to how much in terrorism
losses there will be
—  a pre-funded pool poses temptation to spend the funds on other purposes
—  the uncertain nature and timing of large terrorist attacks leads to the
risk that a pre-funded pool could be either insufficient or
over-capitalized

With respect to the various private sector retention levels under TRIA (i.e., the program trigger, insurer deductibles, etc.), we remain concerned that increasing these levels too much too quickly could restrict the availability of terrorism insurance. We understand, after all, that reinsurance capacity for even the existing retention levels under TRIA is limited.(3) This fact alone demonstrates that TRIA is not “crowding out” the private sector.

Lastly, reasonable measures to attract greater reinsurance and other private sector capacity to the terrorism insurance marketplace are to be encouraged. To date, however, we see no evidence that creative private sector capital alternatives such as CAT Bonds and insurance link securities are sufficiently developed to inject meaningful private capital into the terrorism insurance marketplace. Ultimately, it is important that Congress find ways to incentivize this without impairing TRIA to ensure that terrorism insurance remains available in the event that private sector capacity does not develop to the degree assumed.

We are committed to working with you as you craft a solution to extend TRIA beyond 2014, and we again thank you on your leadership on this critical issue.

Sincerely,

The Coalition to Insure Against Terrorism

American Bankers Association

American Bankers Insurance Association

ABA Securities Association

American Council of Engineering Companies

American Gaming Association

American Hotel and Lodging Association

American Land Title Association

American Public Gas Association

American Public Power Association

American Resort Development Association

American Society of Association Executives

Associated Builders and Contractors

Associated General Contractors of America

Association of American Railroads

Association of Art Museum Directors

Building Owners and Managers Association International

Boston Properties

CCMI Institute

Campbell Soup Company

Citigroup

CRE Finance Council

Cornerstone Real Estate Advisors, LLC

CSX Corporation

Emerson

Financial Services Roundtable

The Food Marketing Institute

Helicopter Associates International

Hilton Worldwide

Host Hotel & Resorts, Inc.

Institute of Real Estate Management

InterContinental Hotel Group

International Council of Shopping Centers

International Franchise Association

International Safety Equipment Association

International Speedway Corporation

Long Island Import Export Association (LIIEA)

Marriott International

Mortgage Bankers Association

National Apartment Association

National Association of Chain Drug Stores

National Association of Home Builders

NAIOP

NASCAR

National Association of Manufacturers

National Association of REALTORS

National Association of Real Estate Investment Trusts

National Association of Waterfront Employers

National Basketball Association

National Collegiate Athletic Association

National Council of Chain Restaurants

National Football League

National Hockey League

National Multi Housing Council

National Restaurant Association

National Retail Federation

National Roofing Contractors Association

National Rural Electric Cooperative Association

New England Council

Office of the Commissioner of Baseball

Public Utilities Risk Management Association

The Real Estate Board of New York

The Real Estate Roundtable

Securities Industries and Financial Market Association

Self Insurance Institute of America

Starwood Hotels and Resorts

Taxicab, Limousine & Paratransit Association

Union Pacific

University Risk Management and Insurance Association

U.S. Chamber of Commerce

U.S. Travel Association

UJA Federation of NYC

(1) Fitch Ratings U.S. Terrorism Reinsurance: Looming Uncertainty of Program Renewal, 1 (2013).

(2) Bloomberg Government, Extending Terrorism Insurance: The case is strong for maintaining a federal backstop in a market too risky for private sector alone, 5 (2013).

(3) According to Eric Smith of Swiss Re, “Based on the most recent estimate, the total amount of reinsurance capacity available for terrorism in the United States is approximately $6-10b — well below the $27.5b insurance marketplace aggregate retention under TRIA and the $34-35b cumulative insurer loss retentions.” The Terrorism Risk Insurance Act of 2002; Hearing Before the H. Comm. on Financial Services, 113th Cong. (2013) (statement of J. Eric Smith, President & CEO, Swiss Re Americas, at 4).

SOURCE  Coalition to Insure Against Terrorism (CIAT)

Coalition to Insure Against Terrorism (CIAT)

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` Affordable Care Act Can Charge Smokers 50 Percent More in Premiums But What About E-Cigarettes ‘

 

 

#AceFinanceNews – May 10 – A recent article by (GMA) has posed the question `Under the Affordable Care ActInsurance companies can charge smokers and other tobacco users up to 50 percent more than non-smokers for a health insurance policy.

But where do e-smokers fit in? 

 

Hans Rudi Erdt: Problem Cigarettes, 1912 . Adv...

Hans Rudi Erdt: Problem Cigarettes, 1912 . Advertising poster. Color Lithograph, 26,6 x 36,9 in. / 67,6 x 93,7 cm (Photo credit: Wikipedia)

E-cigarettes are battery-operated nicotine inhalers that consist of a rechargeable lithium battery, a cartridge called a cartomiser and an LED that lights up during each puff. Although they contain no tobacco, the U.S. Food and Drug Administration plans on regulating them like cigarettes and cigars. This, it turns out, is complicating things for insurance companies.

 

While the ACA allows insurance companies to charge higher premiums to smokers and other tobacco users, the definition of a “smoker” is unclear under the law.

 

One way insurance companies could deal with e-cigarettes is to lump them in with tobacco products – a move that would subject so-called vapers to the same higher premiums as cigarette smokers. The companies could also swing the other way and decide to cover the cost of e-cigarettes as a means to help people quit smoking, despite a lack of evidence that the devices work as well as a patch. Insurers could also choose to ignore e-cigs altogether.

 

”The Affordable Care Act does not specify e-cigarette use for purposes of cessation coverage or tobacco surcharge application,” the American Cancer Society said in a statement to ABC News. “The lack of clarity may allow health plans to try to add the surcharge for e-cigarettes.”

 

If and when the FDA regulation of e-cigarettes goes into effect, insurance companies could change any of their current policies to reflect the agency’s direction. In the meantime, most companies claim they have too little experience with the devices to have a position, according to an informal poll by the National Association of Health Underwriters.

 

Carrie McLean, director of customer care for the online health insurance brokerage eHealth, said some insurers are telling their agents to add a smoking surcharge for those who  vape.

 

“If a consumer indicates they use e-cigarettes, the carriers are expecting them to be uprated just as if they are a smoker,” she said, noting that consumers are not actually asked about the type of tobacco products they use during the health insurance application process – just whether they use them at all.

 

 

Ace Related News: E-cigarette Poisoning On the Rise 

 

 

GMA

 

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Everyone Needs Car Insurance but Getting the Best Deal is Becoming Harder by the Year

English: A component diagram illustrating an I...

English: A component diagram illustrating an Insurance policy administration software system (Photo credit: Wikipedia)

When you first begin driving your insurance will most likely be the highest it will be in your life-time. This is because an insurance company needs to know you’re not going to cost them too much money. When you first begin driving they have no idea what kind of driver you’ll be; courteous, law-abiding and careful or reckless, fast and inconsiderate.

The fact that you may have more accidents and this could end up costly for the Insurance company in the early days ,reflects your initial premiums.

ASSESSMENT OF RISK:  

The fact is they have no track-record to look at for them to access your driving skills and so actuaries will base their  risk in the policy and cost of premiums for a type of cover at the higher rate for your first year, that will decrease year on year providing you have no accidents or points on your licence. The other factors that their risk assessment will take into account are age, under 25 and automatically your premium will be loaded, with some form of excess. Also should you be a high mileage driver they will take this into account. Other factors affecting cost will relate to where you park your car at night, be it a garage or on the open road.  In the past gender used to play an important role, but with more and more companies rating the customer as one gender for price, due to changes by the “Equality Rights Commission” this does not play such an important part in pricing.

Knowing which factors can reduce the amount you pay can help you know how you should drive and what you can do to reduce those costs, however when it comes to renewal how do you know you’re getting the best offer for your safe driving? The renewal you’re sent through the door is almost never the best deal you could get. Even ringing them directly doesn’t mean that they can offer you the best deal for you. On-line comparison sites tend to be the best way to get value for money. You can decide on your type of cover and see offers from many insurers and choose the one you prefer.  There are many price comparison sites and they will use the rule of providing a policy on the information you type into their search machine, but remember you only get what you pay for, and exclusions apply with every policy! They are not providing  this service for nothing, and will have metered into the premium costs their commission somewhere down the line ,even though as a consumer this will not be obvious.

Vintage Ad #1,168: Sympathy from the Car Insur...

Vintage Ad #1,168: Sympathy from the Car Insurance Industry (Photo credit: jbcurio)

My Conclusion and Overview of the Market:

During the time l was selling insurance for both car and household l kept one thing in mind at all times ,this was that the most important person in everything l was doing was the customer. Nowadays we are blinded with technology, that on the face of it looks like it is assisting us with the best arrangement ,but as l have found out through research and years of experience, things are not as they seem.

The real fact that everyone should be looking at is not so much the price or the cover, but simply what are you not covered for in this well written and presented insurance policy! So look carefully at the part in the policy document that states ” What this Policy does not Cover” and should anything be in there that you thought was covered, decline to sign up.

REMEMBER: Always ask for a copy policy document before you agree to the New Policy or sign any policy agreement ,as once you have and pay the first premium, it is harder to stop the policy and get yourself a full refund. 

And: 

You never know how good a company is until you claim! 

 

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Latest Data of Complaints Handled by the Financial Ombudsman Services

Financial Ombudsman Service Adam Christian Debt Management Services – latest report on the Financial Ombudsman Service recently releases the latest six-monthly complaints data relating to individual financial businesses – including the high street banks and insurance companies.

The data published on the ombudsman‘s website details complaints handled by the ombudsman service between 1 January and 30 June 2013. This includes:

  • the number of complaints received about individual financial businesses; and
  • the percentage of complaints the ombudsman upheld in the consumer’s favour against those businesses.

During the six-month period, the ombudsman service took on a record number of 327,035 new complaints – an increase of 15% on the previous six months. Over 95% of these cases came from 195 financial businesses – out of more than 100,000 businesses the ombudsman covers.

Complaints about payment protection insurance (PPI) made up more than eight out of ten (86%) of the total complaints referred to the ombudsman during the first half of 2013 – with 266,228 new PPI complaints (compared to 211,885 in the last six months of the 2012). Five financial services groups accounted for 78% of all new PPI cases.

For complaints about financial products other than PPI, the total number of complaints referred to the ombudsman reduced by 15% from 71,366 to 60,807 during the first six months of the year. This involved a decrease of 22% in banking complaints and 3% in insurance cases.

Across all individual businesses included in the data, the uphold rate (where the ombudsman found in the consumer’s favour) ranged from 2% to 98%.

Commenting on the complaint statistics released today, Natalie Ceeney, chief executive and chief ombudsman, said:

During the first six months of this year we sorted out a record number of complaints for people – making real progress in tackling the customer-service fallout from the mis-selling of PPI, widely accepted as the largest financial mis-selling scandal.

Disappointingly we are still seeing cases where businesses are not following our long-standing approach to PPI, resulting in long waits and unnecessary delays for consumers.

But, more positively, we are seeing encouraging signs from some major businesses that are starting to recognise the value of getting things right for their customers – with an increased focus on sorting out problems and concerns as quickly as possible.

Look at the complaints data now available on individual financial businesses.

http://www.ombudsman-complaints-data.org.uk/

Adam Christian Debt Management Services – Report

Following a recent phone call to their offices in the last few days to chase-up one of the ongoing claims for PPI that was mis-sold to one of our clients, l was told by their offices that in fact they have over 500,000 ongoing cases, but they are getting through the back-log at an average of 100,000 every three months! The average wait for a claim at the present time is between 12 and 18 months, dependant on the complexity of the case!

There is simple requirements to submit your case to the Financial Ombudsman Service and these l will cover in a future post, that will highlight from beginning to end how easy it can be to claim ,without losing any money to claims companies, also how difficult it can be made to look.

This report update was just to show the latest figures, if you are one of the unlucky ones to have a case that has been referred or sent to their offices.

Regards, Ian K Draper – Guest Post

 Adam Christian Debt Management Services

The official body of people that govern the issuance of consumer credit licences and their use!

The official body of people that govern the issuance of consumer credit licences and their use!

Licensed under the Consumer Credit Act 1974            

 

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National Insurance Contributions Bill will deliver a £2,000 a year tax cut for businesses and charities.

The Bill contains legislation for the Employment Allowance which, from April 2014, will give businesses and charities a £2,000 tax cut off their National Insurance Contributions bill.

Infographic on the National Insurance Contributions employment allowance.

Benefiting up to 1.25 million businesses, this action taken by the government will result in around 450,000 businesses – or one-third of all employers – being taken out of paying National Insurance Contributions altogether.

See how the Employment Allowance will reduce National Insurance bills for businesses and charities from April 2014:Employment Allowance Calculator

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