admin, Author at Insurance Agency Singapore | Commercial Insurance and Personal Insurance

The rise and rise of unaffordable motor insurance

23 August 2016 By admin Leave a Comment

motor insurance

You know things are bad when people start moving back in with their parents because car insurance costs too much. For most of us, moving back in with mammy would be a line of last resort but it is increasingly a reality for many who have seen the cost of insuring their car for a year spike dramatically upwards.

On average, the cost of car insurance has risen by 38 per cent in the past year, and that’s on top of significant rises in 2015 and 2014. Some have seen three- or four-fold increases in the numbers at the bottom of their renewal slip. Ireland Underground, a pressure group whose aim is to lobby for reductions in the cost of insurance, has reported that at least one of its members has a position of work under threat because she cannot afford the sudden increase in premium.

According to the insurance industry, there are solid and sadly sensible reasons for all of this. To begin with, Irish drivers are being wayward and racking up more and larger claims. On top of this, the market for insurance is somewhat perilous: it has been dealing with the collapse of Setanta Insurance and must now deal with the collapse of Enterprise Insurance. And as if these factors weren’t enough, the legal system has been driving up the cost of insurance thanks to inflated fees and the new-found freedom of judges at the District Court level to hand out larger awards.

By Neil Briscoe

See full story at www.irishtimes.com

Why are insurance companies lagging in climate risk?

18 August 2016 By admin Leave a Comment

insurance

You would think that insurance companies would be experts in minimizing risk and reducing exposure to catastrophic natural disasters.

But a recent report suggests that the vast majority of insurance companies are not factoring in climate risk when it comes to their investment decisions.

Just one out of every eight insurance companies is taking tangible action on protecting their portfolios on climate risk, according to the Asset Owners Disclosure Project’s (AODP) annual Global Climate 500 Index, which analyzed 116 insurers with $15.3 trillion of investments.

The report also found that only 1 percent of those insurance companies assess the emerging risk of stranded assets, or the risk that carbon assets will become “stranded” in part due to future regulations on fossil fuels and growing demand for renewable energy.

Most of all, the report finds that insurance companies pale in comparison to how pension funds are evaluating climate risks such as climate change and drought.

Low-carbon investments represent on average only 0.8 percent of insurance portfolios, but 3.5 percent of pension portfolios as $30 billion of insurance assets are invested in low-carbon investments compared to $93 billion of pension assets.

Evaluating risk

Insurance companies generate revenue in two ways: collecting insurance premiums from customers and also investing those premiums in different investments.

The AODP says that while insurance companies are analyzing climate risk when offering insurance to their customers, the insurers are largely not assessing climate risk when it comes to their own investment portfolio.

“Pension funds in recent years have been driven by a small percentage of active members to review their management of climate risk,” said AODP CEO Julian Poulter. “This accountability does not exist for insurance companies who don’t have members, who are mainly listed and whose shareholders have been slow to hold them to account.”

The AODP ranks insurance companies on how well they are assessing these risks on with their own ranking system from AAA to D, and companies that have shown no signs of any action are referred to as laggards and are given the ranking of X.

Out of the 116 insurers analyzed by the AODP, 48 companies showed no evidence of doing anything to protect their portfolios from climate risk. This totaled $4.2 trillion assets under management.

By Keith Larsen

See full story at www.greenbiz.com

4 Things to Know About Disability Insurance

16 August 2016 By admin Leave a Comment

Disability Insurance

Insurance. There are probably no other financial terms more likely to induce feelings of sleepiness. Or dread. After all, who likes to spend money on something you hope you’ll never have to use? And don’t you have enough types of insurance already?

Well, without wanting to sound like an insurance salesperson, how would you pay your bills if an accident or illness left you unable to work? That’s the risk disability insurance is designed to cover. It would pay a portion of your salary in that situation.

The good news is you may already have adequate protection. And even if you don’t, the cost of coverage may not be as high as you feared. Here’s what you need to know about disability insurance.

1. You Might Need It

When you’re young and healthy, it’s difficult to imagine life might ever be different.

However, the insurance industry is quick to point out that your chances of becoming disabled are higher than your chances of dying prematurely. And the Social Security Administration has a scary-sounding statistic to back that up: Some 25% of 20-year-olds will become disabled before reaching retirement age.

However, not all disabilities are the same. Some are severe and permanent. About 10% of all Americans are now severely disabled, according to the U.S. Census Bureau. Many other disabilities are neither severe nor long-lasting. To put the situation in context, the Council of Disability Awareness says the average length of a long-term disability claim is three years.

2. You Might Already Have Some

Even without buying a disability insurance policy, you might already be at least partly covered.
Workers’ Compensation

This program is administered on a state-by-state basis, and some states do not require companies with fewer than four employees to maintain the coverage. However, if you work for a company that does carry workers’ “comp” and you’re injured on the job or develop a work-related disabling illness, this insurance should cover about two-thirds of your pre-disability income.

Still, the National Safety Council points out that only 27% of long-term disabilities are work-related. Most don’t even come from accidents; they come from cancer, heart disease, and other illnesses.

3. You Might Need More

After reviewing all of the above, if you decide to buy additional coverage, check whether it’s offered through your employer. That will typically be the least expensive option.

By Matt Bell

See full story at time.com

How Much Insurance is Needed in Singapore?

11 August 2016 By admin Leave a Comment

Insurance

Singaporeans are said to be kiasu (fearful of losing out) in almost everything. Looking around at the enrichment classes that a child attends these days for their development and other peripheral expenses that becomes priority makes one wonder if Singaporeans are also spending just as much on protection.

How much protection is enough?

Based on a gap study conducted by Tower Watson for LIA in 2012, a person should have an adequate insurance coverage of 10 times his or her annual income especially if one has dependants¹. Alternatively, a working adult requires an average protection needs of $626,000¹ ! This may just well be a guideline to the amount of insurance coverage required.

So what should I do?

Once you have a simple method to identify your insurance coverage, you may then start to work on your shortfall. With the shortfall, you may fill the gap by simply adding a term plan. Due to the fact that there is no cash value at the end of the coverage also explains why it is one of the cheapest life protection product out there.

Why do I need insurance?

Insurance is a very good tool for managing risks for you and your loved ones.

If you are earning $3,000 a month and need to cover yourself adequately for $500,000, based on a 20% savings each month, it will take you $500,000 / ($3,000*20%) = 833.33 months or 68.4 years just to accumulate that amount. This is where buying insurance to transfer the potential cost, in exchange for a fee known as the premium, for insurance company to take on the risk that you may face.

See full story at secure.fundsupermart.com

Singapore Insurance Market – Boom or Bubble about to Burst?

9 August 2016 By admin Leave a Comment

singapore insurance

The LIA of Singapore recently released its industry performance for 2015 with 14 per cent increase in new business and almost $3 billion in new business premium. With a bumper crop of insurers vying for a slice of this pie, what does the future hold for insurance in Singapore? Are we in a market boom or is this a bubble that is about to burst?

Rapidly changing regulatory landscape
The introduction of the Financial Advisory Industry Review (FAIR) 3 years ago sought to raise industry standards and bring about more transparency in terms of the products and sales process. While this was on the whole, welcomed in the industry – which viewed increased regulations as a step in the right direction – it also led to an exodus in sales talent, especially in the Banking segment where sales commissions were most drastically cut.

Changing business model – direct purchase
One of the key recommendations from the Monetary Authority of Singapore (MAS) was the introduction of direct purchasing for insurance products. While the majority of insurance professionals we spoke to felt that Singapore is not ready for such a model, a number of companies have expressed interest in creating a direct purchase model for the life segment to both combat rising operating costs and bypass the problem of attracting and retaining talent.

High net worth landscape – demand for specialists
The demand for specialist talent in the high net worth segment continues, especially in the sales segment, albeit at a slower pace. While employers remain open to strong specialist profiles, the increasingly uncertain market also means tighter recruitment criteria such as:

1. Stable profiles – movements within 1 – 1.5 years are usually scrutinised and some employers have been known to request for proof of job performance / track records.
2. Strong track record – this relates both in terms of sales performance but also career progression that makes sense. For instance, opportunist candidates who make the leap for a small increment in pay will find the current market challenging.

By Cherylene Wee

See full story at www.morganmckinley.com.sg

3 types of insurance policies Singaporeans should consider

12 July 2016 By admin Leave a Comment

insurance policies

If your insurance agent had his way, you’d be insured for everything from the flu to missed MRT trains. On top of that you’d be paying every leftover cent into one of those investment-linked life insurance policies.

But don’t get all sceptical and swear off insurance altogether. Because there are certain types of private insurance that are highly advisable no matter what you do in life. Here are three Singaporeans might want to consider.

Hospitalisation policy (everyone)

Despite the changes to the MediShield Life system, it’s still financially prudent for Singaporeans who can afford to to get a private medical insurance policy that gives you some coverage for your medical costs so long as you’re seriously ill enough to be warded in a hospital.

That means you can’t make claims for those MCs you take to skip work, unless you are such a good actor you actually make it to the hospital. But it does mean you are protected if you get sick enough to ring up financially-damaging medical costs.

MediShield life provides limited coverage, which means that you’re pretty much limited to B2 or C class wards and can only use public hospitals. No matter what you think about the standard of medical care at private hospitals vis a vis public, the fact of the matter is that the waits are longer at public hospitals.

Most people will be looking at getting an Integrated Shield Plan, which basically tops up your existing MediShield Life Plan by giving you a wider choices of hospitals and wards. You’ll be able to stay in A or B1 class wards, as well as private hospitals and doctors.

Another advantage is that many medical insurance plans will cover at least part of your costs should you get hospitalised overseas. So if you get into an accident on your road trip to KL and forgot to buy travel insurance, you don’t need to be evacuated back to Singapore.

By Joanne Poh

See full story at business.asiaone.com

Let the insurer beware before adding new cyber products

7 July 2016 By admin Leave a Comment

insurer

Cyber risks are potentially catastrophic and insurers should be wary about expanding the coverage they offer, a panel of experts said.

The systemic nature of cyber risk means that insurance can be only part of the solution, so organizations should apply enterprise risk management techniques to address the exposure, they said.

Currently, cyber insurance products have a limited scope and often are limited to covering named risks, such as breach response costs. However, there is demand from commercial buyers for more comprehensive coverage. But insurers should not rush to meet those demands, said Peter Hacker, a global advisory executive at Distinction Global, a unit of the Cybercrime Research Institute G.m.b.H. in Cologne, Germany.

“Before we can run, we should start walking first. We should first start investing more time to understand better the threat itself before talk about new products,” he said Wednesday during a session of the Global Insurance Forum in Singapore, which is organized by the International Insurance Society.

Technology, such as the internet of things, is developing at a rapid pace, and insurers need to better understand the risks before offering coverage, Mr. Hacker said.

“We are running the risk that we believe that we have to create new revenue streams and potentially ignore the risk that we are confronting — a risk that’s systemic and could potentially wipe out an insurer,” he said.

By Gavin Souter

See full story at www.businessinsurance.com

A suboptimal form of insurance

5 July 2016 By admin Leave a Comment

suboptimal

Insurance regulator Irda wants promoters of insurance companies to maintain their shareholding at 50% even after listing. This is acceptable as a temporary step, not for all time to come. Insurance guzzles capital. The policyholders’ premium payments lie on the books of insurers, and prudential norms call for insurance companies to increase capital as premium collections go up.

A consequence of making the promoter always own 50% of the equity is to either restrict the growth of the company or allow only very large players to remain in insurance. This is not in the public interest. Wider ownership, a culture of active shareholder democracy and sound regulation to ensure that the insurer honours its commitment to the consumer are the long-term solutions.

However, post listing, when the cycle turns and capital requirement stabilises, promoters should have the choice to exit by selling their stakes. At present, no Indian insurance company is listed. ICICI Prudential Life Insurance has announced plans to launch an initial public offering (IPO) and get listed. HDFC Life will get listed when its proposed merger with Max Financial Services takes place. The government has also proposed the listing of four wholly-owned PSU general insurance companies. In developed markets, too, few large insurers are listed, but the trend is to move away from mutual ownership and towards listing.

See full story at blogs.economictimes.indiatimes.com

How (and Why) to Buy Travel Insurance

30 June 2016 By admin Leave a Comment

travel insurance

Picking the best travel insurance to buy for your coming vacation can be a daunting task, said Stan Sandberg, the co-founder of the trip insurance comparison site TravelInsurance.com. “There are literally hundreds of plans out there, and they are all steeped in complex legal language that can be hard for even the savviest consumers to decipher,” he said.

A good travel insurance plan, he said, gives you peace of mind that the money you’re spending on your trip isn’t lost if you end up not going and costs, on average, from 4 to 10 percent per person of the total cost of the trip per person.

Here, he shares his top tips on buying a travel insurance plan.

Figure Out What You Want to Insure.

Are you looking to protect an investment in nonrefundable airfare, hotel or cruise costs? Or do you need travel medical protection? Mr. Sandberg said that many travel insurance plans bundle both types into a single plan, which may be unnecessary but definitely costs more.

Check Your Health Insurance Before Hitting the Road.

Many travelers assume that their health insurance will cover them for any medical services, Mr. Sandberg said, but that is not always the case. “Most health plans today are based around in-network-only coverage, which means that you’re not covered if you see a doctor out of network, unless it’s for emergency or urgent care,” he said.

By SHIVANI VORA

See full story at www.nytimes.com

3 ways you can lose your car insurance that have nothing to do with your driving

28 June 2016 By admin Leave a Comment

car insurance

Finding yourself stuck without auto insurance coverage is against the law (if you’re still driving) and potentially financially ruinous if you are involved in a crash. Plus, when you do find an insurance company, the gap in your coverage will almost always mean a higher premium. So avail yourself of the following scenarios and do your research. And it’s never a bad idea to do a little insurance shopping so you have a backup in mind, just in case.

1. Health issues

Several states have laws on the books stating that car insurance companies can drop customers who develop health problems that could make driving unsafe. For instance, epilepsy, a condition that causes seizures, is a medical issue for which many states permit insurers to drop customers, unless they can prove the condition won’t affect their driving. But luckily it isn’t a straight line from diagnosis to loss of insurance.

2. Making multiple claims in a short period

Even if you’re the victim of crime or experience an extreme weather event and need to make a claim, it can spell trouble for your insurance policy. It might not seem fair, but the auto insurance industry is built on calculating risk, and making too many claims is a good way to up your chances of having your policy canceled or not renewed. Richardson says that claims, just like tickets and crashes, stay on your driving record for three years. Filing more than one claim a year could cause your insurance company to drop you. So, say your vehicle is vandalized a few times, or stolen, or your vehicle is carried away by a flood, you’ll make a claim with your insurer, and rightfully so, but making too many claims (of any type) can make you too expensive of a customer to keep around.

3. Your auto insurance company shuts down in your area

This scenario is a definite case of “it’s not you, it’s me.” Businesses fail all the time, and auto insurance companies are not immune. Even subsidiaries of national brands can shutter, leaving part (or all) of your insurance portfolio up in the air. Fortunately, there are steps you can take to reduce the chance of signing on with an insurer that is more likely to fail.

By Julia
Eddington, Credit.com

See full story at www.marketwatch.com

Insurance Agency Singapore | Commercial Insurance and Personal Insurance