April 23 (Bloomberg) -- Hartford Financial Services Group Inc. is seeking bids from rivals including Travelers Cos. for its flagship property insurance business, said people familiar with the matter, in a sign that damage from the financial crisis may lead to a wholesale breakup of the 199-year-old insurer.
Hartford, pummeled by credit downgrades after losses in its life division, solicited offers for the profitable property and casualty unit in recent weeks, said the people, who declined to be identified because the talks are private. Travelers and Ace Ltd. may show interest, the people said, and Allianz SE already has a $2.5 billion stake in Hartford. Citigroup Inc. estimates the unit is worth $4 billion to $8 billion.
Chief Executive Officer Ramani Ayer, 61, is weighing more drastic options after Munich-based Allianz’s October cash infusion failed to stave off rating downgrades. The firm had a market capitalization of about $3.1 billion on the New York Stock Exchange yesterday, implying a negative value for the money-losing life insurance and retirement operations.
Talks earlier this year to sell parts of the life operations to Canada’s Sun Life Financial Inc. ended without a deal, the people said. Hartford, based in the Connecticut city of the same name, continues to seek other buyers for the parts of its life division that sell group benefits, the people said.
Shannon Lapierre, a Hartford spokeswoman, declined to comment, as did Shane Boyd of New York-based Travelers, Sabia Schwarzer of Allianz and Stephen Wasdick of Zurich-based Ace. Allianz’s investment in Hartford is “purely financial,” Schwarzer said.
Hartford dropped 3 cents to $9.65 at 1:19 p.m. in New York. The shares had lost 85 percent in the past 12 months through yesterday. Travelers fell 28 cents to $39.65.
TARP Aid
Efforts to find buyers for the Hartford businesses may prove unnecessary if the U.S. Treasury provides enough support. Ayer has said his firm stands to get as much as $3.4 billion under the Troubled Asset Relief Program. The Treasury has used the program to shore up banks and has yet to extend it to insurers other than American International Group Inc.
Ayer, who ran the property division before assuming Hartford’s top post in 1997, has been pressured by investors and analysts to consider a breakup. The property business had $6 billion of statutory surplus and $36.7 billion of assets as of Dec. 31. Joshua Shanker, a Citigroup analyst, said in February that a sale of the property unit would bolster capital.
A combination of the division with Travelers would create the second-largest U.S. property and casualty company behind State Farm Mutual Automobile Insurance Co., according to data from the National Association of Insurance Commissioners. Travelers was 6th in 2008 by policies sold. Hartford was 10th.
Job Losses
Merging the businesses could portend job losses in Connecticut’s capital city. Hartford Financial was formed there in 1810 and more than a third of its 31,000 employees are based in the state, the company said last year. Travelers began there in 1864 and has about 7,000 employees in the city, the Hartford Courant reported today.
Jay Fishman, the Travelers CEO, is a protégé of Sandy Weill, the Wall Street dealmaker who combined Travelers with Citicorp in 1998 to create Citigroup Inc. before spinning off the Travelers property and casualty business as an independent company. Fishman left Citigroup in 2001 to run St. Paul Cos., where he engineered the $17.9 billion acquisition of Travelers in 2004.
Ace, founded in Bermuda in 1985, is run by Evan Greenberg, the son of former AIG CEO Maurice ‘Hank’ Greenberg. He bought the Combined Insurance business from Aon Corp. in 2008 for $2.4 billion, his biggest purchase as CEO.
To contact the reporter on this story: Zachary R. Mider in New York at zmider1@bloomberg.net
Thursday, April 23, 2009
Going Green Brings Insurance Discounts
Your insurance company may give you a break if you go green.
After years of inertia, the $16 trillion industry has begun to address climate change with mandatory risk disclosures and more products to help businesses and individuals reduce energy use. Insurers have begun to offer lower premiums on car, homeowner and property insurance for people who drive less, own hybrid cars or build green homes.
"Climate change represents an opportunity for insurance companies to reduce risk and to build revenue," said Andrew Logan, director of insurance programs for Ceres, a coalition of investors, environmental groups and other organizations.
After a slow start - particularly in the U.S. - insurance companies are tackling the issue. In March, insurance regulators adopted mandatory climate-risk disclosure standards for insurance companies with annual premiums of $500 million or more. These standards require the firms to report to regulators and investors the types of payout risks they may face due to climate change.
"We are concerned about how climate change will impact the financial health of the insurance sector and the availability and affordability of insurance for consumers. This disclosure standard will give regulators the information we need to better understand these risks," said Joel Ario, Pennsylvania Insurance commissioner and chairman of the National Association of Insurance Commissioners' Climate Change and Global Warming task force.
In the last year, there has also been a large uptick in insurance products offered to climate-friendly consumers, according a report Ceres released in April. The number of new products doubled in 2008. They include coverage for wind and solar production shortfalls, premium discounts for energy efficient buildings and discounts for hybrid vehicle ownership and reduced driving. Early estimates show people with pay-as-you-drive, or PAYD, policies, drive 5% to 15% less than average drivers. Fewer cars on the road mean lower accident rates and reduced fuel emissions.
"What insurers are finding out is that there is a strong correlation between reduced driving and risk," said Logan.
Opting to drive less can reduce premiums by more than 50%, said Wayne Bontrager, senior vice president at GMAC Insurance, a unit of GMAC Financial Services. Two dozen companies offer PAYD insurance products, Ceres estimates, including GMAC, Corp. and Corp.
Insurers believe drivers of hybrid or fuel-efficient vehicles can be more responsible, lower-risk customers, said Bontrager. Among companies offering a 5% to 10% discount on premiums for hybrid drivers are Cos. and Farmers Insurance, which is owned by AG.
Almost two dozen insurers offer premium credits and discounts for owners of "green" commercial and residential buildings, according to Ceres. In the U.S., that typically means buildings with Leadership in Energy and Environmental Design (LEED) or Energy Star certifications.
Green buildings are more resilient, Logan says. The idea is that green buildings are safer than conventional homes, reduce energy use and perform better in the long run, leading to a decrease in losses and greenhouse gas emissions. For instance, air conditioners and furnaces that don't run often are less likely to have mechanical breakdowns, said Janet Ruiz, a spokeswoman for the Fireman's Fund, which offers a 10% discount on yearly premiums for owners of LEED-certified homes. Fireman's Fund is a unit of SE.
Farmer's and Fireman's are also among companies offering eco-friendly homeowners insurance coverage following a total or partial loss. For an additional premium starting around $20 to $25 a year, policy holders can rebuild, say, a kitchen damaged by fire with upgraded Energy-Star appliances, lighting, electronic equipment and roofing.
Write to Jilian Mincer at jilian.mincer@dowjones.com and Shelly Banjo at shelly.banjo@wsj.com
After years of inertia, the $16 trillion industry has begun to address climate change with mandatory risk disclosures and more products to help businesses and individuals reduce energy use. Insurers have begun to offer lower premiums on car, homeowner and property insurance for people who drive less, own hybrid cars or build green homes.
"Climate change represents an opportunity for insurance companies to reduce risk and to build revenue," said Andrew Logan, director of insurance programs for Ceres, a coalition of investors, environmental groups and other organizations.
After a slow start - particularly in the U.S. - insurance companies are tackling the issue. In March, insurance regulators adopted mandatory climate-risk disclosure standards for insurance companies with annual premiums of $500 million or more. These standards require the firms to report to regulators and investors the types of payout risks they may face due to climate change.
"We are concerned about how climate change will impact the financial health of the insurance sector and the availability and affordability of insurance for consumers. This disclosure standard will give regulators the information we need to better understand these risks," said Joel Ario, Pennsylvania Insurance commissioner and chairman of the National Association of Insurance Commissioners' Climate Change and Global Warming task force.
In the last year, there has also been a large uptick in insurance products offered to climate-friendly consumers, according a report Ceres released in April. The number of new products doubled in 2008. They include coverage for wind and solar production shortfalls, premium discounts for energy efficient buildings and discounts for hybrid vehicle ownership and reduced driving. Early estimates show people with pay-as-you-drive, or PAYD, policies, drive 5% to 15% less than average drivers. Fewer cars on the road mean lower accident rates and reduced fuel emissions.
"What insurers are finding out is that there is a strong correlation between reduced driving and risk," said Logan.
Opting to drive less can reduce premiums by more than 50%, said Wayne Bontrager, senior vice president at GMAC Insurance, a unit of GMAC Financial Services. Two dozen companies offer PAYD insurance products, Ceres estimates, including GMAC, Corp. and Corp.
Insurers believe drivers of hybrid or fuel-efficient vehicles can be more responsible, lower-risk customers, said Bontrager. Among companies offering a 5% to 10% discount on premiums for hybrid drivers are Cos. and Farmers Insurance, which is owned by AG.
Almost two dozen insurers offer premium credits and discounts for owners of "green" commercial and residential buildings, according to Ceres. In the U.S., that typically means buildings with Leadership in Energy and Environmental Design (LEED) or Energy Star certifications.
Green buildings are more resilient, Logan says. The idea is that green buildings are safer than conventional homes, reduce energy use and perform better in the long run, leading to a decrease in losses and greenhouse gas emissions. For instance, air conditioners and furnaces that don't run often are less likely to have mechanical breakdowns, said Janet Ruiz, a spokeswoman for the Fireman's Fund, which offers a 10% discount on yearly premiums for owners of LEED-certified homes. Fireman's Fund is a unit of SE.
Farmer's and Fireman's are also among companies offering eco-friendly homeowners insurance coverage following a total or partial loss. For an additional premium starting around $20 to $25 a year, policy holders can rebuild, say, a kitchen damaged by fire with upgraded Energy-Star appliances, lighting, electronic equipment and roofing.
Write to Jilian Mincer at jilian.mincer@dowjones.com and Shelly Banjo at shelly.banjo@wsj.com
Wednesday, April 15, 2009
Shippers face higher insurance as pirates run amok
LONDON – Shipping your oil across the Gulf of Aden? Don't forget your piracy insurance.
As a ragtag group of gunmen face off against the U.S. Navy near the coast of Somalia, industry-watchers say shipping companies already smarting from the global downturn are forced to pony up extra cash for steeper premiums to cover multimillion dollar ransoms or take the long way around African continent in the hope of dodging hijackers.
"The pirates were the only people who had a good year in 2008," said Crispian Cuss, a security consultant with the Dubai-based Olive Group.
The Gulf of Aden, which connects the Indian Ocean to the Red Sea and the Suez Canal, is one of the busiest and most dangerous waterways in the world. As pirates have become more aggressive, the cost of insuring ships has gone up. Some companies are spending more time training their crews, others are avoiding the area altogether — taking long trips around the Africa's southern tip that can potentially add millions to the cost of each journey.
While the coast of Somalia has been a problem for years, it was flagged in May as an area of particular concern by Lloyd's Market Association, and premiums have been rising — at least tenfold, according to some media reports. Neil Smith, the senior manager for underwriting for Lloyd's Market Association, has said the exact figures are commercially sensitive in a highly competitive industry.
Large ships generally carry three separate types of insurance. Marine — or hull — insurance covers physical risks, such as grounding or damage from heavy seas. A second type of policy, protection and indemnity, covers crew issues, while war risk insurance covers acts of war, insurgency, and terrorism.
Although war risk policies typically cover hijackings and piracy, insurers often charge extra for ships that venture into high risk areas such as the Gulf of Aden. Others, including Chicago-based Aon Corp. and London's International Security Solutions Ltd., have recently launched new plans specifically tailored to cover losses incurred by piracy — for example by including ransoms and cargo delays under the same policy.
The other option available to ship operators, taking the long way around Africa's Cape of Good Hope instead of the short cut through the Suez Canal, is also expensive.
Routing a tanker from Saudi Arabia to the United States through the Cape of Good Hope, for example, would add 2,700 miles to the voyage and boost annual fuel costs by about $3.5 million, according to the U.S. Department of Transportation's Maritime Administration. In addition, it said using that route would mean the ship could make only five round trips a year instead of six, cutting delivery capacity by 26 percent.
European economies stand to absorb most of any extra expense. The Maritime Administration says more than 80 percent of trade moving through the gulf is with Europe.
While some shipping companies, such the world's largest, Maersk, have decided to take their oil tankers around the Cape of Good Hope, others have been reluctant to shoulder the extra expense, according to Graeme-Gibbon Brooks, the managing director of Dryad Maritime Intelligence Service, based in the English port city of Southampton.
"We have had a couple of phone calls from people saying: 'It might well be safer to go around the Cape of Good Hope, but our competitors are not doing it,'" Brooks said. "The problem with any diversion, be it through the south of the cape or elsewhere, is that it's going to have a commercial impact which will ultimately be borne by the consumer."
But one analyst said the global downturn may be making the southern route more attractive.
"Because there are so many vessels plying the seas right now, it makes sense to take the leisurely way around Africa. ... You're removing capacity from the industry and helping to put upward pressure on freight rates," said Jim Wilson, the Middle East correspondent for Fairplay International Shipping Weekly magazine.
As a result, demand for fuel on the West coast of Africa has surged as more ships coming from the east need to refuel after circling the cape, he said. At the same time, Egypt's revenues from Suez traffic are down sharply from last year.
The pirate attacks have begun to spook some mariners. Noel Choong, head of the International Maritime Bureau's piracy reporting center in Malaysia, noted that the crew of one ship recently refused to travel from Mombasa, Kenya, to South Africa for fear of being attacked.
Still, as security consultant David Johnson noted, taking the long way around to avoid the Somali coast doesn't guarantee safety from pirates. The Saudi supertanker Sirius Star was captured by pirates six months ago while deep in the Indian Ocean, far from the pirates' traditional hunting ground.
"Whichever way you go you're going to run into pirate hotspots somewhere down the line," said Johnson, the director of U.K.-based EOS Risk Management.
Insurance companies have also taken note of the pirates' increased range:
"Until recently, insurers regarded vessels as being relatively safe if they kept a reasonable distance from the Somali coast," said Smith, the manager at Lloyd's Market Association. Writing in the February-March issue of Cargo Security International, he said the situation had now changed.
The latest pirate attacks come at a particularly challenging time for the shipping industry.
Dubai-based DP World, one of the world's biggest port operators, warned last month that a falloff in global trade that began late last year "shows little sign of easing" because of the global recession.
Drewry Shipping Consultants Ltd. recently predicted cargo container shipments globally will drop 4.5 percent this year following decades of constant growth.
___
Associated Press Writers Adam Schreck in Manama, Bahrain, and Sean Yoong in Kuala Lumpur, Malaysia, contributed to this report.
As a ragtag group of gunmen face off against the U.S. Navy near the coast of Somalia, industry-watchers say shipping companies already smarting from the global downturn are forced to pony up extra cash for steeper premiums to cover multimillion dollar ransoms or take the long way around African continent in the hope of dodging hijackers.
"The pirates were the only people who had a good year in 2008," said Crispian Cuss, a security consultant with the Dubai-based Olive Group.
The Gulf of Aden, which connects the Indian Ocean to the Red Sea and the Suez Canal, is one of the busiest and most dangerous waterways in the world. As pirates have become more aggressive, the cost of insuring ships has gone up. Some companies are spending more time training their crews, others are avoiding the area altogether — taking long trips around the Africa's southern tip that can potentially add millions to the cost of each journey.
While the coast of Somalia has been a problem for years, it was flagged in May as an area of particular concern by Lloyd's Market Association, and premiums have been rising — at least tenfold, according to some media reports. Neil Smith, the senior manager for underwriting for Lloyd's Market Association, has said the exact figures are commercially sensitive in a highly competitive industry.
Large ships generally carry three separate types of insurance. Marine — or hull — insurance covers physical risks, such as grounding or damage from heavy seas. A second type of policy, protection and indemnity, covers crew issues, while war risk insurance covers acts of war, insurgency, and terrorism.
Although war risk policies typically cover hijackings and piracy, insurers often charge extra for ships that venture into high risk areas such as the Gulf of Aden. Others, including Chicago-based Aon Corp. and London's International Security Solutions Ltd., have recently launched new plans specifically tailored to cover losses incurred by piracy — for example by including ransoms and cargo delays under the same policy.
The other option available to ship operators, taking the long way around Africa's Cape of Good Hope instead of the short cut through the Suez Canal, is also expensive.
Routing a tanker from Saudi Arabia to the United States through the Cape of Good Hope, for example, would add 2,700 miles to the voyage and boost annual fuel costs by about $3.5 million, according to the U.S. Department of Transportation's Maritime Administration. In addition, it said using that route would mean the ship could make only five round trips a year instead of six, cutting delivery capacity by 26 percent.
European economies stand to absorb most of any extra expense. The Maritime Administration says more than 80 percent of trade moving through the gulf is with Europe.
While some shipping companies, such the world's largest, Maersk, have decided to take their oil tankers around the Cape of Good Hope, others have been reluctant to shoulder the extra expense, according to Graeme-Gibbon Brooks, the managing director of Dryad Maritime Intelligence Service, based in the English port city of Southampton.
"We have had a couple of phone calls from people saying: 'It might well be safer to go around the Cape of Good Hope, but our competitors are not doing it,'" Brooks said. "The problem with any diversion, be it through the south of the cape or elsewhere, is that it's going to have a commercial impact which will ultimately be borne by the consumer."
But one analyst said the global downturn may be making the southern route more attractive.
"Because there are so many vessels plying the seas right now, it makes sense to take the leisurely way around Africa. ... You're removing capacity from the industry and helping to put upward pressure on freight rates," said Jim Wilson, the Middle East correspondent for Fairplay International Shipping Weekly magazine.
As a result, demand for fuel on the West coast of Africa has surged as more ships coming from the east need to refuel after circling the cape, he said. At the same time, Egypt's revenues from Suez traffic are down sharply from last year.
The pirate attacks have begun to spook some mariners. Noel Choong, head of the International Maritime Bureau's piracy reporting center in Malaysia, noted that the crew of one ship recently refused to travel from Mombasa, Kenya, to South Africa for fear of being attacked.
Still, as security consultant David Johnson noted, taking the long way around to avoid the Somali coast doesn't guarantee safety from pirates. The Saudi supertanker Sirius Star was captured by pirates six months ago while deep in the Indian Ocean, far from the pirates' traditional hunting ground.
"Whichever way you go you're going to run into pirate hotspots somewhere down the line," said Johnson, the director of U.K.-based EOS Risk Management.
Insurance companies have also taken note of the pirates' increased range:
"Until recently, insurers regarded vessels as being relatively safe if they kept a reasonable distance from the Somali coast," said Smith, the manager at Lloyd's Market Association. Writing in the February-March issue of Cargo Security International, he said the situation had now changed.
The latest pirate attacks come at a particularly challenging time for the shipping industry.
Dubai-based DP World, one of the world's biggest port operators, warned last month that a falloff in global trade that began late last year "shows little sign of easing" because of the global recession.
Drewry Shipping Consultants Ltd. recently predicted cargo container shipments globally will drop 4.5 percent this year following decades of constant growth.
___
Associated Press Writers Adam Schreck in Manama, Bahrain, and Sean Yoong in Kuala Lumpur, Malaysia, contributed to this report.
Monday, March 30, 2009
SunTrust Insurance Head Wants Channel Change
By Matt Ackermann
March 26, 2009
Steven Turtz, the new president of SunTrust Insurance Services Inc., said he was hired to "significantly" expand the SunTrust Banks Inc. unit by increasing distribution within the bank."This is a business that is ready to explode," Turtz said in an interview last week. "We have critical mass and we have proven that insurance products can be delivered through SunTrust. Now, we just have to take it to the next level."Turtz, who succeeded David Sweigart, said there are a lot of ways to expand distribution through the Atlanta company's bank and wealth management channels.SunTrust Insurance currently offers its products and services almost exclusively to the bank's high-net-worth customers; if it can offer insurance products to all of the bank's customers, the revenue payoff can be considerable, he said."SunTrust Insurance was built as a boutique business to handle one segment of customers, but I really believe I was brought in to increase distribution to all customers," he said."There are distribution channels and customers that SunTrust Insurance is just not taking advantage of, including the retail channel," Turtz said. "I think we are in a perfect storm, because currently there are a lot of banking customers that are worried about their portfolios and their assets. We can present another product and another solution that just isn't discussed very often. We haven't taken advantage of all the customers that SunTrust provides banking to."Turtz, who started his new job last week after a stint with Comerica Inc., said he expects SunTrust Insurance's revenue to increase by 30% to 40% in the next 24 months and that he expects to double business in the next three years."Quite frankly, we are heading in the right direction and we have certainly made strides in the right direction," he said. "We have the people in place to help make this a mainstream product."In the past two years, SunTrust "didn't expand distribution" in insurance, he said."They filled a good space with SunTrust's wealthy clients, but since then they haven't taken advantage of their other channels. They became stagnant, and basically that is the reason I am here."Turtz said he plans to add staff to increase sales, including hiring from other banks. "There are a lot of quality people out there today because of this environment we are working in," he said. "My goal continues to be to find ways to grow and expand, and that requires people from both a sales and marketing perspective. Taking this organization to the next level means bringing on professional from wire houses and banks."SunTrust has steadily increased its insurance revenue over the past 10 years. According to data from Michael White Associates, a Radnor, Pa., company that tracks the investment and insurance industry, SunTrust ranked 33rd nationally in insurance brokerage income as of Sept. 30, with $12.2 million. Comerica ranked 51st, with $7.7 million."SunTrust has potential to grow, but it gets more difficult to get larger in terms of dollar volume as you keep climbing," Michael White, the company's president, said in an interview. "There is less room for growth at SunTrust than there was at Comerica. SunTrust is not a name you immediately think of in terms of their insurance business."Turtz spent two and a half years at Comerica. Before joining Comerica he worked at Highland Capital and Wells Fargo. He accepted the position at SunTrust "to work at a company with a real commitment to insurance," he said. It "is just a much, much bigger and broader business base and a company that has insurance entrenched in its financial planning model."That is not to say Comerica neglected the insurance line, but it was "more of a commercial bank," focused on its business customers, Turtz said. "The size and scale was just not as large. We were spending time building" the insurance business "on the retail and business side rather than thinking of it as a component of a wealth management platform.""In this environment, it is important to understand taking a consultative approach to selling products," he said. "Two years ago, customers were very concerned with returns. Now they are interested in products that are insured."Mr. White said Comerica, which was No. 72 in insurance brokerage income in March 2007, has "really been making good steady progress."
March 26, 2009
Steven Turtz, the new president of SunTrust Insurance Services Inc., said he was hired to "significantly" expand the SunTrust Banks Inc. unit by increasing distribution within the bank."This is a business that is ready to explode," Turtz said in an interview last week. "We have critical mass and we have proven that insurance products can be delivered through SunTrust. Now, we just have to take it to the next level."Turtz, who succeeded David Sweigart, said there are a lot of ways to expand distribution through the Atlanta company's bank and wealth management channels.SunTrust Insurance currently offers its products and services almost exclusively to the bank's high-net-worth customers; if it can offer insurance products to all of the bank's customers, the revenue payoff can be considerable, he said."SunTrust Insurance was built as a boutique business to handle one segment of customers, but I really believe I was brought in to increase distribution to all customers," he said."There are distribution channels and customers that SunTrust Insurance is just not taking advantage of, including the retail channel," Turtz said. "I think we are in a perfect storm, because currently there are a lot of banking customers that are worried about their portfolios and their assets. We can present another product and another solution that just isn't discussed very often. We haven't taken advantage of all the customers that SunTrust provides banking to."Turtz, who started his new job last week after a stint with Comerica Inc., said he expects SunTrust Insurance's revenue to increase by 30% to 40% in the next 24 months and that he expects to double business in the next three years."Quite frankly, we are heading in the right direction and we have certainly made strides in the right direction," he said. "We have the people in place to help make this a mainstream product."In the past two years, SunTrust "didn't expand distribution" in insurance, he said."They filled a good space with SunTrust's wealthy clients, but since then they haven't taken advantage of their other channels. They became stagnant, and basically that is the reason I am here."Turtz said he plans to add staff to increase sales, including hiring from other banks. "There are a lot of quality people out there today because of this environment we are working in," he said. "My goal continues to be to find ways to grow and expand, and that requires people from both a sales and marketing perspective. Taking this organization to the next level means bringing on professional from wire houses and banks."SunTrust has steadily increased its insurance revenue over the past 10 years. According to data from Michael White Associates, a Radnor, Pa., company that tracks the investment and insurance industry, SunTrust ranked 33rd nationally in insurance brokerage income as of Sept. 30, with $12.2 million. Comerica ranked 51st, with $7.7 million."SunTrust has potential to grow, but it gets more difficult to get larger in terms of dollar volume as you keep climbing," Michael White, the company's president, said in an interview. "There is less room for growth at SunTrust than there was at Comerica. SunTrust is not a name you immediately think of in terms of their insurance business."Turtz spent two and a half years at Comerica. Before joining Comerica he worked at Highland Capital and Wells Fargo. He accepted the position at SunTrust "to work at a company with a real commitment to insurance," he said. It "is just a much, much bigger and broader business base and a company that has insurance entrenched in its financial planning model."That is not to say Comerica neglected the insurance line, but it was "more of a commercial bank," focused on its business customers, Turtz said. "The size and scale was just not as large. We were spending time building" the insurance business "on the retail and business side rather than thinking of it as a component of a wealth management platform.""In this environment, it is important to understand taking a consultative approach to selling products," he said. "Two years ago, customers were very concerned with returns. Now they are interested in products that are insured."Mr. White said Comerica, which was No. 72 in insurance brokerage income in March 2007, has "really been making good steady progress."
Health Insurance Data Mistakenly Put Online
La Plata Patients Affected by Court Error Patients at a La Plata medical office are among about 250 people whose health insurance information was erroneously made public online by the U.S. District Court of Maryland.
The information was included in public documents through the federal court system's searchable online database, said a lawyer involved in the case. The breach was first reported Sunday by the Washington Examiner. The information has since been blocked from public view.
Some of the Washington area residents affected are patients at the Crain Highway medical offices where Abdul Fadul practices. Fadul, who is listed as an internist and cardiologist, and one of his partners, Ali Al-Attar, are under federal investigation on suspicion of health insurance fraud, according to court documents. Al-Attar, an internist, does not appear to practice in La Plata. Both doctors operate offices in Falls Church and Oxon Hill.
Al-Attar's attorney, Bruce Marcus, said that names, birthdays and health-care policy numbers were listed online for about 250 people. Social Security numbers were listed for about 50. Marcus said he did not know how many of those affected are patients at the La Plata clinic. Calls to the clinic and to Fadul's attorney, Paul Kemp, were not returned.
"The disclosure was done through government action, so they will have to do whatever is necessary to ensure that there is no untoward use of this private information," Marcus said. Calls to the court were not returned.
Federal officials raided the doctors' offices this month after an employee alerted them to suspicious billing methods. The doctors are accused of billing health insurance companies for more than $2 million worth of services they did not provide, according to court documents.
Corporations, universities and health providers have mistakenly posted private information online, exposing people to the risk of identity theft, according to the Electronic Privacy Information Center, a Washington-based research group. But Lillie Coney, the center's associate director, said she had never heard of a similar incident involving medical information obtained through online court documents.
"When a court posts medical information, it punishes patients who had nothing to do with the prosecution or the crime allegedly committed in first place," Coney said.
Such information is especially sensitive, she said, because a privacy breach could reveal a patient's medical conditions. The center has pushed for tighter restrictions regarding publicly accessible online court records, especially as it relates to people incidental to an investigation.
"It wouldn't have been enough just to black out the names, because patients can be identified by much more than just their name and Social Security number," Coney said. "And in a small community, there's an even greater ability to identify innocent people."
The information was included in public documents through the federal court system's searchable online database, said a lawyer involved in the case. The breach was first reported Sunday by the Washington Examiner. The information has since been blocked from public view.
Some of the Washington area residents affected are patients at the Crain Highway medical offices where Abdul Fadul practices. Fadul, who is listed as an internist and cardiologist, and one of his partners, Ali Al-Attar, are under federal investigation on suspicion of health insurance fraud, according to court documents. Al-Attar, an internist, does not appear to practice in La Plata. Both doctors operate offices in Falls Church and Oxon Hill.
Al-Attar's attorney, Bruce Marcus, said that names, birthdays and health-care policy numbers were listed online for about 250 people. Social Security numbers were listed for about 50. Marcus said he did not know how many of those affected are patients at the La Plata clinic. Calls to the clinic and to Fadul's attorney, Paul Kemp, were not returned.
"The disclosure was done through government action, so they will have to do whatever is necessary to ensure that there is no untoward use of this private information," Marcus said. Calls to the court were not returned.
Federal officials raided the doctors' offices this month after an employee alerted them to suspicious billing methods. The doctors are accused of billing health insurance companies for more than $2 million worth of services they did not provide, according to court documents.
Corporations, universities and health providers have mistakenly posted private information online, exposing people to the risk of identity theft, according to the Electronic Privacy Information Center, a Washington-based research group. But Lillie Coney, the center's associate director, said she had never heard of a similar incident involving medical information obtained through online court documents.
"When a court posts medical information, it punishes patients who had nothing to do with the prosecution or the crime allegedly committed in first place," Coney said.
Such information is especially sensitive, she said, because a privacy breach could reveal a patient's medical conditions. The center has pushed for tighter restrictions regarding publicly accessible online court records, especially as it relates to people incidental to an investigation.
"It wouldn't have been enough just to black out the names, because patients can be identified by much more than just their name and Social Security number," Coney said. "And in a small community, there's an even greater ability to identify innocent people."
Monday, March 23, 2009
Hannaford to Partner With Insurance Companies
SCARBOROUGH, Maine — As the nation’s health care costs continue to rise, Hannaford Bros.’ customers may get discounts on their insurance premiums under a new initiative in the works. The retailer plans to link its new myHannaford online shopping tool to health insurance companies’ customer reward initiatives, SN has learned.
Under a pilot program slated to kick off in the second quarter, several yet-to-be-named insurance companies will reward customers who buy healthy foods at Hannaford by giving them free gift cards for products that earn Guiding Stars, according to Julie Greene, Hannaford’s healthy living director. Discounts on monthly insurance premiums are also being discussed.
As proof that they’re buying healthy foods, customers would print out their shopping history via myHannaford and send it to their insurance company. Available via a link on the Hannaford.com website, myHannaford provides side-by-side comparisons of foods’ nutritional value, along with their Guiding Stars rating and price.
The insurance plan comes at a time when Safeway has said it plans to reward employees with premium reductions this year if their FoodFlex reports show that they’re buying healthy foods. FoodFlex is a personalized online food and nutrition tool that delivers a nutritional analysis of food purchases made with loyalty cards.
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© 2009 Penton Media Inc.
Under a pilot program slated to kick off in the second quarter, several yet-to-be-named insurance companies will reward customers who buy healthy foods at Hannaford by giving them free gift cards for products that earn Guiding Stars, according to Julie Greene, Hannaford’s healthy living director. Discounts on monthly insurance premiums are also being discussed.
As proof that they’re buying healthy foods, customers would print out their shopping history via myHannaford and send it to their insurance company. Available via a link on the Hannaford.com website, myHannaford provides side-by-side comparisons of foods’ nutritional value, along with their Guiding Stars rating and price.
The insurance plan comes at a time when Safeway has said it plans to reward employees with premium reductions this year if their FoodFlex reports show that they’re buying healthy foods. FoodFlex is a personalized online food and nutrition tool that delivers a nutritional analysis of food purchases made with loyalty cards.
Read More of Today's Headlines
Want to use this article? Click here for options!
© 2009 Penton Media Inc.
Ping An’s Chairman Ma Didn’t Take a Salary in 2008
Feb. 24 (Bloomberg) -- Ping An Insurance (Group) Co., China’s second-largest insurer, said Chief Executive Officer Peter Ma will forgo his salary for 2008 after the company lost $2.3 billion on its investment in Fortis.
Ma, who earned 66.16 million yuan ($9.7 million) in 2007, made the decision after the financial crisis “affected company performance,” Ping An’s Shenzhen-based spokesman Sheng Ruisheng said in a telephone interview today.
Ping An has forecast a “significant” drop in annual profit because of the decline in the value of its stake in Belgium’s Fortis, bailed out by three European governments last year. Ma, who earned 33 times more than his counterpart at larger China Life Insurance Co. in 2007, joins executives at companies from Citigroup Inc. to Sany Heavy Industry Co. who have taken pay cuts as the financial crisis erodes earnings.
“That was the company’s response to the public’s skepticism over its high compensation and management abilities” following the Fortis losses, said Olive Xia, an analyst at Core Pacific Yamaichi in Shanghai. “It can help restore investor confidence, but will have little effect on company profit.”
Ping An’s net income may have dropped by 30 percent from 2007 to 13 billion yuan last year, said Xia. The company, scheduled to release 2008 financial results April 10, has fallen 58 percent in Hong Kong trading since the start of last year.
Pay Cuts
Ma’s compensation compares with the 1.99 million yuan made by Yang Chao, chairman of China Life, the nation’s biggest insurer, in 2007, and 1.156 million yuan PICC Property & Casualty Co. paid Chairman Wu Yan for the same year.
Sheng declined to say whether Ma, 53, received the money and is returning it or didn’t get paid last year, as well as whether other Ping An senior executives or board members agreed to compensation cuts.
Ma, who has been with Ping An since 1988 when the company was set up and has been chairman since 1994, gave 20 million yuan from the 66.16 million yuan to Beijing-based charity China Soong Ching Ling Foundation, the company said. His income after tax and the donation was 25.794 million yuan.
Citigroup Chief Executive Officer Vikram Pandit said Feb. 11 that he will take a salary of $1 and no bonus until the bank, which has accepted $45 billion in government bailout money, returns to profitability.
Sany Heavy, China’s biggest supplier of concrete-making equipment, said Feb. 5 it plans to cut Chairman Liang Wengen’s annual salary to 15 cents and slash the pay of board members by as much as 90 percent in 2009 because of the financial crisis.
Fortis Stake
Ping An in November 2007 paid 1.81 billion euros for a 4.9 percent stake in Fortis, which became a casualty of the global credit crunch after pouring 24.2 billion euros ($31 billion) into the acquisition of ABN Amro Holding NV assets in 2008 just as the U.S. subprime-mortgage market collapsed.
The Chinese insurer voted against a state-organized breakup of Fortis, once Belgium’s biggest financial services company, on Feb. 11, saying asset sales driven by the Belgian government “severely impaired” shareholders’ interests. Ping An reported a third-quarter loss after a 15.7 billion yuan impairment charge on the Fortis investment.
Ping An Chief Investment Officer John Pearce left the company two months ago.
To contact the reporter for this story: Zhang Dingmin in Beijing at Dzhang14@bloomberg.net Last Updated: February 24, 2009 00:36 EST
Ma, who earned 66.16 million yuan ($9.7 million) in 2007, made the decision after the financial crisis “affected company performance,” Ping An’s Shenzhen-based spokesman Sheng Ruisheng said in a telephone interview today.
Ping An has forecast a “significant” drop in annual profit because of the decline in the value of its stake in Belgium’s Fortis, bailed out by three European governments last year. Ma, who earned 33 times more than his counterpart at larger China Life Insurance Co. in 2007, joins executives at companies from Citigroup Inc. to Sany Heavy Industry Co. who have taken pay cuts as the financial crisis erodes earnings.
“That was the company’s response to the public’s skepticism over its high compensation and management abilities” following the Fortis losses, said Olive Xia, an analyst at Core Pacific Yamaichi in Shanghai. “It can help restore investor confidence, but will have little effect on company profit.”
Ping An’s net income may have dropped by 30 percent from 2007 to 13 billion yuan last year, said Xia. The company, scheduled to release 2008 financial results April 10, has fallen 58 percent in Hong Kong trading since the start of last year.
Pay Cuts
Ma’s compensation compares with the 1.99 million yuan made by Yang Chao, chairman of China Life, the nation’s biggest insurer, in 2007, and 1.156 million yuan PICC Property & Casualty Co. paid Chairman Wu Yan for the same year.
Sheng declined to say whether Ma, 53, received the money and is returning it or didn’t get paid last year, as well as whether other Ping An senior executives or board members agreed to compensation cuts.
Ma, who has been with Ping An since 1988 when the company was set up and has been chairman since 1994, gave 20 million yuan from the 66.16 million yuan to Beijing-based charity China Soong Ching Ling Foundation, the company said. His income after tax and the donation was 25.794 million yuan.
Citigroup Chief Executive Officer Vikram Pandit said Feb. 11 that he will take a salary of $1 and no bonus until the bank, which has accepted $45 billion in government bailout money, returns to profitability.
Sany Heavy, China’s biggest supplier of concrete-making equipment, said Feb. 5 it plans to cut Chairman Liang Wengen’s annual salary to 15 cents and slash the pay of board members by as much as 90 percent in 2009 because of the financial crisis.
Fortis Stake
Ping An in November 2007 paid 1.81 billion euros for a 4.9 percent stake in Fortis, which became a casualty of the global credit crunch after pouring 24.2 billion euros ($31 billion) into the acquisition of ABN Amro Holding NV assets in 2008 just as the U.S. subprime-mortgage market collapsed.
The Chinese insurer voted against a state-organized breakup of Fortis, once Belgium’s biggest financial services company, on Feb. 11, saying asset sales driven by the Belgian government “severely impaired” shareholders’ interests. Ping An reported a third-quarter loss after a 15.7 billion yuan impairment charge on the Fortis investment.
Ping An Chief Investment Officer John Pearce left the company two months ago.
To contact the reporter for this story: Zhang Dingmin in Beijing at Dzhang14@bloomberg.net Last Updated: February 24, 2009 00:36 EST
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