Chinese insurance companies invest $39 billion in the foreign share markets
Written on 20 April 2008 by adminChinese insurance companies are ready to invest in foreign securities more than 300 billion yuans ($39,5 billion) after reception of the corresponding sanction from the government of the country. According to the new rules of investment for the insurance companies, which is to come into force on July, 25th, the limiting size of a share of actives is increased from 5 % up to 15 %, which insurers can use for investments abroad. Such information has been represented in the message of the Commission on regulation of the insurance market of China. Besides own capital of the insurance company should make not less than 10 % from its actives.
At end of 2006 the total sum of actives of the Chinese insurance companies was equaled to 2 bln. yuans ($263 billion). Introduction of new regulations became excellent news to Hong Kong as first of all, in observers’ opinion, insurers will be interested in Chinese companies’ shares, traded at the Hong Kong stock exchange - it will be so-called “Hâ€-category shares. The analyst of company Shenyin and Wanguo Securities Yu Bin expresses following opinion: “In view of a proceeding strengthening the Chinese national currency, the greatest interest for the insurance companies is represented with investments into foreign actions, instead of bondsâ€. Bank deposits, bills, bonds, monetary shares’ funds and the action can become new rules objects of investment.
I - Incomplete insurance, Infringement of insurance terms …
Written on 15 April 2008 by adminIncomplete insurance
Case in brave insurance, when the risk is insured for the sum, is less than the valid cost of property. In such cases compensatory payments decrease proportionally to difference between real and insured cost of risk.
Infringement of insurance terms
If the insurant breaks terms of insurance, the insurer can refuse performance of obligations taken by him under the contract
Insurance
The term designating the attitudes on protection of property interests of physical and legal persons at approach of certain events (insurance cases). Distinguishes voluntary and obligatory insurance.
Insurance case
The event, stipulated by the insurance contract, according to which the Insurer is obliged to indemnify received by the insurant.
Insurance cost
Cost of insured property at the moment of insurance contract signing. It is defined by the Insurer on the basis of the payment documents, given by the Insurant or with application of specialized directories.
Insurance coverage
The list of risks from which the insurance contract protects.
Insurance maintenance
The insurance payments made at insurance case or to the successor under the law.
Insurance premium
Payment for insurance which the Insurant is obliged to pay to the Insurer by way in terms, which are established by the contract of insurance.
Insurance risk
Probable event at which insurance case occurs.
F - Franchise
Written on 15 April 2008 by adminFranchise
Part of the losses, which are not the subject of compensation by the Insurer. The franchise is established in a sum of money. The franchise is the form of own participation of the Insurer in a loss covering. Presence of the franchise allows lowering the size of the insurance premium.
D - Damage, Disability
Written on 15 April 2008 by adminDamage
Monetary or property losses of the insured person, it is the result of illegal actions of the third parties in relation to the insured person and its property in result of road accident, fire and the other, stipulated, in the contract terms.
Disability
The invalidity releasing the physical person from performance of work for the term of treatment and full working capacity restoration.
Insurance market has passed a boundary
Written on 11 April 2008 by adminForeign brokers can work without representations
Yesterday the parliament has resolved insurance and reinsurance brokers-non-residents to render services, not opening representation in Ukraine, and only in writing notifying about the plans. Experts consider that new rules will considerably simplify work to the foreign companies and will allow Ukrainian insurers to enter easier international markets owing to overflowing of the capital requirements’ facilitation.
Yesterday within the limits of ratification of the contract on Ukraine’s access to the WTO, the Supreme Rada has brought changes to the law On insurance with the help of which it has simplified terms of national and foreign insurance brokers activity in Ukraine. In particular, the norm that brokers-non-residents can render services only through permanent missions in Ukraine, which should be registered as tax bearers and that they should be included into the state registry insurance or reinsurance brokers, has been cancelled. Foreigners have acquired the right to carry out in territory of Ukraine the activity regarding insurance of the risks connected with sea transportations, commercial aircraft, start of space rockets and the freight (including satellites) right after Ukraine will join WTO.
Thus the Ukrainian players mark that all large risks have been already reinsured abroad and, consequently, struggle for this market will carry out between foreign brokers.
C - Civil liability, Co-insurance
Written on 8 April 2008 by adminCivil liability
Responsibility of the person for drawing of life, health or property damage of the third parties. Civil liability insurance assigns payment to the insurance company.
Co-insurance
Insurance at which two and more insurers possess the certain shares in the same risks’ insurance, giving out joint or separate policies, according to the insurance sum of the share.
B - Broker
Written on 8 April 2008 by adminBroker
Intermediary between the insurance company and the insurer at the insurance contracts signing. The broker should be the expert in the field of the legislation and insurance practice.
A - Actuary, Annuity, Assistance
Written on 8 April 2008 by adminActuary
Expert on the insurance mathematics, owning the theory of actuary calculations regulating mutual relations between the insurer and the insurant.
Annuity
Insurance contract according to which the insurer in exchange for payment of the insurance premium undertakes to pay the regular income (rent) to the insured party.
Assistance
Services of medical, technical or financial character, which occur according to the terms of the travellers insurance contract at insurance case: traumas, diseases, etc.
Space risks insurance market (Part 2)
Written on 4 April 2008 by adminIn September, 1984, in result of supernumerary work of a step «Centaur» of BR «Atlas-Centaur» “Intelsat F-9″ was lost. The sum of insurance compensation has made 102 billion dollars.
Thus, within 1984 three insured SVs were lost. Four SVs were lost in 1985 and three of them were insured. SV «Syncom IV-3» has not been put into operation after branch from «Space Shuttle», later during other flight «Space Shuttle» it has been deduced into a working orbit and put into operation. Nevertheless, compensation in 85 million dollars has been paid. Destruction of SV “Syncom IV-4″ for the unknown reason after successful start and orbital checks cost to insurers in 84 million dollars.
Thus, during 1982-1988 international space risks insurance market stays in quite uncertain state.
As a whole, for the period since 1984 till 1989 regular unprofitability was observed in the marked. Insurance compensation exceeded the sizes of the collected insurance premium. Thus 1989, when premiums and compensation were made even then down to 1998 collected premiums exceeded insurance compensation, became the critical year in space risks insurance market.
During 1989 -1994 market situation was stable. The market capacity met needs of operators. The majority of insurance premiums acted from insurance of starts of SVs from BR «Ariane». Thus specified BR had only one emergency start («Ariane-V36», on February, 22nd, 1990) in a series from 35 starts for last 5 years.
1994 became the hardest year from the moment of the beginning of space risks insurance and on results of this year the market has incurred the loss in 198 million dollars. About 75 % of insurance payments have been caused by refusals of third step of BR «Ariane-4».
In 1999 the international insurance market became the witness of the first successful start under the program «Sea Launch» (on March, 28th).
In 2000 31 starts have been carried out. This year has begun with two starts, which are still remaining of great importance for the insurance market:
* On February, 12th SV «Garuda-1» has been put successfully into orbit from BR “Proton”. The insurance sum made 478 million dollars and it was the highest insurance sum for the individual SV start;
* On March, 21st BR «Ariane-5» has carried out the first successful start of two SVs «Insat-3B» and «Asiastar-1».
As a result, in 2001 growth of rates, reduction of volumes of an insurance covering and change of conditions of insurance of start and operation in an orbit were observed. A lot of projects were insured not on 100 % of the insurance sum, but only on 75-80 %.
In 2002 27 starts are carried out, including 21 successful commercial starts.
First three quarters of year were encouraging for the insurance market: all starts were successful except for failure of BR “Union” on October, 30th, which has rendered extremely insignificant influence on the insurance market.
Thus, 2002 was marked by continuation of constructive refusals and destructions КРon platforms Boeing-702, Boeing-601, Spacebus-3000, Spacebus-2100 and LS-1300.
Besides during settlement by the market claims approximately on 1.7 billion dollars for 6 КРon platform Boeing-702 continue to be.
In 2003 the market of insurance was characterized by following features:
*Rates on start remained high - from 20-23 % up to 28-30 %;
*Insurance coverings of operation risk deviated from 2.7 up to 3.7 %;
*Risks’ accommodation collided with insufficient market capacity;
*Overcautious persons were inclined to adhere to their market share irrespective of the insurance sum;
*The tendency to reduction of coverings’ duration has proceeded - standard coverings last no more than for 12 months; there were rigid requirements on stocks of fuel (in 1 year) and energy (7.5 % in the end of term of active existence), full constructive destruction (75 %), exception of “serial” refusals, introduction of franchises;
* Rates’ quotations were given for short term - from 7 till 30 days, or up to the first insurance case in the market, but not earlier than 12 months before the start.
2004 has continued to a turn of unpleasant events for space risks’ insurers. For example, on January, 11th, SV «Telstar-14», after deducing of SV «Telstar-14» into orbit one of solar batteries has not revealed.
Space risks insurance market (Part 1)
Written on 31 March 2008 by adminToday space risks insurance Market is one of the most interesting and technically complex markets, from the point of view of an estimation of insurance risk and the organization of insurance, segments of the insurance market.
1. Historical retrospective
The industry of space risks insurance has been created in the middle of 60th years XX century, when in result of space activity commerciality the demand for indemnification of losses from realization of space risks - in particular, risks of space vehicles’ (SV) destruction and damage of during the periods of prestarting preparation, start and operation, has occurred.
In 1965 the first contract of responsibility insurance before the third parties during prestarting preparation of SV “Eаrly Bird” has been signed, and the basic approaches to SVs’ insurance have been developed till 1968, when after six starts of SV “Intelsat” (four starts were successful) following series of “Intelsat-3″’s starts have been insured.
In September, 1977, SV “O.T.S.” (Orbital Test Satellite), started by booster rocket (further under the text - BR) “Delta-3914″, has been insured for the sum of 29 billion dollars. Both BR “Delta-3914″ and SV “O.T.S.” have been destroyed at еру start.
In February, 1979 failure of third step of BR “N-II” caused destruction of SV «E.C.S.» (Experimental Communication Satellite), insurance compensation has made about 14 million dollars. The following start under program SV «E.C.S.-2» in February, 1980, was also unsuccessful.
More serious incident has occurred in December, 1979 when, because of supernumerary work of engine SV “Satcom-3″ and 77 million dollars were lost. Nevertheless, the space risks insurance market continued to develop.
Despite of insurance companies’ losses, a number of new contracts were signed in 1982. The insurance premium at start of SV “Intelsat” has made 8 %.
