Insurers face big loss from income policies

Original article by Michael Roddan
The Australian Financial Review – Page: 23 : 5-Jun-20

The Australian individual disability insurance sector has lost a combined $5 billion over the past five years. Australian Prudential Regulation Authority executive member Geoff Summerhayes warned in late 2019 that individual disability insurance products may soon become unviable in Australia if the industry did not take suitable action. However, despite his warnings and the sector’s ongoing losses, individual disability insurance providers are continuing to sell unsustainable products during the COVID-19 shutdown.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, CLEARVIEW WEALTH LIMITED – ASX CVW, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, WESTPAC BANKING CORPORATION – ASX WBC, AMP LIMITED – ASX AMP

Medibank mulls cash refunds

Original article by Joyce Moullakis
The Australian – Page: 16 : 7-May-20

Health fund Medibank Private expects its earnings and dividends to be in line with previous guidance, despite the coronavirus pandemic. Customers will save about $120m after Medibank opted to delay premium increases for six months, while CEO Craig Drummond has indicated that it may be open to providing partial refunds due to a fall in claims during the lockdown. NIB Holdings recently flagged the possibility of providing fund members with cash rebates due to the coronavirus.

CORPORATES
MEDIBANK PRIVATE LIMITED – ASX MPL, NIB HOLDINGS LIMITED – ASX NHF

Roy Morgan Customer Satisfaction Awards 2019: the best brands in banking and finance

Original article by Roy Morgan
Market Research Update – Page: Online : 25-Feb-20

The 2019 Roy Morgan Customer Satisfaction Awards have been presented in Melbourne. This year’s awards added six new banking and finance categories, taking the total list of winning banks, insurers and superannuation funds to fourteen. Commonwealth Bank (Major Bank) continued its dominance by securing its seventh straight customer satisfaction award. Bank Australia (Bank) and Newcastle Permanent Credit Union (Building Society/Credit Union) both recorded their first win of the annual award. RACT (General Insurer) and RAC (Major General Insurer) won their respective categories with seven and 12 monthly wins respectively. Insuranceline (Risk and Life Insurer) took out its third annual award, and MLC (Major Risk and Life Insurer) was a first-time winner. Tasmanian-based St.LukesHealth (Private Health Insurer), Defence Health (Major Private Health Insurer – Not for Profit or Restricted) and ahm (Major Private Health Insurer – Retail) were the other insurance category successes. Macquarie (Retail Superannuation Fund) fought off stiff competition to win another annual award, whereas Colonial First State (Major Retail Superannuation Fund) won comfortably with 11 monthly awards. HESTA (Major Industry Superannuation Fund) was welcomed to the winner’s podium for the first time.

CORPORATES
ROY MORGAN LIMITED

From bad to worse for AMP: $2.5bn loss, $6.3bn outflows, more to come

Original article by Joyce Moullakis
The Australian – Page: 19 & 23 : 14-Feb-20

Wealth manager AMP has posted a statutory loss of $2.5bn for the 2019 calendar year, while its underlying profit fell by 32 per cent to $464m. A $2.35bn impairment charge in the first half was the major contributor to the big loss. Meanwhile, AMP’s wealth division recorded net cash outflows of $6.3bn for the year, and CEO Francesco De Ferrari says outflows are likely to be high again in 2020. AMP has advised that its customer remediation program is expected to be completed in 2021.

CORPORATES
AMP LIMITED – ASX AMP

People’s Choice Credit Union – 95% customer satisfaction – highest satisfaction score in the general insurance category

Original article by Roy Morgan
Market Research Update – Page: Online : 21-Jan-20

People’s Choice Credit Union has won Roy Morgan’s General Insurer of the Month Award for November 2019, with a customer satisfaction rating of 95%. It is now ahead of RACT (92%), RAA (91%), Shannons (90%) and RAC (87%), and has won its second consecutive monthly award. Roy Morgan CEO Michele Levine says that while RACT has been the dominant brand throughout 2019, People’s Choice Credit Union has been the standout performer in terms of ratings growth, increasing its rating by 9% over the last 12 months. The latest customer satisfaction ratings are taken from the Roy Morgan Single Source survey, compiled by in-depth face-to-face interviews with over 50,000 Australians each year in their homes.

CORPORATES
ROY MORGAN LIMITED, PEOPLE’S CHOICE CREDIT UNION, RACT INSURANCE PTY LTD, RAA INSURANCE LIMITED, SHANNONS, RAC INSURANCE PTY LTD

Health funds fear surge in fire claims

Original article by Jared Lynch
The Australian – Page: 15 & 16 : 15-Jan-20

Private health insurers expect the bushfire crisis to result in a sharp increase in insurance claims, particularly from customers who have been affected by the smoke haze. However, they say it is too soon to determine the exact impact of the fires. Latrobe Health Services CEO Ian Whitehead anticipates a big increase in claims related to mental health issues arising from the bushfires, as well as physical health problems. Australian Medical Association president Tony Bartone says the longer-term effects of inhaling hazardous smoke will not be known for some time.

CORPORATES
LATROBE HEALTH SERVICES, AUSTRALIAN MEDICAL ASSOCIATION LIMITED, BUPA AUSTRALIA PTY LTD, MEDIBANK PRIVATE LIMITED – ASX MPL, AUSTRALIAN UNITY LIMITED

ASIC puts insurers on notice over bushfires

Original article by Max Maddison, Joyce Moullakis
The Australian – Page: 13 & 14 : 10-Jan-20

Suncorp has estimated that its bushfire claims for the current financial year have cost between $315 million and $345 million to date. Around 9,000 bushfire insurance claims have been made across New South Wales, Victoria, Queensland and South Australia since September, while the Australian Securities & Investments Commission has urged insurers to deal with bushfire claims fairly and efficiently. ASIC has warned consumers to be on the lookout for fraudulent tradespeople and repairers offering to help them with insurance claims.

CORPORATES
SUNCORP GROUP LIMITED – ASX SUN, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, RESERVE BANK OF AUSTRALIA

Bushfire claims could double

Original article by Joyce Moullakis
The Australian – Page: 13 & 14 : 8-Jan-20

The insurance industry has received some $700m worth of bushfire-related claims since September, according to data from the Insurance Council of Australia. More than 3,700 claims have been submitted to Insurance Australia Group to date, and CEO Peter Harmer says this figure could rise significantly in coming months. Harmer is among the insurance industry executives who met with federal Treasurer Josh Frydenberg on 7 January to discuss the need for a nationally co-ordinated response to the bushfire crisis. He has described the talks as "very constructive".

CORPORATES
INSURANCE COUNCIL OF AUSTRALIA LIMITED, INSURANCE AUSTRALIA GROUP LIMITED – ASX IAG, AUSTRALIA. DEPT OF THE TREASURY, SUNCORP GROUP LIMITED – ASX SUN, QBE INSURANCE GROUP LIMITED – ASX QBE

Wild firestorms to trigger $700m in insurance losses

Original article by Cliona O’Dowd
The Australian – Page: 13 : 7-Jan-20

Australia’s insurance industry is expected to be hard hit by the bushfires, with some estimates suggesting that the total cost of claims could top $700m. The Insurance Council of Australia has advised that the industry has received more than 6,000 bushfire-related claims since September, with the bulk of them having been submitted between November and 3 January. S&P Global Ratings says insurers could ultimately receive more than 10,000 bushfire-related claims.

CORPORATES
INSURANCE COUNCIL OF AUSTRALIA LIMITED, S&P GLOBAL RATINGS

Banks face stress test on climate

Original article by Michael Roddan
The Australian – Page: 1 & 2 : 20-Dec-19

Australian financial services providers may be required to disclose their exposure to climate risks in their financial statements. It is amongst reforms that are likely to be implemented by the Australian Prudential Regulation Authority and the Reserve Bank of Australia, which include subjecting banks and insurance companies to stress-testing with regard to climate change-related risks. The reforms have been proposed by the Network of Central Banks & Supervisors for Greening the Financial System. The RBA has been a member of it since 2018, while APRA has observer status.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, RESERVE BANK OF AUSTRALIA, NETWORK OF CENTRAL BANKS AND SUPERVISORS FOR GREENING THE FINANCIAL SYSTEM