INSURANCE COMPANIES – AUSTRALIA

Bushfire claims could double

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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

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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

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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

Health insurance crisis looms

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Original article by Cliona O’Dowd
The Australian – Page: 17 & 18 : 9-Dec-19

Medibank Private’s chief customer officer David Koczkar and NIB Holdings MD Mark Fitzgibbon have stressed the need to reign in rising costs in Australia’s health care system. Private Healthcare Australia CEO Rachel David has warned that smaller private health insurers in particular may not be viable unless reforms are implemented. The federal government has approved a 3.27 per cent increase in Medibank’s premiums for 2020, while NIB and Bupa will lift their premiums by 2.9 per cent and 3.26 per cent respectively.

CORPORATES
MEDIBANK PRIVATE LIMITED – ASX MPL, NIB HOLDINGS LIMITED – ASX NHF, BUPA AUSTRALIA PTY LTD, PRIVATE HEALTHCARE AUSTRALIA LIMITED, AUSTRALIA. DEPT OF HEALTH, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, GRATTAN INSTITUTE

RACT marginally ahead of RAA in general insurance customer satisfaction

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Original article by Roy Morgan
Market Research Update – Page: Online : 28-Oct-19

RACT is the winner of Roy Morgan’s General Insurer of the Month Award for September 2019, with a customer satisfaction rating of 93%. The insurance arm of the Tasmanian motoring organisation now has an unbeatable lead in the general insurer category for the annual customer satisfaction award. South Australia-based RAA (92%) was a close second in the category, followed by People’s Choice Credit Union (90%), Shannons (90%) and Western Australia’s RAC (88%). The four leading general insurers improved their satisfaction ratings when compared to a year ago, with Shannons showing the largest gain of 5%. RAC was the only top-five general insurer that slipped in ratings over the same period, although it only declined 1%. These latest customer satisfaction ratings have been drawn from the Roy Morgan Single Source survey, derived from in-depth face-to-face interviews with around 50,000 Australians each year in their homes.

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

Watchdog takes aim at Medibank as patients denied payments

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Original article by Sarah-Jane Tasker
The Australian – Page: 17 & 21 : 4-Sep-19

The Australian Competition & Consumer Commission has launched legal action against Medibank Private, accusing the health insurer of making false representations about the benefits covered by its policies. It will be alleged that Medibank had wrongly advised customers that its AHM Lite and Boost policies did not cover medical procedures such as knee reconstructions and spinal surgery. ACCC chairman Rod Sim says this forced many policyholders to delay necessary surgery.

CORPORATES
MEDIBANK PRIVATE LIMITED – ASX MPL, AHM HEALTH INSURANCE, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION, FEDERAL COURT OF AUSTRALIA

S&P gives AMP thumbs down over bad news

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Original article by James Frost
The Australian Financial Review – Page: 19 : 28-Aug-19

The credit rating of wealth manager AMP has been downgraded from ‘A-‘ to ‘BBB+’ by S&P Global Ratings. The long-term issuer credit rating of AMP Bank and AMP Life have also been downgraded by one notch apiece. S&P has indicated that the ratings downgrade was primarily due to the recent deal to sell AMP Life to Resolution Life, which will have an impact on AMP’s group credit profile. S&P also said it may review AMP’s credit rating if the deal does not proceed, although this may not result in an upgrade.

CORPORATES
AMP LIMITED – ASX AMP, AMP LIFE LIMITED, AMP BANK LIMITED, S&P GLOBAL RATINGS, RESOLUTION LIFE GROUP LIMITED

Investors query AMP turnaround

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Original article by James Frost
The Australian Financial Review – Page: 17 & 22 : 9-Aug-19

AMP has announced a loss of $2.3bn for the first half of 2019 and a new strategy to turn around its fortunes. Amongst other things, the wealth manager aims to reduce costs by about $300m a year. AMP has also flagged plans to significantly reduce the number of financial advisers in its network and place more emphasis on so-called roboadvice. AMP will also continue to pursue the sale of its life insurance business to Resolution Life, while it will issue new shares at $1.50 apiece via a $650m capital raising.

CORPORATES
AMP LIMITED – ASX AMP, RESOLUTION LIFE GROUP LIMITED, MERLON CAPITAL PARTNERS PTY LTD, ALLAN GRAY AUSTRALIA PTY LTD

AMP’s credit ratings still at risk after stalled life sale

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Original article by Jonathan Shapiro, James Frost
The Australian Financial Review – Page: 13 & 16 : 17-Jul-19

S&P Global has advised that AMP’s credit rating will remain on negative watch after the Reserve Bank of New Zealand imposed conditions on the sale of its life insurance business. Nicholas Yap of Nomura believes that AMP is likely to face a credit ratings downgrade at some point, citing factors such as a reduction in the value of its life business and a class action lawsuit over excessive superannuation fees. AMP shares fell 1.6 per cent to $1.78 on 16 July.

CORPORATES
AMP LIMITED – ASX AMP, AMP LIFE LIMITED, S&P GLOBAL RATINGS, NOMURA AUSTRALIA LIMITED, RESOLUTION LIFE GROUP LIMITED, RESERVE BANK OF NEW ZEALAND, MOODY’S INVESTORS SERVICE INCORPORATED, MACQUARIE GROUP LIMITED – ASX MQG, CITIGROUP PTY LTD, MORGAN STANLEY AUSTRALIA LIMITED

AMP rattled as $3.3bn sale breaks down

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Original article by Cliona O’Dowd, Joyce Moullakis
The Australian – Page: 17 & 20 : 16-Jul-19

Shares in AMP closed 15.81 per cent lower at $1.81 on 15 July after the Reserve Bank of New Zealand thwarted the proposed sale of its life insurance division. The central bank said it would not support the sale of AMP Life NZ to the UK-based Resolution Life unless the assets underpinning New Zealanders’ policies are ‘ring-fenced’. AMP still hopes to secure a deal, but analysts say any sale now is likely to be at a much lower price than the $3.3bn that Resolution Life had agreed to pay. AMP has also advised that investors will not receive an interim dividend, citing uncertainty regarding the sale of AMP Life.

CORPORATES
AMP LIMITED – ASX AMP, AMP LIFE LIMITED, RESOLUTION LIFE GROUP LIMITED, RESERVE BANK OF NEW ZEALAND, ALLAN GRAY AUSTRALIA PTY LTD, MORNINGSTAR PTY LTD, REGAL FUNDS MANAGEMENT PTY LTD, SHAW AND PARTNERS LIMITED, MACQUARIE GROUP LIMITED – ASX MQG