Benmosche: Chartis Retaining
Customers; Did Not Underprice Business
BY ARTHUR D. POSTAL
Chartis companies have been able to retain 90 percent of their customers despite the economic
turmoil american international Group
has endured since 2008, aiG ceo robert
Benmosche said at a mid-February investment conference in manhattan.
“We still do business today with 97
percent of the Fortune 1000,” Benmosche
Insurance Groups
Praise China Trade
Talks on Auto
Insurance Market
Don’t kid
yourselves that you
can earn money in
investments and other
things outside the
combined ratio.”
AIG CEO Robert Benmosche
said. “this is not about getting clients; it’s
about doing more with clients.”
Discussing a broad range of topics at the
Bank of america/merrill Lynch insurance
conference on Feb. 15, Benmosche said aiG
is in the process of upgrading its worldwide
accounting system and taking a hard look
at its “catastrophe load and its reinsurance
contracts” as it assesses how to budget for
potential catastrophic losses going forward.
Benmosche added he’s not concerned
about the company being designated as
systemically significant and therefore
subject to regulation by the Federal reserve
Board. “people say, ‘are you worried
about being a siFi? are you worried about
the Federal reserve?’ no. i welcome it.”
he said aiG has “an enormous amount
of money” sitting at the holding company,
not at the regulated insurance entities,
so the company has enough capital to be
flexible in dealing with problems at the
operating level.
Benmosche also discounted talk that
chartis has been able to maintain its customer
list by substantively underpricing its products.
“the fact is, that is not true,” he said. “We’ve
demonstrated that with the data.”
he added that the company wants
to make sure it gets “a risk-adjusted
profitability in chartis, which means at
least earn your cost of capital.
“Don’t kid yourselves that you can earn
money in investments and other things
outside the combined ratio,” he added.
“Get it right and earn your cost of capital—
and then make a profit on top of it.”
Zurich Net Income Up 10% for Year;
Company to Propose Name Change
BY STAFF WRITER
Zurich FinanciaL services Group says its 2011 fourth-quarter net in- come fell 46 percent to $557 million,
but the company’s net income for the year
climbed 10 percent to $3.8 billion.
Zurich ceo martin senn also says
the company has proposed changing
its name from Zurich Financial services
Ltd. to Zurich insurance Group Ltd.
“in recognition of the fact that Zurich’s
strategic focus has been on insurance
for several years.” the name change
will be proposed to shareholders at the
company’s annual General meeting,
scheduled for march 29.
BY ARTHUR D. POSTAL
OFFICIALS OF THE American Insurance Association (AIA) and the Proper- ty Casualty Insurers Association of
America (PCI) are describing as “significant”
the outcome of China-U.S. trade-related
insurance talks.
David F. Snyder, AIA vice president and
associate general counsel, says that through
the Economic Track of the U.S.-China Strategic
and Economic Dialogue, China has agreed
to open up its Mandatory Third Party Liability
(MTPL) auto-insurance market to foreign
insurance companies.
“This development will bring more
choice for Chinese motorists, increasing
competition and improving service for
consumers in this major global auto
market,” Robert Gordon, PCI’s senior vice
president of policy development and
research, says in a statement.
China agreeing to open up its MTPL
market to foreign insurance companies is
credit positive for those insurers, says Moody’s.
Currently, foreign insurers’ market
share has been below 1.2 percent after a
decade of doing business in China, which
now bars foreign insurers from offering
MTPL, Moody’s says.
PCI and AIA are members of “Engage
China,” a coalition of 12 U.S. financial-services trade associations. The coalition
works to demonstrate how reform and
modernization of China’s financial sector is
essential for China’s long-term economic
growth and job creation. NU
