| |
|
Home >
eWeekly News >
News Archives (eWeekly Australia)
|
|
|
| |
| |
|
|
|
|
|
| 1. |
Australian Insurers' Exposure To Asian Tsunami Minimal |
Initial estimates by ratings agency Standard & Poor's indicate that the recent earthquake-tsunami catastrophe in Indonesia, which has caused massive damage in South and Southeast Asia, is unlikely to have a major impact on the Australian insurance companies.
Sydney-based insurer QBE Insurance Group, which is expected to be worst hit by the Asian earthquake due to its various operations in affected areas, is confident the disaster will not adversely affect its 2004 profits. Therefore it will not be changing the group's 2004 earnings targets. According to a QBE spokesperson, the company has had been reducing its reinsurance exposure in Asia over the last couple of years.
News of substantial damage caused by the deadly tsunamis, which ravaged many parts of Asia, earlier sent Australian insurance and travel stocks tumbling. However, assurance of minimal damage from the various sectors in the industry later triggered a rebound for the stocks.
Based on initial estimates by Lloyd's of London, the Asian disaster is likely to cost up to US$13 billion in insurance exposure. So far, the death toll from the December 26 earthquake, which measured 9.0 off the Indonesian island of Sumatra, has killed more than 144,000 people as of January 3, 2005, and continues to rise.
|
|
| 2. |
General Insurers Look To A Robust 2005 |
Thanks to a strong bill of health in investment returns and a more rational approach to pricing policies, the general insurance sector looks well-placed to continue its momentum into 2005. The only blip on the horizon would be from unsustainable factors such as weather and terrorism. However, market observers reckon such uncontrollable factors are unlikely to create too much of a stir.
As a case in point, the quake-tsunami that devastated the coastal regions of Southeast Asia did not materially impact QBE Insurance, which is the biggest underwriter for Lloyd's of London.
Wilson HTM Research Analyst Brett Le Mesurier sees companies staying their course on making money from underwriting risk rather than investing, to ensure an acceptable return on equity. He believes this theme will continue, with continued rational pricing behaviour and focus on costs starting to come through to improve results. Merrill Lynch Analyst Bob Leung foresees the strong equities market benefiting insurers.
The next 12 months should also see further consolidation, cost-cutting and reduction in duplications among the country's 150-plus insurers, which is currently toplined by IAG, QBE, Suncorp-Metway Ltd, Promina Group Ltd and the Australian arm of German giant Allianz AG collectively holding 79% of the Australian market.
The introduction of a capital-based risk regime after the HIH debacle has driven insurers to raise premiums in order to meet the new benchmarks, which has in turn pushed a return to underwriting profit in the past two years. Mr Leung, however, cautioned that with insurers being lured back into the market, this could end up pushing premiums down.
|
|
| 3. |
Reports Reveal Obstetricians Hit Most By Negligence Claims |
Preliminary figures released by the Australian Institute of Health and Welfare show that obstetricians are the hardest hit not only in terms of negligence claims but also costs. January-July 2003 saw more than 2,600 claims, with 15% of these against obstetricians. The cost of claims against obstetricians was also much higher than average, with 16% expected to cost more than A$500,000 compared with 6% for overall claims.
Accident and emergency units comprised 13% of all claims, followed by general surgery with 11% and gynaecology at 9%. Most of the claims were from metropolitan areas, with 21% arising from inner regional areas such as the Gold Coast.
Gold Coast Division of General Practice President Peter Meulman told press that the results were not surprising as obstetricians are often sued for lifelong care of a disabled child. He noted that the irony was the most of the money awarded ended in the pockets of the caregivers and solicitors rather than the patient.
But there may be light at the end of the tunnel with the Federal Government's rescue package which is an agreement to underwrite high-cost claims to help stabilise the medical insurance industry. United Medical Protection (UMP) has also said it is going to lower premiums for 70% of doctors by 10%-30%.
The new national medical indemnity database is the first of its kind in Australia to track medical indemnity claims made against doctors in the public health system, and was created after the collapse of United Medical Protection which left thousands of Queensland doctors uninsured.
|
|
| 4. |
Pharmacies Caught Out After Increased Audits |
The Health Insurance Commission's stepped-up audits on the pharmaceutical industry have flushed out 489 pharmacists for filing suspicious reimbursement claims or breaching rules on supplying prescription medicines in the past financial year. This is more than twice the number of the previous financial year of about 187.
The stepped-up audits involved the commission scrutinising cases where pharmacies claimed twice or more for the same prescription; the profession claims public funds for dispensing taxpayer-subsidised drugs.
The Pharmacy Guild of Australia's President, however, responded that the amount of fraud in the system was negligible, and that most technical breaches were not frauds but cases of pharmacists trying to help elderly customers who had mislaid copies of their repeats for a prescription.
According to the commission, the data was published as the Federal Government is considering cutting the fees it pays medicine wholesalers for delivering drugs and vaccines. Under the present deal, medicine wholesalers are paid a 10% markup on the cost of every PBS drug they deliver to chemists regardless if delivery costs were the same for two differently valued parcels.
This fee structure effectively pushes up the cost to taxpayers of the A$6 billion-a-year Pharmaceutical Benefits Scheme (PBS), which is already under strain.
|
|
| 5. |
Burglars Go For Jewellery, Video Game Consoles This X'mas |
According to leading Australian insurer NRMA Insurance, jewellery topped the list of "most stolen items" between November 2003 and October 2004. Not surprisingly, this was number one on the wish list of thieves this X'mas, with video game consoles and games following suit.
Burglars would also be tempted by new unwrapped goods as these could be readily resold or returned. Next on the list, according to NRMA Insurance, were household electrical goods such as televisions, DVD players, video recorders and home stereos. Cameras came in fourth, followed by computers, mobile phones, cash, CDs and DVDs as well as sporting equipment and bicycles.
|
|
|
|
|
|
|
|
