Tom Flack looks at the stories creating the online clicks
As instability in the global financial markets soared to ever greater heights following the collapse of US investment bank behemoth, Bear Stearns, the online news sites were cooking on gas.
With analysts warning that insurers faced a double whammy of falling value in their assets and liability claims, Chubb’s £22m victory against Bear Stearns came as welcome news for the industry, and received heavy traffic as the news broke on insurancetimes.co.uk.
Another legal story proved the most popular of the week, with Oval reaching an out-of-court settlement with rival broker Berkeley Burke following a dispute over client poaching. The other stories featuring in the Most Read list were all relating to deals that have been done, or are set to conclude, among them CCV and IAG making significant additions to their organisations. Zurich reportedly finalising its offer for property insurance giant, EIS, and Jelf jostling for position in the acquisition race with Giles were also near the top.
Heath Lambert reported operating revenues of £113.1m, and grew its pre-tax profits by 6% to £18.5m. In keeping with its Lloyd’s rivals, newly redomiciled Hardy reported record 2007 pre-tax profits of £18.3m – despite an 8.5% hike in its claims ratio which inflated the insurer’s combined operating ratio to 80.5%.
The UK’s third largest insurer, Legal & General saw its operating profit more than halve in the second half of last year to £323m, missing analysts’ estimates. After forecasting in January a more challenging market for insurance and investment products, with demand being eroded by declines in house prices and tax rules, chief executive Tim Breedon warned that the full impact of the global credit crisis was still unclear.
Europe’s third largest insurer, Generali, posted a 21% increase in profit to €2.92bn (£2.28bn), driven by growth in its property and casualty lines. The insurer said its conservative strategy had helped it weather global market turmoil better than some rivals – and left it with €3.2bn of excess capital to spend on growth.
Online column inches belonged again to the credit crunch, despite some commentators saying its extent has been exaggerated.
With Northern Rock announcing plans to cut 2,000 jobs, FT.com reported that a tenth of London’s investment bankers were certain to lose their jobs in the first half of this year, some of 200,000 redundancies expected across the financial services sector in 2008. More worryingly, it pointed out that during the last economic downturn of 2001 to 2002, there were no net job losses.
Troubled US bond insurer Ambac rushed to quell fears of its own, with Reuters reporting the insurer’s claim it had only limited exposure to the collapse of Bear Stearns.
The most read stories this week on insurancetimes.co.uk:
1. Oval receives six-figure compensation
Settlement reached in consolidatorâ€™s legal battle with Berkeley Burke.
2. CCV buys Sussex broker
Purchase of Berkeley Alexander increases GWP to 160m pounds
3. IAG lands SME broker Barnett & Barnett
First commercial broker purchase will
provide springboard for groupâ€™s UK strategy.
4. Zurich haggles over Erinaceous price
Erinaceous is said to be seeking 100m pounds for its profitable broker division.
5. Jelf warns off Giles as acquisition war heats up
We are not for sale, chief executive Alway reassures staff.