EUROPA : launches Quantitative Impact Study for occupational pensions

he European Insurance and Occupational Pensions Authority (EIOPA) launches today the first Quantitative Impact Study (QIS) on Institutions for Occupational Retirement Provision (IORPs), as part of its process to advise the European Commission on the review of the IORP Directive. 

The QIS will assess the financial impact of different sets of options for the valuation of the holistic balance sheet and the calculation of capital requirements.

It will also deal with the quantification of the security and benefit adjustment mechanisms existing in different countries. The exercise is targeted at IORPs that run defined benefit pension plans.

IORPs that only provide pure defined contribution schemes are excluded from the scope. In order to facilitate the participation in the QIS of smaller IORPs, EIOPA developed so-called ’helper tabs’ – spread sheets that will assist IORPs in valuing sponsor support and pension protection schemes by using simplifications.

Nine European countries, in which defined benefit pension plans are most prevalent, have volunteered to participate in the study: Belgium, France, Germany, Ireland, the Netherlands, Norway, Portugal, Sweden and the United Kingdom. The national supervisory authorities (NSAs) are responsible for conducting the QIS in their country.

The exercise will be performed by either selected IORPs or by the NSAs themselves using real or aggregate data; or by actuarial firms acting on behalf of NSAs; or a combination.

EIOPA will coordinate the QIS at the European level, will be in charge of a question & answer procedure and will analyse the individual data in order to ensure consistency of the results.

The exercise runs until 17 December 2012 and the report on the QIS outcome is expected to be released in spring 2013.

Gabriel Bernardino, Chairman of EIOPA, said: “I am pleased that we have been able to take this important step in the development of a new European framework for occupational pension funds. In our advice to the European Commission we proposed the holistic balance sheet (HBS) concept as a means to capture the wide diversity of retirement systems in a single prudential regime. This QIS will allow us to investigate the feasibility of implementing the HBS in practice”.

Reliance Life Insurance begins post-sales service in insurance market

NEW DELHI: Taking a leaf out of its Japanese partner Nippon Life's book, private sector insurer Reliance Life has begun its post-sales service drive across the country and plans to cover over 10 lakh customers by March next. 

Reliance Life Insurance Company (RLIC) has asked its 1.5 lakh representatives, including staff, advisors and channel partners to meet about ten per cent (over one million) of its existing customers by end of current fiscal to provide services beyond premium collection. 

RLIC, part of Anil Ambani-led Reliance Group's financial services arm Reliance Capital, has begun this drive under its 'Reliance Life Plus Club' initiative. 

According to RLIC, it is the first Insurance company in India to introduce a structured post-sales customer service platform. 

Commenting on the new initiative, RLIC President and Executive Director Malay Ghosh said: "Our post-sales service drive is already in force and action is part of our daily business routine. We have instructed over 1200 pan-India branches to implement it like sales targets. We hope to meet one million customers by March 2013".

The initiative is inspired by 'Zutto Motto' (Forever More Service) service at Nippon Life, Japan's leading insurer and Reliance Life's strategic partner with a 26 per cent stake. 

"We hope to replicate the success that this model enjoys in Japan," Ghosh said. 

Post-sales service is a widely prevalent practice in a host of consumer-focused businesses, including consumer goods and home appliances. 

It involves a continued relationship between the company and its customers through maintenance and advice-like offerings for years after the actual sale. 

Stressing on the need for an after-sales service, Ghosh said that life insurance is a long-term product and the customers' needs may change over a period of time. 

"It is very important for sales agents to periodically visit the customers to find out their diversifying needs in their various life stages. This is the key point in enhancing customer satisfaction," he said. 

"We have made it a rule that all our sales people visit every customer periodically at least once a year. Such visits also help in selling new products to the existing customers and in acquiring new clients," Ghosh added. 

The company is spending about Rs 12 crore in the current financial year for this initiative to meet about 10 per cent of its customer base. At present, Reliance Life has more than nine million policyholders.

Metropolitan Police Commissioner Bernard Hogan-Howe visited MIB

Bernard Hogan-Howe, Commissioner of the Metropolitan Police, visited the Motor Insurers’ Bureau (MIB) on 8 October 2012 to see first-hand how MIB supports his officers in the Capital, as well as all police officers in the UK, in taking uninsured cars off the road.

During the visit, Commissioner Hogan-Howe met with MIB Chief Executive, Ashton West and MIB Chairman Keith Morris. Commissioner Hogan-Howe then listened in to calls coming in to the dedicated Police Helpline from road-side officers with vehicles they suspected of being driven without insurance.

The Metropolitan Police are targeting uninsured drivers through Operation Cubo – a sustained programme across the network of roads around the capital. The monthly operation sees mobile checkpoints appearing on London’s roads with Roads Policing teams using automatic number plate recognition (ANPR) cameras, which are connected to MIB’s Motor Insurance Database via the Police National Computer.  It quickly indicates whether or not a vehicle is on the database. To date, around 37,000 vehicles have been seized by the Met since Operation Cubo began in October 2011.

Recently, a £227,000 Ferrari FF was seized for having no insurance in the Royal Borough of Kensington and Chelsea and was put on display outside Scotland Yard alongside an £18,000 Mercedes – also seized for no insurance.

The UK’s level of insured driving has fallen by 30% in the last five years and is currently estimated to be 1.2m.

HSBC : over half of family lenders expect loans repaid and three quarters expect interests

More than half of family members that give money to first time buyers (FTBs) expect to get it back – and three quarters want to be paid interest on top.

The ‘bank of mum and dad’ has its own terms and conditions according to new research from HSBC. While almost one in five (19%) first time buyers (FTBs) received family financing in the last year, more than half (52%) of family members who offered financial assistance provided it with an expectation to be paid back.

Just 31% of those families who offered financial assistance to their FTB relatives gave outright cash gifts as the primary source of family financing, and even fewer (17%) requested part-ownership in the property in order to collect their money when the house is eventually sold on.

The survey of 1,000 FTBs revealed that for those who expect to be paid back nearly three quarters (73%) want to be paid interest as well. The most common rate ranged between 2.1% and 2.5%, around the current rate of inflation. Women are slightly less likely to be asked to pay interest than men, (70% vs. 77%). The bank of mum and dad is also more likely to ask for interest if their FTB relative is purchasing a first home with a partner (75%), rather than on his or her own (69%).

How likely families are to charge interest to their FTB relatives also differs by region. In the South East, 56% of families want interest to be paid on any financial assistance they offer to the FTB. In London, this figure rises to 77%. Moving north, families are even keener to be paid interest. In Yorkshire, 92% of families who help their FTB relatives request interest, as do 94% of families in the North West.

The size of the property is another important factor at the bank of mum and dad, with purchasers of larger homes more likely to be asked to pay interest than those buying smaller ones. More than 8 out of 10 (82%) families lending to an FTB buying a detached house expect to receive interest, compared with 72% of those buying a semi-detached house, and 63% of those purchasing a terraced property.

Peter Dockar, Head of Mortgages at HSBC, commented: “Family support has become an important part of the first-time buyer financing mix, however the research shows that many relatives would like to be repaid at a later date. To avoid unnecessary strain on relations further down the line it is best to agree the terms with family members at the outset. Whether first time buyers receive financial support or not, we will continue to offer accessible mortgages at competitive interest rates.

THE BANK OF MUM AND DAD – KEY FACTS:

1. One in five (19%) of families provided some sort of financing to the first-time buyer relatives last year.
2. Of the families that provided financing, approximately 52% want to be repaid.
3. Only 31% of families providing family financing give an outright gift as the primary source of family financing.
4. Some 17% of those families who provided family financing bought a part-share in their FTB relative’s home as the primary source of family financing.
5. Nearly three-quarters (73%) of families who want to be repaid also charge interest.
6. Families are more likely to charge interest to males (77%) than to females (70%)
7. Families are more likely to charge interest if their FTB relative is purchasing a first home with a partner (75%) rather than on his or her own (69%)
8. More than 8 out of 10 (82%) families expect to receive interest if they offer assistance on a detached house, compared with 72% and 63% for semi-detached and terraced houses respectively.
9. For those families providing family financing, some form of gift is provided to 80% of FTBs
10. Some 83% of FTBs whose families have provided family financing and who purchased their first home with a partner get some form of gift, compared with only 75% for those who purchased without a partner.

Caregiving for an elderly or sick loved one: people's panel

We're collecting stories from people who care for loved ones while also taking care of themselves. Photograph: Corbis

Read a selection of the responses here

If you're one of the millions Americans who struggles to care for an aging or sick loved one while holding down a job and raising children, chances are you want to scream. And you're not alone.

According to a new report from the AARP, 42 million Americans perform some form of consistent care for older or impaired adult relatives or friends. These caregivers, though many don't identify as such, provide a staggering $450bn worth of unpaid care annually in the US.

Caregivers take on extra responsibilities that range from paying bills, to driving mom to doctor appointments, to more hands-on care such as bathing, and even tasks once left to nurses such as the care of open wounds. What's more is that AARP research makes clear that the stress and time involved can take a toll on the caregivers' own health and finances, as they put off their own doctor visits, dip into their savings and cut back their working hours.

As part of our people's panel series, we're collecting stories from people who care for loved ones. What's been your experience? Are you stressed? Or do you love to help? Answer the questions below and we'll feature your story on the Guardian.

Points record is licence for car insurance firms to raise premiums

I got three penalty points on my driving licence that were removed last month after the statutory four-year period. But when I attempted to renew my car insurance I was told by my provider that it retains points on its records – and charges the consequently higher premiums – for five years. I have paid the price for my speeding offence; surely it's unethical that my provider should punish me for an additional year. DG, Woodford Green, Essex

You've guessed the reason: money. Insurers price their policies according to the perceived risk of a claim. The riskier a customer's profile is perceived to be, the more they'll be charged and, although new laws forbid firms from taking gender into account they are free to use other personal circumstances to calculate premiums.

Most insurers will require details of any endorsements or convictions for the last five years and, although you say this is the only time you've ever been penalised for speeding, if an insurer's claims history shows that customers with speeding convictions are more likely to make a future claim, it will judge you to be a higher risk even after your penalty has expired.

Drivers should spend a year as learners, insurers say

The Association of British Insurers says a minimum 12-month learning period would enable young drivers to gain more supervised practice. Photograph: Alamy

Novice drivers should be subject to restrictions on night time driving and a reduced drink driving limit, according to the Association of British Insurers.

It also recommended learners spend at least a year displaying their L-plates before being allowed to take a driving test, although young people could start learning six months earlier than the current age limit of 17.

The minimum 12-month learning period would allow young drivers to gain more supervised practice, the ABI said, as it called for graduated driver licensing for the first six months after passing a driving test.

This would include restrictions on the number of young passengers that can be carried by a newly qualified driver, restrictions on driving between 11pm and 4am, and no blood alcohol content.

According to the ABI, only one in eight licenced drivers in the UK is aged 25 or under, yet they account for a third of those killed on the roads.

The association said that an 18-year-old driver was more than three times as likely to be involved in a crash as their 48-year-old counterpart. In addition, 27% of personal injury car insurance claims in excess of £500,000 result from a crash involving a driver aged 17-24.

Director general of the ABI, Otto Thoresen, said: "Radical action is needed to reduce the tragic waste of young lives on our roads."

"A car is potentially a lethal weapon, and we must do more to help young drivers better deal with the dangers of driving. Improving the safety of young drivers will also mean they will face lower motor insurance costs.

"We have all sidestepped this issue for too long. Northern Ireland is introducing reforms, and politicians in Westminster should follow their lead in introducing meaningful reform to help today's young drivers become tomorrow's safer motorists."

The report looked at policies adopted in other countries and found that graduated driver licensing had reduced the number of crashes involving young drivers.

It said: "The situation can be improved and countries similar to ours such as the United States, Canada, Australia and New Zealand have introduced bold measures that have improved the safety of young drivers, namely introducing graduated driver licensing."

Young drivers have faced steep rises in insurance costs over the past few years. In April, figures from the AA showed that while premiums for men aged 40-49 had gone up by 6% since April 2010, those aged 17-22 had seen increases of 40%. It is not uncommon for young drivers to be quoted thousands of pounds to cover their car.

Car insurers have been introducing telematics technology which tracks how a car has been driven as a way to reward young motorists who drive carefully and at the safest time of day, and research by one insurer suggested this is effective.