itij - s3-eu-west-1.amazonaws.comissue 57 • october 2005 itij the economic losses from hurricane...

ESSENTIAL READING FOR TRAVEL INSURANCE INDUSTRY PROFESSIONALS

International Travel Insurance Journal

6 Page 26Page 22 Page 24

ISSUE 57 • OCTOBER 2005

ITIJITIJThe economic losses from Hurricane Katrina thatswept along the Louisiana, Mississippi and Alabamacoasts on the 29 August, and the following floodingof New Orleans are now being estimated at morethan $100 billion – the most damaging flood in UShistory, and the most expensive storm-related event

ever for insurers. Milan Korcokreports on the worst hurricane theUS has seen in a long time

According to Risk ManagementSolutions (RMS), a California-based riskassessment company, insured lossesfrom Katrina's direct impact have risento $35 billion in the wake of NewOrleans' flooding, up from an initialestimate of $25 billion. That increasewas based on more detailedinformation from aerial and groundreconnaissance as well as updatedreports on flooding damage thatoccurred in New Orleans after thehurricane had passed.According to the Insurance InformationInstitute, this would exceed insuredlosses from previous record-settingHurricane Andrew in South Florida in1992, which caused an inflationadjusted $21 billion in property losses,and all of the four hurricanes whichdevastated different segments of Floridaand the Caribbean last year and whichcaused estimated property losses of$22.9 billion. The 2001 terrorist attacksin New York and at the Pentagonresulted in insured property losses ofjust over $21 billion.By contrast, insured losses associatedwith the 26 December Indian Oceantsunamis were estimated by Swiss Reas totalling between $2.5 billion and $4billion, due to low property insurancetake-up and relatively low property

values in the affected areas. Total economic losses,including both insured and uninsured losses, wereestimated by Swiss Re and Munich Re at up to $14billion.At least 50 per cent of loss attributable to Katrina isexpected to come from flooding and its aftermath inNew Orleans, says RMS, which estimates that at least150,000 properties have been flooded, surpassing theprevious US record from flooding and levee failureson the lower Mississippi River in 1927, which flooded137,000 properties. Insurance analysts also estimatethat six out of 10 homeowners and businesses inNew Orleans and the Gulf Coast may lack floodinsurance, meaning they will get little recovery fortheir losses. Homeowners insurance does not coverloss from flood.The closest analogy to the New Orleans flood, whichresulted from broken levees holding waters from LakePontchartrain, was the 1953 flood in the Netherlands,which was also caused by wind-driven storm surgethat broke through dikes protecting land below sealevel. That flood led to more than 1,800 deaths andthe flooding of 47,000 properties. The death toll fromthe New Orleans flood has not yet been tallied but itmay well exceed 1,000, according to local authorities.“The economic and insurance consequences of the2005 Great New Orleans Flood will depend highly onhow quickly authorities can respond to the event,”said Laurie Johnson, vice president of technicalmarketing at RMS. “The speed at which existingpumps are reactivated and additional pumping capacityis added will determine how rapidly the flood watersare removed. But this is only the first step in restoringservice to flooded areas of the city.”It was a week before the worst of the levee breakswere repaired and water from the New Orleansbasin was being pumped back into Lake Pontchartrain.Some experts said it might take as little as 24 days toget most of the water out of the basin. Others said80. Three weeks after the floods, rainfall accumulationhad been negligible but few areas of the city were

continued on p.2

Financial ombudsman receives more travel claimsEach year, about one in 20 policyholders make aclaim on their travel insurance following a tripabroad. Many of these will be straightforward claimsthat get paid in full, with the minimum fuss, but forsome, the process is more arduous. Ian Youngmanlooks into the rise of travel insurance claims in theUK

UK independent regulator, the Financial OmbudsmanService (FOS), reports that it is seeing a growingnumber of disputes about travel insurance, with 13per cent of the general claims being travel-related.

The FOS adjudicated on 1,525 claims relating to travelinsurance for the 12 months ending April 2005. Thiswas up five per cent from the previous year, which inturn was up 33 per cent on 2003.The small print and details regarding excesses, coverfor expensive items, travellers ‘duty of care’ and pre-existing medical conditions, are where disputes mostfrequently arise. In fact, disputes about the disclosureof pre-existing medical conditions are most common.The FOS also receives many complaints aboutinsurers refusing to pay out for stolen baggage that hasbeen left unattended.

A new trend is complaints where consumers take outan annual insurance policy to begin on the start date oftheir holiday, rather than from when they booked itand find if they have to cancel before their departuredate they are not covered.The FOS is not happy with the travel and travelinsurance industries. It believes more should be doneto explain travel insurance policies and to correctcommon misconceptions about their scope. Inparticular, the general expectation that travel policies

continued on p.6

The Big Agony

WHAT’S INTHIS ISSUE?

REGULARS

News 1Grapevine 5Editorial comment 7Insurance matters 7Company brief 10Health matters 12Travel matters 14News analysis: Will recent crashes spur insurance? 16Air ambulance news 21World markets: Taiwan 24Hot spots 28Dick’s hotline: Sponsored youth market 28Service directory 30Diary dates 34Smile corner 34On the move 35Contributors 35

FEATURES

Should travel insurance be compulsory? 22Liability claims 26Profile: Nicolas Keglevich 29

ITIJ TEAMEditor-in-chief: Ian CameronEditor: Sarah Lee

Editorial assistant: Leonie Bennett

Staff writer: Hannah Langfield

Designers: Eli ButlerChris Marke

US correspondent: Milan Korcok

India correspondent: Saby Ganguly

Legal correspondent: Dick Atkins

Conference manager: Denise Clements

Production: Adele Brown

Production assistant: Helen Watts

Advertising sales: Jude EdwardsDavid Fitzpatrick

Finance: Helen Parker

Cartoonist: Chris Duggan

FREE SUBSCRIPTIONS FORTRAVEL PROFESSIONALS

ITIJVoyageur Buildings 43 Colston StBristol BS1 5AXUK

editorial: +44 (0)117 922 6600 advertising: +44 (0)117 925 5151fax editoial: +44 (0)117 929 2023fax advertising: +44 (0)117 925 2040email: [email protected] web: www.itij.co.uk

ITIJITIJInternational Travel Insurance Journal

HURRICANE KATRINA NEWS2

International Travel Insurance Journal www.itij.co.uk

The Big Agony continued from p.1

cleared for returning residents or businesses. Polls ofevacuated residents also showed that approximately40 per cent had begun to settle in to othercommunities and said they did not intend to return toNew Orleans.On the Gulf Coast of Mississippi, in Gulfport andBiloxi, the devastation was just as complete – causedby wind as well as tidal surges. But tourism officialsand residents were more upbeat about the rebuildingprocess, saying they intended to stay.In addition to rebuilding, the costs of interruptedeconomic activity exceed $100 million per day: formany businesses a combination of incentives seriousenough to drive residents or businesses out of the city permanently.With 80 per cent of New Orleans under water atone point, rescue and recovery operations had totallyoverwhelmed local, state and federal emergencymanagement agencies, leaving hundreds of thousandsof flood victims sitting atop roofs or in airless attics andwithout food or water for several days in over 90°Ctemperatures.It was almost five days before the relief effortappeared to come to life and signsemerged that things would get betterand the looters and snipers who hadbeen terrorizing parts of the citybefore the National Guard moved inwould be curbed.Even President Bush criticized therelief efforts as 'inadequate' and 'tooslow' as he toured New Orleans andthe devastated Gulf Coastcommunities crippled by the storm.With the media keeping up a loudand persistent drum beat about floodvictims dying unaided in shelters,babies going without food or water,city residents forced to sit and wait,and wait, and wait, in the putrefyingstench of refugee centres, it was clearthat organisational heads would roll,and the first belonged to MichaelBrown, head of the Federal Emergency ManagementAgency charged with overseeing theKatrina rescue and reconstructionoperation. In the meantime, offers ofaid, in the form of cash and reliefgoods came flooding in from over 50nations worldwide, not all of thempolitically friendly to the US – acurious anomaly to Americans, usuallyon the giving, rarely on the receivingend of foreign aid. Even such archenemies as Iran, Syria and Cubaoffered aid. And while thousands of New Orleansresidents were rehabilitated toneighbouring states – some severalhundred miles away – others would

end up in an environment they never dreamed of:three Carnival cruise ships – the Ecstasy, Sensationand Holiday were chartered by the federalgovernment to house refugees for up to six months.The ships,capable ofhousing 7,000,will be docked inthe port ofGalveston, nearbyHouston, Texas.The trouble isthat manyevacuees slatedfor the cruiseships havedeclined theluxurious digssaying they don'twant to be leftindefinitely, awayfrom home.

Insurance threatenedby climate changeThe number and size of recent natural disasters canno longer be put down to ‘freak’ weather patternsor ‘one-offs’. With tsunamis and hurricanesbecoming more the norm, global warming is anissue that has to be faced up to. It is down togovernments to address the root of the problem, asthey will bear the brunt of insurance responsibilitywhen private premiums become so high and sospecialised that the general public are unable toafford it.Hurricane Katrina is our most brutal reminder andthis warning is extended not only to insuranceindustries, but also to companies, governments andthe general public alike. The escalating losses thatrecurring disasters lead to, have been subject to arecent report by the Ceres investor coalition.Studies reveal a 15-fold increase in insured lossesfrom catastrophic weather events in the past threedecades, a figure that out strips premium increases,inflation and even population growth for the same period.Although it is not possible to attribute any singledisaster to global warming, the report clearly statesthat future rising temperatures will inevitably play apart in significant increases in severe weatherconditions, such as floods, hailstorms, hurricanes,wildfires, droughts and heat waves. Weather-relatedlosses cannot be underestimated and climatechange looks set to magnify these figures over

the coming years, inboth personal and business aspects.Premiums withincreased limitations incoverage were alreadyrising prior toHurricane Katrina andthe report warns that,if insurance andclimate continue tofollow this pattern, theavailability andaffordability ofinsurance will be ateven greater risk for homeowners and businesses.

Katrina: wind or waterThe residents of the Gulf Coast, who believed thatnothing could be worse than losing their homes andlivelihood, are being met with yet more devastatingnews from their insurers, as the debate rages as towhether they have legitimate wind damage claims. Residents on the Mississippi Gulf Coast are findingout that some standard homeowner’s policies andhurricane policies do not cover damage from floods.“There are a large number of policies or claims thathave already been denied by the major carriers onthe grounds that the damage was almost exclusivelycaused by tidal surgerather than wind,”Lance Stevens,chairman of an ad hocinsurance committeeset up by theMississippi TrailLawyers Association,said.The question insurersare currently debatingis: How much of thedamage was theresult of strong windsand how much wasfrom flooding? Theanswer could meana difference ofbillions of dollars inliabilities for insurers.Risk ManagementSolutions’ estimatedcost of $40-60billion for insurersassumes a narrow definition of insurers liability. If theinsurers are liable under broader terms, includingwater damage, that estimate will rise considerably.With the Gulf Coast’s history of hurricanes, mostbusinesses and homeowners in the area haveinsurance that covers wind damage. However,although many businesses also bought floodinsurance, relatively few homeowners did.In New Orleans Parish, the US government

considered the levees protection enough andtherefore did not require homeowners to buy floodinsurance. As a result, only two in five householdsbought the coverage.Both Louisiana and Mississippi have so-called ‘valuedpolicy’ laws that could require carriers to pay fullreplacement value of property suffering total losseseven if part of the damage is caused by flooding.“Much of the damage in Louisiana will come fromflooding alone, so this could lessen the number ofsuits. But there will surely be enough total losses

where wind and floodingplayed arole to keepthe issuealive,” DonGriffin, vicepresident ofpersonal linesfor thePropertyCasualtyInsurersAssociation ofAmerica,noted. RobertHartwig,senior vicepresident andchief economistwith theInsuranceInformationInstitute in NewYork, speculated

that Katrina could produce a substantial amount oflitigation from those who are not happy with theirclaims settlement where the damage was primarilyfound to be caused by flooding and there was noflood insurance in place.Ed Pasterick, a senior advisor with the NationalFlood Insurance Program, noted that in July, only21,593 flood insurance policies had been written in

the three Coast counties. Hegloomily said that those withoutflood insurance can, at best,hope for a low-interest loanfrom the Small BusinessAdministration to help rebuild.“I think most people are goingto be surprised that theirhurricane insurance does notcover the water damage,”added Vicki Slater, a Jacksonattorney working with the triallawyers’ insurance committee.“It’s almost like buying a fireinsurance policy that doesn’tprotect against damage fromsmoke or heat. Well, that’s notfire insurance at all.”It is a potential area of disputethat will, no doubt, get moreheated over the followingmonths.

Costs surpass allother hurricanesOn the morning of 29 August a hurricane sweptthrough the Gulf of Mexico with winds in excess of100mph, leaving behind a trail of devastation in itswake. Initial estimates of the damage created werequickly reassessed with the news that New Orleans’levees had given way causing catastrophic floods.Hurricane Katrina stands to represent the largestinsured loss in US history, surpassing all others,including Hurricane Andrew, which hit Florida in 1992and the combined impact of the four hurricanes of2004. Questioning has been rife as to whetherinsurance companies will be able to carry such aburden and pay up quickly without a wide-scale knockon effect, as the clean-up estimates are as high as $50billion. The estimates for insured losses keeps onrising from an initial modest $14 billion to $35 billion.A loss of such magnitude has the potential to stress orlead to the bankruptcy of insurers, with the smallercompanies being most vulnerable. Exact losses arevery hard to predict during the early stages of disaster,and it will take a long time to refine losses anddetermine who is most at risk of financial distress.StateFarm registered 150,000 claims within thesecond week after the storm. Even if insolvencies areavoided, companies may still face downgrades.What of future premium costs? Will homeowners andcar owners see a rise in premiums? If history is anyindicator, insurance premiums will climb and, contraryto some predictions, will have a knock on effect forthose outside of the stricken area.Fortunately, insurers are in a better position that theywere when Hurricane Andrew struck, with $400billion in capital available, so regulators are optimisticthat the predicted absorption of losses will besustained.Despite this, the Allstate chairman and chief executiveEdward Liddy has revealed that initial risks for NewOrleans were underestimated, which means futurepremiums may be set at a higher level. However,nationwide price increases will prompt a reactionfrom consumer groups and regulators alike, focusingon the fact the industry managed to register a profitlast year, despite the barrage of hurricanes that hit andthe falling homeowners rates in areas outside ofFlorida.Exact sums have been hard to predict due to thesheer magnitude of the disaster, the ongoingconsequences and the inability to get to the scene of

devastation straight after ithappened. Unlike other flooddamage, the waters did notsweep into the buildings andthen drain away, but remainedthere turning stagnant andmixing with other pollutantssuch as oil and refuse.Consequently, buildings mayhave to be completely rebuilt.Commercial or automobileinsurance, unlike homeinsurance, does cover forflood damage, meaning theimplication for auto insuranceis not a good one. With manycars submerged, motorinsurers will, in many cases,

have to face claims for the full the cost of the vehicle.A number of factors have been raised with regards tothe validity of claims. For example, the majority ofhousehold insurance doesn’t cover for flooding, asstandard homeowners’ insurance covers damage onlyfrom fire and wind. A typical homeowner’s insurancepolicy in the New Orleans area would cost about$600 to $700 a year, with the additional floodcoverage adding a good $300 per year. The twomajor insurance issues to be addressed are thehurricane effect on coastal areas – wind and coastalsurge damage – and the flooding in New Orleans.Fifty per cent of the total economic loss is expected tocome from the flooding. Of the $40–$60 billiondollars cited, $15-$25 billion will be a direct result ofthe New Orleans flood. In total, economic losses areexpected to exceed $125 billion.It is not yet known how much impact this will have onthose parts of the country not stricken by the disasterand also on the rest of the world.

Profiteers cash in onHurricane Katrina

Some people will stop at nothing. Hurricane Katrinahad barely blown itself out when the backlash ofjokes and ridicule began, with profiteers popping upall over the place.The Internet – the main provider of such activities –played host to those trying to make a quick buck.Jars of ‘authentic’ rainwater, a ‘rain-soaked’newspaper and a message in a bottle, whichapparently led to the rescuing of several families, areamong some of the items placed on eBay.Further scams include a Texan ‘artist’ selling ascribbled piece of artwork that looks uncannily likesatellite pictures of Katrina, which he claims to havedrawn after waking from a dream prior to thestorm. Another man is offering up his story ofsurvival for a mere $12,500! Slogan t-shirts arealready doing the rounds, stating ‘I survivedHurricane Katrina’ or, for those with less moralconscience, ‘I went to New Orleans and all I lootedwas this lousy T-shirt’.

Insurance reliefefforts gather paceInternal relief efforts may have been criticised bymany, but ultimately insurers in the US havegrouped together to create funds to alleviate someof the burden that Hurricane Katrina has cast uponthe nation. This solidarity has been reinforced by aninternational show of support, including supportfrom some surprising sources, such as an offer ofships and aircraft from the French to a US$25,000($33,000) donation by tsunami-pounded Sri Lanka.Venezuela and old US foe Cuba are two morecountries to have offered aid.In what is perhaps a vital move, insurers aresuspending policy cancellations for non-paymentand are holding off on non-renewals of personaland commercial insurance policies in areas mostseverely affected by the flood.The National Association of Mutual InsuranceCompanies (NAMIC) has established a relief fundwith contributions going directly to the AmericanRed Cross, the first contribution from staff totalling$1,265.“If every NAMIC member company contributes asimilar amount, the MIR effort will raise $1.5million,” stated Chuck Chamness, NAMICpresident.Chubb are another corporation that has set up afund, donating $500,000 directly to disaster relieforganisations. In addition, it has offered to matchemployee contributions on a two-for-one-basis, upto $500,000 and, if employee donations total morethan $500,000, Chubb will then match the moneyon a one-for-one basis.Other insurance companies have taken it uponthemselves to look after their own. The NationalAssociation of Professional Insurance Agents (PIA)has issued a call to members to offer temporaryhousing assistance to independent agents in theareas damaged by Hurricane Katrina. Elsewhere,the Independent Insurance Agents and Brokers ofAmerica (IIABA) has established the Big ‘I’ KatrinaRelief Fund, with all donations assisting insuranceindustry colleagues.


HURRICANE KATRINA NEWS4

As the residents of New Orleans began to return to their city,another hurricane, Hurricane Rita, is increasing in intensity.After lashing the Florida Keys, Hurricane Rita was upgraded toa Category three storm, on 21 September, with 115 miles perhour winds. Forecasters have said it appears to be strengthening tocategory four, with winds above 130 miles per hour, the sameas Katrina, sparking an order for mandatory evacuations inNew Orleans and Galveston, Texas. Federal officials have toldGulf Coast residents to begin bracing for a blockbuster storm.“Up and down the coastline, people are now preparing forwhat is anticipated to be another significant storm,” PresidentBush said. Reports also suggest there is a possibility of Ritahitting Louisiana or northern Mexico.Acting FEMA director David Paulison has told Gulf Coastresidents to pay attention to the storm. The hurricane seasonruns until the end of November.

Stop press… stop press…

www.itij.co.uk International Travel Insurance Journal

NEWS 5

GRAPEVINE•GRAPEVINE•GRAPEVINE•GRAPEVINE•GRAPEVINE•GRAPEVINE•GRAPEVINE•G

RAPEV

INE•G

RAPEVINE

•GRA

PEVINE

•GRA

PEVINE

•GRA

PEVINE

•GRAPEV

INE•G

RAPEV

INE•G

RAPEV

INE•G

RAPEVINE

•GRA

PEVINE

•GRA

PEVINE

•GRA

PEVINE

•GRAP

EVINE•GRAPEVINE•GRAPEVINE•GRAPEVINE•GRAPEVINE•GRAPEVINE•GRAPEVINE•GRAPE

VIN

E•G

RAPE

VIN

E•G

RAPE

VIN

E•G

RAPE

VIN

E•G

RAPE

VIN

E•G

RAPE

VIN

E•G

RAPE

VIN

E•G

RAPE

VIN

E•G

RAPE

VIN

E•G

RAPE

VIN

E•G

RAPE

VIN

E•G

RAPE

VIN

E•G

RAPE

VIN GGRRAAPPEEVVIINNEE $3 million won –

all in pennies

Shigeko Ide Stein, 61, is a lucky gambler indeed.After popping penny coins into the TwilightZone Video Slots in a casino in Nevada, sheclocked up a whopping $2,955,070.83.According to the makers of the one cent slotmachines, or one-armed bandits as they arecommonly referred to, she also scored herself aworld record in the process. Mrs Stein is aregular visitor to the slots and said of her win: “Ijust had a good feeling after seeing a woman hada winning combination but didn’t have a maxcoin bet.”

Castrating ironsstolenTop visitor attraction, The London Dungeon,has released an urgent appeal for the safe return

of its castrating irons,which were stolenfrom its torturechamber. The torturechamber is one of themost popular showsin the Dungeon andconsists of actorspulling volunteersout of the audienceto demonstrate howthe instrumentswork. The castratingirons are an integralpart of thedemonstration andare particularlypopular amongst thefemale members ofthe audience,

especially when they are informed they areavailable in small, medium and liar size!

Naming andshaming airlinesIn a bid to improve Europe’s airline’s safety, theEuropean Commission (EC) has announced that itintends to ‘name and shame’ airlines that fail tomeet basic safety requirements.Following the crashes of Cyprus’s Helios Airwaysthat killed all 121 passengers and West CaribbeanAirways that killed all 160 passengers in Venezuela,the EC proposes to open a public website forpassengers and for more information sharing by

European airsafetyauthorities. The EUtransportcommissioner,JacquesBarrot, saidthat the‘terriblecatastrophe’ inVenezuelashowed thatan airlinesblacklist wasnow vital. It isanticipatedthat such a list

will be modelled on the blacklists used in the US bythe Federal Aviation Authority. The blacklist willinclude airlines or aircraft that have been eitherbanned or restricted in any of the EU’s 25countries. The commission’s proposal, which would affectboth standard and charter flights, is expected to saythat passengers need to be told when one airline isswitched for another, for any reason, betweentravellers booking and flying. If there is a safetyproblem, passengers may benefit from a cut-off date– probably seven days – to cancel their reservation,at no additional cost. The proposal is also likely togrant passengers the right to demand an alternativeflight operated by a carrier considered safe if theairline change is made after the journey has alreadybegun; for example, for the return leg. If that is notpossible, compensation may be paid.It has been suggested that the European AviationSafety Agency (EASA) will take responsibility foroverseeing much of the safety certification, which iscurrently split between national and Europeanbodies. “Although the standards of aviation safety arevery high in Europe, the responsibility for oversightis still divided,” said Daniel Holtgen, a spokespersonfor the EASA. A uniformed body will hopefully makeenforcing regulations easier.Problems of EU co-ordination were seen when theDutch, German and French authorities bannedTurkish airline Onur Air from their airspace, afterproblems occurred during ramp safety checks.However, other European governments failed tofollow, and accepted the airline. With theintroduction of the blacklist, such incidents shouldnot arise.

Young travellersreceive warningNew research shows that young tourists are mostat risk of suffering accidents abroad than oldertravellers. However, almost 1.5 million peopleunder 30 still holiday abroad without taking outtravel insurance.A poll by Sainsbury’s Bank discovered that 31 percent of 15–24 year olds and a quarter of 25–34year olds have suffered from a problem, such asfalling ill or losing money, while on holiday abroad inthe past five years.According to Mintelresearch conducted lastOctober, one in fivepeople aged 18–24 whotook a holiday last yeardid not take out travelinsurance. Thecorresponding figure for45–64-year-olds was justsix per cent.Robert O’May, the bank’stravel insurance manager,said: “Our researchshows that young peopletend to be at greater riskof suffering misfortune onholiday than olderpeople, which makes it more important that theyhave travel insurance. Without it they could findthemselves with no assistance and potentially veryexpensive medical bills. Despite this, they are farless likely to take out cover.”Holidaymakers are advised to make sure theychoose a policy that provides a wide range of coverand benefits, while always taking time to read thesmall print.

US issues newtravel advisoryThe US has issued more terrorist warnings. In arecent statement the US State Department hasupdated the worldwide caution on terrorism,warning Americans about the threat of extremistviolence against US citizens and interests abroad. The warning, cited as ‘current information’ indicatedthat al-Qaeda and affiliated terrorist groups areplanning attacks against US interests in multipleregions, including Europe, Asia, Africa and theMiddle East. No single countries were specified. This latest alert supersedes that issued in March,which said attacks against private and official targetscould come in the form of assassinations,kidnappings, hijackings or bombings. “US citizens arestrongly encouraged to maintain a high level ofvigilance, be aware of local events and take theappropriated steps to bolster their personalsecurity,” the statement said.

Billions spent onunused gadgetsOnline home insurance firm, esure.com, hasreported that Britons spend billions onhousehold gadgets that they never, or rarely, use.The survey estimates that Britons havecollectively spent £9.4 billion on gadgets such assandwich toasters, currency converters andbathroom scales. Top of the list is the sandwichtoaster, with 45 per cent of those polled notusing them, amounting to a total wastedspending of £21.51 million pounds.

World’s stongestbeerIn line with the German beer tradition, aGerman brewer from southern Germanyhas come up with the latest tourist trap –a beer with an alcohol content of 25.4 percent! Brewer Harald Schneider has comeup with a concoction that is so potent, itis served in a shot glass. “Everyone whohas tried it is enthusiastic. It tastes like aquirky mixture of beer and sherry,” saidthe Bavarian brewer. Claimed to be theworld’s strongest beer it is fermented for12 weeks to achieve an alcohol contenttwice that of Germany’s other strongestbeers. Tourists travelling to Germany aretold to beware and check their insurancepolicies before sampling the brew: “Peoplewill only be able to drink two or three glasses,otherwise they’ll drop like flies,” said Schneider.

Japan heads onesecond into futureWell known for their business acumen andfastidiousness, Japan has emanated this trait byannouncing a move in its clocks. Wanting to beas punctual as possible, they will move all clocksahead – by one second! This one-second moveinto the future will take effect as of 1 January2006, when they adjust the high-precisionatomic clock, which keeps Japan Standard Timeusing advanced physics. Japan is not used toadjusting clocks, being the only majorindustrialised nation that does not practicedaylight savings.


NEWS6

Indonesia increases number of VOAsThe Indonesian Ministry of Culture and Tourism hasobtained the approval fromthe government for 11 morecountries to receive thefacility of visa-on-arrival(VOA).“The policy is aimed atattracting foreign tourists tovisit Indonesia. We have seta target of bringing in morethan six million foreigntourists this year,” minister ofculture and tourism, JeroWacik, said. The government hasdecided to allow thenationals of 11 countries inAsia, Europe and the MiddleEast to obtain VOAs in aneffort to attract more touriststo the country: Saudi Arabia,Kuwait, Belgium, Spain,

Portugal, Russia, Egypt, Austria, Ireland, Qatar andLuxembourg. It is hopedthe Netherlands andSweden will be added tothe list shortly. Twenty-one countries arealready able to takeopportunity of thisscheme: Argentina,Australia, Brazil, Canada,Denmark, Finland,France, Germany,Hungary, Italy, Japan,New Zealand, Norway,Poland, South Africa,Republic of Korea,Switzerland, Taiwan,United Arab Emirates,UK and US. The VOA isvalid for either six or 30days, and costs US$10and US$25 respectively.

Disabled travellers market could beimprovedThough Americans with disabilities are travelling inrecord numbers, spending almost $14 billionannually on business and leisure travel, mostcontinue to face substantial obstacles, particularlywhen dealing with airlines and airports, says anew report. Milan Korcok investigates

Based on a poll conducted by Harris Interactive, thereport, released by the Open Doors Organization(ODO) in co-operation with the Travel IndustryAssociation of America, concludes that revenuesfrom the disabled travellers market “could easilydouble if certain needs were met and obstaclesremoved.”“This new data,”says ODO directorEric Lipp, “confirmswhat we alreadyknew, that there isa strong disabilitytravel market. Inthe past two yearsalone, more than21 million adultswith disabilitiestravelled forpleasure and/orbusiness.”However, amongthose adults withdisabilities whohave travelled byair, 84 per cent said they encountered obstacleswhen interfacing with airlines and 82 per cent saidthey encountered obstacles at airports. In addition, 60 per cent of travellers with disabilitieswho have stayed overnight in paid accommodationssaid they had problems at these properties – 48 percent with physical barriers, 45 per cent with

customer service, and 15 per cent withcommunications barriers. “On the positive side,”says Lipp, “many of the most common complaintsidentified by the study, such as heavy doors and lackof knowledge among staff, could be easy andinexpensive to resolve.” The study also reports that 71 per cent of adultswith disabilities dine out at least once a week – a sixper cent increase since 2002. In encouraging suchtrade, one restaurant chain, cited by ODO, isoffering Braille/large print menus, improvedcustomer service for the disabled, and largerpathways between tables.

Disabled travellers also claimed that of the 20 percent who rented cars for travel in the past twoyears, half would be more inclined to rent a car if itwere delivered to them and picked up oncompletion of their trip, while 36 per cent said theywould be willing to pay more for this service.

Financial ombudsman receives moretravel claims continued from p.1

cover almost every eventuality that can occur on aholiday, which is clearly not the case, is a bugbear ofthe FOS’s.Another concern is that customers are unawarethat standard exclusions, where policies are sold aspart of a package deal by tour operators, will notcover many adventure activities – such as scubadiving, jet-skiing or bungee jumping.One clause that brings the industry bad publicity iswhere insurers can refuse to pay out if injuries aresustained or items stolen while the policyholder is

found to be under the influence of alcohol orillegal drugs.The FOS sees a wide range of disputes abouttravel insurance issues – often relating to theclarity of the wording of policies.The Financial Services Authority’s (FSA) new rules for insurers, which came into force in January 2005, should help reduce the number ofthese complaints. The rules require policysummaries and wordings that are clear, fair andnot misleading.

Editorialcomment

With Hurricane Katrina having taken its tollon New Orleans and the Gulf Coast,insurers are assessing the damage andcalculating the cost to the industry. Believedto be the most expensive storm-relatedevent ever for insurers, we ask what effectclimate change may have on future weathersystems, and look at what effect this couldhave on insurance premiums. We alsoreflect on the relief effort following Katrinaand investigate how insurers will managetheir losses. Elsewhere in this issue, the naming andshaming of airlines around the world that failto meet safety standards is a hot topic inEurope. The EC is drawing up an airlineblacklist that it is expected will be modelledon such lists currently available from theUS’s Federal Aviation Authority. And in our‘News analysis’ section, we ask whether thespate of recent tragic plane crashes will affectairline and even travel insurance. The issue of compulsory travel insurance is,not surprisingly in such times of tumultuary,raised yet again, and it is to this subject wedirect our attention in one of our featuresthis month. In the first of a two-part series,we look at how an older, and less healthy,travelling population is an increasing worryfor airlines. A higher risk of medicaldiversions and the great financial burdenassociated with such eventualities is a realconcern and a situation that naturally raisesthe question of mandatory insurance coverfor air passengers. In this issue, we also explore the burgeoningChinese market and analyse theopportunities in the country for insurers.And we have the second-part in ourexamination of public liability, looking at howinsurers can minimise their costs. As thefeature pertains, knowledge is key; and ifknowledge means a more streamlinedclaims process, with fewer costs involved,now that’s got to be worth learning about.

Sarah LeeEditor

Finite reinsurance isfound ‘rational’Regulators around the world fear that finitereinsurance could be used to manipulate companies’figures. Finite reinsurance is the result of the necessityfor the insurance industry to allow the provision oflong-term reserves without being held to ransom bythe taxman. Finite reinsurance is not illegal, but thereis speculation that it is not accounted for properly. It iscurrently at the heart of regulatory inquiries intopotential accounting inaccuracies at AmericanInternational Group, the world’s biggest insurer.According to the Centre for the Study of FinancialInnovation (CFSI), finite reinsurance is a “rationalresponse to the irrational exigencies of an accountingand regulatory system that steadfastly refuses toacknowledge the ‘specialness’ of insurance.” They goon to say that whilst the system refuses to encouragethe retention of long-term reserves against long-termliabilities, finite reinsurance will remain a prevalent andpermanent factor within the industry.

Japan earthquakeno threat to insurers

Standards andPoor’s RatingServices (S&P)has analysed theimpact of therecentearthquake inJapan, which

occurred less than 200 miles North of Tokyo.According to the ratings agency, the double impactof insurance payouts and share price losses will notinhibit insurance companies’ ability to pay claims, but could negatively impact insurers’credit quality. The reserves of the affected Japanese non-lifeinsurance companies are sufficient to cover claims,but the devaluing effect upon their equity portfolioscould risk destabilising the companies’ capital. Withtheir large domestic equity portfolios, the biggestconcern for insurers would be falling domestic shareprices. Such an occurrence would leave their capitalbases highly vulnerable to stock fluctuations. Payouts in the event of a major earthquake havebeen calculated by S&P as costing as much as 6.6trillion Yen (around $60 billion), and even after therecovery of reinsurance claims, losses would still bemore than one trillion Yen ($10.9 billion). In theevent of a fall in domestic share prices following alarge earthquake, the revaluation losses would befar worse than direct payouts on claims.Thus, as S&P points out from a catastrophe riskmanagement standpoint, “it is crucial for non-lifeinsurance companies to continue reducing their shareholdings.”


INSURANCEMATTERS 7

AIG sued over‘inflated’ claimsAmerican International Group and its frontingcompany Trenwick America ReinsuranceCorporation (now bankrupt) are being sued by agroup of 18 insurers who claim they schemed tocollect as much as $73 million in ‘grossly inflated’workers compensation and other reinsuranceclaims. According to the faculty of insurers, only $15 million

of the $73million that AIGhas claimed forare legitimatepaid losseseligible forreinsurancecoverage. Theremainingamount theyallege as ‘highlysuspect’estimates offuture losses(incurred but notreported).

AIG strongly denies any wrongdoing, includingallegations of fraud. According to the plaintiffinsurers, AIG’s claims figures defied actuarial senseand were highly suspicious. The companies go onto say that they, “never provided satisfactory proofof explanations. Instead AIG and Trenwick togetherengaged in a pattern of evasive and obstructionistconduct.” No payments have yet been made to AIG, due toclaim charges by the reinsurers of fraud, civilconspiracy and aiding a breach of fiduciary duty.Unfair and deceptive damages have also been citedin the request for compensatory and punitivedamages and an injunction of all payments of theAIG claims.

FSA going soft onscaremongers?Consumer groups in the UK are not pleased withthe latest course of action, or rather inaction, fromthe Financial Services Authority (FSA), at a timewhen the insurance industry is under scrutiny for itsproliferate use of scare tactics. The FSA’s rebuking ofsuch tactics has been perceived as ineffectual, andwas highlighted when dealing with firms failing tocomply with regulations for insurance promotions tosell critical illness policies. The criticism arose when theFSA announced it wasrestricting its action to writingto the firms that had breachedits regulations, rather thanintroducing fines, following aninvestigation of 25 firms’ useof leaflets and advertisingmaterial for critical illnesspolicies. The FSA defendedsuch a move saying that fewerthan half the firms reviewedwere found to be non-compliant, saying: “If theseissues persist, thenenforcement will become an option.” Critical illness was focused upon, due to its complexterms and high-risk considerations. The vulnerabilityof customers also creates a more fragile situation.The FSA said that some of the scaremongeringtactics used in the promotions included the use ofstatistics, such as ‘100,000 cases of cancer eachyear’, when not all forms of the disease werecovered by the policy. Unsubstantiated claims wereanother tactic, as well as the lack of prominencegiven to key conditions and costs excluded onpolicies. These issues were highlighted, largely dueto the high volume of complaints registered bythose who have been denied claims. Consumer groups are outraged that the regulatordid not take a tougher stance. “These firms areclearly non-compliant, yet they are not pursuingaction and making an example of them,” saidLawrence Baxter, senior policy officer withconsumer group Which?

tandard & Poor’s Rating Services has placed itsratings on 10 interactively rated insurance and

reinsurance groups on CreditWatch, with negativeimplications, due to their possible exposure to thecatastrophic and unparallel losses stemming fromHurricane Katrina: ACE group, Lloyd’s, Oil Casualty,Montpelier Re, PXRE, Swiss Re, United Fire Group,Allmerica, Allstate, State Farm and their respectivesubsidiaries.

loyd’s insurer, Amlin, expects its first-half pre-tax profit to be not less than £120 million

compared with analysts’ forecasts of £73 million to£91.2 million.

IG has reported net income for Q2 of $3.9billion, compared to $2.65 billion in Q2 2004 –

a 51 per cent increase. First half net income jumped47.4 per cent to $7.68 billion.

tlantic American Corp. announced net income of$1.2 million for Q2, compared to net income of

$1.1 million the same time last year. Hilton Howell,president and CEO, said that the improved income isdue to the substantial amount of time spent reassessingtheir property and casualty book of business.

nsurance Australia Group Ltd announced a secondhalf drop in profits of 13 per cent to AU$314

compared to the same period in 2004. However, netprofit after tax was AU$760 million for the fiscal yearended 30 June 2005 – a 14.3 per cent increase overlast year.

umours abound that China’s Bank ofCommunications Ltd (BC) is planning to form a

partnership to enter the property and casualty business.Reports notes that discussions with potential mainlandChinese partners are well advanced and that thecompany may soon submit a licence application to theChina Insurance Regulatory Commission.

nsurance giants, Aon and Willis, have been cuttingexpenses, wooing new business and raising

commissions in able to reduce their dependency onbonus (so-called contingent) commissions, accordingto a report by Standard & Poor’s. The report notesthat, in a positive turn of events, with the changes, thecompanies seem to be poised to prosper, despite losingthe contingent commissions, which accounted for alarge proportion of their revenues.

he largest of the UK-listed Lloyd’s insurers, Brit,has promised that its first-half pre-tax profit

would be ahead of expectations at around £110million. Brit has said that it has benefited from abetter investment performance, food marketconditions and an absence of large claims.

urich has reported a record operatingperformance for the first half of 2005 – net

income increased 21 per cent from last year to$1,799 million. A.M. Best says the company’s ratingsremain unchanged.

ortis has posted a €684 million net profit beforeresults on divestments for its insurance business

for the first half of 2005. Gross written premiums forNon-life were up two per cent to €2,688 million. Non-life combined ratio improved from 98 to 94 per cent.

rance-based Scor group has obtained permissionfrom the Indian regulatory authority to open an

office in Mumbai, India, with a view to strengtheningand developing its activities in the non-life reinsurancefield. The hope is that its written premiums on theIndian market will rise by 20 per cent from 2005. Thecompany already has seven subsidiaries andrepresentative offices in the Asia-Pacific and Indiansubcontinent: In Singapore, Hong Kong, Tokyo, Seoul,Sydney, Labuan (Malaysia) and Beijing. Scor has alsoseen its first half earnings rise by 18 per cent from lastyear to €72.2 million.

ld Mutual has made a bid for Sweden’s largestinsurer, Skandia. The £3.3 billion bid comes

after weeks of speculation. The bid is subject toSkandia’s board accepting the offer by 23 September.

S

L

I

A

T

A

NEWSWIRE

F

F

Z


INSURANCEMATTERS8

I

R

O

Determining businessinterruption coverageA big insurance question to arise after thedestruction of the World Trade Centre on 11September, and in light of the recent happenings inNew Orleans, is business interruption coverage. Ithas proven very difficult to determine when theinsurer has satisfied its obligation of businessinterruption coverage.An example given recently is that of Duane Reade,Inc v. St. Paul Fire and Marine Insurance Co. DuaneReade owns and operates more than 200drugstores in and around New York City and priorto the destruction of the Twin Towers, the singlemost profitable store occupied lease premises onthe main concourse of the World Trade Centre. Atthe time of the disaster, Duane Reade was insuredunder a $150 million property insurance written bySt Paul. Following the destruction of the WorldTrade Centre, St Paul adjusted Duane Reade’s claimin an attempt to indemnify it for his propertydamage and business interruption losses. Thus,following its theory of how to adjust the losses, StPaul paid $9.8 million to cover nine months of lostprofits in order to ‘locate, furnish and open a newdrugstore’. They also paid an additional 12 monthsof profits to compensate for the lowered profitsDuane Reade was likely to receive when its storereopened.Duane Reade, however had his own views when itcame to the operation of its business interruptioncoverage and filed a declaratory judgment action.Fundamentally he sought a judgement that itsrecovery for business interruption losses caused bythe store’s destruction should continue until theentire World Trade Centre complex was rebuilt.In response to this, St Paul maintained that thebusiness interruption coverage was properlyterminated 21 months after 11 September and thatduring this time Duane Reade would be capable ofrelocating its store to a new location and resumingoperations. Both views however were rejected bythe District Court, whose judgement in turn, wasquestioned by the Second Circuit of Appeals.Highlighted as the principle focus of opinion was thepolicy’s Restoration Period Clause. This could notbe reconciled with the Extended Recovery Period.Finally the Second Circuit held that St Paul was notobligated to provide business interruption coverageuntil Duane Reade could restore operations at astore located at its former World Trade Centrelocation. Instead the court ruled that the coveragewould only extend for the hypothetical time itwould reasonably take Duane Reade to repair,rebuild, or replace its World Trade Centre store at asuitable location.As demonstrated, claims for business interruptioncoverage can quickly become areas of disputebetween policyholders and insurers. It may bedifficult for a policyholder to maintain that the partieshad agreed a policy’s business interruptioncoverage, which would continue until the businessentity could be re-opened at its former location,regardless of how long that may take.Retrospectively, policyholders and insurers need tocreate policies that are tailored and priced toprovide for such specific terms, if the policyholder isintent on needing such coverage.

21st centuryinsurance visionFraud makes up 10 per cent of all insurance claims,with insurance companies able to uncover only 0.5 –one per cent. New technological developments areseeking to resolve three of the biggest problems ininsurance, of which fraud is one. Customer service is

another issue that needs resolving, as is thecost of handling claims.It is all part of the increasing competitionbetween insurance companies and the desireto become more profitable. The first initiativeis targeted at improving claim-handlingefficiency. It is hoped that by settling 50-80per cent of claims during initial telephonecalls, expensive follow-up calls and thegathering of additional information can be cutdown. A self-service customer initiativehopes to reduce claim costs by havinginsured’s file their own claims via the Internetenabling them to be handled instantly, oftenwithout even having to make human contact.An improved service level is also a commongoal amongst insurers, with competitionbeing so tight, small details such as directmail, call centres on hand, and quickresponse times to claim notifications enablescompanies to distinguish themselves against others thus acquiring and retainingmore customers.In the past the detection of fraud was not

such a concern, as premiums would simply be bumpedup to cover for it. Today however, increased pressurefrom government and a growing disapproval amongthe public, who do not see why the majority shouldpay for the crime of a few, is changing this trend.Moreover the less fraud that carries on, the morecompetitive premiums can become.Technology is certainly a factor coming to the rescue aspredictive software can help insurance companiesuncover two to three times as many instances of fraud.

Allianz seescontinued growthGrowth in Central and Eastern Europe continues tobe an important focus for Allianz, the Germaninsurer. In the first half of 2005, premium incomestood at €1.355 billion – an increase of 17 per centon 2004.“We’re verypleased thatwe’ve been ableto furtherimprove ouralready strongposition. What’smore important,however, is thatwe managed tofurther increasethe profitability ofour activities,”says WernerZedelius, themember of theBoard ofManagement ofAllianzresponsible forGrowth Markets. The Central andEastern Europeregion accountedfor €135 million of Allianz's mid-year, after-tax,profits of almost €2.6 billion. This corresponds to areturn on equity of 36 per cent. Property insurancecontinues to be Allianz’s biggest market segmentwith premiums of around €1.2 billion and growth ofaround 16 per cent.The company also experienced a strong growth inthe life sector, with premiums increasing by around22 per cent. The segment contributedapproximately €80 million to premium income.

urich has sold 100 per cent of the share capitalof Claims Management Group Limited (CMGL)

to Sovereign Capital Partners LLP and themanagement of CMGL. CMGL will continue tomanage insurance and reinsurance portfolios on behalfof Zurich.

.M. Best has affirmed the financial strengthrating of A- (Excellent) of New Zealand’s Credit

& General Insurance Limited (CGIL) with a stableoutlook. The rating is said to reflect the company’sexcellent and consistent underwriting and operatingperformance.

XA have reported a first-half net profit of 31 percent, thanks to the solid performance of its life

insurance and savings business. Net profit rose at theFrench insurer rose to €2.27 billion in the six monthsended 30 June from €1.73 billion a year earlier. Earningsfrom life and savings increased 19 per cent to €972million (thanks to growth in France and US), whilst theunderlying earnings for the property and casualtybusiness increased 21 per cent to €695 million.

lthough AXA gave no details on the likely falloutfrom Hurricane Katrina in the US, chief

executive Henri de Castries has informed investorsthat it will not hurt the insurer’s full-year earnings andthey still believe they are on track to deliver strongdouble-digit earnings growth for the full year 2005.

he four airline crashes that have hit Canada, Italy,Venezuela and Greece this month have resulted in

Aon experiencing their worst August in terms of airlinelosses for more than three years. The insured hull valuewas more than $170 million, but despite the highmonetary crash, Aon have reported that the number oflosses still falls within the average number of major airlinecrashes over the last three years.

eneral Re’s accounting for finite reinsurance hasbeen questioned by the Securities and

Exchange Commission (SEC). Berkshire Hathawaygroup subsidiary’s quarterly filings reportsgovernmental enquiries concerning the accounting forassumed and ceded finite reinsurance transactions,with further information requested for the UKbusinesses transactions.

erkshire’s investment group lost nearly $1 billionon the foreign exchange markets this year as a

long-term bet against the dollar turned sour. Therewas also a second quarter net income rise of 13 percent to $1.45 billion, or $941 per Class A share from$1.28 billion, or $834 a share, a year earlier. Revenueclimbed by one per cent to $18.13 billion, in spite ofa two per cent decline in insurance-related revenues.

Z

A

NEWSWIRE

A

T

A

G

B


INSURANCEMATTERS 9

Insurance firmsdevelop checklistIn order to recognise suspicious activity, someinsurance companies have developed a checklist ofred flags for compliance staff members to refer towhen monitoring transactions related to policies or contracts. Although many countries, including the UK andAustralia, already require insurers to reportsuspicious activity, the European Union (EU) hasadopted a directive on money laundering andterrorist financing. The amendment requires all EU member states to enact regulations requiring life insurance companies and intermediaries, among other financial institutions, to reportsuspicious transactions to their respective financialintelligence units. Obligations on behalf of US insurance companies tomaintain anti-money laundering programmes andfile any suspicious activity have not yet been finallyregulated. Despite this, many US insurers havetaken it upon themselves to take steps to complywith pending regulations.

Terrorism lifeinsurance poolIn one of many makeshift approaches to theviolence in Iraq, local providers have pooled theirpremiums together in a bid to cover what foreignfirms will not. Traditional life insurance policiesavailable in Iraq do not cover deaths from carbombings, ambushes, suicide attacks and the like. Foreign companies, from where most of the Iraqiinsurance companies resell policies, are not willingto include coverage for terrorist attacks because ofthe frequent violence. As one Iraqi said: “Life here isso random that you never can know if you will bekilled when you’re walking down the street ortalking on the phone, solely because of the luck.”

ABI aims to regain public confidenceInsurance providers have been having a harder timeof late, due to instability and poor public perception.The recent combination of falling stock marketsbetween 2000 and 2003, coupled with low bondyields, has caused insurers liabilities to rise and theirassets to fall. Add to this the recent loss of trustwithin the industry due to scandals of mis-selling andit is possible to see how not everything is runningsmoothly for the insurance industry.Stephen Haddrill, the new director general of theAssociation of British Insurers (ABI), is overseeingthe implementation of measures unveiled in Marchthat are intended to restore confidence to theindustry. “If anything irritates me, it’s the difficulty ofgetting over the message about what benefits theinsurance industry is bringing to society and to theeconomy,” he said.With so much cynicism around the ABI took it upon

themselves to come up with a way to turn thetrend around. They have set up a programme thatwill see life assurers being ranked in terms of theservice they provide to customers as well as linkingup with the Financial Services Industry (FSA) tomonitor how products are designed and promoted.Haddrill added that the ABI is also attempting totake on board more of the opinions of consumergroups by communicating with them through theFSA forums. There are also plans to revise theraising standards schemes. Recent proposals forpension reform on behalf of the ABI are an attemptto encourage private saving through the workplace.Denying allegations that insurers have failed topromote saving independently the ABI are in favourof all employees being automatically enrolled in

continued on p.34 continued on p.34


COMPANYBRIEF10

Travel insurance forJordan clientsIn an effort to promote further use of its paymentcards, Jordan Commercial Bank (JCB) has launchedits travel insurance policy. This free-of-chargeinsurance covers all countries except the country ofresidence and is a health-and-life insurance policywith cover up to $100,000.Cover includes death, severe injury, emergencymedication and treatment of bills. The move is anattempt to encourage cardholders to purchasetravel expenses with JCB’s card and to enhancetheir status in the local market.

Gap year insurancein demandGap year travellers are on the increase, but are theleast likely group to take out insurance. A laxattitude, coupled with their youth, also makes them

more likely to run intodifficulties when in a foreigncountry.PJ Hayman & Co are urging formore care to be taken by thesetravellers so they are properlyprepared for any unexpectedoccurrences. Recent researchby the company has revealedthat 22 per cent of thesetravellers have made a medicalclaim, highlighting the need foressential insurance coverage.As an incentive, PJ Hayman isgiving away a free first-aid kitwith every Longstay andBackpacker policy taken out.

New offers forforeign studentsWith an increasing number of foreign studentstravelling abroad to pursue further education it wasonly a matter of time before the growing demandfor insurance cover was met. Cholamandalam MSGeneral Insurance, a joint Chennai-based venturebetween the Murugappa group and MitsuiSumitomo Insurance group of Japan, is the firstcompany to launch an overseas student travelinsurance policy. This new product will provide thenecessary insurance stipulated by foreignuniversities, with additional cover optional and anextension of the first-year initial coverage to thesecond year. Door-to-door coverage is on offer andthe entire pack is available in Indian rupees.

It’s all me, me, me

Preferential Travel Insurance have created a ‘me,me, me’ training session as an integral part of itsagent and tour operator training programme andaims to get sales staff selling insurance on a more

individual level. Thetravel insurance providerhopes it will encourageagents to think moreabout what customerswant rather than whatthey can sell.Max Henssser, NationalSales Manager atPreferential Insurance,said: “Part of the thinkingbehind this concept is toget agents to considerhow they would selltravel insurance tothemselves.”

Mexico offers globalemergency servicesMexican insurer, General de Salud, has taken upAssist America’s offer of travel assistance to coveritself and its affiliated companies when travelling.Assist America’sglobal emergencyservices, throughemployee benefitplans will beeffective as of 1September, andhave beenincluded as aprogrammeenhancement in allnew and existinggroup healthinsurance policies. Participants of thebenefit plans, willhave round-the-clock access tocomprehensive assistance, utilising a vast array ofmany medical services including medicalconsultation, evaluation and referral, critical caremonitoring, hospital admission guarantee,emergency medical evacuation and repatriation,transportation to join a patient, prescriptionassistance, care and transportation of minorchildren, emergency trauma counselling and lostluggage or document assistance. Arturo Sanchez Cerezo, executive director ofGeneral de Salud, said that he has selected AssistAmerica as their provider of international travelassistance based on their global reputation.Headquartered in Mexico City, General de Saludhas over 12 offices throughout Mexico and hasbeen offering integrated health insuranceprogrammes that are customised specially towardsclients needs for over eight years.

Going back tobasics‘Insurance – plain and simple’ is the strapline for therevamped website of specialist insurancewww.protection-insurance.com. To celebrate the re-launch, the company has decided to give visitors tothe website the chance to win an annual travelinsurance policy worth £100 for up to two adults andfour children. The new website will also featureguides, daily insurance news and insurance-relatedarticles. It also aims to make the website a pure one-stop shop for insurance by removing banneradvertisements and anything non-insurance related.It also features new niche products alongside thestaple features of the site.

Barclaycard offersfree travel insuranceBarclaycard customers who book travel abroadthrough the company’s travel service will benefit fromfree worldwide travel insurance, a five per centdiscount on prices from over 120 tour operators anda saving of the two per cent credit card surcharge thatnormally applies. Other benefits of this free cover,which is available for up to six people and includeswinter sports, are a free emergency card replacementand a cash advance service.

Portair launchesnew websiteThe insurance company Travel Portair has launched anew online service to provide insurance professionalswith easier access to travel policies. The companyclaims the benefits of their online service will includeinstant quotes, online booking and on-the-spotprinting of documents.Travel Portair hopes this will increase travel insurancesales for all UK-orientated businesses including touroperators, travel agents and FSA registered brokers.Monthly accounting comes as part of the package,whilst users are also able to view their online accountto track sales and commission.

Mondial Assistanceoffers extra serviceIncreasing cynicism and competition has pushed theinsurance industry forwards in looking for new andinnovative products to secure and enhance theircustom base. Mondial Assistance appears to be onecompany who are serious about such progression –starting off with their screening of hospitals aroundthe world in 2004.A group of 15 doctors and emergency specialistscollected enough information to be able to form anassessment scale, from 108 countries worldwide.The doctors visited 800 hospitals and clinics fromcountries not considered to have ‘high-grade’medical care, assessing the facilities available inpopular vacation destinations and off-the-beaten-track locations. The results were fed into adatabase, which are now available worldwide todoctors and assistors in the 37 companies of theMondial Assistance Group.This gives them a unique source of information attheir fingertips, enabling them to decide quicklywhether someone can be treated locally, needs tobe moved to a specialised hospital or whethertransport home should be organised.Such pro-active research has led to a Top 20ranking for Mondial UK, voted one of the bestcompanies to work for in the south east of Britain.Other worldwide initiatives have been put intoeffect more recently.Mondial Assistance Portugal (MAP) recentlylaunched an innovative new service for accidentmanagement, enabling claims to be processed morequickly that ever after an accident. MAP’stechnicians offer customers on-the-ground andphone support, helping them fill out post-accidentinsurance forms, collecting all documents andevidence (such as photographs) they will need onthe spot – they are also trained in psychologicalcounselling. They have designated specialisedmotorcycles to this end, which are directlyconnected to the call centre via state-of-the-arttechnology and transmit all the information collectedinstantly.In Australia, a special service has been offered todiabetes sufferers by Mondial Assistance Australiaadvising all those insured on all diabetes-relatedquestions concerning treatment, medication and thehandling of this disease in their daily lives. Moreover,Elvia France, a subsidiary of Mondial AssistanceGroup have put together a special package fortravellers visiting Europe’s Schengen zone, where atravel insurance and assistance contract iscompulsory if they wish to obtain a visa. Thispackage guarantees repatriation assistance forcitizens of countries not covered by the SchengenTreaty as well as coverage of any medical andhospitalisation costs incurred in the respectiveSchengen country.

Hurricane Katrina’s devastation becomes ever moreapparent, with the potential health repercussions setto be long-lasting. US environmental experts arewarning that the toxic levels of the floodwatersswamping New Orleans are 10 times that of thesafe level, thus posing a threat not only to the die-hard residents insisting upon staying, but also tothose going in to assist withrescue operations. With underlying threats allover the place, includingnatural gas leaks, traces oflead and concentratedlevels of bacteria notedthroughout the city, thegovernment is faced with agrowing urgency to get theinhabitants still holding outevacuated as soon aspossible. When questionedas to the safety of the city,Mayor Ray Nagin said:“Everybody needs to leave… This is not a safeenvironment. It’s ok toleave for a little while. Letus get this city cleaned up.”Already three deaths have been reported frombacterial infections, and the EnvironmentalProtection Agency is issuing warnings of the risk notjust from drinking the water but also coming intocontact with it. Reports suggest that most are heeding the words ofthe government, looting has stopped and themajority of those left in New Orleans are the armednational guardsmen. Of the 20,000 guardsmen,many are forced to wear bandannas round theirfaces to cope with the highly unpleasant smell andthe infestation of flies.

Floods bringhealth hazards


HEALTHMATTERS12

Despite the constant speculation over theconnection between the use of mobile phones andbrain cancer, scientists have officially given users theall clear. Studies, which are limited by the relative newnessof the technology, have confirmed that there is nosubstantial risk towards developing acoustic

neuroma, which is ofparticular interestbecause of the closeproximity of theacoustic nerve to thehandset. Data wascollected from adults infive different countries,where mobile phoneswere first introduced,and despite previousstudies, theDepartment of Health,which part-funded theresearch, stated thatthere was, “no hardevidence at presentthat the health of thepublic is beingadversely affected by

the use of mobile phones.”There is still little evidence of the effects uponchildren, which is a concern, as their nervoussystems are still developing and this will be exposedto radiation for longer in their lives. Studies onchildren are planned, however. Of the eight studiesthat have previously been carried out, results werevaried and inconclusive, and although two didsuggest a link, it was under entirely contradictoryterms. Information for this study was collected from678 people with acoustic neuroma and 3,553 whodid not have the tumour.

No cancer link tomobile phones

With the increasing number of viral epidemicsbreaking out, federal health officials in the US havedeclared the need for better access to airlinepassenger lists to enable faster knowledge as to thewhereabouts of those who have been exposed toinfectious diseases during a flight, and go some waytoward controlling epidemics. Currently cited as a major gap in the US borderdefences, it can take days of work by the Centresfor Disease Control and Prevention (CDC) to trackdown those exposed to exotic diseases. Despiteyears of pressure on behalf of the CDC to improveaccess to airline data, passenger privacy is theultimate reason for stopping such measures beingimplemented. The Institute of Medicine (IOC), which has beenbrought in to advise governments on healthmatters, has backed this move. It states that there isa significant gap in the nation’s quarantine systemthat could be overcome by electronic access to theairline system and the creation of a compatiblegovernment and airline computer system. Currently, airline databases do not record all theinformation that is needed to track someone downafter a flight, so it has been proposed that whilst anelectronic system is being implemented it isnecessary that every passenger should use locatorcards. These would be distributed on flights fromcountries where disease outbreak is prevalent or if apassenger becomes ill on a flight, and would recordall the necessary contact details so that the individualcould be located after landing.

Illnesses to betracked

Thailand has created its own nationwide vigilancenetwork, but the fundamental problem at the heart ofthe bird flu issue is the preparation of drugs. TheWorld Health Organization (WHO) is urging countriesto boost their use of seasonal flu vaccines in anattempt to increase production and awareness. Currently, the global capacity for creating flu dosesstands at 300 million doses a year, a figure thatwould come nowhere near to coping with a flupandemic. Klaus Stöhr, from the WHO, emphasisesthat flu vaccines are safe, effective and cost-saving,whilst Ted van Esssen, from the University MedicalCentre in the Netherlands, stressed the importanceof offering vaccinations within Europe for free tohigh-risk groups, and paying fees to motivatedoctors to undertake campaigns. The seasonal flu vaccines, changed each year totackle the three most common flu strains, will by nomeans combat a pandemic but would, according toStöhr: “Stimulate additional investment in newproduction facilities and techniques which could beshifted to pandemic production.”

Pandemicpreperation a must

With recent unsettling election results, a stagnanteconomy and a growing number of the populationhaving to go without health insurance, Germany isstruggling to move forward.Germany’s recent overhauls, measures pushedforward by Chancellor Gerhard Schröder, were anattempt to push people off the unemployment-insurance register and into the labour market, intheory, a move to spur people to look harder forjobs by cutting benefits. This also meant thatunemployment-insurance payments that once lastedalmost indefinitely now have limits.At least 300,000 Germans went without medicalinsurance last year, up from 188,000 in 2003,according to a government survey. Although thisfigure pales by comparison to the roughly 45 millionuninsured in the US, one has to remember that thisis a country that prides itself on universal coverage.Walk-in clinics, once exclusive to asylum-seekers,travellers and refugees, now regularly see ordinaryGermans coming through the doors. It is not eventhe poorest that are applicable, as they still qualifyfor state-funded health insurance. It is a growingclass of small-business people who often can’t affordhealthcare payments. Many of Germany’s uninsuredcomes from the middle of society; young peoplewho took advantage of earlier governmentprogrammes that cut welfare rolls to those starting

up small businesses. Theywere supported by thegovernment for the firstthree years, but after thatmany realised they couldn’tafford the costly monthlypayments – starting at 250a month for privateinsurance.German’s health insurance is,theoretically, compulsory, butinsurance companies havebeen under pressure to cutcosts and have createdincreasingly stringentregulations. Non-payment ofpremiums, even for onemonth is enough for a privateinsurance company to cut

someone off, and once cut, other companiesgenerally won’t take you on. Spokesperson for oneof Germany’s biggest health insurers, DeutscheAngestellten-Kranken-kasse (DAK), Nina Waldheim,concedes that many self-employed can no longerpay their fees in such economically difficult times.She goes on to say that although her clients areclearly informed of pending consequences of lack ofpayment the responses are very different,

Germay struggles tomove forward

Thanks to a survey carried out by MondialAssistance, it is easier to know which countries havea safe medical standard – a particularly pressingmatter for travellers. Having visited 800 countries,which are not considered to have high-grademedical care, the findings were sometimescommonplace and sometimes surprising. Fifty-eightout of 108 countries assessed in the guide provedto have a good to very good medical infrastructure.Going on to rate continents, they discovered thatbehind the leading standard of Western Europecame Asia, with impressive standards in thedeveloped areas but still a large medical deficitoutside of those areas. The Middle East and EasternEurope proved to be a mixed bag, with the largercities and the tourist centres equipped with the bestfacilities. Latin America proved to have madeconsiderable progress over the last decade but wasstill marked by stark contrasts. And as expected,Africa trailed the other continents with only a verylimited medical care except for a few larger cities. All results thus far did not belie expectation, butwhere experts were pleasantly surprised, includedCosta Rica, Sri Lanka and Nepal, all of whom wererated excellent for medical care. This is a goodresult for travellers for whom these are increasinglypopular destinations, one less worry in the bag –provided they are insured that is.

Where can you besure of good care


HEALTHMATTERS 13

The Thai government is preparing to tackle theissue of bird flu by installing a proper surveillancesystem. The government has increased its numberof diagnostic laboratories from one to 13 and hasalso begun to stock up on Tamiflu. There are750,000 bird flu reaction force volunteers acrossThailand, and although few have even a basiceducation, they have an intimate knowledge of theirown people and animals and would apparentlyknow within a day if someone caught a cold, letalone came down with something like bird flu. According to Carolyn Benigno, the head of Asiasurveillance operations for the United Nations foodand agriculture organisation (FAO): “The world hasto get ready for a pandemic because the behaviourof the virus can’t be predicted and the movement ofbirds can’t be controlled.” Information and training isbeing given countrywide and is expected to makethe difference in containing a pandemic. So far, avian flu has killed 62 people in SoutheastAsia since its initial outbreak in Vietnam in 2003, andhas resulted in the deaths of 140 million birds. Mostworrying, it recently made a westward jump of

hundreds of miles by appearingin Russia and Kazakhstan,prompting the EU to assess itsown readiness to handleinfections. It is hoped thatvolunteers in Thailand will beable to report any outbreakwithin a day or two and thatcentral government will beinformed within one to two daysof that. The consensus is thatany pandemic is most likely tooccur in Southeast Asia, sincethe main areas hosting the fluare Thailand, Cambodia,Vietnam and Indonesia.

Thailand createsbird flu force

As if Gate Gourmet hasn’t had enough tocontend with of late, reports haverevealed how potentially fatal traces of theE.coli bacteria were found in mealsintended for British Airways passengers. The Times newspaper, UK, claims to havefound documents referring to GateGourmet, the airline food companyalready at the centre of a bitter industrialdispute, entitled MicrobiologicalInformation 2003-2004. It, apparently,identified eight meals infected with food-poisoning bacteria between August 2003and August last year. E.coli can causediarrhoea and kidney damage and trigger fatalinfections. The report goes on to talk of a numberof other health and safety regulation failings. Inresponse to the E.coli claims, a spokesperson forGate Gourmet said the products with E.coli hadbeen identified before they reached the aircraft:“Gate Gourmet discovered cases of E.coli from asupplier and has not used the supplier since.”

Airline mealsinfected with E.coli

As of 1 September, the European Health InsuranceCard (EHIC) came into effect as the replacementfor the E111. Widely available, it will ensure thatEuropean travellers get free or discountedemergency healthcare throughout Europe. Traditional E111s ceased to be available from 31August, but those with a current form will still be ableto use it until the end of the year. The new EHIC is

issued on an individual, asopposed to a family basis, and theapplication form must be sentdirectly to the Department ofHealth for validation and card distribution.It is advised that anyone planningto travel in the EuropeanEconomic Area during 2006should apply for the EHIC wellin advance. Governments are,however, reinforcing the fact theEHIC is not a substitute fortravel insurance and travellers should still take out a travelpolicy to cover for anyunexpected costs.

EHIC is up andrunning

UK Health Protection Agency statistics show a risingtrend in the number of cases of Legionnaires’disease since 1980. And it seems that hotelsworldwide are not heeding warnings. Worldwide checks at hotels of the threat posed bythe killer bug legionella have revealed that mosthoteliers are not aware of the dangers associatedwith the bacteria and have very few checks andregulations in place to monitor and control it.Legionella is the sole cause of legionnaires disease,and kills as many as one in 10 people who contractit. Holiday accommodation is seen as the perfecthost for the bacteria, as it is prevalent in areas ofinadequately maintained large-scale water or air-conditioning systems. Guests are exposed to itthrough showering, using swimming pools or spasand operating air-conditioning units. Despite being ahygiene-related disease, it is dubbed an invisiblekiller as it is very difficult for holidaymakers to pindown the cause of the disease. According toCheckSafetyFirst chief executive, Steve Tate: “Themain issue is that hotel health and safety is still in its infancy.”

Hotels breedLegionnaire’s

TRAVELMATTERS14


Oz minister defendsborder securityThe Australian Government has denied thatAustralia’s border security could be put at risk bya trial using retirees and university students forpart-time customs work. From Miles Clarke inSydney

Twenty-three people have begun training for thepart-time roles with Customs and will checkpassports at Sydney and Adelaide airports.The customs and justice minister, Chris Ellison, saidthe programme was an innovative way to deal withpeak periods at airports. He said there were manytertiary students and older people who would bevaluable members of the workforce. Australia is one of only a few countries in the worldthat checks people leaving the country as well aswhen they arrive. That last check before passengersboard planes includes detecting over-stayers and

children beingremoved indefiance offamily courtorders.Senator Ellisonsays bordersecurity will notbe diminished bythe trial. “Thereis nothing wrongin using a part-timer,” he said.“This is a trialthat perhaps canbe broadened

but it’s only a trial. It’s nothing more than that, it’snot a fait accompli.“What I am saying is this is that border protection isvery important but we do have to processpassengers in a timely fashion and I think it’s wise tolook at alternatives.”Opposition justice and customs spokesperson, JoeLudwig, says only professional Customs staff shouldbe involved in the security checks of suspecttravellers. “Whether they might be a suspected drugcourier or whether they might even be a suspectedterrorist, andthose sorts ofthings areusually donebyexperiencedcustomsofficers,” hesaid. “Thepublic expectthat to bedone byCustomsofficers. Whywouldn’t youjust simplyleave it withCustoms?”

All seems secureDown UnderA recent survey conducted by the Tourism andTransport Forum (TTF) Australia has concluded thatAustralia is still perceived as a safe destination bytourists, despite ongoingconcerns with the current globalsituation. Roger Allnutt reportsfrom Sydney

Although the survey of 147senior members of the TTFfound that over 90 per cent feltthat Australia was considered asafe place to travel to, it was, likemany other countries, regardedas less safe than it was before theSeptember 11 attacks in the USand subsequent terrorist activityaround the globe.Since 2001, Australia has takenstrong measures and invested millions of dollars tostrengthen aviation security. TTF managing director,Chris Brown, said: “Australia’s aviation industry hadborne a significant proportion of the costs ofenhanced aviation security, but security is an issue ofnational importance and should be funded by thegovernment.”The survey found, that the great majority of thosesurveyed believed proceeds from the sale, in recentyears, of airports around Australia previously ownedby the government to the private sector should beused to fund the ever-increasing costs of additionalsecurity at Australian airports rather than imposingnew passenger levies and taxes.“We cannot afford to compromise the competitivenessof our domestic and international tourism market byimposing further costs on the industry or consumers,”Mr Brown said. “TTF is calling for a consistent andstrategic approach to balance the need for public safetywith industry viability.”

Filtered air forfrequent fliersHelp could be at hand for fliers who take to theskies regularly and often come down with coughsand colds. A new device is on sale in the US thatfilters cabin air. Passengers attach the device, called AirRight, to thenozzle above their heads which will remain effectivefor four flights. The manufacturer, Cirrus Healthcare,claims it removes 99.5 per cent of viruses andallergies. Airlines and aviation health experts,however, say that cabin air already passes throughhigh-efficiency filters which are designed to removebacterial and viral particles and that travellers face agreater risk of contracting something nasty whenthey are in the terminal than when they are on a flight.

In-flight mobilephone talk quashed

The Federal Aviation Administration (FAA) hasended all talk of changes to allow in-flight cell phone

use. OnAiroriginally saidthe servicewould beavailable onshort-haulEuropeanflights after ithad signed adeal withSiemens toprovide thetechnology,while Ericssonsaid it wasdeveloping a

system that would be available for installation by theend of this year.The FAA, however, has disagreed with the FederalCommunications Commission’s decision to possiblylift the 14-year-old ban. “The FAA is not changing itsrules,” Nicholas Sabatini, FAA associate director ofaviation safety, announced at a congressionalhearing. He went on to say that airlines would haveto prove that cell phones are not disruptive toairline navigation. British Airways has begun to research the issue withinitial feedback from customers indicting they wouldprefer the service to be limited to text-only.Opinion among pro-business groups is divided.Whilst some favour the use of cell phones, others,such as John Mica, chairman of the house of aviationsubcommittee, strongly condemn their usage: “Thelast thing most air passengers want is to be forcedto listen to their neighbour chat on their cell phoneabout their ailments.”

US airlines fightbattle of the bulgeAs Americans get fatter, the nation’s airlines havebeen told to recalibrate their passenger weightestimation procedures to make sure their planes canget off the ground and stay aloft as intended. MilanKorcok weighs up the new rules

New federal regulations that took effect 11August2005 now require airlines to assess the averagefemale passenger with carry-on bags at 179 pounds(81 kg) in summer and 184 pounds (83 kg) in winter.The average weight for male passengers with carry-ons has been pegged at 200 pounds (91 kg) insummer and 205 pounds (93 kg) in winter.Interestingly, the new guidelines have increased 35pounds for women and only 15 for men, suggestingperhaps, that American women are packing on theavoirdupois even faster than men. Children andadolescents aged between two and 13 are to becalculated at 82 pounds(37 kg) in summer and87 pounds (39 kg) inwinter. The guidelines are usedby aircraft to calculatefuel requirements,takeoff speed, as well asthe weight and centre ofgravity of planes beforeflight. “Each commercialairline is required to havea weight and balanceprogramme that includesprocedures fordetermining that itsaircraft are properly loaded,” says the Federal AviationAdministration (FAA). The passenger weight recalibration was prompted bythe 2003 crash of a US Airways Express flight atCharlotte-Douglas Airport, in North Carolina, inwhich 21 passengers and crew were killed. That crashwas blamed partly on improper estimation ofpassenger weight and baggage. As a result of thatcrash, the National Transportation and Safety Boardrecommended that the FAA require airlines toperiodically weigh passengers and their carry-on gearto get better average estimates of aircraft plane loads.The growing bulk of American passengers hasimpacted all airlines already struggling with increasedfuel demands and related costs. Many have alreadydumped weighty cabin items such as food carts, metalforks and spoons, magazines, even life vests. Manymetal cabin parts and furnishings have also beenreplaced by lighter plastic. Bruce Barimo, vice president of operations and safetyat the Air Transport Association, told the media thatone of the side benefits of scaled back in-flight foodservice has been the elimination of food carts, whichcan add hundreds of pounds of extra weight. Some smaller commuter planes, such as the USAirways Beech 1900 that crashed, have even cut outrows of seats and reduced their cargo space to allowbulging passengers with ever more carry-on packagesto fit into the small cabins. According to the US Centers for Disease Control andPrevention (CDC), not only did Americans’ addedbulk cause airlines to spend $275 million to burn 350million more gallons of fuel in 2000, but that extraburned fuel also caused an estimated 3.8 million extratons of carbon dioxide to be released into theenvironment.The CDC notes that the weighing down of aircraftcoincides with a relentless obesity epidemic thatcontributes to at least 400,000 premature deathsannually. It adds that over 56 per cent of US adults areobese. Though US airlines are reluctant to startweighing in passengers, at least one – Southwest –requires super-size people to buy a second seat, fortheir own and other passengers’ safety and comfort.Other airlines, among them US Airways, Northwest,and America West may require second-seatpurchases, but rarely do. “Maybe instead of just using those [boxes] at the gatesto limit carry-on bags to certain sizes, the airlines needto have a people-sizer with a sign asking, ‘Do you fitinto this’?” Dave Grotto, of the American DieteticAssociation, told the Chicago Tribune.


TRAVELMATTERS 15

CAA reveals strangeluggage items Blowtorches, petrol-fuelled generators and distressflares are among items that air passengers haveattempted to take on board aircrafts recently, theCivil Aviation Authority has revealed. In one incident a blood pressure monitor containingthe lethal chemical mercury – which was taken onboard successfully – broke and caused significantdamage to the structure of the aircraft. Theextraordinary list of items emerged as the CAA

issued a reminder to those heading abroad not topack dangerous materials in their luggage. CaptainGraham Grey, head of flight operations standards atthen CAA said: “The majority of passengers arevery careful and know which items cannot be takenon board. However, many passengers don’t realisethat some items which are relatively innocuous ineveryday use are capable of posing a serious risk.”

Jetstar to give boostto QantasAustralia’s national carrier, Qantas, appears to bequite unsentimental about its internationaloperations, signalling moves to ramp up itsbudget Jetstar subsidiary into routes where thefull service carrier fails to make money. MilesClarke reports

Aviation analysts predict Jetstar will fly to areaswhere there is little demand for business-class seats,such as Bali, Honolulu and even Rome. Qantas willinstead stick to the main routes frequented bybusiness-classtraffic, such asSydney toLondon and LosAngeles. Andwith its fifth fuelsurcharge in 15months, theairline has raisedthe cost of aticket for anyoneflying to Londonwith a stopoverin both directionsby about £125on top of the ticket price. Jetstar’s ascendancy is seen as a key plank in Qantas’plans to cut billions in costs by 2008. Jetstar’sinternational expansion could replicate Qantas’ movesdomestically, where Jetstar has replaced Qantasservices to leisure destinations such as the GoldCoast. Regulatory approval for Jetstar’s internationaloperations could take a year.The airline is also slashing costs with the installation ofdo-it-yourself check-in machines, which will have animmediate effect on staffing levels, and the airline’schief executive Geoff Dixon warns of further lay-offsdespite the airline’s highly profitable trading position.

New rules call forhigh-speed craftThe chief inspector of the Marine InvestigationBranch (MAIB), Stephen Meyer, has urged that theUK urgently needs to revise controls on high-speed craft. Chris Wales reports

Mr Meyer said: “Such vessels have more incommon with operating aircraft than ships and thisshould be reflected in the rule book.” Mr Meyer’scomments are contained in a document entitledRecommendations Annual Report 2004, recentlypublished by the MAIB. He points out that

operators of high-speedcraft sit in a cockpitsurrounded by a bank ofmonitors and equipment,yet requirements in areassuch as bridge layout differlittle from those governingconventional craft. Hewrites: ”For example, in adigital age, it is absurd thatfor navigation such craftneed only have papercharts at the back of thebridge. Accidents over thelast ten years, including

one with sixteen fatalities, have clearlydemonstrated the need for change.”High-speed craft operators themselves maintainstandards are already high, witnessed by the millionsof passengers safely carried. Sea Containers operatestwo fast craft from Dover to Calais under theHoverspeed brand, and over a dozen elsewhere inthe world. David Stocks, Sea Containers generalmanager of operations for ferries, said: ”Many aspectsof current rules are already modelled on the aviationindustry, in particular the appointment of the ‘typerating’ of officers, who need specific qualifications tooperate fast craft.”

Mixed fortunes fornational carrierThere were pluses and minuses in theannouncements made by Qantas AirwaysCEO, Geoff Dixon, at a recent news conference.Roger Allnutt has the details

Top of the agenda was the net profit of AU$763.6million for the 2004/05 financial year, a good resultgiven the tough circumstances being faced by allairlines around the world. However, the continuingrise in the cost of aviation fuel is still a major causefor concern, with Mr Dixon foreshadowing thatQantas faced a fuel bill in 2005/06 of over AU$1.2billion greater than for the previous 12 monthsrepresenting 30 per cent of the airline’s operatingcosts in 2005/06 compared to 15 per cent in theprevious financial year. Indeed, in recent days,Qantas has introduced (as have other airlines inAustralia) a further rise in the fuel surcharge – thefifth time in recent years.Despite the profit, the airline is going ahead withplans to cut costs; the airline’s ‘sustainable future’cost-cutting programme is aimed at saving morethan AU$500 million in the current financial year.Most contentious of the cost-cutting strategies is aplan to further shed jobs across the airline’sworkforce. Already, around 200 seniormanagement positions have been cut in the pastfew months and over the coming year there areplans to reduce the current workforce of around38,000 staff by a further 15 per cent. The unionsrepresenting other areas such as flight attendants,security staff and baggage handlers have continuedto voice their concerns citing possible reduction inpassenger safety as a major worry.For passengers, the steadily increasing range ofcharges and taxes including government taxes,airport charges, security charges, and noiseabatement levies means that for some routes thecost of taxes is nearly equal to the base fare, anincreasingly intolerable burden that does not seem to have any likelihood of being reduced in thenear future.

Japan testsConcorde successorJapan’s space agency JAXA has announced plans tolaunch an arrow-shaped airplane at twice the speedof sound, high over the Australian outback in lateSeptember/early October. This is the first in a seriesof new tests following the failure, three years ago,of initial trials. The experimental craft, which wasplaced upon a rocket booster, became separatedprematurely and crashed into the desert.The second plane to be launched will follow asimilar principle – the rocket will carry the plane toan altitude of 12.4 miles before releasing it at aspeed of Mach 2, where information about theplane’s aerodynamics will be collected. After a 15minute flight the craft will then float back to earth byparachute. When questioned about improvedconditions of the aircraft, Takaaki Akuto, aspokesman for the Japan Aerospace ExplorationAgency, said: “We’ve made some improvements sothat won’t happen again.”If the mission proves to be successful, furtherresearch will go ahead to create a craft that iscapable of carrying 300 passengers at Mach 2, ortwice the speed of sound, meaning a trip fromTokyo to Los Angeles would be complete in fourhours. It will also confirm a June agreementbetween Japan and France to split an annualresearch budget of about $1.84 million over the next three years to develop a faster-than-sound plane.Two companies involved in the testing areMitsubishi Heavy Industries and Airbus parentEuropean Aeronautic Defence and Space Co. Themain problems anticipated are jet-engine noise andhigh fuel consumption. Japan has already successfullytested an engine that can theoretically reach speedsof up to Mach 5.5, or more than five times thesound of speed. They hope to have a successor tothe Concorde making regular flights by 2020.The last Concorde retired from commercial servicein October 2003, 34 years after it was launched,and billions in taxpayer’s money later. Having alwaysstood as a symbol of French and European industrialacumen, a replacement supersonic flight that iseconomically viable will be a significant mark inprestige for any nations involved in its production.

Taiwan bullet trainput back a yearTaiwan’s plans for a bullet train, one of the world’slargest build-operate-transfer projects, has beenthrown into further funding crisis with theannouncement of its one-year set back. Taiwan High Speed Rail (THSR), the private companythat builds and plans to operate the TW$460 billion(US$14 billion) bullet for more than 30 years, risks thecreation of a legal battle with the Japanesesuppliers. Despite the basic infrastructurebeing complete, along with the trackconstruction, it is the electrical andsignalling equipment that is causing thedelay, as well as the testing of theShinkansen system, which is almost 40 percent behind schedule. The THSR havesaid that the delay would cut the operationperiod under the BOT contract by oneyear, leaving the investment rate of returnto fall to 13 per cent from 14 per cent,making it even harder for them to fund theproject. Nita Ing, THSR chairwomancommented: “This is the first time Japanexports this system. The difficulties haveexceeded the extent both sides expected when.” Additional financing and operating costs will drive upthe total investment to TW$480 billion fromTW$461 billion, however, slower-than-expectedprogress would also lower the progress fromupcoming payments. The estimated TW$9 billionincrease in payments is expected to be covered bythe syndicated loan of the banking consortium set up initially.


NEWSANALYSIS16


It has not been a good summer for the airline industry, with a host of fatal crashes blighting commercialflying. Milan Korcok analyses theconsequences for the airline insurance market

For the commercial airline industry, itdoesn’t get much worse than thesummer of 2005: the horrifying ‘nearmiss’ of an Air France A340 carrying 309passengers on a stormy runway inToronto, 2 August; the crash off Sicily ofa Tuninter ATR-72, 6 August, 13 killed;The Helios Airways Boeing 737 hitting amountain in Greece, 14 August, 121killed; The West Caribbean Airways MD80 crashing in Venezuela, 16 August,160 killed; the TANS Peru Boeing 737breaking apart on landing at Lima, 23August, 40 killed; the Mandala AirlinesBoeing 737 crashing into a crowdedneighborhood in the Sumatran city ofMedan, 5 September, 149 killed. Thisafter a 16 July Equatair crashed aftertakeoff from Malabo in EquatorialGuinea, killing 60.Of those, only the Air France Airbuscame off without a fatality, although thecraft itself was incinerated. Among theothers, 543 dead – a total of 647 if oneadds the 104 killed on 3 February in theKam Air Boeing 737 crash in the highmountains near Kabul, Afghanistan.Not a stellar year for flyers, butaccording to statisticians, not catastrophiceither, considering that, usingInternational Civil Aviation Organization(ICAO) figures, almost two billionpassengers flew on commercial flightslast year, not including charters.Though this year’s fatalities are already higher thanall of last year’s (28 accidents accounting for 466deaths – the lowest in 20 years according to theUS-based Flight Safety Foundation), the trends havecontinued to press steadily downwards since 1945,and nowhere are the statistics better than in NorthAmerica, Western Europe, Japan, Australia and

New Zealand – all of which are vying for top spotfor safety. Of course, had the Air France Airbus notbeen so ‘miraculously’ evacuated 90 seconds from aravine at the end of Toronto’s Pearson InternationalAirport, there might have been a spanner throwninto the works, but the craft was evacuated with nofatalities and much of the credit has gone to a

cabin crew superbly trained in the WesternEuropean tradition.

Safety issuesDespite this summer’s toll, airline safety expertsinsist that air travel remains the safest means oftransportation. According to the ICAO, there was

one fatal accident last year per two million flights. In1979 there were three fatalities per million flights.And, according to Britain’s Civil Aviation Authority,travelling by air is still the safest means of transporton a fatality per kilometre basis. However, that doesnot mean, say other safety experts, that all air travel,on all airlines, serving all countries is equally safe,and there’s the rub.Recently, for example, Indonesian air transportauthorities grounded four Boeing 737-200sbelonging to four unnamed private airlines in thewake of the Mandala crash, until problems withnose landing gear wheels were rectified.In September, the Ministry of Transport of theDemocratic Republic of Congo revoked AirOperator Certificates for 33 of the country’sairlines, some of which flew cargo planes fitted withplastic chairs to hold passengers. Also in September,Swiss aviation authorities published a list of airlinesthat were banned from flying into the country forsafety reasons: among them Flash Airlines fromEgypt, and Air Van Airlines from Armenia. A fewdays earlier, France and Belgium listed 14 airlinesbanned for safety reasons from using their airportsor air space.The European Commission is also preparing a list of airlines banned from flying in the European Uniondue to safety concerns, and the US has a similar list based on entire countries rather than individual carriers.Dr Graham Braithwaite, an aviation expert and

Will recent crashes spur insurance?

director ofCranfield(University)Safety andAccidentInvestigation inthe UK, said: “Itis wrong forpeople to befrightened offlying becauseof these crashesbut they shouldbe informedabout who theyare flying with.All airlines arenot equal.”In that respect,DavidLearmount,safety editor forFlight International, a trade publication, says thatAfrica as a continenthas an ‘appallingrecord’, while someformer Soviet Unionand Pacific Rimcountries have alsorecorded poorperformance.In the US, ArnoldBarnett, professor atthe Sloan School ofManagement,MassachusettsInstitute ofTechnology, says thatover the past five years, no passengers died on alarge airline jet flying from one US city to another,and that accounts for over 70 million flights,although 265 were killed when an American Airlines767 went down in a suburb after take off from JFKInternational in New York, on route to theDominican Republic in October 2001.Barnett also notes that airlines in Africa, LatinAmerica and Asia (not including Japan) traditionally

have the worst accident records, but have chalkedup the biggestimprovements in recentyears, reducing theirmortality risk by threetimes following majorsafety campaigns byinternational aviationauthorities. He adds thatin the 1990s, peoplewere 26 times morelikely to die on flights inthe developing worldthan in the industrialworld.The president of the

Montreal-based ICAO, Assad Kotaite, also contendsthat: “The global aviation system is fundamentallysafe. However, there must be an unobstructed flowof safety-related information by everyone involvedin air transport, at every level and across everysafety discipline.”“The ICAO’s Unified Strategy to resolve safety-related deficiencies reminds all states of the need forsurveillance of all aircraft operations, including

foreign aircraftwithin theirterritory,” addsKotaite.

Airlineinsurers staycalmThis greatinequity in airlinesafety fromcountry tocountry andairline to airlinesparks a dilemmafor the world’stravellers andthose whoinsure them and

the planes they fly in, although the recentspate of crashes is not expected to pushup insurance rates for the airline industry.In a report published in Bermuda’s RoyalGazette, which closely follows insuranceissues, Bob Hartwig, chief economist forthe New York-based InsuranceInformation Institute, said it is importantto note that of the five recent crashes(this summer) only one involved a first-world airline using top-of-the-lineequipment with proper air traffic controlat a major airport in a rich country (atelling demographic for those planningtrips to exotic destinations). In the AirFrance crash, the European insuranceindustry could potentially see claims ofup to $100 million on the hull damage,but it is the liability on medical and deathcoverage that makes up the biggestcosts, he said.Most aircraft have at least $1.5 billion onliability in addition to hull coverage, saidHartwig. Airlines in modern economiescan face compensation payments tofamilies that can run from $2.4 million to$4.1 million per passenger, based on thepotential salary of individualsover their lifespan.Despite the Air France crash,analysts in the US expectairline insurance rates, whichmore than doubled after2001, to continue falling at10 per cent to 15 per centannually, as they have overthe past four years.Hartwig agrees that therecent crashes are not likelyto impact major modernairlines. He told the RoyalGazette: “The rates for theseairlines operating in thesecountries with modernaircraft and training isseparate from what it is for airlines that no one hasheard of in Peru or Tunisia where there arefundamental questions about maintenance ofaircraft, training of crews and those sorts of things,all of which can factor into probability of an accident.“You can’t make a broad brush approach and say allaircraft insurance rates are going to rise because ofwhat happened. You have to look at this as not asingle market. Insurers don’t look at it as a singlemarket. Different airlines present different risks andthey are treated as such.”

Will flight insurance become mandatory?So to individual travellers and their propensity toselect travel insurance. In one informal air travellersurvey done in 2004 by MedAire, an Arizona-basedmedical assistance firm for airlines, fewer than half ofthe respondents said they would supportcompulsory travel insurance to protect against suchcontingencies as medical emergencies, aircraftdiversions, or other unforeseen contingencies.

It is also apparent that airlines, now under terrificstress to cut costs and hold down fees, would fighttooth and nail against any levy – be it voluntary ormandatory – designed to cover their passengers incase they crash. And should governments seek toimpose mandatory travel insurance premiums tohelp out their nation’s airlines, they would beaccused of the grossest insult of all – raising taxes –especially heinous as the insurance industry confirmsthat its rates for covering aircraft are heading down.Encouraging travellers to buy travel insurancegraded according to the risk of flying certain airlinesto certain destinations is a highly desirable as well asachievable target for the insurance industry.However, expecting airlines or governments toimpose it is unlikely, at least so far as MedAire’s ownsurvey shows, and as experience with publicattitudes about taxation bears out.

See also our feature on p.22, Should travelinsurance be compulsory?

Should governments seekto impose mandatory

travel insurance premiumsto help out their nation’sairlines, they would be

accused of the grossestinsult of all – raising taxes


NEWSANALYSIS 17

This year to be hosted at the

ALFONSO XIII,

SEVILLEFor further information andtravel reservations contact:

VOYAGEUR EVENT MANAGEMENTVOYAGEUR BUILDINGS

43 COLSTON ST, BRISTOL BS1 5AX, UK

te l : +44 (0)117 922 6600

f a x : +44 (0)117 929 2023

emai l : [email protected]

6-8 NOVEMBER 2005

Two seperate conferences

6th November 2005Afternoon registration & welcome function

7th November 2005 – Day 1Keynote Speaker 1 Spanish Minister of Health Speaker 2: Statistic of the European health market – Prof. Ray Robinson - Professor of Health Policy,

LSE Health & Social Care - London School of Economics & Political ScienceSpeaker 3: Growth of Health insurance in China – Bill Liang, Managing Director - China Healthcare

consulting Speaker 4: Building of new hospitals – Bart Daniel, V.P, CFO - United Family Hospitals & Clinics

LunchSpeaker 5: Oregon experiment – how rationing in the public sector creates a private market –

Prof. Ann Bowling & Dr Clare Harries, Dept of Primary Care & Population Studies - Royal FreeSpeaker 6: Health Tourism South Africa – Bernadette Breton, Managing Director - Alliance

International Medcal ServicesSpeaker 7: From gift to markets: the ethical & legal implications of live organ donation –

Shelia M Rothman, Sociomedical Sciences - Columbia, New York.

8th November 2005 – Day 2Speaker 8: Infectious diseases in Non-EU immigrants – Rogelio Lopez-Valez,

Associated Professor of Medicine - Alcala University, MadridSpeaker 9: Worldwide blood standards & procurement – Dr Jukka Koistinen,

Former Deputy Director of the Finnish Red Cross Blood ServiceSpeaker 10: Genetic Screening, analysing the implications of advances in genetics, knowledge for

insurers and mitigation of risk – Richard Walsh, Head of Health – ABISpeaker 11: Role, Advantages and Benefits of telemedicine across global boundaries –

Larry Jones, Director of Tele-health Services - M.D Anderson Cancer Centre

in one fantastic venue…INTERNATIONAL TRAVEL INSURANCE CONFERENCE 2005

For further information andtravel reservations contact:

VOYAGEUR EVENT MANAGEMENTVOYAGEUR BUILDINGS

43 COLSTON ST, BRISTOL BS1 5AX, UK

te l : +44 (0)117 922 6600

f a x : +44 (0)117 929 2023

emai l : [email protected]

8th - 11th NOVEMBER 2005

This year to be hosted at the

ALFONSO XIII, SEVILLE

SIGN UP TO THE NEW

MY ITICFEATURE TO GET LATEST

UPDATE AND INFORMATION

Tuesday 8th November 2005

16:00-20:00 Registration18:00-20:00 Welcome function

Day 1: Wednesday 9th November 2005

Keynote Speaker Disaster and rebuilding - Johan Schaar, Secretary General's SpecialRepresentative on the Tsunami Operations – International Federation RedCross

Speaker 2: Forecasts for future catastrophes – David Kerridge, Manager, Seismologyand Geomagnetism Programme – British Geological Survey

Speaker 3: Travel re-insurance implications – Paul Nunn – Catastrope Modelling –Lloyd’s Risk Management

Open forum Panel Session: Changing the way policies are written to reflect new travel booking

patterns(a) Simon Powell, Group Head Insurance – Ebookers Plc(b) Chris Price, Pet & Travel Business Manager – Direct Line(c) Frank Fotia, Vice-president – Nat Insurance & Automotive Alliances

Canadian AutomobileLunch

Optional Focus Groups Room 1:14:30-15:30: United States injury claims – Michael Kleeman – Kleeman Law Firm15:30–16:30: Hospitals & the impact of pre-existing claims – Allan Jones - United Medical Corp16:30-17:30: Marketing Clinic – interactive/debate – Michael Smith of SeaMountain Room 2:14:30-15:30: International Air Ambulance Operators Forum15:30-16:30 International Air Ambulance Medical Directors Forum

Day 2: Thursday 10th November 2005

Debate: Should travel insurance be compulsory?(a) For – Reg Allat, CEO - ETFS (b) Against – Fiona McDonald, Travel Underwriting Manager –

Europ Assistance(c) For – Laura Hilton, Director, Global Health & Safety - HTH Worldwide(d) Against – Fernando Gomez, Deputy Development Manager –

Mapfre AsistenciaOpen forum

Presentation: Video clips from ‘Is Harry on the Boat?’Panel Session: The serious side of drug & alcohol related accidents – losses associated

with direct and indirect abuse, use or misadventureUnderwriter – Steve Wilcox & Joe Valdez - AXAAyia Napa ClinicAndrew Eaton-Hart, Barrister – Walnut House ChambersPeter Gutelius, Senior Counsel - RBC Insurance

Open forum

Optional Focus Groups: 14:30-15:30 Q & A Law Session – Costas Andrea - Penningtons Solicitors 15:30-16:30 Defying the myths at Lloyd’s – David Stirling - Crispin Speers &

Partners16:30-17:30 Setting standards of care in popular tourist resorts – Jon Phillips

- BMESF

Day 3: Friday 11th November 2005

Session: Discrimination, pre-existing conditions and lifestyle underwriting

Speaker 4: Mental disability: speaker to discuss problems encountered by consumersand insurers – Leo de Graaf, Regional Vice President - World Federation for Mental Health

Speaker 5: Natalie Salmon, Head of Access to Services & Transport - Disability Rights Commission

Panel Session: Medical Screening – What are insurers doing in different regional markets?issues for sellers & distributors and approaches taken when client answersat point of sale are not truthful.Dr Ron Mayer - WTPPaul Beven - Healix InternationalOle Aerthoj - European Insurer/Underwriter

Speaker 6: Lifestyle underwriting; A new way of looking at travel risks – Gary Andrews, Senior Vice President - ETFS

Open forum CloseEvening Gala Dinner

For full details and agenda visit www.itic.org.uk

Return your completed entry to: Denise Clements, International Travel Insurance Journal,Voyageur Buildings, 43 Colston Street, Bristol, BS1 5AX, UKClosing date for receipt of entries – Friday 30 September 2005All entries will be acknowledgedAll finalists will be notified by Friday 28 October

The five finalists for each category will then be given an opportunity to submit supportingdocumentation, these details will be confirmed once you have been notified as a finalist.Do not forget that the winners and finalists will gain exposure in terms of publicity in ITIJ andother related press.This gives you the opportunity to use the award in your own publicity and promotional material,which will be recognised by your peer groups and throughout the industry.

Send your nominations now!

Dr Mr Mrs Miss Ms Other: ________________

First name: __________________________________________

Surname: __________________________________________

Job title: ____________________________________________

Company name: ____________________________________

Company address: __________________________________

__________________________________________________

Contact tel: ________________________________________

Contact fax: ________________________________________

Email address: ______________________________________

Signature: __________________________________________

If successful, who will collect the award on the night?

Name: ____________________________________________

Job title: ____________________________________________

I wish to enter the following category in theInternational Travel Insurance Awards(Please use a separate entry form for eachcategory, photocopies are acceptable)

CategoriesInsurer/Underwriter of the year – inluding intermediaries, brokers

and all sellers of travel insuranceAssistance or Claims Handler of the yearMedical & Cost Containment Company of the year – including

hospitals, clinics and PPOAir Ambulance of the yearGeneral Provider of the year

I enclose the following:6 copies of the 750-word text document entry, including the sixkey figures and criteria as outlined aboveA signed and completed entry form attached to each copy of theentry (All entries must be received in English)

2005

Aw

ards

Ent

ry F

orm

Why enter? The awards will be presented at a glitteringceremony in Seville on 11 November.For those companies and individuals shortlisted in any of thecategories, it will be a memorable evening.The awards are designed to recognise and reward excellencein the travel insurance industry. For the winners and highlycommended finalists the awards offer the opportunity to usethis recognition to further your business. The awards logo canbe used on stationery and marketing literature to highlight yoursuccess.

Who can enter? The awards are open to all sectors of theindustry. If you wish to nominate a third party, please email ustheir contact details.

The Categories See the entry form below for the categories. Ifyou are unsure which category your company should beentered into please email us at [email protected]

Dates to rememberDeadline for all entries: Friday 30 September 2005Judging and announcement of finalists: Friday 28 October2005Awards ceremony and dinner: Thursday 11 November 2005

How to write your entryState your nomination in no more than 750 words. The jury will look for the following key features:

What you have done to merit the award in the past year

How you have grown/progressed your business in the pastyear

How you plan to build on the success of the past year

How you meet the criteria set for your respective category

JudgingThe judges will also look for excellence and professionalismin the following criteria, where relevant:

Area of expertise, including industry knowledge

Marketing and promotional activities

Involvement with trade bodies

Business growth

Client relationships

Staff training

The Judges

All judging is independent and entriesare treated in the strictest of confidence.

The judges come from a wide rangeof backgrounds, all with an interest in thetravel insurance industry.

The shortlisting panel will assess all entries and put forward five panellists for each category. The final judging panel will select the winner and highly commended candidate in each category.

… featuring the ITIJ awards

AIR AMBULANCE SPECIALISTS, INC. When Quality and Trust Count

US Toll Free 1-800-424-7060 • Phone +1 (720) 875-9182 • Fax +1 (720) 875-9183 • Email: [email protected] • Web: www.airaasi.com

Air Ambulance of theYear Award Winner

OUR AWARD-WINNING SERVICES INCLUDE:• Worldwide Private Fixed-Wing Air Ambulance Service• Medical Escort Service• Commercial Stretcher Transportation

• Licensed and Insured • 35 Years of Combined Experience• ACLS & Flight Physiology Trained Staff• MDs, RNs, RTs and Paramedics• Bedside-to-Bedside Service• 24-Hour Operation – Seven Days a Week

The soaring cost offuel has made thefuture for helicopterrescue operators lookbleak. However, thedemand for the serviceremains strong fromthe insurance industryand governments, asRobin Gauldie reveals

‘Hurricane seasongood for business’reads the heading onthe authoritativeaviation industrywebsitewww.aviationtoday.The hurricane seasonhad been a boon foremergency helicopterservice operators in theGulf of Mexico, whoreported a dramaticincrease in storm-related evacuations andsearch-and-rescueoperations. Somecompanies reported a50 per cent increase in fleet utilization. Cynical?Perhaps. That story, though, dates not from 2005and the devastation of New Orleans, but fromNovember 1998, when a glutted oil marketproduced the lowest fuel prices in more than adecade.Helicopter rescueoperators wereequally busy overthe wreckage ofthe Big Easy thisSeptember, but fewwere rubbing theirhands with gleeover potentialprofits. Soaring fuelprices have seen tothat. From historiclows seven yearsago, rotorcraft fuelprices have takenoff near-vertically in the past two years.Have we been living in a fool’s paradise? Not anymore than any other element of the aviationindustry, which some would diagnose aschronically in denial of the long-term inevitability ofvery substantial increases in fuel prices.Helicopters are thirsty birds at the best of times.Even the newer, more fuel-efficient models burnaround three quarters of a gallon to a gallon of fuelper minute.Older rotorcrafts burn as much as two gallons aminute. With a mandatory three-minute warm upand two-minute cool-off before and after eachflight, that’s ten gallons of fuel burned while thehelicopter isn’t even in the air. In the US, Jet Afuel, used in most turbine engines, has leaped inprice from 90 cents a gallon to $2.35 a gallonsince 2003 – an increase of more than 160 per cent. Many operators, like the much larger commercialairlines, have so far successfully hedged their costsby purchasing fuel on the forward market, butwith no end in sight to the relentless increase in

the price of oil,that strategy is oflimitedeffectiveness. Withthe winter sportsseason getting intofull swing inEurope and NorthAmerica – typicallya time of highdemand for aero-medical andsearch and rescueservices –helicopter andfixed-wingoperators arealready looking topass on theirdrasticallyincreasedoperating costs totheir insuranceindustry clients.This is not to saythat the future ofthe rotorcraftaero-medicalindustry is bleak.

On the contrary, demand for services remainsstrong in the developed and developing world.Manufacturers, too, are generally ahead of thecurve in bringing new, more economic equipmentto market, whether in the form of all-new aircraft

or fuel-efficientpower plants thatcan be retrofittedto olderhelicopters.However, that stillmeans substantialinvestment byoperatingcompanies.In some countries,including the UK,this should promptgovernments totake a fresh look atits approach to the

aero-medical sector. Historically, UK governmentshave left the provision of aero-medical services tocharities and private trusts – many of which arealready feeling the pinch of higher costs. Only inScotland, where remote island and highlandcommunities are seen as more urgently in need ofair ambulance services, are costs fully funded bythe government.Typical costs of providing aero-medical cover to anEnglish county such as Kent are at least £100,000per month (up almost 100 per cent since 2001)and there are limits to how deep charity donorscan be expected to dig to meet unforeseenincreases in operating costs.In the US, the federal Medicare programme capsthe costs and reimbursements that can be claimedfor aero-medical services, effectively limiting theamount that insurance companies can pay out toair ambulance operators on their clients’ behalf.That, too, may have to change or risk endangeringthe availability of such services, with operatorspotentially tempted to withdraw from the sectorto seek more profitable business elsewhere.

High cost of rescue services

AIR AMBULANCENEWS 21


In response to the increasing loss ofcommercial stretcher capabilities, Germanair ambulance operator Med Call hasadapted its fleet to help respond better tothe needs of the international repatriationmarket. A new standard cabin configuration meansthat both of Med Call’s aircraft – a Learjet35A and a Piper Cheyenne IIIA – areequipped with a lifeport double-stretchersystem, where both stretchers are placedin line behind each other. Thisconfiguration offers the chance to transferone intensive care and one non-intensivestretcher patient on the same flight.Additionally, another seated patient orcompanion can be transported. Michael Diefenbach, managing director of Med Call,says: “This cabin configuration in a Learjet 35A isunique in Europe.“ The company is aiming tocompensate for lost stretcher capabilities oncommercial airliners by carrying out more double ortriple air ambulances, and cost-saving as a result.With placing the stretchers behind each other, asopposed to beside each other, as is the norm, thecare level even for ventilated intensive care patientsis comparable to a single patient transport. Smallerair ambulances also offer greater time flexibility andshorter ground times than commercially carriedstretchers, by being able to use the closest airfieldsto the relevant hospital.

Med Call reacts toBA actions

PHI AirMedical is tobe thehelicopterproviderservice for anewinitiativerecentlylaunched byHospitalCorporationof America (HCA). Together, Medical Centre andHenrico Doctors’ Hospital have launched an airmedical system called SkySTATSM with the aim ofproviding fast, reliable and safe helicoptertransportation for patients from outlying areas whoneed advanced healthcare services. CJW and Henrico Doctors’ Hospital, along with theother HCA hospitals in the area, provide nearly 50per cent of all cardiac services and treatment ofstrokes in the Richmond Metropolitan area, thussuch a service is highly sought after. According toPatrick Farrell, HCA Richmond Market CEO: “It isimperative that these patients receive the fastest andbest care possible. We believe it is necessary for usto have an air transport service that will be availablefor these patients 24 hours a day, seven days aweek.” Initially SkySTAT will focus on transportingcardiac and stroke patients but will be able totransport time-sensitive patients if needed. Principalareas served will include Emporia, South Hill,Farmville, Northern Spotsylvania, Fredericksburg,Williamsburg, Tappahannock and Kilmarnock, US.

New air medicalsystem

A multitude of air medical programmes are activelyresponding to the disaster relief efforts in the Gulfregion, according to the Association of Air MedicalServices (AAMS). Both fixed wing and rotor wing areresponding to calls to assist federal and stateemergency management agencies.Emergency air transportation programmes fromsurrounding states have committed support staff andmaintenance crews to the ravaged areas in an attemptto maintain a long-term presence in the disaster zone.Numerous air-medical personnel, including flight crewand support personnel, have put themselves forwardfor aid assistance.Despite many logistical difficulties, which arechallenging flight operations, such as limited electricity,communications, ground support and access tofuelling stations, civilian air medical programmes havepersisted in working around the clock evacuatingpatients from local hospitals in areas hardest hit.Initial efforts were slow, leaving the air-medical care-critical services to be informal and primarily voluntary.According to the AAMS over 50 speciality medicalhelicopters and fixed-wing aircraft were available assoon as Hurricane Katrina moved through, but werenot deployed.As well as funds, an organised database of civilian air-medical resources was developed in a joint projectwith the National Highway Traffic SafetyAdministration, yet days into the catastrophe therewere still tremendous ongoing problems withcommand and control, communications, and fuelsupport for aircraft.Tom Judge, President of AAMS, said: “There is noreason for this level of confusion. We have hospitalsand state officials pleading for aircraft with specialitymedical teams and equipment, while other publicofficials are simultaneously cancelling the same aircraftin the air.”

AAMS praiseKatrina response

Central London’s only heliport may be reprievedwith the announcement that its owner, propertydeveloper Weston Homes, plans to build a businesshotel next to the site. Weston acquired the heliportin December 2003, prompting concerns that itwould be closed down and used for homes oroffice construction. Weston now sees the heliportas a key asset for its proposed hotel, according to aspokesman. The riverside helicopter is also a majorasset for the aero-medical sector, providing easyaccess to the very centre of the built-up capital.

Possible reprieve forLondon heliport

Have we been living in afool’s paradise? Not any

more than any other elementof the aviation industry indenial of the long-term

inevitability of substantialincreases in fuel prices

Worldwide, a billion passengers travel by air eachyear, their flights ranging from hour-long domesticjaunts to 10- or 15-hour transatlantic or cross-border flights. In 2004,MedAire’s Tempe, Arizona-based Global Response Centremanaged more than 13,000 in-flight commercial airline medicalemergencies, up 53 per centfrom the 8,500 calls recorded in2002.Vasovagal (fainting) episodesrepresented the largestpercentage of in-flightemergencies and is a conditioncaused by a drop in bloodpressure that is often triggeredby nausea, pain, fear, motionsickness or abdominal discomfortat altitude. While vasovagalincidents generally resolve inminutes, other common in-flightemergencies do not.More seriousrespiratory andgastrointestinalincidents, andneurological andcardiac events, needmuch greater care.A large percentage ofpassengers are fullyaware of their illnesses– as well as theirseverity –- beforeboarding the aircraft.Yet, they make the choice to travel, oftencompletely unaware of the impact of altitude ontheir chronic conditions. In many instances, theyexpect the airline to provide the same standards ofmedical care they would find in a metropolitan cityhospital. Who might pay for such medicalintervention is a question rarely considered.By default, airlines have stepped in to fill this role inan effort to ensure the safety of their passengers,absorbing the majority of costs associated withtreating an increasingly ill population of passengers.What we’re seeing is an older, less healthypopulation – more dependent on oxygen andprescription medications – choosing air travel as apreferred method of transportation.

Financial threatThis trend dramatically increases the risk of amedical diversion for aircraft – and represents apotential financial threat to the commercial airline. Itis thought that medical diversions can cost an airline

between US$50,000 and more than a US$1million, depending on the stage of flight, the amountof fuel that has to be released before landing, the

cost of passenger re-ticketing, landing fees,unexpected employeeaccommodations and a hostof other factors. Add to thatthe purchase of medicalsupplies and equipment andtraining for aircraft crews foran expensive service.By law, US airlines mustcarry medical kits that arecompliant with FederalAviation Administrationregulations, as well asautomated externaldefibrillators (AEDs). Theyalso must provide CPR/AEDmedical training to flightcrew. Similar regulations and

legislation exists inother countries,but is rarelystandard fromnation to nation.Even in the US,standards vary.Some airlinescarry medical kitswith contents thatexceed regulationstandards; depthof crew medicaltraining varies

among airlines; and protocol for handling ill/injuredcustomers onboard and on the ground also varies.Some airlines rely on medical volunteers to stepforward in a medical emergency, while others haveflight crew who are medically trained. Ananonymous survey of MedAire’s international,national and regional commercial airline clientsrevealed significant variation in their policies forhandling passengers once they are deplaned in aforeign country for a medical emergency. Oneairline reported that medical assistance is left to theairport handling agents to organise; anotherindicated that they continue to provide assistance ingetting the individual to the hospital; others rely onMedAire for co-ordination; and others providecontact numbers so customers can re-book whenthey are able to travel again. Given the increase in in-flight illness, variations inmedical protocol and assistance from country tocountry, as well as the exorbitant costs of medicaldiversions, should travellers take responsibility for

their own travel andmedical insurance?Should the airlinecontinue to shoulder theresponsibility or shouldsuch insurance becompulsory?

Lack of supportThe airline responsefrom the anonymoussurvey may be surprisingto many. Despite thecosts and resourcesassociated with providingin-flight medical care anddiversion fees, fewerthan half of the

respondents –representing 20 percent of MedAire’scommercialcustomer-base –said they wouldsupport compulsorytravel insurance.One internationalairline said itprobably wouldn’tsupport such amandate because of‘the economicclimate ofcustomers, who areshopping for thelowest, leastrestrictive fares’.In the US market,carriers are alreadycollecting passengerfacility charges andsecurity surchargesfor the government– charges thatsignificantly impactthe end fare and thepassenger’swillingness topurchase tickets. Assuch, the currentemphasis appears tobe on getting thepassenger safelyfrom point A topoint B, whilespending the leastamount of moneydoing so, andcharging themaximum a passenger is willing to pay.That may change, however. As airlines continue toseek ways to control rising operational costs, theywill be looking for more ways to mitigate their ownfinancial risk, including the risk associated withdiversions related to medical incidents. Carrying ahealthier public – or a public responsible for its ownmedical travel insurance – could translate to loweroperational costs and less financial risk to the airline.It is also probable that passengers may seedisclaimers from the airlines in the future, indicatingthat those with certain illnesses travellingcommercially must meet fit-to-fly medical standards,or be responsible for their own medical expenses inthe event of emergency.New US legislation being considered under FederalAviation Regulation 106 may add an additionalburden to the airlines. Under this proposedlegislation, even morepeople with chronicillness will take to theair.Our survey revealedthat only a handful ofairlines currently offertravel insurance topassengers – generallythrough telephone,travel agents andreferral. Legislation ofthis nature may changethese statistics. Onething is certain: a single,blanket insuranceproduct will not cover all possible travel-relatedevents. Travel insurance will have to be managed,taking into consideration a person’s destination, hishealth and the risk of the activities in which heparticipates. There will be much more to travelinsurance for commercial airline passengers thansimply selling insurance and having people insured.

What next?Compulsory insurance may not be the answer

today, but it is a real possibility in the future. Whatwe can do is educate the public and encouragethem to take responsibility for their own well being.It shouldn’t be the airline’s responsibility to providefree, premier-level medical care to passengers whodon’t accept responsibility for their own healthconditions.Yes, airlines should be prepared to help in the eventof emergencies, which they have taken great painsto do, but the passenger must also take someresponsibility for their actions.If I’m a person with atherosclerosis (narrowing orblocking of the arteries) and I want to travel, I needto understand that there is a certain risk involved. If I’m well-educated and aware of the option topurchase insurance, I can always make a well-informed decision.The cost of travel insurance will far outweigh the

cost of a medicaldiversion – anexpense thatsome day couldbecome the illpassenger’sresponsibility.Insurance can alsoalleviate the fearassociated withobtaining medicalcare in a foreigncountry, shouldthe need arise.We must continueto educate the

public about the impacts of altitude on the body, thevarying medical care standards from country tocountry, and the importance of pre-travelpreparation, such as pre-arrangement of oxygenneeds and the importance of packing and handlingprescriptions. Through articles in in-flight magazines,international publicity, videos displayed on theaircraft and crew-member training, airlines andmedical and security care providers can ensure thatpassengers receive the best care possible in the airand onshore, locally and abroad.

Should travel insurance be compulsory?


FEATURE22

While their destinations, countries of origin and trip lengths may vary,

today’s travellers do share many similarities: they travel by air more

frequently, they’re older, they take longer flights to more exotic

locations, and their health is often compromised before they get step

foot on an aircraft. Joan Sullivan Garrett analyses the market

Airlines have stepped in to fillthis role in an effort to ensure

the safety of theirpassengers, absorbing themajority of costs associated

with treating an increasingly illpopulation of passengers

It shouldn't be the airline'sresponsibility to provide free,premier-level medical care to

passengers who don'taccept responsibility for their

own health conditions

THERE IS LIGHT ON THE HORIZON

> worldwide AIR AMBULANCE OPERATOR> worldwide REPATRIATION & MEDEVAC> worldwide AIRLINE STRETCHER SERVICE> worldwide MEDICAL AIRLINE ESCORTS> worldwide BED-2-BED TRANSPORTS> PERSONAL MEDICAL CONSULTANCY

24 / 7 available for those in need!Tel: +43 699 1570 1570based in: VIENNA (LOWW/VIE), AUSTRIA

www. medicaljetservice.com

To its friends the rugged offshore island ofTaiwan, once known as Formosa and nowofficially called The Republic of China, is abeacon of democracy and a spearhead ofthe economic boom that has transformedAsia – despite some recent hiccups.While some see the future as an inevitablereintegration with the mainland, hopefullyon a semi-independent basis of the kindenjoyed by Hong Kong and Macao, othersbelieve Taiwan is already a de facto fullyindependent state and is best left that way.Significantly, where official policy once heldthat Taiwan was home to a Chinesegovernment in exile fromits legitimate base inBeijing, today there is anequally strong feeling thatTaiwan should be anindependent country in itsown right. The consensuson the island is that,whatever the choice, thedeciding voice in thedecision must be theTaiwanese peoplethemselves.Inevitably, such an enigmaleads to regional tension,which explains compulsorynational service and a largestanding army. However,with every passing yearsince the nationalistChinese forces fled thereunder their charismatic and controversiallate leader Chang Kai Chek along with twomillion supporters of his Kuomintung partyin 1949, in the wake of Communist victoryin the Chinese civil war, the likelihood ofarmed conflict has receded.At that point, Taiwan had been reintegratedinto the Chinese state for less than fouryears, having been ceded to Japan followinga humiliating military defeat way back in1895.Military service in Taiwan has beencompulsory for men aged between 19 and40 but that upper limit has this year beenlowered to 35, reflecting today’s lessnervous times, though expenditure on thearmed forces is a substantial US$7.574

billion, with nearly six million men available formilitary service if needed.

New trading blocRecent moves to make it easier for tourists andbusiness people to fly without problems betweenthe two Chinas, be it for business, pleasure or to visitrelations, augers well for a future of ever increasingaccommodation.In the meantime, Taiwan’s vice president, Lu Hsui-Lien, has been devoting her energies to the creationof a Democratic Pacific Union that will unite easterndemocracies on an equal basis and effectively be aFar East version of the EU trading bloc.

This organisation of equalpartners is significantly beingborn on the 60th anniversaryof the end of the SecondWorld War, an event whichsaw the end of Japan’sambitions to create a GreaterEast Asian Co-ProsperitySphere on the hegemonicbasis of one nation imposingits will on others.So far, despite lack ofinternational recognition,Taiwan has been doing prettywell standing on its own. Setoff the south eastern coast ofmainland China, to the northof the Philippines, the 32,260sq kilometre territory, whichalso includes the heavilyfortified smaller islands of

Quernoy, Matsu and the Pescadores, is two-thirdsrugged mountains – with a high spot of 3,952metres at the summit of Yu Shan – to the east, andgently rolling plains in the west. Its capital is thebustling city of Taipei.The island has small deposits of coal, natural gas,limestone, marble and asbestos. While 24 per centof the land is in use for arable farming – with flowergrowing a major enterprise – it is manufacturing andthe service sector that have been the driving forcesbehind the prosperity now enjoyed by a 22,894,384population that has a median age of 34 and a lifeexpectancy of 80.28 years for women and 74.9years for men, reflecting the good standard of living.Today, agriculture contributes less than two per centto GDP, down from 32 per cent in 1952.Once a dictatorship, Taiwan has had a democratically


WORLDMARKETS24

To the mainland Chinese, Taiwan is the tantalisinglost province. Roger St Pierre explores theisland’s economy and its insurance sector

The other China

elected government since 2000, with theDemocratic Progressive Party currently holdingpower and the Kuomintung party as the mainopposition.Business has become increasingly free-market instyle, with ever decreasing government interventionin the capitalist system. For years, the US, which,while never officially recognising Taiwan’s status, hasbeen a solid friend and a deterrent to any invasionfrom the mainland, was Taiwan’s number one tradingpartner. But in recent times China has become itsmajor export market, representing 37 per cent in2004, followed by the US on 16 per cent and Japanwith 7.7 per cent.

Long-term growthThanks to a conservative fiscal approach and innateentrepreneurial strengths, Taiwan comfortably rodeout the Asian financial crisis of 1998. However, theglobal economic downturn of 2001, plus a run ofmajor financial failures, created the island’s first everyear of negative economic growth.Despite this, Taiwan has continued to enjoy asubstantial trade surplus and today holds the world’sthird largest financial reserves, currently standing atmore than US$246 billion. While not exactlybooming any more, the economy continues to showevery sign of long-term growth, especially as thebusiness ties with mainland China become everstronger.Reflecting the nation’s strength are the figures ofnearly 15 million mobile phones and in excess of 13million Internet users. The freedoms brought by theInternet have their downside, but Taiwan has been atthe forefront in providing data security and its PKI(Public Key Infrastructure) mechanism is one of themost effective information security defence measuresso far introduced. However, it is so far employed byonly five per cent of Taiwanese insurance companies.Internet usage in the insurance industry has longsince reached 100 per cent and today the industry isthe front-runner in providing product and/or serviceinformation online, at an impressive 90 per cent.Some 86 per cent of all companies engaged in theinsurance sector are large enterprises with morethan 50 employees each. It is very much a growthbusiness, with a mix of locally and foreign ownedcompanies. Key players include An Tai InsuranceCompany, Kuo Hua Insurance Company, ZurichInsurance and Chung Kuo Insurance.The insurance market has been opened up forforeign investors, with 21 of the 55 insurancecompanies that presently operate in Taiwan beingforeign owned.Other measures taken toliberalise the insurancemarket include therelaxing of restrictions onthe approval ofcommodities; liberalisedrates, investment policiesand procedures; theopening of cross-straitinsurance exchanges;information disclosuresystems and thepromotion of risk-basedcapital systems. Foreign-owned insurancecompanies operating inTaiwan are closelymonitored to ensure theycomply with localregulations, includingemployment laws, andthis provides a levelplaying field for faircompetition between incomers and local companies.All this gives Taiwan the clear potential to becomethe acknowledged Asian insurance market hub in theyears to come.

Mass migrationThe current mass migration of global industries tothe Far East is working very much in Taiwan’s favour.The workforce is well educated and highly literate,with a large pool of persons experienced in everyaspect of the financial sector. Economic growth iscurrently running at around 4.5 per cent.Travel is becoming an ever more important elementof the mix. Taiwan has some 40 commercial airports

and mainland China ishopefully set to be the keydestination and the hopedfor source of inbound traffictoo.“We are willing to open thedoor ever wider formainland Chinese citizenswishing to make sightseeingtrips to the island,” saysTaiwan’s president, ChenSui-bian. “However, it is stilldifficult for mainlanders toget permission from theauthorities in Beijing tomake such trips. Wesincerely hope that themainland authorities will beable to see their way tomaking a goodwill responseto our ‘open door’ appeal. Ihave directed our relevantgovernment agencies tocontinue to consult with themainland authorities on theissue, based on the principleof openness.”Added the president’s chiefof staff, Chiou I-jen:“Mainland China still lists Taiwan as an off-limits areafor its people who want to make leisure tripsoverseas. If China will lift its ban, Taiwan will have itsdoors wide open for mainland tourists. The cabinet-level Mainland Affairs Council has worked out manycomplimentary measures in preparation for mainlandChina’s deregulation of travel.”What local travel agents would most like to see is forordinary mainland citizens to be able to travel toTaiwan via either Hing Kong or Macau for sightseeingpurposes. Except for a few specific groups of people,such as those in the military, we would like theborders to become open for leisure travellers.”Such a development would obviously impactfavourably on the travel insurance industry. Even ifthere is a limited quota, and talk is of this being set at350,000 visitors a year, the recession-hit local touristindustry would feel the benefit and there is everyreason that the traffic would quickly become two-way.Mainland officials have indicated that suchliberalisation will first depend on the drafting of a bi-partisan agreement on issues regarding travelinsurance, visa processing, travel accidents, travel

disputes and the return ofoverstaying visitors.Taiwanese officials havealready given a favourableresponse to a mainlandproposal to ease the waytowards establishing directtransport links with themainland. In a recent interview,China’s vice premier QianQichen suggested thattransport links could bedescribed as ‘cross-strait’rather than ‘domestic’, toavoid upsetting Taiwanesesensibilities oversovereignty.Comments Taiwan’stransport minister, Lin Lin-san: “I think labelling suchservices as cross-straitroutes is a positiveconcept. It is welcome

progress.” Currently, Taiwan’s cabinet is in the midst of anintensive internal discussion on how to re-opendirect transport, trade and postal services and is dueto complete its review of the issue by November.Taiwan has already removed limits on mainlandinvestment by Taiwanese companies and allowedthem to invest direct rather than via a third partycountry. It has also eased restrictions on mainlandinvestment by businesses within the semi-conductorindustry that is the backbone of Taiwan’s economy.Visitor numbers from elsewhere are already up,rising by 26.3 per cent last year after the 24.5 percent drop in 2003 due to the SARS outbreak.

Outbound tourism has also seen a partial recovery,with numbers of departures increasing to 6.9 millionin 2004, a 16.5 per cent increase over the 2003figures but still six per cent less than in 2002.The introduction of a two-day weekend and a useful‘Civil Travel Card’ have fuelled a sales growth in thedomestic tourism industry and this has led to anincrease in the underwriting of travel insurancepolicies.The Internet and its role as a comprehensiveinformation provider for all travel needs, includingbooking and purchasing for such things as traveltickets, accommodation bookings and travelinsurance, has become increasingly key.Thanks to increased competition for outbound

business and a rise in incoming traffic, the trade gapin tourism payments has narrowed considerably, buta mix of political instability and natural disasters, pluscivil unrest following a bitterly fought presidentialelection in early 2004, have all had a negativeimpact. 2003 saw huge vacancy levels due to theSARS scare, while a devastating typhoon in the thirdquarter saw occupancies drop to a disastrous 20 percent level in the affected areas.Once a low-key business, tourism is becomingincreasingly important in Taiwan and steadilyincreasing infrastructure investment will continue togrow the market for both business and leisuretourism and the accompanying travel insurancebusiness.


WORLDMARKETS 25

There is little doubt society is becoming morelitigious. The general public are now betterinformed, know their rights and have little hesitationexercising them. In the UK at least, we are gearedto encouraging claims as solicitors cultivate claims viaclaims farmers and insurers sell policies with legalexpenses insurance.The flood of claims will not be stemmed, so it isessential for insurers to know their stuff. They mustensure their claims handlers, and the solicitors theyappoint, know all the loopholes, otherwise they willpay for it. Not only are insurers paying out onclaims when it is unnecessary, but they areoverpaying too.The travel team at Penningtons Solicitors LLP(Penningtons) has recovered damages from insurerson UK levels when they should have been atFrench levels (about half the amount) and havebeen paid costs that need not have been paid. Thiswas simply down to the liability insurers and theirhandlers not knowing some basic facts about how

to defend claims arising from jurisdictions outsidethe UK.Perhaps I should not be too harsh on insurers, asmost of these claims do read like an exam question.A typical example would be the case of the Englishpassenger in a hire car in Portugal, driven by herEnglish friend, which had an accident with anotherhire car driven by an Italian. The questions the insurer should be asking aresimple, even though the answers might not be:• In which jurisdiction(s) can the claim be brought?• What is the applicable law?• How much should be paid in damages and costs?• Are there any practical considerations?

JurisdictionThe UK insurer is faced with a claim for damagesfrom an injured third party, brought against theirinsured, typically arising out of some act ofnegligence committed by the insured abroad.The first issue to address is whether the English

court has jurisdiction over the claim, in other wordscan your insured be sued in the English courts? Thegeneral rule is that defendants are entitled to besued in the courts of the country where they arehabitually resident. This extends to cases where thedefendant is one of multiple potential defendants,even if they are habitually resident elsewhere.However, one important point frequentlyoverlooked by insurers and their advisers, is that theEnglish courts will not allow parallel actions. Ifproceedings have already been issued in anotherjurisdiction, the English courts will refuse to dealwith the claim.The UK insurer must be able to establish whetherforeign proceedings have been issued, which isfrequently the case with motor accidents where theforeign insurers issue proceedings for recovery oftheir outlay. If they have, the UK insurer canredirect theclaimant to theforeign jurisdictionor elect to dealwith the claim onthe basis of theforeign law. Asdamages abroadare generally farlower than inEngland and costsare not usuallypayable, significantsavings can bemade.I am currentlydefending anaction brought bya son against hisfather as a result of a serious road traffic accident inSpain. The son’s solicitors are oblivious to the factthat the occupants of the other vehicle involvedhave included a claim for their civil damages withinthe current Spanish criminal proceedings; an alienconcept for UK solicitors. It is open to me to arguethat civil proceedings have already been issued inSpain, thus precluding the son issuing in England andthereby ensuring the son brings his claim in Spain,potentially saving my insurer client hundreds ofthousands of pounds.Furthermore, the rule of thumb when it comes tolimitation is the foreign limitation date will be theone applied. This is important when dealing with

one-year limitation dates, no differing dates forminors and so forth.

What law applies?The general rule is that the law applicable todetermine the issues arising in a claim are the lawsof the country where the accident occurred. Thisrule applies to matters of substance. Therefore,where a claim can be brought in England, but arisesfrom an accident abroad, it is the laws of thecountry where the accident occurred that willdetermine issues such as liability, actionability,defences, contributory negligence, duty to mitigateloss, remoteness and available heads of damage.This must be distinguished from matters ofprocedure, which will be governed by the laws,rules and practices of the courts of England. Mattersof procedure have been deemed to include

admissibility ofevidence, thequantification ofindividual heads ofdamage, periodicpayments, theability to return tocourt for furtherdamages if theclaimant’sconditiondeteriorates, andthe deduction ofsocial securitybenefits. However,while this isrelativelystraightforward,this general rule

can be displaced if the court is satisfied that it is‘substantially’ more appropriate for another law tobe applied. Typically this could happen where bothclaimant and defendant are British. The indicationsare that the courts are hardening in their willingnessto displace the general rule.

How much should be paid?With liability claims, an insurer can readily makemore accurate reserves if it knows the potential fullextent of any claim. Knowledge of damages andcosts recoverability avoids expensive mistakes.The question of how much to pay in damages isdependant on which country’s laws the English

Liability claimsFaced with increasing numbers of travel-related claims, what can liabilty insurersdo to manage them more effectively? Whyare they paying too much and how canthey better control what they pay? CostasAndrea looks for the answers in part twoof our company liability investigation


FEATURE26

Insurers must be prepared tochallenge convention and take

a lead in this new anddeveloping area of the law.Only by doing so will the

current ambiguities be ironedout and meaningful precedentsset for the benefit of the travelinsurance industry as a whole

court applies. In practical terms, this is fertile groundfor liability insurers to make huge potential savings orto suffer significant losses. The important point tonote here, if a foreign law isfound to apply to a case, isthat the foreign law will applyto determine what heads ofdamage are recoverable, butEnglish law will apply toassess the amount of thosedamages.A couple of years ago, Iwas presenting a claimthrough the Englishcourts, on the basisthat Spanish lawapplied. WhilstSpanish law wouldhave greatly assistedme in establishing blame, Ihad a huge potential problem when ittranspired that Spanish law did notrecognise my claim for the cost of futurecare. This part of the claim was wortharound £500,000 and, simply byasking the defendants, all partiesagreed to English law applying in thiscase. Despite my job in attaching blamebeing more difficult, the solicitors appointed by theeight English defendants clearly wanted an easy lifeand either did not bother researching the point ordid not know how to go about it. As a result, theycost their insurer client £500,000. This casedemonstrates that if a particular head of damage isnot recognised by a foreign law, it will not berecoverable even if the proceedings can be anchoredin England.The Court of Appeal has recently decided, in a case

where Australian law was held to apply, that limits oninsurance coverage applicable in Australia must also

be used to cap the damages the English courtcould award.

If any proceedings canrightly be anchored inEngland, if the claimantwins, he will be awardedhis costs. Costs will onlybe a live issue for thosemotor insurers dealingwith foreign claims onbehalf of other EUinsurers. Under whatis known as the

Fourth Directive,any insurer withinthe EU musthave arepresentative inall othermember states.This enables

claimants tonegotiate with an insurer/claims

handler in their home state, even if theaccident occurred elsewhere. A simple

enough concept, but why then do insurersrepeatedly negotiate settlement of such claims on thebasis of English law? The laws of the country wherethe accident happened will apply to determineliability, damages and costs. The general rule I advisemy clients is that they should assume no costs arerecoverable abroad.

Practical considerationsThe importance of expertise in this area of the lawcannot be stressed enough and the essential

elements of such claims for an insurer must beaddressed as soon as practicable. The insurerdefending such claims must have answers asquickly and as cheaply as possible, irrespective ofwhere an accident may have occurred. They musthave confidence that their claims handlers havecovered all options, so the insurer can makeinformed decisions. To do otherwise costs theinsurer money. They are already paying for theirclaims to be handled, so they need to be handledproperly, with payments made only whenproperly incurred and presented.By way of example, I am currently defending aclaim brought by a Belgian national against anEnglishman over an accident in France. France orEngland is the only jurisdictions open to thisclaimant, but she has issued proceedings inBelgium. Rather than challenge jurisdiction, myinsurer client has agreed to allow the claim to runin Belgium, as they will ultimately end up payingless in damages and costs than had the claimantcorrectly issued in France or England.A different slant on this is in the case of fatalities.Most Mediterranean countries award significantdamages for fatalities, whereas in Englandbereavement awards are limited to £10,000, butonly where there are dependants. If defending afatality claim which arose in, say, Greece or Spain,do not be tempted to deflect jurisdiction away

from England, as it will probably cost you more.This article has aimedto highlight theessential differencesbetween the pursuit ofclaims in the UK andelsewhere in theworld. My objectivehas been to provide aninsight into why suchclaims must, out of necessity, be handled in a totallyunique way and why each claim is different because

each is fact sensitive. Being competent at defendingpersonal injury claims in the UK isof very little use when dealingwith actions when the accidenthappened abroad.Insurers must be prepared tochallenge convention and take alead in this new and developingarea of the law. Only by doing sowill the current ambiguities be

ironed out and meaningful precedents set for thebenefit of the travel insurance industry as a whole.


FEATURE 27

Knowledge ofdamages and costsrecoverability avoidsexpensive mistakes

Each year, millions of young people travel to foreigncountries – many as participants of sponsored work,travel or study-abroad programmes. Some attendhigh school or college for a semester or an academicyear in another country; others embark on adventuretours and wilderness treks; even more travel for acultural work experience. One of the most popular programmes involves youngpeople working as au pairs and living for a year withforeign host families while providing care for theirchildren. Some participants in these programmestravel from one European country to another, butmore often they go from Eastern Europe anddeveloping countries to Western Europe, the US andCanada. Many other young people travel to the USfor summer and other work programmes – resortsand summer camps provide thousands of theseyoung people with foreign work experience and ataste of life in the US. Because programme participants are required to havemedical as well as evac/repat coverage, theseprogrammes form a significant market for the travelinsurance industry. The rapid growth of these youthtravel programmes has led to the establishment ofseveral industry-wide professional and networkingorganisations: Language programmes have ALTO(Association of Language Travel Organizations);

GWEA (Global Work Experience Association)represents camp, resort, study abroad and assortedprogrammes; and IAPA is the International Au PairAssociation. The Federation of International YouthTravel Organizations (FIYTO) bands these associationstogether. Our legal hotline receives crisis calls whenprogramme participants encounter legal problemsduring their stay. Experience reveals that programme-travellers who are involved in short, focused stays orclosely supervised programmes rarely face criminalcharges. Participants in programmes with professionalguides, as are found in trekking and adventure typeexperiences, are typically too exhausted and isolatedto get into legal problems. However, school-age travellers are significantly morelikely to suffer accidental injury than older travellers. Inone unusual case, a teenaged study-abroad studentjoined her US high school’s cheerleading squad.While performing a routine, she crashed into ateammate and suffered severe orthopedic injuries.We referred her to our local attorney who was ableto obtain a financial settlement for her, and a partialrepayment of her travel insurance company’s costs. Another youth accident case involved a foreignworker in the US who fell three stories from the roofwhere he was sleeping. His blood alcohol level wasthree times what is required for a DUI (DrivingUnder the Influence) conviction. The travel insurancecompany asked for our help in determining whetherits policy’s intoxication exclusion could provide a legaljustification for denying the catastrophic claim. Wearranged for the services of a toxicologist and anaccident reconstruction expert. Their findings clearlyestablished that alcohol intoxication was a significantfactor in the accident.Participants in longer-term programmes, especiallythose not closely or professionally supervised, aremore frequently involved in criminal law violations.Long-term workers, including au pairs, (especiallythose from Eastern Europe), are arrested forshoplifting-retail theft offenses more often than otheryouth travellers. Drug offenses are relatively rare,even in long-term programmes, but alcohol oftenfuels criminally irresponsible behavior. Resort workersand others sometimes become involved in fights andother dangerous activities as a result of excessiveconsumption of alcoholic beverages. The typical resultis a disorderly conduct arrest. Consumption of alcoholic beverages by minorssometimes results in arrests or citations for youngerprogramme participants, especially now that all USstates have a minimum drinking age of 21. This is incontrast with Europe and most of the rest of theworld, where age limits are often absent. However, our most common calls are about trafficviolations, and drink driving. Au pairs, many of whomdrive as part of their work duties, are often amongthose arrested for DUI offences. Within the pastseveral months, we have received eight calls to assistau pairs charged with DUI. Some au pairs consulttheir friends in an attempt to calculate how manyalcoholic drinks they can consume and remain belowthe legal blood alcohol levels. Some miscalculate andare arrested. With the exception of underage drinkingcharges, high school students living abroad with a localhost family rarely have criminal problems.One thing is for sure; it is essential to alert foreignprogramme participants to the differences in foreignlaws and customs, and the importance of avoidingentanglement in a foreign criminal justice system. It isalso crucial for sponsoring programmes to be readyto recommend competent legal assistance whenevera criminal or civil legal problem arises.

The number of school and university students embarking ontrips to foreign shores, for study or to experience anothercountry, has increased greatly over the last decade. DickAtkins explains the common travel insurance pitfalls facingyoung programme-travellers abroad

The sponsored youthtravel market

China: Cell phones andsocial unrestChina’s reputation as a country free from strife ischanging, as protests and riots become the normrather the exception. ijet Risk Managementreports on the rising violence in China, said to befuelled, to a certain degree, by the development incommunication technology

Angry with local officials, a mob of 10,000 peoplerioted in the Chinese city of Chizhou on 26 June,burning police cars, stoning riot police and looting asupermarket. The riot was touched off by aperception that local officials were showingpreferential treatment toward a well-to-dobusinessman whose car had collided with a localbicyclist.Though the Chizhou riot may clash with Westernperceptions of a repressed and orderly China, itwas hardly an isolatedincident – statisticsshow civil unrest isrising countrywide.There is a growingbelief that governmentofficials are corrupt orfavor China’s growingwealthy class.Increasingly,technology is playingan important role inthe protests. InChizhou (a city of125,000approximately 400kilometres/250 milessouthwest ofShanghai) for example,the mob grew larger because people used cellphones to spread word of a growing confrontationwith authorities.

Sources of discontentThe majority of grievances are linked to China’sshift to a market-oriented economy over the past25 years and the accompanying rapid economicgrowth. China’s economic expansion has led to asizable urban-rural wealth gap and a new wealthyclass that many of the economically marginalisedfeel has prospered at their expense. Another issue, is a perception that local andprovincial party officials are corrupt. In nearly everypublished account of social demonstration,protesters vented frustration with what they viewedas corrupt officials colluding with business entitiesfor personal gain, pocketing public funds or refusingto act on the local population’s grievances. According to figures recently released by theChinese Ministry of Public Security (MPS), thenumber of ‘mass incidents’ – a catchall phrasereferring to protests, demonstrations, riots andstrikes – rose to 74,000 in 2004. The 2004 figurerepresents an increase of nearly 28 per cent over2003, which saw 58,000 mass incidents accordingto MPS information. The increase is not a one-yearanomaly; it is the continuation of a decade-longtrend that has seen the number of incidents risefrom 10,000 in 1994. The number of participantshas skyrocketed from 730,000 in 1994 to 3.76million in 2004. It is unlikely that localised rural demonstrations posean immediate threat to the stability of the centralgovernment. But, the communist leadershipappears to view the rising social unrest as apotential future threat, especially if left unchecked.

One area of concern for Beijing is the role mobilephones – like those seen in Chizhou – will play inthe future.

The role of information technologyOver the past five years, mobile communicationshave revolutionised protests and demonstrationsthroughout the world, not only as a facilitator of theincreased flow of ideas and information, but also asan organisation tool. The use of short messageservice (SMS) over mobile phone networks allowsprotest organisers to rapidly co-ordinate and modifydemonstration plans.Mobile phones have also played a vital role inorganising large-scale protests and spreadingsuppressed information in China. Rural protestershave been increasingly using SMS and mobile

phones to organise demonstrations and alert fellowvillagers of flash-point incidents. China hasapproximately 350 million mobile phonesubscribers (by far the most in the world), andsome telecommunications analysts believe thatfigure will likely swell to 580 million users by 2010.It is likely that a large number of the predicted newsubscribers will come from rural regions.The government has already taken steps to monitorand disrupt information transferred via SMS. In2004, the Chinese government began to monitortext messages using a system that can blockmessages containing selected words or phrases (i.e.‘anti-Japan protests’). While the governmentcontends this measure was established tocounteract pornography and the spread of falseinformation, many believe that political dissidentsare the real target.It is also not unreasonable to consider the possibilityof the system being used to further economicespionage, already a major concern of foreignbusinesses operating in China. It is estimated thatChina has approximately 2,800 SMS monitoringstations throughout the country, although it isunknown how many personnel service the stations.Despite this monitoring and blocking apparatus,many have noted that it appears to be a losingbattle for the central government – citizens arefinding new ways to circumvent the government’stechnological controls and the number of users israpidly increasing. It is certainly important forbusinesses, operating in China, to be aware of theincreasing role that mobile technology will likely playin facilitating social unrest and the potentialgovernment reactions to this evolving socio-politicallandscape.

DICK’SHOTLINE / HOTSPOTS28



PROFILE 29

A life less ordinary

Full name: Nicolas Keglevich

Job title: Director

Company: Assist-Card International

Where were you born? Budapest, Hungary

Where were you educated? Primary: EcoleMoyenne de Rochefort, Belgium. High: ColegioDas Dores, Porto Alegre, Brazil

What was your first job and what was your worstjob? My first job was in 1959 as an activator ofproviders of spare parts for Industrias KaiserArgentina (IKA), a car assembly company. All myjobs had something positive to them and I can’tremember anything bad.

How did you findyourself in theassistanceindustry? After IKAI worked for an oilcompany in thesouth of Argentina(1961), then as asalesman in a FIATdealership inBuenos Aires(1962/4), then as asales executive forInvestors OverseasServices, first in Argentina and then in Spain(1964/9). From Spain I went to Switzerland, whereI started working for the Banque Exel as investmentmanager for South America. This meant lots oftravel within that continent, which helped me todeeply know the Latin American market. The Bankhad interests in France Secours International (FSI), acompany that helped and assisted French travellers.In 1969 I was given the representation of FSI forLatin America. In 1971, I co-founded Assist-CardInternational with Roger de Vernisy in Geneva. In1972 I returned to Buenos Aires, where I havebeen living ever since.

Tell us a little bit about your company. Assist-Cardwas created in 1971 to meet the needs of providehelp in any emergency to travellers in their own

language. Headquartered inGeneva, Switzerland, thecompany started operationsthrough an alliance with GESA-General Europea S.A., aninsurance company created in1953 with head offices inBarcelona and branches inParis, London, Milan andBrussels. Relying on thisinfrastructure Assist-Carddeveloped tailor-made

assistance services for travellers. Through anotheralliance with the Cross Country Motor Club ofBoston, Massachusetts, in 1978, Assist-Cardexpanded its services throughout the US. By 1979we had sales offices in France, the US, Argentina,Colombia, Brazil, Chile, Uruguay and South Africa.Assist-Card separated from GESA in 1981 anddeveloped its own full-service operation in all of itsoffices. Since then, we have become the largestassistance service network in the world.

How do you see the future of travel insurance/assistance markets? I see it as very promissory,based on the fact that every year there is anincrease of travellers around the world, to new andundeveloped destinations, thus in need of assistanceservices.

What has been your greatest achievement(career/personal)?The development ofa unique concept inassistance totravellers. I created aconcept and adifferent approach forthe marketing of thatconcept. Thedifference made itsuccessful in dozensof countries aroundthe world.

What is the secret of your success? Two things.Dream and then make it happen. Perseverance.

What is your guiding philosophy or principalregarding your work ethic/life ethic? Be honest asit pays.

How do you prioritise your time? Workweekdays. Never, but NEVER, work on weekendsor at home.

How would you describe yourself? Creative,passionate and curious. A go-getter.

Can you tell us about your family? I am married toMaría. I have two daughters, Flavia and Alexia, and ason, Maximilian, from previous marriages. So far, I

have five lovely grandchildren.

What are your future career/life plans? ExpandASSIST-CARD in Asia. Less working and moreexercising and more travelling to undevelopeddestinations.

What do you do whenyou are notworking/what are yourhobbies? I like toentertain with friendsand family. My hobbiesare yachting and classiccar racing.

Where do you live? I have two beautifulapartments. One is in Miami and the other is inBuenos Aires.

What is you favorite holiday destination?The world.

If you could be in any other profession, whatwould it be? Professional car racing.

What’s your favorite drink/ meal?Champagne/oysters.

Who do you most admire? My family.

Who is your heroine? My secretary!

What would be your epitaph? Here lies NK, ateacher and a leader. His talent helped thousands.And he enjoyed life.

I created a concept and adifferent approach for themarketing of that concept.

The difference made itsuccessful in dozens of

countries around the world

I see the market as very promissory.Every year there is an increase of

travellers around the world, to new andundeveloped destinations, in need of

assistance services

NICOLAS KEGLEVICH, co-founder and director of Assist-Card International, haslived an extraordinary life. His early days read like a script for Casablanca and theSound of Music rolled into one. He was born into a wealthy Hungarian noble familyin 1939. At the end of World War Two, aged five, he was forced to flee theadvancing Red Army. Along with his sister, he was smuggled out of Hungary in 1944as orphaned refugees by their nanny and lived with her in Belgium. A year later theirfather, who had walked across the mountains to escape the Russian onslaught, joinedthem. His mother was not so lucky. Working as a nurse in a field hospital, she caughttyphoid fever and was left for dead. Shipped to Germany she subsequentlyrecovered and went to work in Paris, with no idea of her family’s whereabouts. Fouryears later Nick’s father made a speculative visit to Paris to find her and, by chance,met an old friend who knew where to find her. Nick’s family then emigrated toBrazil, where he finished school. Later he travelled to Argentina for his first job, andthen Spain and Switzerland, before returning to Buenos Aires in 1971.


SERVICEDIRECTORY 30 To have your company listed in the Service Directory email: [email protected]

Luxembourg Air Ambulance Andy Breeden – Operations

175A, rue de Cessange [email protected] www.air-ambulance.luLUXEMBOURG Tel (24 hr): +352 420 440 1

Fax: +352 420 440 366

Med Call GmbH Michael Diefenbach – CEO

Bahnhofstrasse 22 [email protected] www.medcallgmbh.comWiesbaden Tel: +49 611 9310 310GERMANY Fax: +49 611 9310 311

Medic’Air International Dr Herve Raffin – General Manager

35 Rue Jules Ferry [email protected] Bagnolet www.medic-air.comParis Tel: +33 1 4172 1414FRANCE Fax: +331 4857 1010

Medical Jet Services & Partner W DichtlRadetzkystr 19 [email protected] www.medicaljetservice.com1030 Tel: +43 1 713 2799AUSTRIA Fax: +43 1 713 2799-19

Swiss Air Ambulance/REGA Walter Stunzi – PR/Marketing Mgr

PO Box 1414 [email protected] Airport www.rega.chCH-8058 Tel: +41 333 333 333SWITZERLAND Fax: +41 44 654 3590

Tyrol Air Ambulance Jakob Ringler – Managing Director

PO Box 81 [email protected] www.taa.atInnsbruck Airport Tel: +43 512 224 220AUSTRIA Fax: +43 512 288 888

NORTH AMERICA

Aerojet Stuart Hayman – President

4631 NW 31st Ave #220 [email protected] Lauderdale www.aero-jet.comFL 33309 Tel: +1 954 730 9300USA Fax: +1 954 485 6564

Air Ambulance Professionals, Inc. Brian L. Weisz – President

Ft. Lauderdale Executive Airport [email protected] South Perimeter Rd www.airambulanceprof.comHangar 36B Ft. Lauderdale Tel: +1 954 491 0555Florida 33309 Fax: +1 954 491 6114USA

Air Ambulance Specialists, Inc. Donald Jones – President

8001 S.Interport Blvd. [email protected] 250 www.airaasi.comEnglewood Toll Free: +1 800 424 7060CO 80111 Tel: +1 720 875 9182USA Fax: +1 720 875 9183

Air Ambulance Worldwide Inc. Mark Jones – President

35246 US Hwy 19 North [email protected]#210 www.airambulanceworldwide.comPalm Harbor Tel: +1 727 781 1198Florida 34684 Fax: +1 727 786 0897USA

Air Trek Air Ambulance David Bump – Vice President

28000 A-5 Airport Road [email protected] Gorda www.medjets.comFL 33982 Toll free: +1 800 633 5387USA Tel: +1 941 639 7855

Canadian Global Air Ambulance Jeff McIntosh – President

Toronto [email protected] www.canadianglobalair.caVancouver Toll Free: +1 800 563 3822CANADA Tel: +1 204 888 5555

Fax: +1 204 888 9111

Global Air Response Tom Cox – Director of Business

7355 S Peoria Street [email protected]/ Suite 209 www.airresponse.netEnglewood Tel: +1 800 631 6565CO 80112 Fax: +1 888 631 6565USA

JetWest Shawn Crocker16644 Roscoe Blvd [email protected] Nuys www.jetwest.comCalifornia 91406 Tel: +1 818 787 910091406 Fax: +1 818 787 4473USA

AIR AMBULANCE cont.AIR AMBULANCEAFRICA

AMREF Flying Doctor Service Dr Bettina Vadera – Medical Director

Wilson Airport [email protected] www.amref.orgPO Box 18617 Tel: +254 20 600 090Nairobi Fax: +254 20 344 170KENYA

Netcare 911 Aeromedical Shane MaraisNetcare 911 House [email protected] New Road www.netcare911.co.zaHalfway House Tel: +27 11 254 1392Midrand 1685 Fax: +27 11 254 1405SOUTH AFRICA

AUSTRALASIA

CareFlight International Colin Robshaw – Co-ordinator

Westmead Hospital Campus [email protected] Box 159 www.careflight.orgWestmead Tel: +61 2 9891 1644NSW 2145 Fax: +61 2 9891 1284AUSTRALIA

Medical Wings Jarin Kiatfuengfoo – Director

222 Room 3602 [email protected] Int Airport www.medicalwings.comViphavadeo-Rangsit Rd Tel: +662 247 3392Sikan, Donmuang Fax: +662 535 4355Bangkok 10210, THAILAND

Mediflight Debra O’Brien – Operations Manager

Royal Adelaide Hospital [email protected] Terrace www.mediflight.com.auAdelaide Tel: +61 8 8223 6618SA 5000 Fax: +61 8 8223 6340AUSTRALIA

South Pacific Air Ambulance Simon Barton – General Manager Ops

NEW ZEALAND [email protected] Tel: +649 256 9000SINGAPORE Fax: +649 256 9111

EUROPE

Aeromed 365 Ltd Alida Benton – Managing Director

Worth Corner Business Cntr [email protected] Road www.aeromed365.comPound Hill, Crawley Tel: +44 8707 596 999W Sussex RH10 7SL Fax: +44 8707 559 599UK

Ambulanzflugdienst Augsburg Roland Schoberth –Director

Roseggerstr 17 [email protected] www.ambulanzflugdienst.deGersthofen Tel: +49 821 299 1020GERMANY Tel: +49 821 299 2030

DRF German Air Rescue Frank Spirgatis – Director, Fixed Wing

Raiffeisenstr 32 [email protected] Filderstadt www.german-air-rescue.deGERMANY Tel (24hr): +49 711701070

Fax: +49 711701071

Euro-flite Air Ambulance Juani Missonen – Coordinator

Helsinki International Airport [email protected] Box 187 Tel: +358 20510 1900FIN-01531 Fax: +358 20510 1901VantaaFINLAND

FAI – Flight Ambulance International Sven Mueller – Operations Manager

Flughafenstrasse 100 (GAT) [email protected] Nuremberg www.flightambulance.comGERMANY Tel: +49 911 36009 0

Fax: +49 911 36009 59

Global Medical Support Otto Karud – Marketing Director

Ullevaal University Hospital [email protected] Oslo www.globalmedicalsupport.comNORWAY Tel: +47 22 96 50 50

Telfax: +47 22 96 50 51

IFRA Bernhard Fantner – Assistant to Director

Bahnhofplatz 13/5 [email protected] 160 www.ifra.at3500 Krems Tel: +43 2732 825 610AUSTRIA Fax: +43 2732 851 01


SERVICEDIRECTORY 31call +44 (0) 117 925 5151 To make an alteration to a listing email: [email protected]

ASSISTANCE COMPANIES cont.Skyservice Air Ambulance David Ewing – VP Int. Market Development

YUL/Trudeau Int Airport [email protected] Avenue Ryan www.skyservice.comMontreal (Quebec) Tel: +1 514 497 7000H9P 1A2 Fax: +1 514 636 0096CANADA

ASSISTANCE COMPANIES

AFRICA


Wilson Airport [email protected] Road www.amref.orgPO Box 18617 Tel: +254 20 600 090Nairobi Fax: +254 20 344 170KENYA

Connex Assistance Egypt Lara Helmi – Int Network Director

Office II [email protected] Floor www.connexassistance.com6 Sad El Aali Street Tel (24hr): +2 02 336 0005Dokki, Cairo Fax (24hr): +2 02 762 0003EGYPT

AUSTRALASIA

Blue Dot Assistance Dr Faustinus Wirasadi– President Director

Blue Dot Center [email protected] K, L, M www.idn.co.idJl Gelong Baru Utara 5-8 Tel: +62 21 5696 2399Tomang, Jakarta Barat 1440 Fax: +62 21 5696 2499INDONESIA

Customer Care Pty Ltd Janine Benson – Operations Manager

Level 3 [email protected] Miller Street www.customercare.com.auNorth Sydney 2060 Tel: +612 9202 8222NSW Fax: +612 9202 8220AUSTRALIA

First Assistance Mary-Jo McDonald – Sales & Marketing Mgr

PO Box 17-310 [email protected] www.firstassistance.co.nzAuckland Tel: +64 9 356 1650NEW ZEALAND Fax: +64 9 525 1278

Global Assistance & Healthcare Mario Babin – Chief Executive Officer

Jalan Pattimura [email protected] Kebayoran Baru www.global-assistance.netJakaita Tel: +62 21 725 811512110 Fax: +62 21 725 7961INDONESIA


222 Room 3602 [email protected] Int Airport www.medicalwings.comViphavadeo-Rangsit Rd Tel: +662 247 3392Sikan, Donmuang Fax: +662 535 4355Bangkok 10210 THAILAND

South Pacific Air Ambulance Simon Barton – General Manager Ops

NEW ZEALAND [email protected] Tel: +649 256 9000SINGAPORE Fax: +649 256 9111

EUROPE & THE MED

Antalya Assistance Murat Arslanoglu – Network Manager

Muratpasa Mah. [email protected] Menderes Bulvari 19 www.fempatr.comGazihan K:4 D:21 Tel: +90 242 243 6219Antalya Fax: +90 242 248 7724TURKEY

ARC Transistance Hans Biekmann – Network Director

11 Avenue Pleiades [email protected] Brussels www.arctransistance.comBELGIUM Tel: +32 2 776 04 70

Fax: +32 2 776 04 99

Atlantic Assist Adriano Gouveia – Operations Manager

Rua da Alfandega 10-2.D [email protected] Box 750 www.atlanticassist.com9000-056 Funchal Tel: +351 291 214 200Madeira Fax: +351 291 214 202PORTUGAL

Global Voyager Assistance Costas Danilenko – CEO

PO Box II [email protected] www.gvassistance.comMoscow Tel: +7 095 775 0999RUSSIA Fax: +7 095 775 0998

MK International Emergency Services Minas Kaloumenos – General Manager

95, Ioanninon Street [email protected] Athens Tel: +30 210 5154600GREECE Fax: +30 210 5131660

TBS Team 24 d.o.o Edvard Hojnik – General Manager

Ljubljanska Ulica 42 [email protected] Maribor www.tbs-team24.comSLOVENIJA Tel: +386 2618 2301(Croatia, Bosnia, Macedonia, Fax: +386 2618 5800Kosovo, Herzegovina & Serbia)

NORTH & CENTRAL AMERICA

Assured Assistance Inc. Martha Turnbull – Director of Operations

6880 Financial Drive [email protected] Tel: +1 905 816 2495Ontario Fax: +1 905 813 4719L5N 7Y5CANADA

Global Excel Management Brian Allatt – CEO

73 Queen Street [email protected], Quebec www.globalexcel.caJIM IJ3, CANADA Tel: +1 866 566 11304242 Cranmore Court Fax: +1 819 566 8335Belle Isle, Fl 32812, USA

Medex Assistance Corporation Linda McGee – SVP of Sales

8501 LaSalle Road [email protected] 200 www.medexassist.comBaltimore Tel: +1 410 453 6300MD 21286 Fax: +1 410 453 6301USA

TMCA Margaret Whartom – Ops Manager

217 Broadway [email protected] 600 www.tmcatravel.comNYC Tel: +1 212 964 8580NY 10007 Fax: +1 212 406 1520USA

World Travel Protection Canada Inc. Dr Ron Mayer – President & Chf Med Officer

400 University Avenue [email protected] Floor www.wtp.caToronto Tel: +1 416 977 3565Ontario M5G IS7 Fax: +1 416 205 4676CANADA

AIR AMBULANCE INTERIOR

Air Ambulance Technology Egon Kuntner – President

A-5282 [email protected] www.airambulancetechnology.comAUSTRIA Tel: +43 7722 85051

Fax: +43 7722 85051-22

COST CONTAINMENT

EUROPE

ChargeCare International Philip Marshall – Director of Operations

PO Box 18 [email protected] www.chargecare.co.ukEX22 7WB Tel: +44 1409 261 368UK Fax: +44 1409 261 633

M & V Administrators GmbH Jennifer Venables – Corp. Ops Director

Obergütschstrasse 33 [email protected] 7622 www.mv-administrators.comCH-6003 Luzern Tel: +41 41 210 6040SWITZERLAND Fax: +41 41 210 6039

AIR AMBULANCE cont.


SERVICEDIRECTORY 32 To have your company listed in the Service Directory email: [email protected]

NORTH AMERICA


73 Queen Street, Lennoxville [email protected], JIM 1J3, CANADA www.globalexcel.ca4242 Cranmore Court Tel: +1 866 566 1130Belle Isle, FL 32812 Fax: +1 819 566 8335USA

Global Medical Management Raija Itzchaki – Assistant VP Marketing

7901 SW 36th Street [email protected] 100 www.gmmusa.comDavie Tel: +1 954 370 6404FL 33328 Fax: +1 954 370 8613USA

Health Systems International Peggy Novotny – VP / Gen Mng. Int Bus.

5975 Castle Creek Parkway [email protected] 100 www.us-hsi.comIndianapolis Tel: +1 317 806 2000IN 46250 Fax: +1 317 806 2033USA

Health Management Network Rhett Crosby – Nat PPO Network Sales Mgr

Southwest Corporate Center [email protected] W.Broadway Road www.healthmanagementnetwork.comSuite 300, Tempe Tel: +1 480 446 2413AZ 85282 Fax: +1 480 894 313USA

Hygeia Corporation Joe Radigan – Chief Operating Officer

15500 New Barn Road [email protected] 200 www.hygeia.netMiami Lakes Tel: +1 305 594 9291FL 33014 Fax: +1 305 594 9201USA

Medsave USA Donald Moyle – Chief Marketing Officer

1400 Old Country Road [email protected] 109 www.medsaveusa.comWestbury Tel: +1 516 622 1700NY 11590 Fax: +1 516 622 1733USA

OneWorld Assist Calvin Ball – Business Development Manager

10th Floor [email protected] No. 3 Road www.oneworldassist.comRichmond, BC Tel: +1 604 278 4108V6Y 2B2 Fax: +1 604 303 2142CANADA

Star Healthcare Network Inc. Gigi Galen – President

850 Seventh Avenue [email protected] #803 www.starhealthcarenet.comNew York 10019 Tel: +1 212 581 8228USA Fax: +1 212 581 8272

TMCA Margaret Whartom – Ops Manager

217 Broadway [email protected] 600 www.tmcatravel.comNYC Tel: +1 212 964 8580NY 10007 Fax: +1 212 406 1520USA

CLAIMS MANAGEMENT

Global Assistance & Healthcare Nathan Hannah – TPA Mgr Asia/Pac

Jalan Pattimura [email protected] Kebayoran Baru www.global-assistance.netJakaita Tel: +62 21 725 811512110 Fax: +62 21 725 8951INDONESIA


73 Queen Street, Lennoxville [email protected], JIM 1J3, CANADA www.globalexcel.ca4242 Cranmore Court Tel: +1 866 566 1130Belle Isle, FL 32812 Fax: +1 819 566 8335USA

CRITICAL CARE PATIENT TRANSPORT

Lufthansa German Airlines Doris Ehring – Product & Process Management

FRA SQ/B [email protected] Airport Tel: +49 172 367 7929D-60546 Fax: +49 69 690 58147GERMANY

EMERGENCY EVACUATION

Alba Consulting Ltd. Andrew McGill – Managing Director

14 Belvedere Gardens [email protected] www.albaconsulting.orgEast Sussex Tel: +44 1892 610 560TN6 2LR Fax: +44 1892 652 620UK

FUNERAL DIRECTORS

EUROPE

Defin Funeral Services Murat Arslanoglu – Network Manager

Muratpasa Mah. [email protected] Menderes Bulvari 19 www.fempatr.comGazihan K:4 D:21 Tel: +90 242 248 8389Antalya Fax: +90 242 248 7724TURKEY

Funeraria Officia Roberto Zega Cristina Zega – General Manager

Via Clelia 26-28 [email protected] www.zega.itITALY Tel: +39 067 840 300

Fax: +39 067 802 488

Funeralcare International Roger Waddington221 Upper Richmond Road [email protected] Tel: +44 20 8788 5303London SW15 6SQ Fax: +44 20 8788 2525UK

Global Networks Funeral Assistance Cristina Almudi – Managing Director

22 Falcon Crescent [email protected] www.globalnetworksfa.comEN3 4LT Tel: +44 208 350 0645UK Fax: +44 208 482 0742

Kenyon Christopher Henley Christopher Henley – MD

83 Westbourne Grove [email protected] www.kchrepatriation.comLondon W2 4UL Tel: +44 20 7313 6920UK Fax: +44 20 7313 6999

MK Funeral & Transportation Services Minas Kaloumenos – General Manager

95, Ioanninon Street [email protected] Athens Tel: +30 210 5154600GREECE Fax: +30 210 5131660

Rowland Brothers International Melanie Walkling299-305 Whitehorse Road [email protected] Croydon www.rowlandbrothersinternational.co.ukSurrey Tel: +44 20 8684 2324CR0 2HR Fax: +44 20 8684 8000UK

Servilusa Vanda Castro – Manager Int Dept

Agencias Funerarias SA [email protected] Dept. www.servilusa.ptRua do Entreposto Industrial Tel: +35 121 470 63008-2 Esq, 2610-135 Amadora Fax: +35 121 470 6499PORTUGAL

NORTH AMERICA

Bergen Funeral Sevice Scott Nimmo – Funeral Director

129 E 7th St. [email protected] York www.bergenfuneral.comNY 10009 Tel: +1 212 254 2864USA Fax: +1 201 288 5694“Servicing all of the USA, Canada, South & Central America”

COST CONTAINMENT cont.

SERVICEDIRECTORY 33call +44 (0) 117 925 5151 To make an alteration to a listing email: [email protected]

NORTH AMERICA

Air Ambulance Worldwide Inc. Mark Jones – President

35246 US Hwy 19 North [email protected]#210 www.airambulanceworldwide.comPalm Harbor Tel: +1 727 781 1198Florida 34684 Fax: +1 727 786 0897USA

Global Air Response Tom Cox – Director of Business

7355 S Peoria Street [email protected]/ Suite 209 www.airresponse.netEnglewood Tel: +1 800 631 6565CO 80112 Fax: +1 888 631 6565USA

MEDICAL PROVIDERS



Atlantic Assist Adriano Gouveia – Operations Manager

Rua da Alfandega 10-2.D [email protected] Box 750 www.atlanticassist.com9000-056 Funchal Tel: +351 291 214 200Madeira Fax: +351 291 214 202PORTUGAL

MEDICAL SCREENING

Risck Solutions Ltd Ian Findlay – Commercial Director

The Medical Centre [email protected] Broomhill Road www.risck.co.ukBrislington Tel: +44 117 300 7007Bristol BS4 5RG Fax: +44 117 300 7003UK

The Medical Screening Company Glenda Cardenas – Accounts Manager

Monitor House [email protected] Belmont Road www.monitorinternational.comSutton, Surrey Tel: +44 208 770 2778SM2 6DW Fax: +44 208 770 2756UK

Travel & Medical Insurance Services Michael J Turner – MD

1st Flr Suite, West House [email protected] High Street www.travelandmedical.netOrpington, Kent Tel: +44 845 058 8000BR6 0JQ Fax: +44 845 053 3000UK

RE-INSURANCE

Crispin Speers & Partners ltd David Stirling – Marketing Manager

St Clare House [email protected] Minories www.cspinsurance.comLondon EC3N 1PE Tel: +44 20 7977 5700UK Fax: +44 20 7702 9276

TRAVEL AGENTS

Voyageur Aeromedical Travel Marc Lucus – General Manager

Voyageur Buildings [email protected] Colston Street www.voyageur.co.ukBristol BS1 5AX Tel: +44 (0)117 927 3554UK Fax: +44 (0)117 925 5940

HEALTHCARE CLINICSLuzDoc International Medical Serv. Ltd Dr Maria Alice Silva – Medical Director

Medical & Assistance Services [email protected] 25 de Abril, 12 www.luzdoc.comVilla da Luz Tel: +351 282 780 7008600-174, LUZ LGS Fax: +351 282 780 709PORTUGAL

Number One Health Group Dr Charlie Easmon – Director

1 Harley Street [email protected] www.executivescreen.comW1G 9QD Tel: +44 207 307 8756UK Fax: +447092 196 169

HOSPITALS

AmeriMed American Hosp & Med. Cnt. Mark R Engelman – MD

4340 E Indian School Road [email protected] 21, PMB 564, www.amerimed-hospitals.comPhx, Az 85018 Tel: +1 602 952 0405USA Fax: +1 602 952 1668

Bangkok General Hospital Jane Bailey – Int Marketing Executive

International Medical Center [email protected], Soi Soonvijai 7 www.bangkokhospital.comNew Petchburi Road Tel: +66 2310 3460Bangkok 10320 Fax: +66 2310 3367THAILAND

Baptist Health International Center of Miami Yohandra Fuentes – Finance Manager

8940 North Kendall Drive [email protected] 601-E www.baptisthealth.net/internationalMiami, Fl 33176 Tel: +1 786 596 2373USA Fax: +1 786 596 5979

Hospital Clinica Benidorm Ana DaPaz Brown – Medical Director

Avenida Alfonso Purchades 8 [email protected] Benidorm www.clinicabenidorm.comAlicante Tel: +34 96 585 3850SPAIN Fax: +34 96 586 4345

Xanit Hospital de Benalmadena Dr. Juan Bosco Rodriguez Hurtado – Director

Camino de Gilabert s/n [email protected] www.xanit.net29630 Tel: +34 952 44 3119/0032Malaga Fax: +34 952 57 6661SPAIN

MEDICAL ESCORT ON COMMERCIAL AIRLINES

AFRICA



AUSTRALASIA


222 Room 3602 [email protected] Int Airport www.medicalwings.comViphavadeo-Rangsit Rd Tel: +662 247 3392Sikan, Donmuang Fax: +662 535 4355Bangkok 10210 THAILAND

Mediflight Debra O’Brien – Operations Manager

Royal Adelaide Hospital [email protected] Terrace www.mediflight.com.auAdelaide Tel: +61 8 8223 6618SA 5000 Fax: +61 8 8223 6340AUSTRALIA

EUROPE

Medic’Air International Dr Herve Raffin – General Manager

35 Rue Jules Ferry [email protected] Bagnolet www.medic-air.comParis Tel: +33 1 4172 1414FRANCE Fax: +33 1 4857 1010

The 24 Hour Aeromedical Travel Service

Contact: Marc Lucas, Voyageur AeroMedical Travel, VoyageurBuildings, 43 Colston Street, Bristol BS1 5AX

Tel: +44 117 921 0401 Fax:+44 117 925 5940 Email: [email protected]

MEDICAL ESCORT ON COMM. AIRLINES cont.


ONTHEMOVE34

Smile corner

Diary dates

Corporate lesson two:

A priest offered a lift to a Nun. She got inand crossed her legs, forcing her gown toreveal a leg. The priest nearly had anaccident. After controlling the car, hestealthily slid his hand up her leg.The nun said: “Father, rememberPsalm 129?”The priest removed his hand. But,changing gears, he let his hand slideup her leg again.The nun once again said: “Father,

remember Psalm 129?”The priest apologised: “Sorry sister,but the flesh is weak.”Arriving at the convent, the nun wenton her way. On his arrival at thechurch, the priest rushed to look upPsalm 129.It said: “Go forth and seek, further up,you will find glory.”

Moral of the story: If you are notwell informed in your job, you might miss a great opportunity.

2–5 OctoberFERMA risk Management Forum 2005

and 4th IFRIMA ConferenceLisbon Congress Centre, Lisbon

www.ferms-asso.org

5–8 October SRMC Fall Conference

Barbadoswww.srmcsociety.org

6–8 OctoberACE-SCLA Annual Claims Exposition and

ConferenceOrlando, Florida, US

www.ace-scla.com

11 October4th Annual Mergers & Acquisitions

SeminarThe University Club, Chicago, US

www.dykema.com/seminars/

16–18 OctoberNational LTCi Producers Summit

Westin, Kansas City, USwww.ltcsales.com/

18–21 OctoberInternational Association of Insurance

Supervisors (IAIS) ConferenceVienna, Austria

www.iais2005.com/

19 October Society of Insurance Research - Annual

Conference/Workshops and Exhibit FairTradewinds Island Resort, Florida US

www.sirnet.org/

19 October5th Annual Selling to Seniors

ConferenceHyatt Regency, Woodfield Hotel, Illinois, US

www.lifeinsuranceselling.com/

19–21October19th International Reinsurance

CongressFairmont Hamilton Princess Hotel, Bermuda

www.hawksmereltd.co.uk/hawksmere/bermuda/

23–26 OctoberPacifc Insurance Congress.

The Grand Hotel, Taipei, Taiwanwww.pacificinsuranceconference.org/

24–26 OctoberAir Medical Transport Conference

Austin Convention Centre, Austin, Texaswww.austintexas.org/index.php

24–26 October6th Meetings and Incentive Trade

Market (MITM)Guadalajara, Mexicowww.mitmevents.com

7-8 November6th China Rendezvous: Meeting the

Reinsurance Needs of the Dynamic FastGrowing Market

Shanghai International Convention Centre,China

www.asiainsurancereview.com

Willis strengthensglobal claims serviceWillisGroupHoldingshasappointedAndyPearce ashead ofclaimswithinglobaloperationsUK. Pearcewill befocusing onfurtherdevelopingthe delivery of a market-leading claims service, withresponsibility for the end-to-end delivery of a claimsservice across the UK.Previously claims director at Zurich, Pearce wasresponsible for personal claims lines throughout theUK and integrating the operations following Zurich’smerger with Eagle Star. Pearce has extensive claimsexperience and has spent his career serving clientsand managing and transforming large operationaldivisions. Pearce has also worked previously withRSA and AIG.Welcoming Pearce, Phil Dunmore, managingdirector of global operations, said: “I am delightedAndy has joined us. Willis is strongly committed toproviding expert claims service, and Andy bringsimportant leadership qualities that I know will helpraise the bar of customer service to a level that willreveal Willis as the global leader in claims servicedelivery.”

Doran fronts keyNationwide accountMondial hasappointed PaulDoran asoperations accountmanager forNationwide.Nationwide andMondial UK areone year into athree-yearagreement for theprovision of itsbespoke travelinsurance andassistance servicesto customers.As part of his new role, Paul’s responsibilities includeoverseeing the operation of the dedicated policysales call centre, product development and businessobjectives.He will also ensure customer service remains a keyfocus for Mondial’s team of 30, handling theNationwide account. Paul comments: “This is an exciting opportunity andI am keen to work on growing the account, makingit more profitable for both Mondial and Nationwide.My key objective is to improve the sales conversionrate, while maximising the potential of the account.” Steve Hook, director for corporate and travel ofMondial concurs: “Paul has already proven himselfas a very valuable member of our managementteam, and the decision to appoint him to his newrole was an easy one. I am confident that Paul willcontinue to build on the success he has achieved sofar and help develop the long term futurepartnership between Mondial and Nationwide.”

ACE USA appoints RamseyACE USA, the US-basedretail operating division of theACE Group, has appointedPaul Ramsey, executive vicepresident, to lead the ACEUSA claims unit.Based in Philadelphia, MrRamsey will have overallresponsibility for the ACEUSA claims unit, which isstaffed by a team ofexperienced claimsprofessionals dedicated toproviding smart, innovativeclaims management in themost responsive manner. MrRamsey will report to JohnLupica, president and COOof ACE USA.

John Lupica said of theappointment: “Paul’s extensiveleadership and experience inclaims management will enablehim to continue to facilitateACE USA’s delivery of superiorclaims service.” With over 30 years of claimsexperience in the property andcasualty insurance field, MrRamsey joins ACE USA fromSt. Paul Travelers, where hemost recently served as seniorvice president, claim fieldoperations. He has heldnumerous senior leadershippositions in claims operationswith St. Paul, Reliance andTravelers.

ABI aims to regain public confidencecontinued from p.9

company schemes, with the right to opt out. Statingthat advice is essential for consumers if they are tohave any kind of choice, Haddrill points out that theindustry has driven its charges and costs downdramatically.Despite this, with a choice of homes for investors’cash many still question what the life assuranceindustry offers that savers could not find elsewhere.In response to criticism that has been rife, insurersworry that any heavy-handed regulation that may

be brought in stands more risk of stifling choice forconsumers and innovation by companies, ratherthan protecting them. Ultimately insurers need towin back the trust of the public“We want people to trust what they are buying,”continued Haddrill. Subsequent research appears tobe the way they intend to go about this, with theproduction of solid research on what the impactfrom new rules might be going a long way towardshelping their case with regulators.

Terrorism life insurance poolcontinued from p.9

Detecting a gap inthe market, fiveprivate and twogovernment-ownedinsurance companiesin Iraq recentlyunited to offer anexclusive terrorismlife insurance policy.The companies keep10 per cent of themoney they makefrom policies soldand put the

remaining 90 per centinto a shared pool.This pool allows eachfirm to accept risks itwould be unwilling tobear on its own. Although difficult toverify, Dar al SalamInsurance Co.calculates the odds ofbeing killed in aterrorist attack in Iraqat seven times theglobal average.

CONTRIBUTORS

Published on behalf of Voyageur Publishing & Events Ltd,Voyageur Buildings, 43 Colston Street, Bristol BS15AX, UK

The information contained in this publication has been publishedin good faith and every effort has been made to ensure itsaccuracy. Neither the publisher nor Voyageur Ltd can accept anyresponsibility for any error or misinterpretation. All liability forloss, disappointment, negligence or other damage caused byreliance on the information contained in this publication, or in theevent of bankruptcy or liquidation or cessation of the trade of anycompany, individual or firm mentioned, is hereby excluded.

Printed by St. Ives (Roche) Ltd

Copyright © Voyageur Publishing 2004. Materials in this publicationmay not be reproduced in any form without permission.

INTERNATIONAL TRAVEL INSURANCE JOURNAL ISSN 1743-1522

Roger Allnutt is a freelance travel writer based inCanberra, Australia, and has material publishedwidely in magazines and newspapers in Australiaand New Zealand. He travels widely both inAustralia and overseas.

Costas Andrea set up the firm Andrea & Co in May1997, a firm specialising in travel and tourismrelated law. Andrea & Co merged with PenningtonsSolicitors in November 2003 and Costas now headsup the Travel Unit, which currently has ten lawyers,covering all aspects of travel and travel insurancelaw.

Dick Atkins is chief counsel for InternationalRecoveries, Philadelphia, which provides globallegal assistance to the travel insurance industry. Heis in charge of International Recoveries’ legalhotline and has been involved in handlinginternational legal incidents for the past 20 years.He can be reached via email on [email protected]

Miles Clarke is a Sydney-based freelance journalistwith more than two decades’ experience innewspapers, radio and trade press. As a business andtravel writer, his work takes him throughout thePacific, Southeast and East Asia, Australia and NewZealand.

Robin Gauldie is a freelance journalist specialising intravel, aviation and related sectors. A former editor ofthe pan-European travel industry newspaper TTGEuropa, he has also edited Destination ASEAN; ABTAMagazine; and Travel Agent International. Hecontributes to the Times, the Sunday Telegraph, theScotsman, the Sunday Mirror, and to numerousspecalist magazines and is the author of more than 20travel guidebooks.

iJET Travel Intelligence (www.ijet.com), the travel riskmanagement company, provides real-time travelintelligence information through its award-winningWorldcue (copyright) technology platform for trackingand communicating with travellers. iJET services arebacked by regional and category specialists from thefields of intelligence, security, travel, and health whostaff an around-the-clock operations centre in Annapolis,MD.

Milan Korcok is an award-winning freelance healthpolicy and economics writer who covers travelinsurance, public health, and medical educationissues in Canada and the United States. He has beenwriting about health financing and policy issues inthese countries since the 1960s and is a frequentcontributor to leading North American professionaljournals and consumer media. He lives in FortLauderdale, Florida.

Roger St Pierre is one of the UK’s mostexperienced travel, music and motoring writers andhas visited 111 countries on five continents. Hisinsights appear in a wide range of consumer andtrade publications. Roger’s 33 published booksinclude a history of McDonald’s, guides to suchdestinations as Orlando, Moscow, Edinburgh andthe Costa del Sol, biographies of Marilyn Monroe,James Dean, Bob Marley and Jimi Hendrix and arange of cycling books, the latest of which is A BikeIs For Life.

Joan Sullivan Garrett, a critical care registered flightnurse and chief medical officer with more than 15years medical experience, founded MedAire in1985.

Ian Youngman is a specialist freelance insurancewriter and researcher who writes for a wide range ofpublications. As well as researching and publishingspecialist management reports on insurance, he is aghostwriter for various companies andorganisations.He previously had extensive industryexperience with insurers and brokers.

Christopher Wales worked in the ferry industry forover 20 years with such companies as P&O, StenaLine, Eurotunnel and Wightlink. He was Chairman ofthe Institute of Travel & Tourism, a founder boardmember and Chairman of the Coach TourismCouncil and co-founder of the Association of TourOperators to France (ABTOF), for which he wasawarded the Tourism Medal by the Frenchgovernment.


ONTHEMOVE 35

Aviva makes doubleappointmentAviva announces theappointment of CliffordAbrahams, right, asgroup Mergers andAcquisitions (M&A)director with effect from10 October 2005. Theinsurance group has alsoappointed AndreiDoubinine, below, aschief executive officer,Russia, to develop itsentry strategy into theRussian long-term savingsmarket. Clifford joins Aviva from Morgan Stanley, where he iscurrently managing director investment banking,specialising in financial services. He has significant M&Aexperience from eight years with Morgan Stanley’sFinancial Institutions Group and four further years withthe company in broader M&A roles. Prior to joiningMorgan Stanley, Clifford was a strategy consultant withLEK Consulting.Clifford replaces Mark Dearsley, who took up the roleof finance director, Aviva Life International earlier thisyear. Clifford will report to Andrew Moss, Aviva’sgroup finance director, leading a team of three M&A

professionals.Andrew Moss said: “Weare delighted that Clifford isto join the Aviva team. Hehas a first-class track recordin M&A activity in thefinancial services sector. Wewill continue our strategy ofaugmenting organic growthplans by developing newdistribution opportunitiesand acquisitions where theywill deliver value to ourshareholders.”Meanwhile, Andrei

Doubinine, 42, joins Aviva from Ingosstrakh, one ofthe leading Russian insurers, where he was vice-president for the group’s life and pensions business.He spent seven years with Ingosstrakh, in a variety ofroles, and successfully launched the group’s life andpensions business in 2004.Prior to this, Andrei was the Russian diplomaticrepresentative for the World Trade Organisationbased in Geneva. Aviva has recently opened a representative office inMoscow, as part of its exploration of the potential ofthe Russian market, including distribution options andproduct design.Philip Scott, executive director, Aviva Life International,commented: “Although in its infancy the Russian long-term savings market is developing following recentregulatory reform. Andrei will develop our entrystrategy into this new market.”Aviva has roots in Russia going back to 1856 whenthe Northern Assurance Company, later part ofCommercial Union, appointed Miller & Co. agents forlife and general insurance in St Petersburg.

Muir headsoperation CegaMedical assistance andtravel claims company,Cega Group, hasannounced theappointment of MuirRobertson as operationsdirector. Muir, who joinedCega in 1999 from ZurichInsurance, has beenresponsible for establishingthe non-emergency claimsteam since joining thecompany and has focused on combining the skills ofboth the medical emergency and claims divisions.

Selective announcesnew executivesSelectiveInsuranceGroup, Inc.,headquartered inBranchville, NewJersey, US, aholding companyfor property andcasualtyinsurancecompanies, hasrecentlyannounced theexecutive appointments of John Marchioni, to seniorvice president of personal lines underwriting ofSelective Insurance Company of America and VicePresident of Selective Insurance Group, Inc., andKathy Muedder to senior vice president, casualtyline of business manager of Selective InsuranceCompany of America.In John Marchioni’s new role, he has oversight forimplementing the company’s personal lines strategy

and managingoperations of thepersonal linesstrategic businessunit. MrMarchionipreviously servedas vice presidentof Selective’scommercialmercantile/servicestrategic businessunit. He joinedSelective in 1998as a governmentaffairs specialistand was

promoted to department director in 2000. Prior tojoining Selective, he was vice president, governmentaffairs with the Commerce and Industry Associationof New Jersey. Ms Muedder will be in charge of overseeing thecommercial casualty underwriting, loss control andpremium audit functions at Selective. She joinedSelective in May 2005 with extensive casualtyunderwriting and government affairs experience.Most recently, she served as senior vice president ofemerging issues for ACE USA. She is currently onthe board of the Workers Compensation ResearchInstitute (WCRI) and has served on the board ofdirectors of the National Council on CompensationInsurance (NCCI).

Snyder and Spiller join Guy CarpenterGuy Carpenter & Company, Inc., the global risk andreinsurance specialist and a part of the Marsh &McLennan Companies, has said that Jack Snyder,pictured, is to join the companyas a managing director andmanager of businessdevelopment for the Americas,reporting to executive vicepresident Michael Schnur, wholeads the unit. The company hasalso elected a new president inDavid Spiller, effective 1 January2006.Mr Schnur said: “Jack’sknowledge of the insurancemarket, coupled with his ratingagency and Wall Streetbackground, will be of great valueas we work to provide clientswith superior risk managementsolutions in an increasinglycomplex environment.Mr Snyder, 45, was chief marketing officer forAmerican Re where he was responsible for a widerange of marketing activities. Previously, Mr Snyder

was chief ratings officer for the A.M. Best Company.Earlier in his career, Mr Snyder was a securitiesanalyst following the insurance industry for Smith

Barney and also was anunderwriter for GeneralReinsurance Corporation. David Spiller, who will join thecompany as president in theNew Year, was CEO of BenfieldLtd, London, chief executive ofits International Division and amember of its executivecommittee. He was elected tothe Lloyd’s Insurance Broker’sCommittee in 1996 and chairedthe Broker’s ReinsuranceCommittee from 1997 to1999. In addition, he haschaired the London MarketBrokers’ Committee since2003. In his new role, Spiller will be

based in New York and will report directly to SalZaffino, and be responsible for developing strategicplans for the company’s global enterprise.

Swiss Re appointsAigrain chiefSwiss Re’sBoard ofDirectors hasappointedJacques Aigrain,chief executiveofficer, effective1 January 2006.Jacques Aigrain,currentlydeputy CEO ofSwiss Re,succeeds JohnCoomber, whowill retire as of31 December2005. SwissRe’s Board ofDirectors willpropose JohnCoomber for election to the Board at the annualshareholders’ meeting in April 2006. “Under John Coomber’s leadership, Swiss Restrongly improved its results, strengthened itsbalance sheet and reset its strategic focus,” sayschairman of the board of directors PeterForstmoser. “As we change over to our neworganisational structure, our long term managementplan now allows a smooth transition at the helm ofthe organisation to Jacques Aigrain.” CEO John Coomber added: “Having set up thenew organisation, I can as planned, and with pridein our accomplishments, hand over to JacquesAigrain.” Jacques Aigrain, 51, brings broad operational andmanagement expertise to the position of CEO. In1981 Aigrain began his career in the corporatefinance team of investment bank JP Morgan in Paris,London and New York. Between 1986 and 1992he helped JP Morgan New York to build up amergers and acquisitions (M&A) department, beforefinally becoming Co-Head of Corporate Finance atthe firm. In 2001 Jacques Aigrain was appointed to theExecutive Board Committee of Swiss Re and put incharge of the newly created financial servicesbusiness group. After having successfully turnedaround and expanded Financial Services, JacquesAigrain was appointed deputy CEO in 2004.With Jacques Aigrain becoming CEO of Swiss Re,Michel Liès becomes head client Markets andmember of the executive board committee. MartinAlbers will succeed Michel Liès as head clientmarkets Europe.

itij - s3-eu-west-1.amazonaws.comissue 57 • october 2005 itij the economic losses from hurricane...

Documents