Generali Bolting From Germany

Generali SpA (G.MI) doesn't rule out the sale of a 40 billion euro ($47.1 billion) life insurance portfolio of Generali Leben as part of the reorganization of its German operations, the Italian insurer said Thursday. 

The company, based in the city of Trieste, said it would put its Generali Leben business into runoff --namely, it would honor its obligations on existing policies but not add new ones-- in the first quarter of 2018, paving the way for potential disposal. The move will improve the group's economic solvency, it said. UBS analysts estimate a sale of Generali Leben could generate between EUR700 million and EUR900 million in proceeds. In addition, in 2018, Generali's EVG network of 2,800 agents in Germany will be folded into an existing joint venture the company has with insurance agent network DVAG, in which it also has a stake.

"The runoff of Generali Leben will free up resources that will allow us to capture new growth opportunities in the German market," Chief Executive Officer Philippe Donnet said.

With gross written premiums of more than EUR16 billion, Germany is the second-biggest market for Generali after Italy. The move is part of the wider reorganization of Generali Deutschland, the second-largest primary insurer in Germany. The plan, aimed at strengthening operating performance, includes rationalizing the company's German portfolio, streamlining the operations and investing to develop its direct insurer CosmosDirekt.

Last year Generali outlined a plan to rejig its geographical presence by leaving less profitable markets to focus on core ones. As part of the plan, Generali agreed to sell its Dutch business Generali Nederland NV earlier this month. Generali expects the plan to generate at least EUR1 billion of cash by 2018.

DBS & Chubb Partnership

DBS Group Holdings - has entered into a 15-year distribution partnership agreement with New York-listed insurance company Chubb for its markets in Singapore, Hong Kong, Taiwan, Indonesia and China.

The Singapore bank said on Thursday that it will distribute Chubb's coverage for home, contents and selected personal-accident and supplemental health-insurance products, as well as general insurance products for small and medium enterprises. The agreement will take effect in early 2018, and insurance products will be rolled out by DBS progressively through the year.

By leveraging on DBS' network in Asia, the partnership will expand Chubb's market reach in the region. Out of $35.9 billion of gross premiums written by Chubb in 2016, $4.6 billion were in Asia. DBS' large customer base "broadens and deepens" Chubb's presence in the region, Evan G. Greenberg, Chubb's chairman and chief executive, said in a statement.

"At DBS, we were looking for a general insurance partner with a strong, long-standing presence in Asia, a broad product portfolio, extensive digital capabilities, and a proven track record of bancassurance sales," Piyush Gupta, chief executive of DBS, said in the same statement. "Chubb fit our criteria in every respect."

Bancassurance products are sold through a bank instead of insurance agents. DBS has been forging such partnerships with a number of international players in recent years. Last year, Canadian insurance company Manulife Financial struck a $1.2 billion deal with DBS for a 15-year bancassurance partnership to distribute its products across Singapore, Hong Kong, China and Indonesia, with additional payments based on the success of the partnership.

Chubb is the world's largest publicly traded property and casualty insurance company and among the largest global players in general insurance and reinsurance. It serves clients in more than 190 markets. 

Allianz Indonesia Deny Cheating Customer

Insurance company Asuransi Allianz Life Indonesia has denied claims that the company had hampered the insurance claiming process for one of its customers, Ifranius Algadri.

"With regard to the objection case for the current claim status, Allianz has requested supporting documents as part of the usual process to ensure that the claim is valid," said Adrian DW, Head of Corporate Communication of Allianz Indonesia in Jakarta, on Thursday (9/28/2017 ).

The company’s denial is related to a criminal case which that ensnared two former Allianz high-ranking officials, namely President Director of Asuransi Allianz Life Indonesia Joachim Wessling, and Claim Manager of Asuransi Allianz Life Indonesia Yuliana Firmansyah.

The two former high officials have been named as suspects by the Jakarta Metro Police for allegedly violating Article 8 paragraph 1 letter (F), Article 10 letter (C), and Article 18 juncto Article 62 paragraph 1 juncto Article 63 letter (F) Law RI Number 8 years 1999 on Consumer Protection.

The case stemmed from the report of two Allianz insurance customers, Ifranius Algadri and Indah Goena Nanda. They reported fraudulent allegations related to the denial of hospital's claims of fees by Allianz to Jakarta Metro Police on March and April, 2017.

Both of them reported that Allianz denied their claim statuses, even though the customers considered to have fulfilled the requirements in accordance with the policy book.

According to Irfan's attorney, Alvin Lim, Allianz refused to pay claims by giving a letter of clarification that customers need to provide complete medical records from the hospital. In fact, the medical records are a property of the hospital and can not be given immediately even to patients. This is in accordance with the Minister of Health Regulation No. 269/MENKES/PER/III/2008 on Medical Record. The patients only got a resume or medical summary.

The customers ended up processing the medical record to the hospital where the customers were undergoing treatment. However, the hospital still refused to provide their medical records. The company did not provide and specific details on the medical record request.

Another Muslim Only Launderette

Another launderette serving only Muslims has been found to be operating in Perlis – just as the Sultan of Johor and the Government have sent out a message that such segregation must not happen in Malaysia. 

The self-service outlet in Jalan Kampung Bakau here has a sign that says: “This laundry is dedicated for Muslim use only”.

The main signboard stated the shop practises “Islamic laundry concept.”

A call made to the handphone number listed at the shop was answered by a man claiming to be the owner. He said he opened the laundry to serve only Muslims.

Asked why, the man said it was done for the “comfort” of the Muslim customers. He urged non-Muslims to use other launderettes and stressed the matter should not be turned into a controversy.

Perlis Mufti Datuk Dr Mohd Asri Zainal Abidin, one of the vocal critics against the “Muslim-only” launderette in Muar, was not having any of that. He came down hard on the shop, making it clear that the state would not agree to any approach which segregated the people.

“I have received an instruction from Tuanku (the Raja Muda of Perlis) to investigate the matter and we will do it right away.

Police Charged Former CEO Allianz Indonesia

The Jakarta Police have charged two former executives of Asuransi Allianz Life Indonesia, a local unit of Allianz, the Munich-based insurance giant, with allegedly breaking the country's consumer protection law.

This is a rare case in consumer protection disputes in Indonesia, which are usually settled through the civil court.

The police charged Joachim Wessling, a former president director of Allianz Indonesia, and Yuliana Firmansyah, a former claim manager at the company, with allegedly preventing clients from claiming their health insurance money, Jakarta Police investigation director Adi Deriyan said on Tuesday (26/09).

According to Alvin Lim, a lawyer for two Allianz Indonesia customers, Ifranius Algadri and Indah Goena Nanda, the insurance company had asked his clients to provide complete medical records when making their claims, an additional requirement that is not stated in their insurance policies.

The insurance company allowed only two weeks for the clients to meet the requirement, but only informed them of the extra requirement four days before the deadline.
Allianz Indonesia then refused the clients' request to extend the deadline.

Under Indonesian Health Ministry regulation, hospitals are only obliged to provide summaries of patients' medical records, which meant the clients were unable to fulfill Allianz Indonesia's request, Alvin said.

The lawyer stressed that it is the insurer's duty to obtain his clients' complete medical records from the hospitals as part of a normal claim investigation process.

"What we are disputing here is not whether the claim is paid or not, but how [the suspects] processed the claim. There was an element of deceit," Alvin said.

The two suspects are now facing a possible five-year prison sentence if they are found guilty of deceiving the clients.

Infranius, whose Rp 16 million ($1200) claim to Allianz Indonesia from being hospitalized last year remains unpaid, said he is "very disappointed" with how the company handled his case.

"They said their claim process was simple, only needs 14 days. I fell ill last year with typhoid, but to this day my insurance claim still has not been paid," he said.
Indah Goena, who was hospitalized for food poisoning this year, said her decision to bring the case to the criminal court was never about the money.

"I was disappointed with their claim process. How come to get the money we have to breach the Health Ministry's regulation first?" she said.

Alvin said his clients are adamant that they bring their case before the criminal court to serve as a warning for other insurers. "It is their hope that other people will not have to go through what they went through," he said.

Allianz Indonesia said the company is aware of the case but is unable to comment since the legal process is still ongoing.

"We always act in accordance with the provisions in the policy and in accordance with applicable laws and regulations. All requests and objections from customers are also treated accordingly," Adrian D.W., the head of corporate communications at Allianz Indonesia, said in a statement.

Asuransi Allianz Life Indonesia Scams Customers

Investigators of the Special Criminal Investigation Directorate of Jakarta Metro Police established Joachim Wessling the President Director of Asuransi Allianz Life Indonesia and Claim Manager Yuliana Firmansyah as suspects on the alleged criminal case of consumer protection.

Director of Special Criminal Investigation of Jakarta Metro Police, Great Commissioner Adi Deriyan stated that he would conduct further investigation on the case. "Yes, I will see how the investigation plan is," said Adi when confirmed by reporters, Tuesday (9/26/2017).

Meanwhile, Alvin Lim, the attorney for the plaintiff as well as the victim said that his client Ifranius Algadri has sued Joachim Wessling and Yuliana Firmansyah, because the company obstructed the process of him claiming his hospital care costs.

Lim explained that Allianz always requested for the hospital's complete medical records as a requirement to disburse claims of hospital fees. However, according to Lim, hospitals are never allowed to provide complete medical records of patients because it violates Minister of Health Decree No. 269/Menkes/PER/III/2008 on medical records.s

Lim added that the hospitals are only allowed by law to provide medical resume, but not a complete medical record.

"Usually the rejection of claim is a civil case, but this is a criminal case because what we are questioning is not the non-payment of a claim, but how does he (Allianz insurance-red) processes the claim, because there is an element of fraud," said Lim at Jakarta Metro Police.

It is alleged that Allianz uses a deceptive mode to refuse clients’ claims in a subtle but unlawful manner. Within two weeks without a complete medical record, Allianz would reject the claim.

Lim said there are 13 other people who have come forward admitting to be victims of Asuransi Allianz Life Indonesia’s alleged fraud.

Criminal investigation on Joachim Wessling and Yuliana Firmansyah is listed in Police Report No. LP/1645/IV/2017/Dit Reskrimsus dated April 3, 2017 on alleged criminal offenses in the field of consumer protection and Police Report No. LP/1932/IV/2017/PMJ/Dit . Reskrimsus dated April 18, 2017.

MII Wants Tax Relief Medical Insurance

The Malaysian Insurance Institute (MII) wants additional tax relief in Budget 2018 to encourage more consumers to subscribe to medical insurance.  

Its Chief Executive Officer, Datuk Syed Moheeb Syed Kamarulzaman, said the move would help ease the public healthcare system which has been under strain as more patients started to move to public hospitals from private hospitals. 

"Although the public healthcare caters to categories like the ageing population and the financially-challenged, patients shifting to public healthcare from the private system are beginning to put a strain on it," he told reporters on the sidelines of Medical and Health Insurance Seminar 2017 here today. 

The one-day seminar attracted over 100 professionals and key players discussing topical issues of the day and new developments in the medical and health insurance industry. 

On another note, Syed Moheeb said, although there had been an increasing trend of premium contributions and higher subscription rate in the market, insurance claims were also on the rise.

"The industry is concerned with the increasing number of claims which is currently at 71.6 per cent, which means that three quarter of premiums collected goes to claims.

"There are also other expenses, including handling costs and expertise, thus it is probably either a break-even or a loss situation for the medical and health insurance providers," he added.  

On a recent news report which claimed that the implementation of Goods and Services Tax had led to a high number of policies being surrendered in the last four years, Syed Moheeb said, the tax was not a contributing factor to the high lapsation rate.

The report had quoted National Association of Malaysian Life Insurance and Family Takaful Advisors President, James Bong.

"In my view, the consumers would have been subscribing or paying for life insurance policies for a long time and they wouldn't want to let the small increase affect what they have saved over the years.

“I do not think it is in our nature to actually let the previous savings go to waste," he said.

Syarikat Takaful Malaysia Soars

Syarikat Takaful Malaysia Bhd gets an “outperform” rating and RM4.27 target price from Kenanga Investment Bank Bhd as the latter initiated coverage on the stock.

Kenanga IB said growing demand for takaful products, low penetration rates as well as government initiatives augur well for Syarikat Takaful’s earnings prospect.

Syarikat Takaful’s total fund assets size have grown with a higher quantum of five-year compound annual growth rate (CAGR) of 10 per cent to RM26.8 billion in 2016 compared to the conventional insurance’s total fund assets growth of seven per cent.

Its net contribution income has also grown faster at five-year CAGR of nine per cent vis-a-vis conventional five-year CAGR of six per cent.

“Coupled with low penetration rate of 54 per cent as well as growing consumer awareness amid rising medical costs and living expenses, we still see tremendous potential in the takaful business which will continue to support Syarikat Takaful earnings,” Kenanga IB said.

The firm said Syarikat Takaful is also well poised to benefit from government’s initiatives under the Economic Transformation Programme (ETP).

The government has initiated a few important initiatives such as Life Insurance and Family Takaful Framework as well as phased liberalisation of general insurance to improve intake of insurance and takaful products and services with the aim to achieve 75 per cent penetration rate by 2020 under ETP.

“Given the group’s biggest market share in industry’s group Family Takaful business (at 25 per cent as of financial year 2016), and having the fourth biggest market share in the combined Life insurance and Family Takaful business, we believe the group is well poised to benefit from such initiatives,” it said.

It said this support its estimated two-year GEP CAGR of 14 per cent.

Syarikat Takaful’s unique proposition with 15 per cent no-claim rebate will continue to attract the right customers with good claim experience as well as a stabiliser in driving low claims experience – which have seen its net earned premium growing at a five-year CAGR of nine per cent.

“In terms of claims experience, the group’s ratio is well maintained at 53 per cent to 58 per cent from financial year 2011 to 2016, vis-à-vis other conventional insurers which are hovering at 40 per cent to 63 per cent, thanks to its unique proposition as well as well-balanced classes of business,” it said.