All Posts in "Day: December 23, 2020"

European Commission (EC) has launched a 5months Phase II competition investigation before it will approve or reject the proposed $30bn Aon acquisition of Willis Towers Watson (WTW),

The broker said it expected a full competition review of the deal, and believes its current completion schedule for the first half of 2021 will be met. The EC has until 10 May to deliver its verdict.

Opening the in-depth probe, EC competition commissioner Margrethe Vestager said the investigation will “assess carefully whether the transaction could lead to negative effects for competition, less choice and higher prices for European customers in the commercial risk brokerage market”.

The EC’s initial review raised several concerns and the EC said it could not approve the merger without further investigation.

The EC said it is concerned that bringing the two brokers together “could significantly reduce competition” in commercial broking, reinsurance broking and retirement services for commercial clients.

In an initial market probe, the EC identified a number of concerns, particularly when it comes to the supply of commercial broking services to large multinational clients that depend on high-level expertise.

It said multinational broking services for P&C, financial and professional services, credit and political, cyber and marine risks would be most affected by combining Aon and WTW.

It added that the broking services to commercial clients of all sizes for aerospace manufacturing risks could also be negatively impacted.

“Aon and Willis Towers Watson are two of the very few brokers that are able to provide these services on a multinational scale,” the EC said. It noted that Aon and WTW did not submit commitments during the initial investigation, which closed yesterday, to address the EC’s preliminary concerns.

Aon said: “The Phase II review is a common next step in the review process for a transaction of this size and complexity under the EU Merger Regulation, and the firm remains on track to close the combination in the first half of 2021.”

But it is confident about a positive outcome from the review and will work with the EC during the process.

The Aon/WTW deal was announced in March this year and was approved by shareholders of both firms in August.

Patoma Admin by — December 23, 2020 in Insurance 0
Continental Re boss tasks SMEs on “Must have insurance policies”

By Favour Nnabugwu

Operators in the Small and Medium Enterprises (SMEs) sector in Nigeria have been urged to take up insurance policies that can help them to continue operating in an uncertain and extreme times.

Dr. Femi Oyetunji, the Group Managing Director of Continental Reinsurance Plc, made the call during Access Bank Plc and Coronation Insurance Plc’s webinar themed ‘ Managing Business Risks at a Time of Uncertainty ‘

He identified the following top SMEs business risks are :
* Keyman
* Currency
* Regulatory
* Property damage
* Reputational risks,
* Business interruption
* Supply chain , including
*Cyber risks
* Fraud”

He emphasizes on the need for Keyman policy, saying ” for most SMEs, everything revolves around a person, not necessarily the business owner. It could be the master baker in a bread industry.

The keyman knows everything about the company in his head, and tomorrow he may decide to leave, and what would you do if he suddenly left?

“So, be sure that if anything happen either the keyman suddenly walked away or the death of the owner, you still want to be able to generate income. So, be sure to take up keyman insurance,” he said.

Further, he urged the business owners, to consider” diversify your products and your locations, and instead of importing the raw materials for your product, consider local content that you can use for substitute, because you don’t want to be exposed to a particular source, and in terms of the transfer of money and to be sure you can deliver your product to customers. ”

On Currency Risk, he noted : ” You can’t transfer this risk . It is best to have zero tolerance for the regulator,and be a good business person .

” Property Damage: Don’t cut costs at the point you need it most. The best thing is for you to locate your business where it can be protected, such as in a class – A rated office facility with fire extinguishers. Although, it may be more expensive, yey it is beneficial.

” Cyber Risk: With technology comes cyber risks . Nevertheless, you can invest in modern technology for production , packaging and delivery of your product, such as bread.”

He urged insurance practitioners, not to just sell their products to SMEs, rather, our number one objective is risk management ; we want to sell our products after we have work with you to reduce your exposure to risks as much as possible.

“So, insurers should look at the risks, and what the other options are to transfer the risk to another entity. The entity can come in various forms- reinsurance companies, derivatives, and linked securities,” he said.

Patoma Admin by — December 23, 2020 in Insurance 0