FBI risk management accused of discrimination
A report in the New York Times over the weekend has sparked a debate about when risk management becomes oppressive. The Federal Bureau of Investigation introduced its program Post-Adjudication Risk Management, known as PARM, following the 9/11 attacks in 2001. The FBI carries out rigorous background checks on all employees and contractors but those placed in the PARM program face tougher scrutiny. The newspaper report claims that those with foreign language skills and family aboard have in some cases have been forced to cut ties with family overseas. The FBI says that its program protects national security and does not discriminate.
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Tough times for reinsurers in 2015 renewal season
Tough market conditions are putting pressure on reinsurers, especially the smaller ones, according to the latest report from Willis Re. The firm’s
1st View renewals report says that a reshaping of the global reinsurance industry is now underway with lower rates being demanded by buyers, low returns on investments, new capital sources and a year of large losses all adding to the tougher conditions. Willis says that increased M&A activity in the sector is now a reality. Chairman Peter Hearn said: “In the current environment, many reinsurers recognise they can no longer hope for salvation through major market losses or increasing interest rates. Their only sustainable course of action is to change their business models, portfolio mixes and to strive for scale.” On a positive note, some reinsurers are maintaining key client relationships on higher rates and a predicted flood of hedge fund-backed reinsurers appears to have abated.
Australian bushfires declared “catastrophe” by insurance council
Insurers in Australia will intensify their response to bushfires in regions near Adelaide after the Insurance Council of Australia declared it a “catastrophe”. Officials say that the fires are the worst since 1983 and the weather is set to get hotter over the coming days along with stronger winds increasing the risk to homes and business. Around 500 fire-fighters are currently tackling the blaze which has burnt 12,500 hectares of land since Friday. Rob Whelan, CEO of the Insurance Council, says: “At this stage the ICA is relying on information from the CFS and does not have firm damage estimates. Insurers will continue to monitor the situation, and I expect the ICA will have a firmer grasp of the extent of the damage in the next few days as owners return to their properties, assess the damage and contact their insurer or insurance broker."
