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Contact CATEX
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Dear Colleague,
Our newsletter editor, Frank Fortunato, just returned from a trip to England including a period in our London office. London, in addition to being the world's global reinsurance center, is hosting the XXXth Olympiad this summer. Since it is after all summer we thought that you might be interested with some of his observations about London and the UK on the eve of the Olympics.
He has interspersed some insurance and reinsurance news in his report but hopefully you will be able to relax a bit and gain a sense of what's going on in the British capital as it prepares to welcome over a million visitors for the Games.
Please contact me if you would like additional information about our data reporting system or CATEX Insurance & Reinsurance Systems for brokers, MGA's and risk bearers.
Thank you very much and have a pleasant and safe summer.
Stephanie A. Fucetola
Vice President/CATEX |
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Olympic Rings on Tower Bridge
If you've been to London this summer you know that the city is gripped by a frenzy of activity pertaining to the 2012 summer Olympic Games. It is impossible to travel anywhere on the roads or in the tubes without seeing constant reminders of the expected arrival of millions of visitors expected.
Special lanes have been set up in the streets to speed Olympic athletes back and forth from their lodgings to their events. Over 18,000 British troops have been activated and are in London --twice as many troops as the UK currently has in Afghanistan. There is an aircraft carrier moored in the Thames and the five Olympic rings are hanging from the Tower Bridge.
And did we mention that several apartment buildings in East London, the main site of the Games, have surface-to-air missile sites installed on their roofs? The British seem to have considered everything and if the Games are less than a 100% success it will not be due to anything that could have been overlooked.
The Games are heavily insured. Reports indicate that if the Olympics were fatally disrupted by an act of terror, earthquake or flooding about $4.8 billion dollars would be lost. There is coverage in place for such a catastrophe. Let us hope that all goes well and that the XXXth Olympiad will be a huge event for London and the United Kingdom.
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Aerial view of Hyde Park
Near miss for a claim
Hyde Park in London is a very big park. Hyde Park connects to Green Park and St. James Park allowing one to essentially be able to walk through the heart of London in a verdant, quiet atmosphere.
If you're afraid of dogs though it's not the place for you. The British attitude towards our four legged friends is much more indulgent than what you may encounter in an American park where dogs are bound by leash requirements. It's not unusual to be jogging in the park and realize that you've picked up a few playmates who are running along with you waiting for you to pay attention to them.
Because Hyde Park is so big it's one of the few places in London suitable for mass outdoor events like concerts. One big news item last week concerned Bruce Springsteen. 80,000 people were attending a concert given by Springsteen and his E Street Band --which comes complete with the loudest and most advanced amplification equipment money can buy. It is likely that, if she was interested, the Queen herself less than 2 miles away in Buckingham Palace could have listened to the music.
The problem is that many other people, those with the means to live in the high-priced area near the park, are even closer to the music and a 10:30 pm curfew is enforced. How strict that curfew is can now be revealed.
By the time Springsteen concluded his 3.5 hour concert he had already exceeded the curfew limit. Then Sir Paul McCartney appeared on stage and played three duets with Springsteen. Unfortunately the 80,000 attendees only heard the first two songs. The concert organizers pulled the plug on the sound before the third one.
Remember how many US towns and cities have cancelled July 4th fireworks displays because of costly insurance premiums? Think of 80,000 angry people who had had the plug pulled on the ex-Beatle and Springsteen and you have an underwriter's nightmare. A review of the insurance coverage for the event probably would have focused closely on whether the client (in this case the organizers) had adhered to all local ordinances. No doubt the plug-pullers were weighing the risks of imperiling future Hyde Park concerts by having breached the curfew against the hope of controlling of 80,000 disappointed fans.
They chose correctly it seems. Everyone dispersed without incident and 48 hours later Paul Simon, with a full African Orchestra supporting him, played to 20,000 people in the same venue. He came in under the curfew time. |
A Big Risk?
This is the Cunard ship Queen Mary 2. It's a big one, weighing about 148,000 tons. There are cruise ships now that are larger but as far as a bona fide ocean liner is concerned this is the biggest one built to navigate the stormy seas of the North Atlantic. Having been designed as an ocean liner, she required 40% more steel than a standard cruise ship
It cost about $900 million to build back in 2003. Insurance placed on the QM2 is spread around the world and finds coverage participants in Lloyd's, the US, Germany and anywhere there is capacity that specializes in marine cover.
From the public viewing area behind the bridge it's possible to see who is actually driving this billion dollar piece of equipment. Any notions of actually seeing a a whiskered captain grasping a large, wooden steering wheel are replaced by the reality of three younger fellows intently monitoring data on computer screens.
The ship's captain, Christopher Wells, indicated that the bridge of the QM2 is as automated as the cockpit of a modern 747.
On July 13, as the QM2 neared Southampton, England, Captain Wells announced that for the first time since the Queen's Jubilee all three Cunard Queens were coming into a port together for the first time. This meant that in addition to the QM2, the Queen Victoria and Queen Elizabeth were steaming into port separated by 16 minute intervals.
Talk about really big risks! Estimates from the capsizing of the Costa Concordia earlier this year off Rome are that insurers could bear over $1 billion in losses. The PML represented by the presence of the Queen Mary 2, Queen Elizabeth and Queen Victoria, all in one port at the same time, would be much higher.
Everyone on board was out on deck at 4:30 am to watch the convoy of the three Cunard Queens sail into Southampton harbor. It was quite a sight and reminded me of the importance of insurance. One of the reasons Iran can't ship any of its oil is because sanctions have prohibited EU, London and US insurers from providing those oil tankers with coverage. No coverage means no voyage means no oil shipments. |
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Quick "Bytes"
Some 16 inches of rain fell in Beijing on July 23 causing the deaths of 37 people and damage of over $1.5 billion. Oddly, modern drainage systems seem not to have worked while a drainage system in the Circular City in Behai Park, built in the 1400s, worked just fine. The next day there were no fewer than 9 million posts on a Beijing blog site complaining....A lignite fired electrical power plant responsible for producing 7% of Poland's power suffered severe damage on July 25 in a fire. The PGE Turow plant was modernized in 2005....Lord Levene, formerly Lloyd's chairman is now Vice-Chair at CV Starr. His successor at Lloyd's, John Nelson, has been traveling globally discussing the new Lloyd's Vision 2025 plan of action for the corporation |
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There will be no newsletter in August. Enjoy the summer. |
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