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Willis Re: Capital Influx Could Displace up to $40 Billion of Traditional Equity Reinsurance Capital

The influx of third-party capital into the reinsurance market may displace up to $40 billion of traditional equity capital, which could either be returned to shareholders or redeployed elsewhere in the re/insurance market, according to Willis Re, the reinsurance arm of Willis Group Holdings plc, the global risk advisor, insurance and reinsurance broker (NYSE:WSH).

The current trajectory of growth in third party capital suggests it could account for up to 30 percent of the global property catastrophe reinsurance market within a few years, representing approximately $100 billion of capacity, according to panellists at the Willis Re Monte Carlo Rendezvous Press Conference.

John Cavanagh, CEO of Willis Re, commented: "Discussions so far have centred on the effect third party capital is having on rates and the competition it is producing in the property catastrophe reinsurance market. A future influx of $100 billion would, however, have a number of profound consequences. As third party capital enters the property cat reinsurance market, it is going to crowd out conventional equity capital. That equity capital has to go somewhere."

Cavanagh added that if $100 billion of third party capital enters the reinsurance market, then even allowing for significant returns of capital to shareholders, there could be as much as $20 billion excess equity capital to be deployed.

He continued: "You could think of this as being the equivalent of 10 well capitalised start-up companies, and the effect on the market place would be profound. If capital is redeployed, much of it could go into direct insurance businesses. Many of the hybrid specialty reinsurers are already implicitly going down this path."

The influx of third party capital, coupled with changes to reinsurance buying patterns and regulatory complexity is leading to growing complexity in the reinsurance market. Cavanagh said: "Solid analytical advice and market knowledge through intermediation is needed now more than ever."

Also speaking at the event, Tony Ursano, CEO of Willis Capital Markets & Advisory, said that he expects a very active capital markets and mergers and acquisitions (M&A) environment for the remainder of 2013 and going into 2014. Ursano said: "On the capital markets side, we expect a very active cat bond calendar, including new and renewal sidecar financings, additional activity around new insurance-linked securities fund formations and strategic partnerships, as well as more new hedge fund sponsored reinsurers. "We expect activity in the insurance M&A arena to be robust, driven by a number of factors. These include increased CEO and board level confidence derived from higher public valuations, a continued focus on growth, scale and diversification, private equity involvement as both buyers and sellers, and the gradual consolidation of the reinsurance sector driven in part by third party capital involvement."

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HRG Air Trends Survey Indicates Upward Trend For Business Travel Market

Despite an unprecedented number of disruptions over the last year business air travel is showing encouraging signs of recovery, with travel to emerging markets in Africa and Latin America leading the charge, according to data released today by Hogg Robinson Group (HRG), the award-winning international corporate services company.

Data based on HRG UK clients' domestic and international air transactions and fares from April 2012 to March 2013 indicates that:

Despite ongoing challenges, particularly in the Eurozone economies, there are signs that the business travel market is on the road to recovery. Global air travel booking activity in the first quarter of 2013 was up 3.2% compared to the same period in 2012. After a shaky start to 2012, the number of UK domestic transactions increased by 2.6% in the fourth quarter of 2012, and rose by 4.3% in the first quarter of 2013.

India was among the destinations where HRG saw the strongest growth in corporate air travel. Year on year transaction volumes were up by 11.1%. Corporate air travel to the Rest of the World region, encompassing the emerging markets of South East Asia, Latin America, and Africa grew by 3.3%.

Transaction volumes in Brazil and China declined by 6.1 and 2.3% respectively, as the economies in both countries began to slow after breakneck growth in previous years. Business class transactions showed an overall decrease of 14.8% with economy transactions recording an overall increase of 0.5%.

The shift from business class to economy was particularly acute in Europe suggesting changes made by business travellers on short haul routes during the peak of the downturn has extended well beyond it. Stewart Harvey, Group Commercial Director of HRG says: “The general picture is of an industry in slow but steady recovery. However, despite the improved view there is still a focus on cost by our clients and an increase in the use of economy fares, particularly on short-haul destinations. We’re also seeing rail re-emerge as a genuine alternative to air travel.

“Getting the best value for money when it comes to air fares, and aligning travel budgets to match high growth markets are the priorities for our clients as they look to make a limited pot go further. “The BRIC countries (Brazil, Russia, India and China) are now well established business travel destinations and, with the exception of India, the huge growth in air travel to these destinations is slowing. What we’re seeing now is significant growth coming from smaller, less established destinations, like Colombia in Latin America, and Ghana in Africa. These countries are poised for massive growth over the next decade as more international routes open up.”

Encouraging signs after challenging 2012

HRG figures show that corporate travel is on the rise after a challenging period in the second and third quarters of 2012. Transaction volumes recovered in the final quarter of 2012, showing 0.5% year on year growth, and this continued into the first quarter of 2013, when transaction volumes rose by 3.2%.

HRG’s findings are supported by the latest data from IATA, which reported 5.9% rise in the number of passenger kilometres travelled globally in March 2013. Despite cautious optimism however, HRG figures indicate the picture remains mixed, with a number of clients still showing significant reductions in travel.

Global picture mixed with emerging markets underpinning growth

HRG’s Air Trends data shows evidence of an upward trend in business travel transactions and spend across all regions, though the pace of recovery varies significantly.

Growth in the Rest of the World region, encompassing the dynamic economies of Latin America, South East Asia and Africa, grew by 3.3%, providing further evidence that businesses are prioritising travel to emerging economies rather than traditional economic hubs in the West.

Year on year transaction volumes for UK domestic travel dropped by 2.9% while the rest of Europe showed a similar rate of decline at -2.7% for the year. Corporate air travel to the North Atlantic region decreased by 3.9%.

UK and Europe – Mixed picture as economic conditions remains uncertain

UK domestic travel dipped sharply in the second and third quarters of 2012, but recovered in the final quarter with year on year transaction growth of 2.6%. This growth continued into the first quarter of 2013, when UK domestic air transactions rose by 4.3% compared to the same period in 2012.

While the dip in air travel to mainland Europe was not as pronounced, the recovery has been slower, with the prolonged Eurozone crisis continuing to impact growth. The fragile economic situation across Southern Europe has led to signifcant reductions in air travel to Portugal (-20.1%) Italy (-14.6%) and Greece (-15.3%).

Germany emerged the most popular international air travel destination for HRG clients due to its position as a leading commercial centre, though even here transaction volumes were down 1.5%. Strong economic growth conditions and revenue opportunites across Northern Europe and Scandinavia drove a significant rise in air travel to the region.

HRG data shows an 11.5% rise in air travel to Norway and a 16.9% rise to Denmark. Interestingly, transactions for flights to France decreased by 5.2% between April 2012 to March 2013 when compared with the previous year. HRG figures reveal an increasing trend for business travellers to travel to France using high-speed rail services including Eurostar.

Many companies have also changed their travel policy, requiring travellers to travel by rail for this particular route as it allows for work to be completed en-route.

Latin America – Dynamism beyond Brazil

Latin America continues to grow as a business travel destination, but data from HRG indicates the pace of change is slowing in more established markets like Brazil. While air travel to Brazil has grown exponentially over the past five years, HRG’s data showed a year on year decline of 6.1% in terms of transactions.

As part of the exclusive ‘BRIC club’ Brazil may grab the headlines, but the opening of new international routes across Latin America is underpinning strong growth in air travel to less established destinations across the entire region. Peru (+18.2%), Chile (+16.7%), and Colombia (+36.2%) are all emerging as business travel destinations as international companies recognise investment opportunities in these smaller countries.

Middle East and North Africa – Bouncing back

Air travel to the Middle East and North Africa is showing signs of improvement after hitting rock bottom during the social-political uprisings of the last 18 months. Travel to booming Turkey rose by 11.5% year on year. HRG’s data also showed an increase in corporate travel to Saudi Arabia (+9.1%) and UAE (+5.3%), but business travel to Bahrain remains stymied by ongoing political unrest.

Air travel transactions to the Kingdom were down 13.3% year on year. In North Africa, inbound air travel to Tunisia is down by 22.7%, while air travel to Egypt declined by 2.7%. There are however signs this may be changing as Foreign Direct Investment is beginning to have an impact on business travel to the region.

Africa – Rising fast

Boosted by a plethora of new airline routes into Africa and a successful football World Cup in June 2010, the continent is gradually emerging as a desirable destination for business travel. Compared to the sluggish pace of growth in Europe, transaction volumes in Africa are rising at often eye-watering rates, albeit these rises are often from a low starting base. Inbound travel to Ghana was up 50.4%, and 14.8% to South Africa.

Asia – China stalls as India powers back

China may be tipped to overtake the US as the world’s biggest business travel destination by 2015, but even the world’s second largest economy has not been spared some economic hardship over the past year.

A slight slowdown in growth from the blistering pace we have become accustomed to is reflected in the 2.3% decline in year on year air travel transactions reported. Conversely, India was one of the major growth regions identified by HRG’s air trends data, showing year on year growth of 11.1%

United States – Feeling the pinch in 2012

Air travel transactions to the US dropped sharply in 2012, showing a year on year decline of 4.2%. In a sign that air travel to the North Atlantic region has yet to recover, Delta Air Lines, one of the US’s two biggest airlines by revenues, warned of a fall in demand in March and expected unit revenues to fall 2 to 3 per cent in April, as it experienced the impact of a weakening US economy.

Cabin classes – Belt-tightening hits business class

Business class transactions have declined dramatically across domestic and short-haul destinations in mainland Europe with drops of 22% and 45% respectively. Economy and low-cost carrier transactions on short-haul destinations in Europe rose by 1% and 4% respectively, suggesting a widespread shift in travel policy on these routes.

In the UK, economy and low-cost fares were down 1% and 9% respectively, indicating UK domestic business travellers may be swapping air travel for rail, and holding more meetings remotely. Belt-tightening is also extending to cabin classes on some long-haul destinations. HRG reports that while transactions to the Rest of World region are up on the previous year, business class transactions remained flat with the majority of the year on year rise accounted for by economy and premium economy fares.

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Travel Industry Targeting High-End Families

WikiTrend.org, the social trends catalogue for trendsetting ideas, products and experiences, is reporting a growing trend in travel and tourism in looking to attract families in general, and wealthy families in particular. Family travel is growing, but high-earning families are traveling even more, and their spending is increasingly attractive to travel providers.

State and city Convention and Visitor Bureaus (CVBs) are reporting a rise in destination family reunions, which guarantees a large number of people traveling to the same location on any given date. Meanwhile, airlines and hotels are competing for the privilege of pampering families seeking luxury travel experiences. Etihad Airways, the national airline of the United Arab Emirates, is now offering on-board nannies to watch and entertain children in-flight.

The Trump SoHo, an upscale hotel in New York City, is offering children under the age of 17 the opportunity to live like young entrepreneurs, equipping them with business cards, monogramed robes, and etiquette classes.

The Mark, another New York City hotel offers branded MacLaren baby strollers designed in the hotel's signature black and white stripes for high rollers with tots in tow. The sell to guests is that they can leave their strollers at home, and not have to lug this unwieldy piece of equipment. Instead, they have full use of the hotel's very chic strollers for the entire length of their stay.

"As people look towards family travel to fulfill their need for meaningful experiences, the competition for this business will heat up even further," says trends expert and keynote speaker Daniel Levine, who is also the Global Editor of WikiTrend.org, "With an increasing number of wealthy families looking to share experiences, travel stakeholders are becoming ever more innovative in making high-end travel more appealing for kids and parents alike."

About WikiTrend.org

Updated daily, WikiTrend.org is the home of trendsetting ideas, products and experiences for fun, insight, inspiration and profit. For thinkers, entrepreneurs, innovators and marketers, WikiTrend.org is a fantastic resource offering powerful insight into what global consumers are thinking and feeling. Find them on the Web at www.WikiTrend.org.

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Travel Advice Côte d'Ivoire

Travel Advice Côte d'Ivoire

Latest update: Summary and Safety and security, Crime section - reports of westerners being robbed at gunpoint on the main road from Abidjan to Yamoussoukro.

The FCO advise against all but essential travel to parts of the country.

The Foreign and Commonwealth Office (FCO) advise against all but essential travel to the western regions of Dix-Huit Montagnes, Haut-Sassandra, Moyen-Cavally and Bas-Sassandra. There have been a number of shootings around Abidjan since August 2012. Attacks happen mainly at night and the targets have usually been the police and military. Further incidents can’t be ruled out. Violent crime can occur at any time.

Be particularly vigilant and take care when travelling by road, especially at night. There is a general threat from terrorism.

Following French military intervention in Mali, there is a possibility of retaliatory attacks targeting Western interests in the region.

You should be vigilant. Cases of meningitis have been detected in northern and central regions of Côte d’Ivoire. The affected districts are Boundiali, Bouna, Ferke, Korhogo, Seguela and Tengrela in the North and Bandama Valley region in the central part of the country.

The World Health Organization (WHO) and other international health agencies are supporting local authorities to control the spread of the disease. Yellow fever, cholera, and measles cases have been reported in the Abidjan area since the start of 2011. Falciparum malaria is also endemic. You should register with our Embassy and warden network in Abidjan.

Take out comprehensive travel and medical insurance before you travel.

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Healthcare Insurance & Group Risk Protection 5th June 2013 The Charing Cross Hotel, London, UK

Health Insurance and Group Risk Protection, created by the sister company of HI Magazine, is the industry's first independently researched conference looking at the latest issues driving the PMI market. This event is targeted at leading Employee Benefit Consultancies, Brokers, Intermediaries and IFAs and provides practical information to help drive forward your business and improve yourself professionally.

About Informa Life Sciences

Informa Life Sciences lead the market in providing quality, expert-led conferences; delivering the expert knowledge our clients need to excel in their professional roles and guaranteeing a competitive advantage for their organisations. Our diverse portfolio covers the Pharmaceutical (Drug Discovery, Clinical Development, Regulatory Affairs, Biopharmaceutical, Generics and Business Strategy), Medical Devices and Diagnostics, Fine Chemicals and Agrochemicals and Veterinary Medicine arenas.

Discover more information at http://www.informa-ls.com

About Health Insurance Magazine

Health Insurance is a magazine for professional intermediaries who are involved in selling health insurance and protection products to both individuals and companies. By reading regular copies you will benefit from frequent coverage of developments in all health insurance product areas - including private medical insurance, long term care, critical illness, income protection, employee benefits and business protection - which means that you can offer objective advice to your clients across the broadest possible product base. Each month you will benefit from probing articles that cover all aspects of your daily work - from improving your product and portfolio knowledge and advising you on market developments and trends to identifying new business opportunities. You will be told of key events in the news that affect your profession and will benefit from in-depth features, which provide an objective and no-holds-barred examination of the issues that affect you. Comprising a readership of independent financial advisers, specialist health insurance intermediaries and insurance brokers, Health Insurance is your key to offering a better service and to developing the profitability of your business. Health Insurance is sent free to qualifying individuals, click here to register for your free copy.

Visit http://www.hi-mag.com

About iPMI Magazine

International Private Medical Insurance Magazine (iPMIM) is the ultimate Private Medical Insurance online platform serving expatriate, corporate, health and travel insurance markets. Due to the nomadic nature of the international healthcare industry iPMI Magazine is an internet based news service or worldwide healthcare professionals, who need to understand the impacts of healthcare and insurance policy, regulatory, and legislative developments.

Log on to http://www.ipmimagazine.com

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Totally Expat London, Business Design Centre, Islington, May 20th 2013

Meet International Private Medical Insurance Magazine at Totally Expat London, Business Design Centre, Islington, May 20th 2013.

The London Totally Expat Show is now Europe’s largest ever global mobility conference and exhibition with over 100 exhibitors, 30 technical sessions running throughout the day and over 1000 attendees. It takes place on 20 May at the Business Design Centre, Islington and is the must-attend event of the year for all European based global mobility professionals.

As with all our events, in-house HR/global mobility professionals attend free so book your place now to gain the contacts, knowledge and information you need to make every assignment productive and cost-effective! Our best-ever conference will include insightful, practical sessions covering the key issues in global mobility now.

Read iPMI Magazine's report on last years Totally Expat Show, which we also supported as a media partner and exhibitor. 

Visit http://totallyexpat.com to book your tickets today.

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iPMI Magazine speaks to Mr. Brian Friedman, Founder and CEO, The Forum For Expatriate Management

iPMI Magazine speaks to Mr. Brian Friedman, Founder and CEO, The Forum For Expatriate Management

Brian Friedman is the Founder and CEO of The Forum for Expatriate Management. A 30 year plus veteran of the Global Mobility profession, Brian was formerly CEO of both Ernst & Young's and previously Arthur Andersen's Human Capital Practice. Brian is uniquely triple qualified as a Fellow of the Institute for Personnel and Development, a Fellow of the Institute of Taxation and a Chartered Accountant. Brian also holds a Masters degree in Economics from St John's College, Cambridge University. Brian is the author of 4 books on the subject of International Compensation and HR, including "Effective Staff Incentives". He was also the co-author with David M Walker (former Comptroller General of the United States) of the groundbreaking book "Delivering on the Promise" which was a Number 1 business book bestseller in the United States.

The Forum for Expatriate Management is a membership organisation for all Global Mobility professionals. Membership is free to anyone who works full-time is any area of expatriate management - including HR, tax, health & welfare, financial services, relocation etc. Over the coming months we will be launching a wide range of seminars, surveys, networking events and on-line forums. Join now - and recommend us to your colleagues. Just apply to join our linked-in group. You can also visit our website at www.totallyexpat.memberlodge.com. Specialties: Global Mobility, Expatriate Tax, Business, Immigration, Executive Compensation, Equity, Incentives, Outsourcing, Vendor Mangement.

Please introduce yourself and your back ground in the expatriate marketplace

I have lived and breathed “expat” for nearly 30 years. For many years I was the Managing Partner of Arthur Andersen’s and latterly Ernst & Young’s Human Capital practice. After I retired from professional practice, I set about fulfilling my dream of establishing Global Mobility as a profession in its own right rather than as an adjunct to other specializations. To me Global Mobility is not tax, healthcare, immigration, accommodation, shipping, banking and the rest – it’s all of them combined into a uniquely global solution.

What is important to expatriates in 2012 and what do they want?

Global Mobility is set to increase but in difficult times we do see changes in focus. Today’s focus is on cost control, risk management and value for money. Expats get exasperated when things that were easy back home become unnecessarily complicated once they move cross-border. Anyone who has tried to open a foreign bank account or lease a car without a local credit history will know those feelings of frustration. In short, expats want to enjoy their expat lifestyle without the accompanying frustrations of living abroad.

How does The Forum For Expatriate Management support and manage the lifecycle of an expatriate and their loved ones?

The FEM does not provide any services directly to expats. We are a Business to Business news portal and events company for anyone who is professionally involved in moving employees internationally. Our website is the pre-eminent source of information for anyone in the Global Mobility industry and our events are the flagship industry events worldwide.

The London Totally Expat Show 2011, was an outstanding success with the Totally Expat Show 2012 moving to the Business Design Centre in London on the 14th May 2012. What will be the major focus of the event this year, and what should visitors be sure not to miss?

We will have over 30 different technical sessions covering all areas of Global Mobility. We are expecting over 800 attendees and have an amazing exhibition featuring 100 different service providers. We are covering all angles including international medical, international schools, tax, immigration, talent management, technology and much more. We are also featuring corporate panels with representatives from such prestigious companies as HSBC, AstraZeneca, Aviva, BAe Systemsn, Electronic Arts, GKN, ThomsonReuters, Diageo, Experian, Pearson and many more.

Celebrating excellence in global mobility, the EMMAs are the only global awards that truly recognize the expatriate industry leaders, business successes and rising stars. What can we expect at this year’s awards?

This year we are hosting the EMMAs in 3 locations – Las Vegas on 13 September (for the Americas), London on 19 October (for Europe) and Hong Kong on 28 November (for Asia Pacific). Last year we have over 500 nominations and this year we are on target for nearly 1000. The EMMAs are the Oscars of the Global Mobility profession. Winning an EMMA is the ultimate accolade and the Awards ceremonies are evenings that are now legendary within our profession.

The USA Totally Expat Show 2012 takes place June 1st 2012 in Chicago, USA. Chicago is one of the USA’s biggest centers for Global Mobility with HR Professionals enjoying free attendance. What have you got in store for us @ the 1st Totally Expat Show in the US?

We have hosted Totally Expat Shows before in New York and Houston and we held a conference in Chicago last year. This year’s Chicago Totally Expat Show will feature over 9 hours of technical sessions and an exhibition of 24 leading service providers. We are expecting about 250 attendees. We think a major draw will be the corporate panel sessions featuring such blue chip companies as Kraft, Whirlpool, General Motors, PwC, Navistar and many others.

Where do see healthcare and insurance appearing, on the list of priorities of an expatriate?

Healthcare and insurance is never as high on the list of priorities as it should be. Too many expatriates take unnecessary risks by not having appropriate levels of cover. We do get a fair number of healthcare and insurance providers exhibiting and attending our events so hopefully we are together raising awareness. We encourage all iPMI readers to attend our events and to join the online FEM community at www.totallyexpat.com.

The iPMI Magazine readership is worldwide. We have readers within Insurance and Travel/Medical Assistance, and from industry verticals like Oil and Gas, Construction, Media, Retail, Mining, Military, EMS, Travel, Hospitality and Aviation. What opportunities exist for such company’s @ The Totally Expat Show and EMMAs?

We have a number of Awards that iPMI readers can be nominated for. The most relevant are International Benefits Provider of the Year as well as Global Mobility Professional of the Year and Rising Star. From a corporate perspective we have awards for small, medium and large Mobility programs as well as a wide number of industry specific awards (eg best Global Mobility program in the Oil and Gas Sector). Other relevant awards include Best Practice in Challenging Locations and Best Vendor/Corporate Partnership.

What will the Expatriate market place look like in 5 years time and what role will technology play in accelerating the growth and development of the business?

Globalization and Global Mobility are the defining mega-trends of our time and probably of all time. The need to explore our environment is deep within our psyche and the only limiting factor is the enabling technology. As technology expands so does global mobility. That is a trend that underpins society and will only be restricted if external calamities (such as war or natural disaster) prevents people from moving freely and safely cross-border. People often say that communication technology (such as video-conference or Skype) means that people don’t need to travel so much. Personally, I don’t believe it for a moment – technology will encourage businesses to globalize further and that will inevitably mean more international business travelers, assignees and international retirees.

Last but not least: If you could live anywhere in the world, at land or at sea, where would it be?

I love travel so would find it hard to settle down anywhere. My favorite countries in the world are Australia and New Zealand. But I also love Tuscany and Languedoc. Probably, I should just retire to a cruise liner and just keep travelling !! `

Meet iPMI Magazine @ The Totally Expat Shows and EMMAs - email This email address is being protected from spambots. You need JavaScript enabled to view it. to set up a meeting

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