Insurance

New U.S. healthcare plan is in critical condition

7 Mar 2017

After deriding Obamacare for years, Republicans have rolled out an alternative afflicted with financial and political problems. It would worsen insurance-exchange woes, raise costs for many Americans and weaken Medicare. The prognosis from Washington and Wall Street is dire.

Standard Life gets weak upper hand in fund merger

6 Mar 2017

The Scottish asset manager is effectively taking over rival Aberdeen without paying a premium. That cushions it from the risk that teams don’t get on and clients snaffle the benefits. Yet embattled Aberdeen boss Martin Gilbert has also done better than might have been expected.

Cigna-Anthem slugfest may leave both deal-impaired

1 Mar 2017

The two U.S. healthcare insurers are knocking each other around in court over their busted $54 bln merger. Anthem hopes to avoid paying a break fee, while Cigna wants $13 bln in damages. As they fight what are likely to be losing battles, they could miss other M&A opportunities.

Hadas: Enough with the cult of Warren Buffett

1 Mar 2017

The sage of Omaha's folk wisdom and America cheerleading have been big factors in the unwarranted worship of his style of financial capitalism. Buffett's investing prowess is laudable. He is, however, a big winner in a zero-sum game, and that actually does little for the economy.

Rate tweak whiplashes UK insurers

27 Feb 2017

Insurance companies will have to pay more for injury claims after the government said payouts must be discounted at a negative rate. The metric was too high before, and arguably still is. The real mystery, though, is why financial risk ends up with claimants, not insurers.

Intesa’s Generali drama leaves it needing encore

27 Feb 2017

The Italian lender’s abandoned bid for insurer Generali puts both under pressure to appease shareholders. The former target can cut costs, and slim down. Intesa chief Carlo Messina’s challenge is harder - to diversify from banking in an unstable political environment.

Britain’s takeover regime is worth exporting

24 Feb 2017

“Put up or shut up” rules tightened after Kraft’s Cadbury deal have led to more deals where the bidder makes a firm offer, UK data shows. Generali, currently being stalked by Intesa Sanpaolo, will be envious. It would benefit if something similar was implemented in Italy.

AIA’s bullish talk contrasts with cash caution

24 Feb 2017

The Asian insurance juggernaut has weathered the clampdown on Chinese capital outflows well, clocking up another bumper year. New business soared 28 pct and a key profit measure rose 15 pct. But management's confidence is not quite matched by its dividend plans.

RSA flies the flag for insurance simplicity

23 Feb 2017

The UK group’s operating profit rose by a quarter in 2016, pushing its shares up 6 pct. The results vindicate CEO Stephen Hester’s small-is-beautiful strategy. Diversified giants like Axa and Allianz should benefit from scale. But performance - and valuations - suggest otherwise.

AIG digs out of lengthy Stowe snow-blindness

21 Feb 2017

The insurer is offloading the Vermont resort, built by its founder because he hated waiting in line. For Vail Resorts, the $50 mln deal nearly completes its American ski roll-up. Investors should welcome anything that helps focus management at AIG, which lost $3 bln last quarter.

Chinese insurers put too many eggs in one basket

20 Feb 2017

Life insurers are betting increasingly large amounts on individual stocks. The risk is that a single default could hit them hard. The local regulator is trying to curb this practice - but doing so could put paid to the industry's penchant for large acquisitions.

Allianz’s 3 bln euro buyback is a figleaf

17 Feb 2017

A rigid policy inherited from his predecessor means boss Oliver Baete must hand back an unused war chest to shareholders. This doesn't signal a lost appetite for big deals. Allianz can raise over 30 bln euros in new stock at the stroke of a pen, whether investors like it or not.

AIG’s crisis hangover has Peter Hancock flailing

16 Feb 2017

The insurer's CEO presided over a $3 bln quarterly loss that wiped 10 pct off the stock. That was in part caused by taking a hit on policies written to help AIG recover after its 2008 collapse. Unless Hancock can prove he is getting a handle on risk, his job is on the line.

Mediobanca can plan lengthy stay in shop window

9 Feb 2017

The Italian bank's financials are solid yet its future is in doubt if Generali, in which its holds a 13 pct stake, is sold. Mediobanca's simplest plan would be to sell itself to a larger bank. But Plan B, in which CEO Alberto Nagel focuses on his own deals, looks more promising.

One battle may remain for Anthem and Cigna

9 Feb 2017

A federal judge has nixed their $54 bln deal, agreeing with the Justice Department's competition concerns. In addition to fighting the government, Anthem and Cigna were squabbling with each other over the merger. That suggests the $1.85 bln break fee could be contentious, too.

SocGen gets stress test joker with asset shuffle

9 Feb 2017

The French bank is buying an insurer for 500 million euros and will list part of its car leasing unit. Societe Generale wants to grow each business. But with stress tests kinder on insurance than banking, and auto loans treated fairly harshly, there could be a secondary benefit.

Intesa-Generali may rest on regulatory swerve

31 Jan 2017

The Italian bank's interest in Generali looks like a dud, but the deal's math could be improved by a capital loophole that flatters bank investment in insurers. The ECB might balk at such fiddles. Then again, that may be Generali’s best shot at staying single.

Generali dark arts still allow Intesa bid

24 Jan 2017

The Italian insurer has snapped up a stake in the country’s largest bank, rumoured to be planning a takeover with Allianz. The step makes it harder for Intesa Sanpaolo to build a stake in Generali and wield influence. But as the market has noticed, it can still launch a bid.

Judge, not Trump, kills U.S. health insurer love-in

23 Jan 2017

Aetna's $34 bln deal for rival Humana was crushed on antitrust grounds in court. That bodes poorly for Anthem's star-crossed $46 bln Cigna bid. It's a mercy killing for the firms' shareholders, who watched UnitedHealth, which sat out consolidation, gobble up market share.

Generali woes defy easy M&A solution

23 Jan 2017

The Italian insurer's stock jumped on talk of a takeover by German Allianz. Any deal could face antitrust challenges. A carve-up by rivals might make more sense but is still complex, and politically fraught. For shareholders, the road to value creation looks long and arduous.