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Activities Industry Mutual Limited August 2005 Newsletter
Benefits of the CTBS Industry-Wide Risk Assessment Survey. It is probably no coincidence that, following the very well supported CTBS Insurance Solutions (CTBS) survey of AALA licensed activities providers of 2003/04, there has been a detectable change in some insurers’ perception of the sector. A few commercial insurers that abandoned activities providers or imposed punitive premium increases and restrictions in cover just a few years ago are now back and looking at the sector with interest once more. Insurance companies and Lloyd’s syndicates, are by their nature opportunistic and short term, looking to exploit market anomalies. They will charge what the market can bear and drive the cycle from a hard market (scarcity of cover, high premiums and profits) to a soft market (low premiums and losses) then back again to the hard market.
New Insurance Schemes - short term panacea or long term solution? Independent insurance brokers CTBS and Charles Taylor Consulting plc (CTC), a professional firm of mutual managers, have teamed up and initiated a radical and long term resolution in the formation of the Activities Industry Mutual Limited (AIM), a mutual specifically for the outdoor sector, for liability and property insurance. A mutual is a non profit making organisation whose members pool risks of a similar nature to achieve long term and stable insurance protection at cost – a form of insurance with antecedents going back many hundreds of years. The key distinguishing feature of a mutual is the alignment of its interests with those of its members, for example: • Profits or surpluses are utilised for the benefit of its members, either as increased reserves or distributions back to members. • The mutual pays no commissions or payments to third party brokers or "business introducers" nor does it pay dividends to shareholders. • Alignment of the mutual’s and the reinsurer’s interests by means of a long term partnership commitment and a profit sharing agreement in favour of the mutual.
Membership Invitation Enclosed is an invitation to become an Associate Member of AIM and also to attend a regional meeting scheduled for October. No cost or obligation is involved. Prior to your insurance renewal date, we will be in touch with you in order to provide you with a new and alternative insurance quotation. Initially AIM will be targeting providers with a turnover in excess of £75,000 until we have built up sufficient premium to be able to broaden the criteria to include a wider range of prospective members. However, also from the outset, we will be welcoming Associate Members with a turnover below the £75,000 initial threshold.
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