What’s new: In brief (December 07, 2004)

The Council of Insurance Agents & Brokers (CIAB) has added its endorsement to the draft model regulations around broker compensation proposed by the National Association of Insurance Commissioners (NAIC). The CIAB says, however, it wants to see uniform regulations in place in all states, and a uniform approach to investigation of commission practices rather than the uncoordinated approach currently being taken. “We are disappointed there has not been more of a move toward a uniform coordinated approach and urge states to continue to work together to develop and use a single inquiry form, and to limit their inquires to their domestic companies and resident producers,” says council president Ken Crerar.

The Canadian Condominium Institute (CCI) has made public its “national risk management program” which will guide member condo corporations to better mitigate risk and “resolve responsibility issues between corporations and owners”. “It is hoped over time that the risk
management protocol will create an environment where insurers and their
condominium clients will effect a more balanced, consistent insurance
relationship,” says CCI president Peter Leong.

Fairfax Financial Holdings (TSX, NYSE: FFH) says it will sell US$200 million of its 7.75% senior notes due 2012 at an issue price of 99%. The proceeds will be used to repurchase US$112 million in debt tendered thus far as part of an offering announced in mid-November. The funds will also be used to buy back other Fairfax debt, including a EUR45.7 million vendor note due 2007. CEO Prem Watsa says following the offer the company will have completed its goals in terms of buying back debt, with the issuance of US$300 million in new equity and retiring US$409.7 million in debt due between 2005 and 2008. In this respect it will have “effectively removed refinancing risk until 2012”. The current offering is set to close on December 21, 2004.