Adams, Michael "Australian Corporate Governance:
AAP, compiled by Rob Lundie. Shareholders of HIH are likely to incur significant losses on their investment, perhaps their entire capital. The extent of these losses will be revealed over time.
Immediately following the collapse of HIH, numerous reports appeared in the press about HIH policyholders not having their insurance contracts honored and their claims not paid.
This section discusses how different policyholders were affected immediately after the collapse. Prior to and after the collapse of HIH, a substantial number of policyholders with particular types of insurance had their policies taken over and honoured by other insurers.
Explain which policyholders have had their policies taken over by other companies Identifies those policyholders with HIH and its subsidiaries that were at risk of suffering financial loss by not having their insurance contracts honored and claims paid, and Identifies policyholders that may need to take out new insurance cover.
Accordingly, policies in these categories do not need to be replaced. For any other personal and domestic insurance products not listed above, customers should obtain advice as to whether they need to obtain alternative insurance cover.
Claims on policies in prior periods of insurance and in respect of those policies not covered by the Allianz arrangements, will constitute claims against HIH and will not be paid at this time.
There is therefore a real risk that personal and domestic policy claims with the exception of CTP claims made on policies not current at 1 January and on policies not covered by the Allianz arrangements, may not be capable of being fully satisfied.
According to the provisional liquidator, CTP policy claims will be met in full either by Allianz policies current at, or issued by Allianz since 1 January or through the relevant state statutory schemes regardless of when the policy was issued.
Accordingly, current CTP policies do not need to be replaced and normal claims processes remain in place. Accordingly, current policies in this category of insurance do not need to be replaced.
Accordingly, most current policies in this category of insurance do not need to be replaced. Small business, rural and commercial insurance policy customers that are not covered under the Allianz arrangements should contact their broker or adviser to confirm the current status of their policy Claims on policies in prior periods of insurance and in respect of those policies not covered through the Allianz arrangements will constitute claims against HIH and will not be paid at this time.
There is therefore a real risk that small business, rural and commercial insurance policy claims made on policies not current at 1 January and on policies not covered by the Allianz arrangements, may not be capable of being fully satisfied.
Travellers whose insurance cover was in question should now be protected by new arrangements. QBE reached in principle agreement with the provisional liquidators to assume responsibility for all the existing travel insurance liabilities of HIH where premiums were written in Australia.
When details of the arrangement are finalised, it will remove the uncertainty surrounding those people who had commenced travel in Australia or overseas prior to 17 March.
In due course, those people should be automatically covered for medical and hospital emergencies and other valid travel claims. The Australian Securities and Investments Commission ASIC advises that it is important to note that much travel insurance is prominently badged by organisations other than the insurer, such as travel agencies or airlines.
Some of these policies will have been sold under the name of "Readyplan".
This would be provided for an additional premium and after meeting certain conditions. The provisional liquidator advises that outstanding claims in respect of these types of policies and any unexpired premium will constitute claims against HIH.Such was the demise of HIH Insurance Limited (HIH): both a surprise (to many) and very bad news for many policyholders.
On Thursday, 15 March , HIH received approval from the NSW Supreme Court to place HIH into provisional liquidation. corporate failure for HIH insurance 1. CORPORATE FAILURE OF HIH INSURANCE 2. COMPANY BACKGROUND AND ORIGIN • HIH Insurance was founded in by Ray Williams and Michael Payne and at this time it was known as “ M W Payne Underwriting Agency Pty Ltd “ • It was acquired in by British company CE Heath PLC and Ray Williams was appointed to the board of CE Heath PLC.
HOW THE COLLAPSE OF ONETEL AND HIH INSURANCE CHANGED CORPORATE GOVERNANCE IN AUSTRALIA Background The first years of the 21st century were remarkable for a number of high profile corporate collapses, most notably in the US, Enron and WorldCom and, in Australia, OneTel, HIH Insurance, Harris Scarfe and Ansett Airlines.
the existence of, and adherence to, satisfactory risk management programs, including satisfactory corporate governance structures and processes, may become an important factor in assessing price and terms for specific classes of corporate insurance cover, including directors' and officers' liability cover.
Australian Case Study in Corporate Governance â€“ Hih Insurance; Australian Case Study in Corporate Governance â€“ Hih Insurance. Words Jun 2nd, 20 Pages. by their own poor example and failure to uphold high ethical standards, allowed a culture to flourish in which secrecy, rule-breaking and fraudulent behaviour became.
Corporate governance is ‘the framework of rules, relationships, systems and processes within and by which authority is exercised and controlled in corporations’. It encompasses the mechanisms by which companies, and those in control, are held to account.