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Chase Bank Limits Cash Withdrawals, Bans International... Before you read this report, remember to sign up to http://pennystockpaycheck.com for 100% free stock alerts Chase Bank has moved to limit cash withdrawals while banning business customers from sending...

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Richemont chairman Johann Rupert to take 'grey gap... Billionaire 62-year-old to take 12 months off from Cartier and Montblanc luxury goods groupRichemont's chairman and founder Johann Rupert is to take a year off from September, leaving management of the...

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Cambodia: aftermath of fatal shoe factory collapse... Workers clear rubble following the collapse of a shoe factory in Kampong Speu, Cambodia, on Thursday

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Spate of recent shock departures by 50-something CEOs While the rising financial rewards of running a modern multinational have been well publicised, executive recruiters say the pressures of the job have also been ratcheted upOn approaching his 60th birthday...

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UK Uncut loses legal challenge over Goldman Sachs tax... While judge agreed the deal was 'not a glorious episode in the history of the Revenue', he ruled it was not unlawfulCampaign group UK Uncut Legal Action has lost its high court challenge over the legality...

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Britain is turning it’s back on co-operative insurance

Category : Business

Plans to sell off the Co-operative Group’s insurance operations will mark a historic shift, while appetite for co-op insurance continues elsewhere

The Co-operative Group recently announced that it wants to sell off its general insurance operations. If it goes ahead, it will mean the end of almost a century and a half of co-operative insurance in Britain.

The original Co-operative Insurance Society (CIS) was set up in 1867 to provide fire insurance for the rapidly increasing number of retail societies within the co-operative movement. In 1912, it became part of what is now the Co-operative Group following a take-over by the co-operative wholesale societies.

Despite suffering a £662m loss, the group maintains that the general insurance sale is still part of its strategy, following the sale of its life insurance and fund management business. Barring last-minute regulatory issues, Royal London is set to acquire this side of the old CIS business for £219m.

But although Britain is turning its back on co-operative insurance, the rest of the world is not. The desire of co-operatives to be able to insure with one of their own — rather than through a commercial insurer — has allowed successful insurers to become established throughout the global co-operative movement. Indeed, the world’s largest co-operative, Zenkyoren, gets its massive £70bn annual turnover from servicing the needs of the country’s agricultural co-ops.

Zenkyoren was set up in 1951. Six years earlier, a similar process in Canada saw the creation of what has become the Co-operators insurance company, now operating throughout the country. It markets itself on its co-operative ethos and principles and has taken a particularly strong line on issues around sustainability and corporate social responsibility. Like Zenkyoren and most other co-operative insurers, however, it is not directly owned by individual members: it’s a ‘secondary co-op’. It is collectively owned by a consortium of forty-five Canadian co-ops, credit unions and other organisations who jointly appoint its board and share its financial success.

And the impulse which led to Zenkyoren and the Co-operators is still very much alive. In Malawi, for instance, credit unions and co-ops are working hard to create their own national co-operative insurance company. The country’s federation of savings and credit co-operatives, MUSCCO, which already offers basic loan protection insurance, is making common cause with agricultural and consumer co-ops to try to raise enough capital to license a new insurer.

But collectively, co-op insurers are feeling rather chipper at the moment: the market share of the total insurance business held by them has been climbing since the financial crash. According to the International Co-operative and Mutual Insurance Federation (ICMIF), the insurance market share held by co-ops and mutuals has climbed from 23.7% in 2007 to nearly 27% today.

ICMIF is unusual among the international sectorial co-operative federations in having opened its membership to mutual insurers as well as co-operatives. It’s CEO, Shaun Tarbuck, argues that this growth is a direct result of popular disenchantment with shareholder-owned financial businesses with their focus on short-term profit maximisation. “I think organisations that have a values-based strategy are much more appealing to the general public,” he says.

He accepts that, until recently, co-ops and mutual insurers were often coy about promoting their different governance structure, but he says this is now changing. “We’re definitely seeing a trend towards organisations marketing their values, whether this is based on their being member-owned, on sharing profits or on business sustainability,” he says.

This sort of positive endorsement is a welcome turnaround from the situation during the dark days of demutualisation. Britain was particularly badly hit as, one by one, major mutual insurers like Standard Life, Norwich Union and Friends Provident followed the well-trodden building society route and turned themselves from member-owned institutions into plcs. Because of the demutualisations, Britain has now the smallest co-op and mutual market insurance share of any major economy, at around 6%.

The largest remaining life and pensions mutual is Royal London, so at least the Co-operative Group’s former life business will remain in the broader co-op and mutual family. The sale of the general insurance is much less advanced and could conceivably still be cancelled as the group tries to rebuild its long-term strategy following the Lloyds bid withdrawal. But, in the event of a sale, it would sell re-badged insurance products under the Co-operative Insurance name.

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Spain in fresh bid to revive economy

Category : World News

Spain is set to unveil new measures aimed at reviving the economy, a day after unemployment hit another record and with violent protests erupting in Madrid.

Originally posted here: Spain in fresh bid to revive economy

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Letta set to become Italy’s next PM

Category : Business, World News

Centre-left politician Enrico Letta appears set to become Italy’s prime minister, and pledges a change of direction on austerity.

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VIDEO: Apple results may reveal profits fall

Category : Business, World News

Apple will report its latest set of results on Tuesday, and analysts say it will reveal first fall in profits in a decade.

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Osborne to extend lending scheme

Category : World News

George Osborne is set to boost lending to small businesses as he faces growing pressure over his austerity policies.

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African growth ‘to outpace world’

Category : World News

Sub-Saharan Africa’s economic growth is set to outpace the global average over the next three years, according to the World Bank.

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Building firms blacklist angers MPs

Category : Business

Building firms which set up a “systematic blacklist” of workers do not appear to be taking full responsibility for their actions, according to MPs.

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Stocks may slip on slower China growth

Category : Business

Slower growth in China could set the tone for investors as they head into a week of first-quarter earnings.

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Banks, retail sales to set stocks tone

Category : Business, Stocks

Investors head into Friday morning awaiting quarterly results from two of the world’s largest banks and retail sales data after the Dow and S&P 500 set new record highs.

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Australia, China strike deal on currency

Category : Business

The Australian dollar is set to become only the third currency to trade directly with the Chinese yuan — a move that will help internationalize China’s currency.

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