Issue 67
April 2017
In this Issue
  • Chubb's Greenberg warns brokers
  • Markets may have more tools at their disposal
  • Stephen Catlin and Mike O'Halleran to retire
  • The coverage gap may be right under our noses
  • Flagstone co-founder Mark Byrne dies
  • Roger is worried about the future of his stock & trade; the placement of commas 
  • Quick Bytes: Malaysia Airlines seeks to avoid another MH370; Amazon sellers and Lloyd's; Buffett's stock appreciates faster than he can give it away; Ogden review may change how rate is based; John Nelson warns of costs at Lloyd's; 54 trillion EUR of wind exposure in Europe; Norman Rockwell returns courtesy of Chubb; icebergs plague North Atlantic; UK receives money from EU for flood relief; and PepsiCo accident sees tons of fruit juice emptied into Don River.

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Dear Colleague, 
Plus ça change, plus c'est la même chose. Sometimes we get the feeling that we're writing about the same trends and issues over and over again.  But this time it may be different.

Chubb has taken a very aggressive stance against broker behavior. Immediately a number of other carriers added their voice to the complaints voiced by Evan Greenberg and possibly we are seeing the beginning of a defined pushback against what markets seem to believe is bad behavior.  

Whether anything will result from this is of course unknown but several factors lead us to think that the high current acquisition cost and the increasing sophistication of models and technology may be providing markets with new weapons.

Pricing for the April 1 renewals seems to have been flat at best and at worst some business saw rate decreases of over 7%. The continued pressure of low premiums on carrier's ROE contrasts with market outcry against ever increasing acquisition costs.  Something, it seems, will have to give.

We note the retirements of Stephen Catlin and Mike O'Halleran both of whom can legitimately be called "giants" in the industry. They will be sorely missed both for their experience and for their civility.

Our regular Roger Crombie  column is here too. Roger is a writer and as you might guess can get easily worked up about popular trends corrupting his stock and trade --the written word. This column had us proofreading our text to ensure we didn't anger him.  

As always if you have any questions or comments about CATEX Reports , or want more information about CATEX , or our products, please feel free to contact me.
Thank you very much.
Stephanie A. Fucetola
Senior Vice President/CATEX

Shots fired: a 16 inch gun opens up

Often when you visit the offices of an insurer, reinsurer or broker, while sitting in the waiting area before you are ushered into the scheduled meeting, you may notice the firm's Annual Report on prominent display. Usually there are enough copies to convey the sense that taking a copy is permitted if not encouraged.  

One thing about Annual Reports is that they are just that --they are issued yearly and typically mailed to each stockholder of a company.  Annual reports then can live a life of their own.  Many firms, if you navigate through their websites, make available the Annual Reports from years past and you can be certain that analysts collect these missives as do no doubt many stockholders.

The Annual Report is usually an attractively packaged item, put together by the company with the understanding that the product will have a long shelf life and be available for the public to read at its convenience.  It would seem to us that every word of an Annual Report is reviewed, parsed over, argued about and discussed internally before inclusion in what is probably the most "official" communication a company has on a regular basis with its stockholders, analysts and the public.  

Thus when we read the Annual Letter of Chubb Chairman and CEO Evan Greenberg we understood that the letter, which introduces the company's Annual Report, had been labored over and carefully thought out. No one is incautious or reckless when writing an Annual Letter --not the CEO of a stock owned company and certainly not Evan Greenberg. Clearly, the message was a signal that had been approved from the very top of Chubb and a message that was meant to live on in those hard copy Annual Reports found in the waiting areas of Chubb offices dotting the world for the next 12 months.  Greenberg had something to say and he wanted his message to be as "official" as it could be and he wanted it to be distributed broadly and in as permanent a manner as he could deliver it.

Although Greenberg's Annual Letter was some 15 pages in length it was one paragraph in the second half of the letter that made the headlines.  The paragraph's first sentence was "By the way, another sign of a soft insurance market is the abusive behavior on the part of some brokers who enrich themselves at the expense of both their customers and underwriters." After that opening he really let loose. In fact it's only three more sentences so we will reprint the rest of the paragraph:

"Cloaked in the mantra  of "customer best interest" or  "treating customers fairly," they seek
the cheapest price and broadest  coverage at commission terms that by  any measure are excessive. Forcing  underwriters to succumb to the lowest  common denominator is hardly in the  customer's, or industry's, best interest.  These predatory behaviors, which  have shown up around the world, and  in London in particular, are simply  unsustainable from an underwriting
perspective and will come back to  haunt these brokers: there will be  customer and regulator backlash, or worse. Remember, distribution can be  disintermediated."

Far be it from us to "interpret" words that Evan Greenberg and Chubb carefully analyzed and approved for inclusion into the official discourse. The comment speaks for itself and needs no interpretation.

Reaction was swift. As Insurance Insider noted "A range of heavyweight executives including Sompo International CEO John Charman...Lloyd's new underwriting chief Jon Hancock and Validus CEO Ed Noonan joined the swelling chorus of criticism of the way major brokers have levered up acquisition costs in the London market since 2013."

The acquisition cost ratio at Lloyd's has indeed  increased since 2013.  The acquisition ratio was 27.5% in 2013 and in 2016 increased to 32.4%. The notion that premium rate levels decline, it prompts a corresponding reduction in the amount paid to brokers in commission fees, has apparently been supplanted by new fees from initiatives such as broker market facilities and line-slip commissions fees that have boosted the acquisition ratio at Lloyd's.

John Charman, never one to mince words, said "These excessive and completely inappropriate practices are out of control within the big three brokers and are being strongly supported by underwriting businesses such as XL Catlin."  Charman added ominously that "Irreparable damage is being done to the very substance of our business" adding that this would force insurers to look at alternative distribution channels.  

The comments came against the backdrop of news last week that the  Financial Conduct Authority had swooped down simultaneously on five aviation brokers in London earlier this month, seizing IT equipment from Aon, JLT, Marsh, Willis Towers Watson and UIB. It's not quite certain what the authorities are investigating except that it is aviation insurance and possible misuse of confidential client information

Validus CEO Ed Noonan, who has been a long time critic of broker facilities, commented that clients are "not actively focused on the fact that their business isn't being offered to some of the markets that have paid their claims for years because the insurers don't participate in some broker's facility." Noonan, too, warned that the brokers are inviting disintermediation of distribution and the creation of new underwriting models based on big data and machine learning. He said "The big dollars are in distribution and it is willful blindness to think that this party can go on much longer."

Both Charman and Noonan have been quoted many times in the trade press noting their concerns about the effects of broker facilities and increased broker fees for line-slips.  It is Greenberg though who took the step to "memorialize" his concerns in the hard copy of the most official conveyance of information his company could issue --the Annual Report.

Remember too how Greenberg ended his paragraph about the brokers' behavior.  He said the behavior "will come back to haunt these brokers: there will be customer and regulator backlash, or worse. Remember, distribution can be disintermediated."

We immediately remembered a headline  we had seen in Artemis  about 10 days prior to the release of Greenberg's letter. The headline was "Chubb's reinsurance ceded to ABR Re jumps 144% to $280 m in 2016." ABR Re you may recall is the total-return vehicle Chubb set up with partners including Blackrock in 2015 .  Chubb owns 11% of ABR Re and the reinsurer functions as Chubb's captive or self-reinsurance entity.

ABR enables Chubb "to retain more profit from the business it underwrites, while generating a higher return for that business through the total-return investment strategy and avoid paying fees to cede that risk into the open market through a normal reinsurance renewal."  In fact instead of paying a broker a commission to place the business Chubb is able to charge a ceding commission for itself for placement of the business.

In 2016 Chubb ceded reinsurance to ABR worth $288 million of premium compared to $115 million in 2015 for an increase of 144% year on year.  And in 2015 Chubb recognized ceding commissions of $30 million. In 2016 the ceding commission figure more than doubled to $66 million.

Chubb is able to collect ceding commission on the business it cedes to ABR and, assuming the business is profitable, that profit is added to ABR's total investment return profit and Chubb profits again by virtue of its 11% stake in the reinsurer.

Even the crude math of the $403 million of premium over the last two years that Chubb has removed from the open market (subject to broker commissions) by ceding it to ABR Re would seem to validate Greenberg's warning to the brokers when he wrote "Remember, distribution can be disintermediated."

If Chubb increases the amount of reinsurance it cedes to ABR in 2017 at the same rate it did in 2016 that will mean over $400 million of premium removed from the open market in 2017 alone. Greenberg apparently is backing up his words with tangible actions.

Markets may have the tools and impetus to act

Evan Greenberg's  broadside against the brokers comes at a time when there still appears to be no let-up in rate decreases.  It also comes at a time when the long-held private complaining about the  expensiveness of the Lloyd's market has burst fully into the open. Dwindling premium rates and reduced investment income seem to have a way of causing a focus on operational profitability. As we've seen from the previous story a
32% acquisition ratio is hard to hide.

T he  renewals on April 1  seemed to continue the downward trends on rates. Willis observed
that Japanese property catastrophe rates renewed between  5% and 7.5% lower  on loss free accounts.  US loss free property CAT rates renewed at between flat to 5% lower.  

J apanese cedents apparently were interested in locking down lower rates by evidencing an increased appetite for multi-year cover.  An underwriting source  said that 
"The Japanese look at January 1 and see what happened and think they should get the same."  Of course at 1/1 rate reductions for European business were from 2.5% to 7.5%. US rates at 1/1 were also reported to decrease but at a lower rate of from 2.5% to 5%. The underwriting source said "It's a carbon copy of 1/1."

We keep coming ba ck to that acquisition ratio of 32% when we learn of these continuing rate reductions.  The conventional wisdom is that even with the decreasing rates insurers and reinsurers are generally able to deliver a ROE that is satisfactory (barely). Carriers have been blessed by the  absence of major claim hits , although the frequency of $2-$5 billion type claim losses have begun to attract attention. Reinsurers have taken proactive steps to curtail underwriting in areas and lines which they've identified as clearly unprofitable.Yes we've seen  reduced profit estimates but on the whole though, as James Vickers at Willis has often said, it  appears the "pain level" is not quite there  yet to prompt a rate uplift.

Here's something that might add to the pain level.  The consulting firm  Macquarie Research has concluded   that "ILS funds, as well as the growth of binders, facilities, MGA's and special purpose syndicates, will all conspire to drive increasing amounts of premium from the more commoditized business underwritten at Lloyd's to sources of lower capital."  The study focuses on the cost of capital and concludes that expensive traditional capital is all but certain to be supplanted in a future at Lloyd's where "increasing amounts of standard underwriting business is written at lower margins by ILS and alternative capital, as has already been witnessed with the growth of binder business."
The study notes that currently costs at Lloyd's are high at greater than 40% compared to other markets which see costs of 30%-35%.  Macquarie concludes that looking ahead to 2025, even after cost savings from so-called digitalization are baked in (TOM and other efforts), and expected benefits are realized from greater deployment of ILS capital, traditional Lloyd's underwriters are still expected to have expense ratios of 35% and ILS capacity players will be down to 31%.

Of course predicting results nine years into the future is an inexact science but we were struck that the exercise seemed to focus on cost of capital rather than cost of acquisition.

We thought back to comments made by Ed Noonan of Validus when he was lamenting the "excessive clout being wielded by brokers."  Noonan concluded that the industry is inviting disintermediation of distribution and the creation of new underwriting models based on big data and machine learning

Out in Newark, California certainly Noonan's comments were noted by RMS as well as by modelers elsewhere.  The idea that the increasing sophistication of both models and big data analysis could ultimately lead to complex "rating engines" which could be deployed by alternative capital underwriters has long been a nightmare of traditional reinsurers.  What would prevent those alternative capital providers, or indeed per Noonan, even traditional markets to allow buyers to submit data to a proprietary rating engine that yielded a premium price the pricing results of which could be adjusted on line as risks are excluded or added?  

That day is nearly upon us.  We have seen underwriting prototypes developed by markets that allow that type of hypothetical risk manipulation. We at CATEX are working on similar exposure analysis bolstered by actual claim losses on the risks being evaluated.  Would a certain degree of sophistication be needed by cedents or buyers to understand and be at ease with such a process.  Of course it would but a 32% acquisition can buy a lot of sophistication.  

Realistically, when Chubb cedes business into ABR Re one would presume that the transaction is conducted at arm's length. Chubb owns only 11% of ABR Re and we surmise that shareholders representing the remaining 89% would have questions if Chubb was jamming inadequately priced business into ABR.  That pricing is formulated without any input from a broker.  

Maybe the warnings from Greenberg, Noonan, Charman are more in the line of "don't push us any further or we will start doing what we can do anyway" and let the chips fall where they may.  Remember that in this age of market consolidation there are fewer doors anyway for brokers to knock on when marketing a proposal.

This is all speculation save for one point.  Premiums have been falling for a long time and carrier returns have decreased for years.  Every conference one attends talks about the possible  existential threats to reinsurers of alternative capital and inadequate rates. To use one of our favorite phrases --  if  we know this then certainly the brokers are well aware of it .   Brokers constantly monitor the exposures of markets and their financial health
seeking coverage opportunities for their clients.   Probably, the large brokers at least, are as knowledgeable if not more so, about the business and financial conditions of the carriers than are the financial analysts who follow them.

This leads to an obvious question.  If there is indeed an existential threat facing the industry why would the brokers choose this time to roll out initiatives such as broker placement facilities, line slip charges and the host of other measures that have Greenberg and others so incensed?  We can understand the need for revenue replacement but something, dare we say, as overt as these measures would seem to lend credence to the insurer executives complaints about them.

There is another possibility.  Remember the information brokers have about the markets. It's their business to have this information --the more they have the better they serve their clients.  James Vickers at Willis says that the "pain" hasn't reached the stage yet where a turn on rates is in sight.  Vickers bases his observation on the adequate ROE still being enjoyed by most carriers despite the premium decreases.  

Does this mean that insurers and brokers have different views on the current condition of the market?  It would seem likely.  This difference in views is probably as old as the hills in this market --the underwriter says "we can't underwrite this risk at this rate because of our over exposure" versus the broker answering "yes you can." We think one thing may be different this time.  

When Evan Greenberg issued his broadside in the Chubb Annual Report  it meant he was taking the fight to a new level .  You can't understate the importance of a message included in an Annual Report.  At minimum it means the company expects to stand by it until the next Annual Report is issued.  Nothing makes it into the Report until each word and number is vetted over and over again.  Greenberg's words were as firm a warning as he could issue and, as we see with Chubb's actions with ABR, he is signaling that he's ready to ramp up the fight. 

Two big retirements

We note that Stephen Catlin and Mike O'Halleran have announced their retirements.  Both men are veritable giants in the industry.  Legend has it that Catlin began his career as a self described "tea boy" at Lloyd's when he started training as an underwriter in the 1970s.  After about a decade he founded Catlin Underwriting Agencies and the rest is history.  Most recently, after the acquisition of Catlin Insurance by XL, he was the executive deputy chairman of the combined entity XL Catlin.

O'Halleran, retired from Aon Benfield after 37 years with the company. By our calculation that would put him pretty near "present at the creation" when Pat Ryan merged the Ryan Insurance Company with Combined Insurance in 1982.  That may be why Aon's Greg Case described O'Halleran as leaving " a lasting legacy as a founder, business builder, client adviser and mentor at Aon." 

It's hard to think of any two people who have had such a mark on the reinsurance industry than did Stephen Catlin and Mike O'Halleran. We wish them both well and they will be sorely missed.

Mark Byrne

We also note the death of Mark Byrne who died at the age of 55 in Montreal on April 6. Mark was a co-founder of Flagstone Re in 2005 and in 2014 had been on the brink of acquiring the Lloyd's Sportscover syndicate.  

We knew Mark Byrne. He was originally from New Jersey and we shared stories about growing up on the Jersey Shore. He also volunteered his time and talent spending six months as chairman of the Bermuda Board of Education back in 2009. If you broached the subject of his interest in education and the problems he believed existed at the public education level you needed to be prepared for a passionate discussion. He cared. 

Our condolences are extended to his family and wide circle of friends. He will be missed.

The "coverage gap" is actually close to home

We noticed an article in Artemis with the headline "70% of overall Hurricane Matthew loss uninsured: Aon Benfield."  Stories about the so-called protection gap abound but we took note of this one.  We remember Matthew and in fact had kept our eye on the hurricane maps just to be informed should the storm have started rumbling up the US Atlantic coast.  New
Jersey has its fair share of coastline too and for the record, in our own hometown, Superstorm Sandy knocked out our electricity for 11 (count 'em!) days. 

The article notes that there was a loss to the insurance and reinsurance industry from Hurricane Matthew of about $4.5 billion but an economic loss of almost $15 billion. We quickly, wrongly as it turned out, thought that since the storm had caused significant damage in Haiti which has a far lesser degree of insurance penetration than the US, that the protection gap emanated from Haiti.

Imagine our surprise when we read that in the US there was some $10 billion in economic losses but only $4 billion in insured loss.  The east coast of the United States is one of the most frequently modeled geographic regions in the world and the insurance penetration in the US is higher than anywhere.  

Aon Benfield said that " This meant that about 60% of the overall loss total went uninsured; a higher than normal percentage for tropical cyclone events."  Here's the reason. Most of the damage was done by coastal storm surge and inland river flooding as opposed to wind.  Wind damage is covered in just about any dwelling, homeowners and commercial policy.  Water damage from flooding needs to be purchased separately from the NFIP or the commercial market.  

One would think that after Sandy, and the water damage it caused, that insureds would dust off their coverage to determine whether they would be covered if flooding or storm surge inundated their property.

Yes, we know that flooding and storm surge are coverages provided under US government programs but economic loss is still economic loss whether it was caused by a covered peril or an excluded peril. A 60% uninsured total for the eastern US from losses caused by a named storm is a surprise.

We had seen this story a few weeks earlier -- "Protection gap is not just an emerging issue: Swiss Re."  Swiss Re had noted that even in highly developed US markets the growing flood protection gap posed a serious risk to local economies. Looking at annual data Swiss Re said even though the "majority of US flood coverage comes from the NFIP the flood protection gap of around $10 billion annually shows that even the US remains critically under-insured for flood risk."

We've covered the protection gap in earthquake coverage in the past but the numbers are so dramatic they bear repeating.  Referring to the earthquakes that struck Ecuador and Japan over the same weekend last April Swiss Re observed "Yes, the earthquake in Ecuador did cause economic losses of USD 4 billion and insured losses of just USD 0.5 billion. But the coverage schism is no less dramatic in many advanced markets. The quake in Japan on the same day resulted in economic losses of USD 25 billion to USD 30 billion, while insured losses were USD 4.9 billion."

And, since we've including eyebrow raising bits here, there's always this tried and true fact which we're reported in the past. Swiss Re noted that " Italy is the 8th largest economy in the world, but just 1% of residential buildings are insured against earthquake.

We think there is a method to what new Swiss Re's CEO Christian Mumenthaler is doing when we read "We are transitioning into a risk knowledge company that invests in risk pools with long-term growth potential."  Although much of the article we found in Artemis discusses what may be a Swiss Re strategy to move down the "food chain" to get closer to the risk it's just as clear that another goal could well be to assist in implementing risk pools (to provide cover for flood and earthquake) which Mumenthaler describes as "the original risks, both people and goods, that can be insured." He notes that as a reinsurer "We only access a fraction of the risk through our clients, so building access to risk pools is a key part of our strategy."

Watch this space.  There are few organizations in the world with the expertise, resources, and brand name who could make a bigger impact on this issue than could Swiss Re.   It's hard to believe that it's a coincidence that Mumenthaler could outline this strategy on March 28th and two days later Swiss Re Sigma released a study on the "protection gap" without the events being connected.
A lament (Roger style) about the misuse of tools of his trade

Roger Crombie

Very rarely does punctuation make newspaper headlines, in insurance or in any other endeavor. Even more rarely does a disputed punctuation mark affect overtime pay, especially with World War III looming on the horizon.
Yet such a mark, the "Oxford comma," is the central focus in a lawsuit brought earlier this year by a group of truck drivers in Maine.
The Oxford comma is so-called because the Oxford University Press, almost alone among Britons, requires its use. Americans do, too. Their flag is red, white, and blue. (The comma after 'white' in the previous sentence is the Oxford comma doing its dirty work.)
In correct English usage, the Oxford comma is seldom used. The phrase "red, white, and blue" doesn't need the second comma, the theory goes, because the word 'and' does the job. That is a fact, which, according to Sean Spicer, President Trump's press secretary, you may choose to ignore.
In the Maine case, a state law was intended to describe workers' ineligibility for overtime pay if they are involved in "the canning, processing, preserving, freezing, drying, marketing, storing, packing for shipment or distribution of: (1) Agricultural produce; (2) Meat and fish products; and (3) Perishable foods."
Ignore, if you can, the incorrect mid-sentence capitalization and other errors contained in what is altogether a very badly-written piece of work. Is "packing for shipment or distribution" a single activity exempt from overtime pay, or are "packing for shipment" and "distribution" two distinct activities that are both exempt?
That question dominated a 30-page judgement in the case, which just goes to show that the law is indeed an ass, a truism first stated by George Chapman, in his 1654 play, Revenge for Honor (which he spelled with a 'u'.)
I would like to explain the rules on comma usage, but luckily for you, the Internet is not large enough to allow a definitive statement on the subject. A few helpful asides will have to suffice. My learned editor would doubtless disagree with whatever I am about to write in this regard, since we were differently schooled on punctuation and, on occasion, spelling. (If you see an Oxford comma after 'punctuation', for example, I didn't put it there.).
The importance of correct punctuation cannot be overstated. In 1882, The Topeka Daily Capital reported Oscar Wilde as commenting, in essence, that he had spent a morning deciding to insert a comma, and then spent the afternoon deciding to take it out.
Unlike exclamation marks - one's lifetime usage of which should not under any circumstances exceed 14 (don't ask, just do as you're told) - commas should be used liberally.
In short, a comma goes exactly where you think it would go. I rather like the school of thought that argues that a comma belongs anywhere the reader would take a mental breath, except for its impracticability. Modern corporate writing often avoids the comma altogether, requiring the reader to pause and parse before reading on. The technical name for such writing is 'gibberish.'
The Maine truckers, hardly revered in the field of linguistics, based their case on the fact that they wanted the overtime pay and would subscribe to whatever rules of language helped them to achieve it. A magistrate and a state judge separately dismissed their submission, but a federal appeals court felt the language was ambiguous and returned the case to the lower courts.
If judges have no clue, the matter should be referred to the greatest living expert on commas. I know him; he lives at my house. And that, friends, is the truth, the post-truth, and nothing like the truth.

Roger Crombie is an American Society of Business Publication Editors national award winner. An English chartered accountant who lives in  Eastbourne, on England's South Coast, he writes and broadcasts news and opinion in the US, UK, Bermuda and the Caribbean, in print and online. His main beat is insurance and financial services, with 30-year sidelines in music and humour. All views expressed in Roger's columns are exclusively his own. Contact Roger at

Copyright CATEX Reports
April 25, 2017
Quick Bytes

Malaysian Airlines has become the first carrier to sign up to a new satellite flight tracking system for its fleet.  It comes three years after the disappearance of MH370 with 239 people on board...That entrepreneurial spirit at Lloyd's is alive and well as a headline titled "Amazon Sellers Can Get Insured by Lloyd's for Getting Kicked Off" the giant Internet seller's platform... Warren Buffett has given away $23.95 billion since his 2006 pledge to make annual donations of his Berkshire Hathaway stock.  Over the same time period though the value of his remaining Berkshire shares has increased by $28.3 billion so he's still "up" by $4.35 billion despite having given away nearly $24 billion. Berkshire stock remains quite an investment....Outgoing Lloyd's chairman John Nelson said the market needed to cut the costs of doing business. He said "The challenge for all of us is to reduce the cost of conducting business because within the market this is impacting on already thin underwriting margins"...We're interested in last month's Ogden decision by the UK Lord Chancellor and noted that a six week consultation process with interested parties is in progress. The government said it is considering changing the legal framework for setting the rate, including the investment portfolio risk assumptions the current structure makes. You may recall that assumption to be that lump sum recipients will invest the funds in inflation protected government bonds at negligible interest rates...PERILS AG says that European windstorm exposures, as measured by insured property values remained relatively static in 2016 totaling 54 trillion EUR....Speaking of Chubb the insurer had acquired title to a Norman Rockwell painting "Boy Asleep with Hoe" by having paid a claim to a New Jersey homeowner after the painting was stolen in 1976. The FBI recovered the painting earlier this year and Chubb allowed the original owners to return the claim payment to the insurer and in turn Chubb presented the painting back to them...When Endurance was purchased by Sompo it was expected that the unwritten rule between the Japanese big three would trigger and that Sompo, Tokio Marine and MS&AD would continue to not trade with one another. Endurance has lost a substantial part of its Japanese non-life reinsurance book as a result...Climate change or strong counter-clockwise winds have drawn more than 400 icebergs into North Atlantic shipping lanes over the past month forcing ships to slow to a crawl or take lengthy detours...Brexit aside the EU has approved 52 million GBP to go to the UK to repair damage caused by floods in the country last year...The frequency of major vessel casualties rose in 2016 for the second consecutive year but the loss of total vessels continued its downward trajectory. Marine risks are increasing in size and complexity said the International Union of Marine Insurance. The new Ultra Large Container Carriers (ULCC) can carry 20,000 TEU with a potential cargo value estimated at $985 million --that's for each vessel...Finally, if fish in the Don River in Russia enjoy fruit juice they're in for a treat. A PepsiCo plant in the Lipetsk region of Russia experienced a roof collapse that sent a flash flood of fruit juice through the streets and into the Don. Some several tons of juice escaped and emptied into the river...
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