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Slowing US life premiums; Dorian could become hurricane; China insurer results

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Slowing US life premiums; Dorian could become hurricane; China insurer results

Direct premiums and considerations in the U.S. life and annuity industry expanded at their slowest rate in six quarters as a challenging comparison in the group annuity line partially mitigated continued strength in the ordinary individual annuity business. The industry faces an even steeper trek in the second half, as low interest rates will compound the difficulty in matching the historically high level of individual annuity business volume in the year-earlier period.

The U.S. property and casualty industry saw more rating downgrades during the first half than rating upgrades for the first time in five years, because of ongoing negative effects from the 2017-2018 catastrophes, A.M. Best noted.

The agency also said total income in the U.S. life and annuity industry fell slightly year over year in the first half to $422.4 billion from $424.6 billion.

In China, People's Insurance Co. (Group) of China Ltd.'s net profit attributable to owners for the six months ended June 30 increased 54.1% to 15.48 billion yuan from 10.05 billion yuan in the prior-year period. China Pacific Insurance (Group) Co. Ltd. posted a 96.1% year-over-year jump in net profit for the first half, with net profit attributable to equity holders of the parent totalling 16.18 billion yuan, up from 8.25 billion yuan in the year-ago period.

Austria-based Vienna Insurance Group AG reported a 10.5% increase in its first-half net result after noncontrolling interests to €151.0 million from €136.6 million a year ago.

South Korean nonlife insurers are better positioned to face the impact of the IFRS 17 accounting standard and K-Insurance Capital Standard solvency regime as compared to the country's life insurers, according to an A.M. Best report. The two frameworks will be simultaneously implemented by 2022.

Tropical Storm Dorian could bring hurricane conditions in Puerto Rico, and a tropical storm warning and hurricane watch have been issued in the region. Hurricane and tropical storm watches have also been issued for some parts of the Dominican Republic. Residents in the Bahamas and Florida also need to monitor the progress of Dorian and ensure that a hurricane plan is in place, according to the National Hurricane Center.

Canada-based Intact Financial Corp. closed its bought-deal offering of approximately 3.83 million subscription receipts, bringing in gross proceeds to the company of approximately C$461 million.

The IRS issued a favorable private letter ruling to Allianz Group unit Allianz Life Insurance Co. of North America regarding the tax treatment of advisory fees taken from nonqualified, fee-based annuities. Under the ruling, payment of advisory fees from fixed-indexed or variable nonqualified annuities can be made without creating a taxable distribution event.

Rep. Sean Duffy, R-Wis., a champion of National Flood Insurance Program reform, will resign from Congress, citing complications related to his wife's pregnancy. Duffy has led Republican efforts to reform the embattled program that provides more than 5 million flood insurance policies to property owners, renters and businesses.

Thomas Fargo was appointed board chairman of United Services Automobile Association. Fargo, who was the board chairman of U.S.-based Huntington Ingalls Industries, Inc., replaces Lester Lyles, who will leave the company's board.

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Insurance broker deal volume drops sequentially, YOY in Q2: The 155 insurance brokerage deals in the second quarter was the lowest figure the industry has seen since the first quarter of 2018.

In other parts of the world

Asia-Pacific: Japan megabanks MOUs; Orix bank sale talks; India central bank surplus transfer

Europe: LendInvest delays IPO; Deutsche's India expansion; Bank of Cyprus sees H1 profit

Middle East & Africa: Nigeria sets bad-loan limit for banks; South Africa's JSE in 224.5M rand deal

The day ahead

Early morning futures indicators pointed to a higher opening for the U.S. market.

In Asia, the Hang Seng fell 0.06% to 25,664.07, and the Nikkei 225 rose 0.96% to 20,456.08.

In Europe, around midday, the FTSE 100 was down 0.19% to 7,081.68, and the Euronext 100 was up 0.20% to 1,039.93.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

On the macro front

The Redbook Index for retail sales, the S&P Corelogic Case-Shiller home price index, the Federal Housing Finance Agency house price index, the consumer confidence index and the Richmond Fed Manufacturing Index are due out today.

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