Daily Market Update - March 4, 2015

Obamacare hits the Supreme Court, insurers warn of “death spiral”… FREAK bug creates cyber threat… World’s largest employee-owned insurance firm created… Flights at risk from cyber attack warns government report…

Insurance News

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Obamacare hits the Supreme Court, insurers warn of “death spiral”
President Obama’s Affordable Care Act is due to be challenged in the Supreme Court today and could mean the loss of subsidies for more than six million Americans who bought their insurance through the federal exchange rather than a state one. NBC News reports that challengers to Obamacare are focusing on that one part of the Act whereas The White House is urging the court to consider the document as a whole. Insurers warn that if the challenge is successful and millions are removed from the scheme it will create a “death spiral” by increasing premiums for those who enroled through state-run exchanges and would eventually kill off the program altogether. The Supreme Court’s term ends in late June and a decision on this matter is expected by then. Read the full story.
 
FREAK bug creates cyber threat
A flaw in some internet browsers, which is a legacy of an old US law that meant cybersecurity had to be weak enough to allow the feds to see what we were doing online, has created a new cyber threat. The FREAK bug could gain access to internet browsers, especially those used on mobile devices, and steal login information or personal data. Apple’s Safari and some Android browsers are vulnerable, although Google Chrome, Mozilla Firefox and Internet Explorer are not believed to be affected.
 
World’s largest employee-owned insurance firm created
The names Hyperion and RK Harrison may not be huge global brands but the two firms have just announced a merger that will create the world’s largest employee-owned insurance firm. The combined business will be 70 per cent owned by 600 of its 3000-strong staff. The London firm will make around 30 per cent of its revenue in the US and will operate in 37 countries with 121 offices. There is currently discussion to determine which of the two legacy names to adopt for the new company’s global identity. Hyperion boss David Howden says they will also consider whether the firm should become publicly-listed while continuing to have a largely employee-owned structure. Howden told the UK’s Daily Telegraph that he expects more independents to merge, including US firms, and he says that brokerages will merge partly because “they don’t think about capital. They run out of capital, they run out of ways of moving shareholders on, so their only exit is a full exit.” Read the full story.
 
Flights at risk from cyber attack warns government report
A report from the US Government Accountability Office is warning that the air traffic control system is at risk from cyber attackers because vulnerabilities have not been fully addressed. In a 42-page document it calls for the Federal Aviation Administration to address issues with its cybersecurity warning that: “These shortcomings put (national airspace) systems at increased and unnecessary risk of unauthorized access, use, or modification that could disrupt air traffic control operations." CNN reports that the FAA has agreed with the recommendations and is working on strengthening its cyber defenses. Read the full story.
 

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