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Providing A Choice

TARS (Travel & Aviation Risk Solution) offers a DIP (Default Insurance Program), an insurance alternative to costly BG/LCs, tailored to each territory, with lower costs and no collateral. Find out what a DIP is and why it's important for agents.

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Providing A Choice

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  1. WTAAA –Geneva 04Sep16 Providing A Choice

  2. Who Are We? • TARS • Since 1997 – Thailand • Helped Create DIP • HKG base – Global Reach • Malaysia (2) & Philippines • Ecuador (2) • Australia (3) • Consumer & Consolidator Prog. • IATA Impact • R850p • TAC – Appeal option for IATA • TAC hearings in favor of insurance • Independent Insurance, Agency, Airline Expertise • Ray Hartweg • Agency Experience since 1982 • Flying Tigers - Regulatory & Industry Affairs Director, • IATA Director - Agency, Area 3 (A-P) • Travel Agency Commissioner – Southeast Asia • DIPs since 1997 • Former GSA – NZ • Europe/USA/SE Asia footing • Consulting Skills – Distribution, IATA & Industry Matters, GSA, Cargo & Marketing.

  3. What is a DIP (#1)? From Resolution 850p – Financial Securities Language and implementation – often two very different things! hartwegr@tars.aero

  4. What is a DIP (#2)? • Providing Agents with a Choice Insurance alternative to costly BG/LCs No change to Agency Program – tailored to each Territory 20-25% lower cost! No Collateral - Ever Business Risk Limited – No personal indemnity; and No director’s guarantee Covers Agency Program, not individual Agents – Simple administration Registration Form, not Application No Minimum Number of Agents – Commercial Choice Multi-year initial Policy - commitment

  5. What a DIP is Not Not Mandatory – Choice with Agent Not Tied to IATA – independent Not “one-size-fits-all” – we have and can do a DIP anywhere – territory tailored Primarily Asia – but have worked worldwide (over 15 territories) Complicated or Costly 1 additional Form – registration Compare out-of-pocket-BG cost – usually lower Total savings to Agent – zero collateral (even if Time Deposit!); Separate business from personal and lower cost! Timing – takes a few months to get program set-up – then go to IATA Can do a WTAAA DIP in short order by territory, by region or global!

  6. Who is a DIP? • Who We Are? Fronting Insurer – local content, local expertise, local language & more RE-insurer – supports whole DIP – 1 country or multi-country Insurance Broker – LON Based – Ropner (Lloyds – 100 years) TARS Key Market Components: Agent Associations – work closely Some airlines – “white knights” Many Individual Agents

  7. IATA & DIPs GIS is likely to face major obstacles – Why Unrealistic expectation of Insurers & Cover vs. Risk Biggest obstacle to DIP expansion today? 32-pages of Procedures No info on defaulters Common End Dates Changing Claims basis mid-stream Banks unregulated – 98% of risk! Why? Monopolies do not provide best service and certainly not best price Bigger is better mind-set not valid Fantasy rates (20% vs. 40% recent PH reduction) What role will IATA play – RFT – not seen; Billing & Collection role – unfair to future providers All eggs in one basket – what happens if AIG déjà vu? Local regulations, AML rules, FCA Conflict of Interest requirements, Customer Service, etc. Why now – DIPs - 20 years with little IATA support?

  8. NewGen ISS Features vs. Benefit? Business Case – shown? Declining numbers – historical TMCs vs. Standard vs. “Lite” vs. LCCs vs. OTA vs. Google vs. what’s next? Push for shorter credit, higher financial guarantees – what is in it for Agents? If LFC effective and Agent passes – why ask for financial guarantee? Airlines undermining Agency Program with demands for separate guarantees (growing trend) Top heavy administrative burden (Delinq-irreg-credit events, audited account, “Top-ups” and what more?)

  9. Resolution 8XX (May16 edition) Current Program Proposed Program Different view Administratively heavy handed Costly – audited accounts, top-ups, Agency Fees, etc. What are benefits today: Access Credit Single Billing/Payment Name on door? Declining membership Agency Program less important to airlines Agency Program less important to Agents too Risk Event, RHC, multi-credit levels, risk management – more admin. Still Costly What are benefits tomorrow: Access – separate BGs Credit – reduced more & more BSP – burden or benefit? Consumers don’t care Market place changing daily Where are features & benefits Does this fix the problems ? Airlines-IATA-Agents – Two commercial groups vs. one bureaucracy! Bank Guarantees (credit) remains single biggest topic – same as in 1980s! Separate guarantees growing concern for many agents If I have 1M in sales and matching BG, most airlines will do business with me! Those who do not deal directly will send me to their favorite agent or consolidator. Commercial process is simple: Sales=BG=relationship Why make rules so complex? StB but not for Agency Program!

  10. DEFAULT INSURANCE PROGRAM – TARS MARKETING & ADMINISTRATION T - U - V - M WTAAA BOARD MEETING & AGM 04-05 September 2016 – Geneva Travel & Aviation Risk Solution – TARS info@tars.aeroor hartwegr@tars.aero Web Site: http://www.tars.aero

  11. WHY JOIN UCPB GEN INSURANCE‘S DEFAULT INSURANCE PROGRAM (DIP)? JOIN THE BSP-PHILIPPINES DIP NOW! • ANYBSP-PH AGENT CAN JOIN THE DIP! • THE DIP IS: • IATA APPROVED • Agent Association SUPPORTED • BOTTOM LINE -SAVINGS • CONTACT UCPB GEN NOW! • GET “NO-OBLIGATION” QUOTES! • ASK A FELLOW AGENT ABOUT UCPB GEN TODAY! • EMAIL ALL INQUIRIES TO: • dip@ucpbgen.com dip@ucpbgen.com

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