TWR - Tower Insurance.

[whirly]

I would think that the least profitable companies up to this point will tend to be risk adverse reinsuring to the point where they tend to be over reinsured for events like this. The problem that I see is if one company goes under creating a domino crisis with other more conservative companies. There is a lot of money to come out of this sectors profits, it would be a brave investor who would dip in trying to bottom pick.
Macdunk

While Im usually a fairly conservative investor. Im comfortable with my 1.77 entry this morning. My first buy for weeks!

[CJ]

While Im usually a fairly conservative investor. Im comfortable with my 1.77 entry this morning. My first buy for weeks!

Good buying - why did you buy? As a long term hold and just taking advantage of a short term dip as an entry or as a specific short term gamble that the market had over reacted.

[duncan macgregor]

While Im usually a fairly conservative investor. Im comfortable with my 1.77 entry this morning. My first buy for weeks!

You got off to a good start WHIRLY with that one ,what about casting your eye over LPC which is fully operational but damage costing millions which is more than likely covered. Might be a good buy coming up when they start trading after the expected fall. Macdunk

[whirly]

CJ, I bought as a long-term divvy payer. I am shopping quietly now as my TA signals fire. My homework on the weekend revealed TWR as a buy (discounting the fact that a bloody great earthquake had hit CHCH), and after deciding on a discounted $1.83 entry was happy to see it lower this am. I guess I got lucky that it has held at that I make more than my share of bad entries!.

Cheers Macdunk. Great to see you back too by the way! I'm am normally not what one might call a bottom feeder. Usually when I buy its a historically proven signal that it's time to sell.

I haven't looked at LPC yet. I will, I have a few on my watchlist with a couple of orders placed but not filled.

[777]

Surely that works in reverse as well. ie they have liabilitiy to other insurance companies when they have big claims.

[RRR]

I was expecting a carnage and that didn't happen-thank goodness for that. Who are these re-insurers? How does it work?

Disc-TWR is significant in my portfolio

[macduffy]

Surely that works in reverse as well. ie they have liabilitiy to other insurance companies when they have big claims.

I don't think so.

Companies such as TWR lay-off part of their risk with reinsurers, generally large international companies who don't operate in "retail" markets. I'd be surprised if TWR was in that market.

[peat]

re-insurance helps to counter the non random and clustering nature of insurance risk such as occurs from things like this quake and of course weather and flooding.
quakes really are a big clusterhit from an insurance perspective. every actuary's nightmare.
I doubt Tower would accept re-insurance but if they did it would achieve similar goals as using it, in that it would diversify risk.

[Jaa]

I don't think so.

Companies such as TWR lay-off part of their risk with reinsurers, generally large international companies who don't operate in "retail" markets. I'd be surprised if TWR was in that market.

TWR is no where near the re-insurance market and neither should it be! Their business is insurance origination both general, health and life and savings and investment.

You need to be very large to survive the ups and down in the re-insurance market. Some of the major providers are Berkshire Re and Swiss Re both owned by Warren Buffet's Berkshire Hathaway. One closer to home that also plays in this market is QBE of Australian.

Its generally a good industry to be in long term so long has you have the financial wherewithal to withstand the odd catastrophe. Even then, re-insurers will often spread their risk amongst themselves. The risk ends up being effectively spread far and wide internationally of which the likes of IAG and TWR are only the first line.

[ratkin]

Remember the reinsurers Lloyds of london

The "Names"--as the investors are known--didn't really invest anything at all. They merely pledged their assets, while the assets themselves--stocks, bonds, or land--continued to make money, for many years the "names" recieved money in dividends merely for pledging their money.
However it all went belly up after a series of natural disasters and asbestos claims meant Lloyds could not meet the claims and had to ask the "names" for money. Many had no idea of the risks they had been taking and lost their ancestral fortunes