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  1. #681
    percy
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    Quote Originally Posted by BlackPeter View Post
    Are you saying that it might not be a good idea to invest into insurance companies who underwrite life insurance policies for turkeys without excluding the risk of intentional cultural mass-killings of said turkeys?

    I absolutely agree.

    However - looking at the larger picture of insurance companies do I think that your post just highlights the problem of insufficient diversification combined with underestimating the likelihood and damage of one particular insured event.

    I don't think that the insurance business is that much different to the finance business - and we both are quite heavily invested into some examples of the latter kind. The trick is in both industries to properly manage and cost risk - and to diversify sufficiently to make sure that one (or a series of) super accident(s) does not kill the business.

    I probably need to do still some more research on CBL (and this is stuff for a different thread), but I don't see any reason why insurance in general should be more risky or less profitable than any other well managed business in the financial world.

    Do you?
    Read the history of Lloyds.
    9/11 I only sold one share and it was Tower.
    You are right about finance companies.I think Banks in Australasia have better government controls on them now,but the wild west days of finance companies is exactly what insurances companies are like.
    We still have to watch bad loans with HBL and TNR.Both currently have few.
    I think back to Re-Insure in Aussie,years of great profits,holding mainly cash.Went broke.AMI in NZ,a great history of profits.One earthquake broke them. CBL just remember those who do not follow history are doomed to repeat it.Be careful.If you can understand insurance compay's accounting you are doing well.If you can't,don't buy something you don't understand.

  2. #682
    Speedy Az winner69's Avatar
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    Insurance companies bemoan the increased number of major weather events. Many blame climate change for this (as a result of man's love of fossil fuels)

    Insurance companies make most of their money from the investment of premiums (and hope that premiums and underwriting cover the cost of claims).

    Insurance companies over the years have been one of the largest investors in oil,coal etc companies

    Certain irony that a large chunk of their huge profits over the years have come from things that probably cause the events they bemoan today

    But all, OK it's me and you and other people who can afford insurance who pay for their past follies anyway
    “ At the top of every bubble, everyone is convinced it's not yet a bubble.”

  3. #683
    percy
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    And when in a low interest enviroment, their profits from investments are low they "appear to have a problem".
    And if claims excede underwriting,they " appear to have a very big problem".

  4. #684
    Speedy Az winner69's Avatar
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    percy commented 'If you can understand insurance compay's accounting you are doing well'

    Agree - even doubt if management understand them

    It's an art form, especially once actuaries get involved (sorry Halebop)
    “ At the top of every bubble, everyone is convinced it's not yet a bubble.”

  5. #685
    Speedy Az winner69's Avatar
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    in F16 investment income was about $9m on average investments of $200m ...hmmm

    And insurance company 'Investment Managers' are renowed for flying around the world 1st class and enjoying the good life
    “ At the top of every bubble, everyone is convinced it's not yet a bubble.”

  6. #686
    always learning ... BlackPeter's Avatar
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    Just thought we should move this interesting discussion to a more appropriate thread:
    http://www.sharetrader.co.nz/showthr...l=1#post662332
    ----
    "Prediction is very difficult, especially about the future" (Niels Bohr)

  7. #687
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    when is tower going to accept one of these offers?

    The longer is draws out the less likely and its reflected in the share price when the news first came out $1.32 now down to $1.10.

    Cost me 23c per share which is 23 1c lollies back in the day.

  8. #688
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    Quote Originally Posted by alistar_mid View Post
    when is tower going to accept one of these offers?

    The longer is draws out the less likely and its reflected in the share price when the news first came out $1.32 now down to $1.10.

    Cost me 23c per share which is 23 1c lollies back in the day.
    Its with the commerce commission i think at the moment. Then possibly the OIO after that, so don't hold your breath.

    Gut feeling is the comment about a capital raising if it drags on too long from Tower is to blame for the price drop.

  9. #689
    Legend Balance's Avatar
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    Quote Originally Posted by Baddarcy View Post
    Its with the commerce commission i think at the moment. Then possibly the OIO after that, so don't hold your breath.

    Gut feeling is the comment about a capital raising if it drags on too long from Tower is to blame for the price drop.
    https://www.nzx.com/files/attachments/258718.pdf

    Drawdown of $30m of BNZ facility in May has taken care of capital requirement.

    Next deadline - Suncorp Commerce Commission clearance 30 June.

    Fall back is that Fairfax is still interested and in negotiations.
    Last edited by Balance; 24-05-2017 at 10:45 AM.

  10. #690
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    Quote Originally Posted by Arbroath View Post
    My crystal ball worked - Suncorp enters the fray at $1.30. This could get very interesting as Fairfax have the right to match Suncorp....let the games begin.
    Suncorp firms up at $1.40....as long as Comcom play ball the ball is back in Fairfax's court

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