Aviva Share Discussion Threads

[leedslad001] 05/4/2020 22:21

Not good hope he gets well soon. Has the potential to be one of our best leaders

[essentialinvestor] 05/4/2020 22:01

Johnson admitted to hospital.

[cjac39] 05/4/2020 20:50

I’m not making an emotional or moral statement. I was trying to be unemotional and heuristic. I know lots of non vulnerable front people have suffered but I stick with my guesses as best I can do to inform about what’s going on.

[sikhthetech] 05/4/2020 20:45

cjac39
"weve had 4500 deaths mostly from the 2% most vulnerable who suffer a c10% death rate"

What about the front line drs & nurses who were not vulnerable but have died?

What about the staff working for London Buses who were simply doing their job?

The death rates are not significantly higher simply because of the lockdown. The danger is if the people, who have been infected but currently in isolation, go out then they could infect to bus drivers, shop workers, school teachers etc etc..

With so many people in hospital, who should the drs try and save??

[cjac39] 05/4/2020 18:17

my personal guess, not remotely as an expert, is weve had 4500 deaths mostly from the 2% most vulnerable who suffer a c10% death rate and thats from 20-25days ago as it takes something like 20-25days from onset to death. therefore its directionally something like 4500 / 0.1 / 0.02 = 2.25 mln rolled forward from around 10th march pre lockdown rolled forward at a fair tick until lockdown 23/3 including schools, horse racing, tubes , concerts, pubs etc etc so could easily be 5-10 mln have had it (and i could do lots of fancy bayesian curve fitting, gamma distn stuff and end up with a wider range) therefore if i was running the show and had success with the lockdown first time around i would let people out relaxed sweden style but try to force the 1-2mln vulnerable people to stay isolated

[wba1] 05/4/2020 17:45

If 50% of the population had had the virus it would be very difficult to explain why only 47k out of 195k tests conducted (as of today) have proved positive, despite testing being restricted to those most likely to be positive (showing symptoms).

[panshanger1] 05/4/2020 17:27

My brother lives up there EI - they were evacuating patients last night from Cassiobury Park in Watford ( close to where he lives and the hospital ) to Addenbrookes Really scary stuff

[essentialinvestor] 05/4/2020 16:58

Steve, take your point, however we've already had a situation where a Watford and London hospital have turned away patients from A&E.

Can you imagine the scene with people literally dying outside hospitals if
they had not tried to flatten the curve. There are no easy choices here
and I'm not sure if authorities even have an exit strategy, at least a clear one.

[steved] 05/4/2020 16:31

There is no sensible way forward other than the Swedish strategy. The longer we delay in getting the economy back up and running the worse the outcome in my opinion. There are many epidemiologists whom have argued against shutting the economy down for all sorts of reasons. A study by Oxford University a couple of weeks back suggested around 50% of the population had already had the virus.

Until we have a vaccine the only way to overcome the virus is herd immunity and this is the best way to protect the vulnerable as surely locking them up for a year or two or longer isn't a sensible option.

The government should be planning an exit strategy and getting on with it sooner rather than later, indeed the sooner the better. Otherwise we are going to be in a right old pickle.

[wba1] 05/4/2020 14:52

cjac39; I think you are broadly correct, but remember that in the US insurance is largely regulated at state level. What may be acceptable in Massachusetts (or the Socialist Republic of Massachusetts as it used to be called in The Hartford boardroom) is entirely different to what is acceptable in Texas. And forcing the hand of insurers does not require legislation in many states - just a go slow on matters such as approval of new rates.
I hope you are right about our government but I am not entirely comfortable now that the excellent Carney has departed to be replaced by a hand picked government acolyte. And the sort of behaviour we need to avoid is not restricted to any one party. Remember when Brown strongarmed Lloyds into taking over HBOS and withholding from shareholders (when they voted on the takeover) the key information that HBOS had £25 billion of emergency liquidity assistance?

[cjac39] 05/4/2020 14:20

There has been a bit of noise about forcing p&c insurers in us on pandemic claims but it got thrown out pretty quickly. It would be difficult to imagine rewriting the law or making up new things they have to cover that’s not in an insurance policy and in any case knackering the ins sector is dafter and less economically sensible than paying people’s wages for few months. The banks need forcing to hold more capital as their losses from this will be substantial and spread out over many years and they have form paying bonuses and divis when they shouldn’t

[essentialinvestor] 05/4/2020 14:07

UK banks have been treated absolutely disgracefully -and I'm saying this as
someone who does not hold any ordinary shares in UK banks.

Will HMG now also stuff UK insurers? - that would be my main concern, just imv only.

[123trev] 05/4/2020 13:33

It’s absolutely refreshing to read intelligent posts can’t fault you guys keep it up.

[cjac39] 05/4/2020 11:52

definitely dont read it! we will of course hear about lots of horror shows and retailers etc and undoubtedly this is a severe recessionary event but my 2p view having investigated the stats around this is that many many more people have had it than you think and therefore the likely case severity might be lower as well. the imperial study made many assumptions in particular on so called IFR being close to 1%. however its way too early to know what this will be and some people think its overestimated 5-10x in which case Sweden might be doing the right thing. however you wouldn't want to overwhelm the health system as that would most likely lift the death rate to unacceptable levels. so a bit of lockdown and then unwind restrictions for non vulnerable people seems sensible. either way the life insurers and composites are not that exposed as they don't have that much sme exposure. they will take hits from property exposure but its reasonably isolated and contained and i think they will possibly profit from underwriting exposure this year.

[wba1] 05/4/2020 11:45

Not all the Sunday papers are negative on all companies. The Scottish Mail on Sunday (and I presume the English version as well) has a very nice positive piece on Sabre.

[whatsup32] 05/4/2020 11:37

I expect many companies will start announcing they will go into administration by the end of this month. Regardless of the fact that wages are supposed to get 80% paid by government.
Of course that will have ripple effect . If as suspected Virgin Atlantic goes under , then companies doing business with Virgin will likely be unpaid and also risk going under.

Sweden may have the right solution for this pandemic. Lock up the vulnerable like myself and continue business as usual.

Don’t read Sunday papers if you don’t want negative news

[wba1] 05/4/2020 11:15

whatsup32;
generally I agree, but I am not sure about the wider impact on reinsurers like Swiss Re, and do not know if events like the Olympics have any bearing. Whilst I do not know about Swiss Re's specific position, I know that Munich Re have a specialist pandemic underwriting unit they set up a while ago, but that it remains small. With regard to the Olympics, the Japanese have always been very keen to retain risk locally, both primary risk and first reinsurance layers. I doubt that would have changed for the Olympics, although the size of the exposure would have involved some international risk placement (although whether this included pandemic who knows). For me, the biggest risk to reinsurers is if they are on risk for a significant pandemic exposure and the contracts contain auto reinstatement terms and/or are multiyear. In that event a second and third wave could be very bad news - but would be restricted to a very small number of exposed companies. I have little doubt that a single wave event would have limited impact.

[whatsup32] 05/4/2020 10:06

Good article in the Sunday Times. Business sec. page 7 ‘why the insurers aren’t paying out to customers but they are to investors’


RSA states ‘only 5% of businesses may be covered for the Coronavirus. Nearly all companies are not covered for pandemics’

Insurers face minimal extra costs .
Last year £244m was paid for business interruption of which £194m was fire damage
One analyst said that if 5% of the 8,000large businesses in the U.K. had eligible interruption cover of up to £1m it would cost insurers an extra £400m.
Travel insurance claims for virus related comes at least £274m , double the sum paid out in 2018.
Swiss Re are in for big ticket claims. Tokyo olympics?
Motor insurers will see a drop in claims ,
‘If anything reserves will be improved rather then depleted. Not paying dividend will be totally inappropriate’

All reads good , I’d still rather hear from Aviva.

[actybod] 04/4/2020 20:45

Even better - thanks for putting me right!

[tornado12] 04/4/2020 17:46

Convinced they will pay and I’m heavy in both these and Lgen. Not best is capital share price growth but they need to be divi top tier payers like RDS

[gary1966] 04/4/2020 17:37

Actybod
4 Apr '20 - 10:59 - 1803 of 1812

From the announcement on 17/3

Aviva remains well capitalised, near the top of its working range. Based on the closing market position on 13 March 2020, our Solvency cover ratio is estimated at approximately 175%, after allowing for payment of our proposed final dividend (c.7 percentage points). The estimate does not allow for any increase in insurance claims or changes in experience or assumptions that may arise from Covid-19. We have expanded our hedging and ALM activity on equities, interest rates and credit spreads. As disclosed at our recent full year results, our centre cash position at the end of February was GBP2.4 billion.

So 175% is after the final dividend has been adjusted for. Markets very slightly up since 13th March as well.