Lancashire Share Discussion Threads

[jrphoenixw2] 06/9/2017 15:20

What exposure have LRE to Miami/Florida? I'd have thought it's avoiding running through the Gulf of Mexico and it's oil fields that we might feel more positive about.

[woodhawk] 06/9/2017 12:28

Thanks for your concern, Effortless, but I've always found I make the most on my investments going against the grain. I'm not hugely exposed here anyway.

[woodhawk] 06/9/2017 12:04

Decided to join you today - attracted by the rather large divi. Bought my second tranch just now at 651p. Looks well oversold.

[effortless cool] 01/9/2017 21:35

I meant insurance market, not stock market.

[jrphoenixw2] 01/9/2017 18:01

No it's not, if it were we'd know by now. And the market - last week of August - is as dead as a door-nail. Hence bargain hunting time...

[effortless cool] 01/9/2017 14:41

KCC first out with an estimate of the insured loss from Hurricane Harvey: $15bn.

By no means a whopper, then, with much of the flood damage uninsured, and certainly not going to turn the market.

[jrphoenixw2] 01/9/2017 11:35

That year end div is going to be so freakin juicy,
and the market is so losey,
I just had to chuck in another 1/4mil'anoosy

:)

[jrphoenixw2] 01/9/2017 10:47

Ooh, did I do that intra-day spike [innocent face] :-D

[jrphoenixw2] 01/9/2017 10:28

- That should perk it up a bit. What. What? It's a kin bargain on this yield :)

[pogue] 31/8/2017 07:16

The statement does not say for certain they are in the clear only they think they are in the clear and need to check a couple of things. I have heard too many reassuring statements from companies in the past saying they think they are fine only to have reality prove otherwise. No reason to believe LRE are in deep trouble but that statement tells me nothing concrete.

[effortless cool] 30/8/2017 16:42

Dunce's cap for Barrie Cornes ...

Barrie Cornes, an analyst at Panmure Gordon & Co., wrote in a note to clients on Monday. He estimated costs of 200 million pounds ($259 million) for Lancashire Holdings Ltd. and 100 million pounds each for Hiscox Ltd. and Beazley Plc.

[effortless cool] 29/8/2017 21:30

gsbmba99,

Let's say Harvey is a $35bn loss. That makes it about the same size as Ike (inflation-adjusted) in 2008. Ike was not a market-turning event, although I recall regional property insurance/reinsurance rates did strengthen for about a year. To really turn the market around, I think you would need a $100bn+ (perhaps quite a lot +) event.

I'm afraid I have no idea of the impact on LRE. As I mentioned previously, I don't expect market losses to be as evenly spread as would normally be the case for an event of this scale.

[this_is_me] 29/8/2017 19:03

It is bound to put insurance rates up and that normally means much bigger profits in the medium term.

[gsbmba99] 29/8/2017 17:28

Not sure where Equity Development got their number came from.
Not an insurance person, but if the LRE corporate ethos is legit I would be very surprised to hear that they had large flood exposure to Houston. That seems only marginally smarter than offering flood insurance in New Orleans.
EC, Do you have a view as to what would cause a reversal in the decline in rates? Do you see the LRE special dividend for this year as "at risk" as a result of Harvey?

[effortless cool] 29/8/2017 14:35

Flood losses from Harvey are going to be significantly greater than wind losses. They are also going to be a lot more complicated to quantify and settle, due to coverage issues, sublimits and business interruption exposures

Overall, Harvey is certainly not a market changing event, and I would expect the flood aspect to leave losses a lot more concentrated with certain insurers/reinsurers than would be the case for a normal hurricane event.

[gsbmba99] 29/8/2017 13:46

FWIW, I saw the following commentary from Equity Development: "Harvey is the first hurricane to hit the US mainland for a nearly five years and has already caused several $billions in damage. The destruction will result in a short-term hit to companies insuring or reinsuring properties in Texas but the weakening of the winds and their destructive power (indicated by its official downgrading to a “Tropical Storm”) means that it is unlikely to trigger a change in the downward trend in reinsurance and insurance rates." If true, would be a bad outcome for those covering the insured losses (ie losses with no pickup in rates going forward).

[jrphoenixw2] 18/8/2017 09:44

The exchange rate on the div has been published, (a bit after the event as has been typical of late):

'On 26 July 2017 an interim dividend of $0.05 (£0.0386) per common share was declared. The dividends will be paid in Pounds Sterling on 06 September 2017 to shareholders of record on 11 August 2017.'


[ie FX rate 1.2953]