Good book to learn the Insurance business

[kapilm]

I am looking to learn about the insurance business in detail. What books would be best ?  I already have WEB's annual letters.

 

Thanks in advance....

 

[Grenville]

Nice blog post: "Analyzing Insurance Stocks: The Income Statement"

 

http://streetcapitalist.com/2010/03/31/analyzing-insurance-stocks-the-income-statement/

 

[Myth465]

I have learned quite a bit by holding and watching FFH, BRK, CNA, and Lancashire. The annual reports are also really good intros to the market. I posted Lancashire's yesterday on the board.

 

Basically thier are 3 ways to make money insurance.

 

Writing at a loss / break even and making money on float - FFH thus far. The Hedge Fund Model.

Writing at  a profit and managing a very conservative investment portfolio - LRE - Lancashire. The Insurance Company Model.

Both, writing for profit and managing float. - BRK and HALL - The blended model.

 

The key to insurance in my opinion is Management. I am an Accountant and earnings are typically whatever you want to be. In insurance they literally are whatever you want them to be. Its based on assumptions and models and there is plenty of room for Management to fudge / massage the numbers. I glance at the underwriting results and look for prior year development because that gives you an idea on how conservative they are. I dont really look for growth because you can very easily grow an insurance business unprofitable at any time.

 

[motownsf]

A wise man recommends "The Invisible Bankers".

[ExpectedValue]

Nice blog post: "Analyzing Insurance Stocks: The Income Statement"

 

http://streetcapitalist.com/2010/03/31/analyzing-insurance-stocks-the-income-statement/

 

 

If anyone has any suggestions for this, feel free to shoot them my way. Hoping to put up the second post, the balance sheet, next week.

[Myth465]

Looks really good, actually goes into the right amount of detail. Tells you just enough but doesnt go crazy on the accounting side.

[onyx1]

Here is a basic primer on P/C Accounting & Taxation (free download):

http://www.iii.org/assets/docs/pdf/AccountingBook.pdf

 

Here is a good starter on the Reinsurance business:

http://www.amazon.com/Reinsurance-Fundamentals-Challenges-Ruth-Gastel/dp/0932387500

 

I found both helpful in deciphering the maze of insurance jargon.

[mpauls]

I'd just say read the annual letters of the really good insurers, you'll get plenty of worth while hints there.  Then just think about it on your own.

 

onyx1 mentioned a good resource in http://www.iii.org

 

 

[kapilm]

Thank you all. I'll check out the books/links.

 

 

 

 

[tombgrt]

Nice blog post: "Analyzing Insurance Stocks: The Income Statement"

 

http://streetcapitalist.com/2010/03/31/analyzing-insurance-stocks-the-income-statement/

 

 

If anyone has any suggestions for this, feel free to shoot them my way. Hoping to put up the second post, the balance sheet, next week.

 

Hi Tariq. Sorry for the bump but I just wondered if the balance sheet part is on your blog? I couldn't find it yet. ;(

 

I learned a lot from the post on the income statement, many thanks for that. :)