The 10 Commandments of Insurance Investing

[Guest HarryLong]

The 10 Commandments of Insurance Investing  ;D

 

I. Thou shalt protect thy ass, capital being an extension of it. Keep this above all other Commandments.

 

II. Thou shalt not sacrifice Quality for Price.

 

III. Thou shalt Live by the Dice and Die by the Dice. Make sure thy Dice be Loadeth in thy favor if thou wish for thy days to be long with capital on this Earth.

 

IV. Thou shalt not believe in the craven image that paying a discount to book value will save thou from loss of capital.

 

V. Thou shalt pay special attention to the combined ratio during a period of weak pricing in the industry. Such periods reveal the True Character of the Underwriters and in the strength of the Loadeth Dice.

 

VI. Thou shalt respect thy Reserving Tables.

 

VII. Thou shalt buy the insurer for its underwriting prowess if thou art an investor. If thou taketh the insurer over, firing its incompetent portfolio managers is but a small feat, but bad underwriting may take a decade to dig thy self out of if the tail of the insurance be long.

 

VIII. Thou shalt pay special attention to the Premium to Surplus ratio. If it be high, and the underwriting be solid, thou art probably safe, but if it be high and the combined ratio be over 100, Woe unto you! Short are thy days with thy capital on this Earth!

 

IX. Thou shalt attempt to find insurers which can underwrite with a combined ratio below 90. Such a situation is Heaven on Earth for they who live by Loading the Dice.

 

X. Thou shalt not believe the foolish soothsayers who say that it is impossible to find a fine underwriter that is selling cheaply. Have faith in thy research and the eternal patience to keep honor with the nobility and sanctity of thy quest.

 

[woodstove]

Thank ye!

[Guest HarryLong]

I've tried to tighten up the grammar with the "Thee" Thou" "Thine" "Thy" etc .

 

I think this latest version is much more grammatically correct.

[rranjan]

I've tried to tighten up the grammar with the "Thee" Thou" "Thine" "Thy" etc .

 

I think this latest version is much more grammatically correct.

 

I think the content is more important than grammar and that seems good to me ;)