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Ashleigh Rogers

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  • Allied World Assurance: An Insurance Company That Is Allied With Investors [View article]
    Well the firm of course does not release details about their investment strategy publicly as that would help their competitors. That said, I think the key thing to remember about AWH is that this is a firm that acts very opportunistically. From what I can tell the firm tends to jump into a lot of distressed and unloved assets, taking a long view on them. Don't get me wrong, they have seen some hard times as the fall in book value from 2007 to 2008 illustrates, but by and large their investment choices have been good ones.

    As far as natural disasters goes, the nice thing about AWH versus many competitors is that they do a really good job of diversifying their insurance book not only geographically, but also across different lines of business. This is critical because it gives them less exposure to even major disasters (e.g. Super Storm Sandy) that effect an entire line of the insurance industry.
    Sep 16 04:29 PM | Likes Like |Link to Comment
  • Allied World Assurance: An Insurance Company That Is Allied With Investors [View article]
    Thanks for your comment. I personally like AWH the most. I think it has the most competant management (as demonstrated by their consistently low combined ratio), and their investment portfolio is very procyclical. As a result they seem to do a little bit better when the economy is getting stronger. The other nice thing abou AWH is that they aren't just reinsurance. That's important in this market, because competition the reinsurance segment is starting to heat up and in a few years profits will probably be squeezed. AWH will be hurt by that eventually, but they won't be hurt as much as other reinsurers will. This is just my opinion of course, and in general I'm bullish on the overall insurance industry as I think we have multiple good years ahead of us (baring unforseen natural disasters of course).
    Sep 14 03:07 PM | 1 Like Like |Link to Comment
  • Allied World Assurance: An Insurance Company That Is Allied With Investors [View article]
    1.) Interest rates can't go much lower. That said, if they do then AWH's existing portfolio will benefit. The firm has increased book value dramatically in a variety of interest rate climates
    2.) I have very little in the way of concerns. The housing market is recovering rapidly and these securities have been performing very well. If you assume the housing recovery is about to collapse then you have to assume the entire economy is going back into recession in which case very few investments are safe.
    3.) AWH's investment performance in closely tied to book value which I discuss extensively above.
    4.) Aeolus has been an extremely efficient reinsurer with great returns even in a period of increasing competition. Reinsurance doesn't involve writing policies directly so I'm not sure what your question is referring to. That said Aeolus' models and performance speak for themselves and given AWH's sizeable investment in the firm and the fact that Aelous is closely held, I'm confident that AWH is closely involved in major firm specific decisions. Dropping Aeolus to open their own reinsurance division would be a terrible and costly idea for AWH which would necessitate large capex just to get up and running while also subjecting the firm to significant disadvantages such as diminished economies of scale and diversification.
    Sep 13 01:34 PM | 3 Likes Like |Link to Comment
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