Author Topic: TSU - Trisura  (Read 21904 times)

Pedro

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Re: TSU - Trisura
« Reply #80 on: May 07, 2020, 02:44:43 PM »
Before the hard market hit, ofsi was concerned about this offshore capacity. Their happy to take the premium but I think the concern was whether financial capacity was there to pay the losses. I believe they avoid the oversight of osfi.

I hope fronting for these players works out well and this isn't a house of cards. TRU is in my coffee can mulit bagger portfolio. Letting it ride


snowball82

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Re: TSU - Trisura
« Reply #81 on: May 09, 2020, 06:47:17 AM »
Very strong quarter !

The growth rate in USA is very high. Only $ 54 M gross premiums written for 2018 and BMO expects $ 520 M for 2021... Consolidated, they forecast $ 728 M GPW for 2021. Likely this should include some new revenues in the admitted market.   

I own a position
« Last Edit: May 09, 2020, 07:28:15 AM by snowball82 »


Broeb22

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Re: TSU - Trisura
« Reply #83 on: May 12, 2020, 07:02:13 AM »

Jurgis

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Re: TSU - Trisura
« Reply #84 on: May 12, 2020, 07:42:59 AM »
They don't plan to stay a microcap

http://www.globenewswire.com/news-release/2020/05/11/2031205/0/en/Trisura-Group-Ltd-Announces-Increase-to-Previously-Announced-Bought-Deal-Public-Offering-to-C-52-5-Million-and-Concurrent-Private-Placement-of-C-7-5-Million.html

How do you evaluate the underwriting of the fronting platform? That is the major risk to this company and its hard to handicap.

This. You basically have to trust management to have tight controls and not go off the rails. By the time you can notice something, this could implode. This is especially true because of rapid growth. So, basically, trust management.

I reduced my position in this significantly. I am just not sure how I can evaluate this beyond trusting management. I'd appreciate ideas.
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Pedro

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Re: TSU - Trisura
« Reply #85 on: May 12, 2020, 08:37:07 AM »
Just spitballing some procedures that would be ideal. I'm sure TRU management is smarter than me but something like the 3 below would make me happy:

1) No one offshore capacity re insurer takes more than a $1M line in any file. So if your putting up $30M, thats 30 players on the backend. If one doesn't pay or goes belly up, it shouldn't be a terrible hit to your bottom line. Spread your risk among-st the offshore players looking to get non cat exposure

2) A bond or some sort of reinsurance arrangement is purchased in the event one player doesn't pay. Reinsurance protection from Berkshire would be nice. Protect your downside.

3) Sufficient collateral exists for at TRU to ensure these guys dont screw you and not pay claims. Everyone accepts premium, not everyone pays and not everyone pays timely.

4) Standardized wordings so someone doesn't say "I didn't know i was covering that". An agreement on the wordings ahead of time would be prudent.

There's steps you can take to mitigate your risk but I'm lazy and haven't dug deep into TRU reporting to see what exists or whether this is made clear.

There are many fronting departments at insurers & everyone is giving capacity to MGAs. Some have tight constraints on who they front for - others less so.




snowball82

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Re: TSU - Trisura
« Reply #86 on: May 12, 2020, 01:33:26 PM »
They don't plan to stay a microcap

http://www.globenewswire.com/news-release/2020/05/11/2031205/0/en/Trisura-Group-Ltd-Announces-Increase-to-Previously-Announced-Bought-Deal-Public-Offering-to-C-52-5-Million-and-Concurrent-Private-Placement-of-C-7-5-Million.html

How do you evaluate the underwriting of the fronting platform? That is the major risk to this company and its hard to handicap.

I think you are right, this is a risk and you don't have a long track record for the USA. We have to look the management and the track record in Canada over last + 10 years. If you believe they can get the same combined ratio in USA (different biz) you will do well + the fees add significant revenues.  If not, you have to look with another perspective.

snowball82

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