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Tower Group International, L.Ş. Message Board

  • combined_ratio combined_ratio Sep 29, 2013 10:07 PM Flag

    Everything I Hear is BAD news

    Everything I hear about the Tower situation is BAD news. I've heard rumors that the company was unable to purchase surplus relief reinsurance. Moreover, the situation is supposedly unraveling so rapidly that a shot-gun sale to a run-off company is the most likely outcome for this highly-leveraged carrier. There remains any number of questions, such as (1) the future of the reciprocal exchanges controlled by Tower, and (2) what happens to the legal liability that is eventually adjudicated in this situation. One wonders what role will be played by those state insurance department involved in the situation and when the relevant rating agencies will respond to the deteriorating financial situation. In the meantime, its hard to imagine any respectable agent or broker placing new or renewal business with Tower under the current circumstances. Consequently, one also wonders if the company will face a liquidity squeeze in the near-term. The current week will probably hold some interesting developments for Tower.

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