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Federated National Holding Company Message Board

mutinycapital 1 post  |  Last Activity: Nov 4, 2014 7:10 AM Member since: Mar 6, 2009
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  • mutinycapital mutinycapital Nov 4, 2014 7:10 AM Flag

    Read the transcript. I'm not sure people understand the quota share reinsurance and the Monarch impact. The quota share is being recognized based on an assumed storm probability and loss ratio. The driving factor being that a major storm would occur within the next two years. This calculation would have been set up in July. Well, the hurricane season is mostly over for this year and no hurricane. That only leaves next year for a major storm. I would make the argument that FNHC will have some additional income from the quota share to recognize next year (assuming no hurricanes) which will drop straight to income. Which means that this quarter's earnings could have been higher. I also don't think Monarch is getting the recognition that it deserves. Go look at the presentation for the equity offering. The market size for that segment of business is larger than their current market. Once Monarch starts writing business, earnings will ramp even faster.

FNHC
25.66+0.36(+1.42%)Dec 26 4:00 PMEST

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