One of the Lloyds Insurance Brokers and trading derd cheap on a p/E of only just over 4. There is of course a reason for this and it was the termination of talks with Highways Insurance Holdings Plc (late april) were both parties jointly terminated a possible combining of their respective businesses.

Investors took this as a negative sign with Cox and the shares plummeted and have been well oversold.


The plusses are that you can snap this up at a P/E of 4.2

2 Directors have bought into the recovery

The share trades at a large discount to the sector

Last results were excelent

The forward statement is very encouraging and business is well on track

The share is in uptrend and has been for 4 consecutive days.





please DYOR.

cheers GF.

Have you noticed the tax charge was just 8.2% for the year.

Back to a normal tax charge of 30% this will surely impact earnings per share & therefore p/e?

Looking at last years profits the tax charge was just 4.3m. On a normal 30% tax charge they would have had 15.63m deducted from profits & therefore eps.

reference COX INsurance there was a big ? mark as to whether their reserves were adequate which is so vital with insurers as so often final claims costs are higher than even prudent estimates.

how is the pension fund....massively under funded. i do not know

are their substantial options in favour of executives which could greatly water down ones equity holding.

i wondered as to the real reason for the departure of UTLEY who had developed a fine career since his days at the halifax insurance company.

utley was close to wood of DIRECT LINE fame and fortune. i continue to hold a substantial number of cox shares in anticipation of a takeover from WOOD.. ..my holding is at a sharp loss following the twin towers disaster. also i had no idea that cox was a specialist insurer of nuclear reactors in russia. one never knows what horrible risks an insurer is taking on and that was the case with cox albeit a reasonably successful exit was made in lieu of possible liquidation.

Strange MPW777 that you own a substantial number of Cox shares but yet you dont know about their positive reserves, their very adequate pension fund and you also make these other claims. Very strange I feel, as I check out everything possible before buying into a share and I can tell you this I have no fears on any of the negatives that you have put forward and neither as the top fund manager Adrian Paterson of the Artemis UK Growth Fund who as bought a substantial holding. I feel there maybe other funds also buying into this after last weeks very large buys.

Could you please give the thread some insight as to why you have not checked out these issues although you hold a substantial number of Cox shares????????.

cheers GF.

Identified by the Value investor Stephen Bland of the Motley Fool as a cheap value share, please see link.

http://www.fool.co.uk/valueinvesting/2004/vi040611.htm

cheers GF.

Here it is again.
http://www.fool.co.uk/valueinvesting/2004/vi040611.htm

cheers GF.

Oh and just to clear things up on the tax front, one item which was certainly misunderstood or misrepresented by a previous poster. From the companys last stated accounts.................

Taxation

The Group has significant tax losses available to shelter the results of
operations for a number of years to come. Recognising this and the
predictability of much of the Group's profit streams in 2001 the Group
established a deferred tax asset of approximately 40m. Following a further
review of future profit streams, and agreement with the Inland Revenue of the
treatment of items arising from the discontinuation of Commercial the Group has
recognised a further amount of approximately 22m.

cheers GF.

Is that from 2001, three years ago goldfinger?

mpw777 you say:
reference COX INsurance there was a big ? mark as to whether their reserves were adequate which is so vital with insurers as so often final claims costs are higher than even prudent estimates.

how is the pension fund....massively under funded. i do not know


Do you have any further info on this please?

Oh & if they have sheltered losses still g/f why was there a tax charge at all?

For those posters on the thread bears or bulls and who are not out to deliberately mislead, re- to tax, please see RNS 17th March 2004, results for year ended 2003. Alongside the annual report and accounts this also clarifys, note the present and future tax postion of the company.

cheers GF.

Just ticked up a penny, NICE. Way undervalued on a P/E of just over 4.

cheers GF

Guys,

This dispute has rumbled on for some time now and there is obviously a certain amount of bad feeling here.

I have received complaints from both sides about different posts and posters and myself and Mike have taken action where we have deemed it necessary.

It is obvious that from time to time there will be disputes of this nature when views conflict. I would ask that we now return to sensible debate.


Ian

This is one reason I see also for the low rating:
From the RNS 17th March:

Calculation of inwards reinsurance claims remains subject to further subjective
assessment because the Company must rely on estimates of loss provided by the
intermediate insurer or reinsurer.

Reinsurance recoveries represent the amounts expected to be recoverable from the
syndicate's reinsurers in respect of reported gross losses. As currently
estimated, gross ultimate claims will exceed the vertical limit of the Group's
whole account reinsurance protections. Calculation of such recoveries is
particularly sensitive as to whether or not reinsurers will follow direct
writers, should the courts deem that the attack on the WTC constitute two losses
rather than one. After taking legal advice, management consider that the likely
treatment from reinsurers should not prove disadvantageous to the Group. It
remains difficult to reach a final decision prior to resolution of the dispute
and establishment of a legal ruling regarding the underlying claim. Should
reinsurers argue successfully that the reinsurance policy should respond on a
one event basis only, even though the inwards claim was deemed to be two losses,
the resulting net loss to the Company would increase materially from the
estimates currently provided. The amount of reinsurance recoveries also remains
sensitive to potential insolvencies of reinsurers, with a current assumption
that there will be no major default.

Whilst the directors consider that the loss estimate is the best that can be
made on the basis of information currently available, it remains subject to
uncertainties as described above. Further information could be received which
may cause the estimate to be adjusted, either upwards or downwards. The cost or
benefit of any such future adjustments will be reflected in the Financial
Statements for the period in which the adjustments are made. It may take a
number of years to resolve these uncertainties.

IanT,

Thank you, I hope you will continue to take action, more often even. I am often so fed up of seeing certain names crop up I don't even read the posts. The main reason I renewed my membership with Shares is to read the sensible information packed BB and wish that some folks would mind their manners and find other ways to pass their time.

There, been wanting to say that for a long time.

angi,

I appreciate your comments. A little tip to help you filter out any poster whom you do not wish to read would be to use the squelch facility. therefore, you can read through the posts you want to read unhindered.

Ian

IanT

Thanks again, I don't know why I didn't think of that before, it's amazing.

third eye posting no 15

posting no 20 gives you a part response. however it is also the case that one just does not know what insurers are underwriting and how adequate are their reserves. many insurers do not even have a 'wing and a prayer' i have an active knowledge of this scenario. over the decades most insurers have priced for turnover and not for profit. for instance when INDEPENDENT went down AXA and ROYAL SUNALLIANCE took on automatically all former business of independent which was offered by insurance brokers. complete madness...it turned out that,for example, royal sunalliance was nearly broke solvency-wise and could well have been forced out of business

as regards the pension fund of COX my point is that there is so much funny business within pension funds coupled with their liabilities that the trading company can be ,in reality, a pensions office. all trading companies can or will encounter severe difficulties with a final salary pension fund . bradstock is a fine example....and the shareholders of W.H. SMITH would be in a more favourable bid position if their pension scheme had not given so much power to the trustees of the final salary pension scheme. thus one even should examine the pension deed itself which really no one is able to do. i hope this helps goldfinger and third eye. i shall obtain a copy of cox accounts and look at what they have currently to say about their pension fund...with a pinch of salt.

Can we insure against problematic insurers ? lol

Thanks mpw777 the notes in the accounts re: 17 March are well worth reading

Just to put things straight and out in the open so that at least one bear who is intent on giving out misleading information (yet again)but yet I feel knows the truth...........................................................

Cox Insurance Holdings PLC
14 June 2004



14 June 2004


For immediate release


Cox Insurance Holdings Plc ('Cox')

Clarification Statement re terminated discussions with Highway Insurance
Holdings Plc ('Highway') and robustness of reserve position


The Board of Cox has become aware of a press report which suggests that Cox may
be insufficiently reserved to meet its existing and future claims and which
speculates on the reasons behind the termination of Cox's discussions with
Highway. The Board of Cox wishes to correct a number of material inaccuracies
contained in the press report, clarify the events leading up to the Board's
withdrawal from the Highway discussions and confirm the robustness of the
Group's reserves as actuarially reviewed and included in its audited accounts.

Termination of discussions with Highway

On 30 April 2004, the Board of Cox announced that it had terminated discussions
with the Board of Highway regarding a possible combination of their respective
businesses, having determined that a transaction with Highway would not be in
the best interests of Cox's shareholders. At the time, Cox did not divulge any
background to the breakdown in discussions. However, in the light of misinformed
speculation, Cox now believes itself to be obliged, amongst other things, under
the UK Listing Rules to make some clarifying comments.

The termination of discussions with Highway was initiated by Cox after its Board
concluded that, although a combination with Highway could have delivered
substantial synergies, a transaction would not be suitably accretive either to
Cox's net assets or earnings based upon the expected amount of retained
business, reserving, and the need to conform accounting standards across the
combined group.

After becoming aware of Cox's concerns, Highway presented its draft views of
Cox's reserving position including comments attributed to EMB, Highway's
actuarial advisers, which purported to show that Cox's reserve position was
inadequate. At no stage prior to this presentation had Highway or EMB discussed
their views of Cox's reserving position with Cox's management or actuarial
advisers. On receiving this presentation, Cox promptly examined in detail each
of the statements relating to its reserve position and shared the presentation
with its own actuarial advisers. The Cox Board was fully advised of this
presentation and management's analysis and concluded that there was no substance
to the suggestion that Cox was under-reserved.

Robust reserving

Cox reaffirms that its own reserves position is robust. The audited consolidated
Group accounts of Cox include its share of the claims reserves held by Syndicate
218 at Lloyd's in respect of claims notified and claims incurred but not yet
notified to the Syndicate. The Syndicate's actuarial advisors, Deloitte
Actuarial & Insurance Solutions, reviewed the level of reserves required and
confirmed on 27 April 2004 that the amounts provided were adequate as at 31
December 2003. Cox confirms that the reserves included in its audited
consolidated Group accounts at that same date, which were audited by
PricewaterhouseCoopers, are adequate to cover its claims exposures.

As Cox stated in its announcement of 11 June 2004, a prudent approach to
underwriting and reserving is the fundamental characteristic of the business
philosophies of Cox and Syndicate 218 at Lloyd's and is the major factor behind
Syndicate 218's unparalleled success in delivering over 30 years of unbroken
profit.

Cox's track record, and that of Syndicate 218, demonstrate that their
methodologies for estimating claims liabilities are prudent, combining thorough
analysis of historical experiences and expert assessment of future trends,
taking into account the particular characteristics of different classes of
business.

Future development

On 11 June 2004, Cox announced the appointment of a new Group Chief Executive,
Andrew Fisher, to spearhead the next phase of the company's development. The
whole of the Cox Board, including the two principal shareholders represented on
it, are enthusiastically supportive of accelerating the delivery of enhanced
shareholder value by actively seeking out appropriate acquisitions and by
growing Cox's strong portfolio of businesses. With a strengthened management
team at the helm, the company is very well positioned to achieve its goals and
build on its position as a leader in the UK retail insurance market.

ENDS

Enquiries:

Cox Insurance Holdings Plc 01277 200111
Peter Owen, Chairman
James Morley, Finance Director

Hogarth Partnership Limited 020 7357 9477
Rachel Hirst/John Olsen