BRO
#Yes, let me clarify.
So this will be an important point is we had said $30 million to $40 million over a two- or three-year period, not a one-year, <UNK>.
And we said that around a 40 to 50 basis point impact to this year.
Still a good range that we see right now.
Yes.
No, <UNK>, there really isn't and we haven't quantified that because what you are seeing is, remember we talked a lot about catastrophic property but that doesn't mean that traditional inland property isn't ultra-competitive.
And so some carriers as you know want to play in areas where the rate online is higher which might be in a CAT prone area whereas other carriers have a risk appetite that says we don't want to play in let's say coastal property but we want to play on inland property.
So all of a sudden that becomes competitive and the perception of risk is maybe different at one carrier versus another meaning rate online, what they want to put in their portfolio, all of that other stuff.
So I don't want to just give you the impression we talked about property in terms of CAT property because the prices are down dramatically.
That does not mean that inland property is not very competitive and we see sometimes people do crazy things there too.
But no, we have not given any guidance on that.
Can I take that, <UNK>, for just a second.
Let's make sure that ---+ and we've tried to articulate this, that some of our businesses that are impacted are higher-margin businesses than others or there is a growth in a business which might be a de novo business like a program that we start.
So as I said earlier and this is not an excuse, this is a statement of fact.
One, we had a services business, a TPA, that had very limited claims activity which impacted our margins.
Two, CAT property programs which are higher-margin businesses than number one, a startup but two, some of those programs that were growing nicely in Q1.
And three, would be the investment in new teammates.
So I don't want to say that it is just investment in new teammates because just like anything else, some parts of your business are under constant attack and then others might be moving right along nicely.
We just happened to have a lot of segments that are ---+ two or three segments meaning in particular a services piece and in our CAT programs, that have been under competitive pressure and we think that will continue for awhile.
So to answer your question, our margins may be like that if we continue to have results like we have just outlined in those three segments.
That is not what we want, that is not what you want and we don't manage our business that way but we intend over a long period of time for it to work out.
That was independent of the 2016.
Yes, there was.
<UNK>, the way we think about at least the mechanisms for buybacks and the reason why we generally trend towards ASRs is we think they are a very efficient way in which to buy shares back out of the marketplace.
It does give us an upfront share pop which we like as part of the program, allows us to buy through blackouts, etc.
so they can run and it puts ultimate execution back on whoever the agent is.
That is what they do every day and that is why we prefer and we think they are a cost-effective way to go.
That doesn't mean that that is the only way that we would ever buy shares back in the marketplace.
So we are always looking at different opportunities and different programs that are out there.
If there ever was a significant dislocation in our market value or price, we would look at the appropriate options that are out there.
Irrespective of any of them, you still got all of the 10b-18 rules that you still have to comply with.
So <UNK>, as you have seen and read, some of these technology backed companies are very well funded and some of them are coming either to a stop or they are going through gyrations.
And what I would say is this, do we believe that there could be a segment of small commercial purchased online.
And the answer is, yes, that could be the case.
The carriers are careful about what I would call comparison shopping.
So if you have a model which actually lets you basically compare three companies, standard companies that you know by name against each other in their small business units, they don't like that because they try to differentiate their product on coverage and service and which some can and do but in that instance when you have an online rater, many times it is just you are just stacking them up against each other and it is a spreadsheet.
That said, what we have found whether it be in personal lines or in small commercial, there are certain complexities that come with risk particularly as an individual or as a business start to accumulate assets which they may not be familiar with the coverages that would be appropriate.
And so there is a possibility that they have what I call coverage that is stripped down that may be cheaper, cheaper, cheaper but they may be buying a Yugo as opposed to a Chevrolet or a Cadillac.
And so and do they actually know the difference in the coverages.
And so I am not aware of anything yet.
That does not mean that we are dismissing that out of hand.
Quite the contrary.
We think about how technology can play a role in our small business units as well and as we invest in our personal lines business which is actually a $90 million business as you know.
What we would say so far though, so far is the technology companies that I am aware of, they've done a good job of sizzle in terms of the marketing but I don't think that they have done as well a job in the execution of the plan where they are able to make money over a period of time.
It doesn't mean somebody is not going to do that.
It just means that we continue to watch it carefully and whether it was the online benefits related company or when Google started trying the search engine I should say started looking into selling coverage online and then has pulled back from some of that, we watch with great interest.
But we are thinking about how we invest in our small commercial from a technology standpoint and personal lines independent of that.
The first two correct on it, <UNK>, and then we said that the gain on the sale was just a little under $2 million.
The answer is we have had some activity but once again, things kind of evolve over time so you have immediate claims and then you have things that sort of roll in as well.
So we would say that the magnitude of the impact we are not fully ---+ we don't know the full impact yet, it is too early.
But we can just tell you that we have had a good number of claims already.
There is really two storms there.
If you go back, there was the mid- to late March hailstorms in Texas and that drove also some other damage.
So we've got claims off that and then obviously we've got the most recent flooding that is going on just over the last couple of days.
As <UNK> mentioned, they build over time so it is hard to determine what it will look like right now but we are starting to get some claims in.
Thank you all very much and we look forward to talking to you at the end of the second quarter.
Have a wonderful day.
