Subscribe to this topicForums > General Investment Discussion > Topic: Insurance
| Jun 12th 2008, 10:36 Scott Nestler |
Insurance | |
| I am starting to think that we should being back a mechanism, like the rock insurance company. Something that CEO's would contribute to that will insure at least a set value for each listed company. Today both LLFS and LCA were delisted, shareholders are now "in the wind" as far as having anyone look out for their interests. Back before the interest ban, if I had a policy on LLFS at least I would be getting something for the shares I had. Anyone have thoughts on this? |
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| Jun 12th 2008, 11:01 iVentures Volitant |
Re: Insurance | |
| That would put too much liability on the insurer as SL investments are 100% risky. It's unlike the RW where the SEC exists. An equivalent of SEC may require LL intervention. Without LL, there's no way insurance can work effectively. That brings up to my question, how efficient and promising is The Rock Insurance? iV |
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| Jun 12th 2008, 11:01 William Rustamova |
Re: Insurance | |
| Something like the WTF fund on the World Stock Exchange? I have heard nothing from about 1/3 of all SL companies (including companies like Apez and SL Exchange) for about 6 months. They might as well be delisted too. Other companies have "delisted" and "may" repay shareholder ie: SL Wizard. While going broke is not a crime, just "vanishing" sort of is .. like WSE. | ||
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| Jun 12th 2008, 11:04 Scott Nestler |
Re: Insurance | |
| iVentures, I do not know how the Rock used to do it, but they did. -Scott |
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| Jun 12th 2008, 11:39 Eliale Morigi |
Re: Insurance | |
| Up to the banking ban, The Rock paid almost 1 million lindens in insurances certificates. System was becoming quite successful on both ends. We were getting more and more attention and customers and, vice versa we were providing a protection system. Far to be perfect but a beginning. After the banking ban, obviously, we had to think about a new concept and we come out with the B.I.C. (basic insurance coverage) for listed companies. Here a brief description available on the site: 1. What is BIC aka Basic Insurance Coverage? Company CEO has to request a “Basic Insurance Coverage” for its company. The company will pay The Rock a basic monthly premium and The Rock will guarantee a coverage of 50% of the IPO value in case of bankruptcy to be payable to ALL the shareholders. If, at the moment of the application, market value is more than 20% below the original IPO, we will adjust our coverage/premium proportionally. When a company has B.I.C. (Basic insurance Coverage) our ATM’s will offer additional insurance certificates for those shareholders that are looking to have a 100% coverage. Our standards security limits and not invested cash reserves will apply as usual. Coverage is granted for bankruptcy only . Coverage is not provided if LL decides to change rules causing involuntary bankruptcies ------------------------------------------------------- Problem was that, single CEO’s, after they cashed the IPO money, did not feel the necessity of such a cost. Therefore, the only way out we saw was to propose the plan to Capex management in first place aimed to find an agreement where, in order to be listed, it was mandatory for the companies to get B.I.C.. Probably, with all the problems arose after the banking ban, our project got lost in order to take care of more immediate and understandable problems. However, we strongly believe that if the 3 CEO’s of SLCAPEX, ISE and VSTEX would mutually agree to implement such or a similar project from The Rock or any other similar company, some protection for the shareholder would be granted |
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| Jun 12th 2008, 12:10 Andy Grant |
Re: Insurance
Edited by author Jun 12th 2008, 12:11 |
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| I've thought about this and i figured the following... If the company or the investor is to pay into a insurance program, the ceo could aswell pay higher dividends or the shareholder could invest some % less... exactly same result. The only solution is for companies to offer land and/or technology/inventory as collateral. As i described here: http://intlstockexchange.com/punbb/viewpoll.php?id=287&p=2 (scroll to the very bottom of the page) Insurace/fraudfunds are just hidden costs. |
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| Jun 12th 2008, 12:28 Scott Nestler |
Re: Insurance | |
| Eliale, What would the costs for a policy be for a company trading on CapEx? |
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| Jun 12th 2008, 13:04 Eliale Morigi |
Re: Insurance
Edited by author Jun 12th 2008, 13:23 |
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| Scott, just to give you an idea, the following was a proposal which I sent to Capex end of january: Capex Protection Plan Provided by The Rock Insurance Co. Basic Coverage for Listed Companies in Business for at least 4 months: In order to get basic coverage you need to be in business for at least 4 months, obey SLCapex TOS, provide proper information to the shareholders and maintain good financial results. Cost of insurance paid by the company is 0.50% of initial IPO value per month payable the first day of each month. Our coverage in case of Bankruptcy only will be 50% of the IPO value disbursed proportionally to all shareholders. Shareholders list will be provided by Capex. Also, we are going to provide insurance certificates to the shareholders at 1% per month in order to give them additional protection independently. Exceptions: At the moment we accept a listed company for insurance coverage, if the market value is 15% or more below original IPO, our coverage will be proportionally less. When initial coverage is set we will maintain it. Maximum exposure limit for each company is 3 millions linden. We reserve the right to pay amounts over 50,000 lindens via Paypal. Insurance is not provided if: Linden Lab decides to ban Exchanges (act of God) Company does not paid insurance coverage Company does not obey SLCapex rules Insured avatars are part of the management or alt of the management. Company maintains 2 consecutives negative financials (in this case we can analyze the reason and decide if we can continue Insurance coverage). For IPO companies and less then 4 months old companies, I need inputs from you Again, the above was a draft proposal subject to changes. the 3 milions max limit was valid in january... since then I bought few things :-))) It is my opinion that such a plan may work if the exchanges (better all 3) impose it. Single companies alone, I have some doubts... |
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| Jun 12th 2008, 13:20 Scott Nestler |
Re: Insurance | |
| So, If a company has 10 million shares that IPO'd at 1L then the maximum number of shares to be covered would be 6 million, correct. A CEO would then have to maintain ownership of 4 million shares to maintain full coverage for share holders. And the premium per month would be 15k linden Am I correct? |
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| Jun 12th 2008, 13:30 Eliale Morigi |
Re: Insurance | |
| Let's say 10 million shares IPO, of which 51% in the hands of management, makes a total "insurable" of 4.9 millions 4.9 millions at .50% = 24.500 lindens x month In case of bankruptcy, shareholders will get 50% of 4.9 millions = 2.45 Millions proportionally disbursed. Management or alt of management 000000000000 |
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