Fairfax 2026

[Munger_Disciple]

16 minutes ago, thowed said:

Still find it an interesting purchase, as they are not 'cool' restaurants compared with the buzzy 'neo-Indian' chains like Dishoom or Gymkhana, which are expanding to Dubai, NYC etc. but I'm guessing that's the playbook.

That's exactly the playbook as the article quotes Watsa. Whether it succeeds or not, who knows?

Edited March 24 by Munger_Disciple

[Hoodlum]

41 minutes ago, Munger_Disciple said:

FT article on Fairfax's MW Eat subsidiary (Indian restaurants):

https://archive.ph/IHWQS

From the artilce: The group made a £4.4mn pre-tax profit on sales of £32mn last year and paid a £4.7mn dividend.

 

It looks like Veeraswamy is about to lose its lease. 

 

 

Some interesting details were revealed by Prem at last weeks Centenary Celebratory dinner at Veeraswamy,

 

MW Eat will now pursue global growth. Watsa wants to bring its top restaurants to Canada, the U.S., the Gulf and elsewhere. He envisages a 10-fold growth in sales in a decade and having “30 or 40” Masala Zones in Canada, Mathrani says. Watsa talks of “building it slowly over time” and has asked the founders to stay on as advisers and help to recruit new leaders for this phase.

 

[Hoodlum]

And here are some details on the acquisition process.

 

https://www.restaurantonline.co.uk/Article/2026/03/17/london-indian-restaurant-veeraswamy-celebrates-its-100th-birthday-aid-legal-dispute-with-the-crown-estate/

 

[thowed]

58 minutes ago, Munger_Disciple said:

That's exactly the playbook as the article quotes Watsa. Whether it succeeds or not, who knows?

 

Ah, cheers - should have read it first!  I have a slight concern how they differentiate themselves from other Indian restaurants, unless it is currently enough just to be an 'Anglo-Indian restaurant' which is quite possible.

 

But the others (JKS brands and Dishoom) have built a pretty white-hot reputation over the past decade or so, which feels like some solid intangible capital.

 

Anyway, as a chunky FFH shareholder, I wish them well!

[Hoodlum]

Britt is adding new capacity for Cargo insurance.

 

https://www.reinsurancene.ws/rsa-and-brit-launch-global-project-cargo-consortium-build-with-285m-capacity/

 

RSA Insurance’s UK Specialty Lines business and Brit Ltd have joined forces to unveil ‘BUILD,’ a Project Cargo consortium that stands as one of the largest in the global cargo market.

 

 

Open for business, this consortium offers a guaranteed capacity of up to USD 285 million for Project Cargo risks on a worldwide scale.

 

Project Cargo insurance addresses the cover and protection needs for equipment susceptible to loss or damage during transit.

[petec]

On 3/24/2026 at 12:59 PM, Hoodlum said:

Masala Zones

 

This is just a terrible name.

[thowed]

9 hours ago, petec said:

 

This is just a terrible name.

 

Ha ha - I don't mind it.  I've been to them a few times and they're fine.  They were well-regarded about 15 years ago I'd say, but there's just a lot more buzzy competition nowadays in their space.

 

I'm not really the target market any more, but if I was going for a cheaper curry in London, there are so many others I'd choose before them e.g. Hoppers, Dishoom, Gunpowder etc.  But maybe expanding abroad is easier as a clean slate?

[Parsad]

14 hours ago, petec said:

 

This is just a terrible name.

 

4 hours ago, thowed said:

 

Ha ha - I don't mind it.  I've been to them a few times and they're fine.  They were well-regarded about 15 years ago I'd say, but there's just a lot more buzzy competition nowadays in their space.

 

I'm not really the target market any more, but if I was going for a cheaper curry in London, there are so many others I'd choose before them e.g. Hoppers, Dishoom, Gunpowder etc.  But maybe expanding abroad is easier as a clean slate?

 

They'll do ok here in their core markets.  Canadians have a somewhat discerning palate and like one-off independent restaurants for ethnic food.  Where I live we've seen many young, talented Indian chefs starting fusion style Anglo-Indian restaurants that Vikram Vij got started here like 30 years ago.  Here a few:

 

https://sulaindianrestaurant.com/

 

https://tastybistro.ca/

 

https://clovetheartofdining.restaurants-us.com/

 

Cheers!

[Hamburg Investor]

Wow - Treasury yield stands at 4.418%.

 

It‘s just as always: Folks expect the yield to go up (or down). 
 

And than something happens. A war. Another war. Lehman. Covid. Tariffs. No tariffs. War is over. Trump versus Fed. Euro Crisis. Chinese reducing treasuries. A huge deficit. The expectation it might fall. The reality, that it doesn’t.

 

I am clearly NOT saying, that I would have known anything of that before. I just do not know. 
 

I just don’t get, why others think, they could. If I understood Buffet right, than he can‘t too; still others are sure, they know.

 

Anyway: So maybe FFH running their portfolio at 2.5 years these days is a good move again?

[UK]

7 minutes ago, Hamburg Investor said:

So maybe FFH running their portfolio at 2.5 years these days is a good move again?

+1

[Junior R]

37 minutes ago, Hamburg Investor said:

Wow - Treasury yield stands at 4.418%.

 

It‘s just as always: Folks expect the yield to go up (or down). 
 

And than something happens. A war. Another war. Lehman. Covid. Tariffs. No tariffs. War is over. Trump versus Fed. Euro Crisis. Chinese reducing treasuries. A huge deficit. The expectation it might fall. The reality, that it doesn’t.

 

I am clearly NOT saying, that I would have known anything of that before. I just do not know. 
 

I just don’t get, why others think, they could. If I understood Buffet right, than he can‘t too; still others are sure, they know.

 

Anyway: So maybe FFH running their portfolio at 2.5 years these days is a good move again?

good news for FFH they could now push their estimates another couple years

[TwoCitiesCapital]

1 hour ago, Hamburg Investor said:

Wow - Treasury yield stands at 4.418%.

 

It‘s just as always: Folks expect the yield to go up (or down). 
 

And than something happens. A war. Another war. Lehman. Covid. Tariffs. No tariffs. War is over. Trump versus Fed. Euro Crisis. Chinese reducing treasuries. A huge deficit. The expectation it might fall. The reality, that it doesn’t.

 

I am clearly NOT saying, that I would have known anything of that before. I just do not know. 
 

I just don’t get, why others think, they could. If I understood Buffet right, than he can‘t too; still others are sure, they know.

 

Anyway: So maybe FFH running their portfolio at 2.5 years these days is a good move again?

 

It just depends - we could go back and forth on what the "right" positioning was every 6-months when they go up, or down, 0.50% in response to something. 

 

Even with this rise, they're still not as high as they were in 2023, or mid 2024, or most of 2025. So maybe it wasn't the best they ran at 2.5 years? 

 

My point of view isn't so much I think they should be going long bonds because bonds are going to kick ass or that rates are going to crater. It's more of that the neutral positioning for Fairfax shouldn't be 0-years of duration, but rather the duration of their liabilities. They can make moves around that, but ~3.5-4 years should be the default if they don't have a view on rates. 

 

Rates were broadly declining for the last year (until the last 1-2 months) and as mentioned are still lower than many points over the last 3 years. Maybe in 6-months, the energy shock will have sent the global economy into a recession to ease off the energy demand and we're back below 4s and will be wishing they had locked in 4.33% for the next 3-4 years

Edited March 27 by TwoCitiesCapital

[Parsad]

1 hour ago, Hamburg Investor said:

Wow - Treasury yield stands at 4.418%.

 

It‘s just as always: Folks expect the yield to go up (or down). 
 

And than something happens. A war. Another war. Lehman. Covid. Tariffs. No tariffs. War is over. Trump versus Fed. Euro Crisis. Chinese reducing treasuries. A huge deficit. The expectation it might fall. The reality, that it doesn’t.

 

I am clearly NOT saying, that I would have known anything of that before. I just do not know. 
 

I just don’t get, why others think, they could. If I understood Buffet right, than he can‘t too; still others are sure, they know.

 

Anyway: So maybe FFH running their portfolio at 2.5 years these days is a good move again?

 

+1!  Cheers!

[Hamburg Investor]

10 minutes ago, TwoCitiesCapital said:

 

It just depends - we could go back and forth on what the "right" positioning was every 6-months when they go up, or down, 0.50% in response to something. 

 

Even with this rise, they're still not as high as they were in 2023, or mid 2024, or most of 2025. So maybe it wasn't the best they ran at 2.5 years? 

 

My point of view isn't so much I think they should be going long bonds because bonds are going to kick ass or that rates are going to crater. It's more of that the neutral positioning for Fairfax shouldn't be 0-years of duration, but rather the duration of their liabilities. They can make moves around that, but ~3.5-4 years should be the default if they don't have a view on rates. 

 

Rates were broadly declining for the last year (until the last 1-2 months) and as mentioned are still lower than many points over the last 3 years. Maybe in 6-months, the energy shock will have sent the global economy into a recession to ease off the energy demand and we're back below 4s and will be wishing they had locked in 4.33% for the next 3-4 years

 

But maybe it’s a better idea to think of interest rates being „normal“ around 4% or 5% - and thus going longer or shorter in dependence of where rates actually are? 
 

Of course you could still be on the wrong site, as Mr. Market seems to rule bond yields too over short timeframes

 

But if 4%(or 5% or whatever) should be normal, than it might be a good idea to invest into 1-years and if it’s at 8%, than go for 10-years (or whatever). 
 

At least, if it swings around 4%, than this might be the better strategy over the lobg run (might be lumpy of course…)

 

I am not an expert, so please feel free to criticize; happy to learn…

[TwoCitiesCapital]

If rates are normal at 4-5%, is argue that should mean 'normal' positioning - i.e. offsetting their liability duration of ~3.5-4. 

 

Moving to zero when rates are 0% is fine. But they're no longer at 0%, are no longer "rising" as defined by the longer term trend, have been well in excess of trailing inflation for the last few years.

 

That doesn't guarantee rates are going to go down, but I'd argue at the very least it should imply neutral positioning instead of an underweight. 

 

I just want to know that when the TRS is bleeding cash, and their equity portfolios are cratering, which will happen at some point, that Fairfax has the guarantee of billions in fixed income interest coming in and doesn't find themselves rolling bonds at 0% too .. 

[Maverick47]

On 3/23/2026 at 5:22 PM, Maverick47 said:

@CapitalAlloc Really good question.  A couple of things might help reconcile this gross undiscounted claims view to what we see in the financials.  I don’t have the answers, but maybe some others can chime in.

 

I am assuming that what we see in the financials would be on a discounted, IFRS 17 basis, net of the impact of ceded reinsurance premiums and losses, and the notes in the annual report a page or two after why you’ve shown also refer to a release of a risk adjustment on prior years’ claims, along with prior year loss development.  
 

The risk adjustment is, I believe, a cushion that management elects to include in the loss reserves.  When management speaks of the impact of prior year loss development, the release of this risk adjustment, when no longer needed, is included under the overarching category of prior year reserve development, is not explicitly shown in the chart you show…yet can be quite significant — not that far away from a billion dollars in value in 2025 if I’ve read this correctly.

 

The notes also refer to management setting this risk adjustment at a confidence level of approximately 85%.

 

If I had to guess how to interpret that, I might suggest that the reserving actuaries first make a central estimate of what they believe the historical data indicates should be held as gross undiscounted loss reserves, and then provide management with a reasonable range around that estimate.  Selecting exactly what the actuaries work indicates is the central estimate, would be at the 50th percentile, meaning that there would be an equal chance the final reserve would end up higher or lower than that.  An 85% percentile selection, may include enough of an additional reserve estimate that it would be expected to be adequate or redundant 85% of the time, with only an estimated 15% chance it would prove to be inadequate.

 

Prem in his letter indicates that for the last 19 years, Fairfax has had net reserve releases each year, for an aggregate benefit to earnings of just under $7 billion.  I expect that the release of the risk adjustment on prior claims is a large part of this.

 

The above is largely speculation and guesswork on my part.  Happy to be corrected if anyone knows more about the nuances of prior year development as reported in Fairfax’s financials.

@CapitalAllocAs I’m reading the annual report in more detail, I noticed that the paragraph right before the development of gross reserves chart that you’ve shown clearly indicates that this view does NOT include the risk adjustment.  I was confused, as were you, by the apparently not insignificant adverse development for many of the calendar years prior to 2025.  How to square that with the statements by management that there has been favorable reserve development in each of the last 19 years?
 

The answer has to be that the risk adjustment margin that management includes in their booked reserves are more than sufficient to outweigh any adverse development on the undiscounted reserves shown in the chart…values that do not include this margin.

[A_Hamilton]

21 minutes ago, Maverick47 said:

@CapitalAllocAs I’m reading the annual report in more detail, I noticed that the paragraph right before the development of gross reserves chart that you’ve shown clearly indicates that this view does NOT include the risk adjustment.  I was confused, as were you, by the apparently not insignificant adverse development for many of the calendar years prior to 2025.  How to square that with the statements by management that there has been favorable reserve development in each of the last 19 years?
 

The answer has to be that the risk adjustment margin that management includes in their booked reserves are more than sufficient to outweigh any adverse development on the undiscounted reserves shown in the chart…values that do not include this margin.

No. When Prem writes that there has not been adverse development in each of the last 19 years he is referring to in the operating insurance businesses, not RUNOFF. The table you are looking at includes RUNOFF where there has been persistent negative development running into the billions of dollars over the past 19 years.

[SafetyinNumbers]

16 hours ago, A_Hamilton said:

No. When Prem writes that there has not been adverse development in each of the last 19 years he is referring to in the operating insurance businesses, not RUNOFF. The table you are looking at includes RUNOFF where there has been persistent negative development running into the billions of dollars over the past 19 years.

The triangles did change a lot post IFRS 17 from persistently showing favourable development to showing adverse development. Runoff wouldn’t explain that would it? 

[CapitalAlloc]

On 3/27/2026 at 8:43 PM, A_Hamilton said:

No. When Prem writes that there has not been adverse development in each of the last 19 years he is referring to in the operating insurance businesses, not RUNOFF. The table you are looking at includes RUNOFF where there has been persistent negative development running into the billions of dollars over the past 19 years.

If I would play advocate of the devil here: wouldn't there be a potential governance risk in that whenever a business is showing adverse developments, it would just become classified as runoff and therefore Fairfax can continue to claim its decade-long track record?

[Viking]

28 minutes ago, CapitalAlloc said:

If I would play advocate of the devil here: wouldn't there be a potential governance risk in that whenever a business is showing adverse developments, it would just become classified as runoff and therefore Fairfax can continue to claim its decade-long track record?

 

I look at Fairfax's insurance operations using two different buckets:

• Insurance and Re-insurance (ongoing)
• Runoff

Insurance and re-insurance - great business. 

Runoff - shitty business (especially since they sold much of the 'good stuff' a couple of years ago). 

 

Each year we get adverse development from runoff. I treat that in my earnings estimate as an annual expense - just like interest expense. It runs about $250 million per year (on average). A little higher in some years. A little lower in others. This is not new news.

 

A question I have is if they have been more aggressively trying to settle/wind this exposure down in recent years. Just a feeling I have reading between the lines of how they talk about it. 

 

When they report results, Fairfax lumps runoff together with Eurolife's life insurance business (kind like an 'other' bucket). I like this separation from going insurance/reinsurance. But it does muddy the water when looking at the total insurance business. 

 

With the sale of the Eurolife's life insurance business it will be interesting to see how they continue to report runoff.

 

Importantly, the ongoing insurance/reinsurance business has exploded in size over the past 8 years. At the same time, with the sale of Riverstone Europe, the size of the runoff business is much smaller. Put these two developments together: runoff is nothing I worry about. For me it is an annual expense that is shrinking in importance over time (in terms of Fairfax's overall business).

 

Now when I followed Fairfax 25 years ago, runoff was a big deal. And $200 million in adverse development meant something. Not so much today. Fairfax has done an amazing job of pivoting their insurance business (growing the good stuff). Yes, more work needs to be done. They are all over it.

Edited March 28 by Viking

[A_Hamilton]

On 3/28/2026 at 2:45 PM, CapitalAlloc said:

If I would play advocate of the devil here: wouldn't there be a potential governance risk in that whenever a business is showing adverse developments, it would just become classified as runoff and therefore Fairfax can continue to claim its decade-long track record?

Absolutely this would be a governance risk. The reality is that this is not what you see them do. Typically at acquisition they'll throw some bad books of business to runoff, but there is no perpetual moving bad books into runoff from the operating businesses.

 

Also, they've hit this item hard over time. Look at the disclosure on asbestos in 2015 - the gross liability was $1.38 billion, now it is $794 million. The cost to bring down this exposure has been insane relative to 2015 expectations, but it is coming down overall. Everyone in the space has been surprised that claims just keep coming even as the 1st generation of those exposed to asbestosis are largely passing away. There is a lot of litigation fraud, but there are also a lot of real cases where a parent worked in an asbestos laden facility and were bringing it home and child now has asbestosis. 

 

Outside of asbestos you've also had lifting of statute of limitations on various different crimes that have hurt runoff as well. There are claims on the casualty side in years that you'd have thought would be "closed" in the past because of statute of limitations that are now open again.

 

In any case, runoff is a real liability and there are likely to be many more years of adverse development here, you just capitalize the current run rate of claims at 10/12/15x and determine for yourself if the rest is still a valuable enough earnings stream.

 

I also agree with Viking's note above.

[Viking]

Compared to the market averages, Fairfax has been holding up surprisingly well since the war in the Persian Gulf started (over the past month). Yes, the stock underperformed the market averages in Jan/Feb. 

 

In Q1, operating earnings should be solid for Fairfax: underwriting income, interest and dividend income, share of profit of associates and non-insurance consolidated companies. 

 

Investment gains will be very noisy. This bucket will get hit hard with the aggressive sell-off in both stocks and bonds (spiking yields). I'll do an update tomorrow (quarter end) for the stock portfolio.

 

Of note, compared to P/C insurance peers, Fairfax is very well positioned with their fixed income portfolio (very short duration and very high quality) - the hit to book value from much higher interest rates (and widening credit spreads) will be much less for Fairfax. They will also have a chance to lock in higher yields and add duration. 

 

 

[LC]

 

6 hours ago, Viking said:

Investment gains will be very noisy. This bucket will get hit hard with the aggressive sell-off in both stocks and bonds (spiking yields).

 

 

6 hours ago, Viking said:

the hit to book value from much higher interest rates (and widening credit spreads) will be much less for Fairfax. They will also have a chance to lock in higher yields and add duration

 

 

I think it will be very interesting to see the overall portfolio movements as the investment teams (both on the equity and FI side) respond to these two factors. 

Edited March 31 by LC

[Viking]

1 hour ago, LC said:

 

 

 

 

 

I think it will be very interesting to see the overall portfolio movements as the investment teams (both on the equity and FI side) respond to these two factors. 

 

Fairfax has a lot going on right now (all expected to close in Q2):

• Sale of Eurolife's life insurance business
• Sale of half of Poseidon
• Take private of Kennedy Wilson

My guess is they may surprise us with how aggressive they have been with share buybacks in Q1. If the stock stays low, 2026 could end up being a big year for share buybacks (more than the 1 million they bought back and retired last year).

Edited March 31 by Viking

[gfp]

We can shift seamlessly from analysts claiming they are over-earning from an era of high risk free rates to worrying about mark to market losses from rising yields.  There's always something to fuss over