Construction-focused insurer Gable Holdings hopes to write £30 million of premiums this year and will consider acquisitions.

Cayman Islands-registered and AIM-quoted Gable, which lost £379,000 in the 11 months to last October, transformed itself last month by acquiring Brown Duke AG, a would-be insurance underwriting concern also based in a tax haven, this time Liechtenstein. After this move, which involved a £4.5 million placing at 12.5p, Brown Duke renamed itself Gable Insurance AG, whose insurance products are being distributed by Hogarth Underwriting Agencies.

Hogarth is owned by experienced insurance practitioner Bill Dewsall, who is also Gable Holdings' chief executive officer, on a £350,000-a-year salary plus monthly bonuses of up to £100,000 related to Gable Insurance AG's performance. Dewsall, who will progressively move the operations of Hogarth into Gable, holds 17 per cent of Gable Holdings, as does financier Andrew Regan's Corvus Capital, also AIM-quoted.

John Duffield's New Star Asset Management, Killik & Co and Lloyd’s insurance veteran Ron Brown also hold shares in Gable Holdings, which provides packages of contractor's risk, public liability and employer's liability to medium-sized construction companies. Dewsall says Gable quotes rates based on turnover and fixed with the help of a sophisticated proprietary computer programme, with an upper limit of £5 million per policy on construction and public liability and £10 million on employer's liability.

Gable will not write catastrophe insurance, excess cover or reinsurance, though it has its own reinsurance from others in place. Dewsall says premium rates have recently eased modestly but are 'still 70 to 75 per cent up on three to four years ago'.

He insists the company, which deals only through specialist brokers, will sacrifice premium income rather than write policies on insufficiently tough terms. 'I am ready to be vicious with clients who look like costing us money,' he asserts.

Dewsall adds that Gable will be on the look-out to acquire companies or teams of key people in the market fallout he expects from last year's US hurricanes. With corporate acquisition targets, he warns it will first be necessary to do thorough due diligence to ensure there are no claims on past policies looming.

Analysts at City Capital Corporation reckon Gable could make £3.5 million pre-tax this year on £30 million gross written premiums, with £9.3 million pre-tax on £40 million premiums on the cards for 2007, after first premiums have come in but before there will have been time for many claims. For 2008, City Capital sees £12.5 million pre-tax on £52.7 million.

At 4.75p, up 1p today, Gable Holdings' shares value the company at £16.4 million. They could reward a punt.

Gable Holdings	AIM	£5.33m	4.75p	0.00p
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