Dear Friend,

“If you want to get the right answer, pay a researcher to go and get it for you” is a truism in business as well as politics, and a glance at today’s Daily Telegraph newspaper provides a magnificent example of expensive research adding no particular value.

Under the banner “Living in an ugly area makes you obese”, the paper reports on a UK Medical Research Council study that has looked at the incidence of clinical obesity depending on where you live. Sure enough, the study found that poorer areas contained more obese people.

But surely to anyone with half an ounce of common sense, the result would be a foregone conclusion?

Not wishing to state the obvious, poorer people have less money and have to eat poorly as a consequence. They are also less well educated about the benefits of a balanced diet than their muesli-chomping, organic vegetable-crunching middle class counterparts. This is not their fault, but simply the way life is.

Poorer people also tend to have less free time to go down to the gym, and probably don’t usually have enough money to pay the fees — and anyway, there are hardly any gyms in poorer areas!

And if I were poor and had few prospects, why would I worry needlessly about whether I put on a few extra pounds by eating the cheap and plentiful fatty comfort foods that I love, but are seemingly so despised by those higher up the social scale?

The point here is that there is no conclusion to be drawn, but researchers have decided to find one anyway. The conclusion might just as well be that being obese makes you live in a poorer area, or that rich people eat less.

So what’s the reinsurance angle to all of this?

It’s simple — those who put too much faith in underwriting models beware — do study the data by all means, but always be extremely careful when it comes to drawing meaningful conclusions!

Dear Friend,

Ultimately all of us in the reinsurance sector are in the business of paying claims of all sizes and descriptions.

And scanning through the London Times this morning I’ve found a particularly strange claims story. Apparently a young French student at Edinburgh University who was also a keen amateur psychic inadvertently caused a fire at his lodgings in the most bizarre way.

It seems the crystal ball he had left on his widow sill funnelled and focused the watery Scottish sunlight so effectively that it set fire to a pile of washing and started a blaze that destroyed his apartment and those of two unfortunate neighbours.

I bet he didn’t see that one coming!

And with tropical storm Irene moving incredibly slowly towards a possible rendez-vous with Washington DC or even New York City it is always good to remind ourselves that in this business anything is possible

Dear Friend,

In the UK we have a famously colourful popular press. It’s often chided for its inaccuracy, triviality and childish obsession with celebrity, but just occasionally it is capable of expressing in simple words what much of the population is feeling.

Today is one of those days — “Get back in your cave” the headline of the Sun newspaper tells Ayman al-Zawahri, supposed right hand man of Osama Bin Laden, after a tape showing the terrorist gloating over the recent bombs in London popped up on the Al-Jazeera Arabic TV network.

At times like these a little British pluck and good humour can go a long way to raising spirits. But as we know, the problem is not Mr al-Zawahri in his cave, wherever it may turn out to be — it is young disillusioned British citizens who have decided to strike at their neighbours.

The global terrorism problem is much more complex than a simple black and white analysis will allow and the chances of it “getting back into its cave” any time soon is pretty remote.

So in this environment it is all the more remarkable that almost four years on from 9/11 a US Treasury survey of US insurance buyers has found that roughly four in ten of buyers with exposures in big cities still buy no terrorism cover whatsoever. Where's the sense in that?