It's sad and i'm sure extremely frustrating for residents &...

It's sad and i'm sure extremely frustrating for residents & businesses impacted that it's taken 7 years and counting to resolve the mess. The positive, as you say, it's that the debacle has led to a change in policy - commercial insurers rather than the EQC handled Kaikoura claims from the outset to prevent the double-handling issue created by the over/under $100k threshold.

In terms of returns on capital, my global and very basic assumption for insurers is that they earn roughly their cost of capital through the cycle - if claims expense goes up, they boost policy costs to offset it, and vice versa. Insurance is a homogeneous product so the insurers can't offer much differentiation between themselves except for price, which is why in most markets your insurance choices as a consumer are between 3-4 established, large players who all sell more or less the same banana. TWR is targeting 12-14%, and i'd guess the top end of that range is aspirational and hard to achieve - 14% would be above their cost of capital and would be very hard to do consistently given they have a structural cost disadvantage against IAG and Suncorp. At ~12%, the business would be roughly earning its CoC implying it should trade roughly at book value, so the way i look at TWR is you have to buy it at a big discount to book to make good money and assume it'll trade up to book over the next 2-3 years. Buying companies like REITs, insurers, LICs at big book discounts and waiting for them to trade up to book generally works out fine over time, albeit insurers have more risk due to the structure of their business -they are effectively writing deep out-of-the-money put options meaning their revenue is limited to the premiums they charge, but the downside can blow out quickly in a disaster scenario.