felanders/preprocessed huggingface dataset:
The following investments held as of December 31, 1996, exceeded ten percent of stockholders' equity: (000's Omitted) As of December 31, Amortized Estimated Amortized Estimated Value Market Value Market
On July 12, 1996, the company closed an offering of $65,000,000 of Convertible Subordinated Debentures. These securities were placed in Europe pursuant to Regulation S under the Securities Act of 1933. The debentures pay an annual cash yield of 3% payable semi-annually, are convertible into the company's common stock at $17.125, and mature on July 12, 2003 unless previously converted or redeemed. The debentures are redeemable, in whole or in part, at the option of the holders, on September 30, 2001, at 124.25% of their principal amount (which in essence reflects deferred interest at a compounded rate of 4.25%), plus accrued but unpaid cash interest at the coupon rate of 3%. The debentures are redeemable, at the company's option, on or after June 30, 1999, at certain specified declining redemption prices (starting at 103% of principal value) plus accrued but unpaid cash interest (at the rate of 3%) and accrued deferred interest (at a compounded rate of 4.25%). The debentures may be redeemed any time after August 15, 1996, at the company's option at their principal amount plus accrued cash interest (at the rate of 3%), but with no payment for accrued deferred interest, if the average closing price of the company's common stock equals or exceeds $23.12 f or 20 consecutive trading days. The debentures are unsecured obligations of the company, subordinated to all existing and future senior indebtedness. Approximately $35,000,000 of the net proceeds of the offering were used to repay existing bank debt, $20,000,000 was contributed to American and the balance was used for other general corporate purposes. 6. Credit Agreement: ____________________ On April 8, 1996, the company entered into a $35,000,000 credit agreement with The First National Bank of Chicago (First Chicago), Fleet National Bank (Fleet) and Boatmen's First National Bank of Kansas City (Boatmen's), as Lenders. On that same date, the company borrowed the entire $35,000,000, using the proceeds to repay existing bank debt, fund the cash portion of the acquisition of FBG and for general corporate purposes. On July 12, 1996 the company paid off the existing bank debt from the proceeds of the Convertible Subordinated Debentures.
Deferred acquisition costs related to annuity products are evaluated quarterly by comparing our actual profitability to our expectations. Expected profitability considers, among other assumptions, our estimate of future asset returns that determine the future fees we will earn, the costs we expect to incur associated with minimum death benefit or other contractual guarantees, and other profitability factors. If actual asset returns do not differ significantly from our expectations, they do not result in a change in the rate of amortization of deferred acquisition costs. Where actual asset returns differ significantly from expectations, future asset return assumptions are evaluated using a reversion to mean approach. Under the reversion to mean approach, we consider historical returns over a period of time and project returns for a future four-year period so that the investments underlying the annuities grow at a targeted return for the entire period. A calculated rate of return over the four future years, which we refer to as the look-forward period, is determined so that this calculated rate, together with the actual rate of return for the historical period, produces the targeted return for the entire period. If the calculated rate of return is consistent with our range of expectations in light of market conditions, we use it to project the asset growth for the next four years. If the calculated rate of return is not supported by our current expectations, we adjust the rate of return for purposes of these computations. For contract years after the look-forward period, we project asset growth using our long-term rate, currently an 8% annual blended rate of return, which reflects an assumed rate of return of 8.85% for equity type assets. Beginning in the second quarter of 2002 and continuing throughout 2002, we utilized a rate of return lower than the calculated return, which contributed to our additional amortization of deferred acquisition costs during the second and third quarters of 2002. The equity rate of return used in the immediate four-year look-forward period varies by product, but was under 10% for all of our variable annuity products for our evaluation of deferred policy acquisition costs as of December 31, 2003. For the average remaining life of our variable annuity contracts in force as of December 31, 2003, our evaluation of deferred policy acquisition costs is based on a 7.7% annual blended rate of return that reflects an assumed rate of return of 8.9% for equity type assets. Deterioration in market conditions may result in increases in the amortization of deferred policy acquisition costs, while further improvement in market conditions may result in a decrease in the amortization of deferred policy acquisition costs.
Management’s Discussion and Analysis of Financial Condition and Results of Operations below presents the Company’s operating results for each of the two years in the period ended December 31, 2014, and its financial condition as of December 31, 2014. Except for the historical information contained herein, this report and other written and oral statements that the Company makes from time to time contain forward-looking statements, which involve substantial known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of results to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. See the section of this report entitled “Special Note Regarding Forward-Looking Statements.” Among the factors that could cause actual results to differ materially are those discussed in “Risks Factors” in Item 1A of this report. In addition, the following Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in connection with the information presented in the Company’s consolidated financial statements and the related notes to its consolidated financial statements included in Part IV of this report.
Our sales of STM and ancillary products focus on the large and under-penetrated segment of the U.S. population who are uninsured or underinsured, which includes individuals not covered by employer-sponsored insurance plans, such as the self-employed as well as small business owners and their employees, individuals who are unable to afford IMM premiums, underserved “gap populations” that require insurance due to changes caused by life events: new graduates, divorcees, early retirees, military discharges, the unemployed, part-time and seasonal employees and customers seeking health insurance between the open enrollment periods held each year by the Exchanges created under the PPACA.
Adjusted net income per share is computed by dividing adjusted net income by the weighted average number of diluted Class A and total Class B shares for each period.
Comparability between the years ended December 31, 2014 and 2013 is affected by acquisitions during those years. Secured was acquired in July 2013; HP and ASIA were acquired in July and August 2014, respectively.
Our selling, general and administrative (“S, G & A”) expenses primarily consist of personnel costs, which include salaries, bonuses, commissions, stock-based compensation, payroll taxes and benefits. S, G & A expenses also include selling and marketing expenses and travel costs associated with obtaining new distributor relationships. In addition, these expenses also include expenses for outside professional services and technology expenses, including legal, audit and financial services and the maintenance of our administrative technology platform. In addition, the insurance brokerage operating expenses of Secured, ASIA and ICE are included in this category.
Future policy benefits are actuarially determined reserves, which are calculated to meet future obligations and are generally payable over an extended period of time. Principal assumptions used in the establishment of liabilities for future policy benefits are mortality, surrender rates, policy expenses, investment yields and inflation. These estimates and assumptions are influenced by historical experience, current developments and anticipated market trends. At December 31, 2006 and 2005, future policy benefits were $408.7 million and $420.5 million, respectively. Included within future policy benefits are liabilities for GMDB and GMIB provisions contained in the variable products that Merrill Lynch Life issues. Merrill Lynch Life regularly evaluates the assumptions used to establish these liabilities, as well as actual experience and adjusts the GMDB and/or GMIB liability balances with a related charge or credit to earnings (“unlocking”), if actual experience or evidence suggests that the assumptions should be revised. For the years ended December 31, 2006 and 2005 the favorable impact on pre-tax earnings related to GMDB and GMIB liability unlocking was $10.7 million and $4.3 million respectively. There was no unlocking during 2004. See Note 6 to the Financial Statements for a further discussion of GMDB and GMIB liabilities.
All other deposits includes deposits on modified guaranteed annuities and immediate annuities as well as renewal deposits on existing life insurance and fixed annuity contracts that are no longer manufactured.
Net income per share $ 0.86 $ 1.72 $ 1.35 $ 1.53 $ 1.53
The acquisition of Citizens Security Group, combined with growth in the existing book of Meridian business, caused an increase in 1996 annualized direct written premiums of approximately 34 percent. Future synergies are expected as the Company begins to take further advantage of Citizens Security's strength in working with certain business associations and as Meridian provides a farm product and certain commercial lines products to Citizens Security. The Company strives for a balanced book of property and casualty business including personal, commercial and farm lines.
Effective August 1, 1996, Citizens Fund , ICO and Citizens Security Mutual Insurance Company ("Citizens Security Mutual"), the former majority shareholder of CSGI, became participants in a reinsurance pooling arrangement with Meridian Mutual and Meridian Security, in which the underwriting income and expenses of each entity are shared. The participation percentages of the Company's insurance subsidiaries total 74 percent. Prior to August 1, Meridian Security and Meridian Mutual were the only participants in the reinsurance pooling arrangement, of which Meridian Security assumed 74 percent of the combined underwriting income and expenses of the two companies. (See Note 5.)
Realized gains or losses on disposition of investments are determined on a specific identification basis. Unrealized gains and losses resulting from changes in the valuation of both equity securities and fixed maturities available for sale are recorded directly in shareholders' equity, net of applicable deferred income taxes.
Net change in unrealized appreciation (depreciation): Fixed maturities, available for sale $ (2,150,596) $ 16,373,654 $(16,819,514) Equity securities 2,692,197 5,104,315 (1,696,054) Cumulative effect of accounting change for certain investments --- --- 6,743,818 Deferred income tax from cumulative effect of accounting change for certain investments --- --- (2,326,617) Deferred income tax benefit (expense) (242,000) (7,354,000) 6,325,616 Net change in unrealized appreciation (depreciation) $ 299,601 $ 14,123,969 $ (7,772,751)
Outstanding at January 1 $11.69 313,781 $10.88 328,401 $ 8.30 97,713 Granted 14.04 31,000 14.27 37,000 11.81 278,280 Exercised during the year 5.75 (4,042) 5.75 (30,521) 10.98 (47,592) Canceled during the year 9.51 (37,415) 12.20 (21,099) --- --- Outstanding at December 31 12.28 303,324 11.69 313,781 10.88 328,401
(1) Included in net realized gains (losses) are other-than-temporary impairments of $7,836, $11,167, $38,660, $340,153 and $48,184 for 2011, 2010, 2009, 2008 and 2007, respectively.
The DAC asset is tested annually to ensure that future premiums or gross profits are sufficient to support the amortization of the asset. Such testing involves the use of best estimate assumptions to determine if anticipated future policy premiums and investment income are adequate to cover all DAC and related claims, benefits and expenses. To the extent a deficiency exists, it is recognized immediately by a charge to the statement of operations and a corresponding reduction in the DAC asset. If the deficiency is greater than unamortized DAC, a liability will be accrued for the excess deficiency.
Includes the effect of recording revisions of prior year reserves, known as reserve development. The dollar amount and the percentage point effect on the loss ratio of these reserve revisions were a reduction of $5.1 million, or 1.2%, for the year ended December 31, 2007, a reduction of $5.3 million, or 1.4%, for the year ended December 31, 2006, a reduction of $23.3 million, or 6.7%, for the year ended December 31, 2005, a reduction of $0.6 million, or 0.2%, for the year ended December 31, 2004, and an addition of $39.3 million, or 12.9%, for the year ended December 31, 2003.
At December 31, 2007, the range of reasonable loss reserve estimates, net of reinsurance receivables, calculated was from $268 million to $387 million. Ranges of reasonable loss reserve estimates are not calculated for the sub-lines of business. Management believes that the range calculated over total reserves provides the most meaningful information due to the importance of correlation of losses between the sub-lines of business related to the impact of general economic conditions.
The expense ratio decreased to 55.0% for 2006 as compared to 58.1% for 2005. The decrease in the expense ratio primarily reflects the earned premium growth discussed above achieved with a minimal increase in underwriting expenses.
The Company’s income tax expense was $39.7 million for 2007, $32.8 million for 2006 and $11.7 million for 2005. The effective income tax rates were 30.1%, 28.4% and 23.4% for 2007, 2006 and 2005, respectively. The effective tax rates are lower than the statutory tax rates primarily due to the Company’s ability to exclude interest income from its significant investments in tax-exempt securities. The impact of tax-exempt securities on taxable income was $21.4 million, $18.1 million and $16.3 million for 2007, 2006 and 2005, respectively.
CNA Surety classifies its fixed income securities and its equity securities as available-for-sale, and as such, they are carried at fair value. The amortized cost of fixed income securities is adjusted for amortization of premiums and accretion of discounts, which is included in net investment income. Changes in fair value are reported as a component of other comprehensive income.
Gross realized investment losses were $1.0 million for 2007 due to the recognition of impairment losses on certain fixed income securities as discussed below. Gross realized investment losses were $1.4 million for 2006 due to the recognition of impairment losses and additional losses on the subsequent sale of certain fixed income securities as discussed below. The gross realized investment gains in 2005 resulted primarily from the Company’s sale of its interest in De Montfort Group, Ltd in the first quarter of 2005.
The Company is a leading provider of surety and fidelity bonds in the United States. According to the Surety Association of America (“SAA”), the surety and fidelity segment of the domestic property and casualty insurance industry aggregates approximately $6.4 billion in direct written premiums, comprised of approximately $5.1 billion in surety premiums and $1.3 billion in fidelity premiums.
· Level 1: quoted prices in active markets for identical assets;
The following table details the profit sharing commission revenue sensitivity of the E&S Commercial business unit for each effective quota share treaty at 5.0% above and below the current estimate, which we believe is a reasonably likely range of variance ($ in thousands).
Management overview. During fiscal 2011, our total revenues were $322.8 million, representing an approximately 5% increase over the $307.1 million in total revenues for fiscal 2010. This increase in revenue was primarily attributable to increased earned premium due to increased production by our Personal Lines and E&S Commercial business unit, a new space risk Specialty Program entered into during the first quarter of 2011 and the acquisition of our Workers Comp business unit during the third quarter of 2011. Further contributing to the increased revenues were favorable profit sharing commission revenue adjustments and higher net investment income. These increases in revenue were partially offset by lower earned premium in our Standard Commercial business unit due to continued competition and continued soft market conditions and lower recognized gains on our investment portfolio.
Corporate. Total revenue for corporate increased by $4.3 million for the year ended December 31, 2010 as compared to the prior year. Recognized gains of $8.4 million on our investment portfolio during 2010 as compared to recognized gains of $3.0 million on our investment portfolio during the same period in 2009 were partially offset by lower net investment income of $1.1 million primarily due to increased allocated capital to our business units to support the growth in production in our Personal and Specialty Commercial Segments.
Net income included realized investment gains after taxes of $41 million, $152 million and $124 million in 1994, 1993 and 1992, respectively. Decisions to sell securities are governed principally by considerations of investment opportunities and tax consequences. Thus, realized investment gains and losses may vary significantly from year to year. As a result, net income may not be indicative of our operating performance for the period.
The property and casualty subsidiaries have consistently invested in high quality marketable securities. Taxable bonds in our domestic portfolio comprise U.S. Treasury, government agency and corporate issues. Approximately 85% of these bonds are either backed by the U.S. government or rated AA or better by Moody's or Standard & Poor's. Of the tax-exempt bonds, practically all are rated A or better, with approximately half rated AAA. Both taxable and tax-exempt bonds have an average maturity of between 8 and 9 years. Actual maturities could differ from contractual maturities because borrowers may have the right to call or prepay obligations. Common stocks are high quality and readily marketable. Foreign investments have quality and maturity characteristics similar to our domestic portfolio. We reduce the risks relating to currency fluctuations by
We also continue to increase our emphasis on managed care outside New York by offering preferred provider organizations which are networks of health care providers that offer cost savings compared with traditional indemnity plans.
Effective January 1, 1994, the Corporation adopted SFAS No. 115, Accounting for Certain Investments in Debt and Equity Securities. SFAS No. 115 established more stringent criteria for classifying fixed maturity securities as held-to-maturity. Thus, upon adopting SFAS No. 115, the Corporation reclassified $4.2 billion of fixed maturities as available-for-sale which were previously classified as held-to-maturity. At December 31, 1994, 35% of our fixed maturity portfolio was classified as held-to-maturity compared with 79% at year-ends 1993 and 1992.
Net Investment Income -- Consolidated pretax net investment income increased 12.4% in 1995 to $226.8 million reflecting additional funds from operations available for investment. Aftertax net investment income in 1995 increased 11.2% to $192.5 million.
GEICO Corporation's equity in changes in unrealized appreciation (depreciation) on investments reported at market value, after deferred income tax effects, is reported directly in shareholders' equity. Realized gains and losses on sales of investments, as determined on a specific identification basis, are included in the statements of income. Investments for which the current market value has declined below cost are reviewed and a realized loss is recorded if it is warranted by the specific circumstances.
Reinsurance receivables related to unpaid claims and prepaid reinsurance premiums are reported as assets.
Reserves have been reduced by approximately $101.3 million, $85.4 million and $77.0 million at December 31, 1995, 1994 and 1993, respectively, for anticipated salvage and subrogation recoveries.
The Corporation's insurance subsidiaries are involved in both the cession and assumption of reinsurance with other companies. Reinsurance treaties are maintained for the purpose of insuring certain excess and catastrophe risks of the subsidiaries and a portion of most risks for Resolute Reinsurance Company. Pursuant to an agreement with the Florida Hurricane Catastrophe Fund for the year beginning June 1, 1995, 75% of GEICO's homeowners losses in excess of $24 million per occurrence are reimbursed by the Fund subject to a constraint of overall money available to the Fund. GEICO has no other catastrophe reinsurance effective in any other states. The Corporation and its insurance subsidiaries remain liable to the extent the reinsuring companies are unable to meet their treaty obligations; however, certain amounts ceded are supported by letters of credit or are indemnified.
Comparison of Fiscal Year 1997 to Fiscal Year 1996 and Fiscal Year 1996 to Fiscal Year 1995.
The Company's assets at December 31, 1998 included $26.9 million in short-term investments which are readily convertible to cash without market penalty and an additional $43.3 million of fixed maturity investments maturing in less than one year. The Company believes that these liquid investments, plus the expected cash flow from current operations, are more than sufficient to provide for projected claim payments and operating cost demands. In addition, the Company's reinsurance program is structured to avoid serious cash drains that might accompany catastrophic losses. In the event competitive conditions continue to produce inadequate rates and the Company chooses to further reduce volume, the Company believes that the liquidity of its investment portfolio would permit it to continue to pay claims as settlements are reached without requiring the disposal of investments at a loss, regardless of interest rates in effect at the time.
Net premiums written by the Company's U.S. insurance subsidiaries for 2001 equaled approximately 24% of the combined statutory surplus of these subsidiaries. Premium writings of 200% to 300% of surplus are generally considered acceptable by regulatory authorities. Further, the statutory capital of each of the insurance subsidiaries substantially exceeds minimum risk based capital requirements set by the National Association of Insurance Commissioners. Accordingly, the Company has the ability to significantly increase its business without seeking additional capital to meet statutory guidelines.
Realized net capital gains were $5.1 million in 2001 compared to $12.5 million for 2000. The current year's net gain consisted of gains on equity securities of $7.3 million and losses on fixed maturities and other investments of $2.2 million. Realized net gains for 2001 and 2000 included other than temporary writedowns totaling $2.1 million and $5.0 million, respectively.
(4) Other catastrophe losses include adverse (favorable) development on loss reserves for other catastrophes occurring on or after January 1, 1988.
REVENUES. Net premiums earned, as adjusted, increased by 4.7% to $893.3 million in 1995 from $853.3 million in 1994, generally consistent with the change in net premiums written.
make payment on account of such Adverse Development. Through December 31, 1996, cessions under the Stop Loss Agreement have aggregated $140.2 million.
Global Lifestyle net earned premiums, fees and other income increased $1.91 billion to $7.09 billion for the Twelve Months 2019 compared with $5.18 billion for Twelve Months 2018, primarily due to full-year contributions from TWG and growth in Connected Living, primarily driven by growth in new mobile subscribers and higher trade-in volumes in our repairs and logistics business, and continued growth in Global Automotive.
The recorded reserves represent our best estimate at a point in time of the ultimate costs of settlement and administration of a claim or group of claims, based upon actuarial assumptions and projections using facts and circumstances known at the time of calculation. The adequacy of reserves may be impacted by future trends in claims severity, frequency, judicial theories of liability and other factors. These variables are affected by both external and internal events, including, but not limited to: changes in the economic cycle, inflation, changes in repair costs, natural or human-made catastrophes, judicial trends, legislative changes and claims handling procedures.
the extent of data segmentation - data should be homogeneous yet credible enough for loss development methods to apply;
On May 1, 1999, the certificate of authority of Health Power HMO was revoked by ODI for failure to meet statutory financial requirements. Since that time, and in accordance with the ODI revocation order, Health Power HMO has been winding-up its business under the supervision of ODI, but without judicial involvement. This windup is substantially complete, and Health Power HMO is in the process of distributing all of its assets in payment of the claims of its creditors. However, Health Power HMO will not have sufficient assets to pay the claims of all of its creditors. Health Power, Inc. believes that neither it nor any of its other subsidiaries are liable for any claims against Health Power HMO. Furthermore, Health Power, Inc. does not intend to fund, or cause any other subsidiary to fund, any deficits of Health Power HMO. However, there can be no assurance that creditors of Health Power HMO will not initiate legal actions against Health Power, Inc. or any of its other subsidiaries seeking satisfaction of their unpaid claims against Health Power HMO. The legal fees and other costs of defending such legal actions could be significant. Furthermore, due to the fact-intensive nature of these actions and the unpredictability of courts in this area of the law, there can be no assurance that Health Power, Inc. or its other subsidiaries will be successful in defending any such legal actions. Any such legal actions having an unfavorable outcome to Health Power, Inc. or any of its other subsidiaries could have a material adverse affect on their financial condition and results of operations.
Employee and director stock options. The Company granted market price stock options in 1999, 1998 and 1997 to employees and directors. The stock options granted in 1999, 1998 and 1997 have terms of 10 years. The options granted to directors were vested immediately on the grant date. The options granted to employees vest at the rate of 25% per year on each of the first four anniversaries of the date of grant. Options granted to various executives vest 100% at the end of six years (subject to acceleration to a two-year period depending on the performance of the Company or at the discretion of the Compensation Committee). Options are granted at the fair market value of common stock at the date of grant. Accordingly, the Company has not recognized any compensation cost for these stock options granted in 1999, 1998 and 1997.
The effects of applying SFAS No. 123 in this pro forma disclosure are not indicative of future amounts. SFAS No. 123 does not apply to awards prior to 1995.
Net investment income increased by 2.4% to $75.5 million in 1997 from $73.7 million in 1996. Investment income growth is due to a higher average level of invested assets in 1997 versus 1996 combined with a shift in the average asset allocation from municipal securities to higher yielding preferred stocks and taxable fixed income securities. The Company had net realized gains on investments of $2.2 million in 1997 compared with losses of $0.9 million in 1996.
INCOME TAXES. Income taxes were $9.2 million in 1997 compared to $10.2 million in 1996 due to lower pre-tax income in 1997 partially offset by an increase in tax on net capital gains in 1997 versus net capital losses in 1996.
LINE OF CREDIT. In February 1998, the Company obtained an unsecured revolving credit line of $100.0 million. The Company has not borrowed against this line of credit. The credit agreement provides for interest at a fixed rate equal to the Interbank Offered Rate for periods of up to one year plus a margin of 20 to 40 basis points, and contains financial covenants with respect to minimum net worth and statutory surplus, maximum debt to total capitalization, and minimum risk-based capital levels. The credit agreement also restricts the Company's ability to pay stockholders' dividends in a single year in excess of 50% of the average of the prior three years net income.
The Marketform, EMCVS, PRM and MSA acquisitions were accounted for as purchases, and the operations of the acquired businesses are included in MMI's consolidated financial statements since the dates of acquisition. Assets acquired, liabilities assumed, and the excess of cost over net assets purchased were as follows (in thousands):
Deferred income taxes reflect the net tax effect of temporary differences between the amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of MMI's deferred tax assets and liabilities as of December 31, 1998 and 1997 are as follows (in thousands):
Policy acquisition expenses are commissions paid to our producers, offset by ceding commissions we receive from our reinsurers. Policy acquisition expenses also include premium taxes paid to states in which we are admitted to conduct business. Policy acquisition expenses increased to $43.5 million for the year ended December 31, 2010 as compared to $37.2 million for the same period of 2009, but, as a percentage of net earned premiums, decreased to 21.7% for the year ended December 31, 2010 compared to 22.1% for the same period of 2009. The dollar increase year over year is the result of growth in gross written premiums in 2010 as compared to 2009 while the percentage decrease is primarily attributable to reduced reinsurance costs and higher retentions.
The Company operates through its subsidiaries in the U.S. and Bermuda. Significant differences exist in the regulatory environment in each country. The table below depicts the Company’s operations by geographic location for the years ended December 31, 2010 and 2009 (dollars in thousands):
Net cash provided by operations was $59.6 million for the year ended December 31, 2010 and $53.3 million for the year ended December 31, 2009. The cash flow from operations increased in 2010 compared to 2009 primarily due to increased premium writings.
We are incorporated under the laws of Bermuda and, under current Bermuda law, are not obligated to pay taxes in Bermuda based upon income or capital gains. We have received an undertaking from the Minister of Finance in Bermuda pursuant to the provisions of The Exempted Undertakings Tax Protection Act 1966, which exempts us and our shareholders, other than shareholders ordinarily resident in Bermuda, from any Bermuda taxes computed on profits, income or any capital asset, gain or appreciation, or any tax in the nature of estate, duty or inheritance until 2035. Exclusive of our United States subsidiaries, we do not consider ourselves to be engaged in a trade or business in the United States and accordingly, do not expect to be subject to direct United States income taxation. Our U.S. subsidiaries are subject to taxation in the United States.
Net title service revenues consist of gross title insurance premiums less fees paid to underwriters. Fees to underwriters represent the portion of gross title insurance premiums paid by the Company's underwritten title companies to FNTIC and CTIC, pursuant to the terms of the Issuing Agency Agreement, and similar fees paid by the Company's other underwritten title company subsidiaries.
In January 1999, the Company agreed to purchase 100% of the assets of Pacific Printers, a printing company providing affiliated and non-affiliated reproduction of forms and printing material. The purchase price of this acquisition was $125,000, paid in cash.
In February 2000, the Company purchased 100% of the stock of Pioneer Land Title Corporation ("Pioneer"), a New York corporation. Pioneer provides title and escrow services in the state of New York. The purchase price was $1.8 million, $360,000 paid in cash and a $1.4 million promissory note that bears interest at 6.6% per annum from the purchase date through the fourth anniversary date.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2000, 1999 AND 1998
It is the practice of the Company to purchase investment grade fixed maturity securities. The securities in the Company's portfolio are subject to economic conditions and normal market risks and uncertainties.
ATC leases certain of its premises and equipment under operating leases that expire at various dates. Several of these agreements include escalation clauses and provide for purchases and renewal options for periods ranging from one to five years during 2000.
In 1997, ATC entered into a capital lease agreement with FNTIC, which expires in June 2007, for three title plants. The gross amount of title plant recorded under affiliated capital lease is $815,000 at December 31, 2000 and 1999, respectively.
The information required by this Item is incorporated by reference from portions of The PMI Group, Inc. 2001 Annual Report to Stockholders under the heading "Eleven-Year Summary of Financial Data" filed as part of Exhibit 13.1.
The information required by this Item is incorporated by reference from portions of The PMI Group, Inc. 2001 Annual Report to Stockholders as part of Exhibit 13.1.
Consolidated Statements of Cash Flows for the years ended December 31, 1996, 1995 and 1994. 35
Non-cash investing and financing activities: Issuance of HSB convertible preferred stock in exchange for EIG, Co. preferred stock in 1996 (See note 2). Acquisition of EIG through issuance of EIG, Co. preferred stock of $20 million in 1994.
Deferred tax assets and liabilities are generally determined based on the difference between financial statement and tax bases for certain assets and liabilities using tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are allowed if future realization is more likely than not. Deferred income taxes are provided for unrealized appreciation/depreciation on fixed maturities and equity securities available for sale, prepaid acquisition costs, loss reserve discounting, unearned premiums, certain employee benefit costs and other items which are the result of temporary differences in the treatment of such items for tax and financial statement purposes.
At December 31, 1995, engineering services receivable included $59.7 million related to Radian Corporation.
(b) Radian International LLC, an affiliate of Hartford Steam Boiler, was accounted for under the consolidation method of accounting in 1995 and the equity method of accounting for 1996. As such, $0.3 million of receivables is included in the 1995 balance but included on a different line in the 1996 financial statements (not included above).
We currently expect that our cash and fixed maturity investments of $11 million at December 31, 2007 will be sufficient to meet our anticipated cash requirements for at least the next 12 months. The timing and amounts of our working capital expenditures are difficult to predict, and if they vary materially, we may require additional financing. If we require additional equity financing, it may be dilutive to our stockholders and the equity securities issued in a subsequent offering may have rights or privileges senior to our common stock. If debt financing is available, it may require additional restrictive covenants with respect to dividends, raising capital and other financial and operational matters, which could impact or restrict our operations. If we cannot obtain adequate financing on
acceptable terms, we may be required to reduce the scope of our marketing or operations, which could harm our business, results of operations and our financial condition.
Information under the caption "Financial Highlights" on the inside front cover page of the Company's 2000 Annual Report to Shareholders is incorporated herein by reference.
Information under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations" on pages 26-29 of the Company's 2000 Annual Report to Shareholders is incorporated herein by reference.
The Company’s principal executive offices are approximately 38,000 square feet in size and are located at 919 Third Avenue, New York, New York 10022. The Company entered into a sublease for approximately 28,000 square feet of this space, which commenced on March 1, 2003 and expires on July 30, 2016. In April 2005, the Company signed an amendment to the sublease, for approximately 10,000 square feet of additional space. The sublease expires on July 30, 2016. The minimum monthly rental payments of $141,276 under the amended sublease
The following table sets forth selected consolidated financial data, which was derived from our historical consolidated financial statements included in our annual reports on Form 10-K for the years then ended. You should read the following together with “
While the Company is currently achieving significant rate increases in its offshore energy book as a result of recent industry-wide hurricane losses, there is no assurance that such rate increases will be sustained during 2006. The excess of loss reinsurance market for the marine and energy line of business has also significantly tightened in 2006, resulting in increases in both reinsurance costs and net loss retentions to the Company in 2006. As a result of the tightening in the reinsurance market, the Company excluded energy business with exposures in the Gulf of Mexico from its ocean marine reinsurance program for 2006. The Company has purchased additional reinsurance protection for this portion of its energy business to reduce the potential impact of future catastrophe losses to the Company. The Company also intends to monitor its overall concentration of rig exposures in the Gulf of Mexico, which may result in a reduction in policy count in 2006. In light of the foregoing, the level of gross and net energy writings for 2006 remains uncertain at this time.
Inland marine/fire gross premiums written increased by 2% for the year ended December 31, 2004 when compared to 2003. The increase in premium writings reflected additional production from policies covering inland marine, fire, and motor truck cargo and new production sources in the surety class. Gross premiums written in 2004 reflected mildly lower market rates. Both net premiums written and net premiums earned increased 9% and 16%, respectively, over the comparable 2003 amounts primarily reflecting higher net loss retention levels.
Other liabilities increased to $26.6 million as of December 31, 2004 from $15.4 million for 2003 due in large part to increases in funds received from reinsurers and interest expense payable on the Company’s 6.5% senior notes.
Under the Common Stock Repurchase Plan, the Company may purchase up to $55,000,000 of the Company’s issued and outstanding shares of common stock on the open market. The Company repurchased 98,816 shares of its common stock in 2003. During 2003, the Company also issued 400,000 treasury shares in conjunction with the equity sale to Conning Capital Partners VI, L.P. There were no repurchases of common stock under this Plan during 2005 and 2004.
The Company entered into four transactions during the period 1995 through 1997 which affect the comparability of its results of operations between periods. In July 1995, the Company acquired all of the outstanding common stock of Victory Life for $42.8 million. The Victory Life transaction (the "Victory Life Acquisition") added approximately $270 million of insurance liabilities and $32.9 million of notes payable to the Company's consolidated balance sheet.
On May 23, 2017 the Company entered into a definitive merger agreement with Northern Plains Capital Corporation. The merger transaction closed on July 31, 2017. NPCC shareholders received .5841 shares of US Alliance Corporation stock for each share of NPCC stock owned. USAC issued 1,644,458 shares of common stock to holders of NPCC shares.
Pretax net investment income decreased 4.3% to $11.6 million in 2002 from $12.1 million in 2001. The decrease in pretax net investment income is due to lower investment yields resulting from funds from operations and reinvestments being invested at current market rates which were lower than the average portfolio yields. The Company expects to experience lower investment yields due, in part, to the reinvestment of proceeds from security prepayments, calls and maturities and the investment of positive cash flows from operations in securities yielding less than the average portfolio rate. At December 31, 2002, portfolio balances, excluding assets held in Separate Accounts and unrealized capital gains and losses on fixed income securities, were comparable to December 31, 2001. Pretax net investment income in 2001 was comparable to 2000 as the effect of higher portfolio balances was more than offset by increased investment expenses.
At December 31, 2002, the Cash balance was $130.2 million compared to $43.8 million at December 31, 2001. The increase of $86.4 million is primarily a result of timing differences between when deposits from fixed annuity sales were received and when those deposits were transferred to ALIC under the Company's reinsurance agreement. As a result, there was a corresponding increase in Payable to affiliates.
- Management believes the reserves for life-contingent contract benefits are adequate to cover ultimate policy benefits, despite the underlying risks and uncertainties associated with their determination when payments will not be made until well into the future. Reserves are based on many assumptions and estimates, including estimated premiums to be received over the assumed life of the policy, the timing of the event covered by the insurance policy, the amount of contract benefits to be paid and the investment returns on the assets purchased with the premiums received. The Company periodically reviews and revises its estimates. If future experience differs from assumptions, it may have a material impact on the results of operations ceded to ALIC.
Matching the investment portfolio maturities to the cash flow demands of the type of insurance being provided is an important consideration for each type of protection product and accumulation product. We continuously monitor benefits and surrenders to provide projections of future cash requirements. As part of this monitoring process, we perform cash flow testing of assets and liabilities under various scenarios to evaluate the adequacy of reserves. In developing our investment strategy, we establish a level of cash and securities which, combined with expected net cash inflows from operations and maturities and principal payments on fixed maturity investment securities, are believed adequate to meet anticipated short-term and long-term benefit and expense payment obligations. There can be no assurance that future experience regarding benefits and surrenders will be similar to historic experience since withdrawal and surrender levels are influenced by such factors as the interest rate environment and general economic conditions and the claims-paying and financial strength ratings of the insurance subsidiaries.
The following table presents, for securities sold during 2003 and 2002, the amount of material losses recorded and the fair value at the sales date:
Generally, AmerUs Group and our non-life subsidiaries file a consolidated federal income tax return. The life insurance subsidiaries file separate federal income tax returns, except for ILIC and Bankers Life which together file a consolidated tax return beginning in 2002. The separate return method is used to compute the provision for allocating federal income taxes. Deferred income tax assets and liabilities are determined based on differences among the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws.
For the year ended March 31, 2019, other income and expenses totaled $961,201, consisting of $849,806 of expenses incurred pursuing potential financing alternatives, $17,840 additional NIBs impairment on newly acquired NIBs, and $93,555 in interest expense.
During the year ended March 31, 2019, the Company recorded a net loss before income taxes of $2,056,118 and had no income tax expense or benefit as a result of a full valuation allowance on the net deferred tax asset.
The fair value of our investment in NIBs is determined by evaluating the sum of present value of the future cash flows expected from the NIBs. Our current projections for the future cash flows are based off of various assumptions that are subject to uncertainties and contingencies, which are difficult to predict and are subject to future events that may impact our estimates and interest income. Therefore, subsequent to the purchase and on a regular basis, these future estimated cash flows are evaluated for changes. If the determination is made that the future estimated cash flows should be adjusted to the point of a material change in revenue, a revised effective yield is calculated prospectively based on the current amortized cost of the investment, including accrued accretion.
Fair values for fixed interest securities are based on quoted market prices, where available. For fixed interest securities not actively traded, fair values are estimated using values obtained from independent pricing services.
Fair values of other assets and liabilities approximate their carrying values due to their short-term nature.
Commissions and other operating costs and expenses decreased approximately $1,286,000. Expenses incurred by the insurance subsidiaries during 1995 exceeded the 1994 amount by approximately $151,000. Commissions, new business expenses and premium taxes increased approximately $509,000, while the general overhead expenses decreased approximately $358,000. The remaining decrease of $1,437,000 results from a decrease of continuing operation expenses incurred by WorldNet (approximately $1,708,000) resulting from the termination of certain unprofitable contracts, (approximately $1,208,000) and the relocation of WorldNet to Florida from Texas in 1994 (approximately $500,000) offset by an increase by the Parent Company
(approximately $271,000). Amortization of the present value of future profits was approximately $205,000 for 1995 compared to $237,000 in 1994, which decrease is due to the lower amount of insurance in force.
American Progressive and American Pioneer are required to maintain minimum amounts of capital and surplus as determined by statutory accounting. The minimum statutory capital and surplus requirements of American Progressive and American Pioneer as of December 31, 1996 for the maintenance of authority to do business were $2,500,000 and $2,130,000, respectively, but substantially more than this is needed to permit continued writing of new business. At December 31, 1996 the adjusted statutory capital and surplus, including asset valuation reserve, of American Progressive and American Pioneer were $7,920,366 and $13,379,191 respectively.