felanders/preprocessed huggingface dataset:
Loss ratio is the GAAP losses and LAE incurred as a percentage of GAAP net premiums earned. Underwriting expense ratio is the GAAP commissions, brokerage, taxes, fees and other underwriting expenses as a percentage of GAAP net premiums earned. Combined ratio is the sum of the loss ratio and underwriting expense ratio.
Commission, brokerage, taxes and fees increased by 2.6% to $977.6 million for the year ended December 31, 2013 compared to $952.7 million for the year ended December 31, 2012. The year over year changes were primarily due to the impact of the increase in premiums earned, partially offset by an increase in excess of loss business in 2013 which carries a lower commission rate than pro rata business.
Incurred losses increased by 17.2% to $954.5 million in 2014 compared to $814.7 million in 2013, primarily due to the increase in current year attritional losses of $151.5 million resulting primarily from the impact of the increase in premiums earned and less favorable development of $61.2 million on prior years’ attritional losses in 2014 compared to 2013, mainly related to an increase in A&E reserves. This increase was partially offset by a decrease of $39.3 million in current year catastrophe losses and favorable development of $33.5 million on prior year catastrophe losses in 2014 compared to 2013, mainly related to Superstorm Sandy. The $12.5 million of current year catastrophe losses in 2014 related to the Japan snowstorm ($7.8 million) and Hurricane Odile ($4.7 million). The $51.8 million of current year catastrophe losses in 2013 were mainly due to U.S. Storms ($44.8 million), the European floods ($5.0 million) and the Canadian Floods ($2.0 million).
Management estimates that the projected net economic loss from its largest 100-year event in a given zone represents approximately 11% of its projected 2015 shareholders’ equity. Economic loss is the PML exposure, net of third party reinsurance and the noncontrolling interests of Mt. Logan Re, reduced by estimated reinstatement premiums to renew coverage and estimated income taxes. The impact of income taxes on the PML depends on the distribution of the losses by corporate entity, which is also affected by inter-affiliate reinsurance. Management also monitors and controls its largest PMLs at multiple points along the loss distribution curve, such as loss amounts at the 20, 50, 100, 250, 500 and 1,000 year return periods. This process enables management to identify and control exposure accumulations and to integrate such exposures into enterprise risk, underwriting and capital management decisions.
Given the complexity of the valuation of the life insurance policies noted above, we engaged an independent outside actuarial firm to assist us in our review of the significant assumptions and methodologies that were developed by the Trust’s engaged actuary to assess whether reasonable and acceptable actuarial techniques were utilized. The actuary performing these procedures has significant industry expertise as it relates to life settlement contract valuation. We engaged the independent actuary to evaluate the methods used, assess significant assumptions, and review fair value calculations for accuracy.
The discontinuance of the TennCare and Medicare contracts have had a material adverse effect on the Company’s operations, earnings, financial condition and cash flows in fiscal 2009 and 2010.
Net loss was $5.4 million, or $(0.66) per basic share, for the fiscal year ended June 30, 2010, compared to net loss of $8.7 million, or $(1.02) per basic share, for the fiscal year ended June 30, 2009, a decrease in the net loss of $3.3 million (38%).
The net MA-SNP per member per month premium rate, based on an average membership of 699 for the year ended June 30, 2009, was $1,598 for that one-year period. The net MA-SNP per member per month premium rate, based on an average membership of 767 for the year ended June 30, 2008, was $1,228 for that one-year period.
Income tax benefit was $5,000 for the fiscal year ended June 30, 2009 compared to expense of $2.1 million for the prior fiscal year. The Company’s effective tax rate for the fiscal year ended June 30, 2009 differs from the statutory rate. This difference was primarily due to the change in the valuation allowance. The Company increased its deferred tax asset valuation allowance due to uncertainties in its expected utilization as a result of the expiration of the TennCare contract and pending expiration of the Medicare contract.
The Loan Agreement contains financial covenants. In connection with the acquisition and the execution of the Second Amendment to the Loan and Security Agreement (the “Amendment”), the lender waived the existing defaults under the Loan Agreement arising from Pulse System’s failure to satisfy (a) the Adjusted EBITDA (as defined therein) covenant as of December 31, 2009 and March 31, 2010, (b) the Funded Debt to Adjusted EBITDA covenant (as defined therein) as of March 31, 2010, (c) the Fixed Charge Coverage Ratio (as defined therein) as of December 31, 2009 and March 31, 2010, and (d) to timely deliver audited financial statements for the fiscal year ended December 31, 2009. In addition, the Amendment modified the definition of Adjusted EBITDA, to among other things, add $750,000 to the calculation to reflect the $750,000 contribution to capital made by UAHC to Pulse Systems at closing which was applied to reduce the amount of Pulse System’s debt.
(2) "Acquisition cost, net of amortization" is comprised of service fees and commissions, reinsurance ceding commissions, and deferred policy acquisition cost amortization.
Stockholders' equity was adjusted to reflect adoption of FAS 109 "Accounting for Income Taxes." The amounts shown for 1992 to 1990 were all decreased by $18,555,000 compared to amounts previously reported. Stockholders' equity per share reflects these adjustments also.
J-P's Consolidated Net Income was $239.2 million, $195.2 million and $203.2 million in 1994, 1993 and 1992, respectively. 1993's results included a charge of $24.1 million to record the cumulative effect of adopting SFAS 106 "Employers' Accounting for Post Retirement Benefits Other Than Pensions". Excluding the effect of adopting SFAS 106, 1994's Net Income increased 9.1% and 1993's Net Income increased 7.9%. At year-end 1994, J-P had either sold or reached agreement to sell two of its subsidiaries, Jefferson-Pilot Fire & Casualty and Jefferson-Pilot Title Insurance Company. Operating results of these subsidiaries, net of related income taxes, were previously included in the "Other Insurance Segment". For the current report, the results of this segment are segregated as Income from Discontinued Operations. Excluding these results from all years, Net Income increased 9.7% in 1994 and 7.7% in 1993.
Policy benefits 352,810 341,126 350,306 360,577 372,335 Expenses 78,040 73,785 70,112 69,426 68,135 Total benefits and expenses 430,850 414,911 420,418 430,003 440,470
The Company's investment strategy with respect to CMO's focuses on actively- traded, less volatile issues that produce relatively stable cash flows. CMO holdings for the years under report consist predominately of the least volatile Planned Amortization Classes and sequential tranches of federal agency issuers. During 1994, the Company liquidated its holdings of mortgage pass-through securities and reinvested the proceeds into less volatile CMO's with longer durations. Due to the high quality and liquid nature of these investments, the Company believes that the impairment risks associated with these securities are no greater than those applicable to direct agency or corporate issues.
March June September December 31 30 30 31 Revenues, including net investment income and realized gains on investments $307,248 $314,466 $ 312,455 $334,640 Benefits and expenses 228,067 228,615 225,892 238,633 Provision for income taxes 26,782 29,569 29,659 31,696
STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2002, 2001, AND 2000
First Great-West Life & Annuity Insurance Company (the Company) is a wholly-owned subsidiary of Great-West Life & Annuity Insurance Company (the Parent Corporation). The Company was incorporated as a stock life insurance company in the State of New York and was capitalized on April 4, 1997, through a $6,000 cash investment from the Parent Corporation for 2,000 shares of common stock. On December 29, 1997, the Company issued an additional 500 shares of common stock to the Parent Corporation for $500. The Company was licensed as an insurance company in the State of New York on May 28, 1997. The Company does business in New York through two business segments, as discussed in Note 12.
Separate Accounts - Separate account assets and related liabilities are carried at fair value. The Company's separate accounts invest in shares of Maxim Series Fund, Inc. and Orchard Series Fund, open-end management investment companies which are affiliates of the Parent Corporation, shares of other non-affiliated mutual funds, and government and corporate bonds. Investment income and realized capital gains and losses of the separate accounts accrue directly to the contractholders and, therefore, are not included in the Company's statements of income. Revenues to the Company from the separate accounts consist of contract maintenance fees, administration fees, and mortality and expense risk charges.
See "Five-Year Summary of Selected Financial Data" on page 17 of the Company's 1999 Annual Report to Stockholders (the "1999 Annual Report"), included as part of Exhibit 13 to this Form 10-K and incorporated herein by reference.
Unitrin Direct leases facilities with an aggregate square footage of approximately 93,000 at 6 locations in 3 states. The latest expiration date of the existing leases is in August 2008.
Fireside occupies 34 leased facilities with an aggregate square footage of approximately 165,000 in 6 states (including consumer finance branches and main office buildings). The latest expiration date of the existing leases is in March 2009.
Selected consolidated financial data for the five years ended December 31, 2003 is incorporated herein by reference to the data captioned “Financial Highlights” and filed as Exhibit 13.3 hereto.
CNA Plaza, owned by Continental Assurance Company, serves as the home office for CNAF and its insurance subsidiaries. An adjacent building (located at 55 E. Jackson Blvd.), jointly owned by Continental Casualty Company and Continental Assurance Company, is partially situated on grounds under leases expiring in 2058. Approximately 40% of the adjacent building is rented to non-affiliates. CNAF's subsidiaries lease office space in various cities throughout the United States and in other countries. The following table sets forth certain information with respect to the principal office buildings owned or leased by CNAF's subsidiaries:
Amortization of DAC related to operations was $22.9 million, $19.0 million and $10.7 million for the years ended December 31, 2003, 2002 and 2001, respectively. The increase in current year amortization expense resulted primarily from the emergence of gross profits from business sold in recent years and the acceleration of DAC amortization due to DAC unlocking. Future expected amortization of DAC, assuming no new business after December 31, 2003 and current assumptions, is as follows (in thousands):
A $3.0 million valuation allowance has been provided on certain operating loss carryforwards in Health Services at December 31, 2003. We reached this conclusion after considering the availability of taxable income in prior carryback years, tax planning strategies, and the likelihood of future taxable income exclusive of reversing temporary differences and
Net loss from discontinued operations for 2003 was $.3 million, due to our settling a purchase price adjustment on the sale of our International Operations.
During 2003, call option gains increased by $22.0 million to $12.0 million.
During 2003, operating income - affiliated increased $.6 million or 12%, to $5.5 million due to increased rental income.
During 2002, interest income - affiliated decreased $.7 million or 27%, to 1.8 million. The decline in interest income resulted from the decline in the prime rate.
The following are the characteristics of our mortgage payable, promissory note, notes payable and trust preferred securities, including estimated required payments in 2004.
interest payments required in 2004 based on current balances will be $.5 million;
note may be prepaid on or before January 2005 at 105% and declining to 101% after December 2008.
Our profitability and ability to conduct business through our health subsidiary could be negatively impacted by a change in our relationships with our largest institutional clients.
Annually, during the third quarter, we perform a comprehensive review of the assumptions used in estimating gross profits for future periods. Over the last several years, the Company’s most significant assumption updates resulting in a change to expected future gross profits and the amortization of DAC and DSI have been related to lapse experience and other contractholder behavior assumptions, mortality, and revisions to expected future rates of returns on investments. These assumptions may also cause potential significant variability in amortization expenses in the future. The impact on our results of operations of changes in these assumptions can be offsetting and we are unable to predict their movement or offsetting impact over time.
The weighted average rate of return assumptions for these businesses consider many factors specific to each business, including asset durations, asset allocations and other factors. We generally update the near term equity rates of return and our estimate of total gross profits each quarter to reflect the result of the reversion to the mean approach, which assumes a convergence to the long-term equity expected rates of return. These market performance related adjustments to our estimate of total gross profits result in cumulative adjustments to prior amortization, reflecting the application of the new required rate of amortization to all prior periods’ gross profits.
On September 19, 2013, the Financial Stability Oversight Council made a final determination that Prudential Financial is a “Designated Financial Company” under the Dodd-Frank Act. As a Designated Financial Company, Prudential Financial is now subject to supervision and examination by the Federal Reserve Bank of Boston and to stricter prudential regulatory standards, which include or will include requirements and limitations (some of which are the subject of ongoing rule-making) relating to risk-based capital, leverage, liquidity, stress-testing, overall risk management, resolution plans, early remediation; and may also include additional standards regarding capital, public disclosure, short-term debt limits, and other related subjects. In addition, on July 18, 2013, the Financial Stability Board, consisting of representatives of national financial authorities of the G20 nations, identified Prudential Financial as a global systemically important insurer. See “-Executive Summary-Regulatory Developments” above, as well as “Business-Regulation” and “Risk Factors” for information on these recent actions and their impact.
Specialty Product Revenue. These revenues consist primarily of workers' compensation premiums. Premiums are calculated by formula such that the premium written is earned pro rata over the term of the policy. Also included in specialty product revenues are administrative services and certain ancillary product revenues. Such revenues are recognized in the period in which the service is performed or the period that coverage for services is provided. Premiums written in excess of premiums earned are recorded as an unearned premium revenue liability. Premiums earned include an estimate for earned but unbilled premiums.
CII also has reinsurance treaties in effect. The reinsurers have assumed the liability on that portion of workers' compensation claims between $350,000 and $60,000,000 per occurrence for 1997 and 1996 and between $250,000 and $60,000,000 per occurrence for 1995. At December 31, 1997 and 1996, the amount of reinsurance recoverable for unpaid losses and loss adjustment expense was $21,056,000 and $15,676,000, respectively. The amount of reinsurance receivable for paid losses and loss adjustment expense was $358,000 and $103,000, respectively.
In addition, in 1995 the shareholders of the Company approved the 1995 Non-Employee Directors' Stock Plan ("Directors' Plan"). Under the Directors' Plan non-employee directors are granted an option to purchase 3,000 shares of common stock. Options are granted annually on January 20 at the current fair market value and become exercisable over a five-year period. The Company reserved 60,000 shares under the Directors' Plan.
The decrease in revenue for the year ended December 31, 2014 was offset by decreased loss and LAE of $51.3 million as compared to the same period of 2013. During the twelve months ended December 31, 2014 we recorded $5.2 million of favorable prior year loss development. During the twelve months ended December 31, 2013 we recorded $10.0 million of unfavorable prior year loss development. The decrease in loss and LAE occurred despite a $4.8 million increase in net catastrophe losses to $15.0 million during the year ended December 31, 2014 from $10.2 million reported for the same period of 2013. Other operating expenses also decreased due mostly to decreased production related expenses in our Specialty Commercial Segment and Personal Segment, partially offset by $3.0 million of costs related to higher salary and related expenses due mostly to increased incentive compensation accruals compared to the prior period, $0.7 million of CEO transition costs and $0.2 million of costs related to a previously announced public debt offering.
The $229.7 million of total revenue for the year ended December 31, 2013 was $50.8 million higher than the $178.9 million reported for 2012. This 28% increase in revenue was due to higher net premiums earned of $49.7 million due predominately to increased production discussed above. Further contributing to this increased revenue was higher net investment income of $1.6 million partially offset by lower profit share commission revenue adjustment of $0.5 million for the year ended December 31, 2013 as compared to the same period of 2012.
In connection with the entry into the White Eagle Amendment, events of default were changed to include, among other things, a failure in cash interest coverage ratio at the Company level of 1.75:1 after June 30, 2019 for 60 consecutive days. There is no interest coverage ratio requirement that would result in an event of default prior to this date; however, any failure to maintain a cash interest coverage ratio of at least 2.0:1 does impact the cash flow sweep percentage for proceeds distributed through the waterfall. As of December 31, 2016, the cash interest coverage ratio was 1.65:1. The White Eagle Revolving Credit Facility also contains certain covenants relating to asset maintenance, performance and valuation, the satisfaction of which will be determined by the lenders with a high degree of discretion.
Of the interest expense of $16.2 million for the year ended December 31, 2014, approximately $8.0 million represents interest paid on the White Eagle Revolving Credit Facility. Interest expense on the Convertible Notes totaled $7.5 million including $5.2 million, $2.0 million and $332,000 representing interest, amortization of debt discount and issuance costs, respectively. The Company recorded $694,000 of interest expense on the 12.875% Senior Secured Notes, including $592,000, $36,000, and $66,000 from interest, amortizing debt discounts and issuance costs, respectively, during the year ended December 31, 2014.
As amended on December 29, 2016, White Eagle is the borrower under a $370.0 million revolving credit facility, with Imperial Finance and Trading, LLC, as the initial servicer, the initial portfolio manager and guarantor, Lamington Road Bermuda Ltd., as portfolio manager, LNV Corporation, as initial lender, the other financial institutions party thereto as lenders, and CLMG Corp., as administrative agent for the lenders.
At December 31, 2016, there were no off-balance sheet arrangements between us and any other entity that have, or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to shareholders.
The consolidated financial statements include the estimated liability for unpaid losses and loss adjustment expenses (LAE) of CCS. The liabilities for losses and LAE's are determined using case-basis evaluations and statistical projections and represent estimates of the ultimate net cost of all unpaid losses and LAE's incurred through the end of the period. These estimates are subject to the effect of trends in future claim severity and frequency. These estimates are continually reviewed and, as experience develops and new information becomes known, the liability is adjusted as necessary; such adjustments, if any, are included in current operations.
The following table provides a reconciliation of the beginning and ending liability balances, net of reinsurance recoverable, for 2002, 2001 and 2000 to the gross amounts reported in the Company's balance sheets:
01 There are no reportable disclosures concerning ABS informational and computational material.
(e) Business Experience (1) Background Although this item requested that employment information be disclosed for each executive for a period of the prior five years along with executive's employment experience with this Registrant for a period of the prior five years, this Registrant has existed for three years
(3) There are no reportable disclosures to be made concerning material changes to the procedures by which security holders may recommend nominees to the registrant's Board of Directors, where those changes were implemented after the initial response was made to Title 17 229.407(c)(2)(iv) in a previous filing.
#(The summary table above is provided pursuant to Title 17 229.407(n)(2)
In our assessment of the books and records of this Registrant Spence-Lingo & Company and subsidiaries as of October 31, 2009 and including fiscal year ending October 31, 2008 our findings are that Spence-Lingo & Control presented in a comprehensive and accurate manner all material aspects of the financial standing of this Registrant as is reflected in the incorporated financial statements in this document in entirety elsewhere and listed by reference in Item 15 as: Balance Sheet - Year ended October 2009, Statement of Retained Earnings - Year ended October 2009, Statement of Cash Flow - Year ended October 2009, Income Statement - Year ended October 2009, Quarterly Earnings Statement - Year ended October 2009. Our audit found that these statements did not reflect accurate book keeping for periods before November 1, 2007.
As an increasing percentage of the world population reaches retirement age, we believe we will benefit from increased demand for living products rather than death products, as aging consumers will require cash accumulation to provide expenses to meet their lifetime needs. Our ordinary life products are designed for our policyowners to accumulate cash values to provide for living expenses in a policy owner’s later years, while continuously providing a death benefit.
Policyholder Dividends. Policyholder dividends increased 7.2% during 2008 to $6.9 million from $6.4 million in 2007 and $5.4 million in 2006, due to improved persistency and the continued sale of participating ordinary whole life products in the international market. All of our international policies are participating, and the improvement in persistency and increase in new business on our international business have contributed to the growth in dividends. Policyholder dividends are factored into the premiums and have no impact on profitability.
State insurance statutes prescribe the quality and percentage of the various types of investments that may be made by insurance companies and generally permit investment in qualified state, municipal, federal and foreign government obligations, high quality corporate bonds, preferred and common stock, real estate, mortgage loans and real estate within certain specified percentages.
We believe that we have established appropriate reinsurance coverage based upon our net retained insured liabilities compared to our surplus.
Premiums and policy fees $ 23,045,858 $ 25,559,708 $ 30,938,609 Reinsurance premiums and policy fees (3,556,172) (3,978,565) (4,542,532) Net investment income 16,085,833 14,529,537 15,042,287 Realized investment losses, net (260,078) (530,894) (1,119,156) Other income 431,682 477,325 566,192 ------------- ------------- ------------- 35,747,123 36,057,111 40,885,400
2001 $ 4,775,000 $ 6,351,000 $ 1,576,000 2002 4,571,000 6,086,000 1,515,000 2003 4,371,000 6,066,000 1,695,000 2004 4,140,000 6,034,000 1,894,000 2005 3,875,000 6,084,000 2,209,000
The Company reimbursed expenses incurred by Mr. Correll and Mr. Attkisson relating to travel and other costs incurred on behalf of or relating to the Company. The Company paid $96,599, $39,336 and $0 in 2000, 1999 and 1998,respectively to First Southern Bancorp, Inc. in reimbursement of such costs.
10. CAPITAL STOCK TRANSACTIONS A. STOCK OPTION PLANS UII had a stock option plan, which was assumed by UTG through the merger with UII, under which certain directors, officers and employees may be issued options to purchase up to 31,500 shares of common stock at $13.07 per share. Options become exercisable at 25% annually beginning one year after date of grant and expire generally in five years. At the September 21, 1999 board meeting, the Directors of UTG voted to discontinue this stock option plan, leaving options for 20,576 shares ungranted and therefore ultimately forfeited. At December 31, 2000, all previously granted options have expired, ending this stock option plan. No stock options were granted, exercised or exercisable through the years ended December 31, 2000, 1999, and 1998, respectively.
B. DEFERRED COMPENSATION PLAN UTG and FCC established a deferred compensation plan during 1993 pursuant to which an officer or agent of FCC or affiliates of UTG, could defer a portion of their income over the next two and one-half years in return for a deferred compensation payment payable at the end of seven years in the amount equal to the total income deferred plus interest at a rate of approximately 8.5% per annum and a stock option to purchase shares of common stock of UTG. At the beginning of the deferral period an officer or agent received an immediately exercisable option to purchase 2,300 shares of UTG common stock at $17.50 per share for each $25,000 ($10,000 per year for two and one-half years) of total income deferred. The option expired on December 31, 2000. A total of 105,000 options were granted in 1993 under this plan. At December 31, 2000, all previously granted options have expired, ending the stock options available through this plan. During 2000, the Company paid deferred compensation owed totaling $1,166,400. At December 31, 2000 and December 31, 1999, the Company held a liability of $116,999 and $1,283,399, respectively, relating to this plan.
The decrease in Premium Income from Sfrs. 374,967,135 to Sfrs. 344,388,191 is mainly due to the adjustment of exchange rates on numerous currencies in line with recent develop­ ments, and in part also to a drop in marine insurance premiums owing to the further re­ duction of commercial transports.
The Company's cash and cash equivalents increased by $46.5 million to $103.6 million at December 31, 1996, from $57.0 million at December 31, 1995. At December 31, 1996, the Company had working capital of $76.5 million. The primary source of cash received during the year ended December 31, 1996, was operations.
SIERRA HEALTH SERVICES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY For the Years Ended December 31, 1996, 1995 and 1994
Of the cash and cash equivalents that total $103,587,000 in the accompanying Consolidated Balance Sheet at December 31, 1996, $85,187,000 is limited for use only by the Company's regulated subsidiaries. Such amounts are available for transfer to Sierra from the regulated subsidiaries only to the extent that they can be remitted in accordance with terms of existing management agreements and by dividends which customarily must be approved by regulating state insurance departments. The remainder is available to Sierra on an unrestricted basis.
Total insurance revenues, consisting of premiums and policy charges and fee income increased $.1 million for the year ended December 31, 1998 to $57.6 million from $57.5 million for the year ended December 31, 1997. This increase in insurance revenues is primarily attributable to an increase in sales of Discovery Select, a variable annuity retirement type product. This has proven to be a successful product of the Company's portfolio since its introduction in January 1997. However, these gains were offset by a decline in the number of traditional life insurance policies in force in 1998 compared to 1997.
Policyholders' benefits increased $5.3 million for the year ended December 31, 1997 to $34.0 million from $28.7 million for the year ended December 31, 1996. This increase is attributable to an increase in mortality costs associated with the aging book of business.
On September 22, 1994, Capsure, through its wholly owned subsidiary, CFG, acquired all of the outstanding common stock of Universal Surety Holding Corp. ("USHC"). USHC is the holding company of Universal Surety. Capsure paid $28 million in cash and $4 million in Capsure stock for USHC, pursuant to a Stock Purchase Agreement dated as of July 26, 1994. The cash portion of the purchase price was financed with borrowings under Capsure's $135 million Credit Facility.
The Internal Revenue Service has not examined the Company's tax returns for the years in which the Company reported net operating losses. Under Section 382 of the Internal Revenue Code, certain restrictions on the utilization of NOLs will apply if there is an ownership change of a corporation entitled to use such carryovers. The Company believes that there is currently no restriction on the ability of the Company to utilize its NOLs. It is possible that future transactions involving the common stock or rights to acquire such stock could cause an ownership change of the Company resulting in restrictions of the Company's ability to utilize the NOLs during all taxable periods after the date of such ownership change. The Company has adopted provisions in its Certificate of Incorporation designed to facilitate the Company's ability to preserve and utilize its NOLs.
The operational results, also known as the underwriting results, of an insurance or reinsurance company are discussed frequently by reference to its claims and claim expense ratio, underwriting expense ratio, and combined ratio. The claims and claim expense ratio is the result of dividing claims and claim expenses incurred by net premiums earned. The underwriting expense ratio is the result of dividing underwriting expenses (acquisition expenses and operational expenses) by net premiums earned. The combined ratio is the sum of the claims and claim expense ratio and the underwriting expense ratio. A combined ratio below 100% generally indicates profitable underwriting prior to the consideration of investment income. A combined ratio over 100% generally indicates unprofitable underwriting prior to the consideration of investment income.
For our property catastrophe reinsurance operations, we initially set our claims reserves based on case reserves and other reserve estimates reported by insureds and ceding companies. We then add to these case reserves, our estimates for additional case reserves, and an estimate for incurred but not reported reserves ("IBNR"). These estimates are generally based upon our experience with similar claims, our knowledge of potential industry loss levels for each loss, and industry information which we gather and retain in our REMS(C) modeling system. The estimation of claims resulting from catastrophic events is inherently difficult because of the variability and uncertainty associated with property catastrophe claims. During 2003, with the accumulation of ten years of historical information on our claims and claim expenses, we adopted a new system to reassess our property catastrophe reserves on our older accident years.
Although prices in the property insurance and reinsurance markets are beginning to decline, and the rate of increase in prices of the casualty insurance and reinsurance markets are also beginning to decline, we believe that the principal components of our operations continue to display strong fundamentals. (see Item 1. Business - "Industry Trends" for additional commentary about the overallc market environment.) We currently anticipate the following developments in our business:
In January 2012, we acquired a controlling interest in a health clinic in Puerto Rico, as part of our strategic approach in our Managed Care segment.
On November 7, 2013, we completed the acquisition of 100% of the outstanding shares of capital stock of ASICO for an aggregate purchase price of approximately $4.8 million, net of $4.6 million of cash acquired.
In October 2014 the Company’s Board of Directors authorized a $50.0 million repurchase program of our Class B common stock. Repurchases were conducted through open-market purchases of Class B shares only, in accordance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended. During 2014, the Company repurchased and retired 228,525 shares of our Class B Common Stock at an average per share price of $23.55, for an aggregate cost of $5.4 million.
At December 31, 2014, claim liabilities for the managed care segment amounted to $248.9 million and represented 63.8% of our total consolidated claim liabilities and 19.3% of our total consolidated liabilities.
The Company invests part of its excess cash in equity securities, money market funds and government bonds. Such investments are included in “Marketable securities” in the accompanying consolidated balance sheets. Held-to-maturity represents debt securities the Company intends and has the ability to hold to maturity; Trading securities represent debt securities bought and held primarily for sale in the near-term to generate income on short-term price differences; Equity security investments are classified as trading securities and reported at FV with changes in FV recorded in “Other Income”. Available-for-sale represents debt securities not classified as held-to-maturity or trading securities; Bonds are classified as available-for-sale and reported at FV with unrealized gains and losses included in “Accumulated other comprehensive income (loss).”
A summary of AHFL’s assets and liabilities acquired as of the dates of acquisition is presented below:
The geographical distribution of China United’s revenue for the years ended June 30, 2013 and 2012 is as follows:
Fees and other income decreased by $1, or less than 1%, from $306 for the year ended December 31, 2003, to $305 for the year ended December 31, 2004. The decrease is driven by lower administrative services only sales.
Income taxes increased $125, or 3%, from $4,507 for the year ended December 31, 2003, to $4,632 for the year ended December 31, 2004. The increase is primarily due to an increase in pre-tax income. In addition, during the fourth quarter of 2004, an analysis of the federal tax liability resulted in a $1,000 reduction of our tax liability.
In addition to the regulatory oversight of NAICO, Chandler Insurance is also subject to regulation under the laws of the Cayman Islands and Chandler USA and all of its affiliates are also subject to regulation under the Nebraska Insurance Holding Company System Act (the "Holding Company Act"). The Holding Company Act contains certain reporting requirements including those requiring Chandler Insurance, as the ultimate parent company, to file information relating to its capital structure, ownership and financial condition and general business operations of its insurance subsidiaries. The Holding Company Act contains special reporting and prior approval requirements with respect to transactions among affiliates. The Holding Company Act also imposes certain requirements upon any person controlling or seeking to control an insurance company domiciled in Nebraska. Control is generally presumed to exist if any person, directly or indirectly, owns, controls, holds with the power to vote or holds proxies representing 10% or more of the voting securities of the insurance company or of any other person or entity controlling the insurance company. The 10% presumption is not conclusive and control may be found to exist at less than 10%. Persons owning any securities of Chandler USA or Chandler Insurance must comply with the Holding Company Act. See "BUSINESS - Regulation."
L&W's brokerage commissions and fees before intercompany eliminations were $9.0 million in 1997, $8.5 million in 1998 and $9.6 million in 1999. A large portion of the brokerage commissions and fees for L&W is incurred by NAICO and thus eliminated in the consolidation of Chandler USA's subsidiaries.
Fees generated by Network Administrators, Inc. ("Network"), a wholly owned subsidiary of Chandler USA, were $435,000 in 1997. Network no longer functions as a third-party administrator.
Cost of Outsourcing Services. Cost of outsourcing services decreased 1.8% to $36.8 million in 2000 from $37.4 million in 1999. As a percentage of outsourcing services revenues, however, cost of outsourcing services increased to 80.1% in 2000 from 71.7% for the corresponding period in 1999 primarily as a result of the decrease in the dollar amount of outsourcing services revenues in 2000 as compared to 1999. The decrease in the dollar amount of cost of outsourcing services was primarily attributable to a decrease in revenue from the Company's claims catastrophe subsidiary, which pays approximately 70% of each dollar of revenue received to the independent adjusters who adjust the claims on such subsidiary's behalf. The decrease in the dollar amount of expenses from the Company's claims catastrophe subsidiary was partially offset by (i) increases in the Company's personnel costs due to staff additions and the use of contract programmers to develop and staff new unaffiliated programs and (ii) an increase in facilities costs due to the occupancy of the Company's new operating and call center facility.
The operating strategy of the Company's management emphasizes several key objectives: expense management; marketing of competitively priced insurance products which are designed to generate an acceptable level of profitability; maintenance of a high quality portfolio of investment grade securities; and the provision of quality customer service.
In 1995, Investors-NA entered into a reinsurance agreement with Family Life Insurance Company (an insurance company subsidiary of Financial Industries Corporation and an affiliated company of Investors-NA), pertaining to universal life insurance written by Family Life. The reinsurance agreement is on a co-insurance basis and applies to all covered business with effective dates on and after January 1, 1995. The agreement applies to only that portion of the face amount of the policy which is less than $200,000; face amounts of $200,000 or more are reinsured by Family Life with a third party reinsurer. The arrangement reflects management's plan to develop universal life business at Investors-NA, with Family Life concentrating on the writing of term life insurance products.
Total assets as of December 31, 1995 ($1.32 billion) increased from the level as of December 31, 1994 ($1.15 billion). The increase in total assets is primarily attributable to (a) the inclusion of Investors-IN and (ii) an increase in the amount of separate account assets.
The Company's net income, net of federal income taxes, was $10,714,000, or $ 2.11 per common share for the year 1995, as compared to $9,917,000, or $1.93 per common share for the year 1994 For the year 1993, net income, net of federal income taxes, extraordinary items and cumulative effect of change in accounting principle, was $3,347,000, or $.69 per common share. Net income per common share in 1995 was affected by a slight increase in the number of common stock and common stock equivalents which were required to be taken into account in determining net income per share. For the year ended December 31, 1995, the amount of common stock and common stock equivalents was 5,389,000, as compared to 5,378,000 in 1994 and 5,858,000 in 1993.
As a result of the factors described above, the Company reported a net loss of $1,952,000 in 2000 compared to net income of $2,151,000 in 1999 and $3,442,000 in 1998. Net litigation expenses related to legal proceedings involving the CenTra Group reduced net income by $630,000 in 2000 and $1.1 million in 1999 compared to an increase of $2.9 million in 1998.
During the year, total liabilities increased by $377 million from $2,926 million to $3,303 million. Corresponding with the asset change, separate account liabilities increased by $187 million from $1,926 million in 2003, as described above. Policyholders' account balances increased by $121 million, from $676 million in 2003, primarily due to positive net sales and the reclassification of MVA contracts as described above. Future policy benefits increased by $31 million, from $159 million in 2003, as a result of growth in the term insurance business and the establishment of guaranteed minimum death benefit, or GMDB, and guaranteed minimum income benefit, or GMIB, reserves. Income taxes payable, net of receivables, increased by $25 million mainly as a result of tax expense and a tax refund received from Prudential Financial. In accordance with the tax sharing agreement with Prudential Financial, the Company was reimbursed for operating losses utilized in the consolidated federal tax return.
The information required by this Item is incorporated by reference from portions of The PMI Group, Inc. 1997 Annual Report to Shareholders under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations" as part of Exhibit 13.1.
BI claims closed in the accident year reported are generally the smaller and less complex claims that settle for approximately $3,500 to $4,000, on average, whereas the total average settlement, once all claims are closed in a particular accident year, is approximately $10,000 to $12,000. The Company creates incurred and paid loss triangles to estimate ultimate losses utilizing historical payment and reserving patterns and evaluates the results of this analysis against its frequency and severity analysis to establish BI loss reserves. The Company adjusts development factors to account for inflation trends it sees in loss severity. As a larger proportion of claims from an accident year are settled, there emerges a higher degree of certainty for the loss reserves established for that accident year. Consequently, there is generally a decreasing likelihood of loss reserve development on any particular accident year, as those periods age. At December 31, 2016, the accident years that are most likely to develop are the 2014 through 2016 accident years; however, it is possible that older accident years could develop as well.
Consolidated Statements of Shareholders’ Equity for the Years Ended December 31, 2016, 2015, and 2014
receivables and accounts payable approximate their fair values. All investments are carried at fair value on the consolidated balance sheets.
U.S. government bonds and agencies/Short-term bonds: Valued using unadjusted quoted market prices for identical assets in active markets.
Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial reporting basis and the respective tax basis of the Company’s assets and liabilities, and expected benefits of utilizing net operating loss, capital loss, and tax-credit carryforwards. The ultimate realization of deferred tax assets is dependent upon generating sufficient taxable income of the appropriate character within the carryback and carryforward periods available under the tax law. Management considers the reversal of deferred tax liabilities, projected future taxable income of an appropriate nature, and tax-planing strategies in making this assessment. The Company believes that through the use of prudent tax planning strategies and the generation of capital gains, sufficient income will be realized in order to maximize the full benefits of its deferred tax assets.
The information about incurred and paid claims development for the years ended December 31, 2007 to 2015 is presented as unaudited supplementary information.
Cash flow generated from (absorbed by) operations for 1995, 1994 and 1993 was $(16.7) million, $(8.9), and $7.2 million, respectively. Cash from all Company operations has been adequate to meet obligations and, at this time, is believed by management to be adequate for the foreseeable future. See "Item 3. Legal Proceedings" and "Note I" to the Consolidated Financial Statements".
RETAIL. Retail's principal products are standard automobile, non-standard automobile, homeowners and small business owner's insurance. Automobile policies cover liability to third parties for bodily injury and property damage and physical damage to the insured's own vehicle resulting from collision or various other causes of loss. Homeowners and small commercial property policies protect against loss of dwellings/buildings and contents arising from a variety of perils, as well as liability arising from ownership or occupancy. Retail's products are distributed through approximately 630 independent agents. Net premium written for the Retail division comprised 24%, 22%, and 19% of consolidated net premium written for the years ended December 31, 1996, 1995 and 1994, respectively.
THE 1996 NON-EMPLOYEE DIRECTORS COMPENSATION PROGRAM. The 1996 Non-Employee Directors Compensation Program (the "1996 Program") provides for awards of stock options and/or restricted
THE 1993 LONG-TERM INCENTIVE PLAN. The 1993 Long-Term Incentive Plan (the "1993 Plan") provides for awards of stock options, stock appreciation rights, restricted stock grants and/or performance units (collectively referred to as "awards"). These awards are not to exceed 15 million shares in the aggregate. As of December 31, 1996, there were no stock appreciation rights or performance units outstanding. The 1993 Plan terminated May 2, 1996, except with respect to outstanding awards, with the approval of the 1996 Plan. Stock options under the 1993 Plan have a term of ten years from the date of grant and vest in equal annual installments over four years. Restricted stock grants vest in equal annual installments over three years.
A summary of the components of net periodic other postretirement benefit cost is as follows:
Net investment income for 1999 was $10.5 million, a 13.5% increase over $9.3 million in 1998. This increase in investment income was the result of growth in the average book value of invested assets by $32.3 million to $184.0 million for the year ended December 31, 1999, from $151.7 million for 1998. The growth in invested assets was attributable to normal operating cash flow. The pre-tax yield on average invested assets declined to 5.7% for 1999 as compared to 6.1% for all of 1998, reflecting the Company's investment strategy to emphasize tax-preferred securities which yield lower pre-tax rates than similar fully taxable securities. The portfolio's tax-equivalent yield was 7.7% for 1999 versus 7.9% for 1998. Approximately 71% or $124.4 million of the Company's fixed maturity portfolio at December 31, 1999, was composed of state and municipal tax-preferred securities as compared to approximately 70% or $107.5 million at December 31, 1998.
The expense ratio (ratio of underwriting expenses to net premiums written) for 1999 was 34.5% compared to 35.4% for 1998. Contributing to this improvement was the higher level of written premiums in 1999 partially offset by the increase in expenses.
The effective tax rate for 1999 and 1998 was 30.5%. This effective rate reflected the Company's continued investments in tax-preferred securities.