felanders/preprocessed huggingface dataset:
We took write downs on certain other investments that we concluded did have an other than temporary impairment during 2005, 2004 and 2003 of $9.5 million, $12.8 million and $9.8 million, respectively. Following is a discussion of each security for which we have taken write downs during the years ended December 31, 2005, 2004 and 2003.
Ford Motor Co. was determined to be an improving credit, however we decided to reduce our position in this security during 2003 to $10.0 million by selling $5.0 million principal amount of these securities at a loss of $0.4 million.
of the Company, rather than an “implicit variable interest” under FSP FIN 46(R)-5. Prior to the acquisition, we had an implicit variable interest in the Service Company and we consolidated the Service Company under FSP FIN 46(R)-5 upon its adoption by us in the first quarter of 2005. As permitted by the FSP, we applied FSP FIN 46(R)-5 retroactive to January 1, 2003, the date of our original adoption of FIN 46. The consolidation of the Service Company reduced net income by $3.2 million for the year ended December 31, 2005. This amount was principally due to a $2.5 million distribution to the former shareholder of the Service Company prior to the September 2, 2005 acquisition and adjustments to the Service Company’s income tax liabilities as a result of a change in its effective income tax rate upon becoming a wholly-owned subsidiary of the Company. The adoption of FSP FIN 46(R)-5 and consolidation of the Service Company as an “implicit variable interest”resulted in an increase in income tax expense of $16.3 million during 2004 due to a change in the federal income tax status of the Service Company.
We may redeem the notes at any time on or after December 15, 2011. The holders of the notes may require us to repurchase their notes on December 15, 2011, 2014, and 2019 and for a certain period of time following a change in control. The redemption price or the repurchase price shall be payable in cash and equal to 100% of the principal amount of the notes, plus accrued and unpaid interest (including contingent interest and liquidated damages, if any) up to but not including the date of redemption or repurchase.
During 2005 and 2004, we issued 19,500 shares and 54,385 shares, respectively, of our common stock to an agent’s beneficiaries in relation to shares earned under the American Equity Investment NMO Deferred Compensation Plan. See note 10 to our audited consolidated financial statements.
Through March 31, 2016, the Company reinsured the majority of its variable annuity living benefit guarantees to its affiliated companies, Pruco Re and Prudential Insurance, in order to facilitate the capital markets hedging program for these living benefit guarantees. Effective April 1, 2016, the Company recaptured the risks related to its variable annuity optional living benefit guarantees that were previously reinsured to Pruco Re and Prudential Insurance. In addition, the Company reinsured the variable annuity base contracts, along with the optional living benefit guarantees, from Pruco Life. The reinsurance agreement covers new and in force business and excludes business reinsured externally by Pruco Life. The product risks related to the reinsured business are being managed in the Company. These series of transactions are collectively referred to as the "Variable Annuities Recapture". After the foregoing transactions, Pruco Re no longer had any material active reinsurance with affiliates. On September 30, 2016, Pruco Re was merged with and into PALAC.
of changes in our future rate of return on the DAC and DSI balances and not changes in any other assumptions such as persistency, mortality or expenses included in our evaluation of DAC and DSI. Further, this information does not reflect changes in reserves, such as the reserves for the guaranteed minimum death and optional living benefit features of our variable annuity products, or the impact that changes in such reserves may have on the DAC and DSI balances.
Other liabilities increased $0.4 billion primarily due to the deferred reinsurance gain recognized from the Variable Annuities Recapture.
Loss from operations before income taxes increased $2.0 billion from income of $0.2 billion for the year ended 2015, to a loss of $1.8 billion for the year ended 2016.
NET INVESTMENT INCOME. Net investment income increased 1.6% to $9.7 million for 1999 from $9.5 million for 1998. Average invested assets increased to $160.8 million for 1999 from $156.9 million for 1998. The Company's average yield on its portfolio was 6.0% in 1999 and 6.1% in 1998.
EQUITY IN NET LOSS OF UNCONSOLIDATED AFFILIATE. The equity in net loss of unconsolidated affiliate in 1999 represents the Company's share of the net loss of Montlake. The Company is accounting for this investment using the equity method.
INCOME TAXES. Income tax benefit for 1999 was $7.5 million compared to $3.8 million for 1998. The effective combined income tax rates for 1999 and 1998 were (35.3%) and (44.0%), respectively. The difference in the effective tax rates is due to a repositioning of the investment portfolio from tax exempt securities to taxable securities in the third quarter of 1998.
At December 31, 1999 and 1998, the entire investment portfolio is classified as available-for-sale and is reflected at estimated fair value with unrealized gains and losses recorded as a separate component of stockholders' equity, net of related deferred income taxes. The premium and discount on fixed maturities and collateralized mortgage obligations are amortized using the interest method. Amortization and accretion of premiums and discounts on collateralized mortgage obligations are adjusted for principal paydowns and changes in expected maturities. Investments in which the decline in market value is deemed other than temporary are reduced to the estimated realizable value through a charge to income.
Twelve months ended December 31, 2010 ("Fiscal 2010" or "2010" or "the current year") compared to twelve months ended December 31, 2009 ("Fiscal 2009" or "2009" or "the prior year").
LOSS FROM OPERATIONS. We had an operating loss of ($168,337) for fiscal year 2010 as compared to an operating loss of ($30,237) for fiscal 2009, primarily due to decreased revenues partially offset by lower operating expenses as described above..
These Agreements usually require us to pay penalties for any time delay in filing the required registration statements, or in the registration statements becoming effective, beyond dates specified in the Agreement. These penalties are usually expressed as a fixed percentage, per month, of the original amount the Company received on issuance of the debt or preferred stock, common shares, options or warrants. The Company accounts for these penalties when it is probable that a penalty will be incurred. At December 31, 2010, the Company has no registration rights agreement requiring penalties to be recorded.
For the year ending December 31, 2010, a director and officer of the company, had received $100,000 in compensation, which was deferred.
During the last two years, BHRG wrote a significant amount of business under traditional multi-line contracts. Such contracts included several quota-share participations in, and contracts with, Lloyd’s syndicates and a quota-share contract written in 2002 with a major U.S. based insurer, which was cancelled in 2003. These contracts and participations generated written premiums of about $1.6 billion in 2003 and $2.0 billion in 2002. In a quota-
Revenues of the finance group consist of interest, rentals, and sales of manufactured homes, transportation equipment and furniture. Revenues in 2003 totaled $3,073 million, an increase of 37.6% over 2002. The increase in 2003 was primarily due to the inclusion of Clayton (approximately $500 million), revenues from the issuance of annuity products of approximately $700 million versus none in 2002 and was partially offset by lower interest income.
During 2003 and 2002, Berkshire entered into a significant number and amount of foreign currency forward contracts. Generally, these contracts provide that Berkshire receive certain foreign currencies and pay U.S. dollars at specified exchange rates and at specified future dates. Management entered into these contracts as an overall economic hedge of Berkshire’s net assets and business activities. The value of these contracts is subject to change due primarily to changes in the spot exchange rates and to a lesser degree, interest rates and time value. The
Certain costs of acquiring insurance premiums are deferred, subject to ultimate recoverability, and charged to income as the premiums are earned. Acquisition costs consist of commissions, premium taxes, advertising and other underwriting costs. The recoverability of premium acquisition costs, generally, reflects anticipation of investment income. The unamortized balances of deferred premium acquisition costs are included in other assets and were $1,278 million and $1,303 million at December 31, 2003 and 2002, respectively.
The Company’s management has identified the following as major financial, operational and marketing accomplishments during 2005:
earning an operating profit for all segments (see page 27 of this Management Discussion and Analysis of Financial Condition and Results of Operation and Note 7 to the Consolidated Financial Statements for a discussion of statutory accounting)
Summary of important figures in millions of francs Swiss Re, Zurich 1976/77 1975/76
Hans Ulrich St. Gall, Professor, St. Gall Graduate School of Economics, Business and Public Administration 1977 *Members of the Committee of Directors
Investment income (less interest on Life assurance and annuity fund and other technical reserves) 173,519,758 143,635,245
Surrenders 87 19 106 126 Claims on death and maturity and annuities paid 260 41 301 276
All figures from foreign Group companies were con­ verted Into Swiss francs using the average foreign currency rates as at 30th June of the following year. The exchange rates of foreign currencies used in Group accounts (U.S. dollar, Canadian dollar, Australian dollar, rand, pound sterling and German mark) were all lower than in the previous year, with the exception of the German mark (of. table on page 16). The foreign currency profit of Sw. frs. 8.9 million (pre­ vious year, loss of Sw. frs. 16.5 million) resulting from the new valuation of the opening balance-sheet figures was, as before, debited to the consolidation reserve fund.
The Company competes in the U.S. and international reinsurance and insurance markets with numerous global competitors. The Company’s competitors include independent reinsurance and insurance companies, subsidiaries or affiliates of established worldwide insurance companies, reinsurance departments of certain insurance companies and domestic and international underwriting operations, including underwriting syndicates at Lloyd’s. Some of these competitors have greater financial resources than the Company and have established long-term and continuing business relationships, which can be a significant competitive advantage. In addition, the lack of strong barriers to entry into the reinsurance business and the potential for securitization of reinsurance and insurance risks through capital markets provide additional sources of potential reinsurance and insurance capacity and competition.
The Company, through its subsidiaries, operates in four segments: U.S. Reinsurance, U.S. Insurance, Specialty Underwriting and International. The U.S. Reinsurance operation writes property and casualty, treaty and facultative reinsurance, through reinsurance brokers, as well as directly with ceding companies within the U.S. The U.S. Insurance operation writes property and casualty insurance primarily through general agents and surplus lines brokers within the U.S. The Specialty Underwriting operation writes A&H, marine, aviation and surety business within the U.S. and worldwide through brokers and directly with ceding companies. The International operation writes property and casualty reinsurance through Everest Re’s branches in Canada and Singapore, in addition to foreign business written through Everest Re’s Miami and New Jersey offices.
Underwriting (loss) gain $ (244 ) $ (63,505 ) $ 5,870
The following table shows the components of the Company’s incurred losses and LAE for 2006 and 2005:
The following table shows the International segment components of incurred losses and LAE for 2006 and 2005:
The following table shows the combined ratios for each of the Company’s operating segments in 2006 and 2005. The segment combined ratios were impacted by the loss and expense ratio variations noted above.
Annualized pre-tax yield on average cash and invested assets 4.8 % 4.4 %
The following table shows the components of the Company’s incurred losses and LAE for 2005 and 2004:
The following is a schedule at May 31, 2005 of our long-term contractual commitments, future minimum lease payments under non-cancelable operating lease arrangements and other long-term obligations:
Because providers are responsible for claims submission, the timing of which is uncertain, we must estimate the amount of claims incurred but not reported.
The holders of our Series A Shares are entitled to receive dividends when declared by our Board of Directors. The payment of these dividends will take priority over any payment of dividends on our common stock. The holders of our Series A Shares will have a claim against our assets senior to the claim of the holders of our common stock in the event of our liquidation, dissolution or winding-up. The aggregate amount of that senior claim is approximately $3.6 million as of August 1, 2005 and will increase thereafter if such preferred stock accrues dividends and if we issue additional shares of such preferred stock to Woodcliff pursuant to the terms of the Securities Purchase Agreement for the Series A Shares.
During the period January 2005 through March 2005, prior to the extension of the SFAS No. 123R compliance date, the Company issued to five employees an aggregate of 152,700 options that vested May 31, 2005, which provided such employees a shorter vesting term for their options than is normally awarded. If the options had been issued with customary vesting dates and the compliance date had not been extended, the Company would have recorded compensation expense totaling approximately $100,000 during fiscal 2006 for the options that were unvested at May 31, 2005.
Effective August 1, 2005, the Company’s principal operating subsidiary, CBC, entered into a marketing agreement with Health Alliance Network, Inc. (“HAN”) whereas CBC has agreed to appoint HAN as its primary representative and marketing agent for commercial business (see Note 17(2) - “Subsequent Events”).
For the year ended December 31, 1998, FIC's net income was $9,218,000 (basic earnings of $1.71 per common share or diluted earnings of $1.66 per common share), as compared to $16,328,000 (basic earnings of $3.01 per common share or diluted earnings of $2.92 per common share) for the year ended December 31, 1997 and $16,157,000 (basic earnings of $2.98 per common share or diluted earnings of $2.90 per common share), for the year ended December 31, 1996. Earnings per share are stated in accordance with the requirements of Financial Accounting Standard (FAS) No. 128, which establishes two measures of earnings per share: basic earnings per share and diluted earnings per share. Basic earnings per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share reflect the potential dilution that would occur if securities or other contracts to issue common stock were converted or exercised. For the year 1996, earnings per share have been restated to reflect the effect of FAS No. 128.
The decline in long-term interest rates during 1998, which was related to general economic conditions, had a positive effect upon the market value of the fixed maturities available for sale segment of the Company's portfolio. As of December 31, 1998, the market value of the fixed maturities available for sale segment was $79.4 million as compared to an amortized value of $76.73 million, or an unrealized gain $2.67 million. The net of tax effect of this increase has been recorded as an increase in shareholders' equity. There is no assurance that this unrealized gain may be realized in the future.
The systems which administer a substantial number of Family Life policies will be modified rather than converted. The modification of the PMS system (administering approximately 122,000 policies for Family Life) was completed in March, 1998. The conversion of the Cypros AP system (administering approximately 19,600 active policies for Family Life) is scheduled for completion at the end of September, 1999.
In the event that a major administrative system fails to operate properly due to the Y2K problem, or the Company does not complete the necessary systems conversions prior to January 1, 2000, the Company has developed a plan to respond to such a contingency. FIC Computer Services has assigned certain personnel to be members of an emergency response team to resolve Y2K operations problems. Additionally, insurance policies would be administered manually if the necessary systems conversions were not completed prior to January 1, 2000, or subsequent Y2K operations problems persist. Manual policy administration would require additional personnel. If substantial additional personnel become necessary for manual policy administration, the training and salary expenses of such personnel could materially affect the Company's business and results of operations. The Company is not able to estimate the likelihood that manual administration will be needed or the amount of any expense which it would incur in connection with such manual administration.
Consolidated miscellaneous income in 2000 was $9,622 as compared to $10,840 in 1999.
Cash Flows. For the year ended December 31, 2000, operating activities utilized $5.4 million of cash. The net loss adjusted for non-cash items such as depreciation, amortization, and other non-cash charges utilized $3.3 million of cash. Net increase in operating assets utilized $2.1 million of cash. Investing activities utilized $0.3 million of cash, principally consisting of capital expenditures. Financing activities provided $4.5 million of cash principally from proceeds of notes payable to affiliate.
GOODWILL - Goodwill represents the excess of the purchase price over the fair value of the net assets of acquired entities. As a result of its evaluation, and in light of the June 1999 transaction with an unrelated party, the Company wrote off in 1998 approximately $2,323,000 to reduce the remaining unamortized goodwill to its net realizable value. The remaining balance was sold as part of one of the June 1999 transactions (see GHI Transaction in Note 1).
December 31, -------------------------- 2000 1999 ------------ ------------ Computer hardware and software $ 3,461 $ 3,486 Furniture, fixtures, and equipment 1,450 1,883 ------------ ------------ Total 4,911 5,369 Less accumulated depreciation and amortization 4,271 4,613 ------------ ------------ Property and equipment, net $ 640 $ 756 ============ ============
The Company has adopted the disclosure only provisions SFAS No. 123. Accordingly, no compensation cost has been recognized for the options in the accompanying consolidated statements of operations. Had compensation cost for grants made under the Company's stock option plan and non-incentive executive stock option plan been determined based on the fair value at the grant date in a manner consistent with SFAS No. 123, the Company's pro forma net loss and pro forma net loss per share would be as follows ($ in thousands, except per share amounts):
The Risk-Based Capital ("RBC") requirements for health maintenance organizations have not been adopted by the New York legislature. However, the SNYID does require that a RBC report be filed with the SNYID for informational purposes by April 1 of each year. WCNY filed a RBC report as of December 31, 2000 on March 31, 2001. This report disclosed that WCNY did not meet the minimum RBC requirements and triggered a mandatory control level ("MCL") event, as defined in the National Association of Insurance Commissioners ("NAIC") model law for RBC. An MCL event occurred since the WCNY's total adjusted capital was below the mandatory control level. The SNYID may take regulatory action against WCNY as a result of filing this RBC report, including but not limited to placing the Company under regulatory control. As of May 25, 2001, the SNYID has not taken any action.
The Company's consolidated financials are presented on the going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.
Net loss before extraordinary gain per share (0.13) (1.02) Net loss available to common shareholders per share (0.13) (0.03)
Other risk factors discussed elsewhere within this Form 10-K for the year ended December 31, 2004.
There is an exception to the treatment noted above if and when an investment security considered to be available for sale is deemed to be other-than-temporarily impaired. An other-than-temporary impairment may occur when the market value of a security falls below its cost by a material amount for an extended period of time (generally one year but can be less under certain circumstances) or when other creditworthiness issues arise with regard to an issuer. If and when a security is deemed to be other-than-temporarily impaired it is written down to its estimated market value with a corresponding realized investment loss recognized in net income.
Claims administration and management fee revenues include management fees of the insurance management segment, which are determined by contract as a percentage of PRI’s direct premiums written for the calendar year. Such management fees are estimated, billed and earned monthly based upon the estimated or re-estimated direct premiums written of PRI for the calendar year.
(1)Data presented in this table represents consolidated information of all our insurance subsidiaries commencing from their respective dates of acquisition. Data presented from 1994 to 1997 reflects only First Professionals’ liability for losses and LAE. The 1998 year reflects losses and LAE data for First Professionals and APAC. The data presented from 1999 to 2004 reflects all of FPIC’s current insurance subsidiaries.
HRM's principal corporate offices consist currently of approximately 142,500 square feet in a building in Minneapolis, Minnesota, 31,000 square feet in Kalamazoo, Michigan and 4,000 square feet in Sacramento, California. The lease on the Minneapolis office expires in or by 2009 and the Sacramento office lease expires in or by 1999. The lease on the Kalamazoo office expires in or by 2001. The Company also leases space for four sales offices located in the United States and Canada generally for one-year terms or less. All of the Company's facilities are used exclusively by the Company for office space or computer operations and are anticipated to be adequate, but will be expanded as business needs require.
Income Taxes: Income taxes decreased in fiscal 1998 from fiscal 1997 by $545,000, or 39% (from $1,413,000 to $868,000), and increased in fiscal 1997 from fiscal 1996 by $160,000, or 13% (from $1,253,000 to $1,413,000) primarily due to fluctuations in levels of income before income taxes and cumulative effect of accounting change. Net income had been reported as fully taxed in fiscal year 1998, 1997 and 1996 at the effective tax rate of 39%. See Note 8 in the Notes to Consolidated Financial Statements.
Management is monitoring a program to prepare the Company's computer systems or software applications and external relationships for the year 2000. Utilizing a national consulting firm, the Company has completed a systematic survey of its hardware, software and facilities. A strategy for achieving compliance for each system component has been prepared. Costs of the Company's Year 2000 Project through June 30, 1999, are estimated at approximately $1.4 million of which approximately $.3 million has been incurred through June 30, 1998. The cost of the Year 2000 Project will be expensed as incurred.
The Company is in direct competition with a large number of insurance companies, many of which offer a greater number of products through a greater number of agents and have greater resources than the Company. This competitive environment could result in lower premiums, less favorable underwriting terms and conditions, loss of underwriting opportunities and reduced profitability.
Premiums from individual life, guaranteed issue and simplified issue products, and other lines are as follows (dollars in thousands):
Interest credited to universal life contracts for 2003 was flat as compared to 2002 and increased 7% in 2002 as compared to 2001 reflecting growth in universal life policy accumulations, offset by reductions to the annual interest rate credited to policyholders in 2003 and 2002. The annual interest rate credited to policyholders of universal life contracts was 5.75% for the first two months of 2003. Effective March 1, 2003, the annual rate credited to policyholders changed to 5.4%. The annual rate credited to policyholders was 5.75% for the final three months of 2002 and was 6.25% for the first nine months of 2002 and for the year 2001.
The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”), which vary in certain respects from reporting practices prescribed or permitted by the Insurance Department of the State of Georgia. The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenues and expenses during the reporting period. Amounts that the Company deems to be most sensitive to changes in estimates include deferred policy acquisition costs, future policy benefits, income taxes, and impairments as they relate to investments. In addition, the Company must determine requirements for disclosure of contingent assets and liabilities as of the date of the financial statements based upon estimates. In all instances, actual results could differ from estimates.
The Company accounts for investments under the provisions of Statement of Financial Accounting Standards (“SFAS”) No. 115, “Accounting for Certain Investments in Debt and Equity Securities.”
affect the Company’s results of operations or financial position. The Company has complied with the disclosure requirements of SFAS No. 148 in these consolidated financial statements.
We have audited the accompanying consolidated statements of earnings, shareholders’ equity, cash flows, and comprehensive income of Cotton States Life Insurance Company and subsidiaries (the “Company”) for the year ended December 31, 2001. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit.
Dividends. In June 2017, our Board increased our quarterly cash dividend to shareholders by 20% to an annual dividend rate of $3.00 per share. For more information on our dividend, see Note 10 of Notes to the Consolidated Financial Statements included in Part II, Item 8, “Financial Statements.”
Pending Acquisitions. In December 2017, we entered into agreements to acquire two companies in the health care sector for a total of approximately $7.7 billion, which are not reflected in the table above. One of the acquisitions closed in January 2018; the other is expected to close later in 2018, subject to regulatory approval and other customary closing conditions.
Revenue trends. Key revenue drivers for each reporting unit are determined and assessed. Significant factors include: customer and/or membership growth, medical trends and the impact and expectations of regulatory environments. Additional macro-economic assumptions relating to unemployment, GDP growth, interest rates and inflation are also evaluated and incorporated, as appropriate.
Through its diversified family of businesses, the Company leverages core competencies in data and health information; advanced technology; and clinical expertise to help meet the demands of the health system. These core competencies are deployed within two distinct, but strategically aligned, business platforms: health benefits operating under UnitedHealthcare and health services operating under Optum.
Depreciation expense for property and equipment for the years ended December 31, 2017, 2016 and 2015 was $799 million, $698 million and $613 million, respectively. Amortization expense for capitalized software for the years ended December 31, 2017, 2016 and 2015 was $550 million, $475 million and $430 million, respectively.
As of December 31, 2017, future minimum annual lease payments, net of sublease income, under all non-cancelable operating leases were as follows:
Total operating expenses were $5,902,488 for 2013, as compared to $5,321,113 for 2012. The increase of $581,375 or 11% was mainly due to increases in salaries, rents, bad debt expenses, and other general and administrative expenses, which were partially offset by a decrease in travel, and depreciation and amortization during the year. The reasons for the changes in the major items are as follows:
Salaries - increased by $404,802 or 13% from $3,014,156 in 2012 to $3,418,958 in 2013. Approximately 35% of the increase of the salary expenses came from ALCO Insurance. The remaining 65% increase was mainly due to increases in pay rates and headcounts during the year of 2013. In addition, pursuant to the Restricted Share Stock Compensation Plans, $36,205 was recognized as stock-based compensation expense in salaries during the year ended December 31, 2013. The amount of stock based compensation decreased $51,686, or approximately 59%, as
Depreciation and amortization - decreased by $27,666 or 17% from $162,872 in 2012 to $135,206 in 2013. Because the Hong Kong Office was moved to a new location in March 2012, beginning in November 2011, we amortized the net book value of the leasehold improvement of the old location over its reduced remaining life. Consequently, additional depreciation was charged in 2012. During the year of 2013, depreciation for fixed assets was $100,999, a decrease of $37,120, or 27%, from $138,119 in 2012, which was caused by the reason stated as above. Regarding the amortization charged for intangible asset, it was $34,207 for the year of 2013, an increase of $9,454 or 38% as compared to 2012. The increase is primary due to the additional charge produced from ALCO Insurance’s intangible asset acquired in 2011.
The following are the Company’s investments owned and securities sold short by level within the fair value hierarchy at December 31, 2013 and 2012 are as follows:
On August 4, 2012 and 2013, ALC entered into a loan extension agreement with JMISCL and JXISCL, respectively. Under the two extension agreements, the payable due date is extended to August 4, 2014. All terms and conditions of the loan agreement remain unchanged.
The Company has six material operating lease commitments for its facilities. The initial term of the lease arrangement for Director Quarter is two years beginning July 19, 2012 with a minimum lease commitment of $65,385.
Loss before income taxes from the Individual life, annuities and other segment increased $2.4 million for the year ended December 31, 2016, primarily due to the ceding of substantially all of the life and annuity blocks in the third quarter of 2015. Current year activity primarily consists of the amortization of the related reinsurance costs whereas prior year activity includes a $5.1 million pre-tax gain recorded in connection with the sale of the infrastructure associated with the administration of the individual life and annuity policies ceded in 2015;
At December 31, 2016, the Company’s market capitalization was less than its book value indicating a potential impairment of goodwill. As a result, the Company assessed the factors contributing to the performance of IHC stock in 2016, and concluded that the market capitalization does not represent the fair value of the Company. The Company noted several factors that have led to a difference between the market capitalization and the fair value of the Company , including (i) the Company’s stock is thinly traded and a sale of even a small number of shares can have a large percentage impact on the price of the stock, (ii) Geneve Corporation and insiders own approximately 58% of the outstanding shares, which has had a significant adverse impact on the number of shares available for sale and therefore the trading potential of IHC stock, and (iii) lack of analyst coverage of the Company. If we experience a sustained decline in our results of operations and cash flows, or other indicators of impairment exist, we may incur a material non-cash charge to earnings relating to impairment of our goodwill, which could have a material adverse effect on our results. No impairment charge for goodwill was required in 2016, 2015 or 2014.
Corporate derives its funds principally from: (i) dividends from the Insurance Group; (ii) management fees from its subsidiaries; and (iii) investment income from Corporate liquidity. Regulatory constraints historically have not affected the Company's consolidated liquidity, although state insurance laws have provisions relating to the ability of the parent company to use cash generated by the Insurance
The Company had receivables from reinsurers of $440.3 million at December 31, 2016 compared to $483.1 million at December 31, 2015. All of such reinsurance receivables are from highly rated companies or are adequately secured. No allowance for doubtful accounts was necessary at December 31, 2016.
Investments increased primarily as a result of the proceeds from the Risk Solutions Sale and Coinsurance Transaction.
Continue to increase IHC’s emphasis on lead generation for its direct-to-consumer and career advisor distribution initiatives, as well as experiencing the accompanying start-up costs of expanding our controlled sales through our call center, career model and transactional websites as a result of the acquisition of PetPlace.com, IHC’s ownership of HealtheDeals.com, and AspiraAmas and its investment in HealthInsurance.org.
Expand sales of our specialty health products as a result of investments in two call center agencies and a worksite marketing company.
• We realised the EUR 200 million cost reduction programme in the Netherlands one year ahead of schedule. We announced a new cost reduction programme to realise a cost base of EUR 700 million by 2018 for Netherlands Life, Netherlands Non-life and holding entities.
The rebranding campaign in Greece pushed the aided brand awareness of NN Hellas to 38% at the end of 2015. Even under difficult economic circumstances, the NN Hellas team managed to create value for its customers, who see them as a company that lives our values of care, clear, commit.
Market trends and our response In our view, we see a number of key trends in the insurance and asset management industry on which to focus in particular. In this paragraph, we mention the trends that are positioned in the upper right quarter of our materiality matrix on page 13.
We are well positioned to capitalise on the main developments in our sector
How we create value as an investor is described on pages 28–29 of this Annual Review.
For more information on NPS and how we measure it using the Global Brand Health Monitor, please refer to page 8 of this Annual Review.
With our strategy to deliver an excellent customer experience, our customers are at the heart of everything we do. In 2015, all our businesses delivered on this strategy.
Asset Management NN Investment Partners aims to deliver distinctive, actively managed investment products developed in a customer-centric way. We focus on illiquid fixed income, high distinct active equity and multi-asset products, developed with environmental, social and governance (ESG) factors top of mind.
Netherlands Insurance • For our Dutch pension book, we further developed the SAP platform for Defined Benefits and Defined Contribution customers, leading to improved straight-through processing and making operational costs per policy significantly lower.
• In Japan, we offer an innovative video-streaming service, NN Tube, which provides training and high-quality information to our independent agents. In 2015, we launched over 100 new videos on NN Tube and invested in further usability upgrades.
Financial liabilities at fair value through profit or loss: − non-trading derivatives 1,701 3,142
Disclaimer NN Group’s 2015 Annual Report consists of three documents: the 2015 Annual Review, the 2015 Financial Report and the 2015 Sustainability Supplement.
Net income for 1996 increased 17.8% to $55.7 million from $47.3 million in 1995. Basic earnings per share increased 14.3% to $3.12 in 1996 from $2.73 in 1995. Basic operating earnings per share, which excludes the impact of capital gains and losses and foreign exchange gains and losses, increased 15.1% to $2.97 in 1996. Diluted operating earnings per share increased 12.8% to $2.91 from $2.58 in 1995.
The weighted average shares outstanding for 1996 was 17.88 million compared to 17.32 million for 1995.
Premiums are earned in proportion to the level amortization of insured principal over the contract period. Deferred premium revenue represents that portion of premiums which will be earned over the remainder of the contract period. When insured issues are refunded or called, the remaining deferred premium revenue is generally earned at that time, since the risk to the Company is considered to have been eliminated.
California $7.7 $6.9 New York 6.2 6.2 Florida 4.1 4.2 Texas 3.7 3.1 Pennsylvania 2.9 3.1 New Jersey 2.6 2.1 Illinois 2.5 2.6 Other (each less than 2.5%) 34.7 28.4 ----- ----- Total $64.4 $56.6 ===== =====
Actuarial assumptions utilized to determine the projected benefit obligation and estimated unrecognized net loss were as follows:
1996 NUMBER OPTION PRICE OPTIONS OF SHARES PER SHARE - ------- --------- ---------
Policy acquisition costs of $1,462,733 were expensed in 1997 as compared to $1,302,327 in 1996, an increase of 12%. Policy acquisition costs expensed in 1996 reflect an increase of 20% from $1,084,577 in 1995. Such costs as a percentage of premiums earned are 25% in 1997, 24% in 1996 and 20% in 1995, and result primarily from ceding commissions paid to ceding companies determined contractually pursuant to reinsurance agreements.
Operating and management expenses decreased by 15% in 1997 to $619,684 from $727,780 in 1996. 1996 operating and management expenses decreased by 7% from $786,037 in 1995.
Underwriting, Acquisition and Insurance Expense. Underwriting, acquisition and insurance expenses were unchanged in 2007 from 2006 at $27.6 million. The 2006 increase to $27.6 million from $25.4 million in 2005 was largely attributable to higher cost of employee benefits, higher accounting fees related to financial statement and Sarbanes-Oxley compliance, and an increased contribution to the Company’s profit sharing plan.
own. Our assets consist of the capital stock of our subsidiaries. Accordingly, our cash flows depend upon the availability of statutorily permissible payments, primarily payments under management agreements from our two primary life insurance subsidiaries, CICA and SPLIC. The ability to make payments is limited by applicable laws and regulations of Colorado, CICA’s state of domicile, and Louisiana, Security Plan’s state of domicile, which subject insurance operations to significant regulatory restrictions. These laws and regulations require, among other things, that these insurance subsidiaries maintain minimum solvency requirements and limit the amount of dividends these subsidiaries can pay to the holding company. We historically have not relied upon dividends from subsidiaries for our cash flow needs and we do not intend to do so in the future.
insurance business, the Company believes it is important to have a high degree of comfort in its reserving process. As claims are settled in years subsequent to their occurrence, the Company's claim handling process has, historically, tended to produce savings from the reserves provided. The Company believes that favorable loss developments in recent years may be attributable, at least in part, to changes in trucking safety in general resulting from the implementation of the national commercial driver license, mandatory drug testing and an increased awareness by trucking companies of the cost of unsafe operations. It is further believed that the Company's selection techniques, minimum safety standards and claims handling have also contributed to this favorable loss experience. However, due to the aforementioned changes in the Company's reinsurance structure for its large trucking fleets, whereby a smaller portion of the risk is retained, the impact of future loss developments on the loss and loss expense ratios may not be consistent with prior years.
The following tables are reconciliations of reportable segment revenues and profits to the Company's consolidated revenue and income from operations before federal income taxes, respectively.
Net Investment Income. Net investment income in 1997 was $160.2 million as compared to $154.8 million in 1996, an increase of 3%. The increase is primarily due to an increase in average invested assets as a result of the SIG Merger and the investment of a portion of the proceeds from the issuance of the Capital Securities and net cash provided by operating activities, partially offset by a decrease in the weighted average yield. The 1996 investment results reflect strong performance by the Company's independent investment managers program. The weighted average annual yield on invested assets, excluding realized and unrealized investment gains and losses, was 7.8% on average invested assets of $2,049.3 million in 1997 and 8.5% on average invested assets of $1,823.2 million in 1996.
General. In March 1997, Delphi Funding issued $100.0 million liquidation amount of Capital Securities in a public offering under the Company's existing shelf registration statement. See "Business - Other Transactions" and Note K to the Consolidated Financial Statements. Of the net proceeds from the offering, $50.0 million was used to repay borrowings under the Credit Agreement, and the remainder was invested with selected independent investment managers.
The principal liquidity requirements of the Company's insurance subsidiaries are, in the cases of RSLIC, FRSLIC and SNCC, their contractual obligations to policyholders and contractholders, and in the case of RSLIC-Texas, its payments to the Company on the Surplus Debenture. The primary sources of funding for these obligations, in addition to operating earnings, are the marketable investments included in the investment portfolios of RSLIC, FRSLIC and SNCC. The Company believes that these sources of funding will be adequate for its insurance subsidiaries to satisfy on both a short-term and long-term basis these contractual obligations throughout their estimated or stated period.
- - - Heightened competition, particularly in terms of price, product features, and distribution capability, which could constrain the Company's growth and profitability.
- Costs associated with the product design and implementation of the new Futurity multi-manager annuity product and the development of a new product within the Regatta product line. The Company expects to continue to invest in further product enhancements in the future.
- - - Net investment income other than dividends from subsidiaries, was lower than in 1997 by $5.9, reflecting the effect of the Company's December 1997 issuance of a $250 million surplus note to its upstream holding company. Interest expense exceeded investment earnings on the related funds.
compliance by third-parties whose systems and operations affect the Company, and other similar uncertainties. A possible worst-case scenario might include one or more of the Company's significant systems being non-compliant. Such a scenario could result in material disruption to the Company's operations. Consequences of such disruptions could include, among other possibilities, the inability to update customers' accounts, process payments and other financial transactions; and report accurate data to customers, management, regulators, and others. Consequences also could include business interruptions or shutdowns, reputational harm, increased scrutiny by regulators, and litigation related to Year 2000 issues. Such potential consequences, depending on their nature and duration, could have a material impact on the Company's results of operations and financial position.
12. SEGMENT INFORMATION (CONTINUED): The following amounts pertain to the various business segments:
- - ------------------------ * Total expenditures include dividends to policyholders of $(5,981) for 1998, $33,316 for 1997 and $29,189 for 1996.
Reinsurance. We cede insurance risk under various reinsurance agreements. We seek to reduce the loss that may arise from catastrophes or other events that cause unfavorable underwriting results by reinsuring certain levels
Net operating expense (non-GAAP). These expenses consist of the sum of general and administrative expenses and acquisition costs and other underwriting expenses less ceding commission income, service and fee income and other general and administrative expenses (M&A advisory cost / Arbitration award).
We have $350.0 million aggregate principal amount outstanding of our 6.75% Notes due 2024 (the “6.75% Notes”). The 6.75% Notes bear interest at a rate equal to 6.75% per year, payable semiannually in arrears on May 15 and November 15 of each year. The 6.75% Notes are our general unsecured obligations and rank equally in right of payment with our other existing and future senior unsecured indebtedness and senior in right of payment to any of our indebtedness that is contractually subordinated to the 6.75% Notes. The 6.75% Notes mature on May 15, 2024, unless earlier redeemed or purchased by us. Interest expense on the 6.75% Notes was $23.6 million for each of the years ended December 31, 2020, 2019, and 2018.