felanders/preprocessed huggingface dataset:
Projected capital expenditures for 1997 total approximately $5,291,000. Of this, approximately $4,581,000 consists of leasing commission and tenant alterations. The largest of these is $3,108,000 planned for the Lisle, IL office center. The property expects to pay approximately $2,298,000 in tenant improvements and $810,000 in leasing commissions to acquire a new tenant, as R.R. Donnelley will be leaving at the expiration of their lease in September. At the Morristown Office Center, approximately $914,000 has been budgeted in tenant improvements and leasing commissions, of which approximately $878,000 relates to efforts to renew the Smith Barney lease prior to the October, 1997 expiration. Tenant improvements and leasing commissions have been budgeted for approximately $254,000 at the Roswell, GA retail center, approximately $186,000 at the Nashville office center and approximately $119,000 at the Pomona warehouse. All of these projected expenditures relate to prospective leases and are based on reasonable cost. The actual amount of such expenditures will depend on the number of new leases signed, the actual needs of the particular construction or repair, and the timing of lease executions.
The Lisle office, experienced an unrealized loss of approximately $1,700,000 (14.7% of its year-end 1995 value). This was caused by R.R. Donnelley (sole- tenant) not renewing its lease, which expires September 1997, and the anticipated expenses that will be incurred in order to release the building in 1997. The Morristown property experienced an unrealized gain of approximately $409,000 (4.3% of its December 31, 1995 value), due to improved market conditions in the Northern, NJ market. The Nashville office experienced an unrealized gain of approximately $166,000. The increase represented 1.9% of its year-end 1995 value. The rise in value reflects the expectations of continued high
The decline in market interest rates from 2001, had a negative impact on the interest spread which is the difference in the Company’s investment portfolio rate and the interest rates credited on policyholder contracts for universal life insurance and annuities. The Company responded to the lower market rates by lowering many of the credited rates on its policies during 2003 and 2004. However, universal life insurance and annuity policies have contractual minimum guaranteed rates and credited rates cannot be lower than such minimums. Because many of the Company’s policies have minimum guaranteed rates of 4.0%, the market interest rate environment in recent years has put pressure on the Company’s interest spread.
$0.4 million paid to William P. Tedrow in connection with the New Era acquisition in June 2003 (see Registrant's Quarterly Report on Form 10-Q for the three-month period ended June 30, 2003 for a further description of this payment); and
The information set forth in the following table should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the Consolidated Financial Statements and Notes thereto.
preferred dividends paid by $7.7 million on an annual basis. The new common shares require dividends of the same rate paid on all other outstanding common shares.
General, administrative and other ("G&A") costs increased 5.8% to $53.7 million for the twelve months ended December 31, 1994 compared to the twelve months ended December 31, 1993. As a percentage of revenues, however, G&A costs for the twelve months ended December 31, 1994 decreased to 18.1% from 19.7% during the comparable period in 1993. Compensation costs increased approximately $2.4 million primarily resulting from additional employees supporting expanded services. Depreciation expense increased approximately $1.2 million primarily due to the Company's newly constructed home office, regional home office and administrative headquarters which were occupied late in the fourth quarter of 1993. Additionally, interest expense increased approximately $1.7 million principally due to new mortgage financing on certain of the Company's owned facilities.
MEDICAL CLAIMS PAYABLE includes the estimated cost for unpaid claims for which health care services have been performed and a provision of the estimated costs for claims that have occurred but have not been reported.
RECLASSIFICATIONS. Effective January, 1994, the Company reclassified amounts in its Consolidated Statements of Operations to provide additional information to reflect expanded operations. Specialty Product Revenue (previously included in Premiums and Other Revenue) and Specialty Product Expenses (previously included in General and Administrative Expenses and Other Operating Expenses) are now reflected in separate line items. Certain other operating costs were reclassified to Medical Expenses. Amounts in the Consolidated Statements of Operations for the years ended December 31, 1993 and 1992 have been reclassified to conform with the current year presentation.
A summary of the provision for income taxes for the years ended December 31, 1994, 1993 and 1992 is as follows:
RESERVE for o-ei.tsta.rLd.in.g- losses: Life . Frs. 296,909. — Fire, Marine, Accident and Burglary . „ 4,796,388.03
Lloyd's Operations: Marine............................... $ 76,101 40% $ 63,040 38% $ 46,637 27% Engineering and Construction......... 936 1 961 1 - - Onshore Energy....................... 520 - 1,346 1 - - -------- -- -------- -- -------- -- Gross Written Premium.............. 77,557 41 65,347 40 46,637 27 -- -- -- Ceded Written Premium.............. (21,257) (12,250) (7,441) -------- ------- -------- Net Written Premium................ 56,300 53,097 39,196 -------- -------- --------
Commission Income. Commission income increased in 2000 primarily due to the absence to a great extent of the factors that reduced commission income in 1999. Commission income decreased from 1998 to 1999 due to Navigators Insurance increasing its participation in the marine pool from 60% in 1998 to 75% in 1999, the losses related to unrecoverable reinsurance which reduced the profit commission, the Company's reduction of its commission income estimates due to the extremely competitive rate environment and less profit commission earned by MTC in 1999 than in 1998.
Net Investment Income. Net investment income increased 15.4% from 1999 to 2000 and 5.1% from 1998 to 1999 primarily due to an increase in investment income allocated to NCUL and Millennium from the investments at the Lloyd's syndicates due to their increased participation in Syndicate 1221 and reduction in the Insurance Companies' municipal portfolio. Increased yield in the portfolio and reduction in the expenses to manage the portfolio also increased investment income in 2000. The investments at NCUL and Millennium are represented by funds due from the Lloyd's syndicates to the Company.
The Life and Health Group leases facilities at 204 locations in 28 states and the District of Columbia with aggregate square footage of approximately 526,000. The terms of these leases range from monthly tenancies to 5 years.
Effective January 1, 1997, United entered into an agreement to cede all in- force life, health, property and casualty insurance policies written by the Life and Health Group's home service operations in the states of Arkansas and Missouri to a third party. As a result of this transaction, annual premium income will decrease by approximately $10.8 million in the Company's Life and
We have the honour to present to you the Seventy-sixth Annual Report and Statement of Accounts of the Company for the year 1939.
Premium Reserve Frs. 71,275,755. — Reserve for Unsettled Claims . 98,705,425. — Reserve for Extraordinary Losses 10,000,000. — 179,981,180 —
The income of an insurance agency business such as the Company is principally derived from commissions earned, which are generally percentages of premiums placed with insurance underwriters. Premium pricing within the insurance underwriting industry has been cyclical and has displayed a high degree of volatility based on prevailing economic and competitive conditions. Decreases in premium rates result directly in revenue decreases to the Company. Since 1987, the property and casualty insurance industry has been in a "soft market," during which the underwriting capacity of insurance companies expanded, stimulating an increase in competition and a decrease in premium rates and related commissions and fees. The effect of the softness in rates on the Company's revenues has been offset by the Company's acquisitions and new business programs. Management cannot predict the timing or extent of premium pricing changes due to market conditions or their effects on the Company's operations in the future, but believes that the "soft market" conditions will continue into 1999.
for $40.0 million under loans due in 2003. At December 31, 1998, there were loans of $40.0 million outstanding under the agreement.
Renewal revenue can be affected by policy surrenders or exchanges, material contract changes, asset growth and case mortality rates. Traditionally, Clark/Bardes has experienced persistency rates on the in force insurance underlying the Clark/Bardes' programs that is in the upper-ninety percent range, with the exception of Leveraged COLI business, which was affected by adverse tax law changes, and the restructuring of Confederation Life Insurance Company. Renewal revenue accounted for approximately 50.7% of Clark/Bardes' total revenue for the year ended December 31, 1998.
In June 1997, the FASB issued SFAS No. 131 "Disclosures About Segments of an Enterprise and Related Information." SFAS No. 131 requires public enterprises to report selected information about operating segments in annual and interim reports issued to shareholders. It is effective for financial statements for fiscal years beginning after December 15, 1997, but it is not required to be applied to interim financial statements in the initial year of its application. The adoption of this Statement will have no impact on Clark/Bardes' financial condition or results of operations. This statement has been adopted by Clark/Bardes and is presented in the accompanying financial statements.
Clark/Bardes depends heavily on a small number of insurance companies to underwrite the insurance policies underlying the programs Clark/Bardes markets. More specifically, Clark/Bardes currently utilizes
While the federal government does not directly regulate the marketing of most insurance products, certain products, such as variable life insurance, must be registered under the federal securities acts and therefore the producers and the entities selling such products must be registered with the NASD. Clark/ Bardes markets such insurance products through an entity registered as a broker-dealer and for which Clark/ Bardes provides almost all services by means of an administration and services agreement. The broker-dealer is owned by W.T. Wamberg (68.2%) and Malcolm Briggs (31.8%). Messrs. Wamberg and Briggs are stockholders of Clark/Bardes Holdings and Mr. Wamberg is Chairman of Clark/Bardes Holdings. While
Except as mentioned below, the Company leases its Agencies' offices. For information with respect to the Company's lease commitments see "Note H--Leases" of the Notes to Consolidated Financial Statements in the Company's 1997 Annual Report to Shareholders which is incorporated herein by reference.
Ameriprise Financial was formerly a wholly-owned subsidiary of American Express Company ("American Express"). On February 1, 2005, the American Express Board of Directors announced its intention to pursue the disposition of 100% of its shareholdings in Ameriprise Financial (the "Separation") through a tax-free distribution to American Express shareholders. Effective as of the close of business on September 30, 2005, American Express completed the Separation and the distribution of Ameriprise Financial common shares to American Express shareholders (the "Distribution"). In connection with the Distribution, Ameriprise Financial entered into certain agreements with American Express to effect the Separation and to define the responsibility for obligations arising before and after the date of the Distribution, including, among others, obligations relating to transition services, taxes, and employees. Ameriprise Financial has incurred $654 million of pretax non-recurring separation costs since the Separation announcement through December 31, 2006 and expects to incur a total of approximately $875 million. RiverSource Life was allocated certain expenses incurred as a result of Ameriprise Financial becoming an independent company. RiverSource Life has been allocated $252 million in total pretax non-recurring separation costs since the Separation announcement through December 31, 2006 and expects to be allocated a significant portion of the remaining separation costs in 2007. RiverSource Life received a capital contribution of $650 million from Ameriprise Financial during the third quarter of 2005 to support its financial strength ratings and to cover separation costs.
For the year ended December 31, 2006, RiverSource Life recorded a net benefit from DAC unlocking of $26 million, primarily resulting in a $38 million benefit in DAC amortization expense and a $12 million increase in death and other benefits for investment contracts and universal life-type insurance. DAC unlocking for the third quarter of 2005 resulted in a $67 million reduction to DAC amortization.
Investments include $1.7 billion and $2.1 billion of below investment grade securities classified as Available-for-Sale securities (excluding net unrealized appreciation and depreciation) at December 31, 2006 and 2005, respectively. These investments represent 7% of RiverSource Life's investment portfolio at both December 31, 2006 and 2005.
Losses incurred include two components: a) actuarial re-evaluation of incurred loss levels for the current accident year, and b) actuarial re-evaluation of incurred loss levels for prior accident years. These components take into consideration prior loss experience, loss trends, and changes in the frequency and severity of claims. Any adjustments related to previously established amounts are included in current operations.
Risks which could adversely affect the Company's operations and/or cause actual results to differ materially from anticipated results include, but are not limited to, the following:
SEGMENT INFORMATION 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 reinsurance on both a treaty and facultative basis through reinsurance brokers as well as directly with ceding companies within the United States. The U.S. Insurance operation writes property and casualty insurance primarily through general agent relationships and surplus lines brokers within the United States. The Specialty Underwriting operation writes accident and health ("A&H"), marine, aviation and surety business within the United States and worldwide through brokers and directly with ceding companies. The International operation writes property and casualty reinsurance through the Company's branches in Belgium, London, Canada, and Singapore, in addition to foreign "home-office" business.
INCOME TAXES. The Company generated income tax benefits of $9.2 million in 2001 compared to income tax expense of $43.8 million in 2000. This tax benefit primarily resulted from the impact of losses relating to the September 11 attacks, the Enron bankruptcy and realized capital losses recognized in 2001, which reduced taxable income, partially offset by the impact of income tax expense relating to the non-recurring receipt of shares in connection with a former client's demutualization.
o fluctuations in interest rates, inflationary pressures and other changes in the investment environment, which affect returns on invested capital and may impact the ultimate payout of loss amounts;
The Company's continuing operations consist of its non-prime automobile finance business and its long distance telephone services business. Except as otherwise noted, the following discussion of the results of operations is with respect to the Company's continuing operations.
1996 1995 --------------- --------------- Allowance for credit losses $ 15,725,000 $ 6,818,000 Percentage of outstanding automobile 25.5% 21.3% receivables
the year ended December 31, 2001 attached in Exhibit 13. Certain accounting policies are viewed by
Schedule V - Valuation and Qualifying Accounts December 31, 1997, 1996 and 1995.........................F-23
Business operations The Company utilizes services and business facilities owned or leased, and operated by AIC in conducting its business activities. The Company reimburses AIC for the operating expenses incurred by AIC on behalf of the Company. The cost to the Company is determined by various allocation methods and is primarily related to the level of services provided. Expenses allocated to the Company were $27,632, $23,134 and $21,288 in 1997, 1996 and 1995, respectively. A portion of these expenses related to the acquisition of life and annuity business is deferred and amortized over the contract period.
Mortgage loan impairment A mortgage loan is impaired when it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement.
Securities on deposit At December 31, 1997, fixed income securities with a carrying value of $1,981 were on deposit with regulatory authorities as required by law.
THE YEAR 2000 ISSUE. Information technology is a crucial part of the Company's business. Accordingly, the Company has completed a comprehensive Year 2000 ("Y2K") readiness program that addressed challenges associated with the Y2K issue. As a result of this program, the Company encountered no major automation or business disruption due to Y2K issues. The Company continues to operate normally across all business units and geographies and will continue to monitor operations throughout 2000. The total costs incurred for the Y2K readiness program were $3.6 million.
Our significant accounting policies are more fully described in Note 3 to our consolidated financial statements. However, one of our accounting policies is particularly important to the portrayal of our financial position and results of operations and requires the application of significant judgment by our management; as a result it is subject to an inherent degree of uncertainty.
We lease office space for our principal executive offices in Woodland Hills, California and our offices in Rancho Cordova, California. Our executive offices, comprising approximately 115,000 square feet, are occupied under a lease expiring December 31, 2004. A significant portion of our California HMO operations are also housed in Woodland Hills, in a separate, 325,000 square foot leased facility. This new, two-building facility was occupied at the end of 2001, under a lease that expires December 31, 2011. Combined rent for our Woodland Hills facilities was approximately $12.1 million in 2001.
Since we are considered a “shell company” under applicable securities laws, we did not generate any revenues during the fiscal years ended December 31, 2013 or 2012. We anticipate that we will incur substantial losses for the foreseeable future and our ability to generate any revenues during the next 12 months is uncertain.
The Company has outstanding warrants to employees and non-employees allowing the purchase of stock at a price of $10.00 per share. None of the 49,500 non-employee warrants in 2013 or the 49,500 non-employee warrants in 2012, all of whose exercise price exceeded market value as of the date of the grant, have been exercised. Information regarding the warrants for the years ended December 31, 2013 and 2012 is as follows.
The Company's operating results are subject to significant fluctuations from period to period depending upon, among other factors, the frequency and severity of losses from weather related and other catastrophic events, the effect of competition, and regulation on the pricing of products, changes in interest rates, general economic conditions, tax laws and the regulatory environment. As a condition of its license to do business in various states, the Company is required to participate in a variety of mandatory residual market mechanisms (including mandatory pools) which provide certain insurance (most notably automobile insurance) to consumers who are otherwise unable to obtain such coverages from private insurers. Residual market premium rates for automobile insurance have generally been inadequate. The amount of future losses or assessments from residual market mechanisms can not be predicted with certainty and could have a material adverse effect on the Company's results of operations.
Incorporated by reference to "11-Year Summary of Selected Financial Data" on pages C-2 and C-3 of the Proxy Statement.
Acquisition Cost Ratio. The acquisition cost ratio is the ratio of policy acquisition costs and other underwriting expenses to net premiums earned. The acquisition cost ratio measures our operational efficiency in producing, underwriting and administering our reinsurance business. The acquisition cost ratio decreased from 8.9% for the year ended December 31, 2014 to 5.1% for the year ended December 31, 2015. The decrease is due to the overall lower weighted-average acquisition costs on reinsurance contracts in force during the year ended December 31, 2015, coupled with the expiration of Resonant consulting agreement discussed above.
Restricted Cash and Cash Equivalents. As of December 31, 2015, our restricted cash and cash equivalents increased by $2.2 million, or 8%, to $30.4 million, from $28.2 million as of December 31, 2014. The overall increase is due to collateral being placed for June 1, 2015 insurance contracts partially offset by collateral being returned on expiration of a number of insurance contracts at May 31, 2015.
Net cash provided by operating activities for the year ended December 31, 2015 totaled $8,126, which consisted primarily of cash received from net written premiums less cash disbursed for operating expenses. Net cash used in investing activities of $1,951 was primarily due to the net sales of available for sale securities and increased collateral deposited in trust accounts. Net cash used in financing activities totaled $2,908 representing cash dividend payments.
The year ended December 31, 2018 was the fourth costliest year since 1980 in terms of insured losses due an accumulation of severe and costly natural disasters particularly in the second half of 2018.
Net cash used in operating activities for the year ended December 31, 2017 totaled $26,310, which consisted primarily of cash received from net written premiums less cash disbursed for operating expenses and net loss payments. Net cash provided by investing activities of $4,667 was primarily due to the net sales of available for sale securities and collateral withdrawals from trust accounts to settle losses arising during the year. Net cash used in financing activities totaled $3,152 representing net cash dividend payments and cash used to repurchase ordinary shares under the Company’s share repurchase plan.
Loss experience refund payable. Certain contracts include retrospective provisions that adjust premiums or result in profit commissions in the event losses are minimal or zero. Under such contracts, the Company expects to recognize aggregate liabilities payable to the ceding insurers assuming no losses occur during the contract period. In accordance with U.S. GAAP, the Company will recognize a liability in the period in which the absence of loss experience obligates the Company to pay cash or other consideration under the contract. On the contrary, the Company will derecognize such liability in the period in which a loss experience arises. Such adjustments to the liability, which accrue throughout the contract term, will reduce the liability should a catastrophic loss event covered by the Company occur.
The information required by Item 7(a) is incorporated herein by reference to the section entitled "Market Risk" on pages 28 through 29 of the Company's 1999 Annual Report to Shareholders.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Pages 43 through 75 of the 1998 Annual Report to Shareholders are incorporated herein by reference.
During 1998, 89% of revenue was earned from two customers: the WHC and Presbyterian Healthcare System ("PHS"). WHC provided revenue totaling $2,740,000, or 66% of total revenue. Of this WHC revenue, 65% was provided as a result of the Ongoing Accounts Receivable Management services contract, as amended, entered into in 1992, and 35% related to a physician billing contract amendment entered into in May, 1997. PHS provided revenues, primarily under various early out and bad debt collection contacts entered into in 1997, totaling $985,000, or 23% of total revenue. Of this PHS revenue, 87% was provided from Collection Agency services, and 13% was provided from UMClaimPros services.
o The Company executed the following contracts which generated no revenue in 1999:
Selected Financial Data. - - - --------------------------------- Information required under this item is incorporated herein by reference to the first column on page 16 and related notes on page 17 of the 1998 Annual Report.
The carrying amounts of Brown & Brown’s financial assets and liabilities, including cash and cash equivalents, restricted cash and investments, investments, premiums, commissions and fees receivable, premiums payable to insurance companies, premium deposits and credits due customers and accounts payable, at December 31, 2009 and 2008, approximate fair value because of the short-term maturity of these instruments. The carrying amount of Brown & Brown’s long-term debt approximates fair value at December 31, 2009 and 2008 since the related coupon rate approximates the current market rate.
Amortization expense for other amortizable intangible assets for the years ending December 31, 2010, 2011, 2012, 2013 and 2014 is estimated to be $49,654,000, $48,208,000, $47,566,000, $46,665,000, and $45,479,000, respectively.
Revenues increased $6.2 million, or 63%, to $15.9 million in 2004 from $9.7 million in 2003. The components of revenue are as follows:
arrangements. It appears that these investigations could have far-reaching consequences in the insurance industry. For example, Marsh & McLennan Companies, Inc. (Marsh), Willis Group Holdings Ltd. and Aon Corp., three of the largest insurance brokerage firms in the industry, have each announced that they will no longer accept contingent commissions. Although the New York Attorney General’s October 14, 2004 complaint against Marsh focused primarily upon arrangements with property and casualty insurance carriers, subpoenas have been served on a number of group life and disability and traditional health carriers, as well as the insurance brokerage companies who assist in the placement of such types of insurance. At the press conference announcing its complaint against Marsh, the New York Attorney General indicated that its investigation would look across various lines of insurance. In addition, the departments of insurance for various states have proposed new regulations, and other state insurance departments have indicated that they will propose new regulations, that address contingent commission arrangements, including prohibitions involving the payment of money by insurance carriers in return for steering business and enhanced disclosure of contingent commission arrangements to insureds. On December 29, 2004, the National Association of Insurance Commissioners announced that it has proposed model legislation to implement new disclosure requirements related to broker compensation arrangements.
proprietary rights. Even if we eventually won, any resulting litigation could be time-consuming and expensive to defend and could divert our management’s attention.
Demand for our services may be reduced if we are unable to safeguard the security and privacy of our customer’s information
As of March 21, 2005, Robert Bland, our chairman, President and Chief Executive Officer directly or indirectly controlled 31.1% of our outstanding common stock, William Thoms, our Executive Vice President and Chief Operating Officer, directly controlled 7.9% of our outstanding common stock, and Zions Bancorporation controlled 32.2% of our common stock. As a result, if Zions and Messrs. Bland and Thoms act together, or if Zions and Mr. Bland act together, they will be able to take any of the following actions without the approval of additional public stockholders:
Financial position of the Company. CAPITAL fully subscribed (25 "/» paid-up) Frs. 10,000,000. — RESERVE FUND „ 1,000,000. — SPECIAL RESERVE FUND . „ 1,200,000.— FIRE, Accident, Liability, Marine, Burg­
Premium Reserve from 1908 Reserve for outstanding losses from 1908 . . i . . . Net premium.^
Life BepL; Premium Reserve from 1908 . . . K . Annuity Fund from 1908 ... . Reserve for outstanding losses from 1908 . . .. . . . Premiums, less cancellations ..... . . .. Consideration for Annuities, less retrocession . . . . . Interest .... Interest, after deduction of interest on Life Dept- account
Shareholders' Bills . . . . ,. 7,500,000 — House Property . . . . . . ...... . L Fr. 350,000.-
a) Outsourcing service fees represent fees earned under a contract with Reliance Insurance Company for servicing policies and claims on the run-off of their non-standard automobile insurance business. We entered into this contract in connection with our acquisition of the non-standard automobile operations of Reliance Group Holdings in April 2001. These fees do not represent a recurring source of income.
net premiums earned, which comprises the premiums we earn from sales of automobile insurance policies less those premiums that we cede to our reinsurers;
In the aggregate, we have now deployed point-of-sale underwriting in 18 states, and we utilized point of sale underwriting on 99% of new business applications in the fourth quarter of 2005. We have fully deployed OneStep in South Carolina, California, and Ohio for both new business and endorsements. Additionally, we are in the process of deploying OneStep in Texas. We have deployed OneStep Raptor in all but three of our other states.
Interest Expense. Interest expense was $4.2 million for the twelve months ended December 31, compared to $3.0 million for the same period of 2004. Interest incurred pertains to our debt, which we refinanced on February 18, 2004. The aggregate weighted average interest rate was 5.0% during the twelve months ended December 31, 2005 compared to 3.2% during the same period of 2004. The rate we pay on our debt is variable tied to the London Interbank Offered Rate (“LIBOR”). The average LIBOR rate was higher during the twelve months ended December 31, than in the comparable period of 2004. As of December 31, 2005, we had $69.9 million of outstanding debt compared to $73.4 million at December 31, 2004.
Twelve Months Ended December 31, 2004 compared to Twelve Months Ended December 31, 2003
In February 2004, we completed an initial public offering of 17,250,000 shares of our Common Stock. We sold 6,250,000 shares, providing us with net proceeds, after deducting issuance costs, of approximately $113.4 million. We contributed $110.0 million of the proceeds to our insurance subsidiaries, which increased their statutory surplus.
Unitrin's subsidiary, United, owns the 41-story office building at One East Wacker Drive, Chicago, Illinois, that houses the executive offices of Unitrin and United. Unitrin and United occupy approximately 160,000 square feet of the 527,000 rentable square feet in the building. Unitrin's subsidiary, Milwaukee Insurance Group, Inc., owns a two-story office building in downtown Milwaukee, Wisconsin, consisting of approximately 132,000 square feet, which houses the Property and Casualty Group's northern regional office. In addition, the Life and Health Group occupies approximately 211,000 square feet in 29 Company-owned buildings located in 14 states.
On February 23, 1998, Starwood Hotels & Resorts Worldwide, Inc. ("Starwood") announced the completion of its acquisition of ITT Corporation ("ITT"). The Company owned 243,100 shares of ITT common stock which were acquired by Starwood in the acquisition and, accordingly, will recognize an after-tax gain of approximately $11.7 million in the first quarter of 1998.
Management expenses, taxes, fluctuations in stock exchange and foreign currency rates 56* 157
Members of Management in Advisory Capacity Robert P. Brouwer Max L. Hefti Alain Perret* Hans H.Zollinger Kurt Egg Oskar Jenni Ernst Schlenker Hans F. Enzmann Brian R. Lacock* Herbert Tiedemann Max Gasche Roland Maag Francis James Wingrove
Experience shows that international reinsurance can, for example, more or less overcome the repercussions of Inflation and of substantial foreign currency fluctuations. If the conditions of reinsurance treaties are drafted ac­ cordinglyand adapted regularly and If the state does not unduly hamper reinsurance activity by laws and regula­ tions. This means, among other things, that the state should not do anything to hinder an adjustment of insur­ ance premiums to the growing loss burden, nor should It put any obstacles In the way of the reinsurer if he wants to earn reasonable Interest on his technical reserves and transfer foreign currencies freely.
The premiums of Motor reinsurance also grew. Never­ theless, despite an improvement of the result-two-thirds in non-proportional and one third in proportional reinsur­ ance business - it was not yet possible to make a profit.
In the year under report, the Swiss Re Group grew by three new companies: the SwissRe Life insurance Com­ pany, Deiaware/U.S., the Tudor insurance Company, New Hampshire/U.S., and the mh Bausparkasse AC, Munich.
The effect of exchange rates on the Croup account turned out to be less than in the previous year, since the movements ot exchange rates kept within narrow bounds, in addition, as a result ot the altered balancesheet date to the end ot December, there are only six months between the two evaluation dates.
Result from further Income and outgo 104 - 15 89 71
In the year under report the consolidated capital funds of the Group rose by Sw. frs. 43 million toSw.frs. 665 million. Changes in the consolidated capital funds are shown in the following table: Profit and Loss Account
. increased personnel costs in all areas, caused by an increase in the number of full time employees from 934 in 1998 to 1,143 in 1999 to 1,373 in 2000. Included in the 2000 increase are additional Program Operations personnel, whose duties include oversight of all managing general agents and implementing exit strategies for poorly performing programs; and
The Company believes that a further downgrade by A.M. Best would be detrimental to ongoing business and that it would lead to a significant reduction in the amount of business that the Company would be able to write which, in turn, would reduce the amount of fee income.
Total assets increased to $4.9 billion at December 31, 2000, a 20% increase from $4.0 billion at December 31, 1999. Reinsurance recoverable grew from $1.7 billion in 1999 to $2.3 billion in 2000. This increase, which is largely offset by significant development in the reserve for losses and loss expenses, is due to the greater amount of reinsurance utilized in connection with the Company's Program Business. Assets held in separate accounts accounted for $799.8 million, or 16%, of total assets in 2000 and $693.4 million, or 17%, in 1999. As detailed in note 2A to the Consolidated Financial Statements, these assets are principally managed assets attributable to participants in the Company's IPC Programs.
Endowment product sales have been the primary driver of sales in this segment. The Company currently offers a fifteen and twenty year endowment and our top selling endowment is a product that matures at age sixty-five. The Company repriced its top six selling international products at the end of 2016 to increase profitability.
Financial stability and capital preservation are important investment considerations for the Company. A primary investment goal is the conservation of assets due to the long-term nature of a significant portion of our liabilities. The administration of our investment portfolios is handled internally, pursuant to board-approved investment guidelines, with all trading activity approved by a committee of each entity’s respective board of directors. The guidelines used require that securities are of high quality and investment grade. 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, mortgage loans and real estate within certain specified percentages. The assets selected are generally intended to mature in accordance with the average maturity of the insurance products and to provide the cash flow for our insurance company subsidiaries to meet their respective policyholder obligations. Due to the prolonged low interest rate environment, we have intentionally shortened the duration of our asset portfolio to capitalize on new investment purchases as interest rates rise. As rates rise, we plan to extend assets durations and increase investment yields.
premium per policy and the deferred policy acquisition costs per policy are then calculated. The deferred policy acquisition costs are then evaluated for recoverability using best estimate assumptions. Management believes that our deferred policy acquisition costs and related amortization for the years ended December 31, 2017, 2016 and 2015 limits the amount of deferred costs to its estimated realizable value. This belief is based upon the analysis performed on capitalized expenses that vary with and are directly related to the acquisition of new and renewal insurance business, utilization of the factor method and recoverability testing at the time of policy issuance and the annual loss recognition testing.
The significant accounting policies requiring our estimates and judgments are discussed below. Such estimates and judgments are based on historical experience, changes in laws and regulations, observation of industry trends and information received from third parties. While the estimates and judgments associated with the application of these accounting policies may be affected by different assumptions or conditions, we believe the estimates and judgments associated with the reported consolidated financial statement amounts are appropriate in the circumstances. For additional discussion of our accounting policies, see Note 1 to the audited consolidated financial statements included in this report.
Comparison of Years ended December 31, 2017 and December 31, 2016
The life insurance products division's income before investment transactions rose $15 million (21%) in 1998. Excluding the $20.1 million after tax charge discussed above, 1998 income decreased $5.1 million primarily due to higher net claims that were partially offset by higher investment income and lower operating expenses.
Net gain on sale of investments $ 312.6 $ 32.9 $ 41.9 Provision for impairment in value (31.1) (11.4) (5.9) Amortization of acquisition costs (102.7) 5.8 (21.8) -------- ------- ------- $ 178.8 $ 27.3 $ 14.2 ======== ======= =======
Arista may pay dividends to the Registrant from its statutory earned surplus pursuant to statutory restrictions imposed under the New York State Insurance Law. The maximum amount of dividends that may be paid in any twelve-month period without the prior approval of the New York State Insurance Department is the lesser of adjusted net investment income or 10% of statutory surplus as defined in the New York State Insurance Law. In 1996 and 1994, Arista's Board of Directors authorized the payment of a dividend to the Registrant in the amount of $111,654 and $224,799, respectively. The dividends were paid on April 11, 1996 and May 16, 1994. See "Business-Regulation."
Prepaid reinsurance premiums as of December 31, 2009, increased $2.1 million to $25.1 million compared to $22.9 million as of December 31, 2008. The increase results from AAIC’s continued growth and represents premiums ceded to its reinsurers which have not been fully earned.
Industry averages and average paid losses by state and other geographical regions;
Inflation and changes in automobile repair costs, medical costs and industry averages; and
AssuranceAmerica cedes a significant portion of its personal automobile premium to other reinsurers. The Company’s reinsurance strategy is to use quota share reinsurance to mitigate the financial impact of losses on its operations, while enabling premium growth within its capital base. Historically, the Company’s reinsurance contracts have been one or two years in duration, subject to renewal.
Our net income was $78.2 million, $301.6 million and $412.4 million in 2017, 2016 and 2015, respectively. The changes were primarily driven by the financial component fluctuations explained above.
Everest Re and Bermuda Re and is also the result of timing; premiums are earned ratably over the coverage period whereas written premiums are recorded at the initiation of the coverage period.
Commission and brokerage decreased by 4.8% to $189.5 million in 2016 compared to $199.0 million in 2015. The decrease is mainly due to the impact of the new crop reinsurance contract effective upon the sale of Heartland, the impact of affiliated quota share contracts and changes in the mix of business. Segment other underwriting expenses increased to $54.1 million in 2016 from $50.1 million in 2015. The increase was primarily due to the impact of changes in the mix of business and higher compensation costs.
Gross written premiums decreased by 7.6% to $1,269.1 million in 2016 compared to $1,374.0 million in 2015, primarily due to declines in Latin American, Middle East and Asian business and the negative impact of $40.7 million from the movement of foreign exchange rates. Net written premiums decreased by 11.6%
Future contract and policy benefits are liabilities for traditional life, disability, stop-loss and annuity products. Such liabilities are established in amounts adequate to meet the estimated future obligations of policies in force. The liabilities associated with traditional life insurance, annuity and disability insurance products are computed using the net level premium method based on assumptions about future investment yields, mortality, morbidity and persistency. The assumptions used are based upon the Company's experience and industry standards.
The Company has established separate accounts applicable to various classes of contracts providing for variable benefits and they are generally not subject to liabilities that arise from any other business of the Company. Separate account assets are subject to general account claims only to the extent the value of such assets exceeds the separate account liabilities. Contracts for which funds are invested in separate accounts include variable life insurance and individual qualified and non-qualified variable annuity contracts. Assets and liabilities of the separate accounts, representing net deposits and accumulated net investment earnings, less fees, held primarily for the benefit of contractholders, are shown as separate captions in the financial statements. Assets held in the separate accounts are carried at market value and the investment risk of such securities is retained by the policyholder.
Establishment of reserves primarily related to death benefit and income benefit guarantees provided under variable annuity contracts; and
The gross unrealized losses and fair value of investments, which have been deemed to be temporarily impaired, aggregated by investment category, number of securities and length of time that securities have been in an unrealized loss position at December 31, 2004 is as follows:
The Company has an agreement with an unrelated company whereby the unrelated company reinsures the mortality risks of the Company's group life contracts. Under this agreement, certain group life mortality benefits are reinsured on a yearly renewable term basis. The agreement provides that the unrelated company will reinsure amounts above $700,000 per claim for group life contracts ceded by the Company.
The Company leases various facilities and equipment under non-cancelable operating leases with terms of up to 10 years. As of December 31, 2004, minimum future lease payments under such leases are as follows (in 000's):
Year ended December 31, 2008 compared with the year ended December 31, 2007
Beneficiaries may withdraw all, but generally, not less than all, of their allocated shares of Common Stock at any time by providing written notice to the Custodian.
IBNR reserves represent the largest component of reserves estimated for claims and benefits payable in our Medical line of business, and we use a number of methods in their estimation, including the loss development method and the projected claim method for recent claim periods. Under the loss development method, we estimate ultimate losses for each incident period by multiplying the current cumulative losses by the appropriate loss development factor. Under the projected claim method, we use ultimate loss ratios when development methods do not provide enough data to reliably estimate reserves. We use several methods in our Medical line of business because of the limitations of relying exclusively on a single method.
Acquisition costs relating to individual medical contracts issued prior to 2003 and in a limited number of jurisdictions are deferred and amortized over the estimated average terms of the underlying contracts. These acquisition costs relate to commissions and policy issuance expenses. Commissions represent the majority of deferred costs and result from commission schedules that pay significantly higher rates in the first year. The majority of deferred policy issuance expenses are the costs of separately underwriting each individual medical contract.
Cash flows from operating activities were $8.0 million and $4.3 million for 1998 and 1997, respectively. Cash flows from operations consist primarily of subscriber premiums and affiliated practice revenue net of capitation payments to panel dentists, claims paid, brokers' and agents' commissions, general and administrative expenses, and income tax payments. The Company receives some premium payments in advance of anticipated capitation payments and claims and invests cash balances in excess of current needs in interest-bearing accounts.
The consolidated financial statements of the Company for the fiscal year ended December 31, 1998 are set forth on pages through herein.