Insurance Underwriting actively conducts business in 17 states. In 2011, production in the following states represented 85.9% of the Company's gross premiums written: Florida (46.5%), Illinois (11.6%), Texas (8.7%), California (7.2%), Nevada (6.4%) and Colorado (5.5%).
The Insurance Services service fee and commission income increased 143.1% to $31.6 million for the year ended December 31, 2011 compared with $13.0 million for the year ended December 31, 2010. This increase was primarily driven by the inclusion of ARS for the full year of 2011 following its acquisition effective June 30, 2010. See Note 4, "Acquisitions" to the Consolidated Financial Statements for further details of the ARS acquisition.
Other income not allocated to segments was $0.3 million in 2011 compared to $3.5 million in 2010. The decrease was primarily related to a $2.9 million decline in gains from foreign currency translation due to the Company's reduced net asset base in Canada following the Jevco transaction combined with a smaller relative move in 2011 than in 2010 in the value of the Canadian dollar versus the U.S. dollar.
We incurred a goodwill impairment charge of $2.8 million in the fourth quarter of 2011 resulting from our annual review of goodwill recoverability. Based on our assessment, we concluded that the carrying value of the Itasca acquisition goodwill exceeded its fair value. See Note 10, "Goodwill and Intangible Assets" to the Consolidated Financial Statements for further details.
For the year ended December 31, 2010 (in millions of dollars)
In 2011, the majority of the unfavorable development occurred on the non-standard automobile line of business and primarily relates to business written at Mendota and Amigo. The adverse development is generally the result of ongoing analysis of recent loss development trends. Original estimates are increased or decreased as additional information becomes known regarding individual claims.
On January 29, 2004, KAI completed the sale of $100.0 million 7.50% senior notes due 2014. The notes are fully and unconditionally guaranteed by the Company. In March 2004, an additional $25.0 million of these senior notes were issued. The notes are redeemable at KAI's option in whole at any time or in part from time to time on or after February 1, 2009, subject to the conditions stated in the trust indenture. Interest paid during the year was $3.3 million for 2011 and $6.1 million for 2010.
On July 10, 2007, a general partnership of the Company, Kingsway 2007 General Partnership, issued C$100.0 million Senior Unsecured Debentures at 6% due on July 11, 2012. These debentures bear interest at a fixed rate of 6% per annum payable semi-annually from the date of issuance until July 11, 2012. Interest payments are to be made on January 10 and July 10 of each year, commencing January 10, 2008. The net proceeds to the Company amounted to C$99.2 million. Kingsway 2007 General Partnership may redeem the debentures in whole at any time and in part from time to time at the issuer's option. The debentures are unconditionally guaranteed by the Company and KAI.
On July 14, 2005, KLROC Trust completed its public offering of C$78.0 million of 5.00% LROC preferred units due June 30, 2015 of which the Company was a promoter.
The table below details the components of accumulated other comprehensive income, net of tax, at December 31, 2011 and 2010:
The Company is engaged, through its subsidiaries, in the non-standard property and casualty insurance business. The Company conducts its business through the following two reportable segments: Insurance Underwriting and Insurance Services.
The Company had a syndicate letter of credit facility which was used to collateralize reinsurance balances. The letter of credit facility was terminated in 2010.