felanders/preprocessed huggingface dataset:
On June 13, 2001, Pumpkin entered into a three-year loan agreement with LaSalle Business Credit, Inc. The total credit facility is $10,000,000, consisting of a term loan amount of $2,500,000 and a revolving loan commitment of $7,500,000. The amount Pumpkin is allowed to draw on the revolver is limited by a borrowing base determined by specific accounts receivable and inventory levels. The agreement also provides for seasonal overadvances from April 1st through July 31st of each year during the peak of the inventory build-up period. On June 14, 2001, Pumpkin used the new financing facility to retire all amounts owing to Banc of America Commercial Finance Corporation ($3,247,001, including $900,000 to repurchase the full amount of outstanding warrants) and to pay the closing costs of the refinancing of $100,000.
The Company sponsors defined contribution 401(k) plans at each of its subsidiaries for which qualifying employees of the Company may participate. Employees must be 21 years of age to
The provision (benefit) for income taxes for the years ended December 31 is as follows:
Approximately 43% and 35% of Pumpkin's gross sales during 2001 and 2000, respectively, were to their three largest customers. Pumpkin purchased approximately 47% and 50% of its supplies from two companies during 2001 and 2000, respectively. The loss of any of its three largest customers or either of its two largest suppliers could have an adverse effect on Pumpkin's future operating results and financial condition.
The Company refinanced its debt at Primrose on April 5, 2002. The terms of the new debt are as follows: $3,200 term loan repayable at $624 per quarter beginning July 15, 2002 bearing interest at an interest rate of prime plus 2.0%, an additional $4,000 of non-amortizing term debt with a balloon payment due in September 2003 bearing interest at LIBOR plus 1.0% and a revolving facility of $1,000 (of which $681 was drawn at closing) bearing interest at LIBOR plus 3.0% or Prime plus 0.5% expiring in September 2003. To secure this debt, Primrose has pledged all of its assets, Primrose Holdings and the Company has guaranteed the debt and the Chairman of the Company has issued a personal guarantee for $4,000, for which he will receive a guarantee fee of 8% per annum of the declining average quarterly balance of his guarantee. This fee has been approved by both the Audit Committee and the Board of Directors. This guarantee entitles the Chairman to a subordinated interest in Primrose's assets, and Primrose agrees to reimburse the Chairman for any amount paid by him on this guarantee. In addition, the Company agrees to reimburse the Chairman for any amount paid by him on his guarantee in the event Primrose fails to reimburse him. The Company will use its best efforts to relieve the Chairman of his personal guarantee through the Company's setting aside of funds in a designated reserve bank account.
Maturities of long-term debt and other obligations for the next five years, reflective of the above refinancings which occurred subsequent to December 31, 2001, are as follows:
December 31, --------------------------------------------- 2002 2001 2000 Interest $ 9,357 $ 32,595 $ 43,667 ----------- ----------- ----------- Net Income $ 23,409 $ 32,595 $ 43,667 =========== =========== =========== Total Assets $ 1,722,546 $ 1,076,262 $ 1,043,667 Shareholders' Equity 1,249,671 1,076,262 1,043,667 Dividends Paid 0 0 0
BALANCE, at December 31, 2002 $1,249,671 $99,671 $1,000,000 $150,000 ========== ========= ========== =========
The Company is authorized to issue an unlimited number of shares of one class without par value to be designated common shares and 30,000 shares of one class without par value to be designated participating shares. During 2002, the Company issued 600 shares to six individuals for $150,000.
(i) a ceding commission which is equal to the amount of such premiums multiplied by 26.5%, reduced by the amount of certain service fees paid to MIC;
A contingency is an existing condition that involves a degree of uncertainty that will ultimately be resolved upon the occurrence of future events. Under U.S. GAAP, reserves for contingencies are required to be established when the future event is probable and its impact can be reasonably estimated. An example is the establishment of a reserve for losses in connection with an unresolved legal matter. The initial reserve reflects management’s best estimate of the probable cost of ultimate resolution of the matter and is revised accordingly as facts and circumstances change and, ultimately, when the matter is brought to closure. In situations in which the Company is to be indemnified by Skandia, there will be no financial impact on the Statements of Operations and Comprehensive Income.
Net income increased $338.0 million from $83.6 million in 2009 to $421.6 million in 2010. The gain is driven by a $513.1 million increase in income from operations before income taxes, as discussed below, partially offset by a $175.1 million increase in income tax expense.
Earnings from discontinued operations, net of income taxes, was $1.8 million in 1997, compared to $.9 million in 1996, an increase of $.9 million. This change is due primarily to a contract entered in June 1996 with the State of Maryland's workers' compensation insurance fund.
The decrease in management fees from OmniCare-TN of approximately $1.7 million (12%) was due to: (i) a 29% decrease in enrollment from approximately 62,800 members at June 30, 1995 to approximately 48,200 members at June 30, 1996 as a result of the Bureau of TennCare's decisions to terminate coverage for Working Uninsured who were delinquent in the payment of premiums to the State under the TennCare program and to terminate approximately 3,400 members in April 1996 from whom questionnaires sent by TennCare were returned undeliverable. The net effect of these enrollment adjustments was a decrease in management fees of $4.6 million; (ii) the change in the net management fee percentage charged to the Plan decreased the management fees due to the Company by approximately $4.3 million, and (iii) a $3.4 million decrease in management fee due to post-acquisition consolidation; offset by (a) an approximate $1.9 million increase in management fees due to TennCare's increase in premium rates, and (b) the Plan's decision to reimburse the Company approximately $8.7 million in June 1996 for the start-up and other costs incurred by the Company between January 1994 and September 1995.
OmniCare-LA and a $1.0 million capital contribution to OmniCare-LA, and a $2.1 million capital contribution to PhilCare, in satisfaction of applicable statutory requirements. In addition, the Company funded $4.1 million on behalf of OmniCare of Georgia, Inc. in satisfaction of applicable reserve and net worth requirements. The foregoing funds were provided by the Company from the line of credit arrangement. In October 1996, the Company withdrew its HMO licensure application from Georgia, along with the $4.1 million used to fund the statutory reserve requirements. The Company anticipates additional funding requirements for its initiatives in Louisiana and Pennsylvania to approximate an aggregate amount of $7 million, and to be applied toward the establishment of statutory reserves and payment of operational costs. There can be no assurance that the Company will fund these requirements. The source for these funding requirements is anticipated from third party investors and borrowings.
The Company's revenues are seasonal, and have tended to be highest in the second and third quarters of each year. This is due primarily to the seasonality of the size of the workforce employed by the Company's agribusiness clients.
OTHER INCOME. Other income increased $0.1 million to $1.0 million for 1997 from $0.9 million for 1996.
Prior to the initial public offering, the Company was obligated under the terms of its ESOP to repurchase shares allocated to ESOP participants when the participants qualified for a distribution (i.e., retirement or break in service) in the event the participants choose to sell such shares and the ESOP was unable to repurchase the shares directly (see note 9). This obligation was eliminated upon completion of the initial public offering as the stock is now publicly traded.
Stock options vest either immediately or over periods not to exceed five years and carry an exercise price equal to or in excess of the fair market value of the common stock on the date of grant. The stock options are exercisable for a ten-year term.
Our commissions and fees revenue are comprised of commissions paid by insurance companies and fees paid directly by customers. Commission revenues generally represent a percentage of the premium paid by the insured and are materially affected by fluctuations in both premium rate levels charged by insurance companies and the insureds’ underlying “insurable exposure units,” which are units that insurance companies use to measure or express insurance exposed to risk (such as property values, sales and payroll levels) so as to determine what premium to charge the insured. These premium rates are established by insurance companies based upon many factors, including reinsurance rates, none of which we control. Beginning in 1986 and continuing through 1999, commission revenues were adversely influenced by a consistent decline in premium rates resulting from intense competition among property and casualty insurance companies for market share. Among other factors, this condition of a prevailing decline in premium rates, commonly referred to as a “soft market,” generally resulted in flat to reduced commissions on renewal business. The effect of this softness in rates on our commission revenues was somewhat offset by our acquisi­tions and net new business production. As a result of increasing “loss ratios” (the comparison of incurred losses plus adjustment expense against earned premiums) of insurance companies through 1999, there was a general increase in premium rates beginning in the first quarter of 2000 and continuing into 2003. During 2003, the increases in premium rates began to moderate, and in certain lines of insurance, the premium rates decreased. We expect the softening of insurance premium rates to continue through 2005.
The Brokerage Division markets and sells excess and surplus commercial insurance and reinsurance, primarily through independent agents and brokers. Like the Retail and National Programs Divisions, essentially all of the Brokerage Division’s revenues are commission-based.
The results of operations for the acquisitions completed during 2004 have been combined with those of Brown & Brown since their respective acquisition dates. If the acquisitions had occurred as of January 1, 2003, Brown & Brown’s results of operations would be as shown in the following table. These unaudited pro forma results are not necessarily indicative of the actual results of operations that would have occurred had the acquisitions actually been made at the beginning of the respective periods.
Summarized financial information concerning Brown & Brown’s reportable segments is shown in the following table. The “Other” column includes any income and expenses nor allocated to reportable segments and corporate-related items, including the inter-company interest expense charge to the reporting segment.
The Company's mortgage loan portfolio, which constitutes 2.8% of invested assets at December 31, 1995, has historically been composed of small residential loans in Texas. At December 31, 1995, one mortgage loan was in default with a principal balance of approximately $92,000. During 1995, the loan to an affiliate described below was foreclosed. At December 31, 1994, two mortgage loans were in default; one to an affiliate of the Company, Continental Investors Life Insurance Company, in
(2) The greater of the applicable Federal interest rate or the prevailing state assumed interest rate which is the highest assumed interest rate permitted by 26 states for computing reserves of a life insurance or an annuity contract at the time the contract is issued; and
In Life Insurance, as a result of the improvement in economic conditions, new business has increased considerably while the number of surrenders shows a marked decline. The
Life DepL. Premium Reserve from 1935 Annuity Fund from 1935 Reserve for Unsettled Claims from 1935 Premiums, less cancellations Portfolio premiums . .... Consideration for Annuities Interest Interest, after deduction of interest due to Life Dep^ Profit on Investments
Premium Reserve Frs. 62,386,141. — Reserve for Unsettled Claims , 85,407,302. — Reserve for Extraordinary Losses . „ 10,000,000. - 157,793,443 —
Reinsurance premiums ceded. Reinsurance premiums ceded for alternative risk products for the year ended December 31, 2004 were $26.8 million compared to $58.4 million for the year ended December 31, 2003, a decrease of 54.1%. The majority of the premium ceded relates to our quota share and aggregate stop loss agreements with Grand Central Re. As a result of Grand Central Re not accepting any new business in 2004, there has been a decline in premiums ceded. The increase of premiums ceded in 2003 is the result of an amendment to the quota share percentage ceded to Grand Central Re in the 2003 year compared to the 2002 year.
Net gains on alternative investments. Net gains on the alternative investment portfolio were $81.6 million, including a loss of $8.1 million from our private equity reinsurance investments, for the year ended December 31, 2004 compared to $124.0 million, including a gain of $12.1 million from our private equity reinsurance investments, for the year ended December 31, 2003. Returns in the investment markets were closer to long-term historic averages in 2004, with the Standard & Poors 500 Index up 10.87% in 2004 compared to 28.67% in 2003. Interest rates and credit spreads were relatively stable for the full year 2004. These market conditions resulted in a return of 9.81% for our Max Re Diversified fund of funds in 2004 compared to a return of 16.67% in 2003. In addition, we had a (11.06%) return from our private equity reinsurance investments in 2004 compared to a return of 15.81% in 2003. The decrease was principally attributable to losses from hurricanes Charley, Frances, Ivan and Jeanne through our investment in Da Vinci.
The cash flows from operations are net of investments in and appreciation of alternative assets of $288.1 million during the year ended December 31, 2004 compared to $178.6 million during the year ended December 31, 2003. We used $6.6 million for financing activities, principally for the payment of dividends. The net cash generated from operating and financing activities was applied to our investing activities through the net purchase of $557.0 million of fixed maturity investments. We believe that we currently maintain sufficient liquidity to cover existing requirements and provide for contingent liquidity.
In the ordinary course of business, we are required to provide letters of credit or other regulatory approved security to certain of our clients to meet contractual and regulatory requirements. We have three letter of credit facilities as of December 31, 2004 providing $370.0 million of aggregate letter of credit capacity. Each of our letter of credit facilities requires that we comply with certain covenants, including a minimum consolidated tangible net worth and restrictions on the payment of dividends. We were in compliance with all the covenants of each of our letter of credit facilities at December 31, 2004. Additional information regarding our letter of credit facilities is set forth in note 15 of the audited consolidated financial statements attached hereto.
The Fire branch has borne the brunt of the "Betsy" ca­ tastrophe loss. Accordingly it closes with a large deficit. As yet reinsurers have hardly felt the benefit of the cor­ rective measures instituted in certain markets; moreover, in far too many territories the shortcomings described in earlier reports have still been in no way remedied. With the exception of a few countries, business passed to us by our European ceding companies has therefore again been unsatisfactory. The bulk of the loss stems from Germany, Switzerland and France. Fires in large industrial risks are once more greatly responsible for the situation remaining disappointing. The overseas territories dealt with direct from Zurich produced a small surplus.
Common Shares of Public Utility, Industrial, Railway and other Companies 125,181,000 125,448,000
North American Reassurance Company 1923 Life 161 East 42nd Street, New York, N. Y. 10017 * with Offices in Atlanta, Chicago, Dallas and San Francisco
See Index to Consolidated Financial Statements and Schedules on page hereof. There is also incorporated by reference herein in response to this Item the material under the caption "Selected Quarterly Financial Data (unaudited)" on page 54 of the 1997 Annual Report, which material is included as part of Exhibit 13 to this Form 10-K.
From December 31, 2001 to December 31, 2002 there was a decrease of $882 million in total assets from $22.093 billion to $21.211 billion. Separate account assets declined $2.224 billion mainly from market value declines. Fixed maturities increased by $1.133 billion from investing policyholder deposits and unrealized market gains. Reinsurance recoverable increased by $92 million due to growth in reinsurance activity for the transferred Taiwan business and domestic term and variable life insurance. Cash and cash equivalents increased $62 million from increased securities lending activities.
The following table sets forth the composition of our fixed maturity securities portfolio by industry category as of the dates indicated and the associated gross unrealized gains and losses.
We believe that cash flows from operating and investing activities of our insurance, annuity and guaranteed products operations are adequate to satisfy liquidity requirements of these operations based on our current liability structure and considering a variety of reasonably foreseeable stress scenarios. The continued adequacy of this liquidity will depend upon factors including future securities market conditions, changes in interest rate levels and policyholder perceptions of our financial strength, which could lead to reduced cash inflows or increased cash outflows. As of December 31, 2002 and 2001, on a consolidated basis, we had cash and short-term investments of approximately $650.5 million and $589.8 million, respectively, and fixed maturity investments classified as "available for sale" with fair values of $5.158 billion and $4.025 billion at those dates, respectively.
Excluding the effects of a write down of intangible assets during the year ended December 31, 2001, operating income, net income after tax, and basic and diluted earnings per share would have been $18.5 million, $13.2 million, and $1.35, respectively.
The consolidated financial statements as of December 31, 2000, 2001 and for the period January 1, 2002 through February 28, 2002, have been carved out from the consolidated financial statements of Ambassadors using the historical operating results and historical bases of the assets and liabilities of Ambassadors’ business of which the Company was comprised. Accordingly, the historical financial information presented herein does not necessarily reflect what the Company’s financial position, operating results and cash flows would have been had the Company been a separate, stand-alone entity during the periods presented (see Notes to Consolidated Financial Statements, Note 1).
sensitivity analysis performed for our Casualty and Specialty segment, discussed in greater detail below. In general, our reserve for claims and claim expenses for more recent events are subject to greater uncertainty and, therefore, greater variability and are likely to experience material changes from one period to the next. This is due to the uncertainty as to the size of the industry losses from the event, which contracts have been exposed to the catastrophic event and the magnitude of claims incurred by our clients. As our claims age, more information becomes available and we believe our estimates become more certain, although there is no assurance this trend will continue in the future. As a result, the sensitivity analysis below is based on the age of each accident year, our current estimated incurred claims and claim expenses for the catastrophic events occurring in each accident year, and a reasonable range of possible outcomes of our current estimates of claims and claim expenses by accident year. The impact on net income and shareholders’ equity assumes no increase or decrease in reinsurance recoveries, loss related premium or redeemable noncontrolling interest - DaVinciRe.
The majority of the balance we have accrued as recoverable will not be due for collection until some point in the future. The amounts recoverable ultimately collected are open to uncertainty due to the ultimate ability and willingness of reinsurers to pay our claims, for reasons including insolvency and elective run-off, contractual dispute and various other reasons. In addition, because the majority of the balances recoverable will not be collected for some time, economic conditions as well as the financial and operational performance of a particular reinsurer may change, and these changes may affect the reinsurer’s willingness and ability to meet their contractual obligations to us. To reflect these uncertainties, we estimate and record a valuation allowance for potential uncollectible reinsurance recoverables which reduces reinsurance recoverables and net income.
The most significant events affecting our financial performance during 2018, on a comparative basis to 2017, include:
Included in our underwriting results for 2018 were the 2018 Large Loss Events, which had a net negative impact on our underwriting result of $340.2 million and added 18.6 percentage points to the combined ratio, partially offset by changes in the estimates of the 2017 Large Loss Events, which had a positive impact on the underwriting result of $157.8 million and reduced the combined ratio by 8.0 percentage points. In addition, as a result of the Q4 2018 California Wildfires, the Company’s underwriting result was negatively impacted by certain casualty liability exposures within the Casualty and Specialty segment. In comparison, in 2017 the underwriting result experienced a net negative impact of $989.2 million, or an increase in the combined ratio of 59.4 percentage points, associated with the 2017 Large Loss Events;
impairment at the reporting unit level annually in the fourth quarter. Goodwill of a reporting unit also is tested for impairment on an interim basis in addition to the annual evaluation if an event occurs or circumstances change which would more likely than not reduce the fair value of a reporting unit below its carrying amount.
Higher asset fees were due to changes in the market value of the investment options underlying the account values, which followed the general upward trends of the equity markets.
Life insurance policies are less susceptible to withdrawal than annuity products because policyholders generally must undergo a new underwriting process and may incur a surrender fee in order to obtain a new insurance policy.
On April 30, 1998, the Company acquired the business of two Florida-based insurance agencies, Villari & Associates, Inc. and National Support Systems, Inc. (collectively referred to as "Villari"). Villari offers professional liability products and programs, group health and disability, and property/casualty products.
The insurance subsidiaries are required to maintain certain deposits with regulatory authorities which totaled $24.1 million at December 31, 1998, and $17.6 million at December 31, 1997.
Insurance operations are subject to various leverage tests (e.g. premium to statutory surplus ratios) which are evaluated by regulators and rating agencies. The Company has recently changed its objective to maintain a gross written premium to statutory surplus at or below 3 to 1 to at or below 4 to 1. This change reflects the impact of both the fronting and risk sharing program business in comparison to the composition of a traditional MEADOWBROOK INSURANCE GROUP, INC.
The Company provides alternative risk management programs and services to certain large client groups and associations and then markets them to their individual members. In 1998, and in 1997, the Company's top four programs, excluding the surety bond business, accounted for 38% and 46%, respectively, of the Company's total revenue on an actual basis. The loss or cancellation of any of the Company's significant
The selected statements of operations and balance sheet data set forth below are derived from audited financial statements of the Company. The information set forth below should be read in conjunction with the Company's audited consolidated financial statements and notes thereto. See Item 8 "Financial Statements and Supplemental Data" and
As a result of the uncertainty over the future of the Company's extended warranty and service contract business the Company recorded an impairment charge of $305,333 in the fourth quarter of 2001. This charge represented the unamortized balance of capitalized software.
At December 31, 2003, Wesco’s consolidated cash and cash equivalents totaled $1.1 billion, up from $350 million at December 31, 2002. The $703 million increase resulted primarily from sales, maturities and early redemptions of longer-term fixed-income securities as well as operating cash flow from Wesco’s insurance businesses.
Wesco’s management believes the group has adequate liquidity and capital resources to provide for contingent needs. Borrowings from banks and others have been available to Wesco and its subsidiaries under attractive terms for a number of years. Wes-FIC enjoys Standard & Poor’s Corporation’s highest rating, AAA, with respect to its claims-paying ability.
Industrial segment revenues for 2003 decreased 5.0% from the corresponding 2002 figure; pounds of steel products sold decreased 6.6%. Revenues for 2002 increased .3% from the corresponding 2001 figure; pounds of steel products sold increased 6.6%. The increase in steel sales in terms of pounds sold in 2002 may have been anomalous, because in recent years Precision Steel has suffered from a prolonged economic downturn, a shift by many manufacturers from domestic to overseas production facilities, periodic shortages of product from domestic mills, and extraordinary competitive pressures. Not only has there been a reduction in the number of orders placed, but there has also been a trend towards smaller-sized orders. The severity of these adverse factors on industrial segment revenues is demonstrated by the fact that average annual segment revenues for the years 2001 through 2003 were down 27% from those reported for 1998 through 2000.
Certain written or oral representations of management stated in this annual report or elsewhere constitute “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995, as contrasted with statements of historical fact. Forward-looking statements include statements which are predictive in nature, or which depend upon or refer to future events or conditions, or which include words such as expects, anticipates, intends, plans, believes, estimates, may, or could, or which involve hypothetical events. Forward-looking statements are based on information currently available and are subject to various risks and uncertainties that could cause actual events or results to differ materially from those characterized as being likely or possible to occur. Such statements should be considered judgments only, not guarantees, and Wesco’s management assumes no duty, nor has it any specific intention, to update them.
The increase in total assets under management was primarily attributable to sales of floating rate funding agreements and certificates to institutional customers and retail variable fund options and the investment performance of variable fund options due to strong stock market returns. The Company manages the mix of its business by monitoring various economic factors and responding to market opportunities as they present themselves. This approach, which may produce changes in the mix of business from one reporting period to the next, is intended by management to enhance the Company's long-term profitability. In addition, the Company's product mix is impacted by current market conditions, actions of rating agencies and other competitive factors.
Realized investment gains, which are reported net of related amortization of deferred policy acquisition costs and value of insurance in force, were $3.2 million in 1997 compared to $0.9 million in 1996. Realized investment gains in 1997 include an estimated loss of $4.0 million related to the write-down to fair value of an investment in a fixed income security. Realized investment gains in 1996 include an estimated loss of $15.2 million related to the write-down to fair value of an investment in a fixed income security and a gain of $4.5 million, before selling expenses, related to the transfer of the State Bond Mutual Funds management contracts. Other realized investment gains and losses were primarily interest-rate related and attributable to the ongoing management of the Company's fixed maturity securities classified as available-for-sale which can result in period-to-period swings in realized investment gains and losses since securities are sold during both rising and falling interest rate environments.
losses and (iii) enhance yield through sector rotation and security selection. In addition, the Company aims to generate and maintain liquidity from scheduled interest and principal payments, projected prepayments and early calls, cash on hand, floating rate securities and lines of credit (but not from new product sales), sufficient presently to cover approximately two times expected cash needs (for benefits and withdrawals for general account retail spread products, expenses and dividends) without having to sell any investments at a material loss.
During 1998, the Company purchased an interest rate cap for $5.2 million, having a notional amount of $1.0 billion. The objective for holding the instrument is to limit the Company's exposure to higher market interest rates in connection with its payment of interest credited on variable rate institutional spread deposits.
Income from our investments is primarily comprised of interest income, dividends and net realized and unrealized gains (losses) on investment securities. Such income is primarily from the Company’s investments, which includes investments held in trust accounts that collateralize the reinsurance policies that we write. The investment parameters for trust accounts are generally be established by the cedant for the relevant policy.
Our reserving methodology does not lend itself well to a statistical calculation of a range of estimates surrounding the best point estimate of our reserve for loss and loss adjustment expense. Due to the low frequency and high severity nature of claims within much of our business, our reserving methodology principally involves arriving at a specific point estimate for the ultimate expected loss on a contract-by-contract basis, and our aggregate loss reserves are the sum of the individual loss reserves established.
Life DepL. Retrocession Premiums Retrocession on annuities . . ... Commissions and expenses, less retrocession Surrenders, less retrocession Losses paid, less retrocession Annuities paid, less retrocession . . . . Premium Reserve Annuity Fund . Reserve for outstanding losses .... . Expenses of management ........ Taxes Amortisation on Securities . . . . . . Net profit . . .
(6) Consolidated statements of cash flows - for each of the three years in the period ended December 31, 1997.
Direct expenses consist principally of marketing and processing fees and the cost of benefits provided to program members. Direct expenses are a function of the level of membership during the period and the specific set of program features selected by members. The coverage obligations of our benefit suppliers and the related expense are determined monthly, as are the remaining direct expenses.
The Company carries the value of goodwill on its books at historical values. In the future, the Company will subject these historical values to the impairment testing required under FASB Statement No. 142 (described below). The Company intends to complete its initial impairment test no later than June 30, 2002.
If we do not effectively manage and integrate our acquistion of Catalyst our business prospects could be damaged - --------------------------------------------------------------------------------
If the providers of the benefits included in our programs fail to provide those benefits, we could become subject to liability claims by our program members - -----------------------------------------------------------------------------
Deposits for investment-type contracts increased $17.3 million in 2000 when compared to 1999, primarily due to BOLI deposits of $20.0 million in 1999 compared to $37.3 million in 2000. Deposits for investment-type contracts decreased $42.5 million in 1999 when compared to 1998 due to a single premium of $50.0 million on one case in 1998. BOLI sales are single premium and very large in nature, and therefore, can vary from year to year.
In our opinion, such financial statements present fairly, in all material respects, the financial position of First Great-West Life & Annuity Insurance Company as of December 31, 2000 and 1999, and the results of its operations and its cash flows for the each of the three years in the period ended December 31, 2000, in conformity with accounting principles generally accepted in the United States of America.
Temporary differences, which give rise to the deferred tax assets and liabilities as of December 31, 2000 and 1999, are as follows:
Our book value per share increased 4.0% from $63.31 at December 31, 2016, to $65.87 at December 31, 2017. This increase was primarily due to net earnings partially offset by shareholder dividends and share repurchases.
During each quarterly review by the internal actuarial staff, using the additional information obtained with the passage of time, factor selections are updated, which in turn adjust the ultimate loss estimates and held IBNR reserves for the subset of the business and accident periods affected by such updates. The actuarial staff also performs various tests to estimate ultimate average severity and frequency of claims. Severity represents the average cost per claim and frequency represents the number of claims per auto or per policy. As an overall review, the staff then evaluates for reasonableness loss and LAE ratios by accident year by state, by product and by coverage.
For fixed maturity securities that are other-than-temporarily impaired, we assess our intent to sell and the likelihood that we will be required to sell the security before recovery of our amortized cost. If a fixed maturity security is considered other-than-temporarily
Our Board of Directors previously authorized a share and debt repurchase program. On November 4, 2014, our Board of Directors increased the authority to a total of $75 million and extended the date to execute the program to December 31, 2016, from December 31, 2014. On November 1, 2016, our Board approved the extension of the date to execute the program from December 31, 2016, to December 31, 2017, and on November 2, 2017, approved an extension to December 31, 2018. During 2017 we repurchased 133,306 shares at an average cost, excluding commissions, of $92.54 per share. As of December 31, 2017, we had $22.5 million of authority remaining under this program.
Losses from catastrophes totaled $6.9 million during 2016, compared with $1.8 million in 2015.
The following table reconciles our U.S. statutory rate and effective tax rate for the periods ended December 31, 2017, 2016 and 2015:
Net investment income increased 52.3% to $69.3 million for the year ended December 31, 1997 from $45.5 million for the year ended December 31, 1996. As a percentage of net premiums, net investment income increased to 7.7% for the year ended December 31, 1997 from 4.4% for the year ended December 31, 1996. This increase was primarily attributable to the proceeds of the sale of the Annuity Operations as discussed above.
The Company believes that sufficient sources of cash flow exist which will be available in the foreseeable future to allow the Company to fund operations and to service its debt, redeem preferred stock and meet anticipated dividend requirements. See Notes 6, 12, 13 and 15 to the Consolidated Financial Statements for a discussion of liquidity, quality, composition and fair values of the Company's invested asset portfolio.
Net income ................. $ 10,563,312 $ 344,420 $ 8,971,387 ============ ============ ============
Additional paid-in capital, beginning of year .................... 53,507,459 52,838,624 52,332,954 Additional paid-in capital from issuance of common stock: Stock option plans ................. 279,234 669,320 490,783 Dividend reinvestment plan ......... 1,211,972 - - Gain (loss) on sale of treasury stock .. 23,261 (485) 14,887 ----------- ----------- ----------- Additional paid-in capital, end of year 55,021,926 53,507,459 52,838,624 ----------- ----------- -----------
The effect of reinsurance on premiums written and earned and losses and settlement expenses incurred for the years ended December 31, 1993, 1992 and 1991 is presented below. Amounts for the year ended December 31, 1993 reflect (1) the change in the property and casualty insurance subsidiaries' pooling agreement whereby effective January 1, 1993, the voluntary assumed reinsurance business written by Employers Mutual is no longer subject to cession to the pool members and (2) the change in the reinsurance subsidiary's quota share agreement whereby effective January 1, 1993, losses in excess of $1,000,000 per event are retained by Employers Mutual and the reinsurance subsidiary therefore no longer purchases catastrophe protection (see note 2).
During 1993, Employers Mutual maintained three separate stock option plans which utilize the common stock of the Company. The Company receives the current fair market value for any shares issued under the plans and all costs of the plans are borne by Employers Mutual or the company employing the individual optionees.
Illinois and North Dakota are currently exploring changes to the definition of extraordinary dividends; however, no legislation has been finalized at this time.
- ---- Total revenues ........... $31,545,776 $33,059,727 $34,818,761 $34,261,385 =========== =========== =========== ===========
We have derived the following discussion and analysis of the results of operations for the three years ended December 31, 2005, and our financial condition as of each year-end, from the consolidated financial statements included elsewhere in this document. You should read this discussion and analysis in conjunction with such financial statements.
The decline in the loss ratio was primarily attributable to a reduction in adverse development on loss and LAE reserves for prior years, which was an insignificant amount in 2005 down from $2.5 million in 2004, or 0.8 points of the improvement. Adverse development occurs when loss and LAE reserves established for accidents that took place in years prior to the current year prove to be inadequate and management increases those reserves to reflect the revised estimate of the ultimate losses related to such accidents. Such increases result in a charge to loss and LAE incurred in the current year. The remainder of the decrease in the loss ratio was due to a 0.3 point improvement in our claims experience for accident year 2005 compared to 2004. This improvement occurred despite $2.5 million of pre-tax losses related to Hurricanes Katrina, Rita and Wilma during the twelve months ended December 31, 2005 compared to $1.0 million of pre-tax losses related to Hurricanes Charley, Frances, Ivan and Jeanne during the twelve months ended December 31, 2004.
There are no restrictions on the payment of dividends by our non-insurance subsidiaries other than customary state corporation laws regarding solvency. Dividends from our insurance subsidiaries are subject to limitations based upon statutory surplus and earnings. See "Item 1. Business-Regulatory Matters." As of December 31, 2005, our insurance subsidiaries could pay dividends of $30.6 million without seeking regulatory approval. Our insurance subsidiaries have not paid any dividends since 1999, despite having the ability to do so. Because our non-insurance subsidiaries generate profits that are generally unrestricted as to their availability for the payment of dividends, we expect to use such profits to service our corporate financial obligations.
The following table displays our contractual obligations by the years in which payments are due as of December 31, 2005.
Revenues $ 138,244 $ 122,390 $ 114,842 $ 117,843 $ 139,009
In 1995, Investors-NA entered into a reinsurance agreement with Family Life Insurance Company (an insurance company subsidiary of Financial Industries Corporation and an affiliated company of Investors-NA), pertaining to universal life insurance written by Family Life. The reinsurance agreement is on a co-insurance basis and applies to all covered business with effective dates on and after January 1, 1995. The agreement applies to only that portion of the face amount of the policy which is less than $200,000; face amounts of $200,000 or more are reinsured by Family Life with a third party reinsurer. In 1996, Investors-NA entered into a reinsurance agreement with Family Life, pertaining to annuity contracts written by Family Life. The agreement applies to contracts written on or after January 1, 1996. These reinsurance arrangements reflect management's plan to develop universal life and annuity business at Investors-NA, with Family Life concentrating on the writing of term life insurance products.
Management believes that its cash, cash equivalents and short term investments are sufficient to meet the needs of its business and to satisfy debt service.
First mortgages, Government Securities and Bonds, House Property, Deposits, Cash in Bank and in Hand ... Frs. 20,664,862. 80
We are an industry leader in the sale of STM insurance plans, which provide up to six, eleven or twelve months of health insurance coverage with a wide range of deductible and copay levels. STM plans generally offer qualifying individuals comparable benefits for fixed short-term durations with premiums that are substantially less than the premiums of IMM plans which offer lifetime renewable coverage. STM plans feature a streamlined underwriting process offering immediate coverage options.
On December 15, 2014, we entered into a three-year revolving line of credit (“RLOC”) for $15.0 million with a bank. The purpose of the RLOC is to provide working capital to support our general corporate expenses and to help us maintain adequate liquidity. We have not drawn on the RLOC as of December 31, 2014.
During 2014, cash used in financing activities was primarily attributable to purchases of Series B Membership Interests of $21.0 million, payments made against contingent acquisition consideration of $1.8 million, $1.2 million of distributions to members of HPIH and $304,000 to repurchase shares of our common stock under a share repurchase plan, partially offset by proceeds from a private placement of our Class A common stock of $21.0 million.
In May 2014, the FASB issued an amendment to its accounting guidance related to revenue recognition. The amendment clarifies the principles for recognizing revenue. The guidance is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in the judgments and assets recognized from costs incurred to obtain or fulfill a contract. We will adopt this guidance in reporting periods beginning after December 15, 2017. We are currently evaluating the impact of adopting this pronouncement on our consolidated financial statements.
The following table includes the complete loss development history of the direct gross loss and loss adjustment expense or LAE reserves of Potomac Insurance Company of Illinois (Potomac). Effective January 1, 2004, Potomac entered into a transfer and assumption agreement with its parent company, OneBeacon, which reinsured all its direct liabilities to OneBeacon. Therefore, effective January 1, 2004, Potomac had no net liabilities for unpaid Losses and LAE. On November 23, 2004, we purchased Potomac and subsequently received approval from the Illinois Department of Insurance to rename the company SUA Insurance Company. SUA Insurance Company did not issue any policies in 2004, however, it remains liable for the Loss and LAE reserves generated from its predecessor’s (Potomac’s) direct business should OneBeacon be unable to honor its reinsurance obligation in the future. Those Loss and LAE reserves, including IBNR, totaled $95,959 at December 31, 2004.
We expect that our expenses will consist primarily of loss and loss adjustment expenses, policy acquisition expenses and general and administrative expenses.
Net premiums written will consist of direct premiums written less ceded premiums. The components of net premiums written will be recognized as revenue over the period that coverage is provided. When premium rates increase, the effect of those increases will not immediately affect earned premium. Rather, those increases will be recognized ratably over the period of coverage. Unearned premiums and prepaid reinsurance premiums, which are recorded on the balance sheets, will represent that portion of premiums written that are applicable to the unexpired terms of policies in force.
Our portfolio includes primarily fixed income securities and short-term investments, which are subject to credit risk. This risk is defined as default or the potential loss in market value resulting from adverse changes in the borrower’s ability to repay the debt. In our risk management strategy and investment policy, we plan to earn competitive relative returns while investing in a diversified portfolio of securities of high credit quality issuers and to limit the amount of credit exposure to any one issuer.
Consolidated financial statements of the Corporation at December 31, 1993 and 1992 and for each of the three years in the period ended December 31, 1993 and the auditor's report thereon and the Corporation's unaudited quarterly financial data for the two year period ended December 31, 1993 are incorporated herein by reference from the 1993 Annual Report to Stock-holders, pages 6 through 18 and 21.