felanders/preprocessed huggingface dataset:
portion of our non-investment grade portfolio of fixed maturity investments is primarily comprised of variable rate secured and senior bank loans and high yield bonds. We have no exposure to European sovereign debt.
Losses and Loss Adjustment Expenses. Losses and loss adjustment expenses incurred for the year ended December 31, 2014 increased by $28,617, or 6.4%, to $476,366 from $447,749 for the comparable 2013 period. Our GAAP loss ratio for the year ended December 31, 2014 and 2013 was 66.5% and 65.7%, respectively. Our GAAP loss ratio excluding loss adjustment expenses was 57.8% and 56.5% for the year ended December 31, 2014 and 2013, respectively. Total prior year favorable development included in the pre-tax results for the year ended December 31, 2014 was $37,368, compared to $28,889, for the comparable 2013 period.
Significant periods of time can elapse between the occurrence of an insured loss, the reporting to us of that loss and our final payment of that loss. To recognize liabilities for unpaid losses, we establish reserves as balance sheet liabilities. Our reserves represent estimates of amounts needed to pay reported and unreported losses and the expenses of
Our assumptions consider that past experience, adjusted for the effects of current developments and anticipated trends, are an appropriate basis for establishing our reserves. Our individual key assumptions could each have a reasonable possible range of plus or minus 5 percentage-points for each estimation, although there is no guarantee that our assumptions will not have more than a 5 percentage point variation. The following sensitivity tables present information for each of our primary lines of business on the effect each 1 percentage-point change in each of our key assumptions on unpaid frequency and severity could have on our retained (i.e., direct minus ceded) loss and LAE reserves and net income for the twelve months ended December 31, 2014. In evaluating the information in the table, it should be noted that a 1 percentage-point change in a single assumption would change estimated reserves by 1
Our retained commercial automobile line of business prior year reserves decreased by $2,344 for the year ended December 31, 2014 due primarily to fewer IBNR claims than previously estimated.
ASC 320, Investments - Debt and Equity Securities requires entities to separate an OTTI of a debt security into two components when there are credit related losses associated with the impaired debt security for which the Company asserts that it does not have the intent to sell the security, and it is more likely than not that it will not be required to sell the security before recovery of its cost basis. Under ASC 320, the amount of the OTTI related to a credit loss is
The qualitative analysis performed by the Company concluded that the unrealized losses recorded on the investment portfolio at December 31, 2014 resulted from fluctuations in market interest rates and other temporary market conditions as opposed to fundamental changes in the credit quality of the issuers of such securities. Therefore, decreases in fair values of the Company’s securities are viewed as being temporary.
Pursuant to a required change in accounting policy, the Company capitalized $19.7 and $18.4 million of software development costs (see Note 1 to the consolidated financial statements), which increased the 2000 and 1999 consolidated net income, respectively.
(Millions) Years Ended December 31, -------------------------------------- INCOME STATEMENT DATA 2000 1999 1998 ----------- ---------- ----------
The Company continued to limit sales of GICs and to allow this block of business to contract in response to the highly competitive GIC market. As a result, in 2000, GIC assets decreased 1.7% from 1999, to $103.0 million. GIC assets decreased 62% in 1999, to $104.7 million.
One of the Company's primary objectives is to ensure that its fixed maturity portfolio is maintained at a high average quality, so as to limit credit risk. If not externally rated, the securities are rated by the Company on a basis intended to be similar to that of the rating agencies.
Written premium for the property and casualty insurance was approximately $442 million in 1998, which represents an increase of 1.5% over the approximately $435 million written in 1997. The 1997 writings were 3.3% greater than the approximately $421 million written in 1996.
The Company considers that the effects of inflation are unlikely to be a significant factor in the results of operations given the relatively short term nature of premiums receivable and expected loss payments from
reserves for losses and loss expenses. The anticipated effect of inflation is implicitly considered when estimating reserves for losses and loss expenses, product pricing and investment decisions.
The Company expects continuing positive cash flow from operations. Additionally, the investment portfolios of the Company's insurance operations have been structured to provide liquidity for operations. The portfolios are structured so that on average, approximately $26.7 million of investments mature every year over the next ten years, and are available for reinvestment or use in operations as required. The insurance products written by the Company's insurance subsidiaries are primarily property coverages which result in rapid claims payments. The average maturity of investments is between five and six years, which provides adequate asset/liability matching. The Company believes that its liquid assets plus cash flow from operations will be adequate to meet all foreseeable cash requirements.
above stock repurchase authorizations and purchases have been adjusted for the January 1998 three-for-one stock split. The Company will continue to evaluate the purchase of its common stock from excess capital.
Property and Casualty Statements of Income for the years ended December 31, 1998, 1997 and 1996 28
In accordance with Statement of Financial Accounting Standards (SFAS) No. 115, "Accounting for Certain Investments in Debt and Equity Securities," the Company has classified its investments in fixed maturities and equity securities into two categories, "fixed maturities held to maturity" and "securities available for sale." Fixed maturities held to maturity and mortgage loans and land contracts are reported at amortized cost. The Company expects that the investments in these categories will be held to maturity and, therefore, no unrealized gains or losses are recognized on such investments. Securities available for sale are reported at market value. The unrealized gains and losses of the investments in this category are credited or charged directly to shareholders' equity, net of applicable taxes. Although the Company has the general intent and ability to hold securities segregated as securities available for sale to maturity, the Company may sell such securities due to changes in market conditions, relative yields available, tax planning and asset/liability management considerations.
The Company is in the process of running off the existing VBI medical stop- loss and group term life business in exchange for a management fee from the sellers that was included within the purchase price, and Eureko is providing loss ratio protection for the in-force business being run-off by VBI so that the Insurance Companies will have neither an underwriting gain nor incur an underwriting loss on such business. Under the stock purchase agreement the Company has the right to renew the existing VBI in-force business and will be offering renewal quotations to all accounts in excess of 51 covered employee lives. The Company has made arrangements with an unrelated managing general underwriter to offer coverage to accounts with less than 51 lives and will receive a fee for all such business renewed by the unrelated managing general underwriter. Effective January 1, 1999, Seaboard Life and VNAIC began to reinsure the medical stop-loss and provider excess business, respectively, underwritten by USBenefits on behalf of Continental. USF RE ceased being the reinsurer of such business on a run-off basis as of December 31, 1998.
The medical lines segment is subject to fluctuations in the cost of health care services, changes in the frequency of services provided to the covered population and the expansion of routine medical services
In mid 1998 the infrastructure that was in place to directly service and produce USFIC's business was transferred to a national brokerage firm. This new entity was appointed an exclusive managing general agent and it continues to renew and write new business on behalf of USFIC.
necessary to maintain profit margins. Historically the Company has made no explicit provisions for inflation, but trends are considered when setting underwriting terms and claim reserves. Inflation also affects interest rates, which in turn affect investment income and the market value of the Company's investment portfolio.
partners to determine their extent of compliance and has learned that a variety of operating systems are being used by them. The Company believes that it is unlikely that the failure of one operating system to perform as expected will affect a significant portion of its business partners at any one time.
The key factors causing the increase in net income in the Corporate segment were increased net realized gains for the year ended December 31, 2001 as compared to 2000.
Future contract and policy benefits are liabilities for traditional life, health 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 following illustrates the changes to the deferred policy acquisition cost asset (in 000's):
Effective January 1, 2001, the State of New York required that insurance companies domiciled in the State of New York prepare their statutory financial statements in accordance with the National Association of Insurance Commissioners' ("NAIC") Accounting Practices and Procedures manual, version effective January 1, 2001, subject to any deviation prescribed or permitted by the State of New York Superintendent of Insurance.
The State of New York has adopted certain prescribed accounting practices that differ from those found in the NAIC Accounting Practices and Procedures manual, version effective January 1, 2001. Specifically, paragraphs 5 through 11 and paragraphs 17 through 19 of Statement of Statutory Accounting Principle ("SSAP") No. 10, Income Taxes, were not adopted. In addition, all requirements related to deferred tax assets and deferred tax liabilities in paragraphs 20 and 21 of SSAP No. 10 were not adopted. The impact of not applying SSAP No. 10 in its entirety was a decrease in statutory surplus of $587,279 for the year ended December 31, 2001.
The Company also leases office space in 19 other locations throughout California. The Company anticipates no difficulty in extending these leases or obtaining comparable office facilities in suitable locations.
The following table summarizes certain information pertaining to the Company's financial condition as of or for the year ended December 31,
Realized capital losses on the sale of investments were $0.4 million in 1999 compared to capital gains of $22.6 million for 1998 and $4.1 million for 1997. The 1998 increase in realized gains is primarily due to the Company's decision to begin switching its investment portfolio from taxable to non-taxable securities during 1998 in anticipation of fully utilizing its remaining net operating loss deduction and selling into a declining bond market. At December 31, 1999, $846.3 million of the Company's total investments at fair value were invested in tax-exempt bonds with the balance, representing 14.4% of the portfolio, invested in taxable securities compared to 88.6% at December 31, 1998.
Ordinarily, the Company's principal deferred tax assets arise from the discounting of loss reserves for tax purposes, which delays a portion of the loss deduction, and from the acceleration of 20% of the unearned premium reserve into taxable income before it is earned. During 1999, the
Losses and loss adjustment expenses have been reduced by reinsurance ceded as follows (amounts in thousands):
After December 31, 1999, a castastrophe reinsurance program provides for recoveries of homeowner losses of up to $65 million in excess of a $10 million retention. Because the Company's homeowner policies do not include any earthquake coverage, its principle catastrophe exposure relates to the potential for fire following an earthquake.
Dividends which may be paid by the Company's insurance subsidiaries to the parent company within any one year without the approval of the California Department of Insurance ("CDOI") are subject to restriction. The California Insurance Code provides that amounts may be paid as dividends from earned surplus on an annual, non-cumulative basis, without prior approval by the CDOI, up to the greater of (1) net income for the preceding year, or (2) 10% of statutory surplus as regards policyholders as of the preceding December 31. As of December 31, 1999, the amount of dividends the Company's insurance subsidiaries could declare without prior regulatory approval was approximately $100.1 million.
Total expenses were $101.4 million in 2009 as compared to $100.7 million in 2008. Insurance benefits and losses and commissions and underwriting expenses as a percentage of premiums were 97.5% and 95.9% in 2009 and 2008, respectively. The increase in expenses was primarily due to higher loss ratios in both the property and casualty and the life and health operations discussed above.
Media includes related party investments in Gray Television, Inc. with an amortized cost basis of $3,198 and which had an aggregate carrying value of $718 and $267 at December 31, 2009 and 2008, respectively. See Note 13.
Effective October 28, 2008, the Credit Agreement was amended to allow the Company to redeem all the outstanding shares of the Company’s Series B Preferred Stock, par value $1.00 per share (“Series B Preferred
At December 31, 2009, the qualified defined benefit plan assets (the “Plan Assets”) were invested in the Evergreen Treasury Money Market Fund (the “Evergreen Fund”). The Evergreen Fund invests 100% of its assets in U.S. Treasury securities. The Company’s investment strategy with respect to pension assets is to invest the assets in accordance with ERISA and fiduciary standards. Currently, the Company’s primary investment objective is to preserve the Plan Assets pending government approval to terminate the qualified defined benefit plan and distribute accumulated assets to its employees. The Evergreen Fund does not include any equity securities of the Company in its portfolio at any time.
On October 28, 2008, the Company redeemed all of the issued and outstanding shares of Series B Preferred Stock at the stated value of $100 per share, for an aggregate payment of $13,400. In connection therewith, the Company also paid $1,675 in dividends to the Holders of the Series B Preferred Stock in satisfaction of a portion of the accrued but unpaid dividends on the Series B Preferred Stock through the date of redemption. The Holders of the Series B Preferred Stock agreed to discharge the Company from any obligation to pay the remaining $13,795 of accrued but unpaid dividends on the Series B Preferred Stock and to release the Company from any further obligations thereunder. As a result, the reversal of the $13,795 of accrued but unpaid dividends on the Series B Preferred Stock was recorded as a capital contribution during the fourth quarter of 2008.
In accordance with the provisions of ASC 350, “Goodwill and Other Intangible Assets,” goodwill with a carrying amount of $2,388 was written down to its implied fair value of $2,128 at December 31, 2008 resulting in an impairment charge of $260, which was included in earnings for the year ended December 31, 2008. There were no goodwill impairments in 2009.
For the year ended December 31, 2018, we had net income of $1,581,542, which consists of operating costs of $668,087 and a provision for income taxes of $420,000, offset by interest income of $2,687,003, and an unrealized loss on marketable securities held in our Trust Account of $17,374.
In March 2018, the Company entered into an Administrative Services Agreement pursuant to which it pays its Sponsor, an affiliate of our Executive Chairman and our Chief Executive Officer, a total of $10,000 per month for office space, utilities and secretarial support. Upon completion of our initial Business Combination or liquidation, the Company will cease paying these monthly fees.
Fee revenues increased by $12.2 million or 10% in 1994. This increase, generated primarily by Gallagher Bassett Services, Inc., resulted from strong new business production of $20.5 million and increases in existing business partially offset by lost business. Fee revenues increased by $16.7 million or 15% in 1993. This increase, again generated primarily by Gallagher Bassett Services, Inc., resulted from strong new business production of $19.9 million and increases in existing business partially offset by lost business.
Investment income and other decreased by $6.9 million or 42% in 1994. This decrease is due primarily to a combination of significantly lower returns on funds invested with outside fund managers and lower levels
(a) As discussed in Note 2 to the consolidated financial statements, White River adopted the provisions of Statement of Financial Accounting Standards ("SFAS") No. 115, "Accounting for Certain Investments in Debt and Equity Securities", effective September 30, 1995.
Selected consolidated statement of financial condition data as of December 31, 1996, 1995, 1994 and 1993 follows:
(c) The calculation of book value per common and common equivalent share reflects the potentially dilutive effects of White River's outstanding incentive and directors' compensation awards. See Note 2 to the consolidated financial statements.
Since the passage of the Airline Deregulation Act of 1978, the airline industry has been characterized by strong competition and industry consolidation. A number of airlines have filed for bankruptcy and/or ceased operations. Airlines offer discount fares, a wide range of schedules, frequent flyer mileage programs, and ground and in-flight services as competitive tools to attract passengers and increase market share. Because of the relative ease with which U.S. carriers can enter new markets, each carrier's domestic service is subject to potential increases in competition from other air carriers, the extent and effect of which cannot be predicted. The airline industry is subject to substantial price competition as U.S. carriers are free to determine domestic pricing policies without government regulation. Domestic price competition has accelerated the efforts of airline management to reduce costs and improve productivity. Although the U.S. government retains authority over international fares, such fares are also subject to the jurisdiction of the foreign countries being served. For these reasons, among others, White River's management believes that the value of its interest in NWA Partners may be subject to additional price volatility not applicable to the securities markets in general.
Until August 1994, CCC, through various subsidiaries and related businesses ("Faneuil"), provided customer satisfaction surveys, credit card registration, telemarketing sales and research, computer time-sharing and certain related activities. During August 1994, CCC sold Faneuil to a group of investors, which includes members of Faneuil management (including a former CCC director), for net cash and other consideration of $6.2 million. On a stand-alone basis, CCC reported a $3.6 million gain from discontinued operations, net of income taxes, as a result of the sale of Faneuil. For purposes of White River's consolidated financial statements, such gain was reflected during the year ended December 31, 1994, as a reduction of the goodwill recorded by White River upon the acquisition of CCC.
The following table shows the ratio of IBNR reserves to total reserves net of reinsurance recoverables as of December 31, 2018 (dollars in thousands):
The following table displays ultimate net loss and LAE and net loss and LAE reserves by accident year for the year ended December 31, 2018. We applied the sensitivity factors to each accident year amount and have calculated the amount of potential net loss and LAE reserve change and the impact on 2018 reported pre-tax income and on net income and shareholders’ equity at December 31, 2018. We believe it is not appropriate to sum the illustrated amounts as it is not reasonably likely that each accident year’s reserve estimate assumptions will vary simultaneously in the same direction to the full extent of the sensitivity factor. We also believe that such changes to our reserve balance would not have a material impact on our operating results, financial position, or liquidity. The net income and shareholders' equity amounts include an income tax rate assumption of 21%. The dollar amounts in the table are in thousands.
Investing Activities. Cash provided by investing activities for the year ended December 31, 2018, was $12.2 million as compared to $26.0 million used in investing activities for the same period in 2017. The increase in funds provided by investing activities was due to a decrease in funds available to be invested in our investment portfolios in the insurance subsidiaries as cash collections decreased and paid losses increased from operating activities.
Favorable loss development of $0.4 million on a 2008 multi-line frequency quota share contract, net of retrocession, based on loss data received from the client and our quarterly reserve analysis.
· Favorable loss development of $0.7 million on a 2008 severity medical malpractice contract based on our quarterly reserve analysis;
Investments reported on our consolidated balance sheet as of December 31, 2010 were $1,052.0 million compared to $830.6 million as of December 31, 2009, an increase of $221.4 million, or 26.6 %. The increase in investments was due to an investment gain of 11.0% for the year ended December 31, 2010, and cash flows from our underwriting operations used to purchase investments. For the year ended December 31, 2010, our exposure to long investments increased from 85% as of December 31, 2009, to 93% as of December 31, 2010, while our exposure to short investments increased from 65% as of December 31, 2009 to 73% as of December 31, 2010. This exposure analysis is conducted on a notional basis and does not include cash (U.S. dollar and foreign currencies), gold, CDS, foreign exchange options or interest rate options. The increase in our long exposure was in part facilitated by utilizing unrestricted cash, and was in part facilitated by utilizing leverage. From time to time, we incur indebtedness to our prime brokers to implement our investment strategy in accordance with our investment guidelines. At December 31, 2010, we had borrowed $54.4 million from our prime brokers in order to purchase investment securities and $218.7 million under a term margin agreement from a prime broker to provide collateral for our letters of credit outstanding.
writings to us monthly or quarterly (depending on the contract). We book the actual premiums written when we receive them from our client. Each reporting period we estimate the premiums written for stub periods that have not yet been reported to us by the client. For example, at year-end we may have to estimate December premiums ceded under certain contracts since the client may not be required to report the actual results to us until after we have issued our audited consolidated financial statements. Typically, we only use premium estimates for unreported stub periods, which account for a small percentage of our total premiums written.
Estimating loss reserves for our book of longer-tail casualty reinsurance business, which we write on proportional and non-proportional basis, involves further uncertainties. In addition to the uncertainties inherent in the reserving process referred to above, casualty business can be subject to longer reporting lags than property business, and claims often take several years to settle. During this period, additional factors and trends will be revealed and, as they become apparent, we may adjust our reserves. There is also the potential for the emergence of new types of losses within our casualty book. Therefore, any factors that extend the time until our cedents settle claims add uncertainty to the reserving process. Furthermore, determining the appropriate level of casualty reserves is largely dependent upon our view of premium rates at any given time. Therefore, overestimating the extent to which premium rates have increased (or decreased) can lead to an understatement (or overstatement) of loss reserves.
In calculating the adjusted combined ratio, we exclude underwriting losses attributable to (i) prior accident-year reserve development, (ii) catastrophe losses, and (iii) certain significant, infrequent loss events.
The following table reconciles the combined ratio to the adjusted combined ratio:
(1)Reflects our minimum contractual obligations pursuant to the lease agreements as described below.
(iii) The potential impact on the Company’s reported net income and related disclosures that could result from the adoption of certain accounting and/or financial reporting standards issued by the Financial Accounting Standards Board (FASB), Public Company Accounting Oversight Board or other standard-setting bodies;
(xiii) Unanticipated changes in industry trends and ratings assigned by nationally recognized rating organizations;
The Company makes decisions concerning the sale of invested assets based on a variety of market, business, tax and other factors. All realized gains and losses generated by these sales, charges related to other-than-temporary impairments of available-for-sale securities and other investments, and changes in valuation allowances on mortgage loans on real estate are reported in realized gains and losses on investments, hedging instruments and hedged items. Also included are changes in the fair values of derivatives qualifying as fair value hedges and the related changes in the fair values of hedged items; the ineffective, or excluded, portion of cash flow hedges; changes in the fair values of non-qualifying derivatives; and periodic net coupon settlements on non-qualifying derivatives.
Liquidity and capital resources demonstrate the overall financial strength of the Company and its ability to generate cash flows from its operations and borrow funds at competitive rates to meet operating and growth needs. The Company’s capital structure consists of long-term debt and shareholders’ equity.
or (ii) the sum of the present value of the remaining scheduled payments of principal and interest on the notes, discounted to the redemption date on a semi-annual basis at a prevailing U.S. Treasury rate plus 20 basis points, together in each case with accrued interest payments to the redemption date. The Company made interest payments on the senior notes of $71.7 million in 2004, $66.4 million in 2003 and $42.6 million in 2002.
NLIC has entered into an agreement with its custodial bank to borrow against the cash collateral that is posted in connection with its securities lending program. This is an uncommitted facility, which is contingent on the liquidity of the securities lending program. The borrowing facility was established to fund commercial mortgage loans that were originated with the intent of sale through securitization. These loans are collateral for the facility. The maximum amount available under the agreement is $350.0 million. The borrowing rate on this program is equal to one-month U.S. LIBOR. NLIC had $47.7 million outstanding under this agreement as of December 31, 2004.
In June 1998, the Company increased its investment in SportSecure GmbH ("SportSecure"), a reinsurance intermediary specializing in sports and entertainment risks. ESG holds a majority ownership in SportSecure.
losses of $11.6 million. The Company has approved a plan to divest a majority interest in its Health Care Division in 2000 through raising external capital to fund the venture. The Company expects to maintain a significant non-controlling equity investment in the venture as the Company envisages considerable long term benefit from the unit but significant additional capital is required to fund the major opportunities available in a fast consolidating sector.
- A further North American medical account written through the London market for the 1998 and 1999 years had adverse development reported to the Company during January 2000. Although gross premium written by the Company for both years was limited to $0.1 million, the Company has recognized an ultimate loss of $3.2 million equivalent to a loss and acquisition ratio of 3,716%.
- New Business--approximately $207 million, or 60.0%, of total premiums managed was generated from new business. Two new accounts contributed $76.5 million of managed premiums and these accounts are non-renewable in 2000.
- Renewal Business--approximately $38.0 million, or 17.0%, of total premiums managed was generated from renewal business. Underwriting results for the 12 months ended December 31, 1998 and 1997, by line of business and in total, were as follows:
On February 25, 2000, the Board of Directors declared a quarterly cash dividend of $0.08 per share, payable on March 30, 2000 to common shareholders of record on March 15, 2000.
On December 3, 1997, 2,673,799 common shares, Class A Warrants to purchase up to 1,381,200 common shares and Class B Warrants to purchase up to 1,381,200 common shares, subject to certain performance criteria, were sold (the "Direct Sales") for proceeds of $50 million.
The functional and reporting currency of the Company is U.S. dollars. Foreign currency receivables or payables that are denominated in a currency other than U.S. dollars are translated into U.S. dollars at the rates of exchange in effect at the balance sheet date. Revenues and expenses are translated into U.S. dollars using weighted average exchange rates for the period. The resulting exchange gains or losses are included in the results of operations. Exchange gains and losses related to the translation of investments available for sale are included in the net unrealized appreciation (depreciation) of investments, net of deferred income taxes, as a separate component of "accumulated other comprehensive income." Assets and liabilities related to foreign operations are translated into U.S. dollars at the exchange rate in effect at the balance sheet date; revenues and expenses are translated into U.S. dollars using weighted average exchange rates for the period. Gains and losses resulting from translating foreign currency financial statements, net of deferred income taxes, are excluded from income and included as a separate component of "accumulated other comprehensive income."
Revenues for the fiscal year ended December 31, 2016, were $209,519 compared to revenues of $438,028 for the comparable period ending December 31, 2015 as follows:
Recent Accounting Standards Update - During the years ended December 31, 2017, 2016, and 2015, various new ASUs were issued by the Financial Accounting Standards Board (FASB). Management has determined based on their review that the following new ASUs issued prior to or during the fiscal year ended December 31, 2015 and 2014 will be applicable to the Company. As new ASUs are released, Management will assess if they are applicable and, if they are applicable, the effect will be included in the notes to the consolidated financial statements.
During 2016, the FASB issued ASU 2016-08, ASU 2016-10, and ASU 2016-12, “Revenue from Contracts with Customers,” which provides additional clarification to the original “Revenue from Contracts with Customers” ASU 2014-09. The following is a summary of each ASU.
We underwrite global specialty property insurance and reinsurance and have large aggregate exposures to natural and man-made disasters. The occurrence of claims from catastrophic events results in substantial volatility, and can have material adverse effects on, the Company’s financial condition and results and ability to write new business. This volatility affects results for the period in which the loss occurs because U.S. accounting principles do not permit reinsurers to reserve for such catastrophic events until they occur. Catastrophic events of significant magnitude historically have been relatively infrequent, although management believes the property catastrophe reinsurance market has experienced a higher level of worldwide catastrophic losses in terms of both frequency and severity in the period from 1992 to the present. We also expect that increases in the values and concentrations of insured property will increase the severity of such occurrences in the future. The Company seeks to reflect these trends when pricing contracts.
increase over the balance of 2009. In the U.S. catastrophe market, loss-affected accounts saw increases of 25 to 35% with some as high as 80%.
1. Case reserves - Case reserves generally are analyzed and established by each segment’s claims department on all lines, making use of third party input where appropriate (including, for the reinsurance business, reports of losses from the ceding companies). For insurance business where Talbot is not the Lead underwriter on the business, the case reserves are established by the lead underwriter and validated by central Lloyd’s market claims bureau, with a sample reviewed by Talbot.
a. Large or catastrophe events - IBNR reserves are established for all lines based on the each segment’s estimates for known loss events for which not all claims have been reported to the Company. In establishing such IBNR reserves, the Company accumulates loss information from modeling agencies, where possible, publicly available sources, and information contained in client reports and estimates. The loss information is applied to the Company’s book of in-force contracts to establish an estimate of the Company’s ultimate exposure to the loss event. For some large loss events, the Company estimates an ultimate loss expectation for the individual event. Paid losses, case reserves and any additional case reserves are deducted from the ultimate loss to ascertain the IBNR estimate for individual large claims or catastrophe events. The size of event for which the Company establishes a separate ultimate loss estimate may vary based on an assessment of the materiality of the event, as well as on other factors.
premiums. In the year ended December 31, 2008, premiums written on a facility basis accounted for $190.9 million or 26.9% of total gross premiums written at Talbot.
Other Underwriting Expenses. Other underwriting expenses were $401.0 million, $350.9 million and $293.3 million in 2020, 2019 and 2018, respectively. The increases were mainly due to the impact of increases in premium earned, costs incurred to support the expansion of the insurance business and changes in affiliated reinsurance agreements.
Gross written premiums increased by 0.7% to $4,600.4 million in 2019 from $4,569.5 million in 2018, primarily due to an increase in treaty casualty writings and mortgage business, partially offset by a decline in treaty property business, including lower reinstatement premiums. Net written premiums increased by 11.5% to $3,923.8 million in 2019 compared to $3,519.7 million in 2018. The difference between the change in gross written premiums compared to the change in net written premiums is primarily due to the impact of changes in affiliated reinsurance contracts. Premiums earned increased 12.1% to $3,796.2 million in 2019 compared to $3,386.4 million in 2018. The change in premiums earned relative to net written premiums is the result of timing; premiums are earned ratably over the coverage period whereas written premiums are recorded at the initiation of the coverage period.
Management employs a prospective building block approach in establishing the discount rate and the expected long-term rate of return on plan assets. This process is integrated with the determination of other economic assumptions such as salary scale. The discount rate is set by reference to the yield on high quality corporate bonds to reflect pension settlement rates. For December 31, 2005 and 2004, the reference bond portfolio was the Moody’s AA long term corporate bond index. For pension benefits, a downward adjustment of 50-75 basis points in the discount rate was included for plan administration and other expenses. Since the OPEB liability includes both claims and administration expenses, a similar downward adjustment was not appropriate for the OPEB discount rate. The historical real rate of return for the reference bonds is subtracted from the yield on these bonds to generate an assumed inflation rate. The expected real rates of return on various asset sub-classes are developed based on historic risk premiums for those sub-classes. The expected real rates of return, reduced for investment expenses, are applied to the target allocation of each asset sub-class to produce an expected real rate of return for the target portfolio. This expected real rate of return varies by plan and changes when the plan’s target investment portfolio changes. The expected long-term rate of return on plan assets is the assumed inflation rate plus the expected real rate of return. This process effectively sets the expected return for the plan’s portfolio at the yield for the reference bond portfolio, adjusted for expected risk premiums of the target asset portfolio. Given the prospective nature of this calculation, short-term fluctuations in the market do not impact the expected risk premiums. However, as the yield for the reference bonds fluctuates, the assumed inflation rate and the expected long-term rate are adjusted in tandem.
The increase in net income primarily was driven by higher assets fees, additional interest spread income and a decline in net realized losses on investments, hedging instruments and hedged items, partially offset by higher other operating expenses and amortization of DAC.
The slight increase in pre-tax operating earnings primarily was driven by higher asset fees, lower other operating expenses, additional interest spread income and increased premiums on income products, offset by increases in amortization of DAC and other benefits and claims.
Higher amortization of DAC primarily was due to increased variable annuity revenues. Fixed annuity true-ups and unlocking also contributed to the increase.
Higher amortization of DAC resulted from increased gross margins on the underlying business.
The increase in interest spread income primarily was due to higher income from mortgage loan prepayment penalties and bond call premiums.
Basic earnings per share are computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding. The computation of diluted earnings per share is similar to the computation of basic earnings per share, except that the weighted-average number of common
“Other” primarily represents reclassifications to the reserve for assets acquired in connection with claim settlements and purchase accounting adjustments related to company acquisitions. Claims activity associated with reinsurance is not material and, therefore, not presented separately. “Payments related to current year” include $69.1 million, $61.0 million and $51.3 million in 2001, 2000 and 1999, respectively, that relate to the Company’s nontitle operations.
Effective January 1, 1995, the Company adopted The First American Corporation 401(k) Savings Plan (the “Savings Plan”), which is available to substantially all employees. The Savings Plan allows for employee-elective contributions up to the maximum deductible amount as determined by the Internal Revenue Code. The Company makes contributions to the Savings Plan based on profitability, as well as contributions of the participants. The Company’s expense related to the Savings Plan amounted to $16.0 million, $9.2 million and $13.7 million for the years ended December 31, 2001, 2000 and 1999, respectively.
Stock options outstanding and exercisable at December 31, 2001, are summarized as follows:
The change in unrealized gains on debt and equity securities includes reclassification adjustments of $(2.6) million and $3.7 million of net realized (losses) gains for the years ended December 31, 2000 and 1999, respectively. There were no reclassification adjustments in 2001.
Total revenues in this segment decreased $14.4 million to $386.5 million for 2002 from $400.9 million in 2001. The decrease primarily resulted from a decrease in investment and premium income.
Securitization transactions resulted in net gains, before taxes, of approximately $5.8 and $17.0 million for the years ended December 31, 2002 and 2001, respectively. There were no securitization transactions in 2003.
Under the date of February 6, 2004, we reported on the consolidated balance sheets of GE Life and Annuity Assurance Company and subsidiary (the Company) as of December 31, 2003 and 2002, and the related consolidated statements of income, shareholders’ interest and cash flows for each of the years in the three-year period ended December 31, 2003, which are included herein. In connection with our audits of the aforementioned consolidated financial statements, we also audited the related consolidated financial statement schedules included herein. These financial statement schedules are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statement schedules based on our audits.
(1) Computed as the change in FCBVPS after taking into account dividends declared on Common Shares and RSUs of $0.90 per share during 2014.
We reinsure exposures throughout the world against various natural catastrophe perils. The Manager manages our net exposure to these perils using a combination of industry third-party models, CATM®, underwriting judgment and purchases of outwards reinsurance and/or derivative instruments.
As of December 31, 2014, our total shareholders’ equity was $180.5 million. Assuming that our average total shareholders’ equity remains at this level in future periods, we would expect to pay the Manager a Management Fee of approximately $2.7 million per year pursuant to this agreement.
Premiums earned $ 87,793 $ 42,448 $485 $ 81,528 $ 6,750 $42,448 Losses incurred 58,022 33,597 659 56,088 2,593 33,597 LAE incurred (6,302) 8,941 223 (6,316) 237 8,941 Commissions incurred 10,111 5,051 34 9,300 845 5,051
Adjusted pre-tax operating income from Life Insurance operations was $59.1 million in 2000 compared to $51.3 million in 1999 and $42.9 million in 1998. The increase in adjusted pre-tax operating income in 2000 compared to 1999 was primarily due to increased investment income combined with decreased technology expenses and favorable mortality costs. The market value adjustments had a favorable impact of approximately $1.2 million in the Life Insurance operations in 2000. The increase in 1999 adjusted pre-tax operating income as compared to 1998 was primarily due to increased investment income and decreased deferred policy acquisition cost amortization which were partially offset by a decreased contribution from the Closed Block and increased costs related to the Year 2000 Compliance Project and enhancement of the Company's administration and distribution systems.
Company's reorganization combined with lower tax credits from affordable housing and historic rehabilitation investments.
The Company takes into account asset/liability management considerations in the product development and design process. Contract terms for the Company's interest-sensitive products include surrender and withdrawal provisions which mitigate the risk of losses due to early withdrawals. These provisions generally do one or more of the following: limit the amount of penalty-free withdrawals, limit the circumstances under which withdrawals are permitted, or assess a surrender charge or market value adjustment relating to the underlying assets. The following table summarizes liabilities for interest-sensitive life products and annuities by their contractual withdrawal provisions at December 31, 2000 (including liabilities in both the Closed Block and the general account):
The following table summarizes the composition of the fixed maturity securities by category as of December 31, 2000 and 1999:
$395.2 million or 25.8%, of MBS as of December 31, 2000. Management believes that the quality of assets in the MBS portfolio is generally high, with 89% of such assets representing agency backed or "AAA" rated securities.
GENERAL AND ADMINISTRATIVE EXPENSES totaled $166.5 million in 1995, compared with $132.7 million in 1994 and $135.8 million in 1993. General and administrative expenses in 1995 include the expenses of recently acquired Imperial. In addition, 1995 includes expenses related to a national advertising campaign to increase the Company's brand name awareness. General and administrative
At September 30, 1995, mortgage loans having an aggregate carrying value of $47.9 million had been restructured. Of this amount, $12.0 million was restructured during 1995 and $35.2 million was restructured during 1992.
Concentration of Credit Risk. The Company's financial instruments that are exposed to credit risk consist primarily of investments and accounts receivable. The Company maintains cash and cash equivalents, and short- and long-term investments with various financial institutions. These financial institutions are located in many different geographies, and company policy is designed to limit exposure with any one institution.
Scheduled maturities of the Company's notes payable and future minimum payments under capital leases, together with the present value of the net minimum lease payments at December 31, 1996, are as follows:
Employee Stock Purchase Plan. The Company has an employee stock purchase plan (the "Purchase Plan") whereby employees may purchase newly-issued shares of stock through payroll deductions at 85% of the fair market value of such shares on specified dates as defined in the Purchase Plan. As of December 31, 1996, the Company had 423,321 shares reserved for purchase under the Purchase Plan. During 1996, a total of 67,997 shares were purchased at prices of $20.83 and $26.45 per share. During January 1997, 38,094 shares were issued to employees at $20.93 per share in connection with the Purchase Plan.
Supplemental statements of cash flows information for the years ended December 31, is presented below: