For the years ended December 31, 1996 1995 1994 - ----------------------------------------------------------- Revenues: Insurance premium $448.6 $389.1 $336.6 Net engineering services revenues 55.8 252.1 232.1 Net investment income 32.3 28.2 26.2 Realized investment gains 12.1 2.8 8.7 - ---------------------------------------------------------- Total revenues $548.8 $672.2 $603.6
Domestically, exclusive of IRI, premiums increased approximately $12.3 million, or 3.9 percent. This increase was a combination of 19.2 percent growth in written premiums from our recurring client companies, and the addition of new client companies, offset by a loss of business as a result of industry consolidation. The insurance industry, in general, continues to undergo significant restructuring and consolidation. Considerable merger and acquisition activity has occurred recently and more is possible in the future. Depending on the specific companies involved in these activities and other market factors, the level of reinsured business the Company assumes in the future could be
Net engineering services pro forma revenues increased 11.9 percent in comparison to 1995. The growth in revenues was primarily due to increases generated by HSB RT as their revenues were $4.8 million (35 percent) higher in 1996 compared to 1995, almost entirely attributable to increases in volume. Pro forma net engineering services revenue
As part of HSB's strategic planning process, the Company periodically assesses its capital structure to ensure that appropriate capital is available for redeployment to support its growth. In conjunction with this process, the Company
Regulator concerns about the consistency and comparability of Statutory Accounting Principles (SAP) has prompted the NAIC to undertake a codification project that will replace prescribed or permitted SAP as the regulatory basis of accounting for insurance companies. Conversion to new statutory accounting standards is expected to be effective sometime after 1998.
Consolidated Statements of Operations for the years ended December 31, 1996, 1995 and 1994. 33
the Company's 50 percent ownership in EIG had been accounted for under the equity method. Accordingly, the results of operations for 1994 have been reflected under the caption "Equity in operations of insurance association" in the Consolidated Statements of Operations, while the 1996 and 1995 results of operations for EIG, Co. are fully consolidated.
1996 1995 1994 - --------------------------------------------------------------------------- Unrealized Investment Gains, Net of Tax Fixed maturities: Gains $ 6.1 $ 9.3 $ 2.4 Losses (1.6) (1.6) (8.7) - ---------------------------------------------------------------------------- Net gains (losses) 4.5 7.7 (6.3) Equity securities: Gains 82.0 64.2 35.8 Losses (2.2) (3.8) (9.6) - ---------------------------------------------------------------------------- Net gains 79.8 60.4 26.2 Foreign exchange (2.9) (2.7) (3.4) - ---------------------------------------------------------------------------- Total unrealized investment gains 81.4 65.4 16.5 Income taxes (28.6) (21.5) (2.6) - ---------------------------------------------------------------------------- Unrealized investment gains, net of tax $52.8 $43.9 $13.9 ============================================================================
Estimated Gross Gross Fair Unrealized Unrealized Cost Value Gains Losses - ------------------------------------------------------------------------------- Common stocks $ 98.2 $153.5 $56.7 $ 1.4 Non-redeemable preferred stocks 56.8 61.9 7.5 2.4 - ------------------------------------------------------------------------------- Total equity securities $155.0 $215.4 $64.2 $ 3.8 ===============================================================================
The assumptions used to calculate the obligations at December 31, were as follows:
Net income As Reported $53.4 $62.6 Pro Forma 51.4 61.7 Primary earnings per common share As Reported $2.65 $3.07 Pro Forma 2.55 3.02 - ---------------------------------------------------------------------------