felanders/preprocessed huggingface dataset:
oIncome taxes for the years ended December 31, 2020 and 2019 include increases of $4.5 million and $7.9 million, respectively, in the valuation allowance of the Company’s wholly-owned subsidiary, AMIC Holdings, Inc. (“AMIC”), due to the reduction of estimated tax benefits from the expected utilization of AMIC’s net operating loss carryforwards that either expired in 2020 or will expire in 2021. Earnings expectations decreased relative to the remaining period that AMIC’s net operating loss carryforwards are available to offset income and therefore necessitated an increase in the valuation allowance.
oUnderwriting experience, as indicated by its U.S. generally accepted accounting principles (“GAAP”) Combined Ratios, for the Specialty Health segment are as follows for the years indicated (in thousands):
Certain IHC subsidiaries earn fees for various lead and referral services. Each service has one performance obligation which is satisfied at a point in time when a lead is transferred to the customer or a referral results in a completed application. The Company has identified the unaffiliated insurance carriers as its customer. All prices are specified in the applicable contract.
The Company classified all of its fixed maturities as available-for-sale. These investments are carried at fair value with unrealized gains and losses reported through other comprehensive income (loss). Fixed maturities available-for-sale totaled $406.6 million and $385.0 million at December 31, 2020 and 2019, respectively. Premiums and discounts on debt securities purchased at other than par value are amortized and accreted, respectively, to interest income in the Consolidated Statements of Income, using the constant yield method over the period to maturity. Equity securities are carried at fair value. Realized gains and losses on fixed maturities available-for-sale and equity securities are computed using the specific identification method and are reported in the Consolidated Statements of Income on the trade date.
Agencies for multiple unaffiliated insurance carriers. The increase in sales of these particular products began in 2020 as a result of new contracts with the unaffiliated carriers and increased distribution channels.
earnings, (iii) projected new and renewal business as well as profit margins on such business, and (iv) a discount rate that incorporated an appropriate risk level for the reporting unit.
This Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) addresses the financial condition of Prudential Annuities Life Assurance Corporation (“PALAC”), formerly known as American Skandia Life Assurance Corporation as of December 31, 2007, compared with December 31, 2006, and its results of operations for the years ended December 31, 2007 and 2006.
Net income increased by $98.9 million, from $195.7 million for the twelve months ended December 31, 2006 to $294.6 million for the twelve months ended December 31, 2007. Policy charges and fee income increased by $146.1 million and asset management fees increased by $55.9 million, driven by growth in the separate account assets due to positive net flows and market appreciation since December 31, 2006. Additionally, realized investment losses, net, decreased by $7.1 million from $48.0 million for the twelve months ended December 31, 2006 to $40.9 million for the twelve months ended December 31, 2007. Net income also included a $40.6 million benefit in the current year compared to $8.9 million expense in the prior year from a net reduction in amortization of deferred policy acquisition and other costs and a decrease in reserves for the guaranteed minimum death benefit and guaranteed minimum income benefit features of our variable annuity products, due to decreased costs of actual and expected claims and an increased estimate of total gross profits used as a basis for amortizing deferred policy acquisition based on an annual review. These favorable variances were partially offset by an increase of $64.5 million in amortization of DAC and other costs, excluding the current year benefit mentioned above, due to higher actual gross profits. In addition, commissions, net of capitalization, increased by $30.6 million driven by higher asset based commissions due to growth in separate account assets, net investment income decreased by $13.7 million, general and administrative expenses increased by $10.3, million primarily driven by an increase to a customer remediation reserve due to the market value adjustment error, as previously discussed, interest credited to policyholder’s account balances increased $15.0 million driven by amortization of deferred sales inducements due to higher gross profits, and interest expense increased $12.5 million. Further details regarding the components of revenues and expenses are described below.
Net investment income decreased $13.7 million from $88.3 million for the twelve months ended December 31, 2006 to $74.6 million for the twelve months ended December 31, 2007 as a result of a decline in general account assets as these assets moved from general account fixed rate investment options into separate account variable investment options due to the GRO rebalancing element.
Information required with respect to this Item 8 regarding Financial Statements and Supplementary Data is set forth commencing on page hereof. See Index to Financial Statements elsewhere in this Annual Report.
Included in the plans' assets are Common Shares of the Company valued at $6.1 as of December 31, 2002 and 2001.
Note 3-Shareholders' Equity - All common and preferred share data herein has been retroactively adjusted as applicable for stock dividends or splits declared through December 31, 2002.
(d) Common Stock-There were 500,000,000 shares of common stock authorized at December 31, 2002. At the same date, there were 100,000,000 shares of Class "B" common stock authorized but none were issued or outstanding. Class "B" common shares have the same rights as common shares except for being entitled to 1/10th of a vote per share. In March 2000, the Company canceled 36,420,135 common shares previously reported as treasury stock, restoring them to unissued status; this had no effect on total shareholders' equity or the financial position of the Company.
On February 23, 1998, the Company entered into an Agreement Containing Consent Order (the “Consent Order”) with the Federal Trade Commission (the “FTC”) in connection with the acquisition of Commonwealth and Transnation. The Consent Order required, and the Company completed, the divestiture of certain title plants in 12 localities named in the Consent Order. Seven of such localities were in Florida, three were in Michigan, and one each was in Washington, D.C. and St. Louis, Missouri. Pursuant to the terms of the Consent Order, the Company may not acquire, without prior notice to the FTC, any interest in a title plant in any of the named localities for a period of 10 years following the date of the Consent Order.
In the fourth quarter of 2001, the Company reassessed the carrying value of intangibles and capitalized software which resulted in net of tax charges to earnings of $32,893. See Note 15 to the Consolidated Financial Statements.
The Company’s primary business is the provision of real estate transaction services, including the insurance of titles to real property, which is greatly influenced by the real estate economy. During the three-year period from 2000 through 2002, the Company’s title operations benefited from three distinct factors. Operations were expanded through the acquisition of title insurance agents, expenses were tightly monitored and controlled and the economic environment for the Company’s products improved.
Historically, residential real estate activity has been generally slower in the winter, when fewer families buy or sell homes, with increased volumes in the spring and summer. Residential refinancing activity is generally more uniform throughout the seasons, but is subject to interest rate variability. The Company typically reports its lowest revenues in the first quarter, with revenues increasing into the second quarter and through the third quarter. The fourth quarter customarily may be as strong as the third quarter, depending on the level of activity in the commercial real estate market.
Agents’ Commissions. Commissions paid to title insurance agents are the largest single expense incurred by the Company. The commission rate varies by geographic area in which the commission was earned. Commissions as a percentage of agency revenue were 79.5% in 2002, 78.9% in 2001 and 78.3% in 2000. The trend of increasing commission rates is attributable to increased competition for agents and an increase in commission rates promulgated by states.
In 1999, the Board of Directors approved plans to repurchase 2.0 million of the Company’s issued and outstanding common shares. Purchases of 2.0 million shares at a cost of $48.3 million were completed during the first quarter of 2000.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
In mid-1997, the project team contacted all key vendors to obtain either their certification for the products and services provided or their plan to make those products and services compliant. Approximately 95% of these vendors have responded and the project team has reviewed the responses, validated and conducted tests with the vendors where appropriate. In addition, the project team continues to work with critical business partners, such as third-party administrators, investment property managers, investment mortgage correspondents, and others, with the goal that these partners will continue to be able to support the Company's objective of assuring Year 2000 compliance.
Basic net loss per common share ("EPS") is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted earnings per shares is computed by dividing net income by the weighted average shares outstanding, assuming all dilutive potential common shares were issued.
As of April 30, 2010, the Company does not expect any of the recently issued accounting pronouncements to have a material impact on its financial condition or results of operations.
As of April 30, 2010, the Company’s Chief Executive Officer, Alan P. Donenfeld, as a beneficial owner for securities held by Paragon Capital LP, holds warrants that are exercisable into 135,000,000 common shares of the Company. The $145,000 paid by Paragon Capital LP for the right to exercise these warrants is reflected in the additional paid in capital on the Company’s balance sheet.
As of April 30, 2010, the amount of gross unrecognized tax benefits before valuation allowances and the amount that would favorably affect the effective income tax rate in future periods after valuation allowances were $0. The Company has not accrued any additional interest or penalties. No tax benefit has been reported in connection with the net operating loss carry forwards in the consolidated financial statements as the Company believes it is more likely than not that the net operating loss carry forwards will expire unused. Accordingly, the potential tax benefits of the net operating loss carry forwards are offset by a valuation allowance of the same amount.
Reconciliation between the statutory rates and the effective tax rates are as follows:
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Stirling Cooke Brown Holdings Limited and subsidiaries as of December 31, 2000 and 2001 and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2001 in conformity with accounting principles generally accepted in the United States.
Insurance balances receivable of $1,039,012 (2000 -- $872,666) and payable of $1,051,703 (2000 -- $910,437) primarily consist of clients' claims and premiums balances recorded by the Company in its capacity as an intermediary. As a result of various disputes between insurers and reinsurers on various reinsurance contracts, a number of the reinsurers have suspended paying claims due under the contracts. The Company's brokerage and discontinued underwriting management segment subsidiaries have experienced a significant growth in claims due from one party to another. These balances are reflected as assets and liabilities of the Company in its role as an intermediary.
In October 1998, the Company purchased a further 47,000 of its ordinary shares on the open market for a total cost of $567. These shares were held as treasury stock at cost at December 31, 2000 and 2001.
The Company's financial instruments exposed to possible concentrations of credit risk consist primarily of its cash and cash equivalents, outstanding losses recoverable from reinsurers and insurance and reinsurance balances receivable.
(a) The Company has three continuing business segments; Insurance, Program Business, and Brokerage. The insurance segment represents a subsidiary that underwrites and retains, subject to its own reinsurance, certain insurance and reinsurance risks, and its revenues include premiums earned on insurance polices, investment income and policy issuance fees. The program business segment comprises subsidiaries that market insurance products and manage programs developed by the Company. The brokerage segment comprises subsidiaries that receive a fee or commission for brokering insurance and reinsurance contracts. Other includes the Company's holding companies and group services companies. In early 2001, following a review of its operations, the Company decided to discontinue its reinsurance and underwriting management segments, as discussed in Note 3. Intercompany transactions are recorded under normal terms of trade. Adjustments and eliminations to revenue are in respect of intersegmental revenues that are eliminated at the consolidated level. Adjustments and eliminations of assets are primarily in respect of intersegmental insurance balances receivable that are eliminated at the consolidated level.
2000 2001 ---- ---- Total capital and surplus at December 31,....... $14,116 $13,840 Net income (loss) for year ended December 31,... $(4,167) $(4,558)
We performed our qualitative goodwill impairment assessment at December 31, 2011 under the new ASU guidance and concluded that it was not more-likely-than-not that goodwill impairment existed at that date. As a result, we did not need to proceed to step one for any of our reporting units. Our fiscal 2011 annual goodwill impairment analysis included an assessment of certain qualitative factors including, but not limited to, the results of the prior year fair value calculation, the movement of the company’s share price and market capitalization, overall financial performance, and macro-economic and industry conditions. We considered the qualitative factors and weighted the evidence obtained, and we determined that it is not more likely than not that the fair value of any reporting unit is less than its carrying amount. Although we believe the factors considered in the impairment
We recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more-likely-than-not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority.
The components of net investment income are set forth in the table below:
The increase in gross investment income from cash and short-term investments in 2000 is primarily due to an increase in average invested cash and short-term investments balances over the prior year.
Individual annuity surrenders increased $156.6 million, or 69%, in 2000 and $98.9 million, or 44%, during 1999 with the majority of the withdrawals coming from separate accounts. We believe this increased rate of individual annuity surrenders is primarily due to two factors:
decreased to 8% of the total portfolio at December 31, 2000, from 12% as of December 31, 1999 while mortgage-backed securities increased from 7% to 10% during this same time period. Corporate debt securities remained level at 76% of the portfolio in 2000 and 1999.
Our liquid assets include U.S. Treasury bond holdings, short-term money market investments, stocks, and marketable long-term fixed income securities. Cash and short-term investments totaled $115.4 million at December 31, 2000. The carrying value of highly liquid securities, comprised of NAIC Class 1 and 2 publicly traded bonds, was approximately $616.2 million at December 31, 2000.
The tables below set forth the carrying value, gross unrealized gains and losses, net unrealized gains and losses and estimated fair value of our bond portfolio (excluding short-term securities) at December 31, 2000 and 1999.
for in the bond contract. At December 31, 2000, we had $3.3 million in under-performing bonds. At December 31, 1999, we had no under-performing bonds.
During 2000 and 1999, all renewed bullet loans were performing assets prior to renewal and all loan renewals reflected market conditions. Past experience with regard to bullet maturities, however, is not necessarily indicative of future results.
When we determine that it is probable that the net realizable value of an invested asset is less than our carrying value, we establish and record appropriate write-downs or investment reserves in accordance with statutory practice.
Federal tax refunds were $14.6 million in 2000 and federal tax payments were $6.8 million in 1999 and $16.9 million in 1998.
During 2000 and 1998, MassMutual contributed additional paid-in capital of $85.0 million and $25.0 million, respectively, to the Company.
Intangible assets represent trade secrets acquired and non-compete agreements entered into in connection with business combinations. These assets are being amortized into income over periods corresponding with their terms or useful lives that range from three to ten years using the straight-line method. Management regularly reviews the carrying value of intangible assets by determining whether the amortization of the intangible assets can be recovered through undiscounted future operating cash flows of the acquired operation.
Net realized investment gains increased 420%, to $1.4 million for the year ended December 31, 2001 from $0.3 million for the year ended December 31, 2000. The Company engaged new professional investment managers during the third quarter of 2001 as part of its overall investment strategy. While the Company's investment strategy remains focused on high quality, fixed income securities, it does plan some changes in its present asset allocation to take advantage of changing market conditions. The increase in net realized investment gains coincides with the liquidation of investments associated with repositioning the Company's investment portfolio.
As of December 31, 2001, the Company had $53.0 million outstanding under the credit facility. The credit facility is comprised of (i) a $37.5 million revolving credit facility (with a $15 million letter of credit sub-facility), which matures on August 31, 2004, and (ii) a $17.5 million term loan facility, repayable in twelve equal quarterly
installments of approximately $1.5 million each that commenced December 31, 2001. Amounts outstanding under the credit facility bear interest at a variable rate, primarily based upon LIBOR plus an applicable margin of 2.25 percentage points, which may be reduced to a minimum of 1.75 percentage points as the Company reduces its outstanding indebtedness. The Company is not required to maintain compensating balances in connection with these credit facilities but is charged a fee on the unused portion, which ranges from 20 to 30 basis points.
Under the terms of the credit facility, the Company is required to meet certain financial covenants. Significant covenants as of December 31, 2001, are as follows: a) total debt to cash flow available for debt service cannot be greater than 4.00:1 for the quarter ending December 31, 2001 and 3:50:1 thereafter; b) combined net premiums written to combined statutory capital and surplus cannot exceed 2.00:1; c) the fixed charge coverage ratio cannot be less than 2.00:1 at the end of each quarter through December 31, 2002, thereafter the fixed charge coverage ratio cannot be less than 2:25:1 and d) funded debt to total capital plus funded debt cannot exceed 0.27:1. The credit facility also contains minimum equity and risk-based capital requirements and requires the Company's insurance subsidiaries to maintain at least an A- (Excellent) rating from A.M. Best.
The personal excess liability program has remained stable over the three-year period ended December 31, 1996 producing approximately $2 million in gross written premiums each year. Underwriting profits can vary significantly with the number of claims which occur infrequently. The results of this line are considered largely immaterial compared to the overall results of the Company.
Realized capital gains on the sales of investments have declined over the past three years, generally reflective of a change in the mix of taxable versus non-taxable securities held and an overall decrease in the amount of investments needed to be sold to cover losses and loss adjustment expenses.
The amortized cost and fair value of the Company's fixed maturity investments at December 31, 1996 are summarized, by contractual maturity, as follows:
Current tax expense (credit) $ 2,535 $ 719 $ (73,565) Deferred tax expense (credit) 31,835 30,856 (214,522) -------- -------- ---------- $ 34,370 $ 31,575 $ (288,087) -------- -------- ---------- -------- -------- ----------
On December 16, 1994, the Company received $216 million of equity capital from AIG and in exchange, issued (i) 200,000 shares of Series A 9% Convertible Preferred Stock, par value $1.00 per
The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
The Company’s Agent Stock Incentive Plan (“ASIP”) was approved in August 2018 by the Texas State Securities Board. The plan awards shares of Texas Republic Capital Corporation common stock to agents based on certain production levels achieved in sales of life and annuity products. Calculation of awards at December 31, 2018 are based on production for the period of August through December 2018. The ASIP will issue 1,270 shares.
Net cash used in investing activities totaled $136.9 million in 2016 compared to cash provided of $0.6 million in 2015 and cash used of $5.1 million in 2014. Increases in purchases of available-for-sale securities and fixed assets, coupled with lower cash generated from the return of capital from limited partnerships, contributed to cash used in 2016, compared to cash provided in 2015. Somewhat offsetting the cash used in 2016 was an increase in cash generated from the sale and maturity of available-for-sale securities, compared to 2015. Also impacting our future investing activities are limited partnership commitments, which totaled $16.9 million at December 31, 2016, and will be funded as required by the partnerships’ agreements. Of this amount, the total remaining commitment to fund limited partnerships that invest in private equity securities was $6.8 million, mezzanine debt securities was $8.2 million, and real estate activities was $1.9 million. While cash generated from the sale of available-for-sale securities was lower in 2015, compared to 2014, decreases in purchases of available-for-sale securities and fixed assets contributed to net cash being generated for 2015.
We have significant receivables from the Exchange that result in a concentration of credit risk. These receivables include management fees due for services performed by us for the Exchange under the subscriber’s agreement, and certain costs we pay
The pension plan's expected long-term rate of return represents the average rate of return to be earned on plan assets over the period the benefits included in the benefit obligation are to be paid. To determine the expected long-term rate of return
401(k) savings plan. We match 100% of the participant contributions up to 3% of compensation and 50% of participant contributions over 3% and up to 5% of compensation. Matching contributions paid to the plan were $12.1 million in 2016, $11.6 million in 2015, and $10.7 million in 2014. Employees are permitted to invest the employer-matching contributions in our Class A common stock. Employees, other than executive and senior officers, may sell the shares at any time without restriction, provided they are in compliance with applicable insider trading laws; sales by executive and senior officers are subject to additional pre-clearance restrictions imposed by our insider trading policies. The plan acquires shares in the open market necessary to meet the obligations of the plan. Plan participants held 0.2 million shares of our Class A common stock at December 31, 2016 and 2015.
Primrose Country Day School leases land and buildings containing a total of 8,000 square feet located in Georgia where it maintains its educational child care operations.
Amortization and depreciation increased by $550,000 for the year ended December 31, 2000. Without taking into consideration the Health Power acquisition, amortization and depreciation increased by $446,000 for the year ended December 31, 2000, as compared to the year ended December 31, 1999. The educational segment's amortization and depreciation expense increased by $410,000 which was primarily attributable to its inclusion for the full year of 2000 compared to nine months for 1999 due to its April 1999 acquisition. The remainder of the increase, $36,000, was attributable to the seasonal product segment.
The Company's income tax expense increased by $1,908,000 primarily as a result of the 1999 period reflecting $1,347,000 benefit from the utilization of net operating losses compared to $204,000 in the current period (see Note 12 to the consolidated financial statements).
In connection with the financing of the acquisition, the Company sold 1,136,364 shares of Class A Common Stock for $5,000 in a private placement transaction with an affiliate of the Company's controlling shareholder, and borrowed funds under bank credit agreements. Under terms of the bank credit agreements, the borrowings are secured by a pledge of all assets of the Primrose businesses, and by the capital stock of Primrose held by the Company.
Pumpkin's agreement is a $3,500 line of credit, under which borrowing capacity is limited to a defined borrowing base. Interest is calculated at the commercial paper rate plus 4.25% (10.61% and 9.77% at December 31, 2000 and 1999, respectively). There were no borrowings outstanding at either balance sheet date. Borrowing capacity under the line was $1,560 at December 31, 2000. The agreement expires in 2003 or upon the repayment of the Pumpkin Tranche A and B term loans, if earlier.
Pro forma net income $1,017 Pro forma earnings per common share: Basic .16 Diluted .16
Diluted earnings per share reflect per share amounts that would have resulted if dilutive potential common stock had been converted to common stock. The following reconciles amounts reported in the financial statements:
In 1993, the Company adopted Statement of Financial Accounting Standards No. 112 (SFAS 112), "Employers' Accounting for Postemployment Benefits," with retroactive application to January 1, 1993. The adoption of SFAS 112 resulted in a non-cash, after- tax charge of $3.6 million or $.17 per share. This charge was recognized as the cumulative effect of a change in accounting in the Consolidated Statements of Operations.
In 1996, HSB's interest in Radian International LLC will be accounted for on the consolidated financial statements under the equity method of accounting. Had the transaction occurred at the beginning of 1995 total revenues and total expenses would have been $470.7 and $399.7 million, respectively, and consolidated assets and liabilities at December 31, 1995 would have been $954.1 and $613.0, respectively.
In the remainder of this Financial Summary section and the following Segment Information section, all analyses relate to the comparable proforma information, except where indicated.
Incurred Losses and LAE. Incurred loss and LAE increased by 7.3% to $2,202.8 million in 2005 from $2,053.8 million in 2004. The increase in incurred losses and LAE was principally attributable to the increase in estimated losses due to property catastrophes, partially offset by favorable non-catastrophe prior period reserve development and a lower level of earned premiums. Incurred losses and LAE in 2005 reflected ceded losses and LAE of $852.4 million compared to ceded losses and LAE in 2004 of $789.6 million. The increase in ceded losses was primarily the result of fluctuations in losses ceded under the specific reinsurance coverages purchased by the U.S. Insurance operation.
Corporate expenses not allocated to segments were $6.2 million for 2005 as compared to corporate income of $2.0 million for 2004, as the Company expanded its infrastructure to support operations.
Premium Revenues. Net premiums earned increased by 9.8% to $2,710.3 million in 2004 from $2,467.4 million in 2003. Contributing to this increase were a 45.7% ($148.1 million) increase in the International operation, a 9.0% ($95.0 million) increase in the U.S. Reinsurance operation and a 6.2% ($42.4 million) increase in the U.S. Insurance operation, partially offset by a 10.6% ($42.5 million) decrease in the Specialty Underwriting operation. These net premiums earned reflect period to period changes in net written premiums and business mix, together with normal variability in earnings patterns. Business mix changes occur not only as the Company shifts emphasis between products, lines of business, distribution channels and markets, but also as individual contracts renew or non-renew, almost always with changes in coverage, structure, prices and/or terms, and as new contracts are accepted with coverages, structures, prices and/or terms different from those of expiring contracts. As premium reporting, earnings, loss and commission characteristics derive from the provisions of individual contracts, the continuous turnover of individual contracts, arising from both strategic shifts and day to day underwriting, can and does introduce appreciable background variability in various underwriting line items. Changes in estimates related to the reporting patterns of companies may also affect premiums earned.
As of December 31, 2020, we had marketable securities held in the trust account of $230,007,184 (including approximately $7,184 of interest income) consisting of U.S. Treasury securities with a maturity of 185 days or less. Interest income on the balance in the trust account may be used by us to pay taxes. Through December 31, 2020, we did not withdraw any interest earned on the trust account.
All activity through December 31, 2020 related to the Company’s formation, the initial public offering, or Initial Public Offering, which is described below, identifying a target company for a Business Combination, and activities in connection with the proposed acquisition of Legacy Metromile.
Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 540,000 units, or the Placement Units, at a price of $10.00 per Placement Unit in a private placement to the Sponsor and Cantor Fitzgerald & Co., or Cantor, generating gross proceeds of $5,400,000, which is described in Note 4.
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.
Simultaneously with the closing of the Initial Public Offering, the Sponsor and Cantor purchased an aggregate of 540,000 Placement Units, at a price of $10.00 per Placement Unit, or $5,400,000 in the aggregate, of which 452,500 Placement Units were purchased by Insurance Acquisition Sponsor II, LLC and 87,500 Placement Units were purchased by Cantor. Each Placement Unit consists of one share of Class A common stock and one-third of one warrant, or the Placement Warrant. Each whole Placement Warrant is exercisable for one share of Class A common stock at a price of $11.50 per share. The proceeds from the Placement Units were added to the proceeds from the Initial Public Offering held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period, the proceeds from the sale of the Placement Units will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Placement Warrants will expire worthless. There will be no redemption rights or liquidating distributions from the Trust Account with respect to the Placement Warrants.
Expense Ratio-Expense ratio is the ratio (expressed as a percentage) of insurance operating expenses to net premiums earned. Insurance operating expenses are reduced by commission and fee income from insureds. This is a measurement that illustrates relative management efficiency in administering our operations.
The National Association of Insurance Commissioners Model Act for risk-based capital provides formulas to determine each December 31 on an annual basis the amount of statutory capital and surplus that an insurance company needs to ensure that it has an acceptable expectation of not becoming financially impaired. There are also statutory guidelines that suggest that on an annual calendar year basis an insurance company should not exceed a
The debentures are classified as debentures payable in the Company’s consolidated balance sheets and the interest paid on these debentures is classified as interest expense in the consolidated statements of operations and comprehensive income (loss). During 2012, the Company revised its accounting for certain of the issuance costs from the original 2007 debt transaction from deferred financing costs (included within other assets) to a debt discount (reduction of debentures payable). Accordingly, unamortized issuance costs of $1.0 million at December 31, 2011 have been reclassified to conform to the 2012 presentation. At December 31, 2012, the unamortized debt discount of $1.0 million is being amortized to interest expense over the term of the debentures.
8.309% Junior Subordinated Debentures-The Junior Subordinated Debentures bear interest at the rate of 8.309% per annum paid semiannually and mature on February 1, 2027. The Junior Subordinated Debentures are subordinated to all senior indebtedness of The PMI Group, Inc. As of February 1, 2007, the Parent Company has the right to redeem the Junior Subordinated Debentures prior to their stated maturity at the option of the Parent Company, in whole at any time or in part from time to time. Redemption prior to the stated maturity will require the prior consent of the credit facility lenders.
Amendment No. 1 dated May 21, 2010 to the PMI Amended and Restated Equity Incentive Plan dated May 21, 2009 (incorporated by reference to exhibit 10.1 to the registrant’s current report on Form 8-K filed on May 25, 2010 (File No. 001-13664)).
2008 Form of Change of Control Employment Agreement (incorporated by reference to exhibit 10.5 to the registrant’s current report on Form 8-K, filed on November 25, 2008 (File No. 001-13664)).
Form of Amendment to 2008 Change of Control Employment Agreement (incorporated by reference to exhibit 10.8a to the registrant’s annual report on Form 10-K for the year ended December 31, 2008, filed on March 16, 2009 (File No. 001-13664)).
Amended and Restated Trust Agreement, dated as of February 4, 1997, among The PMI Group, Inc., as Depositor, The Bank of New York, as Property Trustee, and The Bank of New York (Delaware), as Delaware Trustee (incorporated by reference to exhibit 10.30 to the registrant’s annual report on Form 10-K for the year ended December 31, 1996, filed on March 31, 1997 (File No. 001-13664)).
Amendment Agreement by and among PMI Mortgage Insurance Co., QBE Holdings (AAP) Pty Limited and QBE Insurance Group Limited, dated as of August 29, 2008 (incorporated by reference to exhibit 10.2 to the registrant’s current report on Form 8-K, filed September 2, 2008 (File No. 001-13664)).
The above summary operations information does not necessarily reflect the results of operations as they actually would have been if the acquisition had occurred at the beginning of the periods presented or of results which may occur in the future.
For purposes of the above discussion, invested assets are comprised of fixed maturities and equity securities at amortized cost and short-term investments. The earnings on such invested assets constitute the related net investment income. The Company calculates the yield on invested assets by dividing the related investment income by the monthly average of invested assets.
The Company's effective tax rate for the years ended December 31, 1998 and 1997 was 26% and 24%, respectively. The effective tax rates were lower than the statutory rate of 35% primarily because of the effect of tax exempt investment income. The increase is principally due to the tax exempt income representing a lesser percentage of operating income in 1998. There are no loss carryforwards included in the deferred tax asset.
Results: •X;! — Non-Life reinsurance 63 32 - 3 — Life reassurance 46 58 49
Accident and Sickness reinsurance produced a profit from a slightly higher premium income.
As a result of the monetary changes, the Credit and Surety branches were marked by a slight loss of premium, in comparison with the previous year, but the results were good. The imcertainty of the current economic situation demands increased caution.
Of the assets shown, Sw. frs. 67 million (previous year, 48 million) are held by trustees appointed by us in over­ seas territories.
The gross Life business in force rose by US ^ 561 million to US $ 5,673 million. Higher mortality and increased acquisition costs resulted in a lower, but still good under­ writing result. The sharp rise of management expenses and the realized capital losses could only be offset in part by the reduction in taxes. — In 1972, the dividends paid amounted to US | 400,000 (previous year, US $ 360,000).
North American Reassurance Company 1923 Life 245 Park Avenue, New York, N. Y. 10017 with Offices in Aurora (Denver), Chicago, Dallas and Hartford
3. The equity volatility assumption is adjusted to remove certain risk margins required under U.S. GAAP valuation which are used in the projection of customer account values, as we believe the impact of these margins is highly sensitive to short-term market conditions and does not reflect the long-term nature of these guarantees.
Separate account assets increased $2,116 million, from $6,258 million at December 31, 2011 to $8,374 million at December 31, 2012, primarily driven by positive net flows from variable annuity new business sales and market appreciation.
Separate account liabilities increased $2,116 million, offsetting the increase in separate account assets described above.
In May 1993, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards 115, "Accounting for Certain Investments in Debt and Equity Securities". The new standard requires that securities designated as available for sale be carried at fair value, with unrealized gains and losses, less related deferred income taxes, excluded from earnings and reported as a separate component of stockholders' equity. In addition, securities designated as trading are required to be carried at fair value, with unrealized gains and losses included in the statement of earnings. Previously, the Company carried these investments at either the lower of cost or fair value, or at amortized cost. As of January 1, 1994, the Company adopted the provisions of the new standard for investments held as of or acquired after that date. In accordance with Statement 115, prior period financial statements have not been restated to reflect the change in accounting principle. The cumulative effect as of January 1, 1994 of adopting Statement 115 increased the opening balance of stockholders' equity by $1,456,000 (net of deferred income taxes of $970,000) to reflect
Substantially all fixed maturity securities mature in 1999 or later. Actual maturities may differ from contractual maturities because the issuers of the securities may have the right to call or prepay obligations.
In November, 1994, the Company retired its $20 million variable-rate (based on LIBOR plus .625%) unsecured revolving credit agreement that was due in 1998. In connection with the retirement, the Company also recognized a gain of $656,000 on the settlement of interest rate exchange agreements that had been entered into in 1993 to fix the rate of interest payable on the revolving credit agreement. The credit agreement remains in effect and, as of December 31, 1995, there were no borrowings outstanding under this agreement.
The table below summarizes certain information about the Company's capital stock at December 31, 1995 and 1994:
Non-voting Rights, authorized by the Board of Directors on March 10, 1987 and approved by stockholders on May 12, 1987, were distributed May 12, 1987 as a dividend to holders of the Company's common stock at the rate of one Right for each common share held. Under certain conditions, each Right may be exercised to purchase one share of common stock at an exercise price of $100. The Rights become exercisable and transferable apart from the common stock after a public announcement that a person or group has acquired 20% or more of the common stock or after commencement or public announcement of a tender offer for 30% or more of the common stock. If the Company is acquired in a merger or business combination, each Right may be exercised to purchase the common stock of the surviving company having a market value of twice the exercise price of each Right. The Rights, which expire May 12, 1997, may be redeemed by the Company at 5 cents per Right at any time prior to the public announcement of the acquisition of 20% of the common stock. At December 31, 1995, 25,000,000 shares of common stock were reserved for potential exercise of the Rights.
The 2017/2019 Treaty structure limits the amount of contingent ceding commissions that we can receive by setting a higher provisional commission rate than the rates received in prior years. As a result of the higher upfront provisional ceding commissions that we received under the 2017/2019 Treaty, there is not an opportunity to earn additional contingent ceding commissions under this treaty. Under the 2017/2019 Treaty “net” treaty structure, catastrophe losses in excess of the $5,000,000 retention will fall outside of the quota share treaty and such losses will not have an impact on contingent ceding commissions. In Year Ended 2018, catastrophe losses of $1,506,000 were ceded under our personal lines quota share treaty. These catastrophe losses resulted in the Loss Ratios for the period July 1, 2017 through June 30, 2018 (attributable to the 2017/2019 Treaty) being higher than the contractual Loss Ratio at which provisional ceding commissions were being earned. As a result, we incurred a reduction to the contingent ceding commissions of $459,000 relative to what would have been earned had the catastrophe losses not occurred. Effective July 1, 2018, the provisional ceding commission rate was a fixed rate with no downward adjustment required related to Loss Ratio; accordingly, in Year Ended 2019, catastrophe losses of $927,000 that were ceded under our personal lines quota share treaty did not have an effect on contingent ceding commissions. See “Reinsurance” below for information as to our personal lines quota share treaty effective December 15, 2019, and July 1, 2019, 2018 and 2017.
Net loss and LAE was $90,182,000 in Year Ended 2019 compared to $58,295,000 in Year Ended 2018. The net loss ratio was 70.7% in 2019 compared to 56.4% in 2018, an increase of 14.3 percentage points.
Pursuant to the definition of “Fair Value Measurement,” set forth in the Accounting Standards Codification 820 “Fair Value Measurement” (“ASC 820”) an entity is permitted, as a practical expedient, to estimate the fair value of an investment within the scope of ASC 820 using the net asset value (“NAV”) per share (or its equivalent) of the investment. The following table presents a breakdown of the cost, estimated fair value, and gross losses of our other investments as of December 31, 2019 and 2018:
As of December 31, 2019, invested assets and cash in our holding company was approximately $939,000. If the aforementioned sources of cash flow currently available are insufficient to cover our holding company cash requirements, we will seek to obtain additional financing.
First Tennessee Bank National Association also provided UTG, Inc. with a $5,000,000 revolving credit note. This note is for a one-year term and may be renewed by consent of both parties. The credit note is to provide operating liquidity for UTG, Inc. and replaces a previous line of credit provided by Southwest Bank. Interest bears the same terms as the above promissory note. The collateral held on the above note also secures this credit note. UTG, Inc. has no borrowings against this note at this time.
The FASB also issued Statement No. 162, The Hierarchy of Generally Accepted Accounting Principles. This Statement identifies the sources of accounting principles and the framework for selecting the principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles (GAAP) in the United States (the GAAP hierarchy). This Statement is effective 60 days after the SEC’s approval of the Public Company Accounting Oversight Board amendments to the auditing literature. The Company does not believe the adoption will have a material impact on its consolidated financial condition or results of operations.
In 2008 and 2007, the Company established a deferred tax liability of $927,904 and $2,389,697 respectively, for the unrealized gains based on the applicable United States statutory rate of 35%.