|
|
 | | | |
- close
- close
- close
- close
These excerpts taken from the ALL 8-K filed Feb 1, 2006. New Jersey
Agreement – This agreement is being contemplated, but has not yet
been placed. This agreement is expected
to be effective 6/1/2006.
We anticipate that the total cost of these agreements will be approximately $600 million per year or $150 million per quarter. This represents an increase of approximately $400 million per year or $100 million per quarter over our current cost, once these agreements are fully implemented and effective. Based on the effective dates of these agreements, our total costs are expected to be approximately $60 million in the first quarter of 2006, $100 million in the second quarter of 2006 and $150 million in the third and fourth quarters of 2006. We will aggressively seek regulatory approvals, as necessary based on the challenging regulatory environment in each state, to include reinsurance costs in our premium rates in order to mitigate the impact of this increase. We currently expect that this level or a similar level of reinsurance coverage will be purchased or renewed for 2007. We also continue to study the efficiencies of our operations and cost structure, which may offset some portion of the increased reinsurance costs.
This current report on Form 8-K contains forward-looking statements about changes in the Registrant's reinsurance program, the related premium and reductions in costs. These statements are subject to the Private Securities Litigation Reform Act of 1995 and are based on management's estimates, assumptions and projections. The actual changes in the reinsurance program, related premium and cost reductions may differ materially from those discussed in this report due to not yet placing the remainder of our program in the reinsurance market and in the ability to reduce expenses to the desired level.
New Jersey Agreement – This agreement is being contemplated, but
has not yet been placed. This agreement is expected to be effective 6/1/2006.
We anticipate that the total cost of these agreements will be approximately $600 million per year or $150 million per quarter. This represents an increase of approximately $400 million per year or $100 million per quarter over our current cost, once these agreements are fully implemented and effective. Based on the effective dates of these agreements, our total costs are expected to be approximately $60 million in the first quarter of 2006, $100 million in the second quarter of 2006 and $150 million in the third and fourth quarters of 2006. We will aggressively seek regulatory approvals, as necessary based on the challenging regulatory environment in each state, to include reinsurance costs in our premium rates in order to mitigate the impact of this increase. We currently expect that this level or a similar level of reinsurance coverage will be purchased or renewed for 2007. We also continue to study the efficiencies of our operations and cost structure, which may offset some portion of the increased reinsurance costs.
This excerpt taken from the ALL 8-K filed Jan 10, 2006. New Jersey Agreement – This
agreement is being contemplated, but has not yet been placed. This agreement is expected to be effective
6/1/2006.
5
We anticipate that the total cost of these agreements will be approximately $600 million per year or $150 million per quarter. This represents an increase of approximately $400 million per year or $100 million per quarter over our current cost, once these agreements are fully implemented and effective. Based on the effective dates of these agreements, our costs are expected to increase to approximately $75 million in the second quarter of 2006 and to approximately $150 million in the third quarter of 2006. We will aggressively seek regulatory approvals, as necessary, to include reinsurance costs in our premium rates in order to mitigate the impact of this increase. We also continue to study the efficiencies of our operations and cost structure, which may offset some portion of the increased reinsurance costs.
In addition to the agreements expected to be implemented in 2006 as shown in the table above, we are also continuing to evaluate additional purchases of reinsurance to mitigate potential exposure to major hurricanes, specifically in the state of Florida, and earthquakes, including potential assessments from the California Earthquake Authority. The costs of any such additional purchases are not included in our estimate of total cost.
As part of our catastrophe management efforts, we are involved with a newly created coalition called Protecting-America.org. The coalition is dedicated to raising awareness, educating the public and policymakers, and offering solutions that will better prepare and protect consumers, taxpayers and the American economy from major catastrophes in a sensible, cost-effective fashion. A comprehensive solution is being advanced that includes the development of government sponsored, privately funded catastrophe funds at the state and national levels; improved prevention and mitigation measures, including the adoption of more effective land use policies and stronger building codes; enhanced public education about catastrophe risk; better catastrophe relief, recovery and rebuilding processes; and a rigorous process of continuous improvement for catastrophe preparedness and response programs and processes.
This current report on Form 8-K contains forward-looking statements about changes in the Registrant’s reinsurance program, the related premium and reductions in costs. These statements are subject to the Private Securities Litigation Reform Act of 1995 and are based on management’s estimates, assumptions and projections. The actual changes to the reinsurance program, related premium and cost reductions may differ materially from those discussed in this report, depending on ongoing negotiations between the Registrant and participants in the reinsurance market, and the ability to reduce expenses to the desired level.
6
| EXCERPTS ON THIS PAGE:
RELATED TOPICS for ALL: |
| |||||||
