THG » Topics » . Reinsurance.

This excerpt taken from the THG 10-K filed Feb 27, 2009.

REINSURANCE

FACE="Times New Roman" SIZE="2">DECEMBER 31

(In millions)

STYLE="font-size:12px;margin-top:0px;margin-bottom:0px"> 




























































































































































































































































    Gross
amount
  Ceded to
other
companies
  Assumed
from
other
companies
  Net
amount
  Percentage
of amount
assumed to
net
 

2008 (1)FACE="Times New Roman" SIZE="2">

          

Premiums:

          

Property and casualty insurance

  $2,700.0  $241.9  $26.8  $2,484.9  1.08%
                    

2007 (1)FACE="Times New Roman" SIZE="2">

          

Premiums:

          

Property and casualty insurance

  $2,624.4  $285.2  $32.8  $2,372.0  1.38%
                    

2006 (1)FACE="Times New Roman" SIZE="2">

          

Premiums:

          

Property and casualty insurance

  $2,470.0  $293.7  $42.9  $2,219.2  1.93%
                    

 





(1)

Premiums related to our former life insurance business have been reclassified to Discontinued Operations due to the sale
of FAFLIC on January 2, 2009.

 


130







Table of Contents


These excerpts taken from the THG 10-K filed Feb 27, 2008.

REINSURANCE

Our reinsurance program consists of coinsurance and modified coinsurance agreements that reinsure substantially all of our variable life insurance and annuity business, universal life, individual disability income business and yearly renewable term business. Although reinsurance does not legally discharge the ceding insurer from its primary liability for the full amount of policies reinsured, it does make the reinsurers liable to the insurer to the extent of the reinsurance ceded. We maintain a gross reserve for reinsurance liabilities. We ceded 13% of our statutory individual life insurance premiums in 2007. Based on a review of our reinsurers’ financial positions and reputations in the marketplace, we believe that our reinsurers are financially sound.

REINSURANCE

Our reinsurance program
consists of coinsurance and modified coinsurance agreements that reinsure substantially all of our variable life insurance and annuity business, universal life, individual disability income business and yearly renewable term business. Although
reinsurance does not legally discharge the ceding insurer from its primary liability for the full amount of policies reinsured, it does make the reinsurers liable to the insurer to the extent of the reinsurance ceded. We maintain a gross reserve for
reinsurance liabilities. We ceded 13% of our statutory individual life insurance premiums in 2007. Based on a review of our reinsurers’ financial positions and reputations in the marketplace, we believe that our reinsurers are financially
sound.

This excerpt taken from the THG 10-K filed Mar 1, 2007.

REINSURANCE

Our reinsurance program consists of coinsurance and modified coinsurance agreements that reinsure substantially all of our variable life insurance and annuity business, universal life, individual disability income business and yearly renewable term business. Although reinsurance does not legally discharge the ceding insurer from its primary liability for the full amount of policies reinsured, it does make the reinsurers liable to the insurer to the extent of the reinsurance ceded. We maintain a gross reserve for reinsurance liabilities. We ceded 17% of our statutory individual life insurance premiums in 2006. Based on a review of our reinsurers’ financial positions and reputations in the marketplace, we believe that our reinsurers are financially sound.

This excerpt taken from the THG 10-K filed Mar 16, 2006.

REINSURANCE

Our Property and Casualty group maintains a reinsurance program designed to protect against large or unusual losses and allocated LAE activity. This includes excess of loss reinsurance, proportional (quota-share) and catastrophe reinsurance. We determine the appropriate amount of reinsurance based on our evaluation of the risks accepted and analyses prepared by consultants and/or reinsurers, and on market conditions including the availability and pricing of reinsurance. Reinsurance contracts do not relieve us from our primary obligations to policyholders. Failure of reinsurers to honor their obligations could result in losses to us. We believe that the terms of our reinsurance contracts are consistent with industry practice in that they contain standard terms with respect to lines of business covered, limit and retention, arbitration and occurrence. Based on an ongoing review of our reinsurers’ financial statements, reported financial strength ratings from rating agencies and the analysis and guidance of our reinsurance intermediaries, we believe that our reinsurers are financially sound.

Catastrophe reinsurance serves to protect the ceding insurer from significant losses arising from a single event or aggregate events such as windstorm, hail, hurricane, tornado, riot or other extraordinary events. Under our catastrophe reinsurance agreements, we ceded $329.4 million of losses in 2005, primarily as a result of Hurricane Katrina, and to a lesser extent, Hurricane Rita. Due to the significant impact of recent storms, we believe the availability and pricing of reinsurance will be

 

39


Table of Contents

negatively impacted. See also “Reinsurance” in Item 1 – Business on pages 13 to 16 of this Form 10-K for further information on our reinsurance programs.

We are subject to concentration of risk with respect to reinsurance ceded to various residual market mechanisms. As a condition to the ability to conduct certain businesses in various states, we are required to participate in various residual market mechanisms and pooling arrangements which provide various insurance coverage to individuals or other entities that are otherwise unable to purchase such coverage. These market mechanisms and pooling arrangements include the Massachusetts Commonwealth Automobile Reinsurers and the Michigan Catastrophic Claims Association.

This excerpt taken from the THG 8-K filed Aug 24, 2005.
. Reinsurance. Schedule 3.22 sets forth a true, complete and correct list of all reinsurance and retrocession treaties and agreements in force as of the date of this Agreement to which FAFLIC (to the extent included in the Core Business) or the Company is a ceding or assuming party and which are included in the Business (collectively, the “
This excerpt taken from the THG 10-K filed Feb 25, 2005.

REINSURANCE

 

Our Property and Casualty group maintains a reinsurance program designed to protect against large or unusual losses and allocated LAE activity. This includes excess of loss reinsurance, proportional and catastrophe reinsurance. We determine the appropriate amount of reinsurance based on our evaluation of the risks accepted and analyses prepared by consultants and/or reinsurers, and on market conditions including the availability and pricing of reinsurance. Reinsurance contracts do not relieve us from our primary obligations to policyholders. Failure of reinsurers to honor their obligations could result in losses to us. We believe that the terms of our reinsurance contracts are consistent with industry practice in that they contain standard terms with respect to lines of business covered, limit and retention, arbitration and occurrence. Based on a review of our reinsurers’ financial statements and reputations in the reinsurance marketplace, we believe that our reinsurers are financially sound.

 

ALLMERICA FINANCIAL ANNUAL REPORT 2004

  34    


Table of Contents

Catastrophe reinsurance serves to protect the ceding insurer from significant losses arising from a single event or aggregate events such as windstorm, hail, hurricane, tornado, riot or other extraordinary events. Under our catastrophe reinsurance agreements, we ceded $41.5 million of losses in 2004 primarily as a result of four large catastrophes that occurred in 2004.

 

In 1999, we entered into a whole account aggregate excess of loss reinsurance agreement, which provides coverage for accident year 1999 for our property and casualty business. The program covered losses and allocated LAE, including those incurred but not yet reported, in excess of a specified whole account loss and allocated LAE ratio. As a result of this agreement, we recognized net expenses of $4.2 million, $5.3 million and $4.0 million for the years ended December 31, 2004, 2003 and 2002, respectively, based on estimates of losses and allocated LAE for accident year 1999. The effect of this agreement on the results of operations in future periods is not currently determinable, as it will be based both on future losses and allocated LAE for accident year 1999.

 

We are subject to concentration of risk with respect to reinsurance ceded to various residual market mechanisms. As a condition to the ability to conduct certain business in various states, we are required to participate in various residual market mechanisms and pooling arrangements which provide various insurance coverage to individuals or other entities that are otherwise unable to purchase such coverage. These market mechanisms and pooling arrangements include the Massachusetts Commonwealth Automobile Reinsurers and the Michigan Catastrophic Claims Association.

 

Wikinvest © 2006, 2007, 2008, 2009, 2010, 2011, 2012. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.
Powered by MediaWiki