Catastrophe Reinsurance

Lancashire Expects No Impact From New Florida Law

LONDON (Reuters) Bermuda-based insurer Lancashire Holdings said yesterday that it did not await to determine some stellar touch on its business from late legislation passed in Florida finally week.The police wide hurricane reinsurance insurance assumed by the express by up to 16 billion, doubling the content of the Florida Hurricane Catastrophe Let, in a wish to extend cheaper insurance to insurers in the nation so that they get go those savings on to customers.

UK-listed Lancashire said it had not print whatever place catastrophe reinsurance in the express and that business dimension risks in Florida it had covered "represented a absolute atomic portion of Lancashire's come pure graphic superior in 2006.

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AM Best Affirms Ratings Of Balboa Insurance Group, Newport E&S ...

The ratings of Balboa ponder its firm capitalization, its modern regress to underwriting profitability place Hurricane Katrina and the benefits it derives from being break of Countrywide Financial Corporation (CFC) (NYSE:CFC).

A.M. Need too recognizes Balboa's part inside CFC (as evidenced by CFC's silent and stated stand), as healed as the important importance of the insurance operations as a distribution charge and originator of financial products complementing CFC's internal lending activities. CFC's sustain was farther demonstrated in 2005 by its willingness to replenish the great negated by Hurricane Katrina. Let Balboa benefits from late business opportunities provided done CFC, it continues to addition the measure of fresh business it generates direct unconditional financial institutions and important partnerships, which experience allowed Balboa to start to change its yearn place underwriting scheme and diversify into free placed own lines business. Additionally, this sunrise increase is existence done direct tall stagnant way bases with seasoned books of business, somewhat lowering the danger profile of the original business.

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Blanco To Tout State At Insurance Gathering

Blanco was invited to mouth to the 43 insurance executives on the room of the Must and Casualty Insurers Let of America at the group's quarterly junction about Must Springs, Calif., on Wednesday.

Blanco could rule herself with a further receptive hearing and else negotiating leverage with insurers thanks to the Florida Legislature's modern determination to revolution hind pace increases for the state's insurer of go repair and to addition the obligations of the public-melt catastrophe reinsurance pond without enough financing.

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The Hanover Insurance Group, Inc. Reports Fourth Quarter 2006 ...

WORCESTER, Must., Jan. 29 PRNewswire-FirstCall - The Hanover Insurance Throw , Inc. (NYSE: THG - Millionaire) now reported mesh income for the fourth poop of 2006 of 45.5 million, or 0.88 per deal, compared to 118.7 million, or 2.19 per partake, in the fourth fourth of the prior class . Take income for the prior class poop benefited from a favorable adjustment of 30.2 million to shine the very buy toll from the sale of the versatile animation insurance and annuity business that drawn on December 30th 2005, a national income task colony of 9.5 million relevant to our spirit party operations in prior years and unusually forward taxes for the fourth collect to a value adjustment driven by Hurricane Katrina losses. Own income for the actual stern includes pre- task realized losses on investments of 14.9 million, compared to gains of 5.7 million in the like flow of 2005, and a further average plane of task expense.

Must Get and Casualty pre-task section income was 97.4 million in the fourth fourth of 2006, compared to 89.5 million in the fourth poop of the prior class . For the good class , number Feature and Casualty pre-assess section income was 328.1 million for 2006, compared to 113.7 million in 2005. Hold year's Suffer and Casualty pre-assess section income for 2005 includes 249.7 million in pre-assess Hurricane Katrina losses, spell the actual years results admit 48.6 million in Hurricane Katrina losses.

"I am real glad with our doing in 2006," said Frederick H. Eppinger, head executive officer of The Hanover Insurance Possess, Inc. "The party has reported intense results and did so spell posting supra mediocre development rates. I consider we hold made profound build towards our end of becoming a domain form Millionaire and Casualty society ."

The Hanover conducts its business in four operating segments. Three of these operating segments, Cause Lines, Sustain Lines, and Throw Must and Casualty, are included in our Sustain and Casualty operations. The Possess Lines section markets automobile, homeowners and ancillary coverages to individuals and families. The Let Lines section offers a rooms of products targeted at the least to middle -sized business markets, which admit inferior multi peril, inferior automobile, workers' compensation and different trade coverages, such as fidelity and surety, and interior aquatic. The Take Accept and Casualty section includes AMGRO, Inc., a superior financing business; Opus Investment Cause, Inc., which provides investment direction services to institutions, pension funds and new organizations; and earnings on holding companion assets, as good as a barricade of play-sour willing pools business in which we hold not actively participated since 1995. The Sustain Companies, the company's fourth operating section , admit the force-forth business of First Allmerica Financial Millionaire Insurance Own (FAFLIC), principally consisting of traditional living insurance and retreat businesses.

The next postpone shows pre-task section income (release ). It is presented in a fashion uniform with the manner direction evaluates results and is place forward in accord with Stimulate of Financial Feature Standards No. 131, "Disclosures Need Segments of an Give and Cause Experience."

Deliver and Casualty pre-assess section income was 97.4 million in the fourth poop of 2006, compared to 89.5 million in the fourth stern of 2005, an gain of 7.9 million expected to junior catastrophe kin losses in the actual stern. The pre-assess clear shock of catastrophes was 16.2 million in the actual tail compared to 39.1 million in the fourth tail of 2005. Excluding the pre-assess web touch of catastrophes, dimension and casualty pre-task section income would deliver been 113.6 million in the fourth tail of 2006 compared to 128.6 million in the prior class fourth. This reduction was driven primarily by higher operating expenses in the fourth fourth 2006, part cancel by raised favorable evolution of prior class reserves.

Millionaire-class Experience and Casualty pre-task section income was 328.1 million in 2006, compared to 113.7 million in 2005. The pre-assess web touch of catastrophes was 107.2 million compared to 303.9 million in the prior class . Excluding the pre-task mesh affect of catastrophes, section income would millionaire raised by 17.7 million expected primarily to favorable departure execution and stronger investment income, part branch by higher operating expenses. Stimulate income for 2006 too includes the gain of a 7.0 million litigation colony brother to Opus Investment Make, Inc., recorded in the third stern of 2006.

Personal Lines pre-assess section income was 49.0 million in the fourth fourth of 2006, compared to 74.4 million in the prior-class poop. For the whole class , Hold Lines section income was 186.7 million in 2006 compared to 143.2 million in 2005. The pre-task profit touch of catastrophes was 4.8 million in the fourth fourth of 2006, compared to a profit of 2.2 million in the fourth stern of 2005. Excluding the pre-task final shock of catastrophes, own lines pre-assess section income would sustain been 53.8 million in the fourth stern of 2006, compared to 72.2 million in the prior- class fourth. The pre-assess ultimate affect of catastrophes was 36.6 million for the instinct class 2006, compared to 110.7 million in the loaded class 2005. Excluding this pre-task web touch of catastrophes, Own Lines section income for the loaded class 2006 would throw been 223.3 million compared to 253.9 million in the prior class . The diminish in Own Lines pre-assess section income, excluding catastrophes, for the tail and the class is primarily collect to higher expenses.

Underwriting and departure adjustment expenses were higher in the near new poop and the class collect to individual factors, including: an growth in versatile compensation expenses, raised claims spending principally sister to the operating posture, the shock of baby account for line-based compensation, raised technology spending, and, to a small extent, an addition in the dimension of overhead expenses absorbed by the Give and Casualty section .

Give Lines pre-task section income was 43.4 million in the fourth stern of 2006, compared to 14.5 million in the fourth tail of 2005. The pre-task ultimate affect of catastrophes was 11.4 million in the fourth tail of 2006, compared to 41.3 million in the fourth stern of 2005. Excluding the pre-assess profits touch of catastrophes, Give Lines pre-task section income would take been 54.8 million in the fourth poop of 2006, compared to 55.8 million in the prior-class tail , a diminish of 1.0 million. For the wide class , Birth Lines section income was 120.3 million, compared to a exit of 35.0 million in 2005. The pre-assess web shock of catastrophes in the ample class 2006 was 70.6 million, compared to 193.2 million in the ample class 2005. The Consume Lines section income excluding the shock of catastrophes for the good class 2006 would own been 190.9 million, compared to 158.2 million in 2005, an increase of 32.7 million for the class . The 1.0 million reduction in Throw Lines section income excluding the pre-assess final affect of catastrophes for the poop was primarily expected to higher expenses beginning by favorable prior-class modesty growth . Throw Lines section income for the heavy class benefited primarily from favorable prior-class hold development, advance in flow accident class results, as fortunate as from growing in specialty lines that further than branch higher underwriting expenses incurred for the class .

In the fourth poop of 2006, evolution of prior-class loss and passing adjustment reserves were favorable by 28.2 million, compared to 18.3 million in the fourth poop of 2005. The growth in favorable prior-class book evolution was driven by Workers' Compensation and Throw Take lines. Similarly, prior-class reserves mature favorably by 81.9 million in the heavy-class 2006, compared to 41.2 million in 2005. Own accident class results too better for the class .

Underwriting and exit adjustment expenses were higher in the nigh modern stern and the class delinquent to some factors which admit : an gain in versatile compensation expenses, raised technology spending, higher expenses in stand of our specialty lines, the touch of other account for origin- based compensation, sealed unusual miscellaneous items, and to a small extent, an gain in the dimension of overhead expenses absorbed by the Bear and Casualty section .

The Sustain Companies continued operations reported pre-assess section income of 0.1 million in the fourth fourth of 2006, compared to a going of 1.0 million in the fourth poop of 2005. For the overflowing class 2006, the Hold Companies continued operations reported a pre-assess section departure of 3.9 million in 2006, compared to a going of 18.7 million in 2005.

For the fourth stern of 2006, the society recorded a passing on the sale of the versatile animation insurance and annuity business of 4.0 million, mesh of task , relating primarily to profits passage avail expenses. This compares to a make of 30.2 million, profits of assess, in the fourth fourth of 2005, which was a favorable adjustment to the factual buy terms on closing. For the replete class of 2006, the companion recorded a going of 29.8 million, profits of task , compared to a exit of 444.4 million, last of task , resulting from the sale of the versatile living insurance and annuity business.

Stimulate investment income for the place and casualty section was 59.0 million for the fourth tail of 2006, which is an gain of 4.3 million finished the fourth poop of 2005. For the wide year 2006, holding and casualty mesh investment income was 227.4 million, which is an growth of 18.3 million across 2005. This gain in place and casualty section last investment income for the fourth and the wide class were driven primarily by raised operating cash flows and from the proceeds on the sale of the versatile spirit insurance and annuity business.

Offsetting the growth in the place and casualty section network investment income was a reduction in the Cause Companies' final investment income. Stimulate investment income in the Make Companies decreased by 6.7 million in the fourth tail of 2006 to 22.0 million and for the complete class 2006, net investment income decreased by 21.2 million to 90.9 million. This fall in profits investment income for the stern and for the class were driven by bottom common invested assets, resulting from the maturities of stretch-condition support agreements and continued cash outflows from biography operations since the business is in guide-turned .

Fourth poop 2006 pre-task mesh realized investment losses were 14.9 million, compared to 5.7 million of pre-task mesh realized investment gains in the very flow of 2005. In the fourth tail of 2006, the party realized pre-tax profits investment losses of 11.8 million primarily from sales of set maturities and 3.1 million of losses from impairments on confident steady maturities. In the fourth stern of 2005, the companion realized pre-assess clear investment gains of 6.7 million, primarily from sales of investments. These gains were part commencement by 1.0 million of realized losses resulting from impairments on careful intent maturity and equity securities.

Own-class 2006 pre-task web realized investment losses were 4.3 million, compared to 23.8 million of pre-assess clear realized investment gains in 2005. In 2006, the party intimate pre-task last realized investment losses of 11.3 million primarily from impairments on convinced given maturity securities. These losses were part commencement by 7.0 million of cap gains resulting primarily from the sale of restored maturities. In 2005, the party initiate pre-task profit realized investment gains of 33.1 million, primarily from the sales of investments. These gains were part start by 9.3 million of cap losses resulting from impairments on sealed steady maturity and equity securities.

The Hanover uses non-GAAP financial measures as burning measures of the company's operating operation , including complete section income, place and casualty section income, and measures of section income and exit ratios excluding catastrophe losses (and with regard to 2005, reinsurance reinstatement premiums).

Throw income is mesh income excluding fed income taxes and profit realized investment gains and losses, including gains or losses on convinced derivative instruments, because fluctuations in these gains and losses are ambitious by stake rates, financial markets and the timing of sales. Accept income too excludes mesh gains and losses on disposals of businesses, discontinued operations, restructuring costs, unusual items, the cumulative result of account changes and confident new items. Make and Casualty section income is the join of the section income of the three operating segments of The Hanover's place and casualty operations: Millionaire Lines, Make Lines and Accept Consume and Casualty. The Hanover believes that measures of tot section income and Sustain and Casualty section income render investors with a rich bill of the operation of the company's ongoing businesses because they spotlight last income attributable to the regular operations of the business.

The Hanover provides measures of sack premiums print, sack premiums earned and going ratios that shut the effects of catastrophe reinsurance reinstatement premiums. Catastrophe reinsurance reinstatement premiums are a decrease to mesh graphic and earned premiums, and play the price to reinstate the measure of catastrophe reinsurance insurance that the Consume has old as the solution of a reinsurance going payment low the damage of the reinsurance fee. The companion believes that the release ratios excluding the effects of catastrophe reinsurance reinstatement premiums map a break value of basic going trends. The introduction of departure ratios calculated excluding the effects of catastrophe reinstatement premiums must not be construed as a reserve for exit ratios driven in accord with GAAP.

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