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0001193125-08-219605.txt : 20081030
0001193125-08-219605.hdr.sgml : 20081030
20081030061718
ACCESSION NUMBER: 0001193125-08-219605
CONFORMED SUBMISSION TYPE: 8-K
PUBLIC DOCUMENT COUNT: 6
CONFORMED PERIOD OF REPORT: 20081030
ITEM INFORMATION: Results of Operations and Financial Condition
ITEM INFORMATION: Financial Statements and Exhibits
FILED AS OF DATE: 20081030
DATE AS OF CHANGE: 20081030
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: ASSURANT INC
CENTRAL INDEX KEY: 0001267238
STANDARD INDUSTRIAL CLASSIFICATION: ACCIDENT & HEALTH INSURANCE [6321]
IRS NUMBER: 391126612
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 8-K
SEC ACT: 1934 Act
SEC FILE NUMBER: 001-31978
FILM NUMBER: 081149110
MAIL ADDRESS:
STREET 1: ONE CHASE MANHATTAN PLAZA
CITY: NEW YORK
STATE: NY
ZIP: 10005
8-K
1
d8k.htm
FORM 8-K
Form 8-K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report: October 30, 2008
Assurant, Inc.
(Exact Name of Registrant as Specified in Charter)
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Delaware |
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001-31978 |
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39-1126612 |
(State or Other Jurisdiction of Incorporation) |
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(Commission File Number) |
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(I.R.S. Employer Identification No.) |
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One Chase Manhattan Plaza, 41st Floor New York, New York |
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10005 |
(Address of Principal Executive Offices) |
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(Zip Code) |
Registrants telephone number, including area code: (212) 859-7000
N/A
(Former Name or Former Address,
if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
¨ |
Written communications pursuant to Rule 425 under the Securities Act (17 CR 230.425) |
¨ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 |
Results of Operations and Financial Condition |
On
October 30, 2008, Assurant, Inc. issued a press release announcing its financial results for the quarter ended September 30, 2008. The text of the press release, attached hereto as Exhibit 99.1, and the financial supplement which
accompanied the press release, attached hereto as Exhibit 99.2, are each incorporated by reference into this Item. The press release and financial supplement are furnished and not filed pursuant to instruction B.2 of Form 8-K.
Item 9.01 |
Financial Statements and Exhibits |
Exhibits
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99.1 |
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Press Release Dated October 30, 2008. |
99.2 |
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Financial Supplement as of September 30, 2008 |
- 2 -
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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ASSURANT, INC. |
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Date: October 30, 2008 |
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By: |
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/s/ Bart Schwartz |
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Bart Schwartz |
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Executive Vice President, Chief Legal Officer & Secretary |
- 3 -
EX-99.1
2
dex991.htm
PRESS RELEASE DATED OCTOBER 30, 2008
Press Release Dated October 30, 2008
Exhibit 99.1
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Press Contact: |
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Investor Relations: |
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Drew Guthrie |
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Melissa Kivett |
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John Egan |
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Manager, Communications |
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Senior Vice President |
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Vice President |
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and Media Relations |
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Investor Relations |
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Investor Relations |
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Phone: 212-859-7002 |
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Phone: 212-859-7029 |
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Phone: 212-859-7197 |
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Fax: 212-859-5893 |
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Fax: 212-859-5893 |
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Fax: 212-859-5893 |
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drew.guthrie@assurant.com |
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melissa.kivett@assurant.com |
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john.egan@assurant.com |
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FOR IMMEDIATE RELEASE
Assurant Reports Q3 2008 Net Operating Income of $83.1 Million
or $0.70 per diluted
share;
Q3 2008 Net Loss of $111.4 Million or ($0.95) per diluted share
New York October 30, 2008 Assurant, Inc. (Assurant) (NYSE: AIZ), a premier provider of specialized insurance and insurance-related
products and services, today reported its results for the third quarter of 2008 and the nine months ended September 30, 2008.
Robert B. Pollock,
president and chief executive officer, said: Assurant demonstrated resilience, an essential quality for any business during turbulent times. Despite unprecedented volatility in the capital markets and a very active hurricane season we
continued to execute on our diversified specialty strategy. We were pleased to complete two important acquisitions during the quarter.
A
changing environment creates opportunities and our solid capital position and disciplined risk management have us positioned to evaluate and respond to situations to create long term value for our shareholders, Mr. Pollock concluded.
Third Quarter Results
Assurants net loss in the
third quarter of 2008 was $111.4 million, or ($0.95) per diluted share, compared to net income of $187.2 million, or $1.56 per diluted share in the third quarter 2007. Net income declined primarily due to investment impairments and reportable
catastrophe losses. The Company had $194.5 million after-tax of net realized investment losses, which included $148.9 million after-tax of other-than- temporary impairments in the third quarter of 2008, compared to $8.5 million of net
after-tax realized losses on investments in the third quarter of 2007. Assurant incurred $86.2 million after-tax in reportable catastrophe losses, net of
reinsurance, in an active hurricane season. This is in contrast to an exceptionally benign catastrophe season in the third quarter of 2007, during which there were no reportable catastrophe losses.
Net operating income (see footnote 1 at the end of this release) for the third quarter of 2008 decreased 58% to $83.1 million, or $0.70 per diluted share, compared to
third quarter 2007 net operating income of $195.7 million, or $1.63 per diluted share. The decrease was primarily the result of reportable catastrophe-related losses for Assurant Specialty Property and less favorable results from Assurant Solutions
and Assurant Health.
Net earned premiums of $1.98 billion in the third quarter of 2008 increased 5% from $1.89 billion in the third quarter of 2007,
driven primarily by growth in Assurant Specialty Property and Assurant Solutions.
Net investment income in the third quarter of 2008 decreased 1% to
$192.3 million from $194.0 million in the third quarter of 2007 primarily as a result of a decrease in average invested assets and an increase in the percentage of our investment portfolio allocated to tax-advantaged assets.
Nine-Month Results
Net income in the first nine months of 2008 was
$265.4 million, or $2.23 per diluted share, a decrease of 50%, compared to net income of $532.9 million, or $4.37 per diluted share, for the first nine months of 2007. Net income declined primarily due to investment impairments and reportable
catastrophe losses. Results include $244.9 million after-tax of net realized losses on investments, including $195.1 million after-tax of other-than-temporary impairments, compared to $6.9 million after-tax of net realized losses on investments in
the first nine months of 2007. In addition, Assurant had $86.2 million after-tax in reportable catastrophe losses from hurricanes Gustav and Ike and reported $11.5 million of after tax catastrophe losses in the second quarter 2008. In the second
quarter 2008, the Company reported Insurance Services Office (ISO) catastrophe related losses excluding incurred but not reported losses due to the high frequency of storms. This was in contrast to a benign catastrophe season in the nine months of
2007, during which Assurant had no reportable catastrophe losses. Results for the first nine months of 2008 include $26.6 million after-tax gain from the sale of an inactive life insurance subsidiary.
Net operating income for the first nine months of 2008 was $483.7 million, or $4.06 per diluted share, a decrease of 10% compared to net operating income of $539.8
million, or $4.42 per diluted share, for the first nine months of 2007. Net operating income excludes net realized capital gains and losses and other unusual, or non-recurring items.
Net earned premiums of $5.92 billion in the first nine months of 2008 increased 9% from $5.45 billion in the first nine months of 2007 primarily from growth in Assurant Specialty Property and Assurant Solutions.
2
Net investment income in the first nine months of 2008 decreased 2% to $591.3 million from $601.2 million in the first
nine months of 2007 primarily resulting from a decrease in average invested assets and an increase in the percentage of our investment portfolio allocated to tax-advantaged assets. Income from real estate joint venture partnerships in the first nine
months of 2008 was $3.5 million compared with $37.0 million in the first nine months of 2007. Investment income from real estate joint venture partnerships is disclosed by segment (page 8, 9, 12, and 14) in our financial supplement.
The following chart provides a reconciliation of net operating income to net income:
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For the Three Months Ended |
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For the Nine Months Ended |
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September 30, 2008 |
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September 30, 2007 |
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September 30, 2008 |
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September 30, 2007 |
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(UNAUDITED) |
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(amounts in millions, net of tax) |
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Assurant Solutions |
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$ |
20.4 |
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$ |
37.4 |
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$ |
100.3 |
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$ |
111.7 |
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Assurant Specialty Property |
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30.9 |
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114.7 |
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286.7 |
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279.3 |
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Assurant Health |
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30.2 |
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39.4 |
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95.2 |
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113.7 |
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Assurant Employee Benefits |
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21.5 |
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20.4 |
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56.4 |
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70.8 |
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Corporate and other |
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(14.8 |
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(11.7 |
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(39.5 |
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(22.1 |
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Amortization of deferred gain on disposal of businesses |
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4.8 |
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5.4 |
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14.4 |
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16.2 |
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Interest expense |
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(9.9 |
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(9.9 |
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(29.8 |
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(29.8 |
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Net operating income |
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83.1 |
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195.7 |
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483.7 |
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539.8 |
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Adjustments: |
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Net realized (losses) on investments |
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(194.5 |
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(8.5 |
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(244.9 |
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(6.9 |
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Gain on sale of inactive subsidiary |
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26.6 |
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Net (loss) income |
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$ |
(111.4 |
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$ |
187.2 |
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$ |
265.4 |
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$ |
532.9 |
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Assurant Solutions
Assurant Solutions third quarter 2008 net operating income was $20.4 million, a 45% decrease from third quarter 2007 net operating income of $37.4 million. Results for the third quarter 2008 declined primarily as a
result of higher domestic and international combined ratios. Domestic combined ratios increased in the quarter primarily as a result of an $11.8 million pre-tax charge from the acquisition of GEs Warranty Management Group and less favorable
domestic service contract loss experience. The international combined ratio increased to 105.6% as a result of less favorable credit insurance loss experience in the United Kingdom and higher expenses in developing countries in the third quarter of
2008. These increases were partially offset by favorable client settlements related to reserves previously established for a credit life product in Brazil. Net operating income for the first nine months of 2008 was $100.3 million, down 10% from
$111.7 million for the first nine months of 2007. Results for the first nine months of 2008 declined primarily due to less favorable loss experience in our international business and higher expenses in our developing countries. Results for the first
nine months of 2008 had $9.4 million less of after-tax investment income from real estate joint venture partnerships compared to the same period in 2007.
3
A schedule of disclosed items that affected our quarterly results by segment for the last seven quarters can be found in
our financial supplement on page 19.
Assurant Solutions third quarter 2008 net earned premiums increased 9% to $707.1 million from $649.9 million in the
third quarter of 2007. Net earned premiums for the first nine months of 2008 were $2.09 billion, up 13% from $1.85 billion for the first nine months of 2007. The increase for the quarter and first nine months of 2008 was primarily driven by
continued growth in domestic and international service contracts and growth in preneed. Results were partially offset by a continued decline in premiums related to the domestic independent runoff in preneed and domestic credit insurance.
Assurant Specialty Property
Assurant Specialty Property
third quarter 2008 net operating income was $30.9 million, down 73% from $114.7 million in the third quarter 2007. The decrease for the quarter was primarily driven by an active hurricane season resulting in $86.2 million after-tax of reportable
catastrophe losses, net of reinsurance, from large hurricanes Gustav and Ike and $8.6 million after-tax of catastrophe reinsurance re-instatement premiums and related expenses. Third quarter 2007 results included income of $2.3 million after-tax
from a project to improve the reconciliation of certain client commissions payable accounts. Despite reported catastrophe losses of $97.7 million net of reinsurance for the nine months, net operating income for the first nine months of 2008
increased 3% to $286.7 million compared to $279.3 million in 2007 due to growth in our creditor-placed homeowners insurance. There were no reportable catastrophe losses during the third quarter or the first nine months of 2007 due to an
exceptionally benign hurricane season.
Assurant Specialty Property third quarter net earned premiums increased 15%, to $513.2 million compared to $445.2
million in the third quarter of 2007. Net earned premiums for the first nine months of 2008 increased 27% to $1.53 billion compared to $1.21 billion for the same period in 2007. The third quarter and nine months of 2008 include increased reinsurance
costs of $26.6 million for the quarter and $17.5 million for the year, including reinstatement premiums of $13.2 million for third quarter and year to date. The increases for the quarter and the first nine months are primarily the result of
continued growth in creditor-placed homeowners insurance as average insured values increased 15% to $173,000 in the quarter and policy penetration rates continue to rise. Partially offsetting these factors was a net decrease in tracked loans in the
period due to continued market consolidation and the declining inventory of subprime loans.
4
Assurant Health
Assurant Health third quarter 2008 net operating income was $30.2 million, a decrease of 23% compared to third quarter 2007 net operating income of $39.4 million. Net operating income for the first nine months of 2008 was $95.2 million, a
decrease of 16% compared to $113.7 million for the first nine months of 2007. The decrease for the quarter and first nine months in 2008 was driven primarily by the continued decline in small group medical premiums and an increase in the combined
ratio due to less favorable individual medical loss experience.
Assurant Health third quarter 2008 net earned premiums decreased 5% to $486.7 million from
$514.2 million in the third quarter of 2007. Net earned premiums for the first nine months of 2008 decreased 5% to $1.47 billion compared to $1.54 billion for the first nine months of 2007. Individual medical premiums for the quarter and first nine
months of 2008 were down slightly while small group premiums declined by 15% for the quarter and by 14% for the nine months.
Assurant Employee
Benefits
Assurant Employee Benefits third quarter 2008 net operating income was $21.5 million, up 5% from third quarter 2007 net operating income
of $20.4 million. Results for the third quarter of 2008 benefited from favorable loss experience compared to the prior years quarter. Net operating income during the first nine months of 2008 was $56.4 million, down 20% from $70.8 million in
the first nine months of 2007. Results for the first nine months of 2008 are lower as a result of $9.2 million less of after-tax investment income from real estate joint venture partnerships and less favorable loss experience compared to the same
period in 2007.
Assurant Employee Benefits third quarter 2008 net earned premiums decreased 2% to $277.1 million from $284.0 million in the third quarter
of 2007. Net earned premiums for the first nine months of 2008 decreased 3% to $830.8 million from $853.2 million in the first nine months of 2007. Net earned premiums for the third quarter of 2007 include $12.3 million in single premiums from
closed blocks of business. Net earned premiums in the first nine months of 2008 included $5.5 million in single premiums from closed blocks of business compared to $35.1 million in the first nine months of 2007. Excluding single premiums from closed
blocks of business, net earned premiums increased in the third quarter and for the first nine months of 2008.
5
Corporate and other
Corporate and other net operating loss for the third quarter of 2008 was $14.8 million, compared to a loss of $11.7 million in the third quarter of 2007. Losses increased in the third quarter of 2008 primarily as a result of lower net
investment income and $4.0 million in tax expenses resulting from changes in certain tax liabilities. Assurant incurred $2.1 million of after-tax expenses related to the SEC investigation regarding certain loss mitigation products; however Assurant
also received a $2.1 million after-tax recovery of certain SEC investigation expenses from its director and officer insurance coverage.
For the first nine
months of 2008 net operating loss was $39.5 million compared to a loss of $22.1 million for the same period last year. Net operating loss increased as a result of an increase in expenses related to the SEC investigation, lower investment income and
higher severance and previously announced supplemental executive retirement plan expenses.
Financial Position
At September 30, 2008 total assets were $25.4 billion. Stockholders equity, excluding accumulated other comprehensive income (AOCI), was $4.2
billion and book value per diluted share, excluding AOCI, was up 6% to $35.60 from $33.73 at December 31, 2007. Debt to total capital, excluding AOCI, was 18.9% compared to 19.7% at December 31, 2007.
AOCI is composed of foreign currency translation adjustments, net unrealized gains/losses on securities, and pension underfunding. Net unrealized gains and losses
represent the after-tax difference between the book value and market value of invested assets. At September 30, 2008, AOCI was ($475.8) million or ($4.03) per diluted share compared to $53.9 million, or $.45 per diluted share, at
December 31, 2007, Invested assets at market value, excluding cash and equivalents, as a ratio of shareholders equity including AOCI was 3.4 to 1 at September 30, 2008.
At September 30, 2008 Level 1 and Level 2 investment assets as defined under GAAP accounting rules comprise 98.4% of our total investment portfolio.
Please refer to Assurants new investment disclosure in the financial supplement (pages 17, 20 and 21) for issuer type (including an industry breakout), top 30 issuers and a commercial mortgage loan summary.
6
Earnings Conference Call
Assurant will host a conference call today at 10:00 A.M. (ET) with access available via Internet and telephone. Investors and analysts may participate in the live conference call by dialing 888-603-6873 (toll-free domestic) or 973-582-2706
(international); passcode: 29716245. Please call to register at least 10 minutes before the conference call begins. A replay of the call will be available for one week via telephone starting at approximately 1:00 P.M. (ET) today and can be accessed
at 800-642-1687 (toll-free domestic) or 706-645-9291 (international); passcode: 29716245. The webcast will be archived on Assurants website.
About Assurant
Assurant is a premier provider of specialized insurance products and related services in North America and selected other
international markets. The four key businesses Assurant Solutions; Assurant Specialty Property; Assurant Health; and Assurant Employee Benefits have partnered with clients who are leaders in their industries and have built leadership
positions in a number of specialty insurance market segments in the U.S. and selected international markets. The Assurant business units provide debt protection administration; credit-related insurance; warranties and service contracts; pre-funded
funeral insurance; creditor-placed homeowners insurance; manufactured housing homeowners insurance; individual health and small employer group health insurance; group dental insurance; group disability insurance; and group life insurance.
Assurant, a Fortune 500 company and a member of the S&P 500, is traded on the New York Stock Exchange under the symbol AIZ. Assurant has more than $25
billion in assets and $8 billion in annual revenue. Assurant has approximately 14,000 employees worldwide and is headquartered in New Yorks financial district. www.assurant.com.
Safe Harbor Statement
Some of the statements included in this press
release and its exhibits, particularly those anticipating future financial performance, business prospects, growth and operating strategies and similar matters, are forward-looking statements that involve a number of risks and uncertainties. You can
identify these statements by the fact that they may use words such as will, anticipate, expect, estimate, project, intend, plan, believe,
target, forecast, or the negative versions of those words and terms with a similar meaning. Our actual results might differ materially from those projected in the forward-looking statements. The Company undertakes no
obligation to update any forward-looking statements in this earnings release or the exhibits as a result of new information or future events or developments.
The following risk factors could cause our actual results to differ materially from those currently estimated by management: (i) failure to maintain significant client
7
relationships, distribution sources and contractual arrangements; (ii) failure to attract and retain sales representatives; (iii) general global
economic, financial market and political conditions (including difficult conditions in financial, capital and credit markets and the global economic slowdown including fluctuations in interest rates, mortgage rates, monetary policies and
inflationary pressure); (iv) inadequacy of reserves established for future claims losses; (v) failure to predict or manage benefits, claims and other costs; (vi) diminished value of invested assets in our investment portfolio (due to,
among other things, the recent volatility in financial markets and the global economic slowdown, credit and liquidity risk, environmental liability exposure and inability to target an appropriate overall risk level); (vii) losses due to natural
and man-made catastrophes; (viii) unavailability, inadequacy and unaffordable pricing of reinsurance coverage; (ix) inability of reinsurers to meet their obligations; (x) insolvency of third parties to whom we have sold or may sell
businesses through reinsurance or modified co-insurance; (xi) credit risk of some of our agents in Assurant Specialty Property and Solutions; (xii) a further decline in the manufactured housing industry; (xiii) a decline in our credit
or financial strength ratings (including the currently heightened risk of ratings downgrades in the insurance industry); (xiv) failure to effectively maintain and modernize our information systems; (xv) failure to protect client
information and privacy; (xvi) failure to find and integrate suitable acquisitions and new insurance ventures; (xvii) inability of our subsidiaries to pay sufficient dividends; (xviii) failure to provide for succession of senior
management and key executives; (xix) negative publicity and impact on our business due to unfavorable outcomes in litigation and regulatory investigations (including the potential impact on our reputation and business of a negative outcome in
the ongoing SEC investigation); (xx) significant competitive pressures in our businesses and cyclicality of the insurance industry: (xxi) current or new laws and regulations that could increase our costs or limit our growth.
For a detailed discussion of the risk factors that could affect our actual results, please refer to the risk factors identified in our SEC reports, including, but not
limited to, our upcoming Third Quarter 2008 10-Q and 2007 Annual Report on 10-K, as filed with the SEC.
Non-GAAP Financial Measures
Assurant uses the following non-GAAP financial measures to analyze the companys operating performance for the periods presented in this press
release. Because Assurants calculation of these measures may differ from similar measures used by other companies, investors should be careful when comparing Assurants non-GAAP financial measures to those of other companies.
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(1) |
Assurant uses net operating income as an important measure of the companys operating performance. As shown in the chart on page 3, net operating income equals
net income excluding net realized gains (losses) on investments and other unusual and/or infrequent items. The company believes net operating income
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provides investors a valuable measure of the performance of the companys ongoing business, because it excludes both the effect of realized gains
(losses) on investments that tend to be highly variable from period to period, and those events that are unusual and/or unlikely to recur. |
Please see page 19 of the financial supplement, which is available on our website at www.assurant.com, for a summary of net operating income disclosed items.
9
Assurant, Inc. and Subsidiaries
Consolidated Statement of Operations (unaudited)
Three and Nine Months Ended September 30, 2008 and 2007
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Three Months Ended September 30, |
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Nine Months Ended September 30, |
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2008 |
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2007 |
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2008 |
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2007 |
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(in thousands except number of shares and per share amounts) |
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Revenues |
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Net earned premiums and other considerations |
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$ |
1,984,136 |
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$ |
1,893,388 |
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$ |
5,921,069 |
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$ |
5,451,584 |
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Net investment income |
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192,314 |
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194,049 |
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591,299 |
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601,247 |
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Net realized (losses) on investments |
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(299,205 |
) |
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(13,076 |
) |
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(376,922 |
) |
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(10,592 |
) |
Amortization of deferred gains on disposal of businesses |
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7,379 |
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8,298 |
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22,085 |
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24,893 |
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Fees and other income |
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|
69,911 |
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65,533 |
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223,089 |
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203,050 |
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Total revenues |
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1,954,535 |
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2,148,192 |
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|
|
6,380,620 |
|
|
|
6,270,182 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Benefits, losses and expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Policyholder benefits |
|
|
1,095,048 |
|
|
|
935,545 |
|
|
|
3,030,715 |
|
|
|
2,727,120 |
|
Selling, underwriting, general and administrative expenses |
|
|
1,007,817 |
|
|
|
913,214 |
|
|
|
2,932,318 |
|
|
|
2,683,044 |
|
Interest expense |
|
|
15,190 |
|
|
|
15,288 |
|
|
|
45,765 |
|
|
|
45,881 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total benefits, losses and expenses |
|
|
2,118,055 |
|
|
|
1,864,047 |
|
|
|
6,008,798 |
|
|
|
5,456,045 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) income before (benefit) provision for income taxes |
|
|
(163,520 |
) |
|
|
284,145 |
|
|
|
371,822 |
|
|
|
814,137 |
|
(Benefit) provision for income taxes |
|
|
(52,091 |
) |
|
|
96,954 |
|
|
|
106,467 |
|
|
|
281,209 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
(111,429 |
) |
|
$ |
187,191 |
|
|
$ |
265,355 |
|
|
$ |
532,928 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
(0.95 |
) |
|
$ |
1.58 |
|
|
$ |
2.25 |
|
|
$ |
4.43 |
|
Diluted* |
|
$ |
(0.95 |
) |
|
$ |
1.56 |
|
|
$ |
2.23 |
|
|
$ |
4.37 |
|
Dividends per share |
|
$ |
0.14 |
|
|
$ |
0.12 |
|
|
$ |
0.40 |
|
|
$ |
0.34 |
|
Share Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted average shares outstanding |
|
|
117,750,167 |
|
|
|
118,447,175 |
|
|
|
117,897,422 |
|
|
|
120,404,471 |
|
Diluted weighted average shares outstanding |
|
|
117,750,167 |
|
|
|
119,741,434 |
|
|
|
119,144,476 |
|
|
|
122,062,011 |
|
* |
In compliance with GAAP, there is no dilution of shares when calculating earnings per share due to a net loss position for the three months ended September 30, 2008.
|
10
Assurant, Inc. and Subsidiaries
Consolidated Condensed Balance Sheets
At September 30, 2008 (unaudited) and December 31, 2007
|
|
|
|
|
|
|
|
|
|
September 30, 2008 |
|
|
December 31, 2007 |
|
|
(in thousands) |
Assets |
|
|
|
|
|
|
|
Investments and cash and cash equivalents |
|
$ |
13,662,396 |
|
|
$ |
14,552,115 |
Reinsurance recoverables |
|
|
4,015,817 |
|
|
|
3,904,348 |
Deferred acquisition costs |
|
|
2,783,598 |
|
|
|
2,895,345 |
Goodwill |
|
|
840,490 |
|
|
|
832,656 |
Assets held in separate accounts |
|
|
2,252,388 |
|
|
|
3,143,288 |
Other assets |
|
|
1,799,626 |
|
|
|
1,422,564 |
|
|
|
|
|
|
|
|
Total assets |
|
|
25,354,315 |
|
|
|
26,750,316 |
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
Policyholder benefits and claims payable |
|
|
10,656,885 |
|
|
|
10,492,580 |
Unearned premiums |
|
|
5,579,160 |
|
|
|
5,410,709 |
Debt |
|
|
971,933 |
|
|
|
971,863 |
Mandatorily redeemable preferred stock |
|
|
11,160 |
|
|
|
21,160 |
Liabilities related to separate accounts |
|
|
2,252,388 |
|
|
|
3,143,288 |
Accounts payable and other liabilities |
|
|
2,150,978 |
|
|
|
2,621,813 |
|
|
|
|
|
|
|
|
Total liabilities |
|
|
21,622,504 |
|
|
|
22,661,413 |
|
|
|
Stockholders equity |
|
|
|
|
|
|
|
Equity, excluding accumulated other comprehensive (loss) income |
|
|
4,207,609 |
|
|
|
4,034,992 |
Accumulated other comprehensive (loss) income |
|
|
(475,798 |
) |
|
|
53,911 |
|
|
|
|
|
|
|
|
Total stockholders equity |
|
|
3,731,811 |
|
|
|
4,088,903 |
|
|
|
|
|
|
|
|
Total liabilities and stockholders equity |
|
$ |
25,354,315 |
|
|
$ |
26,750,316 |
|
|
|
|
|
|
|
|
11
EX-99.2
3
dex992.htm
FINANCIAL SUPPLEMENT AS OF SEPTEMBER 30, 2008
Financial Supplement as of September 30, 2008
Exhibit 99.2
Assurant, Inc. (AIZ)
Financial Supplement as of September 30, 2008
ASSURANT, INC. AND SUBSIDIARIES
FINANCIAL SUPPLEMENT
(UNAUDITED)
AS OF SEPTEMBER 30, 2008
INDEX TO SUPPLEMENT
|
|
|
|
|
Page: |
SAFE HARBOR STATEMENT & REGULATION G NON GAAP FINANCIAL MEASURES |
|
1 |
|
|
SUMMARY FINANCIAL HIGHLIGHTS |
|
2 |
|
|
SEGMENTED CONDENSED BALANCE SHEETS |
|
4 |
|
|
RECONCILIATION OF NET OPERATING INCOME TO NET INCOME |
|
5 |
|
|
CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS |
|
6 |
|
|
CONDENSED SEGMENT STATEMENTS OF OPERATIONS |
|
7 |
|
|
INVESTMENTS |
|
16 |
|
|
INVESTMENT RESULTS BY ASSET CATEGORY & ANNUALIZED YIELDS |
|
18 |
|
|
SUMMARY OF NET OPERATING INCOME DISCLOSED ITEMS |
|
19 |
|
|
EXHIBIT I TOP 30 ISSUER EXPOSURES |
|
20 |
|
|
EXHIBIT II COMMERCIAL MORTGAGE LOANS SUMMARY |
|
21 |
About Assurant:
Assurant is a premier provider of specialized insurance products and related services in North America and selected other international markets. The four key businesses Assurant Solutions; Assurant Specialty Property; Assurant
Health; and Assurant Employee Benefits have partnered with clients who are leaders in their industries and have built leadership positions in a number of specialty insurance market segments in the U.S. and selected international markets. The
Assurant business units provide debt protection administration; credit-related insurance; warranties and service contracts; pre-funded funeral insurance; creditor-placed homeowners insurance; manufactured housing homeowners insurance; individual
health and small employer group health insurance; group dental insurance; group disability insurance; and group life insurance.
Assurant, a Fortune 500
company and a member of the S & P 500, is traded on the New York Stock Exchange under the symbol AIZ. Assurant has more than $25 billion in assets and $8 billion in annual revenue. Assurant has approximately 14,000 employees worldwide and is
headquartered in New York's financial district. www.assurant.com.
Safe Harbor Statement:
Some of the statements included in this press release and its exhibits, particularly those anticipating future financial performance, business prospects, growth and operating strategies and similar matters, are forward-looking statements
that involve a number of risks and uncertainties. You can identify these statements by the fact that they may use words such as will, anticipate, expect, estimate, project,
intend, plan, believe, target, forecast, or the negative versions of those words and terms with a similar meaning. Our actual results might differ materially from those projected in the
forward-looking statements. The Company undertakes no obligation to update any forward-looking statements in this earnings release or the exhibits as a result of new information or future events or developments.
The following risk factors could cause our actual results to differ materially from those currently estimated by management: (i) failure to maintain significant
client relationships, distribution sources and contractual arrangements; (ii) failure to attract and retain sales representatives; (iii) general global economic, financial market and political conditions (including difficult conditions in
financial, capital and credit markets and the global economic slowdown including fluctuations in interest rates, mortgage rates, monetary policies and inflationary pressure); (iv) inadequacy of reserves established for future claims losses;
(v) failure to predict or manage benefits, claims and other costs; (vi) diminished value of invested assets in our investment portfolio (due to, among other things, the recent volatility in financial markets and the global economic
slowdown, credit and liquidity risk, environmental liability exposure and inability to target an appropriate overall risk level); (vii) losses due to natural and man-made catastrophes; (viii) unavailability, inadequacy and unaffordable
pricing of reinsurance coverage; (ix) inability of reinsurers to meet their obligations; (x) insolvency of third parties to whom we have sold or may sell businesses through reinsurance or modified co-insurance; (xi) credit risk of
some of our agents in Assurant Specialty Property and Solutions;
(xii) a further decline in the manufactured housing industry; (xiii) a decline in
our credit or financial strength ratings (including the currently heightened risk of ratings downgrades in the insurance industry); (xiv) failure to effectively maintain and modernize our information systems; (xv) failure to protect client
information and privacy; (xvi) failure to find and integrate suitable acquisitions and new insurance ventures; (xvii) inability of our subsidiaries to pay sufficient dividends; (xviii) failure to provide for succession of senior
management and key executives; (xix) negative publicity and impact on our business due to unfavorable outcomes in litigation and regulatory investigations (including the potential impact on our reputation and business of a negative outcome in
the ongoing SEC investigation); (xx) significant competitive pressures in our businesses and cyclicality of the insurance industry: (xxi) current or new laws and regulations that could increase our costs or limit our growth.
For a detailed discussion of the risk factors that could affect our actual results, please refer to the risk factors identified in our SEC reports, including, but not
limited to, our upcoming Third Quarter 2008 10-Q filing, and 2007 Annual Report on 10-K, as filed with the SEC.
Regulation G Non GAAP Financial
Measures
Assurant uses the following non-GAAP financial measures to analyze the Companys operating performance for the periods presented in this
financial supplement. Because Assurants calculation of these measures may differ from similar measures used by other companies, investors should be careful when comparing Assurants non-GAAP financial measures to those of other companies.
(1) Assurant uses net operating income as an important measure of the Companys operating performance. Net operating income equals net income,
excluding net realized gains (losses) on investments and unusual and/or infrequent items. The Company believes net operating income provides investors a valuable measure of the performance of the Companys ongoing business, because it excludes
both the effect of net realized gains (losses) on investments that tend to be highly variable from period to period, and those events that are unusual and/or unlikely to recur.
(2) Assurant uses annualized operating ROE as an important measure of the companys operating performance. Annualized operating ROE equals year-to-date net operating income divided by average stockholders
equity for the year to date period, excluding AOCI, and then the return is annualized. The company believes annualized operating ROE provides investors a valuable measure of the performance of the companys ongoing business, because it excludes
the effect of realized gains (losses) on investments that tend to be highly variable and those events that are unusual and/or unlikely to recur. The comparable GAAP measure for this included measure would be annualized GAAP return on equity, defined
as the annualized return of net income divided by average stockholders equity for the period. Consolidated GAAP ROE for the three months and nine months ended September 30, 2008 was 11.2% and 9.0%, respectively. Please refer to
page 6 of the financial supplement for the reconciliation of annualized operating ROE to annualized GAAP ROE.
1
Assurant, Inc. and Subsidiaries
Summary Financial Highlights
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended September 30, |
|
|
For the Nine Months Ended September 30, |
|
($ in thousands, except number of shares and per share amounts) |
|
2008 |
|
|
2007 |
|
|
2008 |
|
|
2007 |
|
Net operating income (1) |
|
$ |
83,054 |
|
|
$ |
195,690 |
|
|
$ |
483,724 |
|
|
$ |
539,812 |
|
Net realized (losses) on investments |
|
|
(194,483 |
) |
|
|
(8,499 |
) |
|
|
(244,999 |
) |
|
|
(6,884 |
) |
Gain on sale of inactive subsidiary |
|
|
|
|
|
|
|
|
|
|
26,630 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
(111,429 |
) |
|
$ |
187,191 |
|
|
$ |
265,355 |
|
|
$ |
532,928 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues |
|
$ |
1,954,535 |
|
|
$ |
2,148,192 |
|
|
$ |
6,380,620 |
|
|
$ |
6,270,182 |
|
|
|
|
|
|
PER SHARE AND SHARE DATA: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per common share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income |
|
$ |
0.71 |
|
|
$ |
1.65 |
|
|
$ |
4.10 |
|
|
$ |
4.48 |
|
Net (loss) income |
|
$ |
(0.95 |
) |
|
$ |
1.58 |
|
|
$ |
2.25 |
|
|
$ |
4.43 |
|
Weighted average common shares outstanding - basic |
|
|
117,750,167 |
|
|
|
118,447,175 |
|
|
|
117,897,422 |
|
|
|
120,404,471 |
|
|
|
|
|
|
Diluted earnings per common share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income |
|
$ |
0.70 |
|
|
$ |
1.63 |
|
|
$ |
4.06 |
|
|
$ |
4.42 |
|
Net (loss) income (2) |
|
$ |
(0.95 |
) |
|
$ |
1.56 |
|
|
$ |
2.23 |
|
|
$ |
4.37 |
|
Weighted average common shares outstanding - diluted |
|
|
118,722,371 |
|
|
|
119,741,434 |
|
|
|
119,144,476 |
|
|
|
122,062,011 |
|
(1) |
See Footnote (1) Regulation GNon GAAP Financial Measures on page 1. |
(2) |
In compliance with GAAP, there is no dilution of shares when calculating earnings per share due to a net loss position for the three months ended September 30, 2008.
|
2
Assurant, Inc. and Subsidiaries
Summary Financial Highlights (continued)
(Unaudited)
|
|
|
|
|
|
|
|
|
($ in thousands, except shares and per share amounts) |
|
As of September 30, 2008 |
|
|
As of December 31, 2007 |
|
Total assets |
|
$ |
25,354,315 |
|
|
$ |
26,750,316 |
|
|
|
|
Total stockholders equity |
|
$ |
3,731,811 |
|
|
$ |
4,088,903 |
|
|
|
|
Total stockholders equity (excluding AOCI) |
|
$ |
4,207,609 |
|
|
$ |
4,034,992 |
|
|
|
|
Basic book value per share |
|
$ |
31.80 |
|
|
$ |
34.71 |
|
Basic book value per share (excluding AOCI) |
|
$ |
35.85 |
|
|
$ |
34.25 |
|
Shares outstanding for basic book value per share calculation |
|
|
117,362,285 |
|
|
|
117,808,007 |
|
|
|
|
Diluted book value per share |
|
$ |
31.57 |
|
|
$ |
34.19 |
|
Diluted book value per share (excluding AOCI) |
|
$ |
35.60 |
|
|
$ |
33.73 |
|
Shares outstanding for diluted book value per share calculation |
|
|
118,203,724 |
|
|
|
119,609,423 |
|
|
|
|
Debt to total capital ratio (excluding AOCI) |
|
|
18.9 |
% |
|
|
19.7 |
% |
3
Assurant, Inc. and Subsidiaries
Segmented Condensed Balance Sheets
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At September 30, 2008 |
|
|
|
Solutions |
|
Specialty Property |
|
Health |
|
Employee Benefits |
|
Corporate & Other(1) |
|
|
Consolidated |
|
|
|
($ in thousands) |
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments and cash and cash equivalents |
|
$ |
7,853,790 |
|
$ |
2,513,877 |
|
$ |
943,164 |
|
$ |
2,419,629 |
|
$ |
(68,064 |
) |
|
$ |
13,662,396 |
|
Reinsurance recoverables |
|
|
656,055 |
|
|
366,653 |
|
|
7,201 |
|
|
20,624 |
|
|
2,965,284 |
|
|
|
4,015,817 |
|
Deferred acquisition costs |
|
|
2,540,693 |
|
|
195,625 |
|
|
20,934 |
|
|
26,346 |
|
|
|
|
|
|
2,783,598 |
|
Goodwill |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
840,490 |
|
|
|
840,490 |
|
Assets held in separate accounts |
|
|
224,292 |
|
|
|
|
|
|
|
|
|
|
|
2,028,096 |
|
|
|
2,252,388 |
|
Other assets |
|
|
473,302 |
|
|
344,821 |
|
|
114,689 |
|
|
82,287 |
|
|
784,527 |
|
|
|
1,799,626 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
11,748,132 |
|
$ |
3,420,976 |
|
$ |
1,085,988 |
|
$ |
2,548,886 |
|
$ |
6,550,333 |
|
|
$ |
25,354,315 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Policyholder benefits and claims payable |
|
$ |
4,683,498 |
|
$ |
512,137 |
|
$ |
477,159 |
|
$ |
1,783,263 |
|
$ |
3,200,828 |
|
|
$ |
10,656,885 |
|
Unearned premiums |
|
|
4,184,624 |
|
|
1,210,398 |
|
|
127,535 |
|
|
14,171 |
|
|
42,432 |
|
|
|
5,579,160 |
|
Debt |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
971,933 |
|
|
|
971,933 |
|
Mandatorily redeemable preferred stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11,160 |
|
|
|
11,160 |
|
Liabilities related to separate accounts |
|
|
224,292 |
|
|
|
|
|
|
|
|
|
|
|
2,028,096 |
|
|
|
2,252,388 |
|
Accounts payable and other liabilities |
|
|
884,269 |
|
|
408,791 |
|
|
152,519 |
|
|
255,814 |
|
|
449,585 |
|
|
|
2,150,978 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities |
|
|
9,976,683 |
|
|
2,131,326 |
|
|
757,213 |
|
|
2,053,248 |
|
|
6,704,034 |
|
|
|
21,622,504 |
|
Stockholders equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity, excluding accumulated other comprehensive loss |
|
|
1,771,449 |
|
|
1,289,650 |
|
|
328,775 |
|
|
495,638 |
|
|
322,097 |
|
|
|
4,207,609 |
|
Accumulated other comprehensive loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(475,798 |
) |
|
|
(475,798 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders equity |
|
|
1,771,449 |
|
|
1,289,650 |
|
|
328,775 |
|
|
495,638 |
|
|
(153,701 |
) |
|
|
3,731,811 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders equity |
|
$ |
11,748,132 |
|
$ |
3,420,976 |
|
$ |
1,085,988 |
|
$ |
2,548,886 |
|
$ |
6,550,333 |
|
|
$ |
25,354,315 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2007 |
|
|
|
Solutions |
|
Specialty Property |
|
Health |
|
Employee Benefits |
|
Corporate & Other(1) |
|
|
Consolidated |
|
|
|
($ in thousands) |
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments and cash and cash equivalents |
|
$ |
7,691,655 |
|
$ |
2,237,372 |
|
$ |
1,113,771 |
|
$ |
2,564,741 |
|
$ |
944,576 |
|
|
$ |
14,552,115 |
|
Reinsurance recoverables |
|
|
687,441 |
|
|
277,395 |
|
|
5,036 |
|
|
17,584 |
|
|
2,916,892 |
|
|
|
3,904,348 |
|
Deferred acquisition costs |
|
|
2,658,207 |
|
|
178,398 |
|
|
34,175 |
|
|
24,565 |
|
|
|
|
|
|
2,895,345 |
|
Goodwill |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
832,656 |
|
|
|
832,656 |
|
Assets held in separate accounts |
|
|
255,341 |
|
|
|
|
|
|
|
|
|
|
|
2,887,947 |
|
|
|
3,143,288 |
|
Other assets |
|
|
644,132 |
|
|
263,249 |
|
|
83,609 |
|
|
200,808 |
|
|
230,766 |
|
|
|
1,422,564 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
11,936,776 |
|
$ |
2,956,414 |
|
$ |
1,236,591 |
|
$ |
2,807,698 |
|
$ |
7,812,837 |
|
|
$ |
26,750,316 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Policyholder benefits and claims payable |
|
$ |
4,676,416 |
|
$ |
314,062 |
|
$ |
500,126 |
|
$ |
1,842,861 |
|
$ |
3,159,115 |
|
|
$ |
10,492,580 |
|
Unearned premiums |
|
|
4,171,003 |
|
|
1,052,326 |
|
|
128,756 |
|
|
14,259 |
|
|
44,365 |
|
|
|
5,410,709 |
|
Debt |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
971,863 |
|
|
|
971,863 |
|
Mandatorily redeemable preferred stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
21,160 |
|
|
|
21,160 |
|
Liabilities related to separate accounts |
|
|
255,341 |
|
|
|
|
|
|
|
|
|
|
|
2,887,947 |
|
|
|
3,143,288 |
|
Accounts payable and other liabilities |
|
|
1,238,933 |
|
|
431,952 |
|
|
196,812 |
|
|
345,220 |
|
|
408,896 |
|
|
|
2,621,813 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities |
|
|
10,341,693 |
|
|
1,798,340 |
|
|
825,694 |
|
|
2,202,340 |
|
|
7,493,346 |
|
|
|
22,661,413 |
|
Stockholders equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity, excluding accumulated other comprehensive income |
|
|
1,595,083 |
|
|
1,158,074 |
|
|
410,897 |
|
|
605,358 |
|
|
265,580 |
|
|
|
4,034,992 |
|
Accumulated other comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
53,911 |
|
|
|
53,911 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders equity |
|
|
1,595,083 |
|
|
1,158,074 |
|
|
410,897 |
|
|
605,358 |
|
|
319,491 |
|
|
|
4,088,903 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders equity |
|
$ |
11,936,776 |
|
$ |
2,956,414 |
|
$ |
1,236,591 |
|
$ |
2,807,698 |
|
$ |
7,812,837 |
|
|
$ |
26,750,316 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
The Corporate and Other segment includes Accumulated Other Comprehensive Income (Loss), Reinsurance Recoverables related to the disposal of FFG and LTC businesses, goodwill,
separate accounts related to the disposal of FFG business and all of Assurant, Inc.s debt. |
4
Assurant, Inc. and Subsidiaries
Reconciliation of Net Operating Income to Net Income
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
|
For the Nine Months Ended |
|
($ in thousands, net of tax) |
|
September 30, 2008 |
|
|
June 30, 2008 |
|
|
March 31, 2008 |
|
|
December 31, 2007 |
|
|
September 30, 2007 |
|
|
June 30, 2007 |
|
|
March 31, 2007 |
|
|
September 30, 2008 |
|
|
September 30, 2007 |
|
Assurant Solutions |
|
$ |
20,387 |
|
|
$ |
32,355 |
|
|
$ |
47,557 |
|
|
$ |
32,265 |
|
|
$ |
37,377 |
|
|
$ |
30,210 |
|
|
$ |
44,069 |
|
|
$ |
100,299 |
|
|
$ |
111,656 |
|
Assurant Specialty Property |
|
|
30,942 |
|
|
|
131,042 |
|
|
|
124,744 |
|
|
|
99,917 |
|
|
|
114,682 |
|
|
|
90,207 |
|
|
|
74,434 |
|
|
|
286,728 |
|
|
|
279,323 |
|
Assurant Health |
|
|
30,204 |
|
|
|
27,721 |
|
|
|
37,263 |
|
|
|
38,016 |
|
|
|
39,365 |
|
|
|
33,838 |
|
|
|
40,524 |
|
|
|
95,188 |
|
|
|
113,727 |
|
Assurant Employee Benefits |
|
|
21,457 |
|
|
|
18,630 |
|
|
|
16,332 |
|
|
|
16,197 |
|
|
|
20,392 |
|
|
|
21,475 |
|
|
|
28,957 |
|
|
|
56,419 |
|
|
|
70,824 |
|
Corporate and other |
|
|
(14,858 |
) |
|
|
(18,777 |
) |
|
|
(5,882 |
) |
|
|
(27,436 |
) |
|
|
(11,583 |
) |
|
|
(2,862 |
) |
|
|
(7,632 |
) |
|
|
(39,517 |
) |
|
|
(22,077 |
) |
Amortization of deferred gains on disposal of businesses |
|
|
4,796 |
|
|
|
4,763 |
|
|
|
4,796 |
|
|
|
5,360 |
|
|
|
5,394 |
|
|
|
5,360 |
|
|
|
5,427 |
|
|
|
14,355 |
|
|
|
16,181 |
|
Interest expense |
|
|
(9,874 |
) |
|
|
(9,937 |
) |
|
|
(9,937 |
) |
|
|
(9,943 |
) |
|
|
(9,937 |
) |
|
|
(9,942 |
) |
|
|
(9,943 |
) |
|
|
(29,748 |
) |
|
|
(29,822 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income |
|
|
83,054 |
|
|
|
185,797 |
|
|
|
214,873 |
|
|
|
154,376 |
|
|
|
195,690 |
|
|
|
168,286 |
|
|
|
175,836 |
|
|
|
483,724 |
|
|
|
539,812 |
|
|
|
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net realized (losses) gains on investments |
|
|
(194,483 |
) |
|
|
(22,473 |
) |
|
|
(28,043 |
) |
|
|
(33,558 |
) |
|
|
(8,499 |
) |
|
|
(2,006 |
) |
|
|
3,621 |
|
|
|
(244,999 |
) |
|
|
(6,884 |
) |
Gain on sale of inactive subsidiary |
|
|
|
|
|
|
26,630 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
26,630 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
(111,429 |
) |
|
$ |
189,954 |
|
|
$ |
186,830 |
|
|
$ |
120,818 |
|
|
$ |
187,191 |
|
|
$ |
166,280 |
|
|
$ |
179,457 |
|
|
$ |
265,355 |
|
|
$ |
532,928 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5
Assurant, Inc. and Subsidiaries
Consolidated Condensed Statements of Operations
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
|
For the Nine Months Ended |
|
($ in thousands, except per share data and closing stock price)
|
|
September 30, 2008 |
|
|
June 30, 2008 |
|
|
March 31, 2008 |
|
|
December 31, 2007 |
|
|
September 30, 2007 |
|
|
June 30, 2007 |
|
|
March 31, 2007 |
|
|
September 30, 2008 |
|
|
September 30, 2007 |
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earned premiums and other considerations |
|
$ |
1,984,136 |
|
|
$ |
1,995,516 |
|
|
$ |
1,941,417 |
|
|
$ |
1,956,146 |
|
|
$ |
1,893,388 |
|
|
$ |
1,798,687 |
|
|
$ |
1,759,509 |
|
|
$ |
5,921,069 |
|
|
$ |
5,451,584 |
|
Net investment income |
|
|
192,314 |
|
|
|
201,211 |
|
|
|
197,774 |
|
|
|
197,826 |
|
|
|
194,049 |
|
|
|
190,302 |
|
|
|
216,896 |
|
|
|
591,299 |
|
|
|
601,247 |
|
Net realized (losses) gains on investments |
|
|
(299,205 |
) |
|
|
(34,574 |
) |
|
|
(43,143 |
) |
|
|
(51,628 |
) |
|
|
(13,076 |
) |
|
|
(3,086 |
) |
|
|
5,570 |
|
|
|
(376,922 |
) |
|
|
(10,592 |
) |
Amortization of deferred gains on disposal of businesses |
|
|
7,379 |
|
|
|
7,327 |
|
|
|
7,379 |
|
|
|
8,246 |
|
|
|
8,298 |
|
|
|
8,246 |
|
|
|
8,349 |
|
|
|
22,085 |
|
|
|
24,893 |
|
Fees and other income |
|
|
69,911 |
|
|
|
79,280 |
|
|
|
73,898 |
|
|
|
72,743 |
|
|
|
65,533 |
|
|
|
70,578 |
|
|
|
66,939 |
|
|
|
223,089 |
|
|
|
203,050 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,954,535 |
|
|
|
2,248,760 |
|
|
|
2,177,325 |
|
|
|
2,183,333 |
|
|
|
2,148,192 |
|
|
|
2,064,727 |
|
|
|
2,057,263 |
|
|
|
6,380,620 |
|
|
|
6,270,182 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Benefits, losses and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Policyholder benefits |
|
|
1,095,048 |
|
|
|
998,208 |
|
|
|
937,459 |
|
|
|
985,591 |
|
|
|
935,545 |
|
|
|
902,053 |
|
|
|
889,522 |
|
|
|
3,030,715 |
|
|
|
2,727,120 |
|
Selling, underwriting, general and administrative expenses |
|
|
1,007,817 |
|
|
|
985,851 |
|
|
|
938,650 |
|
|
|
985,542 |
|
|
|
913,214 |
|
|
|
894,904 |
|
|
|
874,926 |
|
|
|
2,932,318 |
|
|
|
2,683,044 |
|
Interest expense |
|
|
15,190 |
|
|
|
15,287 |
|
|
|
15,288 |
|
|
|
15,297 |
|
|
|
15,288 |
|
|
|
15,296 |
|
|
|
15,297 |
|
|
|
45,765 |
|
|
|
45,881 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,118,055 |
|
|
|
1,999,346 |
|
|
|
1,891,397 |
|
|
|
1,986,430 |
|
|
|
1,864,047 |
|
|
|
1,812,253 |
|
|
|
1,779,745 |
|
|
|
6,008,798 |
|
|
|
5,456,045 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) income before provision for income taxes |
|
|
(163,520 |
) |
|
|
249,414 |
|
|
|
285,928 |
|
|
|
196,903 |
|
|
|
284,145 |
|
|
|
252,474 |
|
|
|
277,518 |
|
|
|
371,822 |
|
|
|
814,137 |
|
(Benefit) provision for income taxes |
|
|
(52,091 |
) |
|
|
59,460 |
|
|
|
99,098 |
|
|
|
76,085 |
|
|
|
96,954 |
|
|
|
86,194 |
|
|
|
98,061 |
|
|
|
106,467 |
|
|
|
281,209 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
(111,429 |
) |
|
$ |
189,954 |
|
|
$ |
186,830 |
|
|
$ |
120,818 |
|
|
$ |
187,191 |
|
|
$ |
166,280 |
|
|
$ |
179,457 |
|
|
$ |
265,355 |
|
|
$ |
532,928 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted per share data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income per diluted share |
|
$ |
0.70 |
|
|
$ |
1.55 |
|
|
$ |
1.80 |
|
|
$ |
1.29 |
|
|
$ |
1.63 |
|
|
$ |
1.37 |
|
|
$ |
1.42 |
|
|
$ |
4.06 |
|
|
$ |
4.42 |
|
Book value per diluted share (excluding AOCI) |
|
$ |
35.60 |
|
|
$ |
36.68 |
|
|
$ |
35.33 |
|
|
$ |
33.73 |
|
|
$ |
32.99 |
|
|
$ |
31.81 |
|
|
$ |
31.14 |
|
|
$ |
35.60 |
|
|
$ |
32.99 |
|
|
|
|
|
|
|
|
|
|
|
Annualized operating return on average equity (excluding AOCI) (1) |
|
|
7.7 |
% |
|
|
17.3 |
% |
|
|
20.8 |
% |
|
|
15.5 |
% |
|
|
20.1 |
% |
|
|
17.5 |
% |
|
|
18.6 |
% |
|
|
15.6 |
% |
|
|
18.8 |
% |
Net realized (losses) gains on investments |
|
|
-18.1 |
% |
|
|
-2.1 |
% |
|
|
-2.7 |
% |
|
|
-3.4 |
% |
|
|
-0.9 |
% |
|
|
-0.2 |
% |
|
|
0.4 |
% |
|
|
-7.9 |
% |
|
|
-0.2 |
% |
Gain on sale of inactive subsidiary |
|
|
|
|
|
|
2.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.9 |
% |
|
|
|
|
Change due to effect of including AOCI |
|
|
-0.8 |
% |
|
|
0.3 |
% |
|
|
-0.1 |
% |
|
|
|
|
|
|
0.2 |
% |
|
|
-0.1 |
% |
|
|
-0.4 |
% |
|
|
0.4 |
% |
|
|
-0.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annualized GAAP return on average equity (1) |
|
|
-11.2 |
% |
|
|
18.0 |
% |
|
|
18.0 |
% |
|
|
12.1 |
% |
|
|
19.4 |
% |
|
|
17.2 |
% |
|
|
18.5 |
% |
|
|
9.0 |
% |
|
|
18.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share repurchases: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares repurchased |
|
|
1,000,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,283,100 |
|
|
|
1,984,400 |
|
|
|
1,421,833 |
|
|
|
1,000,000 |
|
|
|
5,689,333 |
|
Average repurchase price per share |
|
$ |
59.00 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
52.07 |
|
|
$ |
58.56 |
|
|
$ |
54.48 |
|
|
$ |
59.00 |
|
|
$ |
54.94 |
|
Repurchase price |
|
$ |
59,000 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
118,887 |
|
|
$ |
116,216 |
|
|
$ |
77,460 |
|
|
$ |
59,000 |
|
|
$ |
312,563 |
|
AIZ Closing stock price (NYSE) |
|
$ |
55.00 |
|
|
$ |
65.96 |
|
|
$ |
60.86 |
|
|
$ |
66.90 |
|
|
$ |
53.50 |
|
|
$ |
58.92 |
|
|
$ |
53.63 |
|
|
$ |
55.00 |
|
|
$ |
53.50 |
|
Investment yield (1) |
|
|
5.44 |
% |
|
|
5.56 |
% |
|
|
5.61 |
% |
|
|
5.70 |
% |
|
|
5.73 |
% |
|
|
5.69 |
% |
|
|
5.66 |
% |
|
|
5.59 |
% |
|
|
5.68 |
% |
Investment income from real estate joint venture partnerships |
|
$ |
|
|
|
$ |
3,457 |
|
|
$ |
|
|
|
$ |
127 |
|
|
$ |
534 |
|
|
$ |
2,972 |
|
|
$ |
33,540 |
|
|
$ |
3,457 |
|
|
$ |
37,046 |
|
(1) |
See Footnote (2) Regulation G - Non GAAP Financial Measures on page 1. |
(2) |
Investment yield excludes investment income from real estate joint venture partnerships shown above. |
6
Assurant Solutions
Condensed Statements of Operations
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
For the Nine Months Ended |
($ in thousands) |
|
September 30, 2008 |
|
|
June 30, 2008 |
|
March 31, 2008 |
|
December 31, 2007 |
|
September 30, 2007 |
|
June 30, 2007 |
|
March 31, 2007 |
|
September 30, 2008 |
|
September 30, 2007 |
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earned premiums and other considerations |
|
$ |
707,115 |
|
|
$ |
700,629 |
|
$ |
683,493 |
|
$ |
678,844 |
|
$ |
649,915 |
|
$ |
618,675 |
|
$ |
583,011 |
|
$ |
2,091,237 |
|
$ |
1,851,601 |
Net investment income |
|
|
105,539 |
|
|
|
108,425 |
|
|
106,730 |
|
|
108,899 |
|
|
105,631 |
|
|
100,784 |
|
|
112,017 |
|
|
320,694 |
|
|
318,432 |
Fees and other income |
|
|
40,623 |
|
|
|
47,668 |
|
|
44,281 |
|
|
43,580 |
|
|
36,623 |
|
|
40,957 |
|
|
38,051 |
|
|
132,572 |
|
|
115,631 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
853,277 |
|
|
|
856,722 |
|
|
834,504 |
|
|
831,323 |
|
|
792,169 |
|
|
760,416 |
|
|
733,079 |
|
|
2,544,503 |
|
|
2,285,664 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Benefits, losses and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Policyholder benefits |
|
|
295,190 |
|
|
|
306,173 |
|
|
286,680 |
|
|
287,232 |
|
|
284,755 |
|
|
258,527 |
|
|
243,344 |
|
|
888,043 |
|
|
786,626 |
Selling, underwriting, general and administrative expenses |
|
|
527,779 |
|
|
|
503,073 |
|
|
475,533 |
|
|
496,414 |
|
|
451,510 |
|
|
455,140 |
|
|
427,645 |
|
|
1,506,385 |
|
|
1,334,295 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
822,969 |
|
|
|
809,246 |
|
|
762,213 |
|
|
783,646 |
|
|
736,265 |
|
|
713,667 |
|
|
670,989 |
|
|
2,394,428 |
|
|
2,120,921 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before provision for income taxes |
|
|
30,308 |
|
|
|
47,476 |
|
|
72,291 |
|
|
47,677 |
|
|
55,904 |
|
|
46,749 |
|
|
62,090 |
|
|
150,075 |
|
|
164,743 |
Provision for income taxes |
|
|
9,921 |
|
|
|
15,121 |
|
|
24,734 |
|
|
15,412 |
|
|
18,527 |
|
|
16,539 |
|
|
18,021 |
|
|
49,776 |
|
|
53,087 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income |
|
$ |
20,387 |
|
|
$ |
32,355 |
|
$ |
47,557 |
|
$ |
32,265 |
|
$ |
37,377 |
|
$ |
30,210 |
|
$ |
44,069 |
|
$ |
100,299 |
|
$ |
111,656 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earned premiums and other considerations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit |
|
$ |
70,270 |
|
|
$ |
69,808 |
|
$ |
73,253 |
|
$ |
70,563 |
|
$ |
75,638 |
|
$ |
76,109 |
|
$ |
80,921 |
|
$ |
213,331 |
|
$ |
232,668 |
Service contracts |
|
|
334,386 |
|
|
|
335,552 |
|
|
319,515 |
|
|
322,092 |
|
|
292,762 |
|
|
280,274 |
|
|
261,863 |
|
|
989,453 |
|
|
834,899 |
Other |
|
|
13,685 |
|
|
|
15,186 |
|
|
15,434 |
|
|
16,007 |
|
|
14,496 |
|
|
15,517 |
|
|
16,689 |
|
|
44,305 |
|
|
46,702 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Domestic |
|
|
418,341 |
|
|
|
420,546 |
|
|
408,202 |
|
|
408,662 |
|
|
382,896 |
|
|
371,900 |
|
|
359,473 |
|
|
1,247,089 |
|
|
1,114,269 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit |
|
|
98,645 |
|
|
|
88,661 |
|
|
98,264 |
|
|
88,988 |
|
|
98,431 |
|
|
92,413 |
|
|
96,877 |
|
|
285,570 |
|
|
287,721 |
Service contracts |
|
|
93,745 |
|
|
|
90,128 |
|
|
77,667 |
|
|
79,982 |
|
|
64,561 |
|
|
62,543 |
|
|
42,717 |
|
|
261,540 |
|
|
169,821 |
Other |
|
|
(139 |
) |
|
|
6,903 |
|
|
9,598 |
|
|
11,598 |
|
|
8,307 |
|
|
10,260 |
|
|
8,979 |
|
|
16,362 |
|
|
27,546 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total International |
|
|
192,251 |
|
|
|
185,692 |
|
|
185,529 |
|
|
180,568 |
|
|
171,299 |
|
|
165,216 |
|
|
148,573 |
|
|
563,472 |
|
|
485,088 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preneed: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic and international |
|
|
88,293 |
|
|
|
85,253 |
|
|
80,654 |
|
|
79,446 |
|
|
85,050 |
|
|
70,358 |
|
|
63,288 |
|
|
254,200 |
|
|
218,696 |
Domestic independent runoff |
|
|
8,230 |
|
|
|
9,138 |
|
|
9,108 |
|
|
10,168 |
|
|
10,670 |
|
|
11,201 |
|
|
11,677 |
|
|
26,476 |
|
|
33,548 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Preneed |
|
|
96,523 |
|
|
|
94,391 |
|
|
89,762 |
|
|
89,614 |
|
|
95,720 |
|
|
81,559 |
|
|
74,965 |
|
|
280,676 |
|
|
252,244 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
707,115 |
|
|
$ |
700,629 |
|
$ |
683,493 |
|
$ |
678,844 |
|
$ |
649,915 |
|
$ |
618,675 |
|
$ |
583,011 |
|
$ |
2,091,237 |
|
$ |
1,851,601 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fee income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt protection |
|
$ |
8,495 |
|
|
$ |
8,284 |
|
$ |
7,915 |
|
$ |
7,459 |
|
$ |
7,415 |
|
$ |
7,469 |
|
$ |
8,750 |
|
$ |
24,694 |
|
$ |
23,634 |
Service contracts |
|
|
18,472 |
|
|
|
19,941 |
|
|
18,370 |
|
|
19,963 |
|
|
16,679 |
|
|
17,190 |
|
|
16,877 |
|
|
56,783 |
|
|
50,746 |
Other |
|
|
6,873 |
|
|
|
7,439 |
|
|
5,735 |
|
|
7,021 |
|
|
6,320 |
|
|
5,205 |
|
|
6,493 |
|
|
20,047 |
|
|
18,018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Domestic |
|
|
33,840 |
|
|
|
35,664 |
|
|
32,020 |
|
|
34,443 |
|
|
30,414 |
|
|
29,864 |
|
|
32,120 |
|
|
101,524 |
|
|
92,398 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International |
|
|
7,272 |
|
|
|
9,706 |
|
|
9,740 |
|
|
8,113 |
|
|
5,179 |
|
|
4,384 |
|
|
4,492 |
|
|
26,718 |
|
|
14,055 |
Preneed |
|
|
(489 |
) |
|
|
2,298 |
|
|
2,521 |
|
|
1,024 |
|
|
1,030 |
|
|
6,709 |
|
|
1,439 |
|
|
4,330 |
|
|
9,178 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
40,623 |
|
|
$ |
47,668 |
|
$ |
44,281 |
|
$ |
43,580 |
|
$ |
36,623 |
|
$ |
40,957 |
|
$ |
38,051 |
|
$ |
132,572 |
|
$ |
115,631 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7
Assurant Solutions (continued)
Condensed Statements of Operations
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
|
For the Nine Months Ended |
|
($ in thousands) |
|
September 30, 2008 |
|
|
June 30, 2008 |
|
|
March 31, 2008 |
|
|
December 31, 2007 |
|
|
September 30, 2007 |
|
|
June 30, 2007 |
|
|
March 31, 2007 |
|
|
September 30, 2008 |
|
|
September 30, 2007 |
|
Gross written premiums: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit |
|
$ |
151,717 |
|
|
$ |
152,730 |
|
|
$ |
152,341 |
|
|
$ |
159,259 |
|
|
$ |
168,135 |
|
|
$ |
167,738 |
|
|
$ |
161,843 |
|
|
$ |
456,788 |
|
|
$ |
497,716 |
|
Service contracts |
|
|
385,153 |
|
|
|
396,157 |
|
|
|
393,811 |
|
|
|
491,036 |
|
|
|
434,465 |
|
|
|
448,143 |
|
|
|
454,404 |
|
|
|
1,175,121 |
|
|
|
1,337,012 |
|
Other |
|
|
17,858 |
|
|
|
17,076 |
|
|
|
16,758 |
|
|
|
19,773 |
|
|
|
22,353 |
|
|
|
22,014 |
|
|
|
20,865 |
|
|
|
51,692 |
|
|
|
65,232 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Domestic |
|
|
554,728 |
|
|
|
565,963 |
|
|
|
562,910 |
|
|
|
670,068 |
|
|
|
624,953 |
|
|
|
637,895 |
|
|
|
637,112 |
|
|
|
1,683,601 |
|
|
|
1,899,960 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit |
|
|
213,322 |
|
|
|
214,407 |
|
|
|
219,212 |
|
|
|
221,181 |
|
|
|
219,945 |
|
|
|
201,353 |
|
|
|
191,415 |
|
|
|
646,941 |
|
|
|
612,713 |
|
Service contracts |
|
|
133,226 |
|
|
|
110,714 |
|
|
|
101,002 |
|
|
|
137,385 |
|
|
|
118,754 |
|
|
|
86,948 |
|
|
|
79,582 |
|
|
|
344,942 |
|
|
|
285,284 |
|
Other |
|
|
1,375 |
|
|
|
8,962 |
|
|
|
11,348 |
|
|
|
11,059 |
|
|
|
11,176 |
|
|
|
13,933 |
|
|
|
10,422 |
|
|
|
21,685 |
|
|
|
35,531 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total International |
|
|
347,923 |
|
|
|
334,083 |
|
|
|
331,562 |
|
|
|
369,625 |
|
|
|
349,875 |
|
|
|
302,234 |
|
|
|
281,419 |
|
|
|
1,013,568 |
|
|
|
933,528 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
902,651 |
|
|
$ |
900,046 |
|
|
$ |
894,472 |
|
|
$ |
1,039,693 |
|
|
$ |
974,828 |
|
|
$ |
940,129 |
|
|
$ |
918,531 |
|
|
$ |
2,697,169 |
|
|
$ |
2,833,488 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preneed (face sales) |
|
$ |
121,021 |
|
|
$ |
120,859 |
|
|
$ |
104,424 |
|
|
$ |
100,031 |
|
|
$ |
107,341 |
|
|
$ |
102,360 |
|
|
$ |
86,058 |
|
|
$ |
346,304 |
|
|
$ |
295,759 |
|
Foreign currency translation (FX) impact (1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross written premiums: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Including FX impact |
|
|
-7.40 |
% |
|
|
-4.26 |
% |
|
|
-2.62 |
% |
|
|
5.84 |
% |
|
|
9.99 |
% |
|
|
13.57 |
% |
|
|
15.67 |
% |
|
|
-4.81 |
% |
|
|
12.97 |
% |
FX impact |
|
|
0.96 |
% |
|
|
2.34 |
% |
|
|
3.43 |
% |
|
|
3.09 |
% |
|
|
1.21 |
% |
|
|
0.85 |
% |
|
|
0.48 |
% |
|
|
2.22 |
% |
|
|
0.86 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Excluding FX impact |
|
|
-8.36 |
% |
|
|
-6.60 |
% |
|
|
-6.05 |
% |
|
|
2.75 |
% |
|
|
8.78 |
% |
|
|
12.72 |
% |
|
|
15.19 |
% |
|
|
-7.03 |
% |
|
|
12.11 |
% |
Net earned premiums: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Including FX impact |
|
|
8.80 |
% |
|
|
13.25 |
% |
|
|
17.23 |
% |
|
|
9.88 |
% |
|
|
9.92 |
% |
|
|
4.47 |
% |
|
|
2.21 |
% |
|
|
12.94 |
% |
|
|
5.58 |
% |
FX impact |
|
|
0.56 |
% |
|
|
1.65 |
% |
|
|
2.42 |
% |
|
|
2.40 |
% |
|
|
1.15 |
% |
|
|
0.87 |
% |
|
|
0.67 |
% |
|
|
1.51 |
% |
|
|
0.90 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Excluding FX impact |
|
|
8.24 |
% |
|
|
11.60 |
% |
|
|
14.81 |
% |
|
|
7.48 |
% |
|
|
8.77 |
% |
|
|
3.60 |
% |
|
|
1.54 |
% |
|
|
11.43 |
% |
|
|
4.68 |
% |
Net operating income (2): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Including FX impact |
|
|
-45.45 |
% |
|
|
7.10 |
% |
|
|
7.91 |
% |
|
|
-18.95 |
% |
|
|
-10.38 |
% |
|
|
-18.68 |
% |
|
|
10.87 |
% |
|
|
-10.17 |
% |
|
|
-5.86 |
% |
FX impact |
|
|
-1.42 |
% |
|
|
-4.64 |
% |
|
|
1.99 |
% |
|
|
-0.88 |
% |
|
|
-1.49 |
% |
|
|
-2.01 |
% |
|
|
-1.33 |
% |
|
|
-1.34 |
% |
|
|
-1.60 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Excluding FX impact |
|
|
-44.03 |
% |
|
|
11.74 |
% |
|
|
5.92 |
% |
|
|
-18.07 |
% |
|
|
-8.89 |
% |
|
|
-16.67 |
% |
|
|
12.20 |
% |
|
|
-8.83 |
% |
|
|
-4.26 |
% |
Combined ratios (a): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic |
|
|
104.7 |
% |
|
|
99.4 |
% |
|
|
96.5 |
% |
|
|
101.9 |
% |
|
|
100.9 |
% |
|
|
100.8 |
% |
|
|
100.9 |
% |
|
|
100.2 |
% |
|
|
100.9 |
% |
International |
|
|
105.6 |
% |
|
|
111.4 |
% |
|
|
102.3 |
% |
|
|
106.1 |
% |
|
|
102.3 |
% |
|
|
109.7 |
% |
|
|
102.1 |
% |
|
|
106.4 |
% |
|
|
104.7 |
% |
Preneed yield (3) |
|
|
6.04 |
% |
|
|
6.28 |
% |
|
|
6.13 |
% |
|
|
6.30 |
% |
|
|
6.50 |
% |
|
|
6.27 |
% |
|
|
6.29 |
% |
|
|
6.11 |
% |
|
|
6.29 |
% |
Preneed average invested assets |
|
$ |
3,919,388 |
|
|
$ |
3,937,722 |
|
|
$ |
3,963,127 |
|
|
$ |
3,986,933 |
|
|
$ |
3,832,047 |
|
|
$ |
3,650,784 |
|
|
$ |
3,600,420 |
|
|
$ |
3,940,415 |
|
|
$ |
3,717,137 |
|
Investment yield (3) |
|
|
5.60 |
% |
|
|
5.76 |
% |
|
|
5.72 |
% |
|
|
5.83 |
% |
|
|
5.84 |
% |
|
|
5.83 |
% |
|
|
5.80 |
% |
|
|
5.68 |
% |
|
|
5.77 |
% |
Investment income from real estate joint venture partnerships |
|
$ |
|
|
|
$ |
1,210 |
|
|
$ |
|
|
|
$ |
44 |
|
|
$ |
187 |
|
|
$ |
1,045 |
|
|
$ |
14,448 |
|
|
$ |
1,210 |
|
|
$ |
15,680 |
|
(a) |
The combined ratio is equal to total benefits, losses and expenses divided by net earned premiums and other considerations and fees and other income excluding the preneed business.
|
(1) |
Total Solutions percentage growth from year-ago period due to conversion of income statement transactions at weighted average foreign currency exchange rates.
|
(2) |
Net operating income growth for the three months ended December 31, 2007 compared to the year-ago period excludes $40,481 of after-tax income related to a third-party legal
settlement previously disclosed in the Financial Supplement as of December 31, 2007. |
(3) |
Investment yield excludes investment income from real estate joint venture partnerships shown above. |
8
Assurant Specialty Property
Condensed Statements of Operations
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
|
For the Nine Months Ended |
|
($ in thousands) |
|
September 30, 2008 |
|
|
June 30, 2008 |
|
|
March 31, 2008 |
|
|
December 31, 2007 |
|
|
September 30, 2007 |
|
|
June 30, 2007 |
|
|
March 31, 2007 |
|
|
September 30, 2008 |
|
|
September 30, 2007 |
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earned premiums and other considerations |
|
$ |
513,228 |
|
|
$ |
533,914 |
|
|
$ |
481,427 |
|
|
$ |
476,400 |
|
|
$ |
445,211 |
|
|
$ |
393,614 |
|
|
$ |
367,041 |
|
|
$ |
1,528,569 |
|
|
$ |
1,205,866 |
|
Net investment income |
|
|
31,129 |
|
|
|
31,997 |
|
|
|
29,375 |
|
|
|
28,812 |
|
|
|
25,862 |
|
|
|
23,667 |
|
|
|
21,869 |
|
|
|
92,501 |
|
|
|
71,398 |
|
Fees and other income |
|
|
12,501 |
|
|
|
11,996 |
|
|
|
13,593 |
|
|
|
13,943 |
|
|
|
12,063 |
|
|
|
12,654 |
|
|
|
12,596 |
|
|
|
38,090 |
|
|
|
37,313 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
556,858 |
|
|
|
577,907 |
|
|
|
524,395 |
|
|
|
519,155 |
|
|
|
483,136 |
|
|
|
429,935 |
|
|
|
401,506 |
|
|
|
1,659,160 |
|
|
|
1,314,577 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Benefits, losses and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Policyholder benefits |
|
|
302,105 |
|
|
|
171,793 |
|
|
|
144,813 |
|
|
|
171,866 |
|
|
|
129,354 |
|
|
|
130,866 |
|
|
|
116,787 |
|
|
|
618,711 |
|
|
|
377,007 |
|
Selling, underwriting, general and administrative expenses |
|
|
208,519 |
|
|
|
206,339 |
|
|
|
188,842 |
|
|
|
194,129 |
|
|
|
177,738 |
|
|
|
159,292 |
|
|
|
170,799 |
|
|
|
603,700 |
|
|
|
507,829 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
510,624 |
|
|
|
378,132 |
|
|
|
333,655 |
|
|
|
365,995 |
|
|
|
307,092 |
|
|
|
290,158 |
|
|
|
287,586 |
|
|
|
1,222,411 |
|
|
|
884,836 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before provision for income taxes |
|
|
46,234 |
|
|
|
199,775 |
|
|
|
190,740 |
|
|
|
153,160 |
|
|
|
176,044 |
|
|
|
139,777 |
|
|
|
113,920 |
|
|
|
436,749 |
|
|
|
429,741 |
|
Provision for income taxes |
|
|
15,292 |
|
|
|
68,733 |
|
|
|
65,996 |
|
|
|
53,243 |
|
|
|
61,362 |
|
|
|
49,570 |
|
|
|
39,486 |
|
|
|
150,021 |
|
|
|
150,418 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income |
|
$ |
30,942 |
|
|
$ |
131,042 |
|
|
$ |
124,744 |
|
|
$ |
99,917 |
|
|
$ |
114,682 |
|
|
$ |
90,207 |
|
|
$ |
74,434 |
|
|
$ |
286,728 |
|
|
$ |
279,323 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earned premiums for selected product groupings: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Homeowners (Creditor Placed & Voluntary) |
|
$ |
368,066 |
|
|
$ |
391,153 |
|
|
$ |
342,335 |
|
|
$ |
342,931 |
|
|
$ |
317,607 |
|
|
$ |
276,663 |
|
|
$ |
250,889 |
|
|
$ |
1,101,554 |
|
|
$ |
845,159 |
|
Manufactured Housing (Creditor Placed & Voluntary) |
|
|
55,389 |
|
|
|
56,484 |
|
|
|
57,061 |
|
|
|
53,850 |
|
|
|
54,132 |
|
|
|
50,452 |
|
|
|
50,670 |
|
|
|
168,934 |
|
|
|
155,254 |
|
Other |
|
|
89,773 |
|
|
|
86,277 |
|
|
|
82,031 |
|
|
|
79,619 |
|
|
|
73,472 |
|
|
|
66,499 |
|
|
|
65,482 |
|
|
|
258,081 |
|
|
|
205,453 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
513,228 |
|
|
$ |
533,914 |
|
|
$ |
481,427 |
|
|
$ |
476,400 |
|
|
$ |
445,211 |
|
|
$ |
393,614 |
|
|
$ |
367,041 |
|
|
$ |
1,528,569 |
|
|
$ |
1,205,866 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross written premiums for selected product groupings: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Homeowners (Creditor Placed & Voluntary) |
|
$ |
492,069 |
|
|
$ |
529,444 |
|
|
$ |
419,501 |
|
|
$ |
462,730 |
|
|
$ |
420,184 |
|
|
$ |
380,099 |
|
|
$ |
319,053 |
|
|
$ |
1,441,014 |
|
|
$ |
1,119,336 |
|
Manufactured Housing (Creditor Placed & Voluntary) |
|
|
80,909 |
|
|
|
79,451 |
|
|
|
70,131 |
|
|
|
79,193 |
|
|
|
77,885 |
|
|
|
77,042 |
|
|
|
67,785 |
|
|
|
230,491 |
|
|
|
222,712 |
|
Other |
|
|
187,929 |
|
|
|
169,849 |
|
|
|
125,316 |
|
|
|
146,182 |
|
|
|
156,235 |
|
|
|
150,435 |
|
|
|
112,322 |
|
|
|
483,094 |
|
|
|
418,992 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
760,907 |
|
|
$ |
778,744 |
|
|
$ |
614,948 |
|
|
$ |
688,105 |
|
|
$ |
654,304 |
|
|
$ |
607,576 |
|
|
$ |
499,160 |
|
|
$ |
2,154,599 |
|
|
$ |
1,761,040 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratios: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss ratio (a) |
|
|
58.9 |
% |
|
|
32.2 |
% |
|
|
30.1 |
% |
|
|
36.1 |
% |
|
|
29.1 |
% |
|
|
33.2 |
% |
|
|
31.8 |
% |
|
|
40.5 |
% |
|
|
31.3 |
% |
Expense ratio (b) |
|
|
39.7 |
% |
|
|
37.8 |
% |
|
|
38.1 |
% |
|
|
39.6 |
% |
|
|
38.9 |
% |
|
|
39.2 |
% |
|
|
45.0 |
% |
|
|
38.5 |
% |
|
|
40.8 |
% |
Combined ratio (c) |
|
|
97.1 |
% |
|
|
69.3 |
% |
|
|
67.4 |
% |
|
|
74.6 |
% |
|
|
67.2 |
% |
|
|
71.4 |
% |
|
|
75.8 |
% |
|
|
78.0 |
% |
|
|
71.2 |
% |
Investment yield (1) |
|
|
5.11 |
% |
|
|
5.16 |
% |
|
|
5.11 |
% |
|
|
5.58 |
% |
|
|
5.46 |
% |
|
|
5.28 |
% |
|
|
5.51 |
% |
|
|
5.19 |
% |
|
|
5.53 |
% |
Investment income from real estatejoint venture partnerships |
|
$ |
|
|
|
$ |
346 |
|
|
$ |
|
|
|
$ |
13 |
|
|
$ |
53 |
|
|
$ |
297 |
|
|
$ |
159 |
|
|
$ |
346 |
|
|
$ |
509 |
|
(a) |
The loss ratio is equal to policyholder benefits divided by net earned premiums and other considerations. |
(b) |
The expense ratio is equal to selling, underwriting, general and administrative expenses divided by net earned premiums and other considerations and fees and other income.
|
(c) |
The combined ratio is equal to total benefits, losses and expenses divided by net earned premiums and other considerations and fees and other income. |
(1) |
Investment yield excludes investment income from real estate joint venture partnerships shown above. |
9
Assurant Specialty Property (continued)
Condensed Statements of Operations
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
|
For the Nine Months Ended |
|
($ in thousands) |
|
September 30, 2008 |
|
|
June 30, 2008 |
|
|
March 31, 2008 |
|
|
December 31, 2007 |
|
|
September 30, 2007 |
|
|
June 30, 2007 |
|
|
March 31, 2007 |
|
|
September 30, 2008 |
|
|
September 30, 2007 |
|
Creditor-Placed Homeowners Insurance: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans tracked (in millions): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prime |
|
|
26.2 |
|
|
|
26.3 |
|
|
|
26.2 |
|
|
|
26.2 |
|
|
|
26.1 |
|
|
|
24.5 |
|
|
|
24.3 |
|
|
|
26.2 |
|
|
|
26.1 |
|
Sub-prime |
|
|
4.1 |
|
|
|
4.2 |
|
|
|
4.4 |
|
|
|
4.6 |
|
|
|
5.0 |
|
|
|
5.3 |
|
|
|
5.4 |
|
|
|
4.1 |
|
|
|
5.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30.3 |
|
|
|
30.5 |
|
|
|
30.6 |
|
|
|
30.8 |
|
|
|
31.1 |
|
|
|
29.8 |
|
|
|
29.7 |
|
|
|
30.3 |
|
|
|
31.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Penetration rate ranges: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prime range |
|
|
1% - 2 |
% |
|
|
1% -2 |
% |
|
|
1% - 2 |
% |
|
|
1% - 2 |
% |
|
|
1% - 2 |
% |
|
|
1% - 2 |
% |
|
|
1% - 2 |
% |
|
|
1% - 2 |
% |
|
|
1% - 2 |
% |
Sub-prime range |
|
|
6% - 15 |
% |
|
|
6% - 15 |
% |
|
|
6% - 15 |
% |
|
|
6% - 15 |
% |
|
|
5% - 11 |
% |
|
|
3% - 8 |
% |
|
|
3% - 8 |
% |
|
|
6% - 15 |
% |
|
|
5% - 11 |
% |
Average insured value: |
|
$ |
173 |
|
|
$ |
170 |
|
|
$ |
165 |
|
|
$ |
159 |
|
|
$ |
151 |
|
|
$ |
146 |
|
|
$ |
141 |
|
|
$ |
173 |
|
|
$ |
151 |
|
10
Assurant Health
Condensed Statements of Operations
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
For the Nine Months Ended |
($ in thousands) |
|
September 30, 2008 |
|
June 30, 2008 |
|
March 31, 2008 |
|
December 31, 2007 |
|
September 30, 2007 |
|
June 30, 2007 |
|
March 31, 2007 |
|
September 30, 2008 |
|
September 30, 2007 |
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earned premiums and other considerations |
|
$ |
486,700 |
|
$ |
487,725 |
|
$ |
496,060 |
|
$ |
509,327 |
|
$ |
514,233 |
|
$ |
513,936 |
|
$ |
512,784 |
|
$ |
1,470,485 |
|
$ |
1,540,953 |
Net investment income |
|
|
13,769 |
|
|
15,302 |
|
|
15,648 |
|
|
15,321 |
|
|
15,753 |
|
|
16,290 |
|
|
19,270 |
|
|
44,719 |
|
|
51,313 |
Fees and other income |
|
|
10,100 |
|
|
9,637 |
|
|
9,406 |
|
|
9,762 |
|
|
10,688 |
|
|
10,445 |
|
|
9,688 |
|
|
29,143 |
|
|
30,821 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
510,569 |
|
|
512,664 |
|
|
521,114 |
|
|
534,410 |
|
|
540,674 |
|
|
540,671 |
|
|
541,742 |
|
|
1,544,347 |
|
|
1,623,087 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Benefits, losses and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Policyholder benefits |
|
|
311,790 |
|
|
325,504 |
|
|
306,565 |
|
|
321,851 |
|
|
326,479 |
|
|
329,327 |
|
|
317,784 |
|
|
943,859 |
|
|
973,590 |
Selling, underwriting, general and administrative expenses |
|
|
152,345 |
|
|
143,804 |
|
|
157,181 |
|
|
152,922 |
|
|
153,928 |
|
|
159,088 |
|
|
161,410 |
|
|
453,330 |
|
|
474,426 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
464,135 |
|
|
469,308 |
|
|
463,746 |
|
|
474,773 |
|
|
480,407 |
|
|
488,415 |
|
|
479,194 |
|
|
1,397,189 |
|
|
1,448,016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before provision for income taxes |
|
|
46,434 |
|
|
43,356 |
|
|
57,368 |
|
|
59,637 |
|
|
60,267 |
|
|
52,256 |
|
|
62,548 |
|
|
147,158 |
|
|
175,071 |
Provision for income taxes |
|
|
16,230 |
|
|
15,635 |
|
|
20,105 |
|
|
21,621 |
|
|
20,902 |
|
|
18,418 |
|
|
22,024 |
|
|
51,970 |
|
|
61,344 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income |
|
$ |
30,204 |
|
$ |
27,721 |
|
$ |
37,263 |
|
$ |
38,016 |
|
$ |
39,365 |
|
$ |
33,838 |
|
$ |
40,524 |
|
$ |
95,188 |
|
$ |
113,727 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earned premiums and other considerations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Individual: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Individual medical |
|
$ |
319,188 |
|
$ |
318,095 |
|
$ |
319,756 |
|
$ |
324,727 |
|
$ |
323,490 |
|
$ |
320,442 |
|
$ |
314,662 |
|
$ |
957,039 |
|
$ |
958,594 |
Short-term medical |
|
|
27,335 |
|
|
24,583 |
|
|
23,539 |
|
|
24,441 |
|
|
26,336 |
|
|
23,499 |
|
|
22,561 |
|
|
75,457 |
|
|
72,396 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal |
|
|
346,523 |
|
|
342,678 |
|
|
343,295 |
|
|
349,168 |
|
|
349,826 |
|
|
343,941 |
|
|
337,223 |
|
|
1,032,496 |
|
|
1,030,990 |
Small employer group |
|
|
140,177 |
|
|
145,047 |
|
|
152,765 |
|
|
160,159 |
|
|
164,407 |
|
|
169,995 |
|
|
175,561 |
|
|
437,989 |
|
|
509,963 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
486,700 |
|
$ |
487,725 |
|
$ |
496,060 |
|
$ |
509,327 |
|
$ |
514,233 |
|
$ |
513,936 |
|
$ |
512,784 |
|
$ |
1,470,485 |
|
$ |
1,540,953 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11
Assurant Health (continued)
Condensed Statements of Operations
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
|
For the Nine Months Ended |
|
($ in thousands) |
|
September 30, 2008 |
|
|
June 30, 2008 |
|
|
March 31, 2008 |
|
|
December 31, 2007 |
|
|
September 30, 2007 |
|
|
June 30, 2007 |
|
|
March 31, 2007 |
|
|
September 30, 2008 |
|
|
September 30, 2007 |
|
Sales (annualized issued premiums): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Individual: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Individual medical |
|
$ |
87,600 |
|
|
$ |
78,080 |
|
|
$ |
79,976 |
|
|
$ |
67,680 |
|
|
$ |
85,089 |
|
|
$ |
100,468 |
|
|
$ |
99,614 |
|
|
$ |
245,656 |
|
|
$ |
285,171 |
|
Short-term medical |
|
|
35,969 |
|
|
|
34,990 |
|
|
|
32,972 |
|
|
|
30,219 |
|
|
|
35,285 |
|
|
|
33,606 |
|
|
|
31,939 |
|
|
|
103,931 |
|
|
|
100,830 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal |
|
|
123,569 |
|
|
|
113,070 |
|
|
|
112,948 |
|
|
|
97,899 |
|
|
|
120,374 |
|
|
|
134,074 |
|
|
|
131,553 |
|
|
|
349,587 |
|
|
|
386,001 |
|
Small employer group |
|
|
27,189 |
|
|
|
25,864 |
|
|
|
26,161 |
|
|
|
27,345 |
|
|
|
27,414 |
|
|
|
28,307 |
|
|
|
29,520 |
|
|
|
79,214 |
|
|
|
85,241 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
150,758 |
|
|
$ |
138,934 |
|
|
$ |
139,109 |
|
|
$ |
125,244 |
|
|
$ |
147,788 |
|
|
$ |
162,381 |
|
|
$ |
161,073 |
|
|
$ |
428,801 |
|
|
$ |
471,242 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Membership by product line (in thousands): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Individual: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Individual medical |
|
|
585 |
|
|
|
587 |
|
|
|
599 |
|
|
|
619 |
|
|
|
638 |
|
|
|
650 |
|
|
|
641 |
|
|
|
585 |
|
|
|
638 |
|
Short-term medical |
|
|
101 |
|
|
|
101 |
|
|
|
87 |
|
|
|
87 |
|
|
|
101 |
|
|
|
99 |
|
|
|
85 |
|
|
|
101 |
|
|
|
101 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal |
|
|
686 |
|
|
|
688 |
|
|
|
686 |
|
|
|
706 |
|
|
|
739 |
|
|
|
749 |
|
|
|
726 |
|
|
|
686 |
|
|
|
739 |
|
Small employer group |
|
|
136 |
|
|
|
142 |
|
|
|
152 |
|
|
|
165 |
|
|
|
171 |
|
|
|
181 |
|
|
|
191 |
|
|
|
136 |
|
|
|
171 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
822 |
|
|
|
830 |
|
|
|
838 |
|
|
|
871 |
|
|
|
910 |
|
|
|
930 |
|
|
|
917 |
|
|
|
822 |
|
|
|
910 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratios: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss ratio (a) |
|
|
64.1 |
% |
|
|
66.7 |
% |
|
|
61.8 |
% |
|
|
63.2 |
% |
|
|
63.5 |
% |
|
|
64.1 |
% |
|
|
62.0 |
% |
|
|
64.2 |
% |
|
|
63.2 |
% |
Expense ratio (b) |
|
|
30.7 |
% |
|
|
28.9 |
% |
|
|
31.1 |
% |
|
|
29.5 |
% |
|
|
29.3 |
% |
|
|
30.3 |
% |
|
|
30.9 |
% |
|
|
30.2 |
% |
|
|
30.2 |
% |
Combined ratio (c) |
|
|
93.4 |
% |
|
|
94.4 |
% |
|
|
91.7 |
% |
|
|
91.5 |
% |
|
|
91.5 |
% |
|
|
93.1 |
% |
|
|
91.7 |
% |
|
|
93.2 |
% |
|
|
92.1 |
% |
Investment yield (1) |
|
|
5.67 |
% |
|
|
5.84 |
% |
|
|
6.12 |
% |
|
|
5.79 |
% |
|
|
5.93 |
% |
|
|
5.84 |
% |
|
|
5.70 |
% |
|
|
5.89 |
% |
|
|
5.81 |
% |
Investment income from real estate joint venture partnerships |
|
$ |
|
|
|
$ |
691 |
|
|
$ |
|
|
|
$ |
25 |
|
|
$ |
107 |
|
|
$ |
590 |
|
|
$ |
3,535 |
|
|
$ |
691 |
|
|
$ |
4,232 |
|
(a) |
The loss ratio is equal to policyholder benefits divided by net earned premiums and other considerations. |
(b) |
The expense ratio is equal to selling, underwriting, general and administrative expenses divided by net earned premiums and other considerations and fees and other income.
|
(c) |
The combined ratio is equal to total benefits, losses and expenses divided by net earned premiums and other considerations and fees and other income. |
(1) |
Investment yield excludes investment income from real estate joint venture partnerships shown above. |
12
Assurant Employee Benefits
Condensed Statements of Operations
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
For the Nine Months Ended |
($ in thousands) |
|
September 30, 2008 |
|
June 30, 2008 |
|
March 31, 2008 |
|
December 31, 2007 |
|
September 30, 2007 |
|
June 30, 2007 |
|
March 31, 2007 |
|
September 30, 2008 |
|
September 30, 2007 |
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earned premiums and other considerations |
|
$ |
277,093 |
|
$ |
273,248 |
|
$ |
280,437 |
|
$ |
291,575 |
|
$ |
284,029 |
|
$ |
272,462 |
|
$ |
296,673 |
|
$ |
830,778 |
|
$ |
853,164 |
Net investment income |
|
|
35,278 |
|
|
38,919 |
|
|
38,369 |
|
|
37,614 |
|
|
38,046 |
|
|
39,408 |
|
|
51,887 |
|
|
112,566 |
|
|
129,341 |
Fees and other income |
|
|
6,475 |
|
|
7,208 |
|
|
6,555 |
|
|
5,301 |
|
|
6,040 |
|
|
6,379 |
|
|
6,277 |
|
|
20,238 |
|
|
18,696 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
318,846 |
|
|
319,375 |
|
|
325,361 |
|
|
334,490 |
|
|
328,115 |
|
|
318,249 |
|
|
354,837 |
|
|
963,582 |
|
|
1,001,201 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Benefits, losses and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Policyholder benefits |
|
|
185,951 |
|
|
193,642 |
|
|
199,401 |
|
|
200,673 |
|
|
194,957 |
|
|
183,333 |
|
|
211,607 |
|
|
578,994 |
|
|
589,897 |
Selling, underwriting, general and administrative expenses |
|
|
99,726 |
|
|
97,354 |
|
|
100,901 |
|
|
108,847 |
|
|
101,978 |
|
|
102,090 |
|
|
98,953 |
|
|
297,981 |
|
|
303,021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
285,677 |
|
|
290,996 |
|
|
300,302 |
|
|
309,520 |
|
|
296,935 |
|
|
285,423 |
|
|
310,560 |
|
|
876,975 |
|
|
892,918 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before provision for income taxes |
|
|
33,169 |
|
|
28,379 |
|
|
25,059 |
|
|
24,970 |
|
|
31,180 |
|
|
32,826 |
|
|
44,277 |
|
|
86,607 |
|
|
108,283 |
Provision for income taxes |
|
|
11,712 |
|
|
9,749 |
|
|
8,727 |
|
|
8,773 |
|
|
10,788 |
|
|
11,351 |
|
|
15,320 |
|
|
30,188 |
|
|
37,459 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating income |
|
$ |
21,457 |
|
$ |
18,630 |
|
$ |
16,332 |
|
$ |
16,197 |
|
$ |
20,392 |
|
$ |
21,475 |
|
$ |
28,957 |
|
$ |
56,419 |
|
$ |
70,824 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earned premiums and other considerations by: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Major product grouping: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Group dental |
|
$ |
109,982 |
|
$ |
108,976 |
|
$ |
106,073 |
|
$ |
104,938 |
|
$ |
103,770 |
|
$ |
102,567 |
|
$ |
101,535 |
|
$ |
325,031 |
|
$ |
307,872 |
Group disability single premiums for closed blocks |
|
|
|
|
|
|
|
|
5,500 |
|
|
14,326 |
|
|
12,283 |
|
|
|
|
|
22,847 |
|
|
5,500 |
|
|
35,130 |
All other group disability |
|
|
115,749 |
|
|
113,327 |
|
|
116,300 |
|
|
118,858 |
|
|
114,904 |
|
|
115,539 |
|
|
118,189 |
|
|
345,376 |
|
|
348,632 |
Group life |
|
|
51,362 |
|
|
50,945 |
|
|
52,564 |
|
|
53,453 |
|
|
53,072 |
|
|
54,356 |
|
|
54,102 |
|
|
154,871 |
|
|
161,530 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
277,093 |
|
$ |
273,248 |
|
$ |
280,437 |
|
$ |
291,575 |
|
$ |
284,029 |
|
$ |
272,462 |
|
$ |
296,673 |
|
$ |
830,778 |
|
$ |
853,164 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13
Assurant Employee Benefits (continued)
Condensed Statements of Operations
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
|
For the Nine Months Ended |
|
($ in thousands) |
|
September 30, 2008 |
|
|
June 30, 2008 |
|
|
March 31, 2008 |
|
|
December 31, 2007 |
|
|
September 30, 2007 |
|
|
June 30, 2007 |
|
|
March 31, 2007 |
|
|
September 30, 2008 |
|
|
September 30, 2007 |
|
Sales: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Group dental |
|
$ |
24,918 |
|
|
$ |
23,021 |
|
|
$ |
45,625 |
|
|
$ |
16,969 |
|
|
$ |
26,780 |
|
|
$ |
19,747 |
|
|
$ |
42,212 |
|
|
$ |
93,564 |
|
|
$ |
88,739 |
|
Group disability |
|
|
13,972 |
|
|
|
10,404 |
|
|
|
18,909 |
|
|
|
10,984 |
|
|
|
12,314 |
|
|
|
14,121 |
|
|
|
20,394 |
|
|
|
43,285 |
|
|
|
46,829 |
|
Group life |
|
|
6,936 |
|
|
|
5,775 |
|
|
|
9,836 |
|
|
|
6,069 |
|
|
|
6,210 |
|
|
|
7,051 |
|
|
|
11,875 |
|
|
|
22,547 |
|
|
|
25,136 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
45,826 |
|
|
$ |
39,200 |
|
|
$ |
74,370 |
|
|
$ |
34,022 |
|
|
$ |
45,304 |
|
|
$ |
40,919 |
|
|
$ |
74,481 |
|
|
$ |
159,396 |
|
|
$ |
160,704 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratios: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss ratio (a) |
|
|
67.1 |
% |
|
|
70.9 |
% |
|
|
71.1 |
% |
|
|
68.8 |
% |
|
|
68.6 |
% |
|
|
67.3 |
% |
|
|
71.3 |
% |
|
|
69.7 |
% |
|
|
69.1 |
% |
Expense ratio (b) |
|
|
35.2 |
% |
|
|
34.7 |
% |
|
|
35.2 |
% |
|
|
36.7 |
% |
|
|
35.2 |
% |
|
|
36.6 |
% |
|
|
32.7 |
% |
|
|
35.0 |
% |
|
|
34.8 |
% |
Investment yield (1) |
|
|
5.98 |
% |
|
|
6.25 |
% |
|
|
6.29 |
% |
|
|
6.16 |
% |
|
|
6.19 |
% |
|
|
6.21 |
% |
|
|
6.09 |
% |
|
|
6.19 |
% |
|
|
6.17 |
% |
Investment income from real estate joint venture partnerships |
|
$ |
|
|
|
$ |
1,210 |
|
|
$ |
|
|
|
$ |
45 |
|
|
$ |
187 |
|
|
$ |
1,040 |
|
|
$ |
14,164 |
|
|
$ |
1,210 |
|
|
$ |
15,391 |
|
(a) |
The loss ratio is equal to policyholder benefits divided by net earned premiums and other considerations. |
(b) |
The expense ratio is equal to selling, underwriting, general and administrative expenses divided by net earned premiums and other considerations and fees and other income.
|
(1) |
Investment yield excludes investment income from real estate joint venture partnerships shown above. |
14
Assurant Corporate and Other
Condensed Statements of Operations
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
|
For the Nine Months Ended |
|
($ in thousands) |
|
September 30, 2008 |
|
|
June 30, 2008 |
|
|
March 31, 2008 |
|
|
December 31, 2007 |
|
|
September 30, 2007 |
|
|
June 30, 2007 |
|
|
March 31, 2007 |
|
|
September 30, 2008 |
|
|
September 30, 2007 |
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earned premiums and other considerations |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
Net investment income |
|
|
6,599 |
|
|
|
6,568 |
|
|
|
7,652 |
|
|
|
7,180 |
|
|
|
8,757 |
|
|
|
10,153 |
|
|
|
11,853 |
|
|
|
20,819 |
|
|
|
30,763 |
|
Net realized (losses) gains on investments |
|
|
(299,205 |
) |
|
|
(34,574 |
) |
|
|
(43,143 |
) |
|
|
(51,628 |
) |
|
|
(13,076 |
) |
|
|
(3,086 |
) |
|
|
5,570 |
|
|
|
(376,922 |
) |
|
|
(10,592 |
) |
Amortization of deferred gains on disposal of businesses |
|
|
7,379 |
|
|
|
7,327 |
|
|
|
7,379 |
|
|
|
8,246 |
|
|
|
8,298 |
|
|
|
8,246 |
|
|
|
8,349 |
|
|
|
22,085 |
|
|
|
24,893 |
|
Fees and other income |
|
|
212 |
|
|
|
2,771 |
|
|
|
63 |
|
|
|
157 |
|
|
|
119 |
|
|
|
143 |
|
|
|
327 |
|
|
|
3,046 |
|
|
|
589 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(285,015 |
) |
|
|
(17,908 |
) |
|
|
(28,049 |
) |
|
|
(36,045 |
) |
|
|
4,098 |
|
|
|
15,456 |
|
|
|
26,099 |
|
|
|
(330,972 |
) |
|
|
45,653 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Benefits, losses and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Policyholder benefits |
|
|
12 |
|
|
|
1,096 |
|
|
|
|
|
|
|
3,969 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,108 |
|
|
|
|
|
Selling, underwriting, general and administrative expenses |
|
|
19,448 |
|
|
|
35,281 |
|
|
|
16,193 |
|
|
|
33,230 |
|
|
|
28,060 |
|
|
|
19,294 |
|
|
|
16,119 |
|
|
|
70,922 |
|
|
|
63,473 |
|
Interest expense |
|
|
15,190 |
|
|
|
15,287 |
|
|
|
15,288 |
|
|
|
15,297 |
|
|
|
15,288 |
|
|
|
15,296 |
|
|
|
15,297 |
|
|
|
45,765 |
|
|
|
45,881 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
34,650 |
|
|
|
51,664 |
|
|
|
31,481 |
|
|
|
52,496 |
|
|
|
43,348 |
|
|
|
34,590 |
|
|
|
31,416 |
|
|
|
117,795 |
|
|
|
109,354 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before (benefit) provision for income taxes |
|
|
(319,665 |
) |
|
|
(69,572 |
) |
|
|
(59,530 |
) |
|
|
(88,541 |
) |
|
|
(39,250 |
) |
|
|
(19,134 |
) |
|
|
(5,317 |
) |
|
|
(448,767 |
) |
|
|
(63,701 |
) |
(Benefit) provision for income taxes |
|
|
(105,246 |
) |
|
|
(49,778 |
) |
|
|
(20,464 |
) |
|
|
(22,964 |
) |
|
|
(14,625 |
) |
|
|
(9,684 |
) |
|
|
3,210 |
|
|
|
(175,488 |
) |
|
|
(21,099 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating loss |
|
$ |
(214,419 |
) |
|
$ |
(19,794 |
) |
|
$ |
(39,066 |
) |
|
$ |
(65,577 |
) |
|
$ |
(24,625 |
) |
|
$ |
(9,450 |
) |
|
$ |
(8,527 |
) |
|
$ |
(273,279 |
) |
|
$ |
(42,602 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Real estate investment income |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
1,234 |
|
|
$ |
|
|
|
$ |
1,234 |
|
Corporate and Other Reconciliation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assurant Corporate and Other Segment Net Operating Income |
|
$ |
(214,419 |
) |
|
$ |
(19,794 |
) |
|
$ |
(39,066 |
) |
|
$ |
(65,577 |
) |
|
$ |
(24,625 |
) |
|
$ |
(9,450 |
) |
|
$ |
(8,527 |
) |
|
$ |
(273,279 |
) |
|
$ |
(42,602 |
) |
Adjustments, net of tax: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of deferred gains on disposal of businesses |
|
|
(4,796 |
) |
|
|
(4,763 |
) |
|
|
(4,796 |
) |
|
|
(5,360 |
) |
|
|
(5,394 |
) |
|
|
(5,360 |
) |
|
|
(5,427 |
) |
|
|
(14,355 |
) |
|
|
(16,181 |
) |
Interest expense |
|
|
9,874 |
|
|
|
9,937 |
|
|
|
9,937 |
|
|
|
9,943 |
|
|
|
9,937 |
|
|
|
9,942 |
|
|
|
9,943 |
|
|
|
29,748 |
|
|
|
29,822 |
|
Net realized losses (gains) on investments |
|
|
194,483 |
|
|
|
22,473 |
|
|
|
28,043 |
|
|
|
33,558 |
|
|
|
8,499 |
|
|
|
2,006 |
|
|
|
(3,621 |
) |
|
|
244,999 |
|
|
|
6,884 |
|
Gain on sale of inactive subsidiary |
|
|
|
|
|
|
(26,630 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(26,630 |
) |
|
|
|
|
Corporate and other per Reconciliation of Net Operating |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income to Net Income (page 5) |
|
$ |
(14,858 |
) |
|
$ |
(18,777 |
) |
|
$ |
(5,882 |
) |
|
$ |
(27,436 |
) |
|
$ |
(11,583 |
) |
|
$ |
(2,862 |
) |
|
$ |
(7,632 |
) |
|
$ |
(39,517 |
) |
|
$ |
(22,077 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15
Assurant, Inc. and Subsidiaries
Investments
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
($ in thousands) |
|
As of September 30, 2008 |
|
|
|
|
As of December 31, 2007 |
|
|
|
Investments by type |
|
|
|
|
|
|
|
|
|
|
|
|
Fixed maturity securities: available for sale, at fair value |
|
$ |
9,059,614 |
|
66.3 |
% |
|
$ |
10,126,415 |
|
69.6 |
% |
Equity securities: available for sale, at fair value |
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stocks |
|
|
486,358 |
|
3.6 |
% |
|
|
613,525 |
|
4.2 |
% |
Common stocks |
|
|
5,455 |
|
0.1 |
% |
|
|
22,476 |
|
0.2 |
% |
Commercial mortgage loans on real estate, at amortized cost |
|
|
1,502,086 |
|
11.0 |
% |
|
|
1,433,626 |
|
9.9 |
% |
Policy loans |
|
|
57,475 |
|
0.4 |
% |
|
|
57,107 |
|
0.4 |
% |
Short-term investments |
|
|
620,434 |
|
4.5 |
% |
|
|
410,878 |
|
2.8 |
% |
Collateral held under securities lending |
|
|
343,321 |
|
2.5 |
% |
|
|
541,650 |
|
3.7 |
% |
Other investments |
|
|
533,974 |
|
3.9 |
% |
|
|
541,474 |
|
3.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total investments |
|
|
12,608,717 |
|
92.3 |
% |
|
|
13,747,151 |
|
94.5 |
% |
Cash and cash equivalents |
|
|
1,053,679 |
|
7.7 |
% |
|
|
804,964 |
|
5.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total investments and cash and cash equivalents |
|
$ |
13,662,396 |
|
100.0 |
% |
|
$ |
14,552,115 |
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed Maturity Securities by Credit Quality (Fair Value) |
|
|
|
|
|
|
|
|
|
|
|
|
Aaa / Aa / A |
|
$ |
6,008,185 |
|
66.3 |
% |
|
$ |
6,917,249 |
|
68.3 |
% |
Baa |
|
|
2,409,011 |
|
26.6 |
% |
|
|
2,570,640 |
|
25.4 |
% |
Ba |
|
|
519,037 |
|
5.7 |
% |
|
|
492,822 |
|
4.9 |
% |
B and lower |
|
|
123,381 |
|
1.4 |
% |
|
|
145,704 |
|
1.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
9,059,614 |
|
100.0 |
% |
|
$ |
10,126,415 |
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
16
Assurant, Inc. and Subsidiaries
Investments (continued)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of September 30, 2008 |
|
|
As of December 31, 2007 |
|
($ in thousands) |
|
Book Value |
|
Fair Value |
|
% of Fair Value |
|
|
Unrealized Gain (Loss) |
|
|
Book Value |
|
Fair Value |
|
% of Fair Value |
|
|
Unrealized Gain (Loss) |
|
Fixed Maturity Securities by Issuer Type: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Governmental: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Government and government agencies |
|
$ |
147,075 |
|
$ |
152,486 |
|
1.7 |
% |
|
$ |
5,411 |
|
|
$ |
287,064 |
|
$ |
297,278 |
|
2.9 |
% |
|
$ |
10,214 |
|
State, municipalities and political subdivisions |
|
|
960,329 |
|
|
933,045 |
|
10.3 |
% |
|
|
(27,284 |
) |
|
|
630,196 |
|
|
646,549 |
|
6.4 |
% |
|
|
16,353 |
|
Foreign governments |
|
|
552,404 |
|
|
545,210 |
|
6.0 |
% |
|
|
(7,194 |
) |
|
|
680,097 |
|
|
704,246 |
|
7.0 |
% |
|
|
24,149 |
|
Corporate (1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer Cyclical |
|
|
987,003 |
|
|
907,932 |
|
10.0 |
% |
|
|
(79,071 |
) |
|
|
933,420 |
|
|
934,737 |
|
9.2 |
% |
|
|
1,317 |
|
Consumer Non-Cyclical |
|
|
351,325 |
|
|
332,690 |
|
3.7 |
% |
|
|
(18,635 |
) |
|
|
366,562 |
|
|
373,127 |
|
3.7 |
% |
|
|
6,565 |
|
Energy |
|
|
664,614 |
|
|
626,883 |
|
6.9 |
% |
|
|
(37,731 |
) |
|
|
684,996 |
|
|
715,105 |
|
7.1 |
% |
|
|
30,109 |
|
Financials |
|
|
2,019,099 |
|
|
1,769,587 |
|
19.5 |
% |
|
|
(249,512 |
) |
|
|
2,314,297 |
|
|
2,285,585 |
|
22.6 |
% |
|
|
(28,712 |
) |
Health Care |
|
|
317,618 |
|
|
299,825 |
|
3.3 |
% |
|
|
(17,793 |
) |
|
|
381,497 |
|
|
383,799 |
|
3.8 |
% |
|
|
2,302 |
|
Industrials |
|
|
1,046,111 |
|
|
985,339 |
|
10.9 |
% |
|
|
(60,772 |
) |
|
|
1,005,049 |
|
|
1,017,314 |
|
10.0 |
% |
|
|
12,265 |
|
Materials |
|
|
279,152 |
|
|
259,901 |
|
2.9 |
% |
|
|
(19,251 |
) |
|
|
300,705 |
|
|
300,447 |
|
3.0 |
% |
|
|
(258 |
) |
Technology |
|
|
150,164 |
|
|
143,333 |
|
1.6 |
% |
|
|
(6,831 |
) |
|
|
186,930 |
|
|
189,095 |
|
1.9 |
% |
|
|
2,165 |
|
Telecommunications |
|
|
388,652 |
|
|
361,232 |
|
4.0 |
% |
|
|
(27,420 |
) |
|
|
387,946 |
|
|
403,953 |
|
4.0 |
% |
|
|
16,007 |
|
Utilities |
|
|
814,885 |
|
|
762,023 |
|
8.4 |
% |
|
|
(52,862 |
) |
|
|
739,183 |
|
|
745,588 |
|
7.4 |
% |
|
|
6,405 |
|
Other corporate |
|
|
42,645 |
|
|
41,598 |
|
0.5 |
% |
|
|
(1,047 |
) |
|
|
51,866 |
|
|
51,294 |
|
0.5 |
% |
|
|
(572 |
) |
Asset-backed securities |
|
|
23,797 |
|
|
22,383 |
|
0.2 |
% |
|
|
(1,414 |
) |
|
|
54,560 |
|
|
55,349 |
|
0.5 |
% |
|
|
789 |
|
Commercial mortgage-backed securities |
|
|
246,664 |
|
|
228,421 |
|
2.5 |
% |
|
|
(18,243 |
) |
|
|
191,007 |
|
|
190,743 |
|
1.9 |
% |
|
|
(264 |
) |
Residential mortgage-backed securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Agency |
|
|
637,781 |
|
|
643,990 |
|
7.1 |
% |
|
|
6,209 |
|
|
|
688,160 |
|
|
696,539 |
|
6.9 |
% |
|
|
8,379 |
|
Alt-A |
|
|
|
|
|
|
|
0.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
0.0 |
% |
|
|
|
|
Subprime |
|
|
28,531 |
|
|
28,155 |
|
0.3 |
% |
|
|
(376 |
) |
|
|
79,876 |
|
|
77,562 |
|
0.8 |
% |
|
|
(2,314 |
) |
Other |
|
|
359 |
|
|
369 |
|
0.0 |
% |
|
|
10 |
|
|
|
406 |
|
|
421 |
|
0.0 |
% |
|
|
15 |
|
Collaterized debt obligations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit backed |
|
|
16,732 |
|
|
15,212 |
|
0.2 |
% |
|
|
(1,520 |
) |
|
|
62,538 |
|
|
57,684 |
|
0.6 |
% |
|
|
(4,854 |
) |
RMBS backed |
|
|
|
|
|
|
|
0.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
0.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total fixed maturity securities |
|
$ |
9,674,940 |
|
$ |
9,059,614 |
|
100.0 |
% |
|
$ |
(615,326 |
) |
|
$ |
10,026,355 |
|
$ |
10,126,415 |
|
100.0 |
% |
|
$ |
100,060 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Industry classifications are based on a combination of published index classifications as well as Assurant's view of
underlying creditor risk. These resulting classifications are then mapped to the Global Industry Classification Standard (GICS®). |
17
Assurant, Inc. and Subsidiaries
Investment Results by Asset Category and Annualized Yields
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended September 30, 2008 |
|
|
For the Three Months Ended September 30, 2007 |
|
|
For the Nine Months Ended September 30, 2008 |
|
|
For the Nine Months Ended September 30, 2007 |
|
($ in thousands) |
|
Yield |
|
|
Investment Income |
|
|
Net realized gain (loss) |
|
|
Yield |
|
|
Investment Income |
|
|
Net realized gain (loss) |
|
|
Yield |
|
|
Investment Income |
|
|
Net realized gain (loss) |
|
|
Yield |
|
|
Investment Income |
|
|
Net realized gain (loss) |
|
Fixed maturity securities: available for sale, at fair value |
|
5.99 |
% |
|
$ |
146,440 |
|
|
$ |
(128,088 |
) |
|
6.00 |
% |
|
$ |
143,810 |
|
|
$ |
(13,664 |
) |
|
6.01 |
% |
|
$ |
442,148 |
|
|
$ |
(187,663 |
) |
|
5.94 |
% |
|
$ |
415,481 |
|
|
$ |
(15,230 |
) |
Equity securities: available for sale, at fair value |
|
7.13 |
% |
|
|
12,439 |
|
|
|
(160,091 |
) |
|
6.47 |
% |
|
|
11,927 |
|
|
|
(4,669 |
) |
|
6.93 |
% |
|
|
37,464 |
|
|
|
(176,859 |
) |
|
6.49 |
% |
|
|
35,965 |
|
|
|
(6,094 |
) |
Commercial mortgage loans on real estate, at amortized cost |
|
6.30 |
% |
|
|
23,550 |
|
|
|
|
|
|
6.79 |
% |
|
|
23,457 |
|
|
|
|
|
|
6.44 |
% |
|
|
71,174 |
|
|
|
952 |
|
|
6.78 |
% |
|
|
67,590 |
|
|
|
|
|
Policy loans |
|
7.11 |
% |
|
|
1,011 |
|
|
|
|
|
|
5.22 |
% |
|
|
755 |
|
|
|
|
|
|
6.55 |
% |
|
|
2,799 |
|
|
|
|
|
|
6.53 |
% |
|
|
2,850 |
|
|
|
|
|
Cash and short-term investments |
|
2.70 |
% |
|
|
10,470 |
|
|
|
(6 |
) |
|
4.79 |
% |
|
|
14,434 |
|
|
|
93 |
|
|
3.08 |
% |
|
|
34,629 |
|
|
|
(3 |
) |
|
4.73 |
% |
|
|
43,448 |
|
|
|
120 |
|
Other investments* |
|
3.41 |
% |
|
|
4,817 |
|
|
|
(11,020 |
) |
|
4.35 |
% |
|
|
5,950 |
|
|
|
5,164 |
|
|
5.42 |
% |
|
|
22,414 |
|
|
|
(13,349 |
) |
|
13.14 |
% |
|
|
54,813 |
|
|
|
10,612 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
|
|
|
198,727 |
|
|
$ |
(299,205 |
) |
|
|
|
|
|
200,333 |
|
|
$ |
(13,076 |
) |
|
|
|
|
|
610,628 |
|
|
$ |
(376,922 |
) |
|
|
|
|
|
620,147 |
|
|
$ |
(10,592 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment expenses |
|
|
|
|
|
(6,413 |
) |
|
|
|
|
|
|
|
|
|
(6,284 |
) |
|
|
|
|
|
|
|
|
|
(19,329 |
) |
|
|
|
|
|
|
|
|
|
(18,900 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income |
|
|
|
|
$ |
192,314 |
|
|
|
|
|
|
|
|
|
$ |
194,049 |
|
|
|
|
|
|
|
|
|
$ |
591,299 |
|
|
|
|
|
|
|
|
|
$ |
601,247 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross realized gains |
|
|
|
|
|
|
|
|
$ |
15,645 |
|
|
|
|
|
|
|
|
|
$ |
8,847 |
|
|
|
|
|
|
|
|
|
$ |
55,110 |
|
|
|
|
|
|
|
|
|
$ |
30,009 |
|
Gross realized losses |
|
|
|
|
|
|
|
|
|
(85,702 |
) |
|
|
|
|
|
|
|
|
|
(15,224 |
) |
|
|
|
|
|
|
|
|
|
(131,902 |
) |
|
|
|
|
|
|
|
|
|
(33,902 |
) |
Other-than-temporary impairments on available for sale securities |
|
|
|
|
|
|
|
|
|
(229,148 |
) |
|
|
|
|
|
|
|
|
|
(6,699 |
) |
|
|
|
|
|
|
|
|
|
(300,130 |
) |
|
|
|
|
|
|
|
|
|
(6,699 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net realized (losses) gains |
|
|
|
|
|
|
|
|
$ |
(299,205 |
) |
|
|
|
|
|
|
|
|
$ |
(13,076 |
) |
|
|
|
|
|
|
|
|
$ |
(376,922 |
) |
|
|
|
|
|
|
|
|
$ |
(10,592 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* |
Consists primarily of investments in joint venture partnerships, invested assets associated with a modified coinsurance agreement, and invested assets associated with the Assurant
Investment Plan. |
18
Assurant, Inc. and Subsidiaries
Summary of Net Operating Income Disclosed Items - (1)
Income / (Expense) Items
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
($ in millions, after-tax) |
|
|
|
For the Three Months Ended |
|
|
|
|
September 30, 2008 |
|
|
June 30, 2008 |
|
|
March 31, 2008 |
|
|
December 31, 2007 |
|
|
September 30, 2007 |
|
|
June 30, 2007 |
|
|
March 31, 2007 |
|
|
|
|
$ |
|
|
Diluted EPS |
|
|
$ |
|
|
Diluted EPS |
|
|
$ |
|
|
Diluted EPS |
|
|
$ |
|
|
Diluted EPS |
|
|
$ |
|
|
Diluted EPS |
|
|
$ |
|
|
Diluted EPS |
|
|
$ |
|
|
Diluted EPS |
|
Assurant Solutions: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fees from sale of US pre-need independent franchise |
|
(a) |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
3.5 |
|
|
$ |
0.03 |
|
|
$ |
|
|
|
$ |
|
|
Loss from repriced/discontinued international product |
|
(b)(c) |
|
$ |
|
|
|
$ |
|
|
|
$ |
(6.9 |
) |
|
$ |
(0.06 |
) |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
(2.2 |
) |
|
$ |
(0.02 |
) |
|
$ |
(4.4 |
) |
|
$ |
(0.04 |
) |
|
$ |
|
|
|
$ |
|
|
Reconciliation of client commissions project |
|
(c) |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
3.8 |
|
|
$ |
0.03 |
|
|
$ |
0.6 |
|
|
$ |
0.01 |
|
|
$ |
4.5 |
|
|
$ |
0.04 |
|
|
$ |
|
|
|
$ |
|
|
Client related settlements |
|
(c)(a) |
|
$ |
(7.7 |
) |
|
$ |
(0.06 |
) |
|
$ |
|
|
|
$ |
|
|
|
$ |
11.7 |
|
|
$ |
0.10 |
|
|
$ |
(3.4 |
) |
|
$ |
(0.03 |
) |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
Assurant Specialty Property: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of client commissions project |
|
(c) |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
5.9 |
|
|
$ |
0.05 |
|
|
$ |
2.3 |
|
|
$ |
0.02 |
|
|
$ |
5.5 |
|
|
$ |
0.04 |
|
|
$ |
|
|
|
$ |
|
|
Catastrophe losses, net of reinsurance (2) |
|
(b) |
|
$ |
(86.2 |
) |
|
$ |
(0.73 |
) |
|
$ |
(11.5 |
) |
|
$ |
(0.10 |
) |
|
$ |
|
|
|
$ |
|
|
|
$ |
(22.2 |
) |
|
$ |
(0.19 |
) |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
Client related settlements |
|
(c) |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
4.6 |
|
|
$ |
0.04 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
Reinsurance reinstatement premiums |
|
(e) |
|
$ |
(8.6 |
) |
|
$ |
(0.07 |
) |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
Assurant Health: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Legal related settlements |
|
(c) |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
2.5 |
|
|
$ |
0.02 |
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
|
|
|
|
|
|
|
$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assurant Employee Benefits: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in administration of state specific contract provisions |
|
(b) |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
(2.1 |
) |
|
$ |
(0.02 |
) |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
Assurant Corporate and Other: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses related to SEC investigation (3) |
|
(c) |
|
$ |
|
|
|
$ |
|
|
|
$ |
(3.0 |
) |
|
$ |
(0.03 |
) |
|
$ |
(1.6 |
) |
|
$ |
(0.01 |
) |
|
$ |
(4.3 |
) |
|
$ |
(0.04 |
) |
|
$ |
(3.2 |
) |
|
$ |
(0.03 |
) |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
Change in certain tax liabilities/receivables |
|
(d) |
|
$ |
(4.0 |
) |
|
$ |
(0.03 |
) |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
(6.4 |
) |
|
$ |
(0.05 |
) |
|
$ |
(0.6 |
) |
|
$ |
(0.01 |
) |
|
$ |
2.9 |
|
|
$ |
0.02 |
|
|
$ |
(5.8 |
) |
|
$ |
(0.05 |
) |
Statement of Operations line impact:
(a) |
Fees and other income |
(b) |
Policyholder benefits |
(c) |
Selling, underwriting, general and administrative expenses |
(1) |
Schedule excludes investment income from real estate joint ventures, which are shown separately in the Consolidated and Segment statements of operations. |
(2) |
Historically, disclosed catastrophe losses include individual Insurance Services Office (ISO) events with losses greater than $5 million. Catastrophe losses in the three months
ended September 30, 2008 and September 30, 2007 include paid losses and case reserves on all ISO events, but do not include IBNR reserves. |
(3) |
Assurant incurred $2.1 million after-tax of expenses related to the SEC investigation during the three months ended September 30, 2008; however, Assurant received $2.1 million
after-tax of expense reimbursements from its Director & Officer Insurance carriers during the three months ended September 30, 2008. |
19
Exhibit I
Assurant, Inc. and Subsidiaries
Top 30 Issuer Exposures
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
($ in thousands) |
|
As of September 30, 2008 |
|
|
Fixed Maturity Securities |
|
|
Preferred Stocks |
|
|
Fair Value |
|
Book Value |
|
Unrealized Gain/Loss |
|
|
Fair Value |
|
Book Value |
|
Unrealized Gain/Loss |
|
Issuer |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General Electric |
|
$ |
110,285 |
|
$ |
128,008 |
|
$ |
(17,723 |
) |
|
$ |
9,765 |
|
$ |
10,100 |
|
$ |
(335 |
) |
HSBC Holdings PLC |
|
|
70,630 |
|
|
77,418 |
|
|
(6,788 |
) |
|
|
27,172 |
|
|
33,405 |
|
|
(6,233 |
) |
Bank of America Corporation |
|
|
63,506 |
|
|
69,918 |
|
|
(6,412 |
) |
|
|
26,444 |
|
|
35,249 |
|
|
(8,805 |
) |
AT&T Inc. |
|
|
83,781 |
|
|
86,182 |
|
|
(2,401 |
) |
|
|
4,135 |
|
|
4,460 |
|
|
(325 |
) |
JPMorgan Chase & Company |
|
|
58,348 |
|
|
66,732 |
|
|
(8,384 |
) |
|
|
16,784 |
|
|
19,040 |
|
|
(2,256 |
) |
Wells Fargo & Company |
|
|
54,569 |
|
|
58,532 |
|
|
(3,963 |
) |
|
|
13,691 |
|
|
14,852 |
|
|
(1,161 |
) |
Canadian Imperial Bank |
|
|
66,165 |
|
|
67,100 |
|
|
(935 |
) |
|
|
|
|
|
|
|
|
|
|
Citigroup Inc. |
|
|
44,905 |
|
|
59,941 |
|
|
(15,036 |
) |
|
|
20,563 |
|
|
31,326 |
|
|
(10,763 |
) |
IBM Corporation |
|
|
64,207 |
|
|
68,080 |
|
|
(3,873 |
) |
|
|
558 |
|
|
617 |
|
|
(59 |
) |
Midamerican Energy Holdings |
|
|
58,411 |
|
|
63,935 |
|
|
(5,524 |
) |
|
|
5,251 |
|
|
5,920 |
|
|
(669 |
) |
US Bancorp |
|
|
25,625 |
|
|
35,358 |
|
|
(9,733 |
) |
|
|
34,212 |
|
|
38,808 |
|
|
(4,596 |
) |
Verizon Communications Inc. |
|
|
57,295 |
|
|
64,339 |
|
|
(7,044 |
) |
|
|
2,261 |
|
|
2,758 |
|
|
(497 |
) |
Comcast Corporation |
|
|
48,944 |
|
|
54,791 |
|
|
(5,847 |
) |
|
|
8,959 |
|
|
11,889 |
|
|
(2,930 |
) |
Prudential Financial Inc. |
|
|
51,571 |
|
|
55,729 |
|
|
(4,158 |
) |
|
|
526 |
|
|
807 |
|
|
(281 |
) |
Wal-Mart Stores Inc. |
|
|
51,249 |
|
|
54,355 |
|
|
(3,106 |
) |
|
|
|
|
|
|
|
|
|
|
Deere & Company |
|
|
49,101 |
|
|
49,301 |
|
|
(200 |
) |
|
|
|
|
|
|
|
|
|
|
FMR LLC |
|
|
48,369 |
|
|
55,109 |
|
|
(6,740 |
) |
|
|
|
|
|
|
|
|
|
|
Goldman Sachs Group Inc. |
|
|
38,476 |
|
|
52,286 |
|
|
(13,810 |
) |
|
|
9,561 |
|
|
13,311 |
|
|
(3,750 |
) |
Manulife Financial Corporation |
|
|
35,109 |
|
|
37,155 |
|
|
(2,046 |
) |
|
|
12,082 |
|
|
12,640 |
|
|
(558 |
) |
Duke Energy Corp |
|
|
46,688 |
|
|
50,490 |
|
|
(3,802 |
) |
|
|
|
|
|
|
|
|
|
|
Burlington Northern Santa Fe |
|
|
44,930 |
|
|
46,656 |
|
|
(1,726 |
) |
|
|
|
|
|
|
|
|
|
|
News Corporation |
|
|
43,826 |
|
|
49,087 |
|
|
(5,261 |
) |
|
|
|
|
|
|
|
|
|
|
ConocoPhillips |
|
|
43,757 |
|
|
43,712 |
|
|
45 |
|
|
|
|
|
|
|
|
|
|
|
Wyeth |
|
|
42,847 |
|
|
44,843 |
|
|
(1,996 |
) |
|
|
|
|
|
|
|
|
|
|
Target Corporation |
|
|
41,162 |
|
|
42,538 |
|
|
(1,376 |
) |
|
|
|
|
|
|
|
|
|
|
Allstate Corporation |
|
|
40,248 |
|
|
45,871 |
|
|
(5,623 |
) |
|
|
|
|
|
|
|
|
|
|
Southern Company |
|
|
18,654 |
|
|
20,535 |
|
|
(1,881 |
) |
|
|
20,844 |
|
|
23,722 |
|
|
(2,878 |
) |
Procter & Gamble Company |
|
|
38,001 |
|
|
38,205 |
|
|
(204 |
) |
|
|
|
|
|
|
|
|
|
|
FPL Group Inc. |
|
|
34,656 |
|
|
36,202 |
|
|
(1,546 |
) |
|
|
3,058 |
|
|
3,670 |
|
|
(612 |
) |
Credit Suisse Group AG |
|
|
29,466 |
|
|
32,861 |
|
|
(3,395 |
) |
|
|
8,243 |
|
|
10,147 |
|
|
(1,904 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
1,504,781 |
|
$ |
1,655,269 |
|
$ |
(150,488 |
) |
|
$ |
224,109 |
|
$ |
272,721 |
|
$ |
(48,612 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20
Exhibit II
Assurant, Inc. and Subsidiaries
Commercial Mortgage Loans Summary
(unaudited)
|
|
|
|
|
|
|
($ in thousands) |
|
September 30, 2008 |
|
|
Book Value |
|
% of Total |
|
Summary of Commercial Mortgage Loans |
|
|
|
|
|
|
Geographic Region |
|
|
|
|
|
|
Pacific |
|
$ |
508,577 |
|
33.8 |
% |
Middle Atlantic |
|
|
274,339 |
|
18.3 |
% |
New England |
|
|
178,968 |
|
11.9 |
% |
South Atlantic |
|
|
164,972 |
|
11.0 |
% |
Mountain |
|
|
164,498 |
|
11.0 |
% |
West South Central |
|
|
87,487 |
|
5.8 |
% |
West North Central |
|
|
46,852 |
|
3.1 |
% |
East South Central |
|
|
28,749 |
|
1.9 |
% |
Canada |
|
|
27,467 |
|
1.8 |
% |
East North Central |
|
|
20,830 |
|
1.4 |
% |
|
|
|
|
|
|
|
Total |
|
$ |
1,502,739 |
|
100.0 |
% |
|
|
|
|
|
|
|
Property Type |
|
|
|
|
|
|
Retail |
|
$ |
511,453 |
|
34.0 |
% |
Office |
|
|
493,266 |
|
32.8 |
% |
Industrial |
|
|
365,718 |
|
24.4 |
% |
Other |
|
|
70,195 |
|
4.7 |
% |
Apartments |
|
|
62,107 |
|
4.1 |
% |
|
|
|
|
|
|
|
Subtotal |
|
$ |
1,502,739 |
|
100.0 |
% |
|
|
|
|
|
|
|
Allowance for losses |
|
|
|
|
0.0 |
% |
Unamortized fees and costs |
|
|
|
|
0.0 |
% |
|
|
|
|
|
|
|
Total |
|
$ |
1,502,739 |
|
100.0 |
% |
|
|
|
|
|
|
|
Loan Size |
|
|
|
|
|
|
Under $3 million |
|
$ |
589,352 |
|
39.2 |
% |
$3 million but less than $6 million |
|
|
502,015 |
|
33.4 |
% |
$6 million but less than $9 million |
|
|
258,100 |
|
17.2 |
% |
$9 million but less than $12 million |
|
|
39,378 |
|
2.6 |
% |
$12 million and over |
|
|
113,894 |
|
7.6 |
% |
|
|
|
|
|
|
|
Total |
|
$ |
1,502,739 |
|
100.0 |
% |
|
|
|
|
|
|
|
Commercial Mortgage Loan Information by Vintage
(loan amounts in thousands)
As of September 30, 2008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loan year |
|
Book value |
|
Delinquent loan balance |
|
Number of loans |
|
Number of delinquent loans |
|
Average balance per loan |
|
Average loan-to-value (1) |
|
2004 and prior |
|
$ |
660,345 |
|
$ |
|
|
311 |
|
|
|
$ |
2,118 |
|
31 |
% |
2005 |
|
|
257,963 |
|
|
|
|
72 |
|
|
|
|
3,583 |
|
50 |
% |
2006 |
|
|
182,231 |
|
|
|
|
64 |
|
|
|
|
2,847 |
|
45 |
% |
2007 |
|
|
272,640 |
|
|
|
|
90 |
|
|
|
|
3,029 |
|
54 |
% |
2008 |
|
|
129,559 |
|
|
|
|
35 |
|
|
|
|
3,702 |
|
59 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
1,502,739 |
|
$ |
|
|
572 |
|
|
|
$ |
2,625 |
|
40 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1) |
Based upon property appraisals as of June 30, 2008. |
21
GRAPHIC
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