-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CTko8J85vYRL+x4DiZW0lpjFA7XTqsBz7IE2ikfqgZfy6H2QMCbBTs2Sahv/CXBt d+CTtYtdz9T2FPUS59LkuQ== 0000933537-96-000015.txt : 19960329 0000933537-96-000015.hdr.sgml : 19960329 ACCESSION NUMBER: 0000933537-96-000015 CONFORMED SUBMISSION TYPE: 10-K405 PUBLIC DOCUMENT COUNT: 12 CONFORMED PERIOD OF REPORT: 19951231 FILED AS OF DATE: 19960328 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN FINANCIAL GROUP INC /OH/ CENTRAL INDEX KEY: 0000933537 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 311422526 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K405 SEC ACT: 1934 Act SEC FILE NUMBER: 001-11453 FILM NUMBER: 96540170 BUSINESS ADDRESS: STREET 1: ONE E FOURTH ST CITY: CINCINNATI STATE: OH ZIP: 45202 BUSINESS PHONE: 5135796600 MAIL ADDRESS: STREET 1: ONE EAST FOURTH STREET CITY: CINCINNATI STATE: OH ZIP: 45202 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN PREMIER GROUP INC DATE OF NAME CHANGE: 19941208 10-K405 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Fiscal Year Ended Commission File December 31, 1995 No. 1-11453 AMERICAN FINANCIAL GROUP, INC. Incorporated under IRS Employer I.D. the Laws of Ohio No. 31-1422526 One East Fourth Street, Cincinnati, Ohio 45202 (513) 579-2121 Securities Registered Pursuant to Section 12(b) of the Act: Name of Each Exchange Title of Each Class on which Registered Common Stock New York Stock Exchange Securities Registered Pursuant to Section 12(g) of the Act: None Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to such filing requirements for the past 90 days. Yes X No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and need not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X] As of February 29, 1996, there were 60,362,061 shares of the Registrant's Common Stock outstanding, excluding 18,666,614 shares owned by subsidiaries. The aggregate market value of the Common Stock held by non-affiliates at that date, was approximately $1.1 billion (based upon non-affiliate holdings of 34,486,536 shares and a market price of $31.875 per share.) _____________ Documents Incorporated by Reference: Proxy Statement for the 1996 Annual Meeting of Shareholders (portions of which are incorporated by reference into Part III hereof). AMERICAN FINANCIAL GROUP, INC. INDEX TO ANNUAL REPORT ON FORM 10-K Part I Page Item 1 - Business: Introduction 1 Property and Casualty Operations 2 Annuity Operations 14 Other Companies 17 Investment Portfolio 17 Regulation 20 Item 2 - Properties 22 Item 3 - Legal Proceedings 22 Item 4 - Submission of Matters to a Vote of Security Holders * Part II Item 5 - Market for Registrant's Common Equity and Related Stockholder Matters 24 Item 6 - Selected Financial Data 25 Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations 26 Item 8 - Financial Statements and Supplementary Data 34 Item 9 - Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 34 Part III Item 10 - Directors and Executive Officers of the Registrant 35 Item 11 - Executive Compensation 35 Item 12 - Security Ownership of Certain Beneficial Owners and Management 35 Item 13 - Certain Relationships and Related Transactions 35 Part IV Item 14 - Exhibits, Financial Statement Schedules and Reports on Form 8-K S-1 * The response to this Item is "none". PART I ITEM 1 Business Introduction American Financial Group, Inc. ("AFG") was incorporated as an Ohio corporation in 1994. Its address is One East Fourth Street, Cincinnati, Ohio 45202; its phone number is (513) 579-2121. AFG is a holding company which, through its subsidiaries, is engaged primarily in specialty and multi-line property and casualty insurance businesses and in the sale of tax-deferred annuities. AFG's property and casualty operations originated in 1872 and are the fifteenth largest property and casualty group in the United States based on 1994 statutory net premiums written of $3.1 billion. AFG was formed for the purpose of acquiring American Financial Corporation ("AFC") and American Premier Underwriters, Inc. ("APU" or "American Premier") in merger transactions completed on April 3, 1995 (the "Mergers"). At December 31, 1995, Carl H. Lindner, members of his immediate family and trusts for their benefit (collectively the "Lindner Family") beneficially owned approximately 44% of AFG's outstanding voting common stock. The Mergers At the date of the Mergers, AFC held 18.7 million shares of APU (44% of the then-outstanding shares). In the Mergers, AFG issued 71.4 million shares of its Common Stock in exchange for all of the outstanding common stock of AFC and APU. The 18.7 million shares of Common Stock held by AFC and its subsidiaries are accounted for by AFG as retired. For financial reporting purposes, because the former shareholders of AFC owned more than 50% of AFG following the Mergers, the financial statements of AFG for periods prior to the Mergers are those of AFC. The operations of APU are included in AFG's financial statements from the effective date of the Mergers. General Generally, companies have been included in AFG's consolidated financial statements when the ownership of voting securities has exceeded 50%; for investments below that level but above 20%, companies have been accounted for as investees. (See Note F to AFG's financial statements.) The following table shows AFG's percentage ownership of voting securities of its significant affiliates over the past several years: Ownership at December 31, 1995 1994 1993 1992 1991 American Financial Corporation 79% n/a n/a n/a n/a American Premier Underwriters 100% 42% 41% 51% 50% Great American Insurance Group 100% 100% 100% 100% 100% American Annuity Group 81% 80% 80% 82% 39% Great American Life Insurance Company (a) (a) (a) (a) 100% American Financial Enterprises 83% 83% 83% 83% 82% Chiquita Brands International 44% 46% 46% 46% 48% Citicasters 38% 37% 20% 40% 40% General Cable - (b) 45% 45% - (a) Sold to American Annuity Group in December 1992. (b) Sold in June 1994. 100%-owned by American Premier prior to spin-off in July 1992. Ownership percentage excludes shares held by American Premier for future distribution aggregating 12%. 1 The following summarizes the more significant changes in ownership percentages shown in the above table. American Financial Corporation For financial reporting purposes, AFC is the predecessor to AFG. In April 1995, AFC became a subsidiary of AFG as a result of the Mergers. Holders of AFC Series F and G Preferred Stock were granted voting rights equal to approximately 21% of the total voting power of AFC shareholders immediately prior to the Mergers. American Premier Underwriters In 1993, American Financial Enterprises, Inc. ("AFEI") sold 4.5 million shares of American Premier common stock in a secondary public offering. In April 1995, APU became a subsidiary of AFG as a result of the Mergers. American Annuity Group On December 31, 1992, American Annuity purchased Great American Life Insurance Company ("GALIC") from Great American Insurance Company ("GAI"). In connection with the acquisition, GAI purchased 5.1 million shares of American Annuity's common stock pursuant to a cash tender offer and 17.1 million additional shares directly from American Annuity. Citicasters In December 1993, Great American Communications Company ("GACC") completed a prepackaged plan of reorganization. In the restructuring, AFC's previous holdings of GACC stock and debt were exchanged for 20% of the new common stock. GACC changed its name to Citicasters to reflect the nature of its business. In June 1994, AFEI purchased approximately 10% of Citicasters common stock. In the second half of 1994, Citicasters repurchased and retired approximately 21% of its common stock. In February 1996, Citicasters entered into a merger agreement with Jacor Communications, Inc. Under the agreement, each Citicasters shareholder, including AFG and its subsidiaries, will receive cash and warrants to purchase Jacor common stock. Consummation of the transaction is subject to regulatory approvals, and certain adjustments to the price will be made if the transaction does not close by September 30, 1996. General Cable In 1992, American Premier distributed to its shareholders approximately 88% of the stock of General Cable, which was formed to own certain of American Premier's manufacturing businesses. AFC and its subsidiaries received approximately 45% of General Cable in the spin-off. In 1994, an unaffiliated company acquired all of the common stock of General Cable including AFC's and the 12% which had been retained by American Premier. Property and Casualty Insurance Operations AFG manages and operates its property and casualty business in three major business segments: Nonstandard Automobile Insurance, Specialty Lines and Commercial and Personal Lines. Each segment is comprised of multiple business units which operate autonomously but with strong central financial controls and full accountability. Decentralized control allows each unit the autonomy necessary to respond to local and specialty market conditions while capitalizing on the efficiencies of centralized investment, actuarial, financial and legal support functions. AFG's property and casualty insurance operations employ approximately 7,600 persons. Unless indicated otherwise, the financial information presented for the property and casualty insurance operations is presented based on generally accepted accounting principles ("GAAP") and includes the insurance operations of American Premier for all periods. 2 The following table presents AFG's major property & casualty insurance subsidiaries showing their size (in millions), segment and A.M. Best rating. 1995 Net Written Premiums Commercial NSA A.M. Best and Personal Specialty Group Rating Great American $717 $ 672 $ - A Republic Indemnity - 288 - A Mid-Continent - 84 - A American Empire Surplus Lines - 34 - A+ Atlanta Casualty - - 514 A Windsor - - 352 A Infinity - - 232 A Leader National - - 84 A- Transport - - 74 A Other - 19 21 $717 $1,097 $1,277 The primary objective of the property and casualty insurance operations is to achieve underwriting profitability. Underwriting profitability is measured by the combined ratio which is a sum of the ratios of underwriting expenses, losses, and loss adjustment expenses to premiums. When the combined ratio is under 100%, underwriting results are generally considered profitable; when the ratio is over 100%, underwriting results are generally considered unprofitable. The combined ratio does not reflect investment income, other income or federal income taxes. Management's focus on underwriting performance has resulted in a statutory combined ratio averaging 100.9% for the period 1991 to 1995, as compared to 109.3% for the property and casualty industry over the same period (Source: "Best's Review - Property/Casualty" - January 1996 Edition). Management's philosophy is to refrain from writing business that is not expected to produce an underwriting profit even if it is necessary to limit premium growth to do so. For 1995, net written premiums were nearly $3.1 billion, approximately the same level as in 1994. Premium growth in most of the insurance lines has been offset by a decline in California workers' compensation writings. Aside from the California workers' compensation business, net written premiums grew 6% in 1995. The following table shows (in millions) the performance of AFG's property and casualty insurance operations in various categories. While financial data is reported on a statutory basis for insurance regulatory purposes, it is reported in accordance with GAAP for shareholder and other investment purposes. In general, statutory accounting results in lower capital surplus and net earnings than result from application of GAAP. Major differences include charging policy acquisition costs to expense as incurred rather than spreading the costs over the periods covered by the policies; netting of reinsurance recoverables and prepaid reinsurance premiums against the corresponding liability; requiring additional loss reserves; and charging to surplus certain assets, such as furniture and fixtures and agents' balances over 90 days old. 1995 1994 1993 Statutory Basis Premiums Earned $3,006 $2,915 $2,516 Admitted Assets 6,753 6,398 5,808 Unearned Premiums 1,160 1,093 912 Loss and Loss Adjustment Expense ("LAE") Reserves 3,394 3,275 3,061 Capital and Surplus 1,595 1,586 1,454 3 1995 1994 1993 GAAP Basis Premiums Earned $3,031 $2,945 $2,517 Total Assets 9,002 8,617 7,869 Unearned Premiums 1,294 1,213 1,012 Loss and LAE Reserves 4,097 4,021 3,679 Shareholder's Equity 2,893 2,615 2,431 The following table presents certain information with respect to AFG's property and casualty insurance operations (dollars in millions): 1995 1994 1993 Net written premiums $3,092 $3,124 $2,667 Net earned premiums $3,031 $2,945 $2,517 Loss and LAE 2,265 2,077 1,734 Underwriting expenses 792 770 683 Policyholder dividends 8 84 95 Underwriting profit (loss) ($ 34) $ 14 $ 5 GAAP ratios: Loss and LAE ratio 74.8% 70.5% 68.9% Underwriting expense ratio 26.1 26.1 27.1 Policyholder dividend ratio .3 2.8 3.8 Combined ratio 101.2% 99.4% 99.8% Statutory ratios: Loss and LAE ratio 74.8% 71.0% 69.3% Underwriting expense ratio 25.9 26.3 26.9 Policyholder dividend ratio 1.7 3.6 2.5 Combined ratio 102.4% 100.9% 98.7% Industry statutory combined ratio(a) 107.2% 108.5% 106.9% (a) Ratios are derived from "Best's Review - Property/Casualty" (January 1996 Edition). Nonstandard Automobile Insurance General. The Nonstandard Automobile Insurance segment ("NSA Group") underwrites private passenger automobile physical damage and liability insurance policies for "nonstandard risks." Nonstandard insureds are those individuals who are unable to obtain insurance through standard market carriers due to factors such as age, record of prior accidents, driving violations, particular occupation or type of vehicle. Premium rates for nonstandard risks are generally higher than for standard risks. Total private passenger automobile insurance premiums written by insurance carriers in the United States in 1995 have been estimated by A.M. Best to be approximately $103 billion. Because it can be viewed as a residual market, the size of the nonstandard private passenger automobile insurance market changes with the insurance environment and grows when standard coverage becomes more restrictive. When this occurs, the criteria which differentiate standard from nonstandard insurance risks change. The size of the voluntary nonstandard market is also affected by rate levels adopted by state administered involuntary plans. Although these factors make it difficult to estimate the size of the nonstandard market, management believes that the voluntary nonstandard market has accounted for approximately 15% of total private passenger automobile insurance premiums written in recent years. The NSA Group attributes its premium growth in recent years primarily to entry into additional states, increased market penetration in its existing states, overall growth in the nonstandard market, premium rate increases and its purchase of Leader National. Management believes the nonstandard market has experienced growth in recent years as standard insurers have become more restrictive in the types of risks they write. 4 The NSA Group writes business in 42 states and holds licenses to write policies in 48 states and the District of Columbia. The U.S. geographic distribution of the NSA Group's statutory direct written premiums in 1995 compared to 1991, was as follows: State 1995 1991 State 1995 1991 Texas 12.2% * Alabama 2.9% 4.5% Florida 11.2 19.3% Washington 2.7 * Georgia 9.2 17.5 Missouri 2.6 2.1 Pennsylvania 8.0 * Kentucky 2.2 * California 7.5 10.3 Virginia * 5.6 Connecticut 5.0 4.8 Ohio * 2.9 Arizona 4.1 2.3 Arkansas * 2.6 Tennessee 3.8 4.8 Oregon * 2.5 Oklahoma 3.5 * Other 18.7 13.4 Indiana 3.3 3.7 100.0% 100.0% Mississippi 3.1 3.7 _____________ * less than 2% In addition, AFG writes approximately $50 million (4%) of its net premiums annually in the United Kingdom. Management believes that the NSA Group's underwriting success as compared to the automobile insurance industry as a whole has been due, in part, to the refinement of various risk profiles, thereby dividing the consumer market into more defined segments which can be underwritten or priced properly. The NSA Group also generally writes policies of short duration which allow more frequent rating evaluations of individual risks, providing management greater flexibility in the ongoing assessment of the business. In addition, the NSA Group has implemented cost control measures both in the underwriting and claims handling areas. The following table presents certain information with respect to AFG's NSA Group insurance operations (dollars in millions): 1995 1994 1993 Net written premiums $1,277 $1,186 $ 916 Net earned premiums $1,246 $1,097 $ 812 Loss and LAE 1,036 833 581 Underwriting expenses 273 265 208 Underwriting profit (loss) ($ 63) ($ 1) $ 23 GAAP ratios: Loss and LAE ratio 83.2% 75.9% 71.6% Underwriting expense ratio 22.0 24.1 25.6 Combined ratio 105.2% 100.0% 97.2% Statutory ratios: Loss and LAE ratio 83.1% 76.0% 72.5% Underwriting expense ratio 21.6 23.9 24.5 Combined ratio 104.7% 99.9% 97.0% Industry statutory combined ratio(a) 102.3% 101.3% 101.7% (a) This information refers to the private passenger automobile industry statutory combined ratio derived from "Best's Review - Property/Casualty" (January 1996 Edition). Although AFG believes that there is no reliable regularly published combined ratio data for the nonstandard automobile insurance industry, AFG believes that such a combined ratio would be lower than the private passenger automobile industry average shown above. 5 Marketing. Each of the principal units in the NSA Group is responsible for its own marketing, sales, underwriting and claims processing. Sales efforts are primarily directed toward independent agents to convince them to select an NSA Group insurance company for their customers. These units each write policies through several thousand independent agents. Of the approximately one million NSA Group policies in force at December 31, 1995, approximately 90% had policy limits of $50,000 or less per occurrence. Most NSA Group policies are written for policy periods of six months or less, with some as short as one month. Competition. A large number of national, regional and local insurers write nonstandard private passenger automobile insurance coverage. Insurers in this market generally compete on the basis of price (including differentiation on liability limits, variety of coverages offered and deductibles), geographic availability and ease of enrollment and, to a lesser extent, reputation for claims handling, financial stability and customer service. NSA Group management believes that sophisticated data analysis for refinement of risk profiles has helped the NSA Group to compete successfully. The NSA Group attempts to provide selected pricing for a wider spectrum of risks and with a greater variety of payment options, deductibles and limits of liability than are offered by many of its competitors. Specialty Lines General. The Specialty Lines segment emphasizes the writing of specialized insurance coverage where AFG personnel are experts in particular lines of business or customer groups including California workers' compensation, executive liability, ocean and inland marine, agricultural-related coverages (allied lines), non-profit liability, umbrella and excess and surplus lines. The Specialty Lines workers' compensation operations write coverage for statutory prescribed benefits payable to employees (principally in California) who are injured on the job. The executive and professional liability divisions market liability coverage for lawyers and corporate directors and officers. Ocean and inland marine businesses provide such coverage as marine cargo, boat dealers, marina operators/dealers, excursion vessels, builder's risk, contractor's equipment, excess property and transportation cargo. The agricultural-related businesses provide multi-peril crop insurance covering all weather and disease perils as well as coverage for full-time operating farms/ranches and agribusiness operations on a nationwide basis through independent agents who specialize in the rural market. The non-profit liability business provides property, general/professional liability, automobile, trustee liability, umbrella and crime coverage for a wide range of non-profit organizations. These operations also provide excess and surplus commercial property and casualty insurance in a variety of industries. Specialization is the key element to the underwriting success of these business units. Each unit has independent management with significant operating autonomy to oversee the important operational functions of its business such as underwriting, pricing, marketing, policy processing and claims service. These specialty lines are opportunistic and their premium volume will vary based on current market conditions. AFG continually evaluates new specialty markets. The U.S. geographic distribution of the Specialty Lines statutory direct written premiums in 1995 compared to 1991, was as follows: State 1995 1991 State 1995 1991 California 32.6% 45.2% Florida 3.1% * Texas 8.4 4.1 New Jersey 2.8 2.4% New York 5.4 5.4 Pennsylvania 2.3 2.8 Massachusetts 4.5 2.2 Ohio 2.1 2.3 Illinois 3.6 3.3 Michigan 2.1 2.2 Oklahoma 3.5 8.2 Other 29.6 21.9 100.0% 100.0% _____________ * less than 2% 6 The following table sets forth a distribution of statutory net written premiums for AFG's Specialty Lines by NAIC annual statement line for 1995 compared to 1991: 1995 1991 Workers' compensation 29.8% 47.7% Other liability 20.4 15.5 Commercial multi-peril 8.5 3.1 Allied lines 8.4 4.4 Inland marine 7.9 6.0 Auto liability 7.6 9.4 Ocean marine 4.5 3.2 Surety 2.9 2.8 Fire 2.5 1.5 Auto physical damage 2.1 2.9 Other 5.4 3.5 100.0% 100.0% The following table presents certain information with respect to AFG's Specialty Lines insurance operations (dollars in millions): 1995 1994 1993 Net written premiums $1,097 $1,250 $1,079 Net earned premiums $1,085 $1,185 $1,035 Loss and LAE 730 785 667 Underwriting expenses 302 291 235 Policyholder dividends (3) 76 93 Underwriting profit $ 56 $ 33 $ 40 GAAP ratios: Loss and LAE ratio 67.2% 66.2% 64.4% Underwriting expense ratio 27.9 24.6 22.7 Policyholder dividend ratio (.3) 6.4 9.0 Combined ratio 94.8% 97.2% 96.1% Statutory ratios: Loss and LAE ratio 67.5% 66.7% 64.8% Underwriting expense ratio 28.1 25.2 23.3 Policyholder dividend ratio 4.2 8.5 6.0 Combined ratio 99.8% 100.4% 94.1% Industry statutory combined ratio(a) 107.2% 108.5% 106.9% (a) Ratios are derived from "Best's Review - Property/Casualty" (January 1996 Edition). Marketing. The Specialty Lines operations direct their sales efforts primarily toward independent property and casualty insurance agents and brokers. These businesses write insurance through more than 5,000 agents and have more than 250,000 policies in force. Competition. These businesses compete with other insurers as well as the California State Fund in the California workers' compensation insurance market. Because of the specialty nature of these coverages, competition is based primarily on service to policyholders and agents, specific characteristics of products offered and reputation for claims handling. Price, commissions and profit sharing terms are also important factors. Competitors include individual insurers and insurance groups of varying sizes, some of which are mutual insurance companies possessing competitive advantages in that all their profits inure to their policyholders. Management believes that sophisticated data analysis for refinement of risk profiles, extensive specialized knowledge and loss prevention service have helped these businesses compete successfully. 7 Commercial and Personal Lines General. Major commercial lines of business are workers' compensation, commercial multi-peril, umbrella (including primary and excess layers) and general liability insurance. The workers' compensation business has experienced solid growth and profitability due to improved rate structures and favorable trends in medical care costs and the success of its Drug-Free Workplace program. AFG's Drug-Free Workplace program for workers' compensation customers assists insureds in setting up drug testing programs (as permitted by law), drug and alcohol education programs and work safety programs. At December 31, 1995, there were more than 650 insureds in 16 states with such programs producing approximately $55 million in annual net written premiums. Commercial business is written in 25 states where management believes adequate rates can be obtained and where assigned risk costs are not excessive. AFG's approach focuses on specific customer groups, such as fine restaurants, light manufacturers, high rise living units, hotels/motels and insureds with large umbrella coverages. The approach also emphasizes site visits at prospective customers to ensure underwriter familiarity with risk factors relating to each insured and to avoid those risks which have unacceptable frequency or severity exposures. Personal lines of business consist primarily of standard private passenger auto and homeowners' insurance and are written in 38 states. AFG's approach is to develop tailored rates for its personal automobile customers based on a wide variety of factors, including make and model of the insured automobile and the driving record of the insureds. The approach to homeowners business is to limit writings in locations with catastrophic exposures such as windstorms, earthquakes and hurricanes. The U.S. geographic distribution of the Commercial and Personal Lines statutory direct written premiums in 1995 compared to 1991, was as follows: State 1995 1991 State 1995 1991 Connecticut 14.1% 12.0% Florida 3.2% 2.8% New York 11.9 7.7 California 2.3 9.1 North Carolina 10.6 11.7 Massachusetts 2.2 2.6 New Jersey 9.7 7.6 Illinois 2.2 3.2 Pennsylvania 6.5 2.5 Washington * 2.7 Texas 5.0 * Oregon * 2.5 Michigan 4.0 3.5 Virginia * 2.3 Maryland 3.8 3.5 Minnesota * 2.1 Ohio 3.8 4.5 Other 20.7 19.7 100.0% 100.0% _____________ * less than 2% The following table sets forth a distribution of statutory net written premiums for AFG's Commercial and Personal Lines by NAIC annual statement line for 1995 compared to 1991: 1995 1991 Auto liability 28.8% 23.9% Workers' compensation 18.0 13.3 Commercial multi-peril 17.2 24.7 Auto physical damage 12.3 12.0 Homeowners 11.1 12.1 Other liability 7.3 9.1 Inland marine 1.7 1.8 Other 3.6 3.1 100.0% 100.0% 8 The following table presents certain information with respect to AFG's Commercial and Personal Lines insurance operations (dollars in millions): 1995 1994 1993 Net written premiums $ 717 $ 683 $666 Net earned premiums $ 698 $ 656 $664 Loss and LAE 468 430 430 Underwriting expenses 214 211 238 Policyholder dividends 11 8 2 Underwriting profit (loss) $ 5 $ 7 ($ 6) GAAP ratios: Loss and LAE ratio 66.9% 65.5% 64.8% Underwriting expense ratio 30.6 32.2 35.9 Policyholder dividend ratio 1.6 1.2 .3 Combined ratio 99.1% 98.9% 101.0% Statutory ratios: Loss and LAE ratio 67.2% 67.0% 65.0% Underwriting expense ratio 29.9 32.4 36.0 Policyholder dividend ratio .6 1.0 - Combined ratio 97.7% 100.4% 101.0% Industry statutory combined ratio(a) 107.2% 108.5% 106.9% (a) Ratios are derived from "Best's Review - Property/Casualty" (January 1996 Edition). Marketing. The Commercial and Personal Lines business units direct their sales efforts primarily toward independent agents and brokers. These businesses write insurance through more than 4,000 agents and have more than 515,000 policies in force. Competition. These businesses compete with other insurers, primarily on the basis of price (including differentiation on policy limits, coverages offered and deductibles), agent commissions and profit sharing terms. Customer service, loss prevention and reputation for claims handling are also important factors. Competitors include individual insurers and insurance groups of varying sizes, some of which are mutual insurance companies possessing competitive advantages in that all their profits inure to their policyholders. Management believes that sophisticated data analysis for refinement of risk profiles, disciplined underwriting practices and aggressive loss prevention procedures have enabled these businesses to compete successfully on the basis of price without negatively affecting underwriting profitability. Reinsurance Consistent with standard practice of most insurance companies, AFG reinsures a portion of its business with other reinsurance companies and assumes a relatively small amount of business from other insurers. Ceding reinsurance permits diversification of risks and limits the maximum loss arising from large or unusually hazardous risks or catastrophic events. AFG's insurance companies enter into separate reinsurance programs due to their differing exposures. The availability and cost of reinsurance are subject to prevailing market conditions which may affect the volume and profitability of business that is written. AFG is subject to credit risk with respect to its reinsurers, as the ceding of risk to reinsurers does not relieve AFG of its liability to its insureds. Due in part to the limited exposure on individual policies, none of the insurance companies in the NSA Group is involved to a material degree in reinsuring risks with third party insurance companies. 9 Republic Indemnity reinsures a portion of its exposure with other insurance companies to limit its maximum loss arising out of any one occurrence. Republic Indemnity retains the first $1.5 million of each loss, the next $1.5 million of each loss is reinsured with a major reinsurance company, the next $2 million of each loss is shared equally by Republic Indemnity and the reinsurance company and the remaining $145 million of each loss is covered by reinsurance treaties provided by a group of more than 50 reinsurance companies. Republic Indemnity does not assume reinsurance, except as an accommodation to policyholders who have a small percentage of their employees outside the state of California. Great American currently has treaty reinsurance programs which generally provide reinsurance coverage above specified retention maximums. For workers' compensation policies, the retention maximum is $1 million per loss occurrence with reinsurance coverage for the next $49 million. For all other casualty policies, the retention maximum is $5 million per loss occurrence with reinsurance coverage for the next $15 million. For property coverages, a property per risk excess of loss treaty is maintained with a retention maximum of $5 million per risk and reinsurance coverage for the next $25 million. For catastrophe coverage on property risks, the retention is $20 million with reinsurance covering 95% of the next $130 million in losses with an additional layer of reinsurance providing coverage for 76% of the next $50 million for the peril of wind only. In addition, GAI purchases facultative reinsurance providing coverage on a risk by risk basis, both pro rata and excess of loss, depending on the risk and available reinsurance markets. Included in "recoverables from reinsurers and prepaid reinsurance premiums" were $84 million on paid losses and LAE and $704 million on unpaid losses and LAE at December 31, 1995. The collectibility of a reinsurance balance is based upon the financial condition of a reinsurer as well as individual claim considerations. Market conditions over the past few years have forced many reinsurers into financial difficulties or liquidation proceedings. At December 31, 1995, AFG's insurance subsidiaries had an allowance of approximately $81 million for doubtful collection of reinsurance recoverables. AFG regularly monitors the financial strength of its reinsurers. This process periodically results in the transfer of risks to more financially secure reinsurers. AFG's major reinsurers include American Re- Insurance Company, Employers Reinsurance Corporation, NAC Reinsurance Corporation, Mitsui Marine and Fire Insurance Company, Ltd. and Taisho Marine & Fire Insurance Company. Management believes that this present group of reinsurers is financially sound. Premiums written for reinsurance ceded and assumed are presented in the following table (in millions): 1995 1994 1993 Reinsurance ceded $482 $422 $342 Reinsurance assumed - including involuntary pools and associations 98 119 135 Loss and Loss Adjustment Expense Reserves The consolidated financial statements include the estimated liability for unpaid losses and LAE of AFG's insurance subsidiaries. This liability represents estimates of the ultimate net cost of all unpaid losses and LAE and is determined by using case-basis evaluations and actuarial projections. These estimates are subject to the effects of changes in claim amounts and frequency and are periodically reviewed and adjusted as additional information becomes known. In accordance with industry practices, such adjustments are reflected in current year operations. Future costs of claims are projected based on historical trends adjusted for changes in underwriting standards, policy provisions, the anticipated effect of inflation and general economic trends. These anticipated trends are monitored based on actual development and are reflected in estimates of ultimate claim costs. 10 Generally, reserves for reinsurance and involuntary pools and associations are reflected in AFG's results at the amounts reported by those entities. Unless otherwise indicated, the following discussion of insurance reserves includes the reserves of American Premier's subsidiaries for only those periods following the Mergers. See Note P to the Financial Statements for an analysis of changes in AFG's estimated liability for losses and LAE, net of reinsurance (and grossed up), over the past three years on a GAAP basis. The following table presents the development of AFG's liability for losses and LAE, net of reinsurance, on a GAAP basis for the last ten years, excluding reserves of American Premier subsidiaries prior to the Mergers. The top line of the table shows the estimated liability (in millions) for unpaid losses and LAE recorded at the balance sheet date for the indicated years. The second line shows the re-estimated liability as of December 31, 1995. The remainder of the table presents development as percentages of the estimated liability. The development results from additional information and experience in subsequent years. The middle line shows a cumulative deficiency (redundancy) which represents the aggregate percentage increase (decrease) in the liability initially estimated. The lower portion of the table indicates the cumulative amounts paid as of successive periods as a percentage of the original loss reserve liability.
1985 1986 1987 1988 1989 1990 Liability for unpaid losses and loss adjustment expenses: As originally estimated $1,605 $1,843 $2,024 $2,209 $2,246 $2,137 As re-estimated at December 31, 1995 2,385 2,258 2,222 2,275 2,271 2,103 Liability re-estimated as of: One year later 109.2% 102.7% 102.5% 99.8% 100.4% 98.6% Two years later 116.7% 107.3% 103.6% 100.0% 99.3% 97.7% Three years later 123.4% 109.7% 103.1% 99.7% 98.4% 97.4% Four years later 129.9% 110.8% 102.5% 98.7% 98.2% 99.2% Five years later 132.3% 111.8% 102.6% 99.1% 101.1% 98.4% Six years later 134.8% 112.7% 103.5% 103.0% 101.1% Seven years later 136.6% 115.3% 109.4% 103.0% Eight years later 140.7% 122.1% 109.8% Nine years later 148.2% 122.5% Ten years later 148.6% Cumulative deficiency (redundancy) 48.6% 22.5% 9.8% 3.0% 1.1% (1.6%) Cumulative paid as of: One year later 45.5% 33.0% 29.2% 29.4% 32.3% 26.1% Two years later 69.0% 52.5% 49.0% 48.6% 48.2% 43.2% Three years later 84.6% 67.7% 63.5% 59.8% 59.2% 55.3% Four years later 96.6% 79.3% 72.2% 67.9% 67.6% 64.8% Five years later 106.4% 86.4% 78.5% 74.0% 74.3% 70.4% Six years later 112.4% 91.9% 83.6% 79.5% 78.1% Seven years later 117.3% 96.1% 87.7% 82.4% Eight years later 121.3% 100.0% 90.3% Nine years later 125.2% 102.7% Ten years later 128.0% 1991 1992 1993 1994 1995 Liability for unpaid losses and loss adjustment expenses: As originally estimated $2,129 $2,123 $2,113 $2,187 $3,393 As re-estimated at December 31, 1995 2,040 1,985 1,959 2,080 N/A Liability re-estimated as of: One year later 99.3% 99.9% 98.1% 95.1% Two years later 98.7% 98.2% 92.7% Three years later 97.4% 98.0% 93.5% Four years later 99.2% 95.8% Five years later 98.4% Cumulative deficiency (redundancy) (4.2%) (6.5%) (7.3%) (4.9%) N/A Cumulative paid as of: One year later 26.1% 26.4% 26.7% 25.2% 26.5% Two years later 43.2% 43.0% 43.7% 40.1% Three years later 55.3% 55.4% 53.6% Four years later 64.8% 62.6% Five years later 70.4%
The following table presents the development of the liability (in millions) for losses and LAE, net of reinsurance, including the reserves of American Premier's subsidiaries for periods prior to the Mergers.
1985 1986 1987 1988 1989 1990 Liability for unpaid losses and loss adjustment expenses: As originally estimated $1,605 $1,843 $2,024 $2,209 $2,616 $2,739 As re-estimated at December 31, 1995 2,385 2,258 2,222 2,275 2,579 2,640 Cumulative deficiency (redundancy) 48.6% 22.5% 9.8% 3.0% (1.4%) (3.6%) 1991 1992 1993 1994 1995 Liability for unpaid losses and loss adjustment expenses: As originally estimated $2,793 $2,886 $3,029 $3,267 $3,393 As re-estimated at December 31, 1995 2,648 2,655 2,790 3,110 N/A Cumulative deficiency (redundancy) (5.2%) (8.0%) (7.9%) (4.8%) N/A
These tables do not present accident or policy year development data. Furthermore, in evaluating the re-estimated liability and cumulative deficiency (redundancy), it should be noted that each percentage includes the effects of changes in amounts for prior periods. For example, a deficiency 11 (redundancy) related to losses settled in 1995, but incurred in 1985, would be included in the re-estimated liability and cumulative deficiency (redundancy) percentage for each of the years 1985 through 1994. Conditions and trends that have affected development of the liability in the past may not necessarily exist in the future. Accordingly, it may not be appropriate to extrapolate future redundancies or deficiencies based on this table. The adverse development in earlier years in the tables above was caused partially by the effect of higher than projected inflation on medical, hospitalization, material, repair and replacement costs. Additionally, changes in the legal environment have influenced the development patterns over the past ten years. Two significant changes in the early to mid-1980s were the trend towards an adverse litigious climate and the change from contributory to comparative negligence. The adverse litigious climate is evidenced by an increase in lawsuits and damage awards, changes in judicial interpretation of legal liability and of the scope of policy coverage, and a lengthening of time it takes to settle cases. In addition, a trend has developed in the manner and timeliness of first claim notices. Historically, the first notification of claim came directly from the claimant; in recent years, however, there has been a gradual increase in the number of notifications in the form of direct legal action. Not only has this notification been less timely, it has been more adversarial in nature. The change in rules of negligence governing tort claims has also influenced the loss development trend. During the early to mid-1980s, most states changed from contributory to comparative negligence rules. Under contributory negligence rules, a plaintiff seeking damages is barred from recovering damages for a loss if it can be demonstrated that the plaintiff's own negligence contributed in any way to the cause of the injury. Under comparative negligence rules, a plaintiff's negligence is no longer a bar to recovery. Instead, the degree of plaintiff's negligence is compared to the negligence of any other party. Generally, if the plaintiff's negligence is 50% or less of the cause of the injury, the plaintiff can recover damages, but in an amount reduced by the portion of damage attributable to the plaintiff's own negligence. Many claims which would have been successfully defended under contributory negligence rules now result in an award of damages or a settlement during suit under the comparative negligence rules. The differences between the liability for losses and LAE reported in the annual statements filed with the state insurance departments in accordance with statutory accounting principles ("SAP") and that reported in the accompanying consolidated financial statements in accordance with GAAP at December 31, 1995, are as follows (in millions): Liability reported on a SAP basis $3,394 Additional discounting of GAAP reserves in excess of the statutory limitation for SAP reserves (21) Reserves of foreign operations 20 Reinsurance recoverables 704 Liability reported on a GAAP basis $4,097 Asbestos and Environmental Reserves. The insurance industry typically includes only claims relating to polluted waste sites and asbestos in defining environmental exposures. AFG extends this definition to include claims relating to breast implants, repetitive stress on keyboards, DES (a drug used in pregnancies years ago alleged to cause cancer and birth defects) and other latent injuries ("A&E"). Establishing reserves for A&E claims is subject to uncertainties that are greater than those presented by other types of claims. Factors contributing to those uncertainties include a lack of sufficiently detailed historical data, long reporting delays, uncertainty as to the number and identity of insureds with potential exposure, unresolved legal issues 12 regarding policy coverage, and the extent and timing of any such contractual liability. Courts have reached different and sometimes inconsistent conclusions as to when a loss is deemed to have occurred, what policies provide coverage, what claims are covered, whether there is an insured obligation to defend, how policy limits are determined and other policy provisions. Management believes these issues are not likely to be resolved in the near future. Prior to the fourth quarter of 1994, AFG maintained reserves only on its reported A&E claims; reserves for claims incurred but not reported ("IBNR") were not allocated to A&E claims. Following completion of a detailed analysis in the fourth quarter, AFG allocated a specific portion of its IBNR reserves to A&E claims. Based on known facts, current law, and current industry practices, management believes that its reserves for such claims are appropriate. The following table (in millions) is a progression of reserves for A&E exposures for which AFG has been held liable under general liability policies written years ago where environmental coverage was not intended and, in many cases, was specifically excluded. 1995 1994 1993 Reserves at beginning of year $226.8 $141.5 $142.6 Incurred losses and LAE (a) 25.6 118.3 36.4 Paid losses and LAE (32.1) (33.0) (37.5) Reserves at end of year, net of reinsurance recoverable 220.3 226.8 141.5 Reinsurance recoverable 163.5 155.0 106.9 Gross reserves at end of year $383.8 $381.8 $248.4 (a) Amounts in 1994 reflect an allocation of a specific portion of IBNR reserves to A&E claims as described above. Since the mid-1980's, AFG has also written certain environmental coverages (asbestos abatement and underground storage tank liability) in which the premium charged is intended to provide coverage for the specific environmental exposures inherent in these policies. The business has been profitable since its inception. To date, approximately $174 million of premiums has been written and reserves for unpaid losses and LAE aggregated $48 million at December 31, 1995 (not included in the above table). 13 Annuity Operations General. American Annuity Group ("AAG") is a holding company whose primary asset is the capital stock of GALIC which it acquired from GAI on December 31, 1992. GALIC sells annuities primarily to employees of qualified not-for-profit organizations. GALIC is currently rated "A" (Excellent) by A.M. Best. AAG and its subsidiaries employ approximately 850 persons. The following table (in millions) presents information concerning GALIC. 1995 1994 1993 Statutory Accounting Principles Basis Total Assets $5,414 $5,057 $4,758 Insurance Reserves: Annuities $4,974 $4,655 $4,299 Life 22 21 22 Accident and Health - 1 1 $4,996 $4,677 $4,322 Capital and Surplus $ 273 $ 256 $ 251 Asset Valuation Reserve (a) 90 80 70 Interest Maintenance Reserve (a) 32 28 36 Annuity Receipts: Flexible Premium: First Year $ 42 $ 39 $ 47 Renewal 196 208 223 238 247 270 Single Premium 219 196 130 Total Annuity Receipts $ 457 $ 443 $ 400 Generally Accepted Accounting Principles Basis Total Assets $5,631 $5,044 $4,883 Annuity Benefits Accumulated 4,917 4,596 4,257 Stockholder's Equity 645 449 520 (a) Allocation of surplus. Annuity Products. Annuities are long-term retirement savings plans that benefit from interest accruing on a tax-deferred basis. Employees of qualified not-for-profit organizations are eligible to save for retirement through contributions made on a before tax basis. Contributions are made at the discretion of the participants through payroll deductions or through tax-free "rollovers" of funds. Federal income taxes are not payable on contributions or earnings until amounts are withdrawn. GALIC's principal products are FPDAs and SPDAs. FPDAs are characterized by premium payments that are flexible in amount and timing as determined by the policyholder. SPDAs are issued in exchange for a one-time lump-sum premium payment. Over the last five years, approximately three-fourths of GALIC's SPDA receipts have resulted from rollovers of tax-deferred funds previously maintained by policyholders with other insurers. All annuity products issued by GALIC itself have been fixed rate annuities. With a fixed rate annuity, an interest crediting rate is initially set by the issuer, and thereafter changed from time to time by the issuer based on market conditions, subject to any guaranteed interest crediting rates in the policy. At December 31, 1995, approximately 95% of GALIC's annuity policyholder benefit reserves consisted of fixed rate annuities which offered a minimum interest rate guarantee of 4%. The balance of the liabilities had a minimum guaranteed rate of 3%. In determining the frequency and extent of changes in the crediting rate, GALIC takes into account the profitability of its annuity business and the relative competitive position of its products. 14 A GALIC subsidiary began marketing variable annuities in the fourth quarter of 1995. With a variable annuity, the earnings credited to the policy varies based on the investment results of the underlying investment options chosen by the policyholder. Policyholders may also choose to direct all or a portion of their premiums to various fixed rate options. For these annuity products, all premiums directed to the variable options are placed in funds managed by third party investment advisers. GALIC seeks to maintain a desired spread between the yield on its investment portfolio and the rate it credits to its policies. GALIC accomplishes this by (i) offering crediting rates which it has the option to change, (ii) designing annuity products that encourage persistency and (iii) maintaining an appropriate matching of assets and liabilities. GALIC imposes certain surrender charges and front-end fees during the first five to ten years of a policy to discourage customers from surrendering or withdrawing funds in those early years. Partly due to these features, annuity surrender payments have averaged approximately 8% of related statutory reserves over the past five years. At December 31, 1995, GALIC had over 250,000 annuity policies in force, nearly all of which were individual contracts. Marketing. GALIC markets its tax-deferred annuities principally to employees of educational institutions in the kindergarten through high school segment. GALIC's management believes that this market segment is attractive because of its size and growth potential, and the persistency rate it has demonstrated. In 1995, written premiums from this market segment represented approximately three-fourths of GALIC's total tax-qualified premiums. GALIC distributes its annuity products through over 80 managing general agents ("MGAs") who, in turn, direct approximately 1,000 actively producing independent agents. GALIC has developed its business on the basis of its relationships with MGAs and independent agents primarily through a consistent marketing approach and responsive service. GALIC is licensed to sell its products in all states (except New York) and in the District of Columbia. The following table reflects the geographical distribution of GALIC's annuity premiums in 1995 compared to 1991. State 1995 1991 State 1995 1991 California 19.4% 20.1% New Jersey 4.1% 6.3% Florida 7.8 9.8 Minnesota 3.8 * Massachusetts 6.5 9.1 Connecticut 3.4 6.2 Ohio 6.4 5.1 Illinois 2.9 3.3 Michigan 6.2 9.4 Iowa 2.1 * Washington 5.4 * Rhode Island * 2.8 North Carolina 4.8 2.9 Other 22.6 20.0 Texas 4.6 5.0 100.0% 100.0% _____________ * less than 2% Sales of annuities are affected by many factors, including: (i) competitive rates and products; (ii) the general level of interest rates; (iii) the favorable tax treatment of annuities; (iv) commissions paid to agents; (v) services offered; (vi) ratings from independent insurance rating agencies; (vii) alternative investment products; and (viii) general economic conditions. Acquisition of Laurentian In November 1995, AAG completed the acquisition of Laurentian Capital Corporation, a life insurance holding company, for $151 million. Laurentian's principal insurance subsidiaries are Loyal American Life Insurance Company and Prairie States Life Insurance Company. 15 Loyal offers a variety of life and supplemental health insurance products through payroll deduction plans and credit unions. Loyal's products are marketed with the endorsement or consent of the employer or the credit union management. In 1995 and 1994, Loyal collected $41 million and $43 million, respectively, in life and accident and health premiums. At December 31, 1995, Loyal had total statutory assets of approximately $252 million, reserves for future policy benefits of approximately $201 million, and capital and surplus of approximately $35 million. Prairie offers a variety of life insurance and annuity products to finance pre-arranged funerals. Prairie markets its products with the sponsorship of state associations of funeral directors as well as individual funeral directors. At year-end 1995, Prairie had relationships with more than 2,000 funeral homes nationwide. In 1995 and 1994, Prairie collected $80 million and $53 million, respectively, in life and annuity premiums. At December 31, 1995, Prairie had total statutory assets of approximately $359 million, reserves for future policy benefits of approximately $320 million and capital and surplus of approximately $24 million. In March 1996, AAG changed Prairie's name to American Memorial Life Insurance Company. Competition AAG's insurance companies operate in highly competitive markets. They compete with other insurers and financial institutions based on many factors, including (i) ratings, (ii) financial strength, (iii) reputation, (iv) service to policyholders, (v) product design (including interest rates credited), (vi) commissions and (vii) service to agents. Since policies are marketed and distributed primarily through independent agents, the insurance companies must also compete for agents. Management believes that consistently targeting the same market and emphasizing service to agents and policyholders provides a competitive advantage. More than 100 insurance companies offer tax-deferred annuities. No single insurer dominates the marketplace. Competitors include (i) individual insurers and insurance groups, (ii) mutual funds and (iii) other financial institutions of varying sizes. Some of these are mutual insurance companies possessing competitive advantages in that all of their profits inure to their policyholders, and many of which possess financial resources substantially in excess of those available to AAG's insurance companies. In a broader sense, AAG's insurance companies compete for retirement savings with a variety of financial institutions offering a full range of financial services. Financial institutions have demonstrated a growing interest in marketing investment and savings products other than traditional deposit accounts. In addition, recent judicial and regulatory decisions have expanded powers of financial institutions in this regard. It is too early to predict what impact, if any, these developments will have on AAG's insurance companies. 16 Other Companies AFEI is a holding company with assets consisting primarily of investments in the common stock of AFG, American Annuity and Citicasters. Through subsidiaries, AFC is engaged in a variety of other businesses, including The Golf Center at Kings Island (golf and tennis facility) and Provident Travel Agency, both in the Greater Cincinnati area; commercial real estate operations in Cincinnati (office buildings and The Cincinnatian Hotel), Louisiana (Le Pavillon Hotel), Massachusetts (Chatham Bars Inn), Texas (Driskill Hotel) and apartments in Florida, Kentucky, Louisiana, Minnesota, Oklahoma, Pennsylvania, Texas and Wisconsin. These operations employ approximately 700 full-time employees. In March 1996, American Premier sold its interest in an independent pipeline common carrier of refined petroleum products for approximately $63 million. In June 1994, AFC sold its investment in General Cable common stock to an unaffiliated company for $27.6 million in cash. General Cable was formed in 1992 to hold American Premier's wire and cable and heavy equipment manufacturing businesses. AFC was engaged in the distribution and production of filmed entertainment programming through Spelling Entertainment Group. In 1993, AFC sold its common stock investment in Spelling to Blockbuster Entertainment in exchange for $151 million in Blockbuster securities. In 1993, AFC sold its insurance brokerage operation, American Business Insurance, Inc., to Acordia, Inc., an Indianapolis-based insurance broker for $82 million in cash and Acordia securities. Investment Portfolio General. A breakdown of AFG's December 31, 1995, investment portfolio by business segment follows (excluding investment in equity securities of investee corporations) (in millions).
Total Carrying Value Market P&C Annuity Other Total Value Cash and short-term investments $ 230 $ 169 $145 $ 544 $ 544 Bonds and redeemable preferred stocks 4,261 5,272 5 9,538 9,679 Other stocks, options and warrants 219 33 - 252 252 Loans receivable 148 464 19 631 631(a) Real estate and other investments 140 40 40 220 220(a) $4,998 $5,978 $209 $11,185 $11,326
(a) Carrying value used since market values are not readily available. 17 The following tables present the percentage distribution and yields of AFG's investment portfolio (excluding investment in equity securities of investee corporations) as reflected in its financial statements.
1995 1994 1993 1992 1991 Cash and Short-term Investments 4.9% 2.2% 2.3% 9.3% 15.3% Bonds and Redeemable Preferred Stocks: U.S. Government and Agencies 3.7 4.0 2.8 5.7 5.3 State and Municipal .7 .8 .8 .6 .6 Public Utilities 9.7 9.1 9.3 8.5 10.7 Mortgage-Backed Securities 20.7 21.8 24.7 22.9 20.8 Corporate and Other 46.8 48.6 42.0 33.9 31.8 Redeemable Preferred Stocks 1.0 1.4 1.3 .8 .3 82.6 85.7 80.9 72.4 69.5 Net Unrealized Gains (Losses) on Bonds and Redeemable Preferred Stocks held Available for Sale 2.7 (1.0) 1.8 .8 - 85.3 84.7 82.7 73.2 69.5 Other Stocks, Options and Warrants 2.3 2.7 4.6 2.6 3.2 Loans Receivable 5.6 8.4 8.5 12.9 9.9 Real Estate and Other Investments 1.9 2.0 1.9 2.0 2.1 100.0% 100.0% 100.0% 100.0% 100.0% Yield on Fixed Income Securities: Excluding realized gains and losses 7.9% 8.1% 8.0% 8.8% 9.5% Including realized gains and losses 8.8% 8.1% 8.7% 9.8% 9.0% Yield on Stocks: Excluding realized gains and losses 3.9% 5.1% 4.4% 6.4% 2.2% Including realized gains and losses 8.4% 35.4% 16.9% 15.5% 29.7% Yield on Investments (A): Excluding realized gains and losses 7.9% 8.1% 7.9% 8.7% 9.2% Including realized gains and losses 8.8% 8.8% 9.0% 10.0% 10.0%
(A) Excludes "Real Estate and Other Investments". Fixed Maturity Investments. Unlike most insurance groups which have portfolios that are invested heavily in tax-exempt bonds, AFG's bond portfolio is invested primarily in taxable bonds. The NAIC assigns quality ratings which range from Class 1 (highest quality) to Class 6 (lowest quality). The following table shows AFG's bonds and mandatory redeemable preferred stocks, by NAIC designation (and comparable Standard & Poor's Corporation rating) as of December 31, 1995 (dollars in millions): NAIC Amortized Market Value Rating Comparable S&P Rating Cost Amount % 1 AAA, AA, A $6,137 $6,428 66% 2 BBB 2,556 2,682 28 Total investment grade 8,693 9,110 94 3 BB 326 338 4 4 B 218 223 2 5 CCC, CC, C - 2 * 6 D - 6 * Total non-investment grade 544 569 6 Total $9,237 $9,679 100% _______________ (*)Less than 1% Risks inherent in connection with fixed income securities include loss upon default and market price volatility. Factors which can affect the market price of securities include: creditworthiness, changes in interest rates, the number of market makers and investors, defaults by major issuers of securities and public concern about concentrations in certain types of securities by institutions. 18 AFG's primary investment objective for bonds and mandatory redeemable preferred stocks is to receive interest and dividend income rather than to realize capital gains. AFG invests in bonds and mandatory redeemable preferred stocks that have primarily short-term and intermediate-term maturities. This practice allows flexibility in reacting to fluctuations of interest rates. Equity Investments. AFG's equity investment practice permits concentration of attention on a relatively limited number of companies. Some of the equity investments, because of their size, may not be as readily marketable as the typical small investment position. Alternatively, a large equity position may be attractive to persons seeking to control or influence the policies of a company and AFG's concentration in a relatively small number of companies may permit it to identify investments with above average potential to increase in value. The December 31, 1995, carrying values and market values of AFG's investment in Chiquita and Citicasters, as well as its ownership percentages in these investee corporations, were as follows (dollars in millions): AFG's Ownership Carrying Market Percentage Value Value Chiquita 44% $232.4 $330.0 Citicasters 38% 74.1 178.8 $306.5 $508.8 Chiquita Chiquita is a leading international marketer, producer and distributor of bananas and other quality fresh and processed food products. In addition to bananas, these products include tropical fruit and other fresh produce; fruit and vegetable juices and beverages; processed fruits and vegetables; salads; and edible oil-based consumer products. Sales of bananas accounted for approximately 60% of Chiquita's net sales in each of the last three years. In 1995, Chiquita sold approximately one-half of its total banana volumes in Europe and over 40% of its banana volumes in North America. Chiquita has generally been able to obtain a premium price for its bananas due to its reputation for quality and its innovative marketing techniques. Banana marketing is highly competitive. Selling prices which importers receive for bananas depend on the available supplies of bananas and other fresh fruit in each market and on the relative quality and wholesaler and retailer acceptance of bananas offered by competing importers. Excess supplies may result in increased price competition. Although production of bananas tends to be relatively stable throughout the year, competition comes not only from bananas sold by others, but also from other fresh fruit which may be seasonal in nature. The resulting seasonal variations in demand cause banana pricing to be seasonal. As a result, quarterly results of Chiquita, and therefore AFG's equity in Chiquita's earnings, are subject to significant seasonal variations with stronger quarterly results occurring in the first six months of the calendar year. A significant portion of Chiquita's operations are conducted in foreign countries, and are subject to risks that are inherent in operating in such foreign countries, including government regulation, fluctuations in exchange rates, currency restrictions and other restraints, risks of expropriation and burdensome taxes. In 1993, the European Union ("EU") implemented a new quota restricting the volume of Latin American bananas imported into the EU, which had the effect of decreasing Chiquita's volume and market share in Europe. The quota grants preferred status to producers and importers within the EU and its former colonies, while imposing quotas and tariffs on bananas imported from other sources, including Latin America, which is Chiquita's primary source of fruit. In March 1994, four of the countries which had previously filed actions against the EU banana policy (Costa Rica, Colombia, Nicaragua and Venezuela) reached a settlement with the EU by signing a "Framework 19 Agreement." The Framework Agreement authorizes the imposition of additional restrictive and discriminatory quotas and export licenses on U.S. banana marketing firms, while leaving EU firms exempt. Costa Rica and Colombia implemented this agreement in 1995, significantly increasing Chiquita's cost to export bananas from these sources. In September 1995, based on a finding by the Office of the U.S. Trade Representative ("USTR") that the EU regime unfairly discriminates against U.S. banana marketing firms, the United States, joined by Guatemala, Honduras and Mexico (and, in February 1996, by Ecuador), commenced an international trade challenge against the EU regime using the procedures of the World Trade Organization. In January 1996, the USTR announced that it had found the Framework Agreement export policies of Costa Rica and Colombia to be unfair and further announced that it was not imposing sanctions at that time, pending further consultations with those countries to eliminate harm to U.S. commerce. There can be no assurance as to the outcome of these proceedings or their impact, if any, on the EU quota regime or the Framework Agreement. Citicasters Citicasters owns and operates two network-affiliated television stations, 14 FM radio stations and five AM radio stations. Substantially all of Citicasters' broadcast revenues come from the sale of advertising time to local and national advertisers. Local advertisements are sold by each stations' sales personnel and national spots are sold by independent national sales representatives. Citicasters' AM radio stations offer their listeners a wide range of programs including news, music, discussion, commentary and sports. Citicasters' FM radio stations offer programming more focused on music. Citicasters' television stations receive a significant portion of their programming from their respective networks; the networks sell commercial advertising time within such programming. The competitive position of the stations is directly affected by viewer acceptance of network programs. Citicasters currently has one CBS affiliated television station and one ABC affiliated station. The ABC affiliate is scheduled to switch its affiliation to CBS in June 1996. The non-network programs broadcast by the stations are either produced by the stations or acquired from other sources. Locally originated programs include a wide range of show types such as news, entertainment, sports, public affairs and religious programs. In February 1996, AFG announced that it had entered into an agreement to sell its common stock investment in Citicasters to Jacor Communications, Inc. for $220 million in cash plus warrants to purchase Jacor common stock. Regulation AFG's insurance company subsidiaries are subject to regulation in the jurisdictions where they do business. In general, the insurance laws of the various states establish regulatory agencies with broad administrative powers governing, among other things, premium rates, solvency standards, licensing of insurers, agents and brokers, trade practices, forms of policies, maintenance of specified reserves and capital for the protection of policyholders, deposits of securities for the benefit of policyholders, investment activities and relationships between insurance subsidiaries and their parents and affiliates. Material transactions between insurance subsidiaries and their parents and affiliates generally must be disclosed and prior approval of the applicable insurance regulatory authorities generally is required for any such transaction which may be deemed to be material or extraordinary. In addition, while differing from state to state, these regulations typically restrict the maximum amount of dividends that may be paid by an insurer to its shareholders in any twelve-month period without advance regulatory approval. Such limitations are generally based on earnings or statutory surplus. Under applicable restrictions, the maximum amount of dividends that may be paid by AFG's insurance subsidiaries during 1996 without seeking regulatory clearance is approximately $210 million. 20 Changes in state insurance laws and regulations have the potential to materially affect the revenues and expenses of the insurance operations. The Company is unable to predict whether or when laws or regulations may be adopted or enacted in such states or what the impact of such developments would be on the future operations and revenues of its insurance businesses in such states. In 1994, the California Supreme Court upheld Proposition 103, an insurance reform measure passed by California voters in 1988. In addition to increasing rate regulation, Proposition 103 gives the California Insurance Commissioner power to mandate rate rollbacks for most lines of property and casualty insurance. By its terms, Proposition 103 does not affect workers' compensation insurance. During 1995, GAI finalized a settlement agreement setting its refund obligation at $19 million. Prior to 1995, minimum premium rates for California workers' compensation insurance were determined by the California Commissioner based in part upon recommendations of the Workers' Compensation Insurance Rating Bureau of California. In July 1993, California enacted legislation (the "Reform Legislation") effecting an immediate overall 7% reduction in workers' compensation insurance premium rates and replaced the workers' compensation insurance minimum rate law, effective January 1, 1995, with a procedure permitting insurers to use any rate within 30 days after its filing with the California Commissioner unless the rate is disapproved by the California Commissioner. Between December 1, 1993 and January 1, 1995, when the "open rating" policy went into effect, the California Commissioner ordered additional rate decreases totalling more than 25%. Most states have created insurance guarantee associations to provide for the payment of claims of insurance companies that become insolvent. Annual assessments for AFG's insurance companies have not been material. In addition, many states have created "assigned risk" plans or similar arrangements to provide state mandated minimum levels of automobile liability coverage to drivers whose driving records or other relevant characteristics make it difficult for them to obtain insurance otherwise. Automobile insurers in those states are required to provide such coverage to a proportionate number of those drivers applying as assigned risks. Premium rates for assigned risk business are established by the regulators of the particular state plan and are frequently inadequate in relation to the risks insured, resulting in underwriting losses. Assigned risks accounted for approximately one half of one percent of AFG's net written premiums in 1995. The NAIC is an organization which is comprised of the chief insurance regulator for each of the 50 states and the District of Columbia. In 1990, the NAIC began an accreditation program to ensure that states have adequate procedures in place for effective insurance regulation, especially with respect to financial solvency. The accreditation program requires that a state meet specific minimum standards in over 15 regulatory areas to be considered for accreditation. The accreditation program is an ongoing process and once accredited, a state must enact any new or modified standards approved by the NAIC within two years following adoption. As of December 31, 1995, the District of Columbia and 46 states were accredited including states which regulate AFG's largest insurance subsidiaries. The NAIC model law for Risk Based Capital applies to both life and property and casualty companies. The risk-based capital formulas determine the amount of capital that an insurance company needs to ensure that it has an acceptably low expectation of becoming financially impaired. The model law provides for increasing levels of regulatory intervention as the ratio of an insurer's total adjusted capital and surplus decreases relative to its risk-based capital, culminating with mandatory control of the operations of the insurer by the domiciliary insurance department at the so-called "mandatory control level". The risk-based capital formulas became effective in 1993 for life companies and in 1995 for property and casualty companies. Based on the 1995 results of AFG's insurance companies, all such companies are adequately capitalized. 21 The NAIC has been considering the adoption of a model investment law for several years. The current projection for a new model investment law is 1996, at the earliest. It is not yet determined whether the model investment law would be added to the NAIC accreditation standards so that adoption of the model would be required for the achievement or continuation of any state's accreditation. It is not possible to predict the impact of these activities on AFG's insurance subsidiaries. ITEM 2 Properties Subsidiaries of AFG own several buildings in downtown Cincinnati. AFG and its affiliates occupy about three-fifths of the aggregate 580,000 square feet of commercial and office space. AFG's insurance subsidiaries lease the majority of their office and storage facilities in numerous cities throughout the United States, including GAI's and AAG's home offices in Cincinnati. Two of AAG's subsidiaries own home office buildings in Mobile, Alabama and Rapid City, South Dakota. These companies occupy approximately two-thirds of the 133,000 square feet and lease the remaining space to unaffiliated tenants. ITEM 3 Legal Proceedings AFG and its subsidiaries are involved in various litigation, most of which arose in the ordinary course of business. Except for the following, management believes that none of the litigation meets the threshold for disclosure under this Item. In May 1994, lawsuits were filed against American Premier by USX Corporation ("USX") and its former subsidiary, Bessemer and Lake Erie Railroad Company ("B&LE"), seeking contribution by American Premier, as the successor to the railroad business conducted by Penn Central Transportation Company ("PCTC") prior to 1976, for all or a portion of the approximately $600 million that USX paid in satisfaction of a judgment against B&LE for its participation in an unlawful antitrust conspiracy among certain railroads commencing in the 1950's and continuing through the 1970's. The lawsuits argue that USX's liability for that payment was attributable to PCTC's alleged activities in furtherance of the conspiracy. On October 13, 1994, the U.S. District Court for the Eastern district of Pennsylvania enjoined USX and B&LE from continuing their lawsuits against American Premier, ruling that their claims are barred by the 1978 Consummation Order issued by that Court in PCTC's bankruptcy reorganization proceedings. USX and B&LE appealed the District Court's ruling to the U.S. Court of Appeals for the Third Circuit. On December 13, 1995, the Court of Appeals reversed the U.S. District Court decision. In its opinion, the Court of Appeals only addressed American Premier's procedural argument that the claims of USX could not proceed because they are barred by the Consummation Order. The Third Circuit expressly recognized in its opinion that it was not deciding any of American Premier's defenses on the merits. On January 8, 1996, American Premier filed a petition for rehearing en banc, requesting all of the judges of the Third Circuit to review the three-judge panel's decision. That petition was denied on February 16, 1996. As a result, American Premier will petition the U.S. Supreme Court to review the bankruptcy bar issue. In the event that subsequent reviews do not reinstate the District Court's injunction and USX's lawsuits are eventually permitted to go forward, American Premier and its outside counsel believe that American Premier has substantial defenses to these lawsuits and should not suffer a material loss as a result of this litigation. 22 American Premier is a party or named as a potentially responsible party in a number of proceedings and claims by regulatory agencies and private parties under various environmental protection laws, including the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"), seeking to impose responsibility on American Premier for hazardous waste remediation costs at certain railroad sites formerly owned by PCTC and at certain other sites where hazardous waste allegedly generated by PCTC's railroad operations is present. It is difficult to estimate American Premier's liability for remediation costs at these sites for a number of reasons, including the number and financial resources of other potentially responsible parties involved at a given site, the varying availability of evidence by which to allocate responsibility among such parties, the wide range of costs for possible remediation alternatives, changing technology and the period of time over which these matters develop. Nevertheless, American Premier believes that its previously established loss accruals for potential pre- reorganization environmental liabilities at such sites are adequate to cover the probable amount of such liabilities, based on American Premier's estimates of remediation costs and related expenses at such sites and its estimates of the portions of such costs that will be borne by other parties. Such estimates are based on information currently available to American Premier and are subject to future change as additional information becomes available. Such estimates do not assume any recovery from American Premier's insurance carriers, although American Premier does intend to seek reimbursement from certain insurers for such remediation costs as American Premier incurs. In terms of potential liability to American Premier, the company believes that the most significant such site is the railyard at Paoli, Pennsylvania ("Paoli Yard") which PCTC transferred to Consolidated Rail Corporation ("Conrail") in 1976. A Record of Decision issued by the U.S. Environmental Protection Agency in 1992 presented a final selected remedial action for clean-up of polychlorinated biphenyls ("PCB's") at Paoli Yard having an estimated cost of approximately $28 million. American Premier has accrued its portion of such estimated clean-up costs in its financial statements (in addition to related expenses) but has not accrued the entire amount because it believes it is probable that other parties, including Conrail, will be responsible for substantial percentages of the clean-up costs by virtue of their operation of electrified railroad cars at Paoli Yard that discharged PCB's at higher levels than discharged by cars operated by PCTC. In management's opinion, the outcome of the foregoing environmental claims and contingencies will not, individually or in the aggregate, have a material adverse effect on the financial condition of American Premier. In making this assessment, management has taken into account previously established loss accruals in its financial statements and probable recoveries from third parties. 23 PART II ITEM 5 Market for Registrant's Common Equity and Related Stockholder Matters AFG Common Stock is listed and traded on the New York Stock Exchange ("NYSE") under the symbol AFG. The information presented in the table below represents the high and low sales prices per share reported on the NYSE Composite Tape. For periods prior to the Second Quarter of 1995, the data listed represents data of American Premier, known prior to March 1994 as The Penn Central Corporation. Price Per Share of Common Stock Dividends High Low Paid 1994 First Quarter $33 1/4 $23 3/8 $0.22 Second Quarter 30 23 3/4 0.22 Third Quarter 27 5/8 23 3/4 0.22 Fourth Quarter 27 21 5/8 0.22 1995 First Quarter 26 1/8 22 7/8 0.25 Second Quarter 26 1/4 23 1/4 0.25 Third Quarter 32 1/8 25 1/4 0.25 Fourth Quarter 30 5/8 27 3/4 0.25 There were approximately 19,000 shareholders of record of AFG Common Stock at March 1, 1996. AFG's policy is to pay quarterly dividends on its Common Stock, in amounts determined by its Board of Directors. The Board has declared its intention that AFG pay a dividend of $0.25 per share per quarter. The ability of AFG to pay dividends will be dependent upon, among other things, the availability of dividends and payments under intercompany tax allocation agreements from its insurance company subsidiaries. 24 ITEM 6 Selected Financial Data The following table sets forth certain data for the periods indicated (dollars in millions, except per share data).
1995 1994 1993 1992 1991 Operations Statement Data: Total Revenues $3,630 $2,103 $2,721 $3,929 $5,219 Earnings (Loss) From Continuing Operations Before Income Taxes 247 44 262 (145) 119 Earnings (Loss) From: Continuing Operations 190 19 225 (162) 56 Discontinued Operations - - - - 16 Extraordinary Items 1 (17) (5) - - Cumulative Effect of Accounting Change - - - 85 - Net Earnings (Loss) 191 2 220 (77) 72 Earnings (Loss) Per Common Share (A): Continuing Operations $3.87 ($.24) $7.01 ($6.66) $1.12 Discontinued Operations - - - - .56 Extraordinary Items .01 (.59) (.16) - - Cumulative Effect of Accounting Change - - - 3.02 - Net Earnings (Loss) 3.88 (.83) 6.85 (3.64) 1.68 Cash Dividends Paid Per Share of Common Stock $.75 (B) (B) (B) (B) Ratio of Earnings to Fixed Charges (C) 2.60 1.69 2.62 2.15 1.54 Balance Sheet Data: Total Assets $14,954 $10,593 $10,077 $12,389 $12,057 Long-term Debt: American Financial Corporation (parent only) 311 490 572 557 559 American Premier Underwriters (parent only) 337 - - 650 650 Great American Holding Corp. - 359 199 299 448 Other Subsidiaries 234 258 283 503 451 Capital Subject to Mandatory Redemption - 3 49 28 82 Other Capital 1,440 396 537 280 262
(A) The weighted average number of shares used for periods prior to April 1995, is based upon the 28.3 million shares issued in exchange for AFC shares in the Mergers discussed in Note A. (B) Prior to the Mergers, AFC's common stock was privately held by members of the Lindner family. American Premier declared and paid cash dividends per share of $.25 prior to the Mergers in 1995; it also declared cash dividends of $.91 in 1994, $.85 in 1993, $.81 in 1992 and $.71 in 1991. AFG declared two quarterly $.25 per share dividends subsequent to the Mergers in 1995. (C) Fixed charges are computed on a "total enterprise" basis. For purposes of calculating the ratios, "earnings" have been computed by adding to pretax earnings (excluding discontinued operations) the fixed charges and the minority interest in earnings of subsidiaries having fixed charges and deducting (adding) the undistributed equity in earnings (losses) of investees. Fixed charges include interest (excluding interest on annuity benefits), amortization of debt discount and expense, preferred dividend requirements of subsidiaries and a portion of rental expense deemed to be representative of the interest factor. 25 ITEM 7 Management's Discussion and Analysis of Financial Condition and Results of Operations GENERAL Following is a discussion and analysis of the financial statements and other statistical data that management believes will enhance the understanding of AFG's financial condition and results of operations. This discussion should be read in conjunction with the financial statements beginning on page F-1. As discussed in Note A to the Financial Statements, the Mergers of AFC and American Premier in April 1995 were accounted for as a reverse acquisition whereby AFC was deemed to have acquired American Premier. Financial statements for periods prior to the Mergers are those of AFC. The operations of American Premier are included in AFG's financial statements from the date of acquisition. LIQUIDITY AND CAPITAL RESOURCES Ratios Since the Mergers to the end of the year, nearly $850 million of AFC and American Premier debt was retired or replaced with lower cost debt, resulting in a net reduction of aggregate debt by approximately half. Consequently, AFG's debt to total capital ratio at the holding company level improved from nearly 60% at the date of the Mergers to approximately 30% at December 31, 1995. These debt reductions and replacements will also reduce AFG's interest expense by approximately $75 million annually. AFG's ratio of earnings to fixed charges on a total enterprise basis was 2.60, 1.69 and 2.62 for the years ended December 31, 1995, 1994 and 1993, respectively. Assuming the Mergers and related transactions occurred at the beginning of each of these periods, these ratios would have been 2.93, 2.07 and 3.09, respectively. The National Association of Insurance Commissioners' model law for risk based capital ("RBC") applies to both life and property and casualty companies. RBC formulas determine the amount of capital that an insurance company needs to ensure that it has an acceptable expectation of not becoming financially impaired. At December 31, 1995, the capital ratios of all AFG insurance companies substantially exceeded the RBC requirements. Sources of Funds AFG and its subsidiaries, AFC and American Premier, are organized as holding companies with almost all of their operations being conducted by subsidiaries. These parent corporations, however, have continuing cash needs for administrative expenses, the payment of principal and interest on borrowings, and shareholder dividends. AFG, AFC and American Premier rely primarily on dividends and tax payments from their subsidiaries for funds to meet their obligations. Management believes AFG has sufficient resources to meet the liquidity requirements of AFG, AFC and American Premier through operations in the short-term and long-term future. If funds generated from operations, including dividends from subsidiaries, are insufficient to meet fixed charges in any period, these companies would be required to generate cash through borrowings, sales of securities or other assets, or similar transactions. Prior to the Mergers, American Premier had substantial cash and short-term investments at the parent company level. Subsequent to the Mergers, AFC entered into a credit agreement with American Premier. At December 31, 1995, AFC had borrowed $623 million under this agreement which it used for debt retirements, capital contributions to subsidiaries, and other 26 corporate purposes. In addition, AFG and American Premier entered into a reciprocal credit agreement under which these companies will make funds available to each other for general corporate purposes. Bank credit lines at several subsidiary holding companies provide ample liquidity which can be used to obtain funds for the operating subsidiaries or, if necessary, for the parent companies, AFC, American Premier and ultimately AFG. Agreements with the banks generally run for three to seven years and are renewed before maturity. While it is highly unlikely that all such amounts would ever be borrowed at one time, up to $470 million is available under these bank facilities. In the past, funds have been borrowed under certain of these bank facilities and used for working capital, capital infusions into subsidiaries, and to retire other issues of short-term or high-rate debt. Also, while little was drawn on the bank lines at December 31, 1995, AFG believes it may be prudent and advisable to borrow up to $200 million of bank debt in the normal course and use the proceeds to retire additional amounts of public or privately held fixed rate debt over the next year or two. Dividend payments from subsidiaries have been very important to the liquidity and cash flow of the individual holding companies in the past. However, the combination of (i) strong capital at AFG's insurance subsidiaries (and the related decreased likelihood of a need for investment in those companies), (ii) the reductions of debt at the holding companies (and the related decrease in ongoing cash needs for interest and principal payments), (iii) AFG's ability to obtain financing in capital markets, as well as (iv) the sales of Buckeye and Citicasters, should lessen the reliance on such dividend payments in the future. For statutory accounting purposes, equity securities are generally carried at market value. At December 31, 1995, AFG's insurance companies owned publicly traded equity securities with a market value of $1.3 billion, including equity securities of AFG affiliates (including subsidiaries) of $1.0 billion. Since significant amounts of these are concentrated in a relatively small number of companies, decreases in the market prices could adversely affect the insurance group's capital, potentially impacting the amount of dividends available or necessitating a capital contribution. Conversely, increases in the market prices could have a favorable impact on the group's dividend-paying capability. Following the Mergers, AFC and American Premier will each continue to file separate consolidated tax returns. Under tax allocation agreements with AFC, its 80%-owned U.S. subsidiaries generally compute tax provisions as if filing separate returns based on book taxable income computed in accordance with generally accepted accounting principles. American Premier has tax allocation agreements with its U.S. insurance subsidiaries whereby such subsidiaries compute tax provisions based on taxable income in accordance with statutory accounting principles. In each case, the resulting provision (or credit) is currently payable to (or receivable from) AFC or American Premier. American Premier's federal income tax loss carryforward is available to offset taxable income and, as a result, American Premier's requirement to pay federal income tax for 1996 is substantially eliminated. Uncertainties Two lawsuits were filed in 1994 against American Premier by USX Corporation ("USX") and a former USX subsidiary. The lawsuits seek contribution from American Premier for all or a portion of a $600 million final antitrust judgment entered against a USX subsidiary in 1994. The lawsuits argue that USX's liability for that judgment is attributable to the alleged activities of American Premier's predecessor in an unlawful antitrust conspiracy among certain railroad companies. American Premier and its outside counsel believe that American Premier has substantial defenses and should not suffer a material loss as a result of this litigation. 27 Great American's liability for unpaid losses and loss adjustment expenses includes amounts for various liability coverages related to environmental and hazardous product claims. The insurance industry typically includes only claims relating to polluted waste sites and asbestos in defining environmental exposures, whereas Great American extends this definition to include claims relating to breast implants, repetitive stress on keyboards, DES (a drug used in pregnancies years ago alleged to cause cancer and birth defects), and other latent injuries. At December 31, 1995, Great American had recorded $220 million (net of reinsurance recoverables of $164 million) for environmental pollution and hazardous products claims on policies written many years ago where, in most cases, coverage was never intended. Due to inconsistent court decisions on many coverage issues and the difficulty in determining standards acceptable for cleaning up pollution sites, significant uncertainties exist which are not likely to be resolved in the near future. AFG's subsidiaries are parties in a number of proceedings relating to former operations. See Note L to the financial statements. While the results of all such uncertainties cannot be predicted, based upon its knowledge of the facts, circumstances and applicable laws, management believes that sufficient reserves have been provided. Investments Approximately two-thirds of AFG's consolidated assets are invested in marketable securities. A diverse portfolio of bonds and redeemable preferred stocks accounts for 95% of these securities. AFG attempts to optimize investment income while building the value of its portfolio, placing emphasis upon long-term performance. AFG's goal is to maximize return on an ongoing basis rather than focusing on short-term performance. Fixed income investment funds are generally invested in securities with short-term and intermediate-term maturities with an objective of optimizing total return while allowing flexibility to react to changes in market conditions. At December 31, 1995, the average life of AFG's bonds and redeemable preferred stocks was approximately 6 years. Approximately 94% of the bonds and redeemable preferred stocks held by AFG were rated "investment grade" (credit rating of AAA to BBB) by nationally recognized rating agencies at December 31, 1995. Investment grade securities generally bear lower yields and lower degrees of risk than those that are unrated and non-investment grade. Management believes that the high quality investment portfolio should generate a stable and predictable investment return. Investments in mortgage-backed securities ("MBSs"), represented approximately one-fourth of AFG's bonds and redeemable preferred stocks at December 31, 1995. AFG invests primarily in MBSs which have a reduced risk of prepayment. Interest only (I/Os), principal only (P/Os) and other "high risk" MBSs represented less than two percent of AFG's total mortgage-backed securities portfolio. In addition, the majority of MBSs held by AFG were purchased at a discount. Management believes that the structure and discounted nature of the MBSs will minimize the effect of prepayments on earnings over the anticipated life of the MBS portfolio. More than 90% of AFG's MBSs are rated "AAA" with substantially all being of investment grade quality. The majority are collateralized by GNMA, FNMA and FHLMC single-family residential pass-through certificates. The market in which these securities trade is highly liquid. Aside from interest rate risk, AFG does not believe a material risk (relative to earnings or liquidity) is inherent in holding such investments. Because most income of the property and casualty insurance subsidiaries is currently sheltered from income taxes, non- taxable municipal bonds represent only a small portion (less than 1%) of the portfolio. AFG's equity securities are concentrated in a relatively limited number of major positions. This approach allows management to more closely monitor the companies and industries in which they operate. 28 The realization of capital gains, primarily through sales of equity securities, was an integral part of AFG's investment program. Individual securities are sold creating gains or losses as market opportunities exist. Pretax capital gains recognized upon disposition of securities, including investees, during the past five years have been: 1995 - $84 million; 1994 - $50 million; 1993 - $165 million; 1992 - $104 million and 1991 - $38 million. At December 31, 1995, the net unrealized gain on AFG's bonds and redeemable preferred stocks was $442 million; the net unrealized gain on equity securities was $115 million. RESULTS OF OPERATIONS - THREE YEARS ENDED DECEMBER 31, 1995 General As previously noted, financial statements for periods prior to the April 1995, Mergers are those of AFC. The operations of American Premier are included in AFG's financial statements from the date of acquisition. AFC had accounted for American Premier as a subsidiary in 1992 and the first quarter of 1993 and as an investee from the second quarter of 1993 through the first quarter of 1995. Accordingly, current year income statement components are not comparable to prior years and are not indicative of future periods. Pretax earnings were $247 million in 1995 compared to $44 million in 1994 and $262 million in 1993. In addition to the earnings contribution from the Mergers, results for 1995 include $84 million in pretax gains on the sale of securities. Results for 1994 include AFC's share ($28 million) of American Premier's loss on the sale of General Cable securities, Great American's $19 million charge relating to a rate rollback liability in California and a $35 million charge related to payments under AFC's Book Value Incentive Plan. These items were partially offset by a $42 million decrease in interest expense. Results for 1993 include (i) $155 million in gains from the sales of AFC's insurance agency operations, Spelling Entertainment Group and 4.5 million shares of American Premier and additional proceeds received on the 1990 sale of the NSA Group to American Premier, and (ii) AFC's share ($52 million) of a tax benefit recorded by American Premier in the second, third and fourth quarters of 1993. These items were partially offset by a write-off of debt discount and expenses of $24 million. Property and Casualty Insurance - Underwriting AFG manages and operates its property and casualty business as three major sectors. The nonstandard automobile insurance companies (the "NSA Group") insure risks not typically accepted for standard automobile coverage because of the applicant's driving record, type of vehicle, age or other criteria. The specialty lines are a diversified group of over twenty-five business lines that offer a wide variety of specialty insurance products. Some of the more significant areas are California workers' compensation, executive liability, inland and ocean marine, U.S.-based operations of Japanese companies, agricultural- related coverages, excess and surplus lines and fidelity and surety bonds. The commercial and personal lines provide coverages in commercial multi-peril, workers' compensation, umbrella and commercial automobile, standard private passenger automobile and homeowners insurance. To understand the overall profitability of particular lines, timing of claims payments and the related impact of investment income must be considered. Certain "short-tail" lines of business (primarily property coverages) have quick loss payouts which reduce the time funds are held, thereby limiting investment income earned thereon. On the other hand, "long-tail" lines of business (primarily liability coverages and workers' compensation) have payouts that are either structured over many years or take many years to settle, thereby significantly increasing investment income earned on related premiums received. 29 Underwriting profitability is measured by the combined ratio which is a sum of the ratio of underwriting expenses, losses, and loss adjustment expenses to premiums. When the combined ratio is under 100%, underwriting results are generally considered profitable; when the ratio is over 100%, underwriting results are generally considered unprofitable. The combined ratio does not reflect investment income, other income or federal income taxes. While AFG desires and seeks to earn an underwriting profit on all of its business, it is not always possible to do so. As a result, the company attempts to expand in the most profitable areas and control growth or even reduce its involvement in the least profitable ones. Comparisons made in the following discussion of AFG's insurance operations include American Premier's insurance operations even though they were not consolidated in the financial statements throughout the periods prior to the Mergers. Results for AFG's property and casualty insurance subsidiaries are as follows (dollars in millions): 1995 1994 1993 Net Written Premiums (GAAP) NSA Group $1,277 $1,186 $ 916 Specialty Operations 1,097 1,250 1,079 Commercial and Personal Operations 717 683 666 Other Lines 1 5 6 Aggregate $3,092 $3,124 $2,667 Combined Ratios (GAAP) NSA Group 105.2% 100.0% 97.2% Specialty Operations 94.8 97.2 96.1 Commercial and Personal Operations 99.1 98.9 101.0 Aggregate 101.2 99.4 99.8 In 1995, underwriting results of AFG's insurance operations significantly outperformed the industry average for the tenth consecutive year. AFG's insurance operations have been able to exceed the industry's results by focusing on highly specialized niche products, supplemented by commercial lines coverages and personal automobile products. NSA Group The NSA Group attributes its premium growth in recent years primarily to entry into additional states, increased market penetration in its existing states, overall growth in the nonstandard market, premium rate increases and the purchase of Leader National. The increase in the combined ratio for 1995 compared with 1994 was due primarily to inadequate rate levels in certain markets and weather-related losses principally from hailstorms in Texas. These factors were partially offset by a reduction in the underwriting expense ratio due largely to cost control measures. Underwriting conditions in the private passenger automobile insurance marketplace in 1994 were affected by competitive conditions and the pricing policies of insurers. Improving economic conditions contributed to increased driving activity resulting in an increase in the frequency of accidents and severity of claims. These trends caused a deterioration in the NSA Group's underwriting profit margins during 1994. These factors were partially offset by underwriting profit from the NSA Group's entry into certain markets, as well as improved underwriting margins in several markets where the book of business matured and a greater portion of new premium was derived from renewal policies. Premium rate increases were implemented in several states during 1994 and 1995. Rate increases implemented in various states during 1995 averaged approximately 10% across the NSA Group's entire book of business. The higher rate levels and competitive pressures in the nonstandard automobile insurance industry adversely impacted premium growth during 1995. 30 Specialty Operations Net written premiums for the specialty operations declined 12% during 1995 due primarily to a decrease in the California workers' compensation writings, partially offset by increases in other specialty niche lines (primarily crop hail, excess and surplus and executive liability). The decline in California workers' compensation premiums reflects (i) extremely competitive pricing in the marketplace as a result of the repeal of the California workers' compensation minimum rate law effective January 1, 1995 and (ii) the impact of mandatory premium rate reductions which took effect a year earlier. The combined ratio of the specialty operations in 1995 reflects improved results experienced in the crop hail and farm lines as well as coverages of U.S. operations of Japanese companies. The 1995 combined ratio also includes losses resulting from participation in a voluntary pool from which AFG withdrew in 1995. Commercial and Personal Operations Net written premiums for the commercial and personal operations increased 5% in 1995 due primarily to increased writing of workers' compensation and commercial umbrella insurance. The profitability of both of these lines improved in 1995. Workers' compensation improved due to favorable rate action by rating bureaus, health care cost containment programs, marketing emphasis on profitable states and implementation of a Drug-Free Workplace program. Commercial umbrella results improved due to a focus on low hazard risks and more favorable pricing in the higher umbrella layers. In addition, cost control measures reduced the underwriting expense ratio. These improved results were offset by an increase in the combined ratio of the personal lines operations due primarily to weather-related losses, start-up costs from its direct-to-consumer operation and deteriorating automobile loss experience for accident years 1994 and 1995. Investment Income Changes in investment income reflect fluctuations in market rates and changes in average invested assets. 1995 compared to 1994 AFC's investment income increased $50 million (9%) from 1994 due to an increase in the average amount of investments held. For the period following the Mergers, investment income includes $117 million attributable to American Premier. 1994 compared to 1993 Excluding American Premier, which was included as a subsidiary for the first three months of 1993, investment income increased $20 million (4%) due to an increase in average investments held. Investee Corporations Equity in net earnings of investee corporations (companies in which AFG owns a significant portion of the voting stock) represents AFG's proportionate share of the investees' earnings and losses. 1995 compared to 1994 AFG's equity in net earnings of investee corporations increased $32 million in 1995. Chiquita reported a $105 million improvement in operating income primarily due to net gains from the sale of non-core assets, cost reductions in its core business and higher banana prices outside the European Union. 1994 compared to 1993 AFG's equity in net earnings (losses) of investee corporations in 1994 includes AFC's share ($28 million) of American Premier's loss on the sale of General Cable securities and its share ($52 million) of American Premier's tax benefit in 1993. Chiquita's loss before extraordinary items was comparable in 1994 and 1993 as improvements in Meat Division operations and banana pricing were offset by charges and losses relating to farm closings and banana cultivation write-downs in Honduras and a substantial reduction of Chiquita's Japanese banana trading operations. 31 Gains on Sales of Investees The gain on sale of investees in 1994 represents a pretax gain on the sale of General Cable common stock. The gains on sales of investees in 1993 include (i) a pretax gain of $52 million on the sale of Spelling Entertainment and (ii) a pretax gain of $28 million on the public sale by AFEI of 4.5 million shares of American Premier common stock. Gains on Sales of Subsidiaries The gains on sales of subsidiaries in 1993 include pretax gains of (i) $44 million from the sale of American Business Insurance, Inc. and (ii) $31 million representing an adjustment on AFC's 1990 sale of the nonstandard automobile insurance group to American Premier. Sales of Other Products and Services Sales of other products and services represents American Premier's revenues from systems and software engineering services and the manufacture and supply of industrial products and services during the first quarter of 1993. Annuity Benefits For GAAP financial reporting purposes, annuity receipts are generally accounted for as interest- bearing deposits ("annuity benefits accumulated") rather than as revenues. Under these contracts, policyholders' funds are credited with interest on a tax-deferred basis until withdrawn by the policyholder. Annuity benefits represent primarily interest related to annuity policyholders' funds held. The rate at which GALIC credits interest on annuity policyholders' funds is subject to change based on management's judgment of market conditions. Annuity receipts totaled approximately $460 million in 1995, $440 million in 1994 and $400 million in 1993. Annuity receipts have increased in 1995, 1994 and 1993 due to sales of newly introduced single premium products and, in 1995, the development of new distribution channels. Annuity surrender payments have averaged approximately 8% of statutory reserves over the past three years. Annuity benefits increased $13 million (5%) in 1995 and $13 million (6%) in 1994 primarily due to an increase in average annuity benefits accumulated. Interest on Borrowed Money Changes in interest expense result from fluctuations in market rates as well as changes in borrowings. AFG has generally financed its borrowings on a long-term basis which has resulted in higher current costs. 1995 compared to 1994 Excluding $29 million attributable to American Premier, interest expense decreased by $22 million (19%) due primarily to the repayments of borrowings by AFC and certain subsidiaries and the AFC debt exchange in 1994. 1994 compared to 1993 Excluding $17 million attributable to American Premier in 1993, AFG's interest expense decreased $25 million (18%) in 1994 due to (i) the issuance of $204 million of 9-3/4% debentures in exchange for higher rate debt, (ii) the repurchase of $79 million principal amount of debentures and (iii) repayments of bank borrowings in 1993. Other Operating and General Expenses Operating and general expenses included the following charges (in millions): 1995 1994 1993 Minority interest $33 $ 9 $35 Allowance for bad debts - 18 10 Proposition 103 - 19 - Writeoff of debt discount and issue costs - - 24 Relocation expenses - - 8 32 Allowance for bad debts includes charges for possible losses on agents' balances, reinsurance recoverables and other receivables. Beginning in April 1995, minority interest includes AFC's quarterly preferred dividend requirement of $6.3 million. Relocation expenses represent the estimated costs of moving GALIC's operations from Los Angeles to Cincinnati. Income Taxes See Note J to the Financial Statements for an analysis of other items affecting AFG's effective tax rate. 33 ITEM 8 Financial Statements and Supplementary Data Page Reports of Independent Auditors F-1 Consolidated Balance Sheet: December 31, 1995 and 1994 F-4 Consolidated Statement of Earnings: Years ended December 31, 1995, 1994 and 1993 F-5 Consolidated Statement of Cash Flows: Years ended December 31, 1995, 1994 and 1993 F-6 Notes to Consolidated Financial Statements F-7 "Selected Quarterly Financial Data" has been included in Note O to the Consolidated Financial Statements. ITEM 9 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure AFG filed a report on Form 8-K on August 29, 1995, reporting a change in its independent accountants. The report is incorporated herein by reference. 34 PART III The information required by the following Items will be included in AFG's definitive Proxy Statement for the 1996 Annual Meeting of Shareholders which will be filed with the Securities and Exchange Commission within 120 days after the end of Registrant's fiscal year and is incorporated herin by reference. ITEM 10 Directors and Executive Officers of the Registrant ITEM 11 Executive Compensation ITEM 12 Security Ownership of Certain Beneficial Owners and Management ITEM 13 Certain Relationships and Related Transactions 35 REPORTS OF INDEPENDENT AUDITORS Board of Directors American Financial Group, Inc. We have audited the accompanying consolidated balance sheets of American Financial Group, Inc. and subsidiaries as of December 31, 1995 and 1994, and the related consolidated statements of earnings and cash flows for each of the three years in the period ended December 31, 1995. Our audits also included the financial statement schedules listed in the Index at Item 14(a). These financial statements and schedules are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and schedules based on our audits. The financial statements of American Premier Underwriters, Inc. (1994 and 1993) and General Cable Corporation (1993) have been audited by other auditors whose reports have been furnished to us; insofar as our opinion on the consolidated financial statements and schedules relates to data included for those corporations, it is based solely on the reports of other auditors. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits and the reports of other auditors provide a reasonable basis for our opinion. In our opinion, based on our audits and the reports of other auditors, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of American Financial Group, Inc. and subsidiaries at December 31, 1995 and 1994, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 1995, in conformity with generally accepted accounting principles. Also, in our opinion, the related financial statement schedules, when considered in relation to the basic financial statements taken as a whole, present fairly in all material respects the information set forth therein. ERNST & YOUNG LLP Cincinnati, Ohio March 15, 1996 F-1 REPORT OF AMERICAN PREMIER'S INDEPENDENT AUDITORS American Premier Underwriters, Inc. We have audited the financial statements and the financial statement schedules of American Premier Underwriters, Inc. and Consolidated Subsidiaries listed in the Index to Financial Statements and Financial Statement Schedules of American Premier Underwriters, Inc.'s Form 10-K for the year ended December 31, 1994 (not presented separately herein). These financial statements and the financial statement schedules are the responsibility of the Company's management. Our responsibility is to express an opinion on the financial statements and financial statement schedules based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, such financial statements present fairly, in all material respects, the financial position of American Premier Underwriters, Inc. and Consolidated Subsidiaries at December 31, 1994 and the results of its operations and its cash flows for each of the two years in the period ended December 31, 1994 in conformity with generally accepted accounting principles. Also, in our opinion, such financial statement schedules, when considered in relation to the basic financial statements taken as a whole, present fairly in all material respects the information shown therein. DELOITTE & TOUCHE LLP Cincinnati, Ohio February 15, 1995 (March 23, 1995 with respect to the acquisition of American Financial Corporation as discussed in Note B to American Premier's financial statements) F-2 REPORT OF GENERAL CABLE'S INDEPENDENT AUDITORS General Cable Corporation: We have audited the consolidated financial statements and related schedules of General Cable Corporation and subsidiaries listed in Item 14(a) of the Annual Report on Form 10-K of General Cable Corporation for the year ended December 31, 1993 (not presented separately herein). These consolidated financial statements and related schedules are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements and related schedules based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of General Cable Corporation and subsidiaries at December 31, 1993 and the results of their operations and their cash flows for the year then ended in conformity with generally accepted accounting principles. Also, in our opinion, such consolidated financial statement schedules, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly in all material respects the information shown therein. DELOITTE & TOUCHE Cincinnati, Ohio February 18, 1994 F-3 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (Dollars In Thousands)
December 31, 1995 1994 Assets Cash and short-term investments $ 544,408 $ 171,335 Investments: Bonds and redeemable preferred stocks: Held to maturity - at amortized cost (market - $3,729,300 and $4,336,700) 3,588,943 4,629,633 Available for sale - at market (amortized cost - $5,648,060 and $1,938,853) 5,949,260 1,862,653 Other stocks - principally at market (cost - $136,944 and $137,106) 252,244 208,706 Investment in investee corporations 306,545 832,637 Loans receivable 631,408 641,964 Real estate and other investments 220,135 154,262 10,948,535 8,329,855 Recoverables from reinsurers and prepaid reinsurance premiums 923,080 902,063 Agents' balances and premiums receivable 703,274 363,156 Deferred acquisition costs 419,919 231,343 Other receivables 270,263 197,119 Deferred tax asset 200,392 42,600 Assets held in separate accounts 238,524 - Prepaid expenses, deferred charges and other assets 391,339 179,314 Cost in excess of net assets acquired 314,136 175,866 $14,953,870 $10,592,651 Liabilities and Capital Unpaid losses and loss adjustment expenses $ 4,096,703 $ 2,916,985 Unearned premiums 1,294,054 824,691 Annuity benefits accumulated 5,051,959 4,618,108 Life, accident and health benefit reserves 538,274 19,879 Long-term debt: Direct obligations of AFG Parent Company - - Obligations of AFG subsidiaries: American Financial Corporation (parent only) 311,202 490,065 American Premier Underwriters (parent only) 337,334 - Great American Holding Corporation - 359,185 American Annuity Group 167,734 183,242 Other subsidiaries 65,793 74,255 Liabilities related to separate accounts 238,524 - Accounts payable, accrued expenses and other liabilities 1,097,766 601,872 Minority interest 314,390 105,506 13,513,733 10,193,788 AFC Mandatory Redeemable Preferred Stock (at redemption value) - 2,880 Other AFC Preferred Stock (redemption value - $278,719) - 168,484 AFC Common Stock without par value - 904 Common Stock, $1 par value - 200,000,000 shares authorized - 60,139,303 shares outstanding 60,139 - Capital surplus 741,355 - Retained earnings 387,143 223,095 Net unrealized gain on marketable securities, net of deferred income taxes 251,500 3,500 $14,953,870 $10,592,651
See notes to consolidated financial statements. F-4 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF EARNINGS (In Thousands, Except Per Share Data)
Year ended December 31, 1995 1994 1993 Income: Property and casualty insurance premiums $2,648,703 $1,378,628 $1,494,796 Investment income 750,640 582,931 601,900 Realized gains on sales of securities 84,028 48,342 82,265 Equity in net earnings (losses) of investee corporations 15,237 (16,573) 69,862 Gains on sales of investee corporations 335 1,694 83,211 Gains on sales of subsidiaries - - 75,309 Sales of other products and services - - 152,100 Other income 130,666 107,758 161,260 3,629,609 2,102,780 2,720,703 Costs and Expenses: Property and casualty insurance: Losses and loss adjustment expenses 1,977,395 986,996 1,064,108 Commissions and other underwriting expenses 707,340 428,590 467,293 Annuity benefits 254,650 241,811 228,609 Interest charges on borrowed money 122,568 115,162 157,219 Cost of sales - - 134,900 Book Value Incentive Plan - 34,740 991 Other operating and general expenses 320,737 251,913 405,598 3,382,690 2,059,212 2,458,718 Earnings before income taxes and extraordinary items 246,919 43,568 261,985 Provision for income taxes 56,489 24,650 37,296 Earnings before extraordinary items 190,430 18,918 224,689 Extraordinary items, net of income taxes 817 (16,818) (4,559) Net Earnings $ 191,247 $ 2,100 $ 220,130 Preferred dividend requirement of predecessor company 6,349 25,709 26,122 Net earnings (loss) available to Common Shares $ 184,898 $ (23,609) $ 194,008 Earnings (loss) per Common Share: Before extraordinary items $3.87 ($.24) $7.01 Extraordinary items .01 (.59) (.16) Net earnings (loss) $3.88 ($.83) $6.85 Average number of Common Shares 47,620 28,324 28,324
See notes to consolidated financial statements. F-5 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOWS (In Thousands)
Year ended December 31, 1995 1994 1993 Operating Activities: Net earnings $ 191,247 $ 2,100 $ 220,130 Adjustments: Extraordinary (gains) losses from retirement of debt (817) 16,818 4,559 Depreciation and amortization 47,760 30,729 52,117 Annuity benefits 254,650 241,811 228,609 Equity in net (earnings) losses of investees (15,237) 16,573 (69,862) Changes in reserves on assets 2,302 17,094 11,440 Realized gains on investing activities (84,995) (59,609) (242,529) Writeoff of debt discount and issue costs - - 30,054 Decrease (increase) in reinsurance and other receivables 23,192 (223,113) (238,166) Increase in other assets (11,503) (96,596) (90,022) Increase in insurance claims and reserves 137,180 345,542 241,704 Increase (decrease) in other liabilities (247,938) 67,799 50,479 Increase in minority interest 7,877 6,773 37,057 Dividends from investees 9,568 21,567 25,575 Other, net (673) (1,488) (37,062) 312,613 386,000 224,083 Investing Activities: Purchases of and additional investments in: Fixed maturity investments (2,378,427) (1,726,318) (3,062,435) Equity securities (1,034) (7,315) (20,224) Investees and subsidiaries (68,591) (29,306) (27,578) Real estate, property and equipment (42,579) (27,185) (41,762) Maturities and redemptions of fixed maturity investments 309,581 420,945 757,473 Sales of: Fixed maturity investments 2,310,837 694,947 1,498,432 Equity securities 17,379 127,181 221,467 Investees and subsidiaries - 27,621 255,517 Real estate, property and equipment 27,759 6,151 65,782 Cash and short-term investments of acquired (former) subsidiaries 392,100 - (310,225) Decrease (increase) in other investments (11,466) (5,571) 1,435 555,559 (518,850) (662,118) Financing Activities: Annuity receipts 457,525 442,703 400,141 Annuity payments (412,854) (321,038) (337,878) Additional long-term borrowings 337,076 244,311 338,010 Reductions of long-term debt (1,061,187) (193,481) (601,040) Issuances of common stock 211,557 - - Repurchases of preferred stock (17) (6,738) (2,643) Cash dividends paid (27,199) (29,522) (28,034) (495,099) 136,235 (231,444) Net Increase (Decrease) in Cash and Short-term Investments 373,073 3,385 (669,479) Cash and short-term investments at beginning of period 171,335 167,950 837,429 Cash and short-term investments at end of period $ 544,408 $ 171,335 $ 167,950
See notes to consolidated financial statements. F-6 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS INDEX TO NOTES A. Mergers I. Capital Stock B. Accounting Policies J. Income Taxes C. Acquisitions and Sales of Subsidiaries K. Extraordinary Items and Investees L. Commitments and Contingencies D. Segments of Operations M. Benefit Plans E. Investments N. Transactions with Affiliates F. Investment in Investee Corporations O. Quarterly Operating Results G. Cost in Excess of Net Assets Acquired P. Insurance H. Long-Term Debt Q. Additional Information R. Subsequent Event A. Mergers American Premier Group, Inc. was formed in December 1994 for the purpose of acquiring American Financial Corporation ("AFC") and American Premier Underwriters, Inc. ("American Premier"). In Mergers completed on April 3, 1995, American Premier Group issued 71.4 million shares of its Common Stock in exchange for all of the outstanding common stock of AFC and American Premier. The 18.7 million shares held by AFC and its subsidiaries are accounted for herein as retired. In June 1995, American Premier Group, Inc. changed its name to American Financial Group, Inc. ("AFG"), to better reflect its core property and casualty insurance and annuity businesses. For financial reporting purposes, because the former shareholders of AFC owned more than 50% of AFG following the Mergers, the Mergers were accounted for as a reverse acquisition whereby AFC was deemed to have acquired American Premier. Financial statements for periods prior to the Mergers are those of AFC. The operations of American Premier are included in AFG's financial statements from the date of the Mergers. The valuation of American Premier's net assets was determined based on the fair market value of the AFG shares issued to shareholders other than AFC and was allocated to American Premier's assets and liabilities based on their fair values at the date of acquisition. The following unaudited pro forma data is presented as if the Mergers occurred on January 1 of each year (in millions, except per share data). 1995 1994 Revenues $4,049 $3,832 Earnings before Extraordinary Items 216 59 Extraordinary Items 1 (17) Net Earnings 217 42 Earnings Per Share $ 4.04 $ .79 F-7 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED B. Accounting Policies Basis of Presentation The consolidated financial statements include the accounts of AFG and its subsidiaries. Mergers and changes in ownership levels of subsidiaries and investees have resulted in certain differences in the financial statements and have affected comparability between years. Certain reclassifications have been made to prior years to conform to the current year's presentation. All significant intercompany balances and transactions have been eliminated. All acquisitions have been treated as purchases. The results of operations of companies since their formation or acquisition are included in the consolidated financial statements. The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Changes in circumstances could cause actual results to differ materially from those estimates. AFG's ownership of subsidiaries and significant investees with publicly traded common shares at December 31, was as follows: 1995 1994 1993 American Annuity Group, Inc. ("AAG") 81% 80% 80% American Financial Enterprises, Inc. ("AFEI") 83% 83% 83% American Premier Underwriters, Inc. (a) 42% 41% Chiquita Brands International, Inc. 44% 46% 46% Citicasters Inc. (formerly GACC) 38% 37% 20% General Cable Corporation - (b) 45% (a) Became a 100%-owned subsidiary on April 3, 1995. (b) Sold in June 1994. Investments Debt securities are classified as "held to maturity" and reported at amortized cost if AFG has the positive intent and ability to hold them to maturity. Debt and equity securities are classified as "available for sale" and reported at fair value with unrealized gains and losses reported as a separate component of shareholders' equity if the debt or equity securities are not classified as held to maturity or bought and held principally for selling in the near term. Only in certain limited circumstances, such as significant issuer credit deterioration or if required by insurance or other regulators, may a company change its intent to hold a certain security to maturity without calling into question its intent to hold other debt securities to maturity in the future. In accordance with guidance issued by the Financial Accounting Standards Board in November 1995, AFG reassessed the classifications of its investments and transferred fixed maturity securities with an amortized cost of approximately $2.8 billion to "available for sale." This "one-time" reclassification resulted in an increase of $167 million in carrying value of fixed maturity investments and an increase of $109 million in shareholders' equity. The transfer had no effect on net earnings. Premiums and discounts on mortgage-backed securities are amortized over their expected average lives using the interest method. Gains or losses on sales of securities are recognized at the time of disposition with the amount of gain or loss determined on the specific identification basis. When a decline in the value of a specific investment is considered to be other than temporary, a provision for impairment is charged to earnings and the carrying value of that investment is reduced. Short-term investments are carried at cost; loans receivable are stated primarily at the aggregate unpaid balance. F-8 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED Investment in Investee Corporations Investments in securities of 20%- to 50%-owned companies are carried at cost, adjusted for AFG's proportionate share of their undistributed earnings or losses. Investments in less than 20%-owned companies are accounted for by the equity method when, in the opinion of management, AFG can exercise significant influence over operating and financial policies of the investee. Cost in Excess of Net Assets Acquired The excess of cost of subsidiaries and investees over AFG's equity in the underlying net assets ("goodwill") is being amortized over 40 years. The excess of AFG's equity in the net assets of other subsidiaries and investees over its cost of acquiring these companies ("negative goodwill") is allocated to AFG's basis in these companies' fixed assets, goodwill and other long-term assets and is amortized on a 10- to 40-year basis. Insurance As discussed under "Reinsurance" below, unpaid losses and loss adjustment expenses and unearned premiums have not been reduced for reinsurance recoverable. Reinsurance In the normal course of business, AFG's insurance subsidiaries cede reinsurance to other companies to diversify risk and limit maximum loss arising from large claims. To the extent that any reinsuring companies are unable to meet obligations under the agreements covering reinsurance ceded, AFG's insurance subsidiaries would remain liable. Amounts recoverable from reinsurers are estimated in a manner consistent with the claim liability associated with the reinsurance policies. AFG's insurance subsidiaries report as assets (a) the estimated reinsurance recoverable on unpaid losses, including an estimate for losses incurred but not reported, and (b) amounts paid to reinsurers applicable to the unexpired terms of policies in force. AFG's insurance subsidiaries also assume reinsurance from other companies. Income on reinsurance assumed is recognized based on reports received from ceding reinsurers. Deferred Acquisition Costs Policy acquisition costs (principally commissions, premium taxes and other underwriting expenses) related to the production of new business are deferred ("DPAC"). For the property and casualty companies, the deferral of acquisition costs is limited based upon their recoverability without any consideration for anticipated investment income. DPAC is charged against income ratably over the terms of the related policies. For the annuity companies, DPAC is amortized, with interest, in relation to the present value of expected gross profits on the policies. Unpaid Losses and Loss Adjustment Expenses The net liabilities stated for unpaid claims and for expenses of investigation and adjustment of unpaid claims are based upon (a) the accumulation of case estimates for losses reported prior to the close of the accounting period on the direct business written; (b) estimates received from ceding reinsurers and insurance pools and associations; (c) estimates of unreported losses based on past experience; (d) estimates based on experience of expenses for investigating and adjusting claims and (e) the current state of the law and coverage litigation. These liabilities are subject to the impact of changes in claim amounts and frequency and other factors. In spite of the variability inherent in such estimates, management believes that the liabilities for unpaid losses and loss adjustment expenses are adequate. Changes in estimates of the liabilities for losses and loss adjustment expenses are reflected in the Statement of Earnings in the period in which determined. F-9 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED Premium Recognition Premiums are earned over the terms of the policies on a pro rata basis. Unearned premiums represent that portion of premiums written which is applicable to the unexpired terms of policies in force. On reinsurance assumed from other insurance companies or written through various underwriting organizations, unearned premiums are based on reports received from such companies and organizations. Policyholder Dividends Dividends payable to policyholders are included in "Accounts payable, accrued expenses and other liabilities" and represent estimates of amounts payable on participating policies which share in favorable underwriting results. The estimate is accrued during the period in which the related premium is earned. Changes in estimates are included in income in the period determined. Policyholder dividends do not become legal liabilities unless and until declared by the boards of directors of the insurance companies. Annuity Benefits Accumulated Annuity receipts and benefit payments are generally recorded as increases or decreases in "annuity benefits accumulated" rather than as revenue and expense. Increases in this liability for interest credited are charged to expense and decreases for surrender charges are credited to other income. Life, Accident and Health Benefits Reserves Liabilities for future policy benefits under traditional ordinary life, accident and health policies are computed using a net level premium method. Computations are based on anticipated investment yields (primarily 7%), mortality, morbidity and surrenders and include provisions for unfavorable deviations. Reserves are modified as necessary to reflect actual experience and developing trends. Assets Held In and Liabilities Related to Separate Accounts Investment annuity deposits and related liabilities represent deposits maintained by several banks under a previously offered tax deferred annuity program. AAG receives an annual fee from each bank for sponsoring the program; depositors can elect to purchase an annuity from AAG with funds in their account. Income Taxes AFC and American Premier file consolidated federal income tax returns which include all 80%-owned U.S. subsidiaries, except for certain life insurance subsidiaries. Because voting rights aggregating 21% were extended to holders of AFC Series F and G Preferred Stock in connection with the Mergers, AFC continues to file a separate consolidated return. AFG (parent) is included in American Premier's consolidated return. Deferred income taxes are calculated using the liability method. Under this method, deferred income tax assets and liabilities are determined based on differences between financial reporting and tax bases and are measured using enacted tax rates. Deferred tax assets are recognized if it is more likely than not that a benefit will be realized. Benefit Plans AFG provides retirement benefits, through contributory and noncontributory defined contribution plans, to qualified employees of participating companies. Contributions to benefit plans are charged against earnings in the year for which they are declared. Both AFC and American Premier have Employee Stock Ownership Retirement Plans ("ESORP") which are noncontributory, qualified plans invested in securities of AFG and affiliates for the benefit of their employees. F-10 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED AFG and many of its subsidiaries provide health care and life insurance benefits to eligible retirees. AFG also provides postemployment benefits to former or inactive employees (primarily those on disability) who were not deemed retired under other company plans. The projected future cost of providing these benefits is expensed over the period the employees qualify for such benefits. Under AFG's stock option plan, options are granted to officers, directors and key employees at exercise prices equal to the fair value of the shares at the dates of grant. No compensation expense is recognized for stock option grants. In connection with the Mergers, full vesting was granted to holders of units under AFC's Book Value Incentive Plan and the plan was terminated. Cash payments, which were made in April to holders of the units, were accrued at December 31, 1994. Debt Discount and Premium Debt discount, premium and expenses are amortized over the lives of respective borrowings, generally on the interest method. Minority Interest For balance sheet purposes, minority interest represents the interests of noncontrolling shareholders in AFG subsidiaries and includes AFC preferred stock for periods subsequent to the Mergers. For income statement purposes, minority interest (included in "Other operating and general expenses") represents those shareholders' interest in the earnings of AFG subsidiaries and includes AFC preferred dividends following the Mergers. Earnings Per Share Earnings per share are calculated on the basis of the weighted average number of shares of common stock outstanding during the period and the dilutive effect, if material, of assumed conversion of common stock equivalents (stock options and convertible preferred stock). The weighted average number of shares used for periods prior to April 1995, is based upon the 28.3 million shares issued in exchange for AFC shares in the Mergers discussed in Note A. Statement of Cash Flows For cash flow purposes, "investing activities" are defined as making and collecting loans and acquiring and disposing of debt or equity instruments and property and equipment. "Financing activities" include obtaining resources from owners and providing them with a return on their investments, borrowing money and repaying amounts borrowed. Annuity receipts, benefits and withdrawals are also reflected as financing activities. All other activities are considered "operating". Short-term investments having original maturities of three months or less when purchased are considered to be cash equivalents for purposes of the financial statements. Fair Value of Financial Instruments Methods and assumptions used in estimating fair values are described in Note Q to the financial statements. These fair values represent point-in-time estimates of value that might not be particularly relevant in predicting AFG's future earnings or cash flows. C. Acquisitions and Sales of Subsidiaries and Investees General Cable In June 1994, AFC sold its investment in General Cable common stock to an unaffiliated company for $27.6 million in cash. AFC realized a $1.7 million pretax gain on the sale (excluding its share of American Premier's loss on its sale of General Cable securities). F-11 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED American Business Insurance In 1993, AFC sold its insurance brokerage operation, American Business Insurance, Inc., to Acordia, Inc., an Indianapolis-based insurance broker, for cash and Acordia common stock and warrants. AFC recognized a pretax gain of approximately $44 million on the sale. American Premier In 1993, AFEI, whose assets consisted primarily of investments in American Premier, General Cable and AAG, sold 4.5 million shares of American Premier common stock in a secondary public offering. AFC recognized a pretax gain of $28.3 million, before minority interest, on the sale, including recognition of a portion of previously deferred gains related to sales of assets to American Premier from AFC subsidiaries. In anticipation of the reduction of AFC's ownership of American Premier below 50%, AFC ceased accounting for it as a subsidiary and began accounting for it as an investee in April 1993. In 1993, American Premier paid AFC $52.8 million (including $12.8 million in interest) representing an adjustment on the 1990 sale of AFC's nonstandard automobile group to American Premier. AFC recorded an additional pretax gain of $31.4 million on this transaction after deferring $21.4 million based on its then current ownership of American Premier. Citicasters In December 1993, GACC completed a plan of reorganization under which AFC received approximately 20% of new common stock in exchange for its previous holdings of GACC stock and debt. In connection with the plan, AFC also invested an additional $7.5 million in GACC common stock and debt securities. In June 1994, AFEI purchased approximately 10% of Citicasters common stock from a third party for $23.9 million in cash. In February 1996, Citicasters entered into a merger agreement with Jacor Communications, Inc. providing for the acquisition of Citicasters by Jacor. Under the agreement, AFG and its subsidiaries would receive approximately $220 million in cash plus warrants to buy approximately 1.5 million shares of Jacor common stock at $28 per share. AFG expects to realize a pretax gain of approximately $150 million on the sale. Consummation of the transaction is subject to regulatory approvals, and certain adjustments to the price will be made if the transaction does not close by September 30, 1996. Spelling In 1993, AFC sold its common stock investment in Spelling to Blockbuster Entertainment in exchange for Blockbuster common stock and warrants. AFC realized a $52 million pretax gain on the sale. D. Segments of Operations AFG operates its property and casualty insurance business in three major segments: nonstandard automobile, specialty lines and commercial and personal lines. AFG's annuity business sells tax-deferred annuities principally to employees of primary and secondary educational institutions and hospitals. These insurance businesses operate throughout the United States. AFG also owns significant portions of the voting equity securities of certain companies (investee corporations - see Note F). F-12 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED The following tables (in thousands) show AFG's assets, revenues and operating profit (loss) by significant business segment. Capital expenditures, depreciation and amortization are not significant. Operating profit (loss) represents total revenues less operating expenses. Goodwill and its amortization have been allocated to the various segments to which they apply. General corporate assets and expenses have not been identified or allocated by segment.
1995 1994 1993 Assets Property and casualty insurance (a) $ 7,443,115 $ 4,576,591 $ 4,192,908 Annuities 6,600,377 5,078,928 4,898,419 Other 603,833 104,495 86,361 14,647,325 9,760,014 9,177,688 Investment in investee corporations 306,545 832,637 899,800 $14,953,870 $10,592,651 $10,077,488 Revenues (b) Property and casualty insurance: Premiums earned: Nonstandard automobile $ 954,210 $ 24,974 $ 175,046 Specialty lines 995,528 698,365 651,836 Commercial and personal lines 697,512 648,222 661,910 Other lines (c) 1,453 7,067 6,004 2,648,703 1,378,628 1,494,796 Investment and other income 465,998 314,731 481,548 3,114,701 1,693,359 1,976,344 Annuities (d) 444,082 378,010 395,871 Other 55,589 47,984 278,626 3,614,372 2,119,353 2,650,841 Equity in net earnings (losses) of investee corporations 15,237 (16,573) 69,862 $ 3,629,609 $ 2,102,780 $ 2,720,703 Operating Profit (Loss) Property and casualty insurance: Underwriting: Nonstandard automobile ($ 60,316) ($ 3,080) $ 4,498 Specialty lines 50,690 (12,598) 18,994 Commercial and personal lines 5,315 7,087 (6,493) Other lines (c) (31,721) (24,914) (51,100) (36,032) (33,505) (34,101) Investment and other income 370,579 199,292 321,701 334,547 165,787 287,600 Annuities 79,579 58,748 63,388 Other (e) (182,444) (164,394) (158,865) 231,682 60,141 192,123 Equity in net earnings (losses) of investee corporations 15,237 (16,573) 69,862 $ 246,919 $ 43,568 $ 261,985
(a) Not allocable to segments. (b) Revenues include sales of products and services as well as other income earned by the respective segments. (c) Includes discontinued insurance lines. (d) Represents primarily investment income and realized gains. (e) Includes holding company expenses. F-13 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED E. Investments Bonds, redeemable preferred stocks and other stocks at December 31, consisted of the following (in millions):
1995 Held to Maturity Amortized Market Gross Unrealized Cost Value Gains Losses Bonds and redeemable preferred stocks: United States Government and government agencies and authorities $ - $ - $ - $ - States, municipalities and political subdivisions 55.0 56.6 1.7 (.1) Foreign government 13.1 12.8 1.0 (1.3) Public utilities 528.8 545.3 17.7 (1.2) Mortgage-backed securities 945.7 980.3 35.3 (.7) All other corporate 2,042.1 2,129.8 87.8 (.1) Redeemable preferred stocks 4.2 4.5 .3 - $3,588.9 $3,729.3 $143.8 $ (3.4) 1995 Available for Sale Amortized Market Gross Unrealized Cost Value Gains Losses Bonds and redeemable preferred stocks: United States Government and government agencies and authorities $ 413.9 $ 431.3 $ 17.5 ($ .1) States, municipalities and political subdivisions 20.6 20.3 .3 (.6) Foreign government 87.5 89.9 2.4 - Public utilities 561.3 591.0 32.3 (2.6) Mortgage-backed securities 1,373.2 1,407.8 40.7 (6.1) All other corporate 3,087.1 3,304.3 219.8 (2.6) Redeemable preferred stocks 104.5 104.7 1.9 (1.7) $5,648.1 $5,949.3 $314.9 ($13.7) Other stocks $ 136.9 $ 252.2 $115.9 ($ .6) 1994 Held to Maturity Amortized Market Gross Unrealized Cost Value Gains Losses Bonds and redeemable preferred stocks: United States Government and government agencies and authorities $ - $ - $ - $ - States, municipalities and political subdivisions 23.4 23.2 .7 ( .9) Foreign government 16.0 14.0 - (2.0) Public utilities 614.9 566.4 .8 (49.3) Mortgage-backed securities 952.7 872.3 .1 (80.5) All other corporate 2,917.7 2,761.6 5.7 (161.8) Redeemable preferred stocks 104.9 99.2 .4 (6.1) $4,629.6 $4,336.7 $ 7.7 ($300.6) 1994 Available for Sale Amortized Market Gross Unrealized Cost Value Gains Losses Bonds and redeemable preferred stocks: United States Government and government agencies and authorities $ 306.9 $ 293.0 $ .4 ($14.3) States, municipalities and political subdivisions 36.8 36.3 1.4 (1.9) Foreign government 44.0 42.4 .1 (1.7) Public utilities 84.1 79.3 .2 (5.0) Mortgage-backed securities 721.4 671.5 .6 (50.5) All other corporate 745.7 740.2 2.9 (8.4) Redeemable preferred stocks - - - - $1,938.9 $1,862.7 $ 5.6 ($81.8) Other stocks $ 137.1 $ 208.7 $ 72.0 ($ .4)
The table below sets forth the scheduled maturities of bonds and redeemable preferred stocks based on carrying value as of December 31, 1995. Data based on market value is generally the same. Mortgage-backed securities had an average life of approximately 7 years at December 31, 1995. Held to Available Maturity Maturity for Sale One year or less 2% 1% After one year through five years 30 19 After five years through ten years 38 42 After ten years 4 14 74 76 Mortgage-backed securities 26 24 100% 100% F-14 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED Certain risks are inherent in connection with fixed maturity securities, including loss upon default, price volatility in reaction to changes in interest rates and general market factors and risks associated with reinvestment of proceeds due to prepayments or redemptions in a period of declining interest rates. Realized gains (losses) and changes in unrealized appreciation (depreciation) on fixed maturity and equity security investments are summarized as follows (in thousands): Fixed Equity Tax Maturities Securities Effects Total 1995 Realized $ 77,963 $ 6,065 ($ 13,915) $ 70,113 Change in Unrealized 810,690 43,400 (287,896) 566,194 1994 Realized (1,107) 49,449 30 48,372 Change in Unrealized (673,001) (60,500) 256,725 (476,776) 1993 Realized 52,915 29,350 (12,348) 69,917 Change in Unrealized 125,112 83,700 (73,084) 135,728 Transactions in fixed maturity investments included in the Statement of Cash Flows consisted of the following (in millions): 1995 Held to Available Maturity for Sale Total Purchases $774.8 $1,603.6 $2,378.4 Maturities and redemptions 176.3 133.3 309.6 Sales 12.9 2,297.9 2,310.8 Gross Gains 1.9 88.0 89.9 Gross Losses (2.3) (9.6) (11.9) 1994 Held to Available Maturity for Sale Total Purchases $1,090.0 $636.3 $1,726.3 Maturities and redemptions 216.0 204.9 420.9 Sales 8.0 686.9 694.9 Gross Gains 3.3 9.4 12.7 Gross Losses (2.5) (11.3) (13.8) Securities classified as "held to maturity" having an amortized cost of $14.7 million and $8.7 million were sold for a loss of $1.8 million and $712,000 in 1995 and 1994, respectively, due to significant deterioration in the issuers' creditworthiness. Gross gains of $69.4 million and gross losses of $16.5 were realized on sales of fixed maturity investments during 1993. F-15 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED F. Investment in Investee Corporations Investment in investee corporations represents AFG's ownership of securities of certain companies. All of the companies named in the following table are subject to the rules and regulations of the SEC. Market value of the investments was approximately $509 million and $890 million at December 31, 1995 and 1994, respectively. AFG's investment (and common stock ownership percentage) and equity in net earnings and losses of investees are stated below (dollars in thousands):
Investment (Ownership %) Equity in Net Earnings (Losses) 12/31/95 12/31/94 1995 1994 1993 Chiquita (a) $232,466 (44%) $237,015(46%) $ 3,628 ($26,670) ($24,038) Citicasters (b) 74,079 (38%) 69,695(37%) 4,702 8,950 - American Premier(c) - 525,927(42%) 6,907 1,147 91,700 Other - - - - 2,200 $306,545 $832,637 $15,237 ($16,573) $69,862
(a) Excludes AFG's share of Chiquita's extraordinary losses on prepayment of debt in 1995 and 1994. (b) AFC resumed equity accounting for its investment in GACC following GACC's reorganization at the end of 1993. See Note C concerning agreement to sell Citicasters. (c) Accounted for as an investee beginning April 1, 1993; became a 100%-owned subsidiary on April 3, 1995. Chiquita is a leading international marketer, processor and producer of quality food products. Citicasters owns and operates radio and television stations in major markets throughout the country. Included in AFG's consolidated retained earnings at December 31, 1995, was approximately $35 million applicable to equity in undistributed net earnings of investees. F-16 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED Summarized financial information for AFG's investees at December 31, 1995, is shown below (in millions). See "Investee Corporations" in Management's Discussion and Analysis. Chiquita Brands International, Inc. (*) 1995 1994 1993 Current Assets $ 877 $ 804 Non-current Assets 1,747 1,970 Current Liabilities 510 574 Non-current Liabilities 1,442 1,555 Shareholders' Equity 672 645 Net Sales of Continuing Operations $2,566 $2,506 $2,533 Operating Income 176 71 104 Income (Loss) from Continuing Operations 28 (84) (51) Discontinued Operations (11) 35 - Extraordinary Item (8) (23) - Net Income (Loss) 9 (72) (51) (*) Amounts for 1994 and 1993 were reclassified by Chiquita in 1995 to reflect discontinued operations.
Citicasters Inc. 1995 1994 1993 Contracts, Broadcasting Licenses and Other Intangibles $313 $275 Other Assets 103 128 Long-term Debt 132 122 Shareholders' Equity 160 151 Net Revenues $136 $197 $205 Operating Income 37 52 40 Earnings (Loss) before Extraordinary Items 14 63 (67) Extraordinary Items - - 408(**) Net Earnings 14 63 341
(**) Extraordinary items include a $414 million gain on debt discharged in the reorganization of Citicasters' predecessor. F-17 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED G. Cost in Excess of Net Assets Acquired At December 31, 1995 and 1994, accumulated amortization of the excess of cost over net assets of purchased subsidiaries amounted to approximately $110 million and $100 million, respectively. Amortization expense was $9.2 million in 1995, $6.1 million in 1994 and $15.0 million in 1993. H. Long-Term Debt Long-term debt consisted of the following at December 31, (in thousands):
1995 1994 American Financial Corporation (Parent Company): 9-3/4% Debentures due April 2004, less discount of $1,249 and $0 (imputed rate - 9.8%) $302,510 $203,759 12% Debentures due September 1999 - 120,463 10% Debentures due October 1999 - 89,620 12-1/4% Debentures due September 2003 - 51,556 Other, less discount of $0 and $456 8,692 24,667 $311,202 $490,065 American Premier Underwriters, Inc. (Parent Company): 9-3/4% Subordinated Notes due August 1999, including premium of $4,403 (imputed rate - 8.8%) $161,531 10-5/8% Subordinated Notes due April 2000, including premium of $7,210 (imputed rate - 8.8%) 120,222 10-7/8% Subordinated Notes due May 2011, including premium of $5,082 (imputed rate - 9.6%) 55,581 Notes payable to banks by Pennsylvania Company - $337,334 Great American Holding Corporation: Notes payable to banks $ - $160,000 11% Notes due 1998, less discount of $737 - 149,263 Floating Rate Notes due 1995, less discount of $78 - 49,922 $ - $359,185 American Annuity Group, Inc.: 11-1/8% Senior Subordinated Notes due February 2003 $101,443 $103,868 9-1/2% Senior Notes due August 2001 41,490 43,990 Notes payable to banks due September 1999 20,500 30,000 Other 4,301 5,384 $167,734 $183,242 Other Subsidiaries: Notes payable secured by real estate $ 53,066 $ 45,354 Notes payable to banks due December 1997 - 16,000 Other 12,727 12,901 $ 65,793 $ 74,255
F-18 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED At December 31, 1995, sinking fund and other scheduled principal payments on debt for the subsequent five years were as follows (in thousands): American AFC Premier (Parent) (Parent) Other Total 1996 $ - $ - $ 2,538 $ 2,538 1997 5,910 - 2,498 8,408 1998 - - 2,761 2,761 1999 - 157,128 22,848 179,976 2000 - 113,012 8,608 121,620 Debentures purchased in excess of scheduled payments may be applied to satisfy any sinking fund requirement. The scheduled principal payments shown above assume that debentures purchased are applied to the earliest scheduled retirements. Great American Holding Corporation ("GAHC"), a wholly-owned subsidiary of AFC, and Pennsylvania Company ("Pennco"), a wholly-owned subsidiary of American Premier, have revolving loan agreements with groups of banks under which they can borrow up to $300 million and $75 million, respectively. Borrowings bear interest at floating rates based on prime or LIBOR and are collateralized by certain stock of operating subsidiaries. Each facility is guaranteed by the respective immediate parent company. AAG and AFEI have revolving credit agreements with banks under which they can borrow up to $75 million and $20 million, respectively. Borrowings bear interest at floating rates based on prime or LIBOR and are collateralized. Following the Mergers, American Premier agreed to lend up to $675 million to AFC under a line of credit, and subsequently advanced funds which, along with other funds available, were used by AFC to redeem $279 million of its various debentures, repay $187 million of GAHC's bank debt, and redeem $200 million of GAHC's Notes. Also during 1995, AFC sold an aggregate of $100 million of its 9-3/4% debentures due in 2004 for cash. In a 1994 exchange offer, AFC issued $204 million of its 9- 3/4% debentures for a like amount of its various other debenture issues. The related unamortized original issue discount and debt issue costs ($24.3 million) were written off in 1993. In connection with the offer, all of AFC's 13-1/2% debentures not tendered for exchange were redeemed for $63.2 million in cash. As the result of the Mergers and a subsequent ratings downgrade, holders of American Premier's Notes had the right to "Put" their Notes to American Premier at face amount. Approximately $44 million of the Notes were tendered under the Put Right. In addition, American Premier repurchased $136 million of the Notes for $142.7 million in cash. In connection with its acquisition of GALIC in 1992, AAG borrowed $230 million from several banks. In 1993, AAG sold $225 million of Notes to the public and repaid the bank loans. During 1994, AAG repurchased $77.1 million of the Notes in exchange for $69 million in cash plus 810,000 shares of its common stock. During 1995, AAG repurchased $4.9 million of the Notes for $5.0 million in cash. F-19 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED In the first two months of 1996, AFC repurchased $48.3 million of its debentures for $52.4 million; American Premier repurchased $28.7 million of its Notes for $31.1 million; and AAG repurchased $22.1 million of its Notes for $24.1 million. Cash interest payments of $137 million, $115 million and $133 million were made on long-term debt in 1995, 1994 and 1993, respectively. I. Capital Stock In connection with the Mergers discussed in Note A, AFG issued 51.3 million shares (net of 18.7 million shares held by AFC and its subsidiaries, which are shown herein as retired) of Common Stock on April 3, 1995. During 1995, AFG sold 7.4 million newly issued shares of its Common Stock for an aggregate of $202.8 million cash in connection with (i) exercises of Stock Options, (ii) issuances under AFG's new Dividend Reinvestment Plan and its Employee Stock Purchase Plan, and (iii) sales to the AFC ESORP and in a public offering. At December 31, 1995, there were 60,139,303 shares of AFG Common Stock outstanding or issuable, including 1,373,081 shares held by American Premier for issuance to certain creditors and other claimants pursuant to a plan of reorganization relating to American Premier's predecessor. AFG is authorized to issue 12.5 million shares of Voting Preferred Stock and 12.5 million shares of Nonvoting Preferred Stock, each without par value. At December 31, 1995, AFG had 212,698 shares of convertible preferred stock outstanding with a stated value of $469,000 (included in Capital Surplus, net of related notes receivable). At that date, there were 446,799 shares of AFG Common Stock reserved for issuance upon conversion of the Preferred Stock. See Note R - Subsequent Event. F-20 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED At December 31, 1995, there were 6.0 million shares of AFG Common Stock reserved for issuance upon exercise of stock options. Options become exercisable at the rate of 20% per year commencing one year after grant; those granted to non- employee directors of AFG are generally fully exercisable upon grant. All options expire ten years after the date of grant. Stock option data for AFG is as follows: Option Price Shares per share Outstanding at April 3, 1995 2,931,948 $17.24 to $31.38 Granted 2,142,681 23.97 to 30.06 Exercised (883,974) 17.24 to 28.19 Terminated (250,669) 19.20 to 28.19 Outstanding at December 31, 1995 3,939,986 17.24 to 31.38 Exercisable at December 31, 1995 1,395,175 Available for grant at December 31, 1995 2,107,988 A progression of AFG's Shareholders' Equity is as follows (dollars in thousands):
Common Stock Common and Capital Retained Shares(*) Surplus Earnings Unrealized Balance at December 31, 1992 18,971,217 $ 904 $ 42,402 $ 68,100 Net earnings - - 220,130 - Dividends on: Preferred Stock - - (26,137) - Common Stock - - (1,897) - Increase in capital subject to put option - - (23,652) - Change in unrealized - - - 88,800 Balance at December 31, 1993 18,971,217 904 210,846 156,900 Net earnings - - 2,100 - Purchase of Preferred Stock - - (56) - Dividends on: Preferred Stock - - (25,728) - Common Stock - - (3,794) - Decrease in capital subject to put option - - 7,225 - Transfer from capital subject to put option - - 32,502 - Change in unrealized - - - (153,400) Balance at December 31, 1994 18,971,217 904 223,095 3,500 Dividends on AFC Preferred Stock - - (191) - Exercise of AFC stock options 762,500 8,721 - - Restatement of AFC equity in terms of AFG Common Stock 8,590,159 - - - Shares issued in Mergers to holders of APU Common Stock 24,376,667 588,492 - - Net earnings - - 191,247 - Change in unrealized - - - 248,000 Dividends on Common Stock - - (27,008) - Shares issued: Exercise of stock options 883,974 18,875 - - Dividend reinvestment plan 200,381 5,859 - - Employee stock purchase plan 32,972 918 - - Public offering 4,600,000 127,180 - - Sale to AFC ESORP 1,703,000 50,004 - - Employee gift shares 19,050 494 - - Shares repurchased (617) (17) - - Change in foreign currency translation - 64 - - Balance at December 31, 1995 60,139,303 $801,494 $387,143 $251,500
(*) Prior to the Mergers, Carl H. Lindner and certain members of the Lindner family owned all of the outstanding common stock of AFC. F-21 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED Under a 1983 agreement, certain members of the Lindner family (the "Group") had the right to "put" to AFC their shares of AFC common stock or options at a defined value. In anticipation of the extinguishment of the Group's rights due to the Mergers, the allocation of capital equal to that value ($32.5 million) was reclassified to Retained Earnings at December 31, 1994. AFC Mandatory Redeemable Preferred Stock At December 31, 1994, there were 274,242 shares of $10.50 par value Series E Preferred Stock outstanding. These shares were retired, at par, in December 1995. During 1994, AFC redeemed all 150,212 outstanding shares of Series I Preferred Stock and 230,469 shares of Series E Preferred Stock for approximately $6.6 million. During 1993, AFC purchased 75,106 shares of Series I Preferred Stock for approximately $2.1 million. Other AFC Preferred Stock Subsequent to the Mergers, AFC's Preferred Stock is included in "Minority interest." At December 31, 1995, AFC's Preferred Stock was voting, cumulative, and consisted of the following: Series F, $1 par value; annual dividends per share $1.80; 10% may be retired at AFC's option at $20 per share in 1996; 13,744,754 shares (stated value - $167.9 million) outstanding at December 31, 1995 and 1994. Series G, $1 par value; annual dividends per share $1.05; may be retired at AFC's option at $10.50 per share; 364,158 shares (stated value - $600,000) outstanding at December 31, 1995 and 1994. In 1994, AFC purchased 8,500 shares of Series F Preferred Stock from a subsidiary's profit sharing plan for $159,000. F-22 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED J. Income Taxes The following is a reconciliation of income taxes at the statutory rate of 35% and income taxes as shown in the Statement of Earnings (in thousands):
1995 1994 1993 Earnings before income taxes and extraordinary items $246,919 $43,568 $261,985 Extraordinary items before income taxes 536 (17,192) (4,559) Adjusted earnings before income taxes $247,455 $26,376 $257,426 Income taxes at statutory rate $ 86,609 $ 9,232 $ 90,099 Effect of: Losses (utilized) not utilized (40,292) 19,267 (59,141) Dividends received deduction (7,823) (8,528) (8,336) Minority interest 11,673 2,998 12,082 Amortization of intangibles 3,015 1,987 2,658 Tax exempt interest (897) (689) (659) Foreign income taxes 359 6 76 State income taxes 81 149 820 Other 3,483 (146) (303) Total provision 56,208 24,276 37,296 Amounts applicable to extraordinary items 281 374 - Provision for income taxes as shown on the Statement of Earnings $ 56,489 $24,650 $ 37,296 Adjusted earnings (loss) before income taxes consisted of the following (in thousands): 1995 1994 1993 Subject to tax in: United States $250,423 $28,422 $255,682 Foreign jurisdictions (2,968) (2,046) 1,744 $247,455 $26,376 $257,426 The total income tax provision consists of (in thousands): 1995 1994 1993 Current taxes (credits): Federal $38,512 $21,028 $43,592 Foreign (1,213) - 503 State 124 226 1,843 Deferred taxes (credits): Federal 18,233 3,012 (8,256) Foreign 552 10 (386) $56,208 $24,276 $37,296
F-23 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED For income tax purposes, certain members of the AFC and American Premier consolidated tax groups had the following carryforwards available at December 31, 1995 (in millions): AFC Tax Group Expiring Amount { 1996 - 2001 $ 22 Operating Loss { 2002 - 2006 143 { 2007 - 2010 103 American Premier Tax Group Operating Loss 1996 $476 Capital Loss 1997 - 1999 311 Other - Tax Credits 23 Deferred income taxes reflect the impact of temporary differences between the carrying amounts of assets and liabilities recognized for financial reporting purposes and the amounts recognized for tax purposes. The significant components of deferred tax assets and liabilities for AFG's tax groups included in the Balance Sheet at December 31, were as follows (in millions):
1995 American AFC Premier Tax Group Tax Group 1994 Deferred tax assets: Net operating loss carryforwards $ 93.8 $166.5 $ 80.0 Capital loss carryforwards - 108.7 - Insurance claims and reserves 195.9 102.9 202.1 Other, net 41.2 91.3 53.5 330.9 469.4 335.6 Valuation allowance for deferred tax assets (91.9) (214.0) (111.1) 239.0 255.4 224.5 Deferred tax liabilities: Deferred acquisition costs (89.8) (31.2) (78.3) Investment securities (210.8) (23.8) (103.6) (300.6) (55.0) (181.9) Net deferred tax asset (liability) ($ 61.6) $200.4 $ 42.6
The gross deferred tax asset has been reduced by a valuation allowance based on an analysis of the likelihood of realization. Factors considered in assessing the need for a valuation allowance include: (i) recent tax returns, which show neither a history of large amounts of taxable income nor cumulative losses in recent years, (ii) opportunities to generate taxable income from sales of appreciated assets, and (iii) the likelihood of generating larger amounts of taxable income in the future. The likelihood of realizing this asset will be reviewed periodically; any adjustments required to the valuation allowance will be made in the period in which the developments on which they are based become known. Cash payments for income taxes, net of refunds, were $14.8 million, $30.0 million and $49.6 million for 1995, 1994 and 1993, respectively. F-24 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED K. Extraordinary Items Extraordinary items represent AFG's proportionate share of gains (losses) recorded by the following companies from their debt retirements. Amounts shown are net of minority interest and income tax benefits (in thousands): 1995 1994 1993 Subsidiaries: AFC (parent) ($1,713) ($ 6,454) $ - APU (parent) 6,137 - - GAHC (611) - - AAG (201) (1,328) (4,559) Investee: Chiquita (2,795) (9,036) _- $ 817 ($16,818) ($4,559) L. Commitments and Contingencies Loss accruals have been recorded for various environmental and occupational injury and disease claims and other contingencies arising out of the railroad operations disposed of by American Premier's predecessor, Penn Central Transportation Company ("PCTC"), prior to its bankruptcy reorganization in 1978. Any ultimate liability arising therefrom in excess of previously established loss accruals would normally be attributable to pre-reorganization events and circumstances and accounted for as a reduction in capital surplus. However, under purchase accounting in connection with the Mergers, any such excess liability will be charged to earnings in AFG's financial statements. American Premier's liability for environmental claims ($64.3 million at December 31, 1995, before claims for recovery of $9.5 million) consists of a number of proceedings and claims seeking to impose responsibility for hazardous waste remediation costs at certain railroad sites formerly owned by PCTC and certain other sites where hazardous waste was allegedly generated by PCTC's railroad operation. It is difficult to estimate remediation costs for a number of reasons, including the number and financial resources of other potentially responsible parties, the range of costs for remediation alternatives, changing technology and the time period over which these matters develop. American Premier's liability is based on information currently available and is subject to change as additional information becomes available. American Premier's liability for occupational injury and disease claims ($80.6 million at December 31, 1995, before claims for recovery of $62.1 million) includes pending and expected claims by former employees of PCTC for injury or disease allegedly caused by exposure to excessive noise, asbestos or other substances in the railroad workplace. Recorded amounts are based on the accumulation of estimates of reported and unreported claims and related expenses and estimates of probable recoveries from insurance carriers. In exchange for $5 million, AFC has agreed to indemnify a former subsidiary for up to $35 million in excess of a threshold amount of $25 million of the costs it may incur in the 12 years beginning April 1, 1993 to resolve environmental matters, bankruptcy claims and certain other matters. In connection with the 1994 sale of securities of a former subsidiary, American Premier assumed responsibility for certain environmental and other liabilities in consideration for an indemnity payment of $19.2 million. Additionally, another subsidiary has accrued $10.3 million at December 31, 1995, for environmental costs associated with the sales of former manufacturing properties. F-25 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED In management's opinion, the outcome of the items discussed under "Uncertainties" in Management's Discussion and Analysis, beginning on page 26 of this Form 10-K, and the above claims and contingencies will not, individually or in the aggregate, have a material adverse effect on AFG's financial condition or results of operations. M. Benefit Plans AFG expensed ESORP contributions of $14.5 million in 1995, $6.2 million in 1994 and $9.4 million in 1993. AFG expensed postretirement benefits of $3.4 million in 1995, $2.4 million in 1994 and $3.1 million in 1993. N. Transactions With Affiliates In 1993, AFC sold stock of an affiliate to certain of its officers and employees for $1.8 million in cash and $270,000 in 5.25% unsecured notes due in five equal annual installments beginning in 1996. At Decemb er 31, 1993, an AFC real estate subsidiary owed $452,000 to The Provident Bank under a loan purchased by Provident in 1991 from an unrelated bank. The loan was repaid in 1994. Members of the Lindner family are majority owners of Provident's parent. In 1995, a subsidiary of AFC sold a house to its Chairman for $1.8 million. All of the above transactions have taken place at approximate market rates or values and, in the opinion of management, all amounts receivable are fully collectible. F-26 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED O. Quarterly Operating Results (Unaudited) The operations of certain of AFG's business segments are seasonal in nature. While insurance premiums are recognized on a relatively level basis, claim losses related to adverse weather (snow, hail, hurricanes, tornados, etc.) may be seasonal. Quarterly results necessarily rely heavily on estimates. These estimates and certain other factors, such as the nature of investees' operations and discretionary sales of assets, cause the quarterly results not to be necessarily indicative of results for longer periods of time. See Notes A and C for changes in ownership of companies whose revenues are included in the consolidated operating results and for the effects of gains on sales of subsidiaries and investees in individual quarters. The following are quarterly results of consolidated operations for the two years ended December 31, 1995 (in millions, except per share amounts).
1st 2nd 3rd 4th Total Quarter Quarter Quarter Quarter Year 1995 Revenues $553.2 $1,005.9 $1,002.5 $1,068.0 $3,629.6 Earnings before extraordinary items 29.8 33.0 51.0 76.6 190.4 Extraordinary items - .5 2.0 (1.7) .8 Net earnings 29.8 33.5 53.0 74.9 191.2 Earnings per common share: Before extraordinary items $.83 $.63 $.95 $1.36 $3.87 Extraordinary items - .01 .04 (.03) .01 Net earnings .83 .64 .99 1.33 3.88 Average number of Common Shares 28.3 52.7 53.4 56.1 47.6 1994 Revenues $523.6 $508.0 $537.5 $533.7 $2,102.8 Earnings (loss) before extraordinary items 26.7 23.2 7.5 (38.5) 18.9 Extraordinary items (15.7) (.7) (.5) .1 (16.8) Net earnings (loss) 11.0 22.5 7.0 (38.4) 2.1 Earnings (loss) per common share: Before extraordinary items $.70 $.60 $.04 ($1.58) ($.24) Extraordinary items (.54) (.03) (.02) - (.59) Net earnings (loss) .16 .57 .02 (1.58) (.83) Average number of Common Shares 28.3 28.3 28.3 28.3 28.3
Quarterly earnings per share do not add to year-to-date amounts due to changes in shares outstanding during 1995. Results for 1994 included credits of $3.9 million and $5.3 million in the second and third quarters and a fourth quarter charge of $43.9 million for units outstanding under AFC's Book Value Incentive Plan. Realized gains on sales of securities amounted to (in millions):
1st 2nd 3rd 4th Total Quarter Quarter Quarter Quarter Year 1995 $ 3.5 $7.9 $23.6 $49.0 $84.0 1994 14.9 8.2 20.0 5.2 48.3
F-27 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED P. Insurance Securities owned by insurance subsidiaries having a carrying value of approximately $1.6 billion at December 31, 1995, were on deposit as required by regulatory authorities. Other income includes life, accident and health premiums of $15.7 million in 1995, $2.2 million in 1994 and $2.4 million in 1993. During the third quarter of 1994, the California Supreme Court upheld Proposition 103, an insurance reform measure passed by California voters in 1988. In addition to increasing rate regulation, Proposition 103 gives the California insurance commissioner power to mandate rate rollbacks for most lines of property and casualty insurance. GAI recorded a charge of $26 million (included in "Other operating and general expenses") in the third quarter of 1994 in response to the California court decision. This charge was revised at December 31, 1994 to reflect a settlement agreement signed in March 1995 setting GAI's refund obligation at $19 million. The agreement was finalized in 1995 following a required waiting period. Several proposals have been made in recent years to change the federal income tax system. Some proposals included changes in the method of treating investment income and tax deferred income. To the extent a new tax law reduces or eliminates the tax deferred status of AFG's annuity products, that segment could be materially affected. Insurance Reserves The liability for losses and loss adjustment expenses for certain long-term scheduled payments under workers' compensation, auto liability and other liability insurance has been discounted at rates ranging from 4% to 8%. As a result, the total liability for losses and loss adjustment expenses at December 31, 1995, has been reduced by $67 million. The following table provides an analysis of changes in the liability for losses and loss adjustment expenses, net of reinsurance (and grossed up), over the past three years on a GAAP basis (in millions): 1995 1994 1993 Balance at beginning of period $2,187 $2,113 $2,886 Reserves of American Premier: At date of deconsolidation - - (785) At date of the Mergers 1,090 - - Provision for losses and loss adjustment expenses occurring in the current year 2,116 1,027 1,103 Net decrease in provision for claims occurring in prior years (139) (40) (39) 1,977 987 1,064 Payments for losses and loss adjustment expenses occurring during: Current year (987) (381) (363) Prior years (874) (532) (689) (1,861) (913) (1,052) Balance at end of period $3,393 $2,187 $2,113 Add back reinsurance recoverables 704 730 611 Unpaid losses and loss adjustment expenses included in Balance Sheet, gross of reinsurance $4,097 $2,917 $2,724 F-28 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED Net Investment Income The following table shows (in millions) investment income earned and investment expenses incurred by AFG's insurance companies. 1995 1994 1993 Insurance group investment income: Fixed maturities $727.3 $560.6 $566.2 Equity securities 5.3 8.3 9.9 Other 7.9 6.7 4.7 740.5 575.6 580.8 Insurance group investment expenses(*) (33.8) (32.0) (38.9) $706.7 $543.6 $541.9 (*) Included primarily in "Other operating and general expenses" in the Statement of Earnings. Statutory Information AFG's insurance subsidiaries are required to file financial statements with state insurance regulatory authorities prepared on an accounting basis prescribed or permitted by such authorities (statutory basis). Net earnings and policyholders' surplus on a statutory basis for the insurance subsidiaries were as follows (in millions): Policyholders' Net Earnings Surplus 1995 1994 1993 1995 1994 Property and casualty companies $200 $63 $179 $1,595 $943 Life insurance companies 76 54 44 273 256 Reinsurance In the normal course of business, AFG's insurance subsidiaries assume and cede reinsurance with other insurance companies. The following table shows (in millions) (i) amounts deducted from property and casualty premium income accounts in connection with reinsurance ceded, (ii) amounts included in income for reinsurance assumed and (iii) reinsurance recoveries deducted from losses and loss adjustment expenses. 1995 1994 1993 Reinsurance ceded to: Non-affiliates $476 $402 $333 Affiliates 33 161 89 Reinsurance assumed - including non-voluntary pools and associations 93 83 61 Reinsurance recoveries 304 429 343 Q. Additional Information Total rental expense for various leases of railroad rolling stock, office space and data processing equipment was $35 million, $22 million and $24 million for 1995, 1994 and 1993, respectively. Sublease rental income related to these leases totaled $6.2 million in 1995, $6.4 million in 1994 and $6.6 million in 1993. Future minimum rentals, related principally to office space and railroad rolling stock, required under operating leases having initial or remaining noncancelable lease terms in excess of one year at December 31, 1995, were as follows: 1996 - $43 million, 1997 - $37 million, 1998 - $27 million, 1999 - $19 million; 2000 - $10 million and $18 million thereafter. At December 31, 1995, minimum sublease rentals to be received through the expiration of the leases aggregated $27 million. F-29 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED Other operating and general expenses included charges for possible losses on agents' balances, reinsurance recoverables and other receivables in the following amounts: 1995 - $0, 1994 - $18 million and 1993 - $10 million. The aggregate allowance for such losses amounted to approximately $144 million and $109 million at December 31, 1995 and 1994, respectively. Fair Value of Financial Instruments The following table presents (in millions) the carrying value and estimated fair value of AFG's financial instruments at December 31. 1995 1994 Carrying Fair Carrying Fair Value Value Value Value Assets: Bonds and redeemable preferred stocks $9,538 $9,679 $6,492 $6,199 Other stocks 252 252 209 209 Liabilities: Annuity benefits accumulated $5,052 $4,887 $4,618 $4,510 Long-term debt: AFC (parent company) 311 325 490 473 APU (parent company) 337 344 - - Other subsidiaries 234 243 617 618 When available, fair values are based on prices quoted in the most active market for each security. If quoted prices are not available, fair value is estimated based on present values, discounted cash flows, fair value of comparable securities, or similar methods. The fair value of the liability for annuities in the payout phase is assumed to be the present value of the anticipated cash flows, discounted at current interest rates. Fair value of annuities in the accumulation phase is assumed to be the policyholders' cash surrender amount. Financial Instruments with Off-Balance-Sheet Risk On occasion, AFG and its subsidiaries have entered into financial instrument transactions which may present off-balance-sheet risks of both credit and market risk nature. These transactions include commitments to fund loans, loan guarantees and commitments to purchase and sell securities or loans. At December 31, 1995, AFG and its subsidiaries had commitments to fund credit facilities and contribute limited partnership capital totaling $17 million. Restrictions on Transfer of Funds and Assets of Subsidiaries Payments of dividends, loans and advances by AFG's subsidiaries are subject to various state laws, federal regulations and debt covenants which limit the amount of dividends, loans and advances that can be paid. The maximum amount of dividends payable (without prior approval from state insurance regulators) in 1996 from AFG's insurance subsidiaries is approximately $210 million. Total "restrictions" on intercompany transfers from AFG's subsidiaries cannot be quantified due to the discretionary nature of the restrictions. R. Subsequent Event (Unaudited) In January 1996, AFG announced that it has agreed to sell its subsidiary, Buckeye Management Company, to Buckeye management (including an AFG director who resigned in March 1996) and employees for $63 million in cash. In connection with the sale, the AFG director has converted his AFG convertible preferred stock into 446,799 shares of AFG Common Stock and sold such shares in the open market. The sale of Buckeye is expected to close in late March 1996. F-30 PART IV ITEM 14 Exhibits, Financial Statement Schedules and Reports on Form 8-K (a) Documents filed as part of this Report: 1. Financial Statements are included in Part II, Item 8. 2. Financial Statement Schedules: A. Selected Quarterly Financial Data is included in Note O to the Consolidated Financial Statements. B. Schedules filed herewith for 1995, 1994 and 1993: Page I - Condensed Financial Information of Registrant S-2 V - Supplemental Information Concerning Property-Casualty Insurance Operations S-4 All other schedules for which provisions are made in the applicable regulation of the Securities and Exchange Commission have been omitted as they are not applicable, not required, or the information required thereby is set forth in the Financial Statements or the notes thereto. 3. Exhibits - see Exhibit Index on page E-1. (b) Reports on Form 8-K: Date of Reports Items Reported December 13, 1995 Court of Appeals Ruling - USX Litigation February 14, 1996 Agreement to sell Citicasters Common Stock S-1 AMERICAN FINANCIAL GROUP, INC. - PARENT ONLY (*) SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT (In Thousands) Condensed Balance Sheet December 31, Assets: 1995 1994 Cash and short-term investments $ 96,207 $ 4,896 Investment in securities - 1,786 Receivables from affiliates 85,055 288,271 Investment in subsidiaries 1,260,690 976,151 Investment in investee corporations - 233,908 Other assets 6,204 49,747 $1,448,156 $1,554,759 Liabilities and Capital: Accounts payable, accrued expenses and other liabilities $ 8,019 $ 83,783 Payables to affiliates - 582,048 Long-term debt - 490,065 Capital subject to mandatory redemption - 2,880 Other capital 1,440,137 395,983 $1,448,156 $1,554,759 Condensed Statement of Earnings Year Ended December 31, Income: 1995 1994 1993 Dividends from: Subsidiaries $ 37,044 $ 25,571 $248,168 Investees 879 3,514 4,035 37,923 29,085 252,203 Equity in undistributed earnings of subsidiaries and investees 224,921 113,631 65,435 Realized gains (losses) on sales of: Securities - 7,477 (1,743) Investees - (5,555) 59,182 Investment and other income 9,131 26,546 21,370 271,975 171,184 396,447 Costs and Expenses: Interest charges on borrowed money 13,997 60,439 74,793 Book Value Incentive Plan - 44,166 596 Other operating and general expenses 11,059 23,011 59,073 25,056 127,616 134,462 Earnings before income taxes and extraordinary items 246,919 43,568 261,985 Provision for income taxes 56,489 24,650 37,296 Earnings before extraordinary items 190,430 18,918 224,689 Extraordinary items, net of income taxes 817 (16,818) (4,559) Net Earnings $191,247 $ 2,100 $220,130 (*) Financial statements for periods prior to the Mergers are those of AFC. Results for 1995 include the earnings of AFC (parent only) for the period prior to the Mergers. S-2 AMERICAN FINANCIAL GROUP, INC. - PARENT ONLY (*) SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT - CONTINUED (In Thousands) Condensed Statement of Cash Flows
Year Ended December 31, 1995 1994 1993 Operating Activities: Net earnings $191,247 $ 2,100 $220,130 Adjustments: Extraordinary losses from retirement of debt (817) 16,818 4,559 Equity in earnings of subsidiaries (193,206) (88,060) (172,803) Equity in net earnings of investees (4,462) (2,872) (1,963) Depreciation and amortization 123 612 3,778 Realized gains on sales of subsidiaries and investments - (1,929) (57,421) Writeoff of debt discount and issue costs - - 24,814 Change in receivables from and payables to affiliates (100,225) 125,427 (196,338) Increase (decrease) in payables (10,861) 37,051 (13,146) Dividends from subsidiaries and investees 36,649 20,504 131,914 Other 7,414 (2,194) (16,943) (74,138) 107,457 (73,419) Investing Activities: Purchases of subsidiaries and other investments (30) - (29,501) Sales of subsidiaries and other investments - 20,975 126,196 Other, net 255 (788) 344 225 20,187 97,039 Financing Activities: Additional long-term borrowings 70 732 9,984 Reductions of long-term debt (325) (89,901) (9,062) Issuances of common stock 211,557 - - Repurchases of common and preferred stock (17) (6,738) (2,643) Cash dividends paid (36,532) (29,522) (28,034) Cash of predecessor company at date of merger (9,529) - - 165,224 (125,429) (29,755) Net Increase (Decrease) in Cash and Short-term Investments 91,311 2,215 (6,135) Cash and short-term investments at beginning of period 4,896 2,681 8,816 Cash and short-term investments at end of period $ 96,207 $ 4,896 $ 2,681
(*) Financial statements for periods prior to the Mergers are those of AFC. Results for 1995 include the cash flows of AFC (parent only) for the period prior to the Mergers. S-3 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES SCHEDULE V - SUPPLEMENTAL INFORMATION CONCERNING PROPERTY-CASUALTY INSURANCE OPERATIONS THREE YEARS ENDED DECEMBER 31, 1995 (IN MILLIONS)
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F (a) AFFILIA- RESERVES (b) TION WITH DEFERRED FOR UNPAID DISCOUNT (c) WITH POLICY CLAIMS AND DEDUCTED UNEARNED EARNED REGISTRANT ACQUISITION CLAIMS AD- COLUMN C PREMIUMS PREMIUMS COSTS JUSTMENT EXPENSES CONSOLIDATED PROPERTY-CASUALTY ENTITIES 1995 (d) $270 $4,097 $67 $1,294 $2,649 1994 $166 $2,917 $71 $ 825 $1,379 1993 (d) $1,495 COLUMN G COLUMN H COLUMN I COLUMN J COLUMN K AMORTIZATION PAID NET INVESTMENT ADJUSTMENT EXPENSES POLICY AND CLAIM WRITTEN INCOME INCURRED RELATED TO ACQUISITION ADJUSTMENT COSTS EXPENSES CURRENT PRIOR YEAR YEAR CONSOLIDATED PROPERTY-CASUALTY ENTITIES 1995 (d) $303 $2,116 ($139) $577 $1,861 $2,688 1994 $177 $1,027 ($ 40) $329 $ 913 $1,481 1993 (d) $206 $1,103 ($ 39) $345 $1,052 $1,587
(a) Grossed up for reinsurance recoverables of $704 and $730 at December 31, 1995 and 1994, respectively. (b) Discounted at rates ranging from 4% to 8%. (c) Grossed up for prepaid reinsurance premiums of $143 and $172 at December 31, 1995 and 1994, respectively. (d) Includes American Premier's Insurance Group through March 31, 1993, and after April 1, 1995. S-4 INDEX TO EXHIBITS AMERICAN FINANCIAL GROUP, INC. Number Exhibit Description 2 Agreement and Plan of Acquisition and Reorganization filed as Exhibit 2 to AFG's Registration Statement on Form S-4 effective February 17, 1995. (*) 3(a) Amended and Restated Articles of Incorporation. _____ 3(b) Amended Code of Regulations. _____ 4 Instruments defining the The rights of holders of rights of security holders. Registrant's Preferred Stock are defined in the Articles of Incor- poration. Registrant has no out- standing debt issues. Management Contracts: 10(a) Stock Option Plan filed as (*) Exhibit (10)(iii)(a)(i) to AFG's Registration Statement on Form 8-B filed on April 17, 1995. 10(b) Form of certain stock option agreement. _____ 10(c) Stock Option Loan Program. _____ 10(d) Bonus Plan for 1996. _____ 10(e) Retirement program for outside directors. _____ 10(f) Directors' Compensation Plan. _____ 10(g) Severance Agreement between American Premier and an AFG executive officer. _____ 10(h) Agreement relating to the sale of Buckeye Management Company. _____ 11 Computation of earnings per share. _____ 12 Computation of ratios of earnings to fixed charges. _____ 16 Letter from Deloitte & Touche LLP included in AFG's Form 8-K filed on August 29, 1995. (*) 21 Subsidiaries of the Registrant. _____ 23 Consents of independent auditors. _____ 27 Financial data schedule. (**) 28 Information from reports furnished to state insurance regulatory authorities. _____ (*) Incorporated herein by reference. (**) Copy included in Report filed electronically with the Securities and Exchange Commission. E-1 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES EXHIBIT 11 - COMPUTATION OF EARNINGS PER SHARE FOR THE YEAR ENDED DECEMBER 31, 1995 (In Thousands, Except Per Share Amounts) Earnings before extraordinary items $190,430 Preferred dividend requirement of predecessor company (6,349) Net earnings before extraordinary items available to common shareholders 184,081 Extraordinary items 817 Net earnings available to common shareholders $184,898 Computation of primary earnings per common share Shares used in calculation of per share data: Weighted average common shares outstanding 47,620 Dilutive effect of assumed exercise of certain stock options 503 Weighted average common shares used to calculate primary earnings per share 48,123 Primary earnings per common share Dilution less than 3% Computation of fully diluted earnings per common share Shares used in calculation of per share data: Weighted average common shares outstanding 47,620 Dilutive effect of assumed exercise of certain stock options 608 Weighted average common shares used to calculate fully diluted earnings per share 48,228 Fully diluted earnings per common share Dilution less than 3% Reported earnings per share based on weighted average common shares outstanding Before extraordinary items $3.87 Extraordinary items .01 Net earnings $3.88 E-2 AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES EXHIBIT 12 - COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES (Dollars in Thousands)
Year Ended December 31, 1995 1994 1993 1992 1991 Pretax income (loss) excluding discontinued operations $247,455 $ 26,376 $257,426 ($144,854) $118,710 Minority interest in subsidiaries having fixed charges(*) 33,190 8,565 34,800 37,685 44,369 Less undistributed equity in (earnings) losses of investees (1,559) 49,010 (25,067) 376,020 5,817 Fixed charges: Interest expense 124,633 114,803 153,836 212,150 245,757 Debt discount (premium) and expense (1,023) 1,240 5,273 4,698 6,961 One-third of rentals 9,471 5,119 5,801 16,341 45,286 EARNINGS $412,167 $205,113 $432,069 $502,040 $466,900 Fixed charges: Interest expense $124,633 $114,803 $153,836 $212,150 $245,757 Debt discount (premium) and expense (1,023) 1,240 5,273 4,698 6,961 One-third of rentals 9,471 5,119 5,801 16,341 45,286 Pretax preferred dividend requirements of subsidiaries 25,376 - - - 598 Capitalized interest - - - - 5,495 FIXED CHARGES $158,457 $121,162 $164,910 $233,189 $304,097 Ratio of Earnings to Fixed Charges 2.60 1.69 2.62 2.15 1.54 Earnings in excess of Fixed Charges $253,710 $ 83,951 $267,159 $268,851 $162,803
(*) Amounts include preferred dividends of subsidiaries. E-3 AMERICAN FINANCIAL GROUP, INC. EXHIBIT 21 - SUBSIDIARIES OF THE REGISTRANT The following is a list of subsidiaries of AFG at December 31, 1995. All corporations are subsidiaries of AFG and, if indented, subsidiaries of the company under which they are listed. Percentage of State of Common Equity Name of Company Incorporation Ownership American Financial Corporation Ohio 100 Great American Holding Corporation Ohio 100 Great American Insurance Company Ohio 100 American Annuity Group, Inc. Delaware 81 Great American Life Insurance Company Ohio 100 American Empire Surplus Lines Insurance Company Delaware 100 American National Fire Insurance Company New York 100 Great American Management Services, Inc. Ohio 100 Mid-Continent Casualty Company Oklahoma 100 Stonewall Insurance Company Alabama 100 Transport Insurance Company Ohio 100 American Financial Enterprises, Inc. Connecticut 83 American Premier Underwriters, Inc. Pennsylvania 100 Pennsylvania Company Delaware 100 Atlanta Casualty Company Illinois 100 Infinity Insurance Company Florida 100 Leader National Insurance Company Ohio 100 Republic Indemnity Company of America California 100 Republic Indemnity Company of California California 100 Windsor Insurance Company Indiana 100 The names of certain subsidiaries are omitted, as such subsidiaries in the aggregate would not constitute a significant subsidiary. See Part I, Item 1 of this Report for a description of certain companies in which AFG owns a significant portion and accounts for under the equity method. E-4 AMERICAN FINANCIAL GROUP, INC. EXHIBIT 28 - INFORMATION FROM REPORTS FURNISHED TO STATE INSURANCE REGULATORY AUTHORITIES Schedule P of Annual Statements A. CONSOLIDATED PROPERTY AND CASUALTY ENTITIES - See Attached Schedules Schedule P (prepared in accordance with the rules prescribed by the National Association of Insurance Commissioners) includes the reserves of AFG's consolidated property and casualty subsidiaries. The following is a summary of Schedule P reserves (in millions): Schedule P - Part 1 Summary - col. 33 $2,815 - col. 34 579 Statutory Loss and Loss Adjustment Expense Reserves $3,394 B. UNCONSOLIDATED SUBSIDIARIES None C. 50% OR LESS OWNED PROPERTY AND CASUALTY INVESTEES None E-5 AMERICAN FINANCIAL GROUP, INC. EXHIBIT 23 - CONSENTS OF INDEPENDENT AUDITORS We consent to the incorporation by reference in Registration Statement No. 33-58825 on Form S-8, Registration Statement No. 33-58827 on Form S-8, and Registration Statement No. 33-59989 on Form S-3 of our report dated March 15, 1996, with respect to the consolidated financial statements and schedules of American Financial Group, Inc. included in the Annual Report on Form 10-K for the year ended December 31, 1995. ERNST & YOUNG LLP Cincinnati, Ohio March 27, 1996 _________________________________________________________________ We consent to the incorporation by reference in Registration Statement No. 33-58825 on Form S-8, Registration Statement No. 33-58827 on Form S-8, and Registration Statement No. 33-59989 on Form S-3 of our report dated February 15, 1995 (March 23, 1995 with respect to the acquisition of American Financial Corporation as discussed in Note B to the financial statements), appearing in the Annual Report on Form 10-K of American Financial Group, Inc. for the year ended December 31, 1995. DELOITTE & TOUCHE LLP Cincinnati, Ohio March 27, 1996 E-6 Signatures Pursuant to the requirements of Section 13 of the Securities Exchange Act of 1934, American Financial Group, Inc. has duly caused this Report to be signed on its behalf by the undersigned, duly authorized. American Financial Group, Inc. Signed: March 27, 1996 BY:s/CARL H. LINDNER Carl H. Lindner Chairman of the Board and Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated: Signature Capacity Date s/CARL H. LINDNER Chairman of the Board March 27, 1996 Carl H. Lindner of Directors s/THEODORE H. EMMERICH Director* March 27, 1996 Theodore H. Emmerich s/JAMES E. EVANS Director March 27, 1996 James E. Evans s/CARL H. LINDNER III Director March 27, 1996 Carl H. Lindner III s/WILLIAM R. MARTIN Director* March 27, 1996 William R. Martin s/FRED J. RUNK Senior Vice President and March 27, 1996 Fred J. Runk Treasurer (principal financial and accounting officer) * Member of the Audit Committee EX-27 2
5 This schedule contains summary financial information extracted from American Financial Group, Inc. 10-K for December 31, 1995 and is qualified in its entirety by reference to such financial statements. 1,000 12-MOS DEC-31-1995 DEC-31-1995 544,408 10,096,992 703,274 0 0 0 0 0 14,953,870 0 882,063 60,139 0 0 1,379,998 14,953,870 0 3,629,609 0 0 320,737 0 122,568 246,919 56,489 190,430 0 817 0 191,247 3.88 3.88 (1) Includes an investment in affiliates of $307 million.
EX-3 3 EXHIBIT 3A ARTICLES OF INCORPORATION AMENDED AND RESTATED ARTICLES OF INCORPORATION OF AMERICAN FINANCIAL GROUP, INC. FIRST. The name of the corporation is AMERICAN FINANCIAL GROUP, INC. (the "Corporation"). SECOND. The place in the State of Ohio where the Corporation's principal office is to be located is the City of Cincinnati in Hamilton County, Ohio. THIRD. The purpose for which the Corporation is organized shall be to engage in any lawful act or activity for which corporations may be formed under the Ohio General Corporation Law, Ohio Revised Code 1701.01 et seq.. FOURTH. The aggregate number of shares of stock which the Corporation shall have authority to issue is Two Hundred Twenty Five Million (225,000,000) shares, which shall be divided into two classes, consisting of: (a) Twenty Five Million (25,000,000) shares of preferred stock ("Preferred Stock") without par value; and, (b) Two Hundred Million (200,000,000) shares of common stock ("Common Stock") with a par value of $1.00 per share. PART ONE: PREFERRED STOCK (a) Except as otherwise provided by this Article Fourth or by the amendment or amendments adopted by the Board of Directors providing for the issue of any series of Preferred Stock, the Preferred Stock may be issued at any time or from time to time in any amount, not exceeding in the aggregate, including all shares of any and all series thereof theretofore issued, the Twenty Five Million (25,000,000) shares of Preferred Stock hereinabove authorized, as Preferred Stock of one or more series, as hereinafter provided, and for such lawful consideration as shall be fixed from time to time by the Board of Directors. Twelve Million Five Hundred Thousand (12,500,000) shares of Preferred Stock shall have voting rights as provided in clause (b) of this Part One of Article Fourth (collectively, "Voting Preferred Stock"). Twelve Million Five Hundred Thousand (12,500,000) shares of Preferred Stock shall have no voting power whatsoever, except as may be otherwise provided by law or except as may arise upon a default, failure or other contingency (collectively, "Non- Voting Preferred Stock"). The Career Shares Series created by Part Two of this Article Fourth are shares of Non-Voting Preferred Stock. All shares of any one series of Preferred Stock shall be alike in every particular, each series thereof shall be distinctively designated by letter or descriptive words, and all series of Preferred Stock shall rank equally and be identical in all respects except as provided above with respect to Voting Preferred Stock and Non-Voting Preferred Stock or as permitted by the provisions of Clause (b) of this Part One of Article Fourth. (b) Authority is hereby expressly granted to the Board of Directors from time to time to adopt amendments to these Articles of Incorporation providing for the issue in one or more series of any unissued or treasury shares of the Preferred Stock, and providing, to the fullest extent now or hereafter permitted by the laws of the State of Ohio and notwithstanding the provisions of any other Article of these Articles of Incorporation of the Corporation, in respect of the matters set forth in the following subdivisions (i) to (x), inclusive, as well as any other rights or matters pertaining to such series: (i) The designation and number of shares of such series; (ii) With respect to the Voting Preferred Stock only, voting rights (to the fullest extent now or hereafter permitted by the laws of the State of Ohio); (iii) With respect to the Non-Voting Preferred Stock only, voting rights upon a default, failure or other contingency; (iv) The dividend rate or rates of such series (which may be a variable rate and which may be cumulative); (v) The dividend payment date or dates of such series; (vi) The price or prices at which shares of such series may be redeemed; (vii) The amount of the sinking fund, if any, to be applied to the purchase or redemption of shares of such series and the manner of its application; -2- (viii) The liquidation price or prices of such series; (ix) Whether or not the shares of such series shall be made convertible into, or exchangeable for, shares of any other class or classes or of any other series of the same class of stock of the Corporation or any other property, and if made so convertible or exchangeable, the conversion price or prices, or the rates of exchange at which such conversion or exchange may be made and the adjustments thereto, if any; and, (x) Whether or not the issue of any additional shares of such series or any future series in addition to such series shall be subject to any restrictions and, if so, the nature of such restrictions. Any of the voting rights (with respect to the Voting Preferred Stock only), voting rights upon a default, failure or other contingency (with respect to the Non-Voting Preferred Stock only), dividend rate or rates, dividend payment date or dates, redemption rights and price or prices, sinking fund requirements, liquidation price or prices, conversion or exchange rights and restrictions on issuance of shares of any such series of Preferred Stock may, to the fullest extent now or hereafter permitted by the laws of the State of Ohio, be made dependent upon facts ascertainable outside these Articles of Incorporation or outside the amendment or amendments providing for the issue of such Preferred Stock adopted by the Board of Directors pursuant to authority expressly vested in it by this Article Fourth. If the then-applicable laws of the State of Ohio do not permit the Board of Directors to fix, by the amendment creating a series of Voting Preferred Stock, the voting rights of shares of such series, each holder of a share of such series of Voting Preferred Stock shall, except as may be otherwise provided by law, be entitled to one (1) vote for each share of Voting Preferred Stock of such series held by such holder. PART TWO: CAREER SHARES (a) Two series of such Preferred Stock shall be as follows: SECTION 1. Designation. (A) Forty Nine Thousand Eight Hundred Eighty Eight (49,888) shares designated as the "$3.76 Convertible Preferred Stock, First Series", the shares of which shall be entitled to cumulative cash dividends at the annual rate of $3.76 per share and which shall be convertible into Common Stock at the initial rate of 2.0110 shares of Common Stock for each share of such Preferred Stock; and, -3- (B) One Hundred Sixty Two Thousand Eight Hundred Ten (162,810) shares designated as the "$4.20 Convertible Preferred Stock, Second Series", the shares of which shall be entitled to cumulative cash dividends at the annual rate of $4.20 per share and which shall be convertible into Common Stock at the initial rate of 2.1281 shares of Common Stock for each share of such Preferred Stock. SECTION 2. General Terms. (A) The series of Preferred Stock designated in Section 1 will be referred to hereinafter collectively as Career Share Series and any shares of any thereof as Career Shares. Except as to designation, annual dividend rate and initial conversion rate, the terms of the shares of any Career Share Series shall be identical to the terms of the shares of each other Career Share Series. The terms on which Career Shares may be converted into Common Stock and the payment of dividends at the rate specified in Section 1 shall be subject to, and terms of the Career Shares generally shall be as set forth in, the remaining Sections of this paragraph (a) of this Part Two of Article Fourth. (B) Nothing herein shall be deemed to constitute a limitation on the authority of the Board of Directors to designate by amendment or amendments adopted by the Board of Directors, out of the authorized Preferred Stock, series of Preferred Stock not governed by the terms of this paragraph (a) of this Part Two of Article Fourth. SECTION 3. Dividend Rights. Holders of record of shares of Career Share Series shall be entitled to receive, as and if declared by the Board of Directors, out of assets legally available therefor, cumulative cash dividends at the annual rate set forth in Section 1. Dividends on such Career Shares will accrue from the respective dates of original issuance of such shares and, with respect to each such share, will be payable quarterly on February 15, May 15, August 15 and November 15 in each year commencing on the first of such dates occurring more than 30 days after the date of issuance of such share. In the event that full cumulative dividends on outstanding shares of any Career Share Series have not been paid when scheduled, no dividends shall be declared or paid on, and no such amounts shall be set aside or applied to the redemption or purchase of, any shares of Common Stock of the Corporation or any other shares of capital stock of the Corporation ranking subordinate to such Career Share Series with respect to the payment of dividends (other than a dividend in capital stock ranking subordinate to Career Share Series as to dividends), and, in such event, all dividends declared on the Career Shares and any other series of capital stock of the Corporation ranking on a parity as to dividends with such Career Share Series shall be declared pro rata among each such series. -4- SECTION 4. Subordination. The rights of any Career Share Series with respect to dividends shall be subordinate to any shares of capital stock of the Corporation which are by their terms superior to the rights of such Career Shares Series with respect to dividends. The rights of the Common Stock of the Corporation shall be subordinate to Career Shares with respect to the dividend rights set forth in Section 3. SECTION 5. Conversion Privilege and Price. Career Shares shall be convertible into shares of Common Stock at any time and from time to time, at the option of the holder thereof, provided, however, that such conversion privilege shall be subject to any contractual agreements between the Corporation and the holder thereof regarding such privilege for so long as such holder continues to hold shares of such Career Share Series. The rate at which shares of Common Stock shall be delivered upon conversion shall initially be as set forth in Section 1. All conversions of Career Shares into shares of Common Stock shall be subject to the following terms and conditions: (A) The Corporation shall make no payment or adjustment on account of any dividends declared but unpaid on the Common Stock issuable upon conversion. (B) The number of shares of Common Stock into which Career Shares are convertible shall be subject to adjustment from time to time as follows except that no adjustment need be made unless, by reason of the happening of any one or more of the events specified in this Section 5(B), the conversion rate then in effect shall be changed by 1% or more, but any adjustment of less than 1% that would otherwise be required then to be made shall be carried forward and shall be made at the time of and together with any subsequent adjustment which, together with any adjustment or adjustments so carried forward, amounts to 1% or more, provided that such adjustment shall be made in all events (regardless of whether or not the amount thereof or the cumulative amount thereof amounts to 1% or more) after a period of three years from the date of happening of an event requiring adjustment as specified in this Section 5(B): (i) In case the Corporation shall issue rights or warrants to holders of shares of Common Stock entitling them (for a period expiring within 90 days after the record date mentioned below) to subscribe for or purchase shares of Common Stock at a price less than the current market price per share of Common Stock (as determined pursuant to Subsection 5(B)(vi) on the record date mentioned below), the conversion rate (such rate being initially as set forth in Section 1) shall be adjusted so that the conversion rate shall equal the rate determined by multiplying the conversion rate in effect immediately -5- prior to the date of issuance of such rights or warrants by a fraction whose numerator shall be the number of shares of Common Stock outstanding on the date of issuance of such rights or warrants plus the number of shares which the aggregate exercise price of the shares of Common Stock called for by all rights or warrants issued would purchase at such current market price, and whose denominator shall be the number of shares of Common Stock outstanding on the date of issuance of such rights or warrants plus the number of additional shares of Common Stock called for by such rights or warrants. Such adjustment shall be made whenever such rights or warrants are issued and shall be retroactively effective as of immediately after the record date for the determination of holders of Common Stock entitled to receive such rights or warrants. (ii) In case the Corporation shall at any time or times (1) pay a dividend on the Common Stock in shares of capital stock, (2) subdivide its outstanding shares of Common Stock into a greater number of shares, (3) combine its outstanding shares of Common Stock into a smaller number of shares or (4) issue by reclassification of its shares of Common Stock, or any recapitalization or reorganization of the Corporation, any shares of capital stock of the Corporation (other than a change from par value to no par value), then, in each such case, the conversion rate (such rate being initially as set forth in Section 1) in effect immediately prior thereto shall be adjusted so that the holder of any Career Shares thereafter surrendered for conversion shall be entitled to receive the number and kinds of shares of capital stock which he would have owned or would have been entitled to receive immediately after the happening of any of the events described above had such Career Shares been converted immediately prior to the happening of such event. An adjustment made pursuant to this Subsection 5(B)(ii) shall become effective as of immediately after the record date in those cases specified in clause (1) of this Subsection 5(B)(ii) and shall become effective as of immediately after the effective date in those cases specified in clauses (2), (3) and (4) of this Subsection 5(B)(ii). (iii) In case the Corporation shall distribute to holders of its Common Stock evidence of its indebtedness or assets or rights to subscribe for or warrants to purchase (excluding those referred to in Subsection 5(B)(i)) shares of Common Stock or any other security, or shall make a capital distribution on its shares of Common Stock, then in each such case the conversion rate shall be adjusted so that the conversion rate (such rate being initially as set forth in Section 1) shall equal the rate determined by multiplying the conversion rate in effect immediately prior to the date of such distribution by a fraction whose numerator shall be the current market price per share of Common Stock (determined as provided in Subsection 5(B)(vi)) on the effective date of distribution minus the then fair market value (as determined by the Board of Directors, whose determination shall be -6- conclusive and evidenced by a Board resolution) of the portion of the assets or evidences of indebtedness so distributed or of such subscription rights or warrants, or of the capital distribution, applicable to one share of Common Stock and whose denominator shall be such current market price per share of the Common Stock. Such adjustment shall be made whenever any such distribution is made and shall be retroactively effective as of immediately after the record date for the determination of holders of Common Stock entitled to receive such distribution. (iv) In case the Corporation shall issue to holders of shares of Common Stock shares of Common Stock pursuant to any dividend reinvestment plan at a price less than the current market price per share of Common Stock (determined as provided in Subsection 5(B)(vi) below) on the date of issuance of such shares pursuant to such dividend reinvestment plan, then in each such case, the conversion rate (such rate being initially as set forth in Section 1) shall equal the rate determined by multiplying the conversion rate in effect immediately prior to the date of issuance of such shares by a fraction whose numerator shall be the number of shares of Common Stock outstanding on the date of issuance of such shares plus the number of shares of Common Stock which the aggregate purchase price for shares being purchased on such date of issuance pursuant to any such dividend reinvestment plan would purchase at such current market price, and whose denominator shall be the number of shares of Common Stock outstanding on such date of issuance plus the number of additional shares of Common Stock issued pursuant to any such dividend reinvestment plan. Such adjustment shall be retroactively effective as of immediately after such date of issuance. (v) If any capital reorganization or reclassification of the capital stock of the Corporation, or consolidation or merger of the Corporation with another corporation, or the sale of all or substantially all of its assets to another corporation, shall be effected in such a way that holders of shares of Common Stock shall be entitled to receive stock, securities or assets with respect to or in exchange for shares of Common Stock, then, as a condition of such reorganization, reclassification, consolidation, merger or sale, the Corporation or such successor or purchasing corporation, as the case may be, shall make provision that the holder of each Career Share shall have the right thereafter to convert such share into the kind and amount of stock, securities or assets receivable upon such reorganization, reclassification, consolidation, merger or sale by a holder of the number of shares of Common Stock into which such share might have been converted immediately prior to such reorganization, reclassification, consolidation, merger or sale, subject to adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 5(B). -7- (vi) For the purpose of any computation of current market price per share of Common Stock under this Section 5(B), the current market price per share of Common Stock on any date shall be deemed to be the average of the daily closing prices for the 10 consecutive business days commencing 15 business days before the day in question. The closing price for each day shall be the last reported sales price regular way or, in case no such reported sale takes place on such day, the average of the reported closing bid and asked prices regular way, in either case on the New York Stock Exchange, or, if the Common Stock is not listed or admitted to trading on such Exchange, on the principal national securities exchange on which the Common Stock is listed or admitted to trading, or, if not listed or admitted to trading on any national securities exchange, the average of the closing bid and asked prices in the over-the-counter market, as furnished by any New York Stock Exchange firm selected from time to time by the Corporation for that purpose. For purposes of this Subsection 5(B)(vi), the term business day shall not include any day on which securities are not traded on such exchange or in such market. (vii) The Corporation shall not be required to issue fractional shares of Common Stock upon conversion of Career Shares. If more than one share of any Career Shares Series shall be surrendered for conversion at one time by the same holder, the number of full shares of Common Stock issuable upon conversion thereof shall be computed on the basis of the aggregate number of shares so surrendered. If any fractional interest in a share of Common Stock would be deliverable upon the conversion of any Career Shares, the Corporation, in lieu of delivering the fractional share therefor, shall make an adjustment therefor in cash at the market value thereof. For the purpose of making a cash adjustment in lieu of delivering fractional shares, the market value of a share of Common Stock shall be the last reported sales price regular way or, in case no such reported sale takes place on such day, the average of the reported closing bid and asked prices regular way, in either case on the New York Stock Exchange on the last business day prior to the conversion date, or, if the Common Stock is not then listed or admitted to trading on such Exchange, on the principal national securities exchange on which the Common Stock is listed or admitted to trading, or, if not listed or admitted to trading on any national securities exchange, the average of the closing bid and asked prices in the over-the-counter market as furnished by any New York Stock Exchange firm selected from time to time by the Corporation for that purpose. For purposes of this Subsection 5(B)(vii), the term business day shall not include any day on which securities are not traded on such exchange or in such market. -8- (viii) Whenever any event occurs which would cause an adjustment of the securities or other assets into which any Career Shares would be converted, as herein provided, the Corporation shall promptly file with the transfer agent or agents for such Career Share Series (and with any conversion agent other than the transfer agent or agents) a report prepared by the Corporation accompanied by an opinion of a firm of independent public accountants selected by the Board of Directors (who may be the accountants regularly employed by the Corporation) setting forth the conversion rate applicable after such adjustment and setting forth a brief statement of the facts requiring such adjustment. Such report and opinion shall be conclusive evidence of the correctness of such adjustment and neither the transfer agent or agents nor any conversion agent shall be under any duty or responsibility with respect to any such report or opinion except to exhibit the same from time to time to any holder of any Career Share desiring an inspection thereof. Promptly after filing such report and opinion, the Corporation shall cause notice to be mailed specifying such adjustment to each holder of record of shares of such Career Share Series at his last address appearing on the books of the Corporation. Neither the transfer agent or agents nor any conversion agent shall at any time be under any duty or responsibility to any such holder to determine whether any facts exist which may require any adjustment of the conversion rate, or with respect to the nature and extent of such adjustment when made, or with respect to the method employed in making the same. (C) The Corporation shall at all times reserve and keep available, out of its authorized but unissued shares of Common Stock or out of shares of Common Stock held in its treasury, the full number of shares of Common Stock into which all Career Shares from time to time outstanding are convertible. (D) The issuance of stock certificates on conversions of Career Shares into shares of Common Stock shall be without charge to the converting stockholders for any issue tax. The Corporation shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of shares of Common Stock in any name other than that of the registered holder of the Career Shares converted, and the Corporation shall not be required to issue or deliver any such stock certificate unless and until the person or persons requesting the issuance thereof shall have paid to the Corporation the amount of such tax or shall have established to the satisfaction of the Corporation that such tax has been paid. -9- (E) Any holder of Career Shares who shall choose to convert Career Shares held by him pursuant to this Section 5 shall, as a condition of conversion, present the certificates for such Career Shares (which certificate or certificates, if the Corporation shall so require, shall be duly endorsed or accompanied by appropriate instruments of transfer satisfactory to the Corporation) at the office of the transfer agent or agents for such Career Shares, or at such other office as may be designated by the Corporation, and shall give written notice to the Corporation at said office that such holder elects to convert the same or part thereof and shall state in writing therein the name or names in which such holder wishes the certificate or certificates for shares of Common Stock to be issued. The Corporation will, as soon as practicable thereafter, issue and deliver at said office to such holder, or to the designee of such holder, certificates for the number of full shares of Common Stock to which such holder or its designee shall be entitled as aforesaid, together with cash in lieu of any fraction of a share as hereinabove provided and certificates for the Career Shares, if any, not converted. Career Shares shall be deemed to have been converted as of the close of business on the date of the presentation of such shares for conversion as provided above, and the person or persons entitled to receive the shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder or holders of such shares of Common Stock as of such time and date. SECTION 6. Voting. (A) The holders of Career Shares shall not be entitled to vote at any meeting of the shareholders of the Corporation or on any other occasion where shareholders are entitled to vote, except as otherwise expressly provided in this Section 6. The holders of shares of any Career Share Series shall vote as a single or separate class with the holders of all other series of Preferred Stock, or as a single or separate series of Preferred Stock, as and to the extent provided in Subsection 6(B) and by Ohio law. (B) The Corporation may, in the manner provided in Article Fifth and as permitted by Ohio law, from time to time alter or change the voting rights, dividend rate or rates, dividend payment date or dates, redemption rights and price, sinking fund requirements, conversion rights and restrictions on issuance of any Career Share Series; provided, however, that without the affirmative vote of the holders of at least two-thirds of the outstanding shares of all series of Preferred Stock, the Corporation shall not amend, alter, change, add or insert any provision in the Articles which, or authorize the merger or consolidation of the Corporation with any other corporation if the plan of such merger or consolidation contains any provision which if contained in the Articles, would (i) make any adverse change in the voting -10- rights, dividend rate or rates, dividend payment date or dates, redemption rights and price, sinking fund requirements, conversion rights and restrictions on issuance or special or relative rights of Preferred Stock, (ii) authorize a new class of stock senior or superior to Preferred Stock, or (iii) increase the number of authorized shares of a senior or superior class of stock, and, without the affirmative vote of the holders of at least a majority of the outstanding shares of all series of Preferred Stock, the Corporation shall not amend, alter, change, add or insert any provision in the Articles which, or authorize the merger or consolidation of the Corporation with any other corporation if the plan of such merger or consolidation contains any provision which if contained in the Articles, would increase the authorized number of shares of Preferred Stock. Without the affirmative vote of the holders of at least two-thirds of the outstanding shares of any Career Shares Series, the Corporation shall not amend, alter, change, add or insert any provision in the Articles which, or authorize the merger or consolidation of the Corporation with any other corporation if the plan of such merger or consolidation contains any provision which if contained in the Articles, would adversely affect such Career Share Series but would not adversely affect each other series of Preferred Stock. Nothing in this Section 6 shall require a class vote or consent in connection with the authorization,designation, increase or issuance of any shares of any class or series of capital stock which is subordinate to shares of any Career Share Series as to dividends, or in connection with the authorization, designation, increase or issuance of any bonds, mortgages, debentures or other obligations of the Corporation, or because of any adjustment in the provisions of any Career Share Series made pursuant to Section 5(B). SECTION 7. No Liquidation Preference. The holders of Career Shares shall not be entitled to any payment out of the assets of the Corporation in the event of a voluntary or involuntary liquidation, dissolution or winding up of the Corporation, which is preferential to the rights of the holders of Common Stock. SECTION 8. Status of Career Shares After Redemption. Career Shares of any series redeemed or purchased by the Corporation shall be retired and cancelled and shall not be reissued by the Board of Directors of the Corporation and shall be restored to the status of authorized but unissued shares of Preferred Stock. The Board of Directors shall, upon the redemption or repurchase of all the outstanding shares of any series of Career Shares, adopt an amendment to these Articles of Incorporation to eliminate all references to the shares of such series of Career Shares and to make such other appropriate changes as are required by such elimination. -11- FIFTH. Amendment to Articles of Incorporation. The Corporation shall have the right to amend, alter, change or repeal any provision contained in these Articles of Incorporation or any provision that may be added or inserted in these Articles of Incorporation, provided that: (a) Such amendment, alteration, change, repeal, addition or insertion is consistent with law and is accomplished in the manner now or hereafter prescribed by statute or these Articles; (b) Any provision of these Articles of Incorporation which requires, or the change of which requires, the vote or consent of all or a specific number or percentage of the holders of shares of any class or series shall not be amended, altered, changed or repealed by any lesser amount, number or percentage of votes or consents of such class or series; and, (c) No amendment to these Articles of Incorporation pursuant to Ohio Revised Code 1701.69(B)(10) or any successor provision may be adopted without the affirmative vote or consent of the holders of an aggregate of two-thirds of the total voting power of the Corporation. Any rights at any time conferred upon the shareholders of the Corporation are granted subject to the provisions of this Article. SIXTH. No holder of any shares of this Corporation shall have any preemptive rights to subscribe for or to purchase any shares of this Corporation of any class, whether such shares or such class be now or hereafter authorized, or to purchase or subscribe for any security convertible into, or exchangeable for, shares of any class or to which shall be attached or appertained any warrants or rights entitling the holder thereof to purchase or subscribe for shares of any class. SEVENTH. This Corporation, through its Board of Directors, shall have the right and power to purchase any of its outstanding shares at such price and upon such terms as may be agreed upon between the Corporation and any selling shareholder. EIGHTH. Subject to the provisions of Article Fifth hereof, the affirmative vote of shareholders entitled to exercise a majority of the voting power of this Corporation shall be required to amend these Articles of Incorporation, approve mergers and to take any other action which by law must be approved by a specified percentage of the voting power of the Corporation or of all outstanding shares entitled to vote. -12- NINTH. The provisions of Ohio Revised Code Chapter 1704 or any successor provisions relating to transactions involving interested shareholders shall not be applicable to the Corporation. TENTH. The provisions of Ohio Revised Code 1701.831 or any successor provisions relating to control share acquisitions shall not be applicable to the Corporation. ELEVENTH. These Amended and Restated Articles of Incorporation take the place of and supersede the existing Articles of Incorporation of the Corporation as heretofore amended. -13- EX-3 4 EXHIBIT 3B CODE OF REGULATIONS CODE OF REGULATIONS OF AMERICAN FINANCIAL GROUP, INC. ARTICLE I Shareholders Section 1. Annual Meetings. The Annual Meeting of the Shareholders of this Corporation, for the election of the Board of Directors and the transaction of such other business as may properly be brought before such meeting, shall be held at the time, date and place designated by the Board of Directors or, if it shall so determine, by the Chairman of the Board or the President. If the Annual Meeting is not held or if Directors are not elected thereat, a Special Meeting may be called and held for that purpose. Section 2. Special Meetings. Special meetings of the Share holders may be held on any business day when called by the Chairman of the Board, the President, a majority of Directors, or persons holding twenty percent of all voting power of the Corporation and entitled to vote at such meeting. Section 3. Place of Meetings. Any meeting of Shareholders may be held at such place within or without the State of Ohio as may be designated in the Notice of said meeting. Section 4. Notice of Meeting and Waiver of Notice 4.1 Notice. Written notice of the time, place and pur poses of any meeting of Shareholders shall be given to each Shareholder entitled thereto not less than seven (7) days nor more than sixty (60) days before the date fixed for the meeting and as prescribed by law. Such notice shall be given either by personal delivery or mail to the Share holders at their respective addresses as they appear on the records of the Corporation. Notice shall be deemed to have been given on the day mailed. If any meeting is adjourned to another time or place, no notice as to such adjourned meeting need be given other than by announcement at the meeting at which such an adjournment is taken. No business shall be transacted at any such adjourned meeting except as might have been lawfully transacted at the meeting at which such adjournment was taken. 4.2 Notice to Joint Owners. All notices with respect to any shares to which persons are entitled by joint or common ownership may be given to that one of such persons who is named first upon the books of this Corporation, and notice so given shall be sufficient notice to all the holde rs of such shares. 4.3 Waiver. Notice of any meeting may be waived in writing by any Shareholder either before or after any meeting, or by attendance at such meeting without protest to its commencement. Section 5. Shareholders Entitled to Notice and to Vote. If a record date shall not be fixed, the record date for the determina tion of Shareholders entitled to notice of or to vote at any meeting of Shareholders shall be the close of business on the twentieth day prior to the date of the meeting and only Sharehold ers of record at such record date shall be entitled to notice of and to vote at such meeting. Section 6. Quorum and Voting. The holders of shares entitling them to exercise a majority of the voting power of the Corporation, present in person or by proxy, shall constitute a quorum for any meeting. The Shareholders present in person or by proxy, whether or not a quorum be present, may adjourn the meeting from time to time without notice other than by announcement at the meeting. -2- In any other matter brought before any meeting of Shareholders, the affirmative vote of the holders of shares representing a majority of the votes actually cast shall be the act of the Shareholders provided, however, that no action required by law, the Articles, or these Regulations to be authorized or taken by the holders of a designated proportion of the shares of the Corporation may be authorized or taken by a lesser proportion. Section 7. Organization of Meetings. 7.1 Presiding Officer. The Chairman of the Board, or in his absence the President, or the person designated by the Board of Directors, shall call all meetings of the Shareholders to order and shall act as Chairman thereof; if all are absent, the Shareholders shall elect a Chairman. 7.2 Minutes. The Secretary of the Corporation, or in his absence, an Assistant Secretary, or, in the absence of both, a person appointed by the Chairman of the meeting, shall act as Secretary of the meeting and shall keep and make a record of the proceedings thereat. Section 8. Voting. Except as provided by statute or in the Articles, every Shareholder entitled to vote shall be entitled to cast one vote on each proposal submitted to the meeting for each share held of record on the record date for the determination of the Shareholders entitled to vote at the meeting. At any meeting at which a quorum is present, all questions and business which may come before the meeting shall be determined by a majority of votes cast, except when a greater proportion is required by law, the Articles, or these Regulations. Section 9. Proxies. A person who is entitled to attend a Shareholders' meeting, to vote thereat, or to execute consents, waivers and releases, may be represented at such meeting or vote thereat, and execute consents, waivers, and releases and exercise any of his rights, by proxy or proxies appointed by a writing signed by such person, or by his duly authorized attorney which may be transmitted physically, by facsimile or by other electronic medium. -3- Section 10. List of Shareholders. At any meeting of Sharehol ders a list of Shareholders, alphabetically arranged, showing the number and classes of shares held by each on the record date applicable to such meeting, shall be produced on the request of any Shareholder. ARTICLE II Directors Section 1. General Powers. The authority of this Corporation shall be exercised by or under the direction of the Board of Directors, except where the law, the Articles or these Regulations require action to be authorized or taken by the Shareholders. Section 2. Election, Number and Qualification of Directors. 2.1 Election. The Directors shall be elected at the annual meeting of the Shareholders, or if not so elected, at a special meeting of Shareholders called for that purpose. The only candidates who shall be eligible for election at such meeting shall be those who have been nominated by or at the direction of the Board of Directors (which nominations shall be either made at such meeting or disclosed in a proxy statement, or supplement thereto, distributed to Shareholders for such meeting or at the direction of the Board of Directors) and those who have been nominated at such meeting by a Shareholder who has complied with the procedures set forth in this Section 2. A Shareholder may make a nomination for the office of director only if such Shareholder has first delivered or sent by certified mail, return receipt requested, to the Secretary of the Corporation notice in writing at least five and no more than thirty days prior to such meeting of Shareholders, which notice shall set forth or be accompanied by (a) the name and residence of such Shareholder; (b) a representation that such Shareholder is a holder of record of voting stock of the Corporation and intends to appear in person or by proxy at such meeting to nominate the person or persons specified in the notice; (c) the name and residence of each such nominee; and (d) the consent of such nominee to serve as director if so elected. -4- 2.2 Number. The number of Directors, which shall not be less than the lesser of three or the number of Shareholders of record, may be fixed or changed at a meeting of the Shareholders called for the purpose of electing Directors at which a quorum is present, by the affirmative vote of the holders of a majority of the shares represented at the meeting and entitled to vote on such proposal. In addition, the number of Directors may be fixed or changed by action of the Directors at any meeting at which a quorum is present by a majority vote of the Directors present at the meeting. The Directors then in office may fill any Director's office that is created by an increase in the number of Directors. The number of Directors elected shall be deemed to be the number of Directors fixed unless otherwise fixed by resolution adopted at the meeting at which such Directors are elected. 2.3 Qualifications. Directors need not be Shareholders of the Corporation. Section 3. Term of Office of Directors. 3.1 Term. Each Director shall hold office until the next annual meeting of the Shareholders and until his successor has been elected or until his earlier resignation, removal from office, or death. Directors shall be subject to removal as provided by statute or by other lawful procedures and nothing herein shall be construed to prevent the removal of any or all Directors in accordance therewith. 3.2 Resignation. A resignation from the Board of Directors shall be deemed to take effect immediately upon its being received by any incumbent corporate officer other than an officer who is also the resigning Director, unless some other time is specified therein. 3.3 Vacancy. In the event of any vacancy in the Board of Directors for any reason, the remaining Directors, though less than a majority of the whole Board, may fill any such vacancy for the unexpired term. -5- Section 4. Meetings of Directors. 4.1 Regular Meetings. Regular meetings of the Board of Directors shall be held at such times and places as may be fixed by the Directors. 4.2 Special Meetings. Special Meetings of the Board of Directors may be held at any time upon call of the Chairman of the Board, the President, any Vice President, or any two Direc tors. 4.3 Place of Meeting. Any meeting of Directors may be held at such place within or without the State of Ohio as may be designated in the notice of said meeting. 4.4 Notice of Meeting and Waiver of Notice. Notice of the time and place of any regular or special meeting of the Board of Directors shall be given to each Director by personal delivery, telephone, facsimile transmission or mail at least forty-eight hours before the meeting, which notice need not specify the purpose of the meeting. Section 5. Quorum and Voting. At any meeting of Directors, not less than one-half of the whole authorized number of Directors is necessary to constitute a quorum for such meeting, except that a majority of the remaining Directors in office shall constitute a quorum for filling a vacancy in the Board. At any meeting at which a quorum is present, all acts, questions, and business which may come before the meeting shall be determined by a majority of votes cast by the Directors present at such meeting, unless the vote of a greater number is required by the Articles or Regulations. Section 6. Committees. 6.1 Appointment. The Board of Directors may from time to time appoint certain of its members to act as a committee or committees in the intervals between meetings of the Board and may -6- delegate to such committee or committees power to be exercised under the control and direction of the Board. Each committee shall be composed of at least three directors unless a lesser number is allowed by law. Each such committee and each member thereof shall serve at the pleasure of the Board. 6.2 Executive Committee. In particular, the Board of Directors may create from its membership and define the powers and duties of an Executive Committee. During the intervals between meetings of the Board of Directors, the Executive Commit tee shall possess and may exercise all of the powers of the Board of Directors in the management and control and the business of the Corporation to the extent permitted by law. All action taken by the Executive Committee shall be reported to the Board of Directors at its first meeting thereafter. 6.3 Committee Action. Unless otherwise provided by the Board of Directors, a majority of the members of any committee appointed by the Board of Directors pursuant to this Section shall constitute a quorum at any meeting thereof and the act of a majority of the members present at a meeting at which a quorum is present shall be the act of such committee. Any such committee shall prescribe its own rules for calling and holding meetings and its method of procedure, subject to any rules prescribed by the Board of Directors, and shall keep a written record of all action taken by it. Section 7. Action of Directors Without a Meeting. Any action which may be taken at a meeting of Directors or any committee thereof may be taken without a meeting if authorized by a writing or writings signed by all the Directors or all of the members of the particular committee, which writing or writings shall be filed or entered upon the records of the Corporation. -7- Section 8. Compensation of Directors. The Board of Directors may allow compensation to directors for performance of their duties and for attendance at meetings or for any special services, may allow compensation to members of any committee, and may reimburse any Director for his expenses in connection with attending any Board or committee meeting. Section 9. Relationship with Corporation. Directors shall not be barred from providing professional or other services to the Corporation. No contract, action or transaction shall be void or voidable with respect to the Cor poration for the reason that it is between or affects the Corpora tion and one or more of its Directors, or between or affects the Corporation and any other person in which one or more of its Directors are directors, trustees or officers or have a financial or personal interest, or for the reason that one or more inter ested Directors participate in or vote at the meeting of the Directors or committee thereof that authorizes such contract, action or transaction, if in any such case any of the following apply: 9.1 the material facts as to the Director's relationship or interest and as to the contract, action or transaction are disclosed or are known to the Directors or the committee and the Directors or committee, in good faith, reasonably justified by such facts, authorize the contract, action or transaction by the affirmative vote of a majority of the disinterested Directors, even though the disinterested Directors constitute less than a quorum; 9.2 the material facts as to the Director's relationship or interest and as to the contract, action or transaction are disclosed or are known to the shareholders entitled to vote thereon and the contract, action or transaction is specifically approved at a meeting of the shareholders held for such purpose by the affirmative vote of the holders of shares entitling them to exercise a majority of the voting power of the Corporation held by persons not interested in the contract, action or transaction; or -8- 9.3 the contract, action or transaction is fair as to the Corporation as of the time it is authorized or approved by the Directors, a committee thereof or the shareholders. Section 10. Attendance at Meetings of Persons Who Are Not Directors Unless waived by a majority of Directors in attendance, not less than twenty-four (24) hours before any regular or special meeting of the Board of Directors, any Director who desires the presence at such meeting of a person who is not a Director shall so notify all other Directors, request the presence of such person at the meeting, and state the reason in writing. Such person will not be permitted to attend the Directors' meeting unless a majority of the Directors in attendance vote to admit such person to the meeting. Such vote shall constitute the first order of business for any such meeting of the Board of Directors. Such right to attend, whether granted by waiver or vote, may be revoked at any time during any such meeting by the vote of a majority of the Directors in attendance. ARTICLE III Officers Section 1. General Provisions. The Board of Directors shall elect a President, a Secretary and a Treasurer, and may elect a Chairman of the Board, a Chief Executive Officer, one or more Vice Presidents, and such other officers and assistant officers as the Board may from time-to- time deem necessary. The Chairman of the Board, if any, shall be a Director, but none of the other officers need be a Director. Any two or more offices may be held by the same person, but no officer shall execute, acknowledge or verify any instrument in more than one capacity if such instrument is required to be executed, acknowledged or verified by two or more officers. -9- Section 2. Powers and Duties. All officers, as between themselves and the Corporation, shall respectively have such authority and perform such duties as are customarily incident to their respective offices, and as may be specified from time to time by the Board of Directors, regard less of whether such authority and duties are customarily inci dent to such office. The Chief Executive Officer shall also serve either as Chairman of the Board or President and shall have plenary power over the business and activities of the Corporation and over its officers and employees, subject, however, to the control of the Board of Directors and any limitations thereon contained in these Regulations. In the absence of any officer of the Cor poration, or for any other reason the Board of Directors may deem sufficient, the powers or duties of such officer, or any of them may be delegated to any other officer or to any Director. The Board of Directors may from time to time delegate to any officer authority to appoint and remove subordinate officers and to pre scribe their authority and duties. Section 3. Term of Office and Removal. 3.1 Term. Each officer of the Corporation shall hold office at the pleasure of the Board of Directors. 3.2 Removal. The Board of Directors may remove any officer at any time with or without cause by the affirmative vote of a majority of Directors in office. Section 4. Compensation of Officers. The Directors shall establish the compensation of officers and employees or may, to the extent not prohibited by law, delegate such authority to one or more officers or Directors as they determine. -10- ARTICLE IV Indemnification Section 1. Right to Indemnification. Each person who was or is made a party or is threatened to be made a party to or is otherwise involved (including, without limitation, as a witness) in any actual or threatened action, suit, or proceeding, whether civil, criminal, administrative, or investigative (hereinafter a "proceeding"), by reason of the fact that he or she is or was a director or officer of the Corporation or that, being or having been such a director or officer of the Corporation, he or she is or was serving at the request of an executive officer of the Corporation as a director, officer, partner, employee, or agent of another corporation or of a partnership, joint venture, trust, limited liability company, or other enterprise, including service with respect to an employee benefit plan (hereinafter an "indemnitee"), whether the basis of such proceeding is alleged action in an official capacity as such a director, officer, partner, employee, or agent, shall be indemnified and held harmless by the Corporation to the fullest extent permitted by the General Corporation Law of Ohio, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader indemnification rights than permitted prior thereto), or by other applicable law as then in effect, against all expense, liability, and loss (including, without limitation, attorneys' fees, costs of investigation, judgments, fines, excise taxes or penalties arising under the Employee Retirement Income Security Act of 1974 ("ERISA") or other federal or state acts) actually incurred or suffered by such indemnitee in connection therewith and such indemnification shall continue as to an indemnitee who has ceased to be a director, officer, employee, or agent and shall inure to the benefit of the indemnitee's heirs, executors, and administrators. Except as provided in Section 2 with respect to proceedings seeking to enforce rights to indemnification, the Corporation shall indemnify any such indemnitee in connection with a proceeding (or part thereof) initiated by such indemnitee only if such proceeding (or part thereof) was authorized or ratified by the Board of Directors of the Corporation. -11- The right to indemnification conferred in this Section 1 shall be a contract right and shall include the right to be paid by the Corporation the expenses incurred in defending any such proceeding in advance of its final disposition (hereinafter an "advancement of expenses"). An advancement of expenses incurred by an indemnitee in his or her capacity as a director, officer or employee (and not in any other capacity in which service was or is rendered by such indemnitee including, without limitation, service to an employee benefit plan) shall be made only upon delivery to the Corporation of an undertaking, by or on behalf of such indemnitee to repay all amounts so advanced if it is proved by clear and convincing evidence in a court of competent jurisdiction that his omission or failure to act involved an act or omission undertaken with deliberate intent to cause injury to the Corporation or undertaken with reckless disregard for the best interests of the Corporation. An advancement of expenses shall not be made if the Corporation's Board of Directors makes a good faith determination that such payment would violate applicable law. Section 2. Right of Indemnitee to Bring Suit. If a claim under Section 1 is not paid in full by the Corporation within thirty days after a written claim has been received by the Corporation, except in the case of a claim for an advancement of expenses, in which case the applicable period shall be twenty days, the indemnitee may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim. If successful in whole or in part in any such suit, or in a suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the indemnitee shall also be entitled to be paid the expense of prosecuting or defending such suit. The indemnitee shall be presumed to be entitled to indemnification under this Article IV upon submission of a written claim (and, in an action brought to enforce a claim for an advancement of expenses, where the required undertaking has been tendered to the Corporation), and thereafter the Corporation shall have the burden of proof to overcome the presumption that the indemnitee is not so entitled. Neither the failure of the Corporation (including its Board of Directors, independent legal counsel, or its shareholders) to -12- have made a determination prior to the commencement of such suit that indemnification of the indemnitee is proper in the circumstances, nor an actual determination by the Corporation (including its Board of Directors, independent legal counsel or its shareholders) that the indemnitee is not entitled to indemnification shall be a defense to the suit or create a presumption that the indemnitee is not so entitled. Section 3. Nonexclusivity and Survival of Rights. The rights to indemnification and to the advancement of expenses conferred in this Article IV shall not be exclusive of any other right which any person may have or hereafter acquire under any statute, provisions of the Articles of Incorporation, Code of Regulations, agreement, vote of shareholders or disinterested directors, or otherwise. Notwithstanding any amendment to or repeal of this Article IV, or of any of the procedures established by the Board of Directors pursuant to Section 6, any indemnitee shall be entitled to indemnification in accordance with the provisions hereof and thereof with respect to any acts or omissions of such indemnitee occurring prior to such amendment or repeal. Without limiting the generality of the foregoing paragraph, the rights to indemnification and to the advancement of expenses conferred in this Article IV shall, notwithstanding any amendment to or repeal of this Article IV, inure to the benefit of any person who otherwise may be entitled to be indemnified pursuant to this Article IV (or the estate or personal representative of such person) for a period of six years after the date such person's service to or in behalf of the Corporation shall have terminated or for such longer period as may be required in the event of a lengthening in the applicable statute of limitations. Section 4. Insurance, Contracts, and Funding. The Corporation may maintain insurance, at its expense, to protect itself and any director, officer, employee, or agent of the Corporation or another corporation, partnership, joint -13- venture, trust, or other enterprise against any expense, liability, or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability, or loss under the General Corporation Law of Ohio. The Corporation may enter into contracts with any indemnitee in furtherance of the provisions of this Article IV and may create a trust fund, grant a security interest, or use other means (including, without limitation, a letter of credit) to ensure the payment of such amounts as may be necessary to effect indemnification as provided in this Article IV. Section 5. Indemnification of Employees and Agents of the Corporation. The Corporation may, by action of its Board of Directors, authorize one or more executive officers to grant rights to advancement of expenses to employees or agents of the Corporation on such terms and conditions no less stringent than provided in Section 1 hereof as such officer or officers deem appropriate under the circumstances. The Corporation may, by action of its Board of Directors, grant rights to indemnification and advancement of expenses to employees or agents or groups of employees or agents of the Corporation with the same scope and effect as the provisions of this Article IV with respect to the indemnification and advancement of expenses of directors and officers of the Corporation; provided, however, that an undertaking shall be made by an employee or agent only if required by the Board of Directors. Section 6. Procedures for the Submission of Claims. The Board of Directors may establish reasonable procedures for the submission of claims for indemnification pursuant to this Article IV, determination of the entitlement of any person thereto, and review of any such determination. Such procedures shall be set forth in an appendix to these Code of Regulations and shall be deemed for all purposes to be a part hereof. -14- ARTICLE V Amendments This Code of Regulations may be amended by the affirmative vote or the written consent of the Shareholders entitled to exercise a majority of the voting power on such proposal. If an amendment is adopted by written consent the Secretary shall mail a copy of such amendment to each Shareholder who would be entitled to vote thereon and did not participate in the adoption thereof. This Code of Regulations may also be amended by the affirmative vote of a majority of the directors to the extent permitted by Ohio law at the time of such amendment. -15- EX-10 5 EXHIBIT 10(B) FORM OF STOCK OPTION AGR FORM 5 [Outside Director] AMERICAN PREMIER GROUP, INC. STOCK OPTION AGREEMENT Subject and pursuant to the provisions of the American Premier Group, Inc. Stock Option Plan (the "Plan"), __________________________________ (the "Optionee") is hereby granted the option (the "Option") to purchase _______________ _________________________ (________) fully paid and non-assessable shares of Common Stock, $1.00 par value (the "Shares"), of American Premier Group, Inc., an Ohio corporation (the "Company"), upon and subject to the following terms and conditions: 1. Option Price. The price at which each Share may be purchased pursuant to the Option is $_______ per share. 2. Duration of Option. Except as otherwise provided herein, the Option shall expire, and all rights to purchase Shares pursuant thereto shall cease, on the third day after the tenth anniversary of the date of grant of the Option (the "Expiration Date"), as set forth below. 3. Designation as Non-Incentive Option. The Option is designated a "Non-Incentive Option" (which term, as used herein, shall mean an option not intended to be an "incentive stock option" within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the "Code")). 4. Vesting of Option. The Option is fully exercisable and vested as of the date on which the Option was granted. 5. Merger, Consolidation, Etc. In the event that the Company shall, pursuant to action by its Board of Directors, at any time propose to merge into, consolidate with, or sell or otherwise transfer all or substantially all of its assets to another corporation and provision is not made pursuant to the terms of such transaction for the assumption by the surviving, resulting or acquiring corporation of the Option, or for the substitution of a new option therefor, a committee of the Board of Directors designated by the Board of Directors (the "Committee") shall cause written notice of the proposed transaction to be given to the Optionee not less than 40 days prior to the anticipated effective date of the proposed transaction, and, prior to a date specified in such notice, which shall be not more than 10 days prior to the anticipated effective date of the proposed transaction, the Optionee shall have the right to exercise the Option to purchase any or all Shares then subject to the Option, including those, if any, which by reason of other provisions of the Option have not then become available for purchase. The Optionee, by so notifying the Company in writing, may, in exercising the Option, condition such exercise upon, and provide that such exercise shall become effective at the time of, but immediately prior to, the consummation of the transaction, in which event the Optionee need not make payment for the Shares to be purchased upon exercise of the Option until 5 days after written notice by the Company to the Optionee that the transaction has been consummated. If the transaction is consummated, the Option, to the extent not previously exercised prior to the date specified in the foregoing notice, shall terminate on the effective date of such consummation. If the transaction is abandoned, any Shares not purchased upon exercise of the Option shall continue to be available for purchase in accordance with the other provisions of the Option. 6. Exercise of Option. A person entitled to exercise the Option may exercise it in whole at any time, or in part from time to time, by delivering to the Secretary of the Company written notice specifying the number of Shares with respect to which the Option is being exercised, together with payment in full of the purchase price of such Shares plus any applicable federal, state or local taxes for which the Company (or a Subsidiary (as defined below)) has a withholding obligation in connection with such exercise. Such payment shall be made in whole or in part: (i) in cash or by personal check, money market check, certified check, or bank draft to the order of the Company, (ii) by the exchange of Common Stock of the Company acquired by the person entitled to exercise the Option more than 6 months prior to the date of exercise and having a "fair market value" on the date of exercise at least equal to the price for which the Shares may be purchased pursuant to the Option plus any applicable federal, state or local taxes for which the Company (or a Subsidiary) has a withholding obligation as noted above (including any such taxes with respect to income recognized by the Optionee upon the disposition of the Common Stock of the Company used to effect such exchange) or (iii) by a promissory note payable to the Company, but only in accordance with the provisions of, and if the Optionee is at the time of exercise otherwise eligible under, the Company's Stock Option Loan Program, or any successor program, as in effect from time to time (the "Loan Program"), (a) in a principal amount up to 100% of the payment or such applicable lower percentage as may be specified by the Committee pursuant to the Loan Program and (b) bearing interest at a rate not less than the applicable test rate prescribed under Section 483 of the Code, or any successor provision, or such higher rate as may be specified by the Committee pursuant to the Loan Program. Notwithstanding the foregoing, the Committee may, in its sole discretion, authorize such payment, in whole or in part, in any other form. As used -2- herein, the term "Subsidiary" means any domestic or foreign corporation, at least 50% of the outstanding voting stock or voting power of which is beneficially owned, directly or indirectly, by the Company. The "fair market value" of the Shares on any date shall be the mean between the high and low prices of the Shares on such date on the New York Stock Exchange Composite Tape (or the principal market in which the Shares are traded, if the Shares are not listed on that Exchange on such date), or if the Shares were not traded on such date, the mean between the high and low prices of the Shares on the next preceding trading day during which the Shares were traded. 7. Nontransferability. The Option shall not be transferable other than by will or the laws of descent and distribution or pursuant to a qualified domestic relations order as defined by the Code or Title I of the Employee Retirement Income Security Act of 1974, as amended, or the rules thereunder. Options may be exercised, during the lifetime of the Optionee, only by the Optionee. 8. Termination of Service. In the event of the Optionee's termination of service as a member of the Board of Directors for any reason, the Option shall terminate on (i) the date which is the later of (a) 90 days from the date of such termination of service or (b) six months and ten days after such Optionee's last purchase or sale of Shares prior to his or her ceasing to be a member of the Board of Directors or (ii) its Expiration Date, whichever shall first occur. 9. No Rights as Stockholder. The Optionee shall not have any rights as a stockholder of the Company with respect to any Shares prior to the date of issuance to the Optionee of the certificate or certificates for such Shares. 10. Issuance of Shares; Restrictions. (i) Subject to the conditions and restrictions provided in this Paragraph 10, the Company shall, within twenty business days after the Option has been duly exercised in whole or in part, deliver to the person who exercised the Option a certificate, registered in the name of such person, for the number of Shares with respect to which the Option has been exercised. The Company may legend any stock certificate issued hereunder to reflect any restrictions provided for in this Paragraph 10. (ii) Unless the Shares subject to the Option have been registered under the Securities Act of 1933, as amended (the "Act"), (and, if the Optionee may be deemed an "affiliate" of the Company as defined in Rule 405 under the Act, such Shares have been registered under the Act for resale by the Optionee), or the Company has determined that an exemption from registration is available, the Company may require prior to and as a condition of -3- the issuance of any Shares that the person exercising the Option furnish the Company with a written representation in a form prescribed by the Committee to the effect that such person is acquiring such Shares solely with a view to investment for such person's own account and not with a view to the resale or distribution of all or any part thereof, and that such person will not dispose of any such Shares otherwise than in accordance with the provisions of Rule 144 under the Act unless and until either the Shares are registered under the Act or the Company is satisfied that an exemption for such registration is available. (iii) Anything contained herein to the contrary notwithstanding, the Company shall not be obligated to sell or issue any Shares pursuant to the Option unless and until the Company is satisfied that such sale or issuance complies with (a) all applicable requirements of the New York Stock Exchange (or the governing body of the principal market in which such Shares are traded, if such Shares are not then listed on that Exchange), (b) all applicable provisions of the Act and (c) all other laws or regulations by which the Company is bound or to which the Company is subject. 11. Adjustments. The number of Shares and the Option price for Shares covered by the Option shall be proportionately adjusted for any increase or decrease in the number of issued Shares resulting from any stock dividend, stock split or similar event, any other capital adjustment (including a reclassification of Shares or recapitalization or reorganization of the Company), or the distribution to holders of Shares of rights, warrants, assets or evidences of indebtedness (other than regular cash dividends) in such manner as the Committee in its sole judgment determines to be equitable. 12. Optionee Acknowledgement. Optionee acknowledges receipt of a copy of the Plan, as amended. Optionee hereby agrees to accept as final and conclusive all determinations, interpretations and constructions made by the Committee pursuant to the Plan and the Option. -4- Date of Grant: June 1, ______ (Corporate Seal) AMERICAN PREMIER GROUP, INC. Attest: By__________________________ Robert W. Olson Senior Vice President and Secretary _________________________ Pamela S. Meyers Assistant Secretary ____________________________ Optionee -5- EX-10 6 EXHIBIT 10(C) STOCK OPTION LOAN PROGRAM AMERICAN FINANCIAL GROUP, INC. STOCK OPTION LOAN PROGRAM Adopted on January 26, 1984, as amended March 28, 1985, February 8, 1991 and April 3, 1995 AMERICAN FINANCIAL GROUP, INC. STOCK OPTION LOAN PROGRAM 1. Purpose The purpose of the Stock Option Loan Program (the "Loan Prog ram") is to assist in the exercise of options granted under the American Financial Group, Inc. (the "Company") Stock Option Plan (the "Plan"). Consistent with this purpose, the Loan Program aut horizes the Company to make loans to certain participants in the Plan on the terms and conditions hereinafter set forth. Unless otherwise defined herein, terms defined in the Plan shall have the same meaning herein as in the Plan. 2. Administration The Loan Program shall be administered by the Compensation Committee or a successor committee or subcommittee (the "Commit tee") of the Board of Directors of the Company (the "Board"). Subject to the express provisions of the Loan Program, the Committee shall have exclusive power to determine those individu als who shall be eligible to participate in the Loan Program and the terms and conditions to which loans under the Loan Program (the "Loans") may be subject. Subject again to the express provisions of the Loan Program, the Committee shall have full and final authority to interpret the Loan Program and establish, adopt or revise such rules and regulations and to make all determinations relating to the Loan Program as it may, from time to time, deem necessary or advisable for the administration of the Loan Program. The Committee's interpretation of the Loan Program and all of its actions and decisions with respect to the Loan Program shall be final, binding and conclusive on all par ties. 3. Options For Which Loan Program Is Available The Loan Program shall be available in connection with the exercise by Eligible Participants (as defined in Paragraph 4 hereof) of all Incentive Options granted on or after January 26, 1984 and all Non-Incentive Options, regardless of the date of grant. 4. Eligible Participants Eligible Participants shall be Employees and directors of the Company who are Participants in the Plan as such Eligible Participants may be limited from time to time by the Committee. The term "Employee" shall mean any person (including any officer) employed by the Company or a Subsidiary on a full-time salaried basis. The term "Subsidiary" shall mean any corporation a majori ty of the outstanding voting stock or voting power of which is beneficially owned directly or indirectly by the Company. The term "Participant" shall mean an Eligible Participant who obtains a Loan pursuant to this Loan Program. -2- 5. Terms and Conditions of Loans Each Loan shall be evidenced by a written secured promissory note (a "Note") from the Participant payable to the order of the Company in such form as shall comply with the applicable terms and conditions of the Loan Program. In addition, any Note may include or contain other terms and conditions that are not incon sistent with the provisions of the Loan Program. (a) Timing and Amount of Loan Except as otherwise provided in the last sentence of this subparagraph (a), an Eligible Participant may obtain a Loan only at the time of, and in connection with, the exercise of an Option for which the Loan Program is avail able, as described in Paragraph 3 hereof. An Eligible Participant may borrow up to 95% of the purchase price of the Shares with respect to which the Option is being exer cised and up to 100% of the applicable federal, state or local taxes for which the Company (or a Subsidiary) has a withholding obligation in connection with such exercise, and proceeds of the Loan may be used only for such purposes. An Eligible Participant may obtain a Loan at a time subsequent to the time of exercise of an Option for the purpose of satisfying any applicable taxes for which there is a with holding obligation which arises at such subsequent time rather than at the time of exercise. (b) Interest Rate and Payments Each Note shall accrue and bear interest compound ed on each June 30 and December 31 at a rate per annum equal to: (i) except as otherwise provided in clauses (ii) and (iii) of this subparagraph (b), the rate per annum publicly announced from time to time by Chemical Bank, New York, New York, as the prime rate in effect for 90-day loans to prime commer cial customers as such prime rate is in effect at the beginning of each such quarter, provided, however, that such interest rate shall in no case be less than the test rate prescribed under Sec tions 483, 1274 or 7872 of the United States In ternal Revenue Code (the "Code"), if applicable, or any successor provisions; (ii) if the Loan was obtained in connection with the exercise of an Incentive Option granted on or after February 8, 1991 or a Non-Incentive Option, the applicable short-term or mid-term federal rate for loans compounded semiannually in effect under Section 7872 of the Code, or any successor provi sion, as of the date of the Loan; -3- (iii) if the Loan was outstanding on February 8, 1991, the applicable short-term federal rate for loans compounded semiannually in effect under section 7872 of the Code as of February 8, 1991. Interest shall be payable at the same time as the principal of the Note shall be payable. (c) Term of Loan Each Loan shall become due and payable upon the first to occur of any of the following events: (i) (x) except as otherwise provided in clause (y) of this clause (i) of this subparagraph (c), the day of the eighteenth month after the date of the Loan which corresponds to the date of the Loan (or if such month does not have a corre sponding day, then on the last day of such eighteenth month); (y) if the Loan was obtained in connection with the exercise of an Incentive Option granted on or after February 8, 1991 or a Non-Incentive Option or if the Loan was outstanding on February 8, 1991, the day of the sixtieth month (or any shorter period of months not less than six that may be specified by the Participant) after the date of the Loan (or if such month does not have a corresponding day, then on the last day of such month); (ii) failure of the Participant to maintain a margin of collateral pledged with the Company, consisting of the Shares, the purchase of which is being financed by the Loan to the Participant (or other collateral acceptable to a financial officer of the Company), sufficient to cause the Loan (including the accrued and unpaid interest thereon to the end of the most recent calendar quarter of a year) not to exceed 95% of the value of the pledged collateral, or such other ratio of the Loan and the interest thereon to the value of the collateral as may be required by any law, rule or regulation of the United States, any state, or any federal or state board, commission, agency or service; (iii) the voluntary bankruptcy or insolvency of the Participant (or admission thereof by the Par ticipant), or the seeking of relief by the Partic ipant under a statute for the relief of debtors, or the failure of the Participant promptly to cause the discharge of a creditor action brought against the Participant under the Bankruptcy Code or other bankruptcy or insolvency law; -4- (iv) thirty (30) days after the termination of the employment of the Participant as an employee of the Company or a Subsidiary of the Company, or thirty (30) days after the Participant ceases to be a director of the Company, unless the Committee authorizes the extension of such thirty (30) day period; provided, however, that if (x) the Partic ipant is a former director or officer of the Com pany subject to the provisions of Section 16(a) of the Securities Exchange Act of 1934 and (y) the Loan was obtained in connection with the exercise of an Incentive Option granted on or after March 28, 1985 or a Non-Incentive Option, such Loan shall become due and payable on the date which is the later of 30 days from the date of such termi nation of employment or six (6) months and ten (10) days after such director's or officer's last purchase or sale of Shares prior to his ceasing to be such a director or officer; further, provided that (a) transfer of employment of an employee between the Company and a Subsidiary or between Subsidiaries of the Company shall not constitute a termination of employment, (b) the Committee may determine whether a leave of absence is for the purpose of the Loan a termination of employment and (c) in the event of the death of a Participant while employed by the Company or a Subsidiary, or while serving as a director of the Company, the personal representative of the Participant will be afforded a period of time (to be specified in the Note) in which to assume the obligations provided for in the Note, and upon such assumption the payment date of the Loan will not be accelerated by reason of the death of the Participant; or (v) failure of the Participant to observe or perform any other provision of the Note applicable to it. (d) Pledge of Shares The Shares purchased upon exercise of the Option with respect to which the Loan is made shall be pledged by the Pa rticipant to the Company in order to secure the payment of the principal of and interest on the Loan including any taxes required to be withheld by the Company. The Partici pant shall be entitled to all dividends and distributions which may be paid on the Shares (except that dividends payable in stock of the Company shall be retained by the Company and pledged to secure the Loan) and to all voting rights with respect to such Shares. The Company may place a legend on any Share certificate to reflect any restrictions provided for in this Loan Program. -5- (e) Prepayment The Loan may be prepaid in whole or in part by the Par ticipant at any time and pledged Shares shall be released from pledge in approximate proportion to the amount of the Loan prepaid except to the extent that the retention of Shares by the Company is necessary to maintain the required ratio of the value of the pledged Shares to the unpaid amount of the Loan and the accrued interest thereon. (f) Default In the event, the Participant shall fail to pay any amount due under the terms of the Note including any amount becoming due and payable by acceleration of its payment date, the Company upon giving notice to the Participant may sell the pledged Shares (or other pledged collateral) and shall be entitled to deduct from the proceeds its costs and expenses of enforcing payment of the Note and liquidation of the collateral, the unpaid interest on the Note and the unpaid principal of the Note before remitting the balance to the Participant. In the event, the liquidation of the pledged collateral shall not provide funds sufficient to pay the entire unpaid principal of and interest on the Note and the costs and expenses of enforcing payment of the Note, the Participant shall be liable to the Company for the amount of such deficiency. 6. Miscellaneous (a) Government and Other Regulations The obligation of the Company to make Loans to Eligible Participants, and each Loan made to an Eligible Participant, shall be subject to all applicable laws, rules and regula tions and to any required approvals by governmental agen cies. (b) No Employment Rights Neither this Loan Program nor any action taken hereun der shall be construed as conferring on any Employee any rig ht to continue in the employ of the Company or a Subsidiary or affect in any way the right of the Company or a Subsidiary to terminate the employment of any Employee at any time. (c) Nontransferability A Participant's rights and interests under the Loan Program may not be assigned, pledged or transferred except that in the event of the death of a Participant, while an employee or director, the personal representative may assume and succeed to the rights and obligations of the Partici pant. -6- (d) Applicable Law The Loan Program and all other governing documents, agreements and instruments and all actions taken hereunder shall be governed by the laws of the State of New York. 7. Amendment and Termination The Board may at any time terminate the Loan Program. The Board or Committee may at any time, or from time to time, amend or suspend and, if suspended reinstate, the Loan Program in whole or in part. Notwithstanding the foregoing, the Loan Program shall continue in effect to the extent necessary to settle all matters relating to Loans made prior to any such termination or suspension. -7- EX-10 7 EXHIBIT 10(D) BONUS PLAN AMERICAN FINANCIAL CORPORATION ANNUAL BONUS PLAN Adopted on January 17, 1996 AMERICAN FINANCIAL CORPORATION ANNUAL BONUS PLAN 1. PURPOSE The purpose of the Annual Bonus Plan (the "Plan") is to further the profitability of American Financial Corporation, and its subsidiaries and affiliates (the "Company") to the benefit of the shareholders of the Company by providing incentive to the Plan participants. 2. ADMINISTRATION Except as otherwise expressly provided herein, the Plan shall be administered by the Compensation Committee or a successor committee or subcommittee (the "Committee") of the Board of Directors of the Company (the "Board") composed solely of two or more "outside directors" as defined pursuant to Section 162(m) of the Internal Revenue Code. No member of the Committee while serving as such shall be eligible to be granted a bonus under the Plan. Subject to the provisions of the Plan (and to the approval of the Board where specified in the Plan), the Committee shall have exclusive power to determine the conditions (including performance requirements) to which the payment of the bonuses may be subject and to certify that performance goals are attained. Subject to the provisions of the Plan, the Committee shall have the authority to interpret the Plan and establish, adopt or revise such rules and regulations and to make all determinations relating to the Plan as it may deem necessary or advisable for the administration of the Plan. The Committee's interpretation of the Plan and all of its actions and decisions with respect to the Plan shall be final, binding and conclusive on all parties. 3. PLAN TERM AND BONUS YEARS The term of the Plan is one year, commencing January 1, 1996, which term shall be renewed from year to year unless and until the Plan shall be terminated or suspended as provided in Section 9. As used in the Plan the term "Bonus Year" shall mean a calendar year. 4. PARTICIPATION Subject to the approval of the Committee and the Board of Directors (based on the recommendation of the Committee), management of the Company shall suggest those persons who are deemed to be key employees of the Company for participation in the Plan (the "Participants"). 5. ESTABLISHMENT OF INDIVIDUAL BONUS TARGETS AND PERFORMANCE CRITERIA The Committee shall establish the individual target amount of bonus (the "Bonus Target") that may be awarded to each Participant and recommend that the Board adopt such action. In no event shall the establishment of any Participant's Bonus Target give a Participant any right to be paid all or any part of such amount unless and until a bonus is actually awarded pursuant to Section 6. The Committee shall establish the performance criteria (the "Performance Criteria") that will apply to the determination of each Participant's bonus for that Bonus Year and recommend that the Board adopt such action. The individuals, their Bonus Targets and Performance Criteria set forth on Schedules I and II have been recommended by the Committee and approved by the Board. 6. DETERMINATION OF BONUSES AND TIME OF PAYMENT As soon as practicable after the end of 1996, the Committee shall certify whether or not the performance criteria of each Participant has been attained and shall recommend to the Board, and the Board shall determine, the amount of the bonus, if any, to be awarded to each Participant for 1996 according to the terms of this Plan. Such bonus determinations shall be based on achievement of the Performance Criteria for 1996. Once the bonus is so determined for a Participant, it shall be paid seventy-five percent in cash and twenty-five percent in Company Common Stock to the Participant (less any applicable withholding and employment taxes) as soon as practicable. The number of shares of Company Common Stock to be issued to a Participant shall be determined by dividing twenty-five percent of the bonus payable (before applicable taxes and deductions) by the average of the per share Fair Market Value of the Common Stock for the last twenty trading days of 1996; the resulting number shall then be rounded to the nearest hundred. "Fair Market Value" means the last sale price reported on any stock exchange or over-the-counter trading system on which Company Common Stock is trading on the last trading day prior to a specified date or, if no last sales price is reported, the average of the closing bid and asked prices for a share of Common Stock on a specified date. If no sale has been made on any date, then prices on the last preceding day on which any such sale shall have been made be used in determining Fair Market Value under either method prescribed in the previous sentence. -2- 7. TERMINATION OF EMPLOYMENT If a Participant's employment with the Company or a subsidiary, as the case may be, is terminated for any reason other than discharge for cause, he may be entitled to such bonus, if any, as the Committee, in its sole discretion, may determine. In the event of a Participant's discharge for cause from the employ of the Company or a Subsidiary, as the case may be, he shall not be entitled to any amount of bonus unless the Committee, in its sole discretion, determines otherwise. 8. MISCELLANEOUS A. Government and Other Regulations. The obligation of the Company to make payment of bonuses shall be subject to all applicable laws, rules and regulations and to such approvals by governmental agencies as may be required. B. Tax Withholding. The Company or a Subsidiary, as appropriate, shall have the right to deduct from all bonuses paid in cash any federal, state or local taxes required by law to be withheld with respect to such cash payments. C. Claim to Bonuses and Employment Rights. The designation of persons to participate in the Plan shall be wholly at the discretion of the Board. Neither this Plan nor any action taken hereunder shall be construed as giving any Participant any right to be retained in the employ of the Company or a Subsidiary. D. Beneficiaries. Any bonuses awarded under this Plan to a Participant who dies prior to payment shall be paid to the beneficiary designated by the Participant on a form filed with the Company. If no such beneficiary has been designated or survives the Participant, payment shall be made to the Participant's legal representative. A beneficiary designation may be changed or revoked by a Participant at any time provided the change or revocation is filed with the Company. E. Nontransferability. A person's rights and interests under the Plan may not be assigned, pledged or transferred except, in the event of a Participant's death, to his designated beneficiary as provided in the Plan or, in the absence of such designation, by will or the laws of descent and distribution. -3- F. Indemnification. Each person who is or shall have been a member of the Committee or of the Board shall be indemnified and held harmless by the Company (to the extent permitted by the Articles of Incorporation and Code of Regulations of the Company and applicable law) against and from any loss, cost, liability or expense that may be imposed upon or reasonably incurred by him in connection with or resulting from any claim, action, suit or proceeding to which he may be a party or in which they may be involved by reason of any action taken or failure to act under the Plan and against and from any and all amounts paid by him in settlement thereof, with the Company's approval, or paid by him, in satisfaction of judgment in any such action, suit or proceeding against him. He shall give the Company an opportunity, at its own expense, to handle and defend the same before he undertakes to handle and defend it on his own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such person may be entitled under the Company's Articles of Incorporation or Code of Regulations, as a matter of law or otherwise or of any power that the Company may have to indemnify him or hold him harmless. G. Reliance on Reports. Each member of the Committee and each member of the Board shall be fully justified in relying or acting in good faith upon any report made by the independent certified public accountants of the Company or of its Subsidiaries or upon any other information furnished in connection with the Plan by any officer or director of the Company or any of its Subsidiaries. In no event shall any person who is or shall have been a member of the Committee or of the Board be liable for any determination made or other action taken or any omission to act in reliance upon any such report or information or for any action taken, including the furnishing of information, or failure to act, if in good faith. H. Expenses. The expenses of administering the Plan shall be borne by the Company and its Subsidiaries in such proportions as shall be agreed upon by them from time to time. I. Pronouns. Masculine pronouns and other words of masculine gender shall refer to both men and women. J. Titles and Headings. The titles and headings of the sections in the Plan are for convenience of reference only, and, in the event of any conflict between any such title or heading and the text of the Plan, such text shall control. -4- 9. AMENDMENT AND TERMINATION The Board may at any time terminate the Plan. The Board may at any time, or from time to time, amend or suspend and, if suspended, reinstate the Plan in whole or in part. Notwithstanding the foregoing, the Plan shall continue in effect to the extent necessary to settle all matters relating to the payment of bonuses awarded prior to any such termination or suspension. -5- EX-10 8 EXHIBIT 10(E) RETIREMENT PROGRAM FOR OUTSIDE DIRECTORS RESOLVED, that the Corporation hereby adopts the following Retirement Program for Outside Directors: Retirement Program for outside Directors of American Premier Group, Inc. 1. Eligibility Any person (other than an officer or employee of American Premier Group, Inc. (the "Corporation") or any of its subsidiaries) who retires as a director of the Corporation after having met the applicable eligibility requirements set forth in Paragraph 2 shall be entitled to the retirement benefit referred to in Paragraph 3. For purposes of this Retirement Program for Outside Directors, a person's retirement as a director of the Corporation means his resignation as a director of the Corporation or his not being nominated for reelection as a director of the Corporation by the Corporation's shareholders upon the expiration of his term of office as a director of the Corporation. 2. Eligibility Requirements To be eligible for the retirement benefit referred to in Paragraph 3, a person must have served for at least four years as a director of the Corporation (or of American Premier Underwriters, Inc.) while not being an officer or employee of the Corporation or any of its subsidiaries (or of American Premier Underwriters, Inc. or any of its subsidiaries) and must have reached the age of 55. 3. Retirement Benefit Upon retirement as a director of the Corporation, an eligible person will revive an amount equal to five times the annual directors fee in effect at the time of his retirement. The retiring director may elect to receive the benefit in lump sum or in deferred payments. 4. Death Benefit A death benefit equal to the retirement benefit will be paid to the designated beneficiary or estate of any director of the Corporation who dies while in office, whether or not the director was eligible for a retirement benefit at the time of his death. This death benefit, which shall be in lieu of any retirement benefit, shall not be available to a director who at any time during the two years immediately preceding his death, was an officer or employee of the Corporation or any of its subsidiaries. 5. Condition to Receipt of Retirement Benefit As a condition to receipt of the retirement benefit, a director must agree in writing that for a period of 5 years following his retirement (a) he will, without further compensation (except reimbursement for expenses), provide consulting services upon request to the Corporation (such services shall not exceed 10 days per year), (b) he will not, without the permission of the Corporation, engage in significant competition with any major operation of the Corporation and its subsidiaries taken as a whole, or serve on the board of directors of any corporation that is engaged in significant competition with any major operation of the Corporation and its subsidiaries taken as a whole, and (c) he will not disclose any confidential information of the Corporation or any of its subsidiaries, or intentionally engage in any activity causing injury to the Corporation or any of its subsidiaries. -2- EX-10 9 EXHIBIT 10(F) DIRECTORS COMPENSATION AMERICAN FINANCIAL GROUP, INC. DIRECTORS' COMPENSATION PLAN P R E A M B L E The purpose of the Directors' Compensation Plan ("Plan") of American Financial Group, Inc. (the "Company") is to align further the interests of the Company's non-employee directors with the interests of shareholders by providing that a minimum of 50% of such directors' annual retainers are paid through the issuance of shares of the Company's Common Stock, $1.00 par value ("Common Stock"). Directors who are not employees of the Company or a Company subsidiary are paid an annual retainer ("Board Retainer"), an additional annual Board Committee retainer ("Committee Retainer") and an attendance fee for each Board or Committee meeting attended ("Meeting Fees"), in amounts which shall be set by the Board of Directors. The initial amounts established by the Board of Directors for the retainers and fees is set forth on the attached Schedule 1. These amounts may be changed by the Board of Directors from time to time without shareholder approval. 1. PAYMENT OF COMPENSATION TO NON-EMPLOYEE DIRECTORS. The Board Retainer and Committee Retainer shall be paid by the Company quarterly, in arrears, as soon as practicable following the end of each calendar quarter. The quarterly portion of the Board Retainer and Committee Retainer (if applicable) shall be paid 50% in cash and 50%, or in such proportion as an eligible director may elect pursuant to Section 3 below, in the form of shares of the Company's Common Stock. The number of shares of Common Stock to be issued to each non-employee director pursuant to this Plan shall be determined by dividing the amount of the retainers payable in Common Stock by the average of the per share Fair Market Value of the Common Stock (as defined in Section 3 below) for the ten trading days ending on the last business day of each calendar quarter; the resulting number shall then be rounded up to the nearest share. The Meeting Fees accrued during each calendar quarter, if any, shall be paid by the Company at the end of such quarter in cash, together with the cash portion of the applicable quarterly retainers. 2. ELECTION BY NON-EMPLOYEE DIRECTORS TO RECEIVE CASH PORTION OF THEIR COMPENSATION IN ADDITIONAL COMPANY COMMON STOCK. Each non-employee director may elect to receive all or a portion (in 20% increments) of the quarterly cash portion of their applicable retainers for service on the Board of Directors in shares of Common Stock. Such election shall be irrevocable for each quarter and shall be made at least six months in advance of the date the non-employee director is to receive the quarterly payment. 3. FAIR MARKET VALUE OF COMPANY COMMON STOCK. The "Fair Market Value" of a share of Common Stock shall be the mean between the high and low prices of the shares on such date on the New York Stock Exchange Composite Tape (or the principal market in which the Common Stock is traded, if the shares are not listed on that Exchange on such date) or, if the shares were not traded on such date, then the mean between the high and low prices of the shares on the next preceding trading day during which the shares were traded. 4. RESTRICTIVE LEGEND; HOLDING PERIOD FOR SHARES OF COMMON STOCK. In order to comply with certain provisions of the Federal securities laws, including Section 16(b) of the Securities Exchange Act of 1934, all certificates representing shares of Common Stock issued pursuant to the Plan shall bear the following restrictive legend which will prevent the recipient from disposing of such shares for six months from the date of issuance: THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE ASSIGNED UNTIL THE EXPIRATION OF THE SIX MONTH PERIOD BEGINNING ON THE DATE OF ORIGINAL ISSUANCE BY AMERICAN FINANCIAL GROUP, INC. (THE "COMPANY") AS PROVIDED BY SECTION 4 OF THE COMPANY'S DIRECTORS' COMPENSATION PLAN EFFECTIVE AS OF , 1996, A COMPLETE AND CORRECT COPY OF THE FORM OF WHICH WILL BE FURNISHED BY THE COMPANY TO THE HOLDER HEREOF UPON REQUEST. When the legend requirement imposed by this Section shall terminate, the holder of shares of Common Stock for which such legend requirement has terminated may request that the Company (at its expense) promptly issue a replacement certificate representing such shares without such legend. -2- 5. NO RIGHT TO CONTINUANCE AS A DIRECTOR. Neither the action of the Company in establishing the Plan nor the issuance of Common Stock hereunder shall be deemed to create any obligation on the part of the Board of Directors to nominate any non-employee director for reelection by the Company's shareholders or to be evidence of any agreement or understanding, express or implied, that the non-employee director has a right to continue as a director for any period of time or at any particular rate of compensation. 6. SHARES SUBJECT TO THE PLAN. One hundred thousand shares of Common Stock are authorized for issuance under the Plan in accordance with the provisions hereof. The Company shall at all times during the term of the Plan retain as authorized and unissued Common Stock at least the number of shares from time to time required under the provisions of the Plan, or otherwise assure itself of its ability to perform its obligations hereunder. 7. EFFECTIVE DATE AND EXPIRATION OF PLAN. The Plan is subject to approval by a majority of the votes cast at the next Annual Meeting of Shareholders of the Company by the holders of shares of Common Stock entitled to vote thereon, and, if so approved, shall be effective beginning on the first day of the calendar quarter immediately following such vote (the "Effective Date"). Unless earlier terminated by the Board of Directors pursuant to Section 10, the Plan shall terminate on the tenth anniversary of the Effective Date. No shares of Common Stock shall be issued pursuant to the Plan after its termination date. 8. ELECTION TO DEFER DIRECTOR COMPENSATION. a. Any non-employee director may, by delivering a written election to the Secretary of the Company on or before December 31 of any calendar year, elect to defer receipt of all or a specified portion (in 20% increments) of his cash or Common Stock compensation during the calendar year following such election and succeeding calendar years. b. Any person who shall become a non-employee director during any calendar year, and who was not a non-employee director on the preceding December 31, may, before his term begins, elect to defer receipt of all or a specified portion (in 20% increments) of his cash compensation during the balance of such calendar year and for succeeding calendar years. -3- c. A non-employee director's election to defer receipt of compensation shall continue until the date on which such non-employee director ceases to be a director of the Company or until he terminates such election by written notice delivered to the Secretary of the Company. 9. PAYMENT IN EVENT OF DEATH. If a non-employee director dies (before or after his ceasing to be a Company director), any portion of his compensation pursuant to the Plan (whether or not deferred) then unpaid shall be paid to the beneficiaries of the director named in the most recent beneficiary designation filed with the Secretary of the Company. In the absence of such a designation, such compensation shall be paid to, or as directed by, the director's personal representative, in one or more installments as the non-employee director may have elected in writing. 10. AMENDMENT, SUSPENSION AND TERMINATION OF PLAN. The amount, pricing and timing of Company Common Stock issuances pursuant to the Plan shall not be amended more than once every six months, other than to comport with changes in the Internal Revenue Code of 1986, as amended, the Employee Retirement Income Security Act of 1974, as amended, or the rules thereunder. The Board of Directors may suspend or terminate the Plan or any portion of it at any time, and may amend it, subject only to the preceding paragraph, from time to time in such respects as the Board may deem advisable in order that any awards hereunder shall conform to any change in applicable laws or regulations or in any other respect the Board may deem to be in the best interests of the Company; provided, however, that no such amendment shall, without the further approval of the shareholders of the Company by the affirmative vote of shareholders entitled to cast at least a majority of the total number of votes represented at a meeting of shareholders of the Company, increase the number of shares of Common Stock which may be issued under the Plan, materially modify the requirements as to eligibility for participating in the Plan, or extend the termination date of the Plan. -4- SCHEDULE 1 Annual Board Retainer $40,000 Annual Board Committee Retainer $12,000 Attendance Fee per Meeting $ 1,000 -5- EX-10 10 EXHIBIT 10(G) SEVERANCE AGREEMENT THE PENN CENTRAL CORPORATION TRANSITION/RETENTION AND SEVERANCE ARRANGEMENTS FOR NEIL M. HAHL, V.P. - ACCOUNTING AND TAXES TERM SHEET I. Transition/Retention Bonus: Provided that an Eligible Executive remains continuously employed by The Penn Central Corporation ("PCC") or a PCC subsidiary company or a successor to PCC or a PCC subsidiary company until March 31, 1988, or, if earlier, his involuntary termination of employment, other than for Cause ("Involuntary Termination"), he will be paid a lump sum "Transition/Retention Bonus" (less appropriate payroll deductions) on April 1, 1988 (or upon any such earlier Involuntary Termination) equal to his "Annual Cash Compensation" times the applicable multiple specified in Section V below. The Retention Bonus shall not be considered an offset against, or taken into account in determining, any other amount to which he might otherwise be entitled under PCC's plans and programs, including his Annual Incentive Compensation ("AIC") Plan award for 1987. Annual Cash Compensation is defined for purposes of the Transition/Retention Bonus as an Eligible Executive's annual base salary at March 31, 1987 plus his AIC Plan annual target bonus opportunity as of that date. The term AIC Plan as used in this term sheet, includes any successor plan in which the Eligible Executive participates which provides the Eligible Executive with annual cash bonus opportunities at least equal to those provided by the AIC Plan. II. Severance Arrangement: Upon the Involuntary Termination or an Eligible Executive, he will be paid a lump sum "Severance Payment", less required payroll deductions, equal to his Annual Cash Compensation times the applicable multiple specified in Section V below. The Severance Payment shall be in addition to any Transition/Retention Bonus to which an Eligible Executive may be entitled and, in addition, shall not be considered an offset against, or taken into account in determining, any other amount to which an Eligible Executive might otherwise be entitled, including any earned but unpaid awards under the AIC Plan. Annual Cash Compensation for purposes of the Severance Payment is defined as an Eligible Executive's then current annual base salary plus his then current AIC Plan annual target bonus opportunity. The Severance Arrangement will remain in effect as long as the Eligible Executive is employed by PCC or one of its subsidiaries, but not after he reaches age 65. III. Definitions of Involuntary Termination and Cause: Involuntary Termination for purposes of the Transition/Retention Bonus and the Severance Arrangement includes voluntary termination as a result of (1) the Eligible Executive being required to relocate outside the New York metropolitan area without his consent, or (2) a reduction in the Eligible Executive's annual base salary or AIC annual target bonus opportunity immediately prior to such reduction), other than such a reduction which occurs after March 31, 1988, and is related primarily to the economic performance or prospects of PCC and is not applied to such Eligible Executive in a discriminatory manner. "Cause" as used in this Term Sheet means the willful engaging by the Eligible Executive in conduct that is materially injurious to PCC. IV. Stock Options, Retirement and Savings, Vacation and Group Insured Benefit Programs: Upon an Eligible Executive's Involuntary Termination, he will become fully vested in his PCC employee stock options and in his accrued benefit in any savings and retirement plans, including Benefit Equalization Plans and other supplemental plans or arrangements, in which he participates, and each of his PCC employee stock options will become fully exercisable for a period ending the earlier of (i) two years after the date of such Involuntary Termination or (ii) ten years after the date of grant of such options. Additionally, he will be paid a lump sum amount equal to his unused vacation pay entitlement, less required payroll deductions. Moreover, participation in all of the group benefit plans provided by PCC, a PCC subsidiary or a successor, as the case may be, prior to such Involuntary Termination, including medical, dental, life, disability and other insured benefits ( or their equivalents) and his ten current special benefits, including use of a company-provided automobile will be continued, at no cost to him, for a one year period of until he obtains comparable benefits with another employer, whichever occurs first. Upon termination of his group medical and dental coverage, a described above, the Eligible Executive will be entitled to such contributory medical, dental or other insurance coverage as required by law. Additionally, he will be eligible within 31 days after termination of his life and/or medical insurance coverage (including any contributory extended coverage required by law) to convert such coverages to individuals policies. V. Eligible Executives: Multiple Name Title Transition/ Retention Severance N. M. Hahl VP - Acctg & Taxes 1.0 1.0 VI. Death or Disability: If an Eligible Executive's employment should terminate prior to March 31, 1988 due to his death or disability, he (or his legal representatives) shall be paid a pro-rata portion of his Transition/Retention Bonus opportunity based on the portion of the 12 months ending March 31, 1988 that he was continuously employed by PCC or one of its subsidiaries. -2- VII. PCC Obligation: The Transition/Retention Bonus and Severance Arrangements described herein will be legal obligations of and binding upon PCC and its successors and assigns. -3- EX-10 11 EXHIBIT 10(H) BUCKEYE AGREEMENT SHARE PURCHASE AGREEMENT Relating to the Acquisition of BUCKEYE MANAGEMENT COMPANY by BMC ACQUISITION COMPANY Dated: January 5, 1996 TABLE OF CONTENTS Page ARTICLE 1 SALE AND PURCHASE OF SHARES 1 1.1 Sale and Purchase of the Shares 1 1.2 The Purchase Price 1 ARTICLE 2 THE CLOSING 2 2.1 Closing Date 2 2.2 Deliveries 2 ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDER 2 3.1 Organization and Standing 2 3.2 Capitalization and Share Ownership 3 3.3 Authority and Binding Effect 3 3.4 Validity of Contemplated Transactions 3 3.5 Subsidiaries 4 3.6 Taxes 4 3.7 No Material Undisclosed Facts 5 ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF THE BUYER 5 4.1 Organization and Standing 5 4.2 Authority and Binding Effect 5 4.3 Validity of Contemplated Transactions 5 4.4 Purchase for Investment 6 4.5 Available Financing 6 4.6 Financial Projections 6 4.7 Investigation and Evaluation 6 4.8 Securities Law Matters 7 ARTICLE 5 CERTAIN COVENANTS 8 5.1 Conduct of Business Pending Closing 8 5.2 Approvals 9 5.3 Confidential Information. 9 5.4 Public Announcements 10 5.5 Tax Matters 10 5.6 Audit Adjustments. 12 5.7 Certain Employee Benefit Arrangements 13 5.8 Insurance Arrangements 14 5.9 NJ Environmental Liabilities 16 5.10 Prudential Financing and Special Committee Approval 17 5.11 No Solicitation of Transactions 17 ARTICLE 6 CONDITIONS PRECEDENT TO OBLIGATIONS OF THE BUYER 18 6.1 Representations and Warranties 18 6.2 Performance by the Shareholder 18 6.3 Certificates 18 6.4 Intentionally Omitted 18 6.5 Litigation Affecting Closing 18 6.6 Regulatory Compliance and Approvals 18 6.7 Consents 19 6.8 Financing 19 6.9 Special Committee 19 ARTICLE 7 CONDITIONS PRECEDENT TO OBLIGATIONS OF THE SHAREHOLDER 19 7.1 Buyer Representations True at Closing 19 7.2 Performance by the Buyer 19 7.3 Officer's Certificate 19 7.4 Demand Notes 20 7.5 Incumbency Certificate 20 7.6 Opinion of Counsel 20 7.7 Litigation Affecting Closing 20 7.8 Regulatory Compliance and Approval 20 7.9 Special Committee 20 ARTICLE 8 MISCELLANEOUS 20 8.1 No Survival of Representation and Warranties 20 8.2 Payment of Expenses 21 8.3 Termination 21 8.4 Brokers' and Finders' Fees 21 8.5 Assignment and Binding Effect 22 8.6 Waiver 22 8.7 Notices 22 8.8 Pennsylvania Law to Govern 23 8.9 Remedies Not Exclusive 23 8.10 No Benefit to Others 23 8.11 Contents of Agreement 23 8.12 Section Headings and Gender 24 8.13 Cooperation 24 8.14 Severability 24 8.15 Counterparts 24 Annex I Certain Defined Terms Schedule 4.1 List of Common Stock Subscribers SHARE PURCHASE AGREEMENT This SHARE PURCHASE AGREEMENT is dated as of January 5, 1996. The parties are PENNSYLVANIA COMPANY, a Delaware corporation (the "Shareholder"), being the owner of all of the issued and outstanding shares of capital stock of BUCKEYE MANAGEMENT COMPANY, a Delaware corporation (the "Company"), and BMC ACQUISITION COMPANY, a Delaware corporation (the "Buyer"). PREAMBLE The Shareholder owns 1,000 shares of Common Stock, par value $1.00 per share (the "Common Stock"), of the Company which constitutes all of the issued and outstanding shares of capital stock of the Company (the "Shares"). The Buyer desires to purchase from the Shareholder, and the Shareholder desires to sell to the Buyer, all of the Shares in exchange for the Purchase Price in accordance with the terms and conditions set forth in this Agreement. The parties hereto have determined to make an election under Section 338(h)(10) of the Internal Revenue Code of 1986, as amended and in effect on the date hereof (the "Code"), to have the purchase and sale of the Shares hereunder treated for Federal income tax purposes as a purchase of assets by the Buyer from the Shareholder. For convenience and brevity, certain terms used in various parts of this Agreement are listed in alphabetical order and defined or referred to on Annex I hereto (such terms to be equally applicable to both singular and plural forms of the terms defined). NOW, THEREFORE, in consideration of the respective covenants, representations and warranties herein contained, and intending to be legally bound hereby, the parties hereto agree as follows: ARTICLE 1 SALE AND PURCHASE OF SHARES 1.1 Sale and Purchase of the Shares. On the Closing Date and subject to the terms and conditions hereinafter set forth and on the basis of and in reliance upon the representations, warranties, obligations and agreements set forth herein, the Shareholder shall sell to the Buyer and the Buyer shall purchase from the Shareholder all of the Shares in exchange for the payment to the Shareholder of the Purchase Price. 1.2 The Purchase Price. On the Closing Date and subject to the terms and conditions hereinafter set forth and on the basis of and in reliance upon the representations, warranties, obligations and agreements set forth herein, the Buyer shall pay to the Shareholder $63,000,000 (the "Purchase Price"), payable by wire transfer of immediately available funds to such account as the Shareholder shall designate. -1- ARTICLE 2 THE CLOSING 2.1 Closing Date. The Closing (the "Closing") of the sale and purchase of the Shares shall take place at the offices of Morgan, Lewis & Bockius LLP, 2000 One Logan Square, Philadelphia, Pennsylvania at 10:00 A.M. local time, on the later of (i) March 8, 1996, (ii) the fifth business day following the satisfaction or waiver of all of the conditions set forth in Articles 6 and 7 hereof, or (iii) at such other time or place or on such other date as the Buyer and the Shareholder may agree to in writing. The date of the Closing is hereinafter sometimes referred to as the "Closing Date." The Closing shall be deemed to have occurred as of the close of business on the Closing Date. 2.2 Deliveries. At the Closing, subject to the provisions of this Agreement, the Shareholder shall deliver to the Buyer, free and clear of all Liens, the certificates for the Shares to be sold by such Shareholder, duly endorsed in blank, or with separate stock transfer powers attached thereto and signed in blank, and the Buyer shall deliver to the Shareholder the Purchase Price by wire transfer of immediately available funds. At the Closing, the Shareholder shall also deliver to the Buyer, and the Buyer shall deliver to the Shareholder, the certificates, opinions and other instruments and documents referred to in Articles 6 and 7. The Buyer and the Shareholder shall deliver executed copies of IRS Form 8023 making the joint election under Section 338(h)(10) of the Code, and in the case of the Buyer the election under Section 338(g) of the Code to allow the election under Section 338(h)(10) of the Code to be made. The parties shall cooperate with each other to reach agreement upon a schedule of the allocation of the Purchase Price to be attached to the IRS Form 8023 by each of the Buyer and the Shareholder. ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDER The Shareholder hereby represents and warrants to the Buyer that: 3.1 Organization and Standing. The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware, having full corporate power and authority to carry on its business as it is now being conducted and to own, lease and operate its assets. The Company is duly qualified to do business and is in good standing in every jurisdiction in which its business or the character of its assets requires such qualification and in which the failure to be so qualified would have a Company Material Adverse Effect. -2- 3.2 Capitalization and Share Ownership. The Company's authorized capital stock consists of 1,000 shares of Common Stock, par value $1.00 per share, of which 1,000 shares are presently outstanding (previously defined as the "Shares"), which Shares are owned by the Shareholder free and clear of any Liens. All of the Shares have been duly authorized and validly issued, are fully paid and nonassessable, were not issued in violation of the terms of any Contract binding upon the Company, and were issued in compliance with all applicable charter documents of the Company. No equity securities of the Company, other than the Shares, are issued or outstanding. There are, and have been, no preemptive rights with respect to the issuance of the Shares. There are no existing Contracts, subscriptions, options, warrants, calls, commitments or rights of any character to purchase or otherwise acquire any capital stock or other securities of the Company, whether or not presently issued or outstanding, from the Shareholder or the Company, at any time, or upon the happening of any stated event. 3.3 Authority and Binding Effect. The Shareholder has the full corporate power, authority and legal right to execute, deliver and perform this Agreement. The execution, delivery and performance of this Agreement by the Shareholder has been duly authorized by all necessary corporate and shareholder action. This Agreement has been, and the other agreements, documents and instruments required to be delivered by the Shareholder in accordance with the provisions hereof (the "Shareholder Documents") will be, duly executed and delivered on behalf of the Shareholder by duly authorized officers of the Shareholder, and this Agreement constitutes, and the Shareholder Documents will constitute, the legal, valid and binding obligations of the Shareholder, enforceable against the Shareholder in accordance with their respective terms, except as may be limited by bankruptcy or insolvency laws and other similar laws or equitable principles affecting rights of creditors generally. 3.4 Validity of Contemplated Transactions. Neither the execution and delivery of this Agreement by the Shareholder nor the consummation of the transactions contemplated hereby will contravene or violate the charter documents or by-laws of the Shareholder or the Company or any Regulation or Court Order which is applicable to the Company or the Shareholder, or will result in a Default under, or require the consent or approval of any party to, any material Contract relating to its business or its assets or to or by which the Company or the Shareholder is a party or otherwise bound or affected, or, to the Shareholder's knowledge based upon oral opinions of counsel, require the Company or the Shareholder to notify or obtain any License from any federal, state, local or other court or governmental agency or body or from any other regulatory authority, except for public utility commission or environmental approvals required to be obtained by the Company. -3- 3.5 Subsidiaries. Except for interests in Buckeye Pipe Line Company, a Delaware corporation (the "Management Subsidiary"), and the Master Partnership, and the interests of the Management Subsidiary in each of the Operating Partnerships, neither the Company nor the Management Subsidiary has any subsidiaries or stock or other equity or ownership interest (whether controlling or not) in any corporation, association, partnership, limited liability company, joint venture or other entity. The Company owns of record and beneficially (i) all of the issued and outstanding capital stock of the Management Subsidiary free and clear of any Liens, and (ii) a 1% general partnership interest in the Master Partnership in accordance with the Master Partnership Agreement. The Company is the general partner of the Master Partnership. The Management Subsidiary owns of record and beneficially a 1% general partnership interest in each of the Operating Partnerships in accordance with the Operating Partnership Agreements related thereto and a .99% limited partnership interest in Buckeye Pipe Line Company of Michigan, L.P. pursuant to its Operating Partnership Agreement. The Management Subsidiary is the sole general partner of the Operating Partnerships. There are: (a) no existing Contracts, subscriptions, options, warrants, calls, commitments or rights of any character to purchase or otherwise acquire from the Company or the Management Subsidiary at any time, or upon the happening of any stated event, any capital shares or other securities of the Company, the Management Subsidiary, the Master Partnership, or the Operating Partnerships, whether or not presently issued or outstanding; (b) no outstanding securities of the Management Subsidiary that are convertible into or exchangeable for capital shares or other securities of the Management Subsidiary; and (c) no Contracts, subscriptions, options, warrants, calls, commitments or rights to purchase or otherwise acquire from the Company or the Management Subsidiary any such convertible or exchangeable securities. 3.6 Taxes. All United States Federal income tax returns and all other material tax returns which are required to be filed with respect to the Company and the Management Subsidiary have been filed (except in instances in which there is an effective extension of the time in which to file a tax return) and all taxes due with respect thereto or pursuant to any assessment with respect to the Company or the Management Subsidiary have been paid, except for assessments the validity of which is being contested in good faith by appropriate proceedings. 3.7 No Material Undisclosed Facts. The Shareholder has not omitted to disclose to the Buyer any material fact with respect to the Company or the Management Subsidiary, actually known by the Shareholder which is not known to the Company or the Management Subsidiary. ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF THE BUYER The Buyer hereby represents and warrants to the Company and the Shareholder as follows: -4- 4.1 Organization and Standing. The Buyer is a corporation duly organized, validly existing and in good standing under the laws of Delaware, having all requisite corporate power and authority to perform its obligations under this Agreement. As of the date hereof, the Buyer has received legally binding subscriptions from the persons listed on Schedule 4.1 to contribute not less than $5 million to the Company on or before the Closing Date in return for common stock of the Buyer. (In the case of Alfred W. Martinelli, his subscription is subject to financing to be provided by the Shareholder or its affiliates in the event that the Closing Date occurs prior to March 13, 1996.) The Buyer has no assets or liabilities except for its rights and obligations under this Agreement, the subscriptions and Prudential Commitment Letter. 4.2 Authority and Binding Effect. The Buyer has the corporate power and authority to execute, deliver and perform this Agreement and the other agreements, documents and instruments required to be delivered by the Buyer in accordance with the provisions hereof (the "Buyer Documents"), and has taken all actions necessary to secure all approvals required in connection therewith. The execution, delivery and performance of this Agreement and the Buyer Documents by the Buyer has been duly authorized by all necessary corporate and shareholder action. This Agreement has been, and the Buyer Documents will be, duly executed and delivered on behalf of the Buyer by duly authorized officers of the Buyer, and this Agreement constitutes, and the Buyer Documents will constitute, the legal, valid and binding obligation of the Buyer, enforceable against it in accordance with their respective terms, except as may be limited by bankruptcy or insolvency and other similar laws or equitable principles affecting rights of creditors generally. 4.3 Validity of Contemplated Transactions. Neither the execution and delivery of this Agreement by the Buyer nor the consummation of the transactions contemplated hereby by the Buyer will contravene or violate any Regulation or Court Order which is applicable to the Buyer, or the charter documents or By-Laws of the Buyer, or will result in a Default under any Contract to which the Buyer is a party or by which it is otherwise bound, or require the Buyer to notify or obtain any License from any federal, state, local or other court or governmental agency or body or from any other regulatory authority. 4.4 Purchase for Investment. The Buyer is acquiring the Shares solely for its own account for investment and not with a view to or for the sale or distribution thereof. The Buyer acknowledges that the Shares are not registered under the Securities Act of 1933, as amended, and that such Shares may not be transferred or sold except pursuant to the registration provisions of the Securities Act or pursuant to an applicable exemption therefrom. -5- 4.5 Available Financing. The Buyer has delivered to the Shareholder a commitment letter (the "Prudential Commitment Letter") from Prudential Capital Group to lend the Buyer up to $63,000,000 to purchase the Shares. The Buyer has no reason to believe that Prudential Capital Group and the Buyer will not be able to reach agreement on the form and substance of a definitive agreement reflecting the terms of the Prudential Commitment Letter or that all conditions precedent to the obligations of Prudential Capital Group contained therein or in the Prudential Commitment Letter will not be satisfied. 4.6 Financial Projections. The Buyer has provided to the Shareholder financial projections for the Buyer, the Company, and the Management Subsidiary, supported by a cost reduction proposal, which reflects the financial impact of the Company's results of operations, reimbursements from the Master Partnership and Operating Partnerships, sources of expense savings, repayment of the financing described in the Prudential Commitment Letter, and the payment by the Buyer, the Company and the Management Subsidiary of their obligations as they become due (the "Financial Information"). The Buyer represents that (i) such Financial Information was prepared in good faith, (ii) the Buyer reasonably believes the assumptions upon which the projections contained in the Financial Information are based are reasonable and (iii) the Buyer currently intends to operate the Company and the Management Subsidiary in a manner consistent in all material respects with the assumptions contained in the Financial Information. 4.7 Investigation and Evaluation. The Buyer acknowledges that (a) the Buyer is experienced in the operation of the type of business conducted by the Company, the Management Subsidiary, the Master Partnership and the Operating Partnerships, (b) the Buyer and its directors, officers, attorneys, accountants and advisors have been given the opportunity to examine to the full extent deemed necessary by the Buyer all books, records and other information with respect to the Company, the Management Subsidiary, the Master Partnership and the Operating Partnerships, (c) the Buyer has taken full responsibility for determining the scope of its investigations of the Company, the Management Subsidiary, the Master Partnership and the Operating Partnerships, and for the manner in which such investigations have been conducted, and has examined the Company, the Management Subsidiary, the Master Partnership and the Operating Partnerships to the Buyer's full satisfaction, (d) the Buyer is fully capable of evaluating the adequacy and accuracy of the information and material obtained by the Buyer in the course of such investigations, (e) the Buyer has not relied on the Shareholder with respect to any matter in connection with the Buyer's evaluation of the Company, the Management Subsidiary, the Master Partnership and the Operating Partnerships, other than the representations and warranties specifically set forth in Article 3, and (f) the Shareholder is making no representations or warranties, express or implied, of any nature whatever with respect to the Company, the -6- Management Subsidiary, the Master Partnership and the Operating Partnerships, other than the representations and warranties of the Shareholder specifically set forth in Article 3. The Buyer acknowledges that (a) the Buyer has taken full responsibility for evaluating the adequacy, completeness and accuracy of various forecasts, projections, opinions and similar material heretofore furnished by the Shareholder, its affiliates or their representatives to the Buyer in connection with the Buyer's investigations of the Company, the Management Subsidiary, the Master Partnership, and the Operating Partnerships and their respective businesses, assets and liabilities; (b) there are uncertainties inherent in attempting to make projections and forecasts and render opinions, the Buyer is familiar with such uncertainties, and the Buyer is not relying on any projections, forecasts or opinions furnished to it by the Shareholder, or any affiliate thereof or any of their representatives; and (c) neither the Shareholder nor any affiliate of the Shareholder makes any representations or warranties concerning any such forecasts or projections. 4.8 Securities Law Matters. To the knowledge of the Buyer, neither this Agreement, nor any other agreement, document, certificate or written statement furnished to the Buyer by or on behalf of the Shareholder in connection with the transactions contemplated hereby contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements contained herein or therein not misleading. The Buyer, for itself, its employees, shareholders and affiliates, irrevocably acknowledges and confirms that the Shareholder has complied in all respects with its obligations to the Buyer, if any, under Rule 10b-5 under the Securities Exchange Act of 1934, as amended, and under all other federal and state securities laws in connection with the transactions contemplated hereby. ARTICLE 5 CERTAIN COVENANTS 5.1 Conduct of Business Pending Closing. Until the Closing Date, except as may be approved by the Buyer in writing or as otherwise provided in this Agreement, the Shareholder shall use its reasonable efforts (subject to the fiduciary duty of the Company and the Management Subsidiary to the Master Partnership and the Operating Partnerships) to cause the Company and the Management Subsidiary to: (A) operate the business of the Company, the Management Subsidiary, the Master Partnership and the Operating Partnerships solely in the ordinary course and in substantially the same manner as such business has been operated in the past; -7- (B) not issue, repurchase or redeem or commit to issue, repurchase or redeem, or permit the Master Partnership to issue, repurchase or redeem, any shares of capital stock or partnership units, any options or other rights to acquire such stock or units or any securities convertible into or exchangeable for such stock or units except pursuant to the Buckeye Partners, L.P. Unit Option and Distribution Equivalent Plan; (C) not declare or pay any dividend on, or make any other distribution with respect to, the Shares; (D) not declare, pay or make any other distribution with respect to, the partnership units of the Master Partnership, except for periodic distributions by the Master Partnership with respect to such units in amounts and at times which are consistent with past practice; (E) not (1) incur a material amount of long or short-term debt for money borrowed, (2) guarantee or agree to guarantee the obligations of others, (3) indemnify or agree to indemnify others, or (4) incur any other material Liabilities, in each case other than those incurred in the ordinary course of business consistent with past practice; (F) use its reasonable efforts to retain the employees of the Management Subsidiary and maintain the respective businesses of the Company and the Management Subsidiary so that employees will remain available to the Management Subsidiary on and after the Closing Date and to maintain existing relationships with suppliers, customers and others having business dealings with the Company or the Management Subsidiary; (G) not amend its Certificate of Incorporation or By-Laws or the Master Partnership Agreement or the Operating Partnership Agreements; (H) not merge with or into any other corporation or, except in the ordinary course of business, sell, assign, transfer, pledge or encumber any part of the assets of the Company or the Management Subsidiary or agree to do any of the foregoing; (I) except in the ordinary course of business, not enter into any Contract on their own behalf, rather than as agent for or a partner of the Master Partnership or any of the Operating Partnerships, that is material, or permit any amendment or termination of any such material Contract to which the Company or the Management Subsidiary is a party; (J) except in the ordinary course of business, not waive any rights of material value that would otherwise accrue to the Company after the Closing Date; -8- (K) except in the ordinary course of business (or as disclosed in the Disclosure Letter), not increase the salaries or benefits of, or make any bonus or similar payments to or establish or modify any Employee Benefit Plans for, any of the Company's directors, officers or employees or enter into or modify any employment, consulting or similar Contracts with any such persons or agree to do any of the foregoing; (L) use its reasonable efforts to obtain any consents or approvals required under any material Contracts that are necessary to complete the Acquisition or to avoid a Default under any such Contracts; and (M) not make any capital expenditures on its own behalf, rather than as agent for or a partner of the Master Partnership or any of the Operating Partnerships, in excess of $1,000,000. 5.2 Approvals. The Buyer and the Shareholder shall use their reasonable efforts to obtain promptly all Licenses from all Regulatory Bodies and all consents required under the terms of any Contracts which are required in connection with the consummation of the Acquisition. 5.3 Confidential Information. Promptly, but in no event later than 5 business days, following the later of (a) the approval by the Special Committee of the matters described in Section 7.9 and (b) the delivery by the Buyer to the Shareholder of written confirmation from Prudential Capital Group that the Finance Committee of the Board of Directors of The Prudential Insurance Company of America has authorized Prudential Capital Group to purchase a note or notes in accordance with the Prudential Commitment Letter, the Shareholder shall cause Furman Selz LLC to require all parties to any confidentiality agreement between Furman Selz LLC on behalf of the Shareholder and any other party with respect to a sale of the Company to return or destroy all confidential information of the Company, the Management Subsidiary, the Master Partnership and the Operating Partnerships in accordance with the terms of such confidentiality agreements. At the Closing, the Shareholder will, to the extent legally assignable, assign all of its rights under such confidentiality agreements to the Company. 5.4 Public Announcements. The Buyer and the Shareholder shall not make any public announcement of the transactions contemplated hereby without the prior written consent of the other party. Nothing contained herein shall prevent either party at any time from furnishing any information to any governmental agency or pursuant to any Court Order or which is required by any Regulation or any rule of the New York Stock Exchange. -9- 5.5 Tax Matters. (A) Section 338(h)(10) Election. The Shareholder and the Buyer shall make a timely joint election under Section 338(h)(10) of the Code and pursuant to the applicable provisions of the Temporary Treasury Regulations in order that the transaction contemplated by this Agreement will be treated for Federal income tax purposes as a purchase of assets by the Buyer from the Company. Any liability for taxes resulting from the election by the Buyer and the Shareholder under Section 338(h)(10) of the Code will be paid by the Shareholder. (B) Taxes Prior to and After the Closing Date. The Shareholder shall include the Company in the applicable consolidated federal income tax return for the period prior to and including the Closing Date. Taxes as a result of the joint election under Section 338(h)(10) will be borne by the Shareholder. Any adjustments in taxes of the Company for the period to and including the Closing Date shall be borne by the Shareholder. The liability for any taxes of the Company for the periods beginning after the Closing Date shall be borne by the Company and the Buyer. The Buyer shall make an election under Section 338(g) of the Code to the extent necessary to allow the Section 338(h)(10) election to be made. The Buyer will indemnify and hold harmless the Shareholder and the Company against any and all liability (including, without limitation, interest, additions to tax and penalties) for or with respect to federal, state or local income taxes of the Company claimed or assessed for all taxable periods beginning after the Closing Date. The Shareholder will indemnify and hold harmless the Buyer and the Company against any and all liability (including, without limitation, interest, additions to tax and penalties) for or with respect to federal, state or local income taxes of the Company claimed or assessed for all taxable periods including periods to and including the Closing Date. (C) Indemnification With Respect to Taxes. Without limiting the indemnification obligations of any party contained elsewhere herein: After the Closing, the Shareholder will indemnify and hold harmless the Buyer and the Company against any and all liability (including, without limitation, interest, additions to tax and penalties) for or with respect to federal income taxes (and state or local income taxes in states in which tangible personal property or real property of the Company is located) of the Company claimed or assessed for all taxable periods ending on or prior to the Closing Date attributable to gain realized by the Company as a result of the purchase and sale of the Shares pursuant hereto and the making of the joint election by the Shareholder and the Buyer under Section 338(h)(10) of the Code (and by the Buyer under Section 338(g) of the Code but only to the extent it is required for the election under Section 338(h)(10) of the Code)), net of any tax benefit resulting from such payment. If the parties are unable to agree with respect to the amount of any payment due under the preceding sentence, the matter shall be submitted to an independent accounting firm selected by both parties. The decision of such independent accounting firm shall be binding upon both parties and the expense of such independent accounting firm shall be borne equally by the parties. -10- (D) Prior Period Adjustments. The Shareholder shall have the right to contest any adjustment that increases the liability of the Company or the Shareholder for taxes which arose during the period or periods ending on or prior to the Closing Date (including federal income taxes (and state or local income taxes in states which tangible personal property or real property of the Company is located) attributable to gain realized by the Company as a result of the purchase and sale of the Shares pursuant hereto and the making of the joint election by the Shareholder and Buyer under Section 338(h)(10) of the Code (and by the Buyer under Section 338(g) of the Code but only to the extent it is required for the election under Section 338(h)(10) of the Code)). The Buyer agrees to cooperate or cause the Company to cooperate in the negotiation, settlement or litigation of any such adjustment. All decisions with respect to the negotiation, settlement or litigation of any such adjustment shall be made by the Shareholder and shall be binding upon the Buyer. All expenses to contest such adjustment on behalf of the Company shall be borne by the Shareholder. Any indemnity payable by the Shareholder to the Buyer or the Company pursuant to this Section 5.5(D) shall be payable within 10 days of the Buyer's and/or the Company's request therefor, which request shall be no sooner than within 20 days of the required remittance to the tax authority. The parties agree that any payment made pursuant to this Section 5.5(D) shall be deemed an adjustment to the Purchase Price hereunder. (E) Cooperation. After the Closing Date, the Buyer, the Shareholder and the Company shall cooperate fully with each other and shall make available to the other, as reasonably requested, and to any taxing authority, all information, records or documents relating to tax liabilities or potential tax liabilities of the Company for all periods prior to or ending on the Closing Date and shall preserve all such information, records and documents until the expiration of any applicable statutes of limitation or extensions thereof. The Buyer, the Shareholder and the Company shall also make available to each other, as reasonably requested, personnel responsible for preparing or maintaining information, records and documents in connection with tax matters. (F) Audits. So long as taxable periods of the Company ending on or before the Closing Date remain open, the Buyer and the Shareholder shall promptly notify the other in writing within 10 days from receipt by the Buyer or the Shareholder of notice of (i) any pending or threatened federal, state or local income tax audits or assessments of the Company, and (ii) any pending or threatened federal, state or local income tax audits or assessments of the Buyer which may affect the tax liabilities of the Company for taxable periods ending on or before the Closing Date. The Shareholder shall have the right to represent the interests of the Company in any tax audit or administrative or court proceeding relating to fiscal periods ending on or before the Closing and to employ counsel of its choice at its expense. The Buyer agrees that it will, at the Shareholder's expense, cooperate fully with the Shareholder and its counsel in the defense against or compromise of any claim in any said proceeding. -11- 5.6 Audit Adjustments. (A) If, as a result of the examination of the consolidated federal, state or local income tax return of the Shareholder or the Company (or any predecessor) for a taxable year ending on or before or including the Closing Date, there shall be any adjustment which decreases deductions, losses or credits against taxes ("Tax Benefits") or which increases income, gains or recaptures of credits against taxes ("Tax Detriments") for any such taxable year and which will permit the Buyer or the Company (or any corporation in an affiliated group of which the Buyer or the Company is a member) to increase the Tax Benefits or decrease the Tax Detriments to which they would otherwise have been entitled for any taxable year beginning on or after the Closing Date, the Shareholder will notify the Buyer of such adjustment and provide the Buyer with such information as may be necessary for the Buyer to take account of such increases or decreases through the filing of a claim for refund or otherwise. The Buyer shall take such action as is necessary to secure the benefit of such increases or decreases and shall pay the Shareholder the amount of such benefit (together with interest, if any, received), such amount to be paid when and as such benefit is realized, less the amount, if any, of the Buyer's reasonable expenses incurred in securing such benefit for the Shareholder. (B) If, as a result of the examination of the consolidated or separate federal, state or local income tax return of any group of corporations of which the Buyer or the Company (or any successor) is a member for a taxable year beginning on or after the Closing Date, there shall be any adjustment which decreases Tax Benefits or increases Tax Detriments for any such taxable year and which will permit the Shareholder or any member of the Shareholder's consolidated group to increase Tax Benefits or decrease Tax Detriments to which the Shareholder would otherwise have been entitled for any taxable year ending on or before and including the Closing Date, the Buyer will notify the Shareholder of such adjustment and provide the Shareholder with such information as may be necessary for the Shareholder to take account of such increase or decrease through the filing of a claim for refund or otherwise. The Shareholder shall take such action as is necessary to secure the benefit of such increases or decreases and shall pay to the Buyer the amount of such benefit (together with interest, if any, received), such amount to be paid when and as such benefit is realized, less the amount, if any, of the Shareholder's reasonable expenses incurred in securing such benefit for the Buyer. 5.7 Certain Employee Benefit Arrangements. From and after the Closing: (A) The Buckeye Pipe Line Company Retirement Income Guarantee Plan. The Buckeye Pipe Line Company Retirement Income Guarantee Plan (the "RIGP") is funded through a master defined benefit trust (the "Master DB -12- Trust"). After the Closing Date, Buckeye Pipe Line Company will continue to be the "Plan Sponsor", as defined in ERISA, for such RIGP (and will continue to be responsible for any contributions required or due with respect to the RIGP). Within 45 days after the Closing Date, the Buyer shall identify a successor trust to hold the assets of the RIGP, and promptly after identification of such successor trust, the trustee of the Master DB Trust shall transfer the pro rata share of the assets of the Master DB Trust allocable to the RIGP to the trustee of such successor trust. (B) The Buckeye Pipe Line Company Retirement and Savings Plan. After the Closing Date, Buckeye Pipe Line Company will continue to be the "Plan Sponsor", as defined in ERISA, with respect to the Buckeye Pipe Line Company Retirement and Savings Plan (the "RASP") (and will continue to be responsible for any contributions required or due with respect to the RASP). The Buyer agrees to retain, through the end of 1996, the provision in the RASP allowing participants in the RASP to transfer their account balances from the RASP to the American Premier Retirement and Savings Plan. A portion of the assets of the RASP are invested in a trust which holds fixed income assets on behalf of the RASP and other qualified retirement plans (the "Fixed Income Trust"). Within 45 days after the Closing Date, the Buyer shall identify a successor trust to hold the assets of the RASP invested in the Fixed Income Trust and, promptly after identification of such successor trust, the trustee of the Fixed Income Trust shall transfer a pro rata share of the assets in the Fixed Income Trust allocable to the RASP to the trustee of such successor trust. 5.8 Insurance Arrangements. From and after the Closing: (a) The Company and the Management Subsidiary shall cease to be covered with respect to any occurrence after the Closing under the insurance policies and agreements obtained and maintained by the Shareholder and its affiliates covering the Company and the Management Subsidiary, (the "Policies"). All such occurrences prior to the Closing which are insured under the Policies shall continue to be so insured, and the Company and Management Subsidiary shall be entitled to the benefits thereof, subject to applicable Retention Levels. The Buyer shall cause the Company and the Management Subsidiary to pay to the Shareholder and its affiliates any retrospective premium adjustments and premium audit adjustments payable to insurance carriers and all retention payments in respect of insurance covering the Company and the Management Subsidiary for periods prior to the Closing Date. The Shareholder shall, or shall cause its affiliates to, pay to the Company any rebate received with respect to any premiums paid prior to the Closing Date in respect of Policies covering the Company and the Management Subsidiary for periods subsequent to the Closing Date as a result of the removal of the Company and the Management Subsidiary from coverage under such Policies. -13- (b) Provided the Buyer is not in breach of its obligations under subsection (c) hereof, the Shareholder shall indemnify and hold the Company and the Management Subsidiary to the extent they are named insured under the applicable Policy or Policies harmless from and against any and all Insured Losses to the extent such Insured Losses exceed the applicable Retention Level of the Company or the Management Subsidiary but do not exceed the Retention Level applicable to the Shareholder and its affiliates with respect thereto. Neither the Shareholder nor its affiliates shall have any liability to the Company or the Management Subsidiary for any Insured Losses to the extent such Insured Losses (a) are within the applicable Retention Level for the particular company or (b) exceed the applicable Retention Level for the Shareholder and its affiliates. In addition, the Shareholder and its affiliates shall have no liability to the Buyer, the Company or the Management Subsidiary for any Loss which would not be covered by the insuring terms and conditions of the applicable Policy, assuming a Retention Level for the Shareholder and its affiliates of zero. (c) The Company and the Management Subsidiary shall be liable and responsible for all the Insured Losses that are within the Retention Levels applicable to them. Accordingly, provided the Shareholder and its affiliates are not in breach of their obligations under section (b) hereof, the Buyer will cause the Company and the Management Subsidiary to either, as the Shareholder shall direct, (a) reimburse the Shareholder and its affiliates for such payments as the Shareholder and its affiliates may make in the normal course of their claims management program to the applicable insurer or claims administrator of Insured Losses that are within the Retention Levels of the Company and the Management Subsidiary, such reimbursement to be made promptly and in any event within 15 days of presentation of the Shareholder's written invoices therefor or (b) pay such Insured Losses directly to the applicable insurer or claims administrator. The Buyer will, and will cause the Company and the Management Subsidiary to, negotiate in good faith to settle all claims under the Policies within the applicable Retention Levels of the Company and the Management Subsidiary and promptly notify and consult with the Shareholder regarding any such claim that may exceed the applicable Retention Levels of the Company and the Management Subsidiary. The Shareholder shall have the right to control and direct the defense of any such claim that is likely to exceed the Retention Levels of the Company and the Management Subsidiary. (d) The parties hereto shall give, and shall cause the Company and the Management Subsidiary to give, to each other prompt notice of the assertion by any person of any claim against the Shareholder or any of its affiliates, or the Company and the Management Subsidiary, as the case may be, which might be subject to the insurance coverage or related obligations described in this Section 5.8. The parties hereto shall cooperate, and shall cause the Company and the Management Subsidiary to cooperate, with the Shareholder and its affiliates, or the Company and the Management Subsidiary, as the case may be, and any applicable insurance carrier or claims administrator in any investigation by the Shareholder and its affiliates, or -14- by the Company and the Management Subsidiary, as the case may be, or any applicable insurance carrier or claims administrator, of any such claim, including without limitation any currently pending claim which relates to a pre-Closing occurrence; and the Buyer shall give, and shall cause the Company and the Management Subsidiary to give, to the Shareholder and its affiliates, and any applicable insurance carrier or claims administrator, reasonable access to the books, records and personnel of the Company and the Management Subsidiary to the extent reasonably necessary to enable the Shareholder or any of its affiliates, and any applicable insurance carrier or claims administrator, to investigate such claim. 5.9 NJ Environmental Liabilities. From and after the Closing, the Shareholder or an affiliate of the Shareholder (the Shareholder and each of its affiliates, the "Shareholder Group") shall continue to retain the liabilities described that certain Administrative Consent Order, dated November 17, 1986, issued by the New Jersey Department of Environmental Protection (such liabilities, the "NJ Environmental Liabilities"). In connection with the NJ Environmental Liabilities, the parties agree as follows: (a) The Buyer shall cooperate, and cause the employees and officers of the Company and the Management Subsidiary to cooperate, with the Shareholder Group in connection with all matters related to the NJ Environmental Liabilities and shall provide, at no charge, such administrative assistance with respect thereto as the Shareholder may reasonably request (which may include, without limitation, review of documents and attendance at meetings and teleconferences regarding the NJ Environmental Liabilities). (b) The Buyer shall, and shall cause the Company and the Management Subsidiary to, provide to the Shareholder Group such services, labor and materials, to the extent reasonably available, as the Shareholder may request in connection with the NJ Environmental Liabilities. The Shareholder shall reimburse the Buyer, the Company or the Management Subsidiary, as appropriate, for such entity's direct, out-of-pocket cost (i) of all hourly labor furnished by such entity at the request of the Shareholder, (ii) of all services provided by non-employees of the Buyer, the Company or the Management Subsidiary at the request of the Shareholder, and (iii) of all materials provided by such entity at the request of the Shareholder. The Shareholder Group shall have the right to use, without cost, the water filtration system/waste recovery system and plant located at the Linden, New Jersey premises of the Operating Partnerships (the "Waste Recovery System") in connection with the activities of the Shareholder Group related to the NJ Environmental Liabilities, subject to reimbursement by the Shareholder Group of any costs incurred for activated carbon attributed solely to the Shareholder Group's utilization of the Waste Recovery System. -15- (c) Without the prior consent of the Shareholder, the Buyer shall not take any action which it knows is reasonably likely to increase the amount of the NJ Environmental Liabilities. In addition, the Buyer shall, and shall cause the Company and the Management Subsidiary to, take all commercially reasonable actions to mitigate the expense and liability of the Shareholder Group with respect to the NJ Environmental Liabilities. (d) In connection with the NJ Environmental Liabilities, the Shareholder Group agrees to use commercially reasonable efforts to obtain a Declaration of Environmental Restriction ("DER"). Buyer hereby consents to the issuance of a DER, and agrees that it shall execute, and shall cause the Company, the Management Subsidiary, the Master Partnership and the Operating Partnership, to execute all commercially reasonable documents necessary to obtain a DER. (e) Upon request of the Shareholder the Buyer will use reasonable efforts to support and facilitate any reasonable proposal from the Shareholder Group that the Master Partnership, in consideration for a payment by the Shareholder Group, assume the remaining costs anticipated to be associated with the NJ Environmental Liabilities. (f) The Buyer acknowledges on its own behalf and on behalf of The Company and the Management Subsidiary that there are no unpaid charges for services, labor, materials or facilities provided by the Company or the Management Subsidiary in connection with the NJ Environmental Liabilities. (g) The Buyer acknowledges that the Shareholder Group will not be liable for any environmental liability or expense related to, or arising out of the business of, the Company, the Management Subsidiary, the Master Partnership, or any of the Operating Partnerships, other than the NJ Environmental Liabilities. (h) The Buyer shall indemnify the Shareholder Group against any failure by the Company, the Management Subsidiary, the Master Partnership and the Operating Partnerships to comply with the provisions of this Section 5.9. 5.10 Prudential Financing and Special Committee Approval. The Buyer shall use its best efforts to diligently and as promptly as practicable (i) obtain the approval of the Special Committee of the matters described in Section 6.9 hereof and provide such information in connection therewith as the Special Committee may request; and (ii) negotiate, execute and deliver, and consummate a definitive agreement with Prudential Capital Group providing for the financing described in the Prudential Commitment Letter. Upon the Shareholder's request from time to time, the Buyer shall report to the Shareholder concerning the status of such matters. -16- 5.11 No Solicitation of Transactions. Prior to the termination of this Agreement pursuant to Section 8.3, none of the Shareholder or any of its affiliates or any of their respective directors, officers, employees, representatives, investment bankers or agents shall, directly or indirectly, solicit or initiate inquiries or proposals form, or provide confidential information to or participate in any discussions or negotiations with, any corporation, partnership, person, trust or other entity or group (other than the Buyer and its affiliates and representatives) concerning the sale of stock of the Company or the Management Subsidiary or any of their respective assets or any merger, consolidation, recapitalization, liquidation or similar transaction involving the Company or the Management Subsidiary. This Section 5.11 shall not be considered to limit any rights or remedies the Buyer may have a result of a breach of this Agreement by the Shareholder. ARTICLE 6 CONDITIONS PRECEDENT TO OBLIGATIONS OF THE BUYER Subject to waiver as set forth in Section 8.6, the obligations of the Buyer under this Agreement are subject to the fulfillment prior to or at the Closing of each of the following conditions: 6.1 Representations and Warranties. The representations and warranties of the Shareholder set forth in Article 3 shall be true and correct in all material respects on the Closing Date with the same effect as if made at that time. 6.2 Performance by the Shareholder. The Shareholder shall have performed and satisfied in all material respects all agreements and conditions which it is required by this Agreement to perform or satisfy prior to or on the Closing Date. 6.3 Certificates. The Buyer shall have received certificates from the Shareholder dated the Closing Date certifying in such detail as the Buyer may reasonably request that each of the conditions described in Sections 6.1 and 6.2 has been fulfilled. 6.4 Intentionally Omitted. 6.5 Litigation Affecting Closing. No Court Order shall have been issued or entered which prohibits the completion of the Acquisition. 6.6 Regulatory Compliance and Approvals. All approvals required under any Regulations to carry out the Acquisition shall have been obtained and the Company and the Shareholder shall have complied in all material respects with all Regulations applicable to the Acquisition. -17- 6.7 Consents. The Shareholder or the Company shall have delivered to the Buyer all consents required to be obtained in connection with the Acquisition in order to avoid a Default under any material Contract to or by which the Company is a party or may be bound. 6.8 Financing. The Buyer and Prudential Capital Group shall have entered into a definitive agreement reflecting the terms of the Prudential Commitment Letter and the Prudential Capital Group shall be prepared to fund the loan provided for thereby in the amount of $63,000,000 contemporaneously with the Closing. 6.9 Special Committee. A committee of independent directors of the Company which will exclude all directors who are employees of the Shareholder, the Company or their affiliates (the "Special Committee") shall have approved on behalf of the Master Partnership (i) the form of opinion of Morgan, Lewis & Bockius LLP relating to the satisfaction by the Buyer of the Company's capital requirement in compliance with Sections 17.6 and 19.1 of the Master Partnership Agreement after giving effect to the cancellation of the Demand Notes and (ii) the Buyer's employee stock ownership plan as a fringe benefit, the cost of which may be reasonably allocated to the Partnership pursuant to Section 7.4 of the Master Partnership Agreement. ARTICLE 7 CONDITIONS PRECEDENT TO OBLIGATIONS OF THE SHAREHOLDER Subject to waiver as set forth in Section 8.6, the obligations of the Shareholder under this Agreement are subject to the fulfillment prior to or at the Closing of each of the following conditions: 7.1 Buyer Representations True at Closing. The representations and warranties of the Buyer set forth in Article 4 shall be true and correct in all material respects on the Closing Date with the same effect as if made at that time. 7.2 Performance by the Buyer. The Buyer shall have performed and satisfied all agreements and conditions which it is required by this Agreement to perform or satisfy prior to or on the Closing Date. 7.3 Officer's Certificate. The Shareholder shall have received a certificate from an appropriate officer of the Buyer dated the Closing Date certifying in such detail as the Shareholder may reasonably request that each of the conditions described in Sections 7.1 and 7.2 has been fulfilled. 7.4 Demand Notes. The Shareholder shall have been released from its obligations under the Demand Notes, and the Buyer shall have provided for capitalization of the Company in the amount of at least $6 million. -18- 7.5 Incumbency Certificate. The Shareholder shall have received a certificate of the Secretary or an Assistant Secretary of the Buyer dated the Closing Date certifying to the incumbency of the officers of the Buyer signing for it and as to the authenticity of their signatures. 7.6 Opinion of Counsel. The Shareholder shall have received the written opinion dated the Closing Date of Morgan, Lewis & Bockius LLP, counsel for the Buyer, in form and substance reasonably satisfactory to the Shareholder. 7.7 Litigation Affecting Closing. No Court Order shall have been issued or entered which would be prohibits the completion of the Acquisition. No person who or which is not a party to this Agreement shall have commenced or threatened to commence any Litigation seeking to restrain or prohibit, or to obtain substantial damages in connection with, this Agreement or the transactions contemplated by this Agreement. 7.8 Regulatory Compliance and Approval. All approvals required under any Regulations to carry out the Acquisition shall have been obtained and that the Buyer shall have complied in all material respects with all Regulations applicable to the Acquisition. 7.9 Special Committee. The Special Committee shall have approved on behalf of the Master Partnership (i) the form of opinion of Morgan, Lewis & Bockius LLP relating to the satisfaction by the Buyer of the Company's capital requirement in compliance with Sections 17.6 and 19.1 of the Master Partnership Agreement after giving effect to the cancellation of the Demand Notes, (ii) cancellation of the Demand Notes effective at the Closing and (iii) the Buyer's employee stock ownership plan as a fringe benefit, the cost of which may be reasonably allocated to the Partnership pursuant to Section 7.4 of the Master Partnership Agreement. ARTICLE 8 MISCELLANEOUS 8.1 No Survival of Representation and Warranties. None of the representations, warranties, covenants and agreements made by each party in this Agreement or in any attachment, Exhibit, certificate, document or list delivered by any such party pursuant hereto or in connection with the Acquisition shall survive the Closing. 8.2 Payment of Expenses. The Buyer shall pay all legal, accounting and other fees and expenses which it incurs in connection with this Agreement and the transactions contemplated hereby, and all legal, accounting and other fees and expenses incurred by the Shareholder in connection with this Agreement shall be paid by the Shareholder (other than expenses and costs -19- incurred for, by or on account of employees of the Company or the Company's auditors and other than expenses and costs, including without limitation reasonable attorney's fees, related to the securing of all requisite Regulatory Approvals, all of which shall be paid by the Company). 8.3 Termination. This Agreement may be terminated before the Closing occurs only as follows: (a) By written consent of the Shareholder and the Buyer; (b) By written notice by the Shareholder to the Buyer at any time after February 22, 1996, unless on or prior thereto the Buyer shall have provided the Shareholder with satisfactory evidence that the Special Committee has approved the matters described in Section 7.9 hereof; (c) By written notice by the Shareholder to the Buyer at any time after February 22, 1996, unless on or prior thereto the Buyer shall have delivered to the Shareholder written confirmation from Prudential Capital Group that the Finance Committee of the Board of Directors of The Prudential Insurance Company of America has authorized Prudential Capital Group to purchase a note or notes in accordance with the Prudential Commitment Letter; (d) By written notice by the Shareholder to the Buyer, at any time after April 15, 1995, except that no such notice may be given under this clause (d) if as of the date of such notice the only condition specified in Article 7 that is not satisfied or able to be satisfied is the condition specified in Section 7.8; or (e) By written notice by the Shareholder or the Buyer to the other at any time after June 30, 1995. 8.4 Brokers' and Finders' Fees. The Shareholder and the Buyer each to the other represents and warrants that all negotiations relative to this Agreement have been carried on by them directly without the intervention of any person, firm, corporation or other entity who or which may be entitled to any brokerage fee or other commission in respect of the execution of this Agreement or the consummation of the transactions contemplated hereby except for (i) Furman Selz LLC, whose fees shall be paid by the Shareholder and (ii) Houlihan, Lokey, Howard & Zukin, Inc., whose fees shall be paid by the Buyer, and each of them shall indemnify and hold the other or any affiliate of them harmless against any and all claims, losses, liabilities or expenses which may be asserted against any of them as a result of any dealings, arrangements or agreements by the indemnifying party with any such person, firm, corporation or other entity. 8.5 Assignment and Binding Effect. This Agreement may not be assigned prior to the Closing by any party hereto without the prior written consent of the other parties. Subject to the foregoing, all of the terms and provisions of this Agreement shall be binding upon and inure to the benefit of and be enforceable by the successors and assigns of the Shareholder and by the successors and assigns of the Buyer. -20- 8.6 Waiver. Any term or provision of this Agreement may be waived at any time by the party entitled to the benefit thereof by a written instrument executed by such party. 8.7 Notices. Any notice, request, demand, waiver, consent, approval or other communication which is required or permitted hereunder shall be in writing and shall be deemed given only if delivered personally to the address set forth below (to the attention of the person identified below) or sent by facsimile message, Federal Express (or other reputable overnight delivery service) or by registered or certified mail, postage prepaid, as follows: If to the Buyer, to: BMC Acquisition Company 5 Radnor Corporate Center 100 Matson Ford Road Radnor, PA 19087 Attention: A. W. Martinelli With required copies to: Buckeye Management Company If by mail: If by Federal Express: P.O. Box 368 3900 Hamilton Boulevard Emmaus, PA 18049 Allentown, PA 18103 Attention: Stephen C. Muther, Esquire If to the Shareholder, to: American Financial Group, Inc. One East Fourth Street Cincinnati, OH 45202 Attention: Neil M. Hahl With a required copy to the Corporate Secretary of the Shareholder at the same address. or to such other address as the addressee may have specified in a notice duly given to the sender as provided herein. Such notice, request, demand, waiver, consent, approval or other communication will be deemed to have given as of the date so delivered or sent by facsimile message, the day after the date sent when sent by Federal Express (or other reputable overnight delivery service), or, if mailed, three business days after the date so mailed. -21- 8.8 Pennsylvania Law to Govern. This Agreement shall be governed by and interpreted and enforced in accordance with the substantive laws of the Commonwealth of Pennsylvania applicable to contracts made and to be performed in that Commonwealth. 8.9 Remedies Not Exclusive. Nothing in this Agreement shall be deemed to limit or restrict in any manner other rights or remedies that any party may have against any other party at law, in equity or otherwise. 8.10 No Benefit to Others. The representations, warranties, covenants and agreements contained in this Agreement are for the sole benefit of the parties hereto and the Company and their successors and assigns, and they shall not be construed as conferring and are not intended to confer any rights on any other persons. 8.11 Contents of Agreement. This Agreement sets forth the entire agreement of the parties hereto with respect to the transactions contemplated hereby. This Agreement may not be amended except by an instrument in writing signed by the parties hereto, and no claimed amendment, modification, termination or waiver shall be binding unless in writing and signed by the party against whom or which such claimed amendment, modification, termination or waiver is sought to be enforced. The Shareholder agrees that upon request of the Buyer, it will amend this Agreement and take such other action as may be necessary to modify the structure of the transaction contemplated hereby from a stock purchase to a partial stock purchase and partial stock redemption, except that the Shareholder shall be so obligated only if such modification will not have an adverse effect on the Shareholder or its affiliates. 8.12 Section Headings and Gender. All section headings and the use of a particular gender are for convenience only and shall in no way modify or restrict any of the terms or provisions hereof. Any reference in this Agreement to a Section, Annex or Exhibit shall be deemed to be a reference to a Section, Annex or Exhibit of this Agreement unless the context otherwise expressly requires. 8.13 Cooperation. Subject to the provisions hereof, the parties hereto shall use their reasonable efforts to take, or cause to be taken, such action, to execute and deliver, or cause to be executed and delivered, such additional documents and instruments and to do, or cause to be done, all things necessary, proper or advisable under the provisions of this Agreement and under applicable law to consummate and make effective the transactions contemplated by this Agreement. 8.14 Severability. Any provision of this Agreement which is invalid or unenforceable in any jurisdiction shall be ineffective to the extent of such invalidity or unenforceability without invalidating or rendering unenforceable the remaining provisions hereof, and any such invalidity or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. -22- 8.15 Counterparts. This Agreement may be executed in two or more counterparts, each of which is an original and all of which together shall be deemed to be one and the same instrument. This Agreement shall become binding when one or more counterparts taken together shall have been executed and delivered by all of the parties. It shall not be necessary in making proof of this Agreement or any counterpart hereof to produce or account for any of the other counterparts. IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the date first written above. PENNSYLVANIA COMPANY By: /s/ Neil M. Hahl Title: Senior Vice President BMC ACQUISITION COMPANY By: /s/ A.W. Martinelli Title: Chairman -23- ANNEX I CERTAIN DEFINED TERMS "Acquisition" means the acquisition of all of the Shares by the Buyer and all related transactions provided for in or contemplated by this Agreement. "Agreement" means this Share Purchase Agreement. "Buyer" means BMC, a Delaware corporation. "Company Material Adverse Effect" shall mean a material adverse change in, or material adverse effect on, the results of operations, financial condition or business of the Company and the Management Subsidiary, taken as a whole; but in any case after application of the proceeds of any insurance or indemnity under any contract or agreement with any third party. "Contract" means any written or oral contract, agreement, lease, instrument or other commitment that is binding on any person or its property under applicable law. "Court Order" means any judgment, decree, injunction, order or ruling of any federal, state or local court or governmental or regulatory body or authority that is binding on any person or its property under applicable law. "Default" means (1) a material breach of or material default under any Contract, (2) the occurrence of an event that with the passage of time or the giving of notice or both would constitute a material breach of or material default under any Contract, or (3) the occurrence of an event that with or without the passage of time or the giving of notice or both would give rise to a right of termination, renegotiation or acceleration under any Contract. "Demand Notes" mean that certain Demand Promissory Note, dated November 18, 1986, in the aggregate principal amount of $24,000,000, by the Shareholder to the Company, and that certain Demand Promissory Note, dated December 23, 1986, in the aggregate principal amount of $4,000,000, by the Shareholder to the Company. "Employee Benefit Plans" means "employee benefit plans" as defined in section 3(3) of ERISA and any other plan, policy, program, practice or arrangement providing benefits to any officer or employee of the Company, the Management Subsidiary, or any dependent or beneficiary thereof, which are now maintained by the Company or the Management Subsidiary, or under which the Company or the Management Subsidiary has any obligation or liability, including, without limitation, all incentive, bonus, deferred compensation, medical, disability, share purchase, unit purchase, retirement or other similar plans, policies, programs, practices or arrangements; provided, however, that such term shall not include (i) any employment agreements entered into by the Company or the Management Subsidiary with their respective employees, or (ii) any regular payroll practices of the Company or the Management Subsidiary. "ERISA" means the Employee Retirement Income Security Act of 1974, as amended. "Insured Losses" shall mean Losses under the Policies and any related loss adjustment expense, including attorney fees and claims administration and handling costs. "IRS" means the Internal Revenue Service. "Liability" means any direct or indirect liability, indebtedness, obligation, expense, claim, deficiency, guaranty or endorsement of or by any person (other than endorsements of notes, bills and checks presented to banks for collection or deposit in the ordinary course of business). "Licenses" means licenses, franchises, permits, easements, rights and other authorizations. "Lien" means any mortgage, lien, security interest, pledge, encumbrance, restriction on transferability, defect of title, charge or claim of any nature whatsoever on any property or property interest. "Litigation" means any lawsuit, action, arbitration, administrative or other proceeding, criminal prosecution or governmental investigation or inquiry involving the Company, the Management Subsidiary, their respective businesses or assets, or any Contracts to which the Company or the Management Subsidiary is a party or by which it or any of their respective businesses or assets may be bound. "Loss" or "Losses" shall mean: liabilities, damages, costs, judgments, costs of investigating claims, amounts paid in settlement, interest, penalties, assessments and out-of-pocket expenses (including reasonable attorneys' and auditors' and actuaries' fees) actually incurred. "Master Partnership" means Buckeye Partners, L.P., a Delaware limited partnership. "Master Partnership Agreement" means that certain Amended and Restated Agreement of Limited Partnership of the Master Partnership, dated as of December 23, 1986. "Operating Partnerships" means Buckeye Pipe Line Company, L.P., a Delaware limited partnership, Buckeye Pipe Line Company of Michigan, L.P., a Delaware limited partnership, Buckeye Tank Terminals Company, L.P., a Delaware limited partnership, Everglades Pipe Line Company, L.P., a Delaware limited partnership, and Laurel Pipe Line Company, L.P., a Delaware limited partnership. "Regulation" means any statute, law, ordinance, regulation, order or rule of any federal, state, local or other governmental agency or body or of any other type of regulatory body, including, without limitation, those covering environmental, energy, safety, health, transportation, bribery, recordkeeping, zoning, antidiscrimination, antitrust, wage and hour, and price and wage control matters. "Retention Levels" shall mean the retention levels specified in the Policies for the respective companies, time periods and types of insurance coverage specified thereon. INDEX OF DEFINED TERMS Acquisition 26 Agreement 26 Buyer 1 Buyer Documents 5 Closing 2 Closing Date. 2 Code 1 Common Stock 1 Company 1 Company Material Adverse Effect 26 Contract 26 Court Order 26 Default 26 Demand Notes 26 Employee Benefit Plans 26 ERISA 27 Financial Information 6 Fixed Income Trust 14 Insured Losses 27 IRS 27 Liability 27 Licenses 27 Lien 27 Litigation 27 Loss or Losses 27 Management Subsidiary 4 Master DB Trust 13 Master Partnership 27 Master Partnership Agreement 27 Operating Partnerships 28 Plan Sponsor 13 Policies 14 Prudential Commitment Letter 6 Purchase Price 2 RASP 13 Regulation 28 Retention Levels 28 RIGP 13 Shareholder 1 Shareholder Documents 3 Shares 1 Special Committee 19 Tax Benefits 12 Tax Detriments 12 SCHEDULE 4.1 (Names of subscribers for common stock) Alfred W. Martinelli C. Richard Wilson Stephen C. Muther Steven C. Ramsey Michael P. Epperly AMENDMENT TO SHARE PURCHASE AGREEMENT THIS AMENDMENT is made as of this 22nd day of March, 1996 by Pennsylvania Company, a Delaware corporation (the "Shareholder") and BMC Acquisition Company, a Delaware corporation (the "Buyer"). WHEREAS, the Shareholder and the Buyer have entered into a Share Purchase Agreement (the "Agreement") dated as of January 5, 1996 providing for the acquisition of all of the issued and outstanding shares of capital stock of Buckeye Management Company, a Delaware corporation ("Company") by the Buyer from the Shareholder; and WHEREAS, the Shareholder and the Buyer desire to amend the Agreement as set forth in this Amendment. NOW, THEREFORE, intending to be legally bound, the parties hereto agree as follows: 1. The Shareholder and the Buyer hereby agree that, prior to the Closing, the Buyer may terminate the existing subscription agreements from the persons listed on the form of Schedule 4.1 originally attached to the Agreement and simultaneously enter into a new subscription agreement with Glenmoor Partners, LLP, a Pennsylvania limited liability partnership, to acquire not less than $5,000,000 of common stock of the Buyer on or before the Closing Date. 2. The Shareholder and the Buyer hereby agree that the date "April 15, 1995" in Section 8.3(d) and the date "June 30, 1995" in Section 8.3(e) were intended to be and are hereby amended to be "April 15, 1996" and "June 30, 1996" respectively. 3. The Shareholder and the Buyer hereby agree that Section 8.1 of the Agreement shall be amended to insert the phrase "Except as otherwise specifically set forth in this Agreement in the case of covenants and agreements," at the beginning of such section. 4. Buyer shall use commercially reasonable efforts to obtain as soon as practicable following the Closing Date, but in no event later than August 14, 1996, the release of Shareholder and its affiliates from all surety bonds for which Shareholder or any of its affiliates is a guarantor or an account party, but which relate to the operations of the Company, the Master Partnership and the Operating Partnerships. Shareholder agrees to keep any such surety bonds in place until August 14, 1996, after which time Shareholder or its affiliates may give notice of cancellation with respect to their guaranty. Buyer agrees to indemnify and hold harmless Seller and its affiliates from any loss arising out of such surety bonds. 5. All capitalized terms used in this Amendment but not defined herein shall have the same meaning as such term has in the Agreement. 6. Any provision of this Amendment that is inconsistent with the provisions of the Agreement shall be deemed amended to effectuate the intention of the parties as expressed herein. Every other provision of the Agreement shall remain unchanged and shall remain in full force and effect. 7. This Amendment may be executed in two or more counterparts, each of which is an original, and all of which together shall be deemed to be one and the same instrument. This Amendment shall become binding when one or more counterparts taken together shall have been executed and delivered by both of the parties. It shall not be necessary in making proof of this Amendment or any counterpart hereof to produce or account for any of the other counterparts. IN WITNESS WHEREOF, the parties hereto have duly executed this Amendment as of the date first written above. PENNSYLVANIA COMPANY By: /s/ Neil M. Hahl Name: Neil M. Hahl Title: Senior Vice President BMC ACQUISITION COMPANY By: /s/ C. Richard Wilson Name: C. Richard Wilson Title: President EX-28 12 EXHIBIT 28 STATE INSURANCE AMERICAN FINANCIAL INSURANCE GROUP SCHEDULE P - ANALYSIS OF LOSSES AND LOSS EXPENSES NOTES TO SCHEDULE P 1. THE PARTS OF SCHEDULE P: PART 1 - DETAILED INFORMATION ON LOSSES AND LOSS EXPENSES. PART 2 - HISTORY OF INCURRED LOSSES AND ALLOCATED EXPENSES. PART 3 - HISTORY OF LOSS AND ALLOCATED EXPENSE PAYMENTS. PART 4 - HISTORY OF BULK AND INCURRED-BUT-NOT-REPORTED RESERVES. PART 5 - HISTORY OF CLAIMS. PART 6 - HISTORY OF PREMIUMS EARNED. PART 7 - HISTORY OF LOSS SENSITIVE CONTRACTS. SCHEDULE P INTERROGATORIES. 2. LINES OF BUSINESS A THROUGH M, R & S ARE GROUPINGS OF THE LINES OF BUSINESS USED ON THE STATE PAGE. 3. REINSURANCE A, B, C, AND D (LINES N TO Q) ARE: REINSURANCE A = NONPROPORTIONAL PROPERTY (1988 AND SUBSEQUENT) REINSURANCE B = NONPROPORTIONAL LIABILITY (1988 AND SUBSEQUENT) REINSURANCE C = FINANCIAL LINES (1988 AND SUBSEQUENT) REINSURANCE D = OLD SCHEDULE O LINE 30 (1987 AND PRIOR) SCHEDULE P - PART 1 - SUMMARY ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 70,112 34,741 17,825 02 1986 2,281,532 443,245 1,838,288 1,092,788 193,759 100,278 03 1987 2,243,964 364,196 1,879,768 1,060,511 158,565 102,368 04 1988 2,227,970 302,127 1,925,843 1,157,810 147,600 97,059 05 1989 2,153,293 239,026 1,914,276 1,224,595 135,773 95,811 06 1990 2,353,869 245,072 2,108,797 1,376,884 184,938 106,707 07 1991 2,511,087 307,339 2,203,748 1,300,840 142,362 104,065 08 1992 2,708,653 369,869 2,338,784 1,358,878 201,656 98,035 09 1993 3,060,302 497,436 2,562,866 1,369,357 200,740 88,208 10 1994 3,627,461 712,954 2,914,507 1,666,762 339,189 77,389 11 1995 3,879,571 875,363 3,004,207 1,243,959 303,724 35,712 12 TOTAL XXX XXX XXX 12,922,494 2,043,032 923,460 SCHEDULE P - PART 1 - SUMMARY 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 8,501 1,910 2,946 47,649 XXX 335,838 02 1986 21,211 30,073 84,344 1,062,440 XXX 21,282 03 1987 23,010 30,992 86,609 1,067,905 XXX 43,863 04 1988 10,243 36,520 92,181 1,189,208 XXX 70,076 05 1989 9,374 38,089 101,329 1,276,588 XXX 46,026 06 1990 8,450 42,968 105,259 1,395,472 XXX 47,451 07 1991 10,001 39,655 111,071 1,363,622 XXX 71,927 08 1992 13,588 42,008 115,269 1,356,939 XXX 105,910 09 1993 14,245 46,362 116,117 1,358,697 XXX 190,542 10 1994 18,049 43,979 123,761 1,510,675 XXX 425,194 11 1995 7,885 25,922 104,310 1,072,371 XXX 788,625 12 TOTAL 144,541 378,486 1,043,187 12,701,572 XXX 2,146,731 SCHEDULE P - PART 1 - SUMMARY 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 138,108 261,683 138,396 17,718 7,836 35,169 02 1986 7,616 18,478 4,741 2,286 558 3,143 03 1987 24,363 24,176 16,337 3,623 1,568 3,094 04 1988 28,774 16,474 1,997 9,106 3,633 4,259 05 1989 10,602 43,489 16,433 3,340 327 12,376 06 1990 7,047 53,856 16,986 5,749 586 14,184 07 1991 8,839 67,494 18,413 9,441 1,259 14,163 08 1992 13,594 94,170 32,106 12,992 1,235 20,453 09 1993 26,143 217,651 51,744 27,433 4,417 42,720 10 1994 80,144 230,610 40,646 47,636 8,271 51,641 11 1995 130,675 555,539 86,599 80,150 18,280 83,965 12 TOTAL 475,915 1,583,627 424,389 219,474 47,956 285,177 SCHEDULE P - PART 1 - SUMMARY 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 12,510 0 17,911 371,468 XXX XXX 02 1986 1,252 4 2,566 33,588 XXX 1,328,696 03 1987 1,535 4 1,937 32,899 XXX 1,328,525 04 1988 633 706 1,969 66,838 XXX 1,450,353 05 1989 5,105 1,202 3,005 75,776 XXX 1,533,797 06 1990 4,576 2,211 5,870 97,907 XXX 1,720,549 07 1991 4,769 3,378 7,489 137,232 XXX 1,691,462 08 1992 6,393 5,990 9,916 190,109 XXX 1,822,029 09 1993 8,307 7,990 25,172 412,907 XXX 2,084,820 10 1994 6,853 16,498 40,955 660,132 XXX 2,672,023 11 1995 12,124 41,585 69,736 1,330,339 XXX 2,971,402 12 TOTAL 64,054 79,561 186,519 3,409,203 XXX XXX SCHEDULE P - PART 1 - SUMMARY 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 14,965 02 1986 232,669 1,096,027 58.237 52.492 59.622 0 03 1987 227,712 1,100,813 59.204 62.525 58.561 0 04 1988 194,300 1,256,053 65.098 64.311 65.221 0 05 1989 181,436 1,352,361 71.230 75.906 70.646 0 06 1990 227,170 1,493,379 73.095 92.695 70.817 0 07 1991 190,610 1,500,852 67.360 62.019 68.105 0 08 1992 274,980 1,547,049 67.267 74.345 66.148 0 09 1993 313,216 1,771,604 68.125 62.966 69.126 0 10 1994 501,218 2,170,805 73.661 70.302 74.483 0 11 1995 568,683 2,402,719 76.591 64.965 79.978 0 12 TOTAL XXX XXX XXX XXX XXX 14,965 SCHEDULE P - PART 1 - SUMMARY 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 306,052 50,460 02 1986 0 .000 27,402 6,186 03 1987 0 .000 27,339 5,560 04 1988 0 .000 55,770 11,068 05 1989 0 .000 62,487 13,288 06 1990 0 .000 77,273 20,633 07 1991 0 .000 112,167 25,067 08 1992 0 .000 154,377 35,739 09 1993 0 .000 330,316 82,591 10 1994 0 .000 535,015 125,108 11 1995 0 .000 1,126,892 203,449 12 TOTAL 0 XXX 2,815,090 579,149 SCHEDULE P - PART 1A - HOMEOWNERS/FARMOWNERS ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 146 2 73 02 1986 99,292 4,359 94,933 52,628 1,041 1,634 03 1987 84,274 3,855 80,419 42,258 1,100 1,220 04 1988 83,433 3,509 79,924 46,440 1,125 1,071 05 1989 88,257 3,394 84,863 68,548 6,352 2,235 06 1990 97,693 3,468 94,225 56,977 1,484 3,510 07 1991 104,735 4,134 100,601 65,175 1,763 3,475 08 1992 98,838 5,154 93,684 56,913 4,228 2,674 09 1993 93,698 6,757 86,941 57,086 3,030 2,413 10 1994 99,208 14,184 85,024 61,967 5,697 1,371 11 1995 106,819 16,636 90,183 52,109 7,938 679 12 TOTAL XXX XXX XXX 560,248 33,760 20,361 SCHEDULE P - PART 1A - HOMEOWNERS/FARMOWNERS 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 0 130 3 220 XXX 1,201 02 1986 71 1,100 4,573 57,723 31,621 0 03 1987 34 667 4,191 46,535 22,942 33 04 1988 15 638 3,269 49,640 21,954 15 05 1989 23 727 4,284 68,692 30,817 149 06 1990 0 1,370 3,234 62,237 25,617 378 07 1991 0 952 3,460 70,347 28,419 703 08 1992 5 531 4,165 59,519 22,271 1,451 09 1993 51 415 5,246 61,664 23,205 2,449 10 1994 104 623 4,854 62,391 27,639 2,255 11 1995 66 251 3,498 48,282 22,483 8,652 12 TOTAL 368 7,403 40,786 587,267 XXX 17,294 SCHEDULE P - PART 1A - HOMEOWNERS/FARMOWNERS 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 0 253 5 13 0 0 02 1986 0 12 0 0 0 0 03 1987 0 0 0 1 0 0 04 1988 0 -1 0 0 0 0 05 1989 0 0 -1 19 0 -5 06 1990 0 -54 -3 41 0 0 07 1991 0 -33 -5 80 0 0 08 1992 55 -79 -6 152 0 0 09 1993 2 -114 -14 283 0 0 10 1994 156 1,079 64 275 18 110 11 1995 399 8,297 568 1,097 53 1,109 12 TOTAL 612 9,357 607 1,969 71 1,214 SCHEDULE P - PART 1A - HOMEOWNERS/FARMOWNERS 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 0 0 15 1,478 20 XXX 02 1986 0 0 0 12 0 58,935 03 1987 0 0 5 40 0 47,785 04 1988 0 2 3 18 0 50,850 05 1989 0 12 8 171 5 75,335 06 1990 0 52 25 394 10 64,271 07 1991 0 85 45 800 25 73,058 08 1992 0 96 80 1,564 49 65,529 09 1993 0 202 141 2,778 83 67,736 10 1994 7 278 201 3,682 159 72,475 11 1995 74 585 1,217 19,277 1,832 76,934 12 TOTAL 81 1,312 1,751 30,214 2,199 XXX SCHEDULE P - PART 1A - HOMEOWNERS/FARMOWNERS 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 540 02 1986 1,201 57,734 59.355 27.552 60.815 0 03 1987 1,209 46,576 56.701 31.361 57.916 0 04 1988 1,192 49,658 60.947 33.969 62.131 0 05 1989 6,470 68,865 85.358 190.630 81.148 0 06 1990 1,639 62,632 65.788 47.260 66.470 0 07 1991 1,904 71,154 69.755 46.057 70.728 0 08 1992 4,445 61,084 66.299 86.243 65.202 0 09 1993 3,294 64,442 72.291 48.749 74.121 0 10 1994 6,402 66,073 73.053 45.135 77.710 0 11 1995 9,376 67,558 72.022 56.359 74.912 0 12 TOTAL XXX XXX XXX XXX XXX 540 SCHEDULE P - PART 1A - HOMEOWNERS/FARMOWNERS 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 910 28 02 1986 0 .000 12 0 03 1987 0 .000 33 6 04 1988 0 .000 14 3 05 1989 0 .000 148 23 06 1990 0 .000 328 66 07 1991 0 .000 674 126 08 1992 0 .000 1,323 233 09 1993 0 .000 2,346 424 10 1994 0 .000 3,113 569 11 1995 0 .000 15,981 3,296 12 TOTAL 0 XXX 24,882 4,774 SCHEDULE P - PART 1B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 2,534 1,613 63 02 1986 297,892 43,001 254,891 218,907 30,042 12,412 03 1987 298,607 23,834 274,773 210,398 10,287 13,166 04 1988 358,332 25,904 332,429 259,401 19,060 16,393 05 1989 388,984 7,615 381,368 289,226 12,626 18,712 06 1990 479,335 8,101 471,235 361,025 26,867 24,044 07 1991 592,849 44,309 548,540 385,533 22,793 21,794 08 1992 702,598 47,425 655,181 427,241 21,306 21,527 09 1993 842,376 78,687 763,689 503,211 39,574 22,162 10 1994 1,081,173 174,703 906,469 620,378 103,394 21,004 11 1995 1,255,643 256,776 998,866 387,568 81,207 8,897 12 TOTAL XXX XXX XXX 3,665,410 368,763 180,183 SCHEDULE P - PART 1B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 190 21 96 889 XXX 4,209 02 1986 2,012 2,876 13,469 212,741 127,038 133 03 1987 512 3,115 15,828 228,601 125,249 253 04 1988 1,278 4,099 18,696 274,160 115,232 241 05 1989 1,347 5,182 22,693 316,659 125,708 1,366 06 1990 663 6,512 26,771 384,298 154,771 3,884 07 1991 1,505 7,409 30,953 413,980 171,842 4,576 08 1992 1,451 8,980 34,435 460,444 192,824 11,518 09 1993 2,356 10,333 39,984 523,434 242,250 31,678 10 1994 4,958 8,358 44,411 577,434 330,243 104,829 11 1995 1,784 3,691 37,268 350,742 337,147 328,671 12 TOTAL 18,068 60,563 284,602 3,743,367 XXX 491,346 SCHEDULE P - PART 1B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 556 838 0 151 87 0 02 1986 0 270 211 85 0 -9 03 1987 0 -542 0 54 0 0 04 1988 0 -161 0 61 0 -5 05 1989 0 -11 0 255 0 3 06 1990 408 496 -1 623 61 107 07 1991 242 426 1 707 37 237 08 1992 172 5,805 415 1,869 12 806 09 1993 1,500 11,728 739 5,998 283 1,157 10 1994 12,761 36,278 6,468 14,823 2,529 5,492 11 1995 56,720 152,043 20,916 34,237 8,648 16,892 12 TOTAL 72,357 207,178 28,748 58,863 11,659 24,687 SCHEDULE P - PART 1B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 0 0 41 4,597 118 XXX 02 1986 0 0 9 277 4 246,455 03 1987 0 0 7 -229 9 239,827 04 1988 0 9 13 150 23 295,277 05 1989 0 18 87 1,701 66 333,174 06 1990 0 84 247 4,891 153 417,958 07 1991 0 160 272 5,939 411 445,256 08 1992 12 627 910 20,301 1,127 504,564 09 1993 55 1,385 2,268 50,249 3,991 618,687 10 1994 144 3,736 6,529 146,058 17,036 854,692 11 1995 457 8,658 26,175 471,285 77,037 992,889 12 TOTAL 668 14,685 36,567 705,207 99,991 XXX SCHEDULE P - PART 1B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 1,088 02 1986 33,437 213,018 82.733 77.759 83.572 0 03 1987 11,456 228,371 80.315 48.066 83.113 0 04 1988 20,966 274,311 82.403 80.937 82.517 0 05 1989 14,821 318,353 85.652 194.629 83.477 0 06 1990 28,762 389,196 87.195 355.043 82.591 0 07 1991 25,339 419,917 75.104 57.187 76.552 0 08 1992 23,818 480,746 71.814 50.222 73.376 0 09 1993 45,015 573,672 73.445 57.208 75.119 0 10 1994 131,203 723,489 79.052 75.101 79.814 0 11 1995 170,871 822,018 79.074 66.545 82.295 0 12 TOTAL XXX XXX XXX XXX XXX 1,088 SCHEDULE P - PART 1B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 3,405 105 02 1986 0 .000 192 85 03 1987 0 .000 -289 61 04 1988 0 .000 81 69 05 1989 0 .000 1,356 346 06 1990 0 .000 3,973 917 07 1991 0 .000 4,760 1,179 08 1992 0 .000 16,736 3,565 09 1993 0 .000 41,167 9,081 10 1994 0 .000 121,886 24,173 11 1995 0 .000 403,079 68,206 12 TOTAL 0 XXX 596,346 107,787 SCHEDULE P - PART 1C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 382 379 501 02 1986 199,568 46,150 153,411 104,038 15,994 9,213 03 1987 192,604 33,679 158,925 98,413 10,358 6,987 04 1988 177,929 19,651 158,271 106,228 12,573 12,720 05 1989 173,088 16,078 157,010 118,836 17,333 13,958 06 1990 172,720 27,431 145,280 111,921 22,812 14,299 07 1991 156,610 30,267 126,344 75,759 12,349 8,338 08 1992 181,790 61,881 119,908 81,285 27,380 11,183 09 1993 193,879 64,654 129,224 81,396 24,995 11,669 10 1994 200,607 67,314 133,294 65,479 28,436 8,731 11 1995 181,296 49,699 131,597 24,321 3,582 1,872 12 TOTAL XXX XXX XXX 868,052 176,183 99,459 SCHEDULE P - PART 1C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 330 751 -1 172 XXX 11,359 02 1986 1,415 1,268 8,913 104,754 20,667 58 03 1987 925 556 9,850 103,974 20,130 119 04 1988 2,179 1,339 10,542 114,729 21,632 1,755 05 1989 2,549 837 11,116 124,027 21,932 1,115 06 1990 4,553 1,169 10,311 109,167 19,372 2,448 07 1991 1,491 649 7,845 78,098 17,011 8,101 08 1992 4,533 609 7,396 67,945 16,973 12,983 09 1993 4,738 522 6,349 69,687 21,479 24,211 10 1994 5,194 578 5,073 45,649 25,261 44,655 11 1995 558 217 3,677 25,729 19,539 48,255 12 TOTAL 28,474 8,521 81,067 843,931 XXX 155,058 SCHEDULE P - PART 1C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 1,914 4,016 3,242 29 17 47 02 1986 0 3,281 524 1 0 102 03 1987 21 1,270 345 4 0 172 04 1988 857 506 583 74 12 233 05 1989 534 947 469 75 46 402 06 1990 1,161 3,270 1,526 253 107 302 07 1991 4,062 8,697 3,062 1,373 707 1,238 08 1992 5,604 12,894 5,374 1,335 414 1,568 09 1993 8,667 19,968 8,652 3,455 872 2,686 10 1994 16,740 24,445 8,083 4,251 1,202 3,133 11 1995 15,559 35,482 8,635 4,294 1,217 4,500 12 TOTAL 55,119 114,781 40,489 15,143 4,596 14,384 SCHEDULE P - PART 1C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR -3 0 103 10,393 78 XXX 02 1986 73 0 8 2,853 1 125,762 03 1987 102 0 2 1,099 4 117,006 04 1988 179 1 47 985 16 132,315 05 1989 345 5 39 1,183 32 146,817 06 1990 259 65 118 3,342 71 143,293 07 1991 763 78 366 11,180 146 112,086 08 1992 689 109 578 17,276 359 129,762 09 1993 1,372 190 1,233 31,997 967 151,515 10 1994 1,020 324 2,418 51,857 2,181 158,717 11 1995 1,169 565 3,873 69,823 4,896 126,817 12 TOTAL 5,977 1,347 8,792 201,972 8,768 XXX SCHEDULE P - PART 1C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 4,858 02 1986 18,154 107,608 63.017 39.337 70.144 0 03 1987 11,932 105,074 60.750 35.429 66.115 0 04 1988 16,606 115,709 74.364 84.505 73.108 0 05 1989 21,609 125,208 84.822 134.401 79.745 0 06 1990 30,784 112,509 82.963 112.223 77.443 0 07 1991 22,810 89,276 71.570 75.363 70.661 0 08 1992 44,543 85,219 71.380 71.982 71.070 0 09 1993 49,832 101,683 78.149 77.075 78.687 0 10 1994 61,211 97,506 79.118 90.934 73.151 0 11 1995 31,263 95,554 69.950 62.905 72.611 0 12 TOTAL XXX XXX XXX XXX XXX 4,858 SCHEDULE P - PART 1C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 5,370 165 02 1986 0 .000 2,815 38 03 1987 0 .000 1,023 76 04 1988 0 .000 822 163 05 1989 0 .000 1,059 124 06 1990 0 .000 3,035 307 07 1991 0 .000 9,674 1,506 08 1992 0 .000 14,899 2,377 09 1993 0 .000 26,860 5,138 10 1994 0 .000 44,278 7,581 11 1995 0 .000 59,542 10,281 12 TOTAL 0 XXX 169,377 27,756 SCHEDULE P - PART 1D - WORKERS' COMPENSATION ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 24,433 10,048 2,838 02 1986 427,544 24,044 403,499 261,433 7,660 17,424 03 1987 433,195 30,016 403,172 257,073 8,372 17,072 04 1988 505,610 36,569 469,041 284,000 9,722 18,644 05 1989 499,237 18,041 481,189 289,903 10,882 18,560 06 1990 519,315 22,015 497,300 316,788 14,477 21,776 07 1991 534,013 38,500 495,512 286,325 15,463 25,576 08 1992 575,303 47,467 527,835 238,573 20,368 21,706 09 1993 617,537 48,345 569,192 192,483 15,335 13,999 10 1994 639,203 35,089 604,114 155,595 9,297 8,748 11 1995 475,226 24,132 451,094 66,886 3,594 2,578 12 TOTAL XXX XXX XXX 2,373,494 125,225 168,904 SCHEDULE P - PART 1D - WORKERS' COMPENSATION 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 806 375 1,535 17,945 XXX 153,306 02 1986 700 3,288 25,563 296,060 81,844 10,937 03 1987 455 3,404 26,370 291,674 79,264 11,177 04 1988 510 3,552 29,723 322,127 78,268 61,630 05 1989 696 4,917 29,328 326,211 70,507 33,800 06 1990 929 6,027 31,538 354,696 71,325 25,025 07 1991 1,559 3,742 33,394 328,273 63,455 35,426 08 1992 1,989 2,765 32,035 269,958 60,671 45,951 09 1993 1,131 3,162 30,396 220,403 56,840 67,942 10 1994 256 566 28,939 183,730 61,106 120,609 11 1995 56 114 20,281 86,095 50,330 164,047 12 TOTAL 9,094 31,913 289,100 2,697,170 XXX 729,843 SCHEDULE P - PART 1D - WORKERS' COMPENSATION 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 70,869 21,521 7,340 4,892 2,398 1,087 02 1986 2,779 1,342 35 352 44 358 03 1987 3,849 2,294 1 380 18 680 04 1988 26,655 2,147 -2 7,304 3,518 853 05 1989 8,358 4,052 567 677 47 1,720 06 1990 3,261 5,986 773 717 107 1,697 07 1991 3,232 7,732 1,785 785 177 2,175 08 1992 4,014 10,344 3,458 841 307 4,483 09 1993 3,959 51,327 5,071 797 304 22,470 10 1994 5,594 61,038 6,286 922 234 24,467 11 1995 6,815 73,329 6,793 1,448 207 18,885 12 TOTAL 139,386 241,131 32,107 19,113 7,376 78,883 SCHEDULE P - PART 1D - WORKERS' COMPENSATION 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 307 0 4,675 104,566 1,762 XXX 02 1986 246 4 958 10,850 209 318,780 03 1987 374 4 894 11,191 291 316,272 04 1988 15 278 1,104 42,845 392 405,779 05 1989 43 665 1,400 32,634 513 379,824 06 1990 60 1,199 2,328 31,551 913 406,310 07 1991 184 1,608 3,477 44,217 1,514 395,641 08 1992 327 2,374 3,959 57,471 1,946 359,065 09 1993 460 2,982 15,433 148,167 2,994 396,239 10 1994 556 4,818 22,949 217,321 5,658 424,612 11 1995 616 5,451 15,748 259,026 12,137 364,433 12 TOTAL 3,195 19,385 72,932 959,825 28,370 XXX SCHEDULE P - PART 1D - WORKERS' COMPENSATION 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 538 02 1986 11,876 306,904 74.561 49.393 76.061 0 03 1987 13,410 302,862 73.009 44.676 75.120 0 04 1988 40,806 364,973 80.255 111.586 77.813 0 05 1989 20,984 358,840 76.081 116.313 74.574 0 06 1990 20,071 386,239 78.240 91.170 77.667 0 07 1991 23,151 372,490 74.088 60.132 75.173 0 08 1992 31,634 327,431 62.413 66.644 62.033 0 09 1993 27,669 368,570 64.164 57.232 64.753 0 10 1994 23,569 401,043 66.428 67.169 66.385 0 11 1995 19,304 345,129 76.686 79.993 76.509 0 12 TOTAL XXX XXX XXX XXX XXX 538 SCHEDULE P - PART 1D - WORKERS' COMPENSATION 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 96,089 7,940 02 1986 0 .000 9,464 1,386 03 1987 0 .000 9,622 1,570 04 1988 0 .000 37,125 5,729 05 1989 0 .000 28,927 3,699 06 1990 0 .000 26,968 4,582 07 1991 0 .000 38,141 6,069 08 1992 0 .000 48,822 8,641 09 1993 0 .000 110,239 37,928 10 1994 0 .000 169,768 47,554 11 1995 0 .000 223,768 35,257 12 TOTAL 0 XXX 798,933 160,355 SCHEDULE P - PART 2 - SUMMARY 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 1,169,015 1,262,585 1,362,659 1,446,879 1,483,016 1,493,589 02 1986 1,206,401 1,156,469 1,128,951 1,072,294 1,051,904 1,034,873 03 1987 XXX 1,185,350 1,153,971 1,123,080 1,086,928 1,056,742 04 1988 XXX XXX 1,261,180 1,245,225 1,259,436 1,242,104 05 1989 XXX XXX XXX 1,289,801 1,320,598 1,290,075 06 1990 XXX XXX XXX XXX 1,440,457 1,443,547 07 1991 XXX XXX XXX XXX XXX 1,480,678 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX 12 TOTAL SCHEDULE P - PART 2 - SUMMARY 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR 1,552,056 1,620,456 1,742,685 1,742,511 -174 122,055 02 1986 1,020,971 1,004,206 1,009,755 1,010,311 557 6,106 03 1987 1,045,499 1,017,521 1,011,816 1,013,554 1,740 -3,968 04 1988 1,217,374 1,204,421 1,175,241 1,162,534 -12,709 -41,879 05 1989 1,287,731 1,270,642 1,248,822 1,249,982 1,160 -20,668 06 1990 1,441,127 1,431,703 1,401,787 1,383,442 -18,353 -48,269 07 1991 1,483,940 1,471,599 1,410,874 1,383,034 -27,838 -88,565 08 1992 1,563,143 1,529,712 1,494,030 1,422,515 -71,517 -107,206 09 1993 XXX 1,695,576 1,647,428 1,630,513 -16,916 -65,063 10 1994 XXX XXX 2,020,975 2,006,397 -14,578 XXX 11 1995 XXX XXX XXX 2,228,751 XXX XXX 12 TOTAL -158,626 -247,457 SCHEDULE P - PART 3 - SUMMARY 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 402,580 665,537 864,593 1,021,105 1,121,843 02 1986 346,478 588,691 721,663 821,401 884,527 923,719 03 1987 XXX 336,896 604,084 749,650 845,514 902,043 04 1988 XXX XXX 388,570 680,174 836,076 940,833 05 1989 XXX XXX XXX 438,022 775,398 948,684 06 1990 XXX XXX XXX XXX 510,885 869,883 07 1991 XXX XXX XXX XXX XXX 547,853 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3 - SUMMARY 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR 1,200,168 1,263,730 1,323,594 1,368,294 XXX XXX 02 1986 946,059 961,091 972,200 978,104 XXX XXX 03 1987 937,004 964,862 978,312 981,295 XXX XXX 04 1988 1,005,021 1,044,520 1,085,465 1,097,033 XXX XXX 05 1989 1,051,776 1,116,597 1,154,150 1,175,267 XXX XXX 06 1990 1,071,308 1,182,559 1,249,634 1,290,212 XXX XXX 07 1991 925,916 1,100,306 1,199,467 1,252,551 XXX XXX 08 1992 586,211 979,567 1,155,245 1,241,669 XXX XXX 09 1993 XXX 663,637 1,057,400 1,242,581 XXX XXX 10 1994 XXX XXX 840,983 1,386,911 XXX XXX 11 1995 XXX XXX XXX 968,065 XXX XXX SCHEDULE P - PART 4 - SUMMARY 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 263,118 189,973 156,997 173,284 116,762 101,382 02 1986 508,715 329,004 238,572 140,252 95,547 62,201 03 1987 XXX 487,873 288,078 204,166 136,037 87,465 04 1988 XXX XXX 439,686 248,202 191,801 148,640 05 1989 XXX XXX XXX 402,226 209,434 134,966 06 1990 XXX XXX XXX XXX 432,714 222,408 07 1991 XXX XXX XXX XXX XXX 467,761 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4 - SUMMARY 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR 87,799 84,226 146,345 145,945 02 1986 38,249 16,730 17,278 15,638 03 1987 58,284 23,090 10,552 9,405 04 1988 99,997 74,915 30,941 18,102 05 1989 94,926 66,467 36,955 34,335 06 1990 150,620 104,249 68,963 46,477 07 1991 245,196 178,156 96,872 58,471 08 1992 460,968 246,682 170,190 76,123 09 1993 XXX 519,665 289,313 200,329 10 1994 XXX XXX 497,553 234,810 11 1995 XXX XXX XXX 540,782 SCHEDULE P - PART 1E - COMMERICAL MULTIPLE PERIL ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 970 188 2,204 02 1986 240,615 29,957 210,665 77,222 6,393 17,540 03 1987 245,686 27,957 217,737 87,815 9,002 14,960 04 1988 244,676 22,602 222,066 103,672 7,417 17,154 05 1989 227,933 21,826 206,114 110,880 12,861 17,034 06 1990 242,666 20,707 221,951 113,721 8,001 18,761 07 1991 234,914 21,561 213,353 117,059 11,585 17,613 08 1992 211,142 23,520 187,628 112,300 15,752 15,128 09 1993 196,490 25,469 171,021 68,751 9,485 10,286 10 1994 223,459 37,281 186,176 90,718 12,561 7,761 11 1995 261,227 52,570 208,657 53,074 12,979 3,272 12 TOTAL XXX XXX XXX 936,180 106,215 141,711 SCHEDULE P - PART 1E - COMMERICAL MULTIPLE PERIL 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 29 60 28 2,985 XXX 5,099 02 1986 1,744 2,403 7,624 94,249 14,278 1,117 03 1987 989 1,903 7,571 100,348 12,964 2,002 04 1988 867 6,415 7,901 120,444 14,427 2,732 05 1989 1,366 3,699 7,691 121,377 16,047 4,581 06 1990 1,101 2,828 8,245 131,632 16,552 7,318 07 1991 1,478 2,445 9,898 131,498 16,044 9,509 08 1992 1,103 3,794 9,758 120,330 14,717 17,232 09 1993 952 931 7,680 76,272 14,532 16,077 10 1994 894 661 6,095 91,127 16,704 26,818 11 1995 544 2,767 4,942 47,757 12,843 48,158 12 TOTAL 11,060 27,906 77,418 1,038,026 XXX 140,644 SCHEDULE P - PART 1E - COMMERICAL MULTIPLE PERIL 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 85 9,724 460 1,303 28 2,344 02 1986 11 915 34 364 4 160 03 1987 0 384 20 661 0 107 04 1988 -378 -328 -125 898 0 28 05 1989 70 697 45 1,508 23 370 06 1990 124 9,223 1,309 2,400 45 3,224 07 1991 343 7,353 855 3,124 113 2,731 08 1992 845 11,136 1,371 5,604 256 4,281 09 1993 956 13,604 1,795 5,212 275 4,849 10 1994 2,443 14,623 1,138 8,347 595 5,496 11 1995 10,450 34,701 3,118 14,045 2,123 12,341 12 TOTAL 14,958 102,033 10,022 43,474 3,462 35,936 SCHEDULE P - PART 1E - COMMERICAL MULTIPLE PERIL 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 146 0 1,061 18,814 151 XXX 02 1986 11 0 125 2,628 36 105,302 03 1987 7 0 161 3,288 37 113,571 04 1988 2 332 176 4,005 56 131,794 05 1989 53 358 393 7,349 96 142,879 06 1990 472 457 1,444 21,668 180 164,451 07 1991 353 725 1,434 22,487 281 168,704 08 1992 618 1,399 2,352 37,522 499 178,117 09 1993 677 922 2,455 38,493 777 129,510 10 1994 430 1,934 3,456 54,142 1,607 164,821 11 1995 1,045 3,426 6,873 99,391 3,133 179,089 12 TOTAL 3,815 9,567 19,955 309,785 6,886 XXX SCHEDULE P - PART 1E - COMMERICAL MULTIPLE PERIL 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 444 02 1986 8,423 96,879 43.764 28.117 45.987 0 03 1987 9,935 103,636 46.226 35.537 47.597 0 04 1988 7,347 124,447 53.865 32.506 56.041 0 05 1989 14,153 128,726 62.685 64.845 62.454 0 06 1990 11,153 153,298 67.768 53.861 69.068 0 07 1991 14,710 153,994 71.815 68.225 72.178 0 08 1992 20,274 157,843 84.359 86.199 84.126 0 09 1993 14,737 114,773 65.912 57.862 67.110 0 10 1994 19,560 145,261 73.759 52.466 78.023 0 11 1995 31,941 147,148 68.557 60.759 70.521 0 12 TOTAL XXX XXX XXX XXX XXX 444 SCHEDULE P - PART 1E - COMMERICAL MULTIPLE PERIL 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 13,827 4,543 02 1986 0 .000 1,987 641 03 1987 0 .000 2,366 922 04 1988 0 .000 2,906 1,098 05 1989 0 .000 5,155 2,194 06 1990 0 .000 15,109 6,559 07 1991 0 .000 15,671 6,824 08 1992 0 .000 26,143 11,370 09 1993 0 .000 26,928 11,573 10 1994 0 .000 37,868 16,275 11 1995 0 .000 69,292 30,099 12 TOTAL 0 XXX 217,252 92,098 SCHEDULE P - PART 1F - SECTION 1 - MEDICAL MALPRACTICE - OCCURRENCE ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 2,122 1,416 7 02 1986 8 0 8 0 0 0 03 1987 0 0 0 0 -1 0 04 1988 0 0 0 0 0 0 05 1989 0 0 0 0 0 0 06 1990 0 0 0 0 0 0 07 1991 0 0 0 0 0 0 08 1992 0 0 0 0 1 0 09 1993 0 0 0 0 0 0 10 1994 0 0 0 0 0 0 11 1995 0 0 0 0 0 0 12 TOTAL XXX XXX XXX 2,122 1,417 7 SCHEDULE P - PART 1F - SECTION 1 - MEDICAL MALPRACTICE - OCCURRENCE 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 6 0 -2 705 XXX 2,163 02 1986 0 0 0 0 0 0 03 1987 0 0 0 1 0 0 04 1988 0 0 1 0 0 0 05 1989 0 0 5 5 0 0 06 1990 0 0 0 0 0 0 07 1991 0 0 0 0 0 0 08 1992 0 0 0 -1 0 0 09 1993 0 0 0 0 0 0 10 1994 0 0 -4 -4 0 0 11 1995 0 0 -2 -2 0 0 12 TOTAL 6 0 -1 705 XXX 2,163 SCHEDULE P - PART 1F - SECTION 1 - MEDICAL MALPRACTICE - OCCURRENCE 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 31 1,384 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 0 0 0 0 0 0 04 1988 0 0 0 0 0 0 05 1989 0 0 0 0 0 0 06 1990 0 0 0 0 0 0 07 1991 0 0 0 0 0 0 08 1992 0 0 0 0 0 0 09 1993 0 0 0 0 0 0 10 1994 0 0 0 0 0 0 11 1995 0 0 0 0 0 0 12 TOTAL 31 1,384 0 0 0 0 SCHEDULE P - PART 1F - SECTION 1 - MEDICAL MALPRACTICE - OCCURRENCE 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 0 0 1 3,525 107 XXX 02 1986 0 0 0 0 0 0 03 1987 0 0 0 0 0 0 04 1988 0 0 0 0 0 1 05 1989 0 0 0 0 0 5 06 1990 0 0 0 0 0 0 07 1991 0 0 0 0 0 0 08 1992 0 0 0 0 0 0 09 1993 0 0 0 0 0 0 10 1994 0 0 0 0 0 0 11 1995 0 0 0 0 0 0 12 TOTAL 0 0 1 3,525 107 XXX SCHEDULE P - PART 1F - SECTION 1 - MEDICAL MALPRACTICE - OCCURRENCE 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 0 02 1986 0 0 .000 .000 .000 0 03 1987 -1 1 .000 .000 .000 0 04 1988 0 1 .000 .000 .000 0 05 1989 0 5 .000 .000 .000 0 06 1990 0 0 .000 .000 .000 0 07 1991 0 0 .000 .000 .000 0 08 1992 1 -1 .000 .000 .000 0 09 1993 0 0 .000 .000 .000 0 10 1994 4 -4 .000 .000 .000 0 11 1995 2 -2 .000 .000 .000 0 12 TOTAL XXX XXX XXX XXX XXX 0 SCHEDULE P - PART 1F - SECTION 1 - MEDICAL MALPRACTICE - OCCURRENCE 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 3,524 1 02 1986 0 .000 0 0 03 1987 0 .000 0 0 04 1988 0 .000 0 0 05 1989 0 .000 0 0 06 1990 0 .000 0 0 07 1991 0 .000 0 0 08 1992 0 .000 0 0 09 1993 0 .000 0 0 10 1994 0 .000 0 0 11 1995 0 .000 0 0 12 TOTAL 0 XXX 3,524 1 SCHEDULE P - PART 1F - SECTION 2 - MEDICAL MALPRACTICE - CLAIMS MADE ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 0 0 0 02 1986 0 0 0 0 0 0 03 1987 0 0 0 0 0 0 04 1988 0 0 0 0 0 0 05 1989 0 0 0 0 0 0 06 1990 0 0 0 0 0 0 07 1991 0 0 0 0 0 0 08 1992 0 0 0 0 0 0 09 1993 0 0 0 0 0 0 10 1994 775 177 598 0 20 100 11 1995 1,764 435 1,320 177 21 48 12 TOTAL XXX XXX XXX 177 40 148 SCHEDULE P - PART 1F - SECTION 2 - MEDICAL MALPRACTICE - CLAIMS MADE 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 0 0 0 0 XXX 0 02 1986 0 0 0 0 0 0 03 1987 0 0 0 0 0 0 04 1988 0 0 0 0 0 0 05 1989 0 0 0 0 0 0 06 1990 0 0 0 0 0 0 07 1991 0 0 0 0 0 0 08 1992 0 0 0 0 0 0 09 1993 0 0 0 0 0 0 10 1994 0 0 191 270 6 668 11 1995 0 0 200 405 10 473 12 TOTAL 0 0 391 683 XXX 1,141 SCHEDULE P - PART 1F - SECTION 2 - MEDICAL MALPRACTICE - CLAIMS MADE 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 0 0 0 0 0 0 04 1988 0 0 0 0 0 0 05 1989 0 0 0 0 0 0 06 1990 0 0 0 0 0 0 07 1991 0 0 0 0 0 0 08 1992 0 0 0 0 0 0 09 1993 0 0 0 0 0 0 10 1994 99 0 0 109 5 0 11 1995 0 0 0 146 5 0 12 TOTAL 99 0 0 256 10 0 SCHEDULE P - PART 1F - SECTION 2 - MEDICAL MALPRACTICE - CLAIMS MADE 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 0 0 0 0 0 XXX 02 1986 0 0 0 0 0 0 03 1987 0 0 0 0 0 0 04 1988 0 0 0 0 0 0 05 1989 0 0 0 0 0 0 06 1990 0 0 0 0 0 0 07 1991 0 0 0 0 0 0 08 1992 0 0 0 0 0 0 09 1993 0 0 0 0 0 0 10 1994 0 0 0 673 5 1,067 11 1995 0 0 0 624 7 1,069 12 TOTAL 0 0 0 1,289 13 XXX SCHEDULE P - PART 1F - SECTION 2 - MEDICAL MALPRACTICE - CLAIMS MADE 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 0 02 1986 0 0 .000 .000 .000 0 03 1987 0 0 .000 .000 .000 0 04 1988 0 0 .000 .000 .000 0 05 1989 0 0 .000 .000 .000 0 06 1990 0 0 .000 .000 .000 0 07 1991 0 0 .000 .000 .000 0 08 1992 0 0 .000 .000 .000 0 09 1993 0 0 .000 .000 .000 0 10 1994 123 944 137.677 69.492 157.860 0 11 1995 40 1,029 60.601 9.195 77.955 0 12 TOTAL XXX XXX XXX XXX XXX 0 SCHEDULE P - PART 1F - SECTION 2 - MEDICAL MALPRACTICE - CLAIMS MADE 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 0 0 02 1986 0 .000 0 0 03 1987 0 .000 0 0 04 1988 0 .000 0 0 05 1989 0 .000 0 0 06 1990 0 .000 0 0 07 1991 0 .000 0 0 08 1992 0 .000 0 0 09 1993 0 .000 0 0 10 1994 0 .000 569 104 11 1995 0 .000 473 142 12 TOTAL 0 XXX 1,042 246 SCHEDULE P - PART 1G - SPECIAL LIABILITY ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 213 25 111 02 1986 26,852 9,797 17,054 10,877 2,971 1,192 03 1987 27,165 10,333 16,832 14,638 5,997 1,216 04 1988 26,953 9,997 16,956 13,999 4,045 1,373 05 1989 26,916 9,547 17,370 18,352 6,943 1,553 06 1990 33,146 11,003 22,141 26,491 10,704 2,148 07 1991 40,879 13,519 27,360 25,887 8,812 2,292 08 1992 56,131 17,747 38,383 48,932 24,888 2,897 09 1993 73,633 24,798 48,835 40,504 13,218 3,167 10 1994 78,655 25,099 53,547 30,567 4,798 1,870 11 1995 76,959 21,275 55,682 15,229 3,559 933 12 TOTAL XXX XXX XXX 245,687 85,958 18,750 SCHEDULE P - PART 1G - SPECIAL LIABILITY 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 69 8 2 233 XXX 1,944 02 1986 169 1,477 564 9,484 XXX 142 03 1987 312 1,850 675 10,212 XXX 121 04 1988 385 1,086 907 11,848 XXX 241 05 1989 286 1,798 981 13,656 XXX 368 06 1990 461 1,688 1,010 18,484 XXX 429 07 1991 418 1,418 957 19,899 XXX 1,053 08 1992 749 2,235 1,468 27,668 XXX 1,349 09 1993 641 3,737 2,086 31,898 XXX 4,840 10 1994 199 1,372 1,835 29,274 XXX 10,220 11 1995 140 167 1,221 13,677 XXX 13,557 12 TOTAL 3,836 16,844 11,696 186,341 XXX 34,280 SCHEDULE P - PART 1G - SPECIAL LIABILITY 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 228 1,361 85 23 1 0 02 1986 3 10 0 6 0 0 03 1987 10 36 0 4 0 1 04 1988 9 65 -4 13 0 2 05 1989 10 60 -9 23 1 4 06 1990 33 118 -9 30 1 5 07 1991 205 180 -19 134 11 6 08 1992 89 -250 -64 222 11 5 09 1993 1,322 -1,003 -183 734 217 2 10 1994 1,958 -1,299 17 1,053 140 75 11 1995 2,214 7,009 969 1,940 272 1,536 12 TOTAL 6,082 6,295 785 4,182 662 1,636 SCHEDULE P - PART 1G - SPECIAL LIABILITY 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 0 0 33 3,048 41 XXX 02 1986 0 0 2 158 0 12,827 03 1987 0 0 2 154 0 16,715 04 1988 0 15 4 321 0 16,649 05 1989 0 46 8 462 2 21,402 06 1990 0 72 11 575 5 30,311 07 1991 0 140 37 1,211 30 30,616 08 1992 0 291 45 1,336 30 54,802 09 1993 0 831 122 3,340 152 50,663 10 1994 45 1,470 204 8,100 427 44,776 11 1995 231 3,048 945 21,299 871 42,611 12 TOTAL 276 5,924 1,415 40,018 1,577 XXX SCHEDULE P - PART 1G - SPECIAL LIABILITY 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 176 02 1986 3,177 9,650 47.769 32.428 56.585 0 03 1987 6,342 10,373 61.531 61.376 61.627 0 04 1988 4,473 12,176 61.770 44.743 71.809 0 05 1989 7,277 14,125 79.514 76.223 81.318 0 06 1990 11,252 19,059 91.447 102.263 86.080 0 07 1991 9,507 21,109 74.894 70.323 77.153 0 08 1992 25,790 29,012 97.632 145.320 75.586 0 09 1993 15,425 35,238 68.805 62.203 72.157 0 10 1994 7,402 37,374 56.927 29.491 69.797 0 11 1995 7,627 34,984 55.368 35.850 62.828 0 12 TOTAL XXX XXX XXX XXX XXX 176 SCHEDULE P - PART 1G - SPECIAL LIABILITY 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 2,816 56 02 1986 0 .000 150 8 03 1987 0 .000 145 7 04 1988 0 .000 301 20 05 1989 0 .000 428 34 06 1990 0 .000 531 44 07 1991 0 .000 1,045 166 08 1992 0 .000 1,074 262 09 1993 0 .000 2,706 641 10 1994 0 .000 6,953 1,147 11 1995 0 .000 17,383 3,916 12 TOTAL 0 XXX 33,532 6,301 SCHEDULE P - PART 1H - SECTION 1 - OTHER LIABILITY - OCCURRENCE ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 30,975 12,721 8,905 02 1986 401,372 143,546 257,826 134,491 64,457 27,053 03 1987 333,967 103,353 230,615 98,886 34,139 18,065 04 1988 250,757 77,062 173,695 91,773 27,627 15,312 05 1989 192,051 70,183 121,868 46,311 9,865 8,030 06 1990 196,352 61,867 134,483 43,414 15,878 7,419 07 1991 186,597 49,656 136,941 47,025 11,986 7,894 08 1992 181,673 61,832 119,841 37,860 12,949 6,502 09 1993 219,088 103,829 115,267 35,244 18,308 7,284 10 1994 240,444 115,501 124,942 26,878 12,121 4,816 11 1995 298,327 140,253 158,074 10,435 -474 1,846 12 TOTAL XXX XXX XXX 603,278 219,575 113,138 SCHEDULE P - PART 1H - SECTION 1 - OTHER LIABILITY - OCCURRENCE 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 5,077 351 1,033 23,115 XXX 114,839 02 1986 10,199 644 5,512 92,399 11,584 4,781 03 1987 2,964 576 5,288 85,144 8,650 4,815 04 1988 1,697 1,883 7,019 84,781 6,688 2,218 05 1989 -920 143 6,098 51,503 5,433 1,978 06 1990 -1,801 798 4,214 40,980 4,863 2,814 07 1991 959 210 4,034 45,997 4,607 7,052 08 1992 1,239 109 3,295 33,468 5,944 6,373 09 1993 1,923 34 3,305 25,601 6,936 23,139 10 1994 936 19 3,341 21,978 8,464 29,672 11 1995 673 9 2,973 15,057 3,552 27,479 12 TOTAL 22,939 4,786 46,114 520,020 XXX 225,160 SCHEDULE P - PART 1H - SECTION 1 - OTHER LIABILITY - OCCURRENCE 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 38,711 138,780 67,335 6,101 2,928 20,105 02 1986 2,111 8,698 2,969 900 273 1,931 03 1987 1,940 7,241 3,327 1,147 467 1,726 04 1988 642 12,778 991 643 62 2,761 05 1989 387 30,465 13,273 382 87 7,736 06 1990 181 27,181 11,834 750 20 7,250 07 1991 630 33,138 10,666 2,142 166 6,463 08 1992 780 42,617 18,529 1,638 177 7,837 09 1993 6,019 75,788 31,799 6,122 1,526 9,690 10 1994 8,420 66,051 14,162 6,777 1,470 10,828 11 1995 9,198 108,219 31,363 6,979 2,606 17,256 12 TOTAL 69,027 550,949 206,246 33,582 9,796 93,587 SCHEDULE P - PART 1H - SECTION 1 - OTHER LIABILITY - OCCURRENCE 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 6,704 0 8,655 172,804 3,429 XXX 02 1986 762 0 1,021 11,226 138 185,224 03 1987 857 0 740 9,079 82 138,475 04 1988 269 13 355 16,805 74 133,308 05 1989 4,051 38 816 23,573 88 102,690 06 1990 3,363 22 1,093 23,682 125 95,225 07 1991 2,889 72 1,479 35,917 163 110,337 08 1992 3,923 26 1,470 36,527 315 108,909 09 1993 4,865 8 2,441 72,971 1,497 165,045 10 1994 3,814 9 2,870 88,331 3,310 152,555 11 1995 6,937 17 6,143 115,956 1,608 183,442 12 TOTAL 38,426 204 27,082 606,871 10,858 XXX SCHEDULE P - PART 1H - SECTION 1 - OTHER LIABILITY - OCCURRENCE 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 7,221 02 1986 81,592 103,632 46.148 56.840 40.195 0 03 1987 44,241 94,234 41.464 42.806 40.862 0 04 1988 31,721 101,587 53.162 41.163 58.486 0 05 1989 27,613 75,077 53.470 39.344 61.605 0 06 1990 30,572 64,653 48.497 49.416 48.075 0 07 1991 28,423 81,914 59.131 57.240 59.817 0 08 1992 38,918 69,991 59.948 62.942 58.403 0 09 1993 66,481 98,564 75.333 64.029 85.509 0 10 1994 42,246 110,309 63.447 36.576 88.288 0 11 1995 52,428 131,014 61.490 37.381 82.881 0 12 TOTAL XXX XXX XXX XXX XXX 7,221 SCHEDULE P - PART 1H - SECTION 1 - OTHER LIABILITY - OCCURRENCE 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 140,352 25,223 02 1986 0 .000 8,400 2,825 03 1987 0 .000 6,789 2,290 04 1988 0 .000 13,370 3,436 05 1989 0 .000 18,776 4,796 06 1990 0 .000 17,971 5,701 07 1991 0 .000 28,887 7,030 08 1992 0 .000 29,673 6,845 09 1993 0 .000 61,109 11,862 10 1994 0 .000 73,148 15,192 11 1995 0 .000 95,121 20,828 12 TOTAL 0 XXX 493,596 106,028 SCHEDULE P - PART 1H - SECTION 2 - OTHER LIABILITY - CLAIMS MADE ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 0 0 0 02 1986 28,619 13,637 14,982 2,093 1,006 606 03 1987 78,100 26,911 51,189 13,660 9,729 2,266 04 1988 78,766 22,134 56,631 8,305 2,162 1,876 05 1989 65,766 13,191 52,575 20,531 8,727 3,892 06 1990 73,175 15,049 58,118 50,066 10,259 2,177 07 1991 78,659 10,224 68,435 7,441 139 2,073 08 1992 93,711 11,248 82,463 20,582 3,327 2,069 09 1993 109,153 9,590 99,563 6,423 736 3,026 10 1994 129,444 12,185 117,259 31,432 3,718 2,358 11 1995 134,567 24,153 110,413 2,230 6,834 833 12 TOTAL XXX XXX XXX 162,763 46,637 21,173 SCHEDULE P - PART 1H - SECTION 2 - OTHER LIABILITY - CLAIMS MADE 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 0 0 0 0 XXX 0 02 1986 246 1 0 1,447 104 0 03 1987 769 20 668 6,096 446 11 04 1988 489 3 388 7,927 282 0 05 1989 1,726 4 1,021 14,991 263 1,210 06 1990 436 4 2,255 43,794 347 4,039 07 1991 202 0 1,301 10,474 476 5,076 08 1992 472 0 1,979 20,822 440 3,769 09 1993 105 72 1,369 9,986 571 16,525 10 1994 17 0 1,450 31,512 680 27,699 11 1995 35 0 608 -3,198 833 27,017 12 TOTAL 4,504 105 11,047 143,841 XXX 85,346 SCHEDULE P - PART 1H - SECTION 2 - OTHER LIABILITY - CLAIMS MADE 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 1 0 0 13 1 0 04 1988 28 0 0 0 7 0 05 1989 404 0 0 298 100 0 06 1990 480 37 5 776 119 4 07 1991 139 2,451 47 1,018 34 36 08 1992 15 4,841 127 701 3 90 09 1993 1,793 36,186 365 3,960 433 154 10 1994 144 19,133 570 6,696 4 301 11 1995 2,807 62,383 1,469 6,616 198 3,645 12 TOTAL 5,819 125,030 2,582 20,069 907 4,231 SCHEDULE P - PART 1H - SECTION 2 - OTHER LIABILITY - CLAIMS MADE 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 0 0 0 0 0 XXX 02 1986 0 0 0 0 0 2,699 03 1987 0 0 2 24 2 16,568 04 1988 0 0 -1 -36 1 10,586 05 1989 0 0 49 1,054 7 27,044 06 1990 1 0 189 4,433 36 59,726 07 1991 14 0 255 8,602 58 19,695 08 1992 35 0 141 9,360 86 34,218 09 1993 61 0 792 54,964 146 68,553 10 1994 92 0 1,286 54,306 273 90,877 11 1995 376 0 1,564 96,376 799 105,424 12 TOTAL 579 0 4,286 229,084 1,425 XXX SCHEDULE P - PART 1H - SECTION 2 - OTHER LIABILITY - CLAIMS MADE 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 0 02 1986 1,252 1,447 9.431 9.181 9.658 0 03 1987 10,448 6,120 21.214 38.824 11.956 0 04 1988 2,695 7,891 13.440 12.176 13.934 0 05 1989 11,007 16,037 41.122 83.443 30.503 0 06 1990 11,498 48,228 81.621 76.404 82.983 0 07 1991 619 19,076 25.038 6.054 27.875 0 08 1992 4,036 30,182 36.514 35.882 36.601 0 09 1993 3,604 64,949 62.805 37.581 65.234 0 10 1994 5,051 85,826 70.206 41.453 73.194 0 11 1995 12,246 93,178 78.343 50.702 84.390 0 12 TOTAL XXX XXX XXX XXX XXX 0 SCHEDULE P - PART 1H - SECTION 2 - OTHER LIABILITY - CLAIMS MADE 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 0 0 02 1986 0 .000 0 0 03 1987 0 .000 10 14 04 1988 0 .000 -28 -8 05 1989 0 .000 806 247 06 1990 0 .000 3,592 850 07 1991 0 .000 7,342 1,260 08 1992 0 .000 8,467 894 09 1993 0 .000 50,562 4,403 10 1994 0 .000 46,118 8,188 11 1995 0 .000 85,124 11,251 12 TOTAL 0 XXX 201,993 27,099 SCHEDULE P - PART 1I - SPECIAL PROPERTY ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 10,850 6,048 1,384 02 1994 309,665 106,955 202,711 218,030 87,484 6,587 03 1995 386,507 140,432 246,075 171,304 70,828 4,085 04 TOTAL XXX XXX XXX 400,176 164,367 12,055 SCHEDULE P - PART 1I - SPECIAL PROPERTY 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 347 655 66 5,897 XXX 7,117 02 1994 1,644 909 4,926 140,407 XXX 55,559 03 1995 1,262 573 3,793 107,084 XXX 78,068 04 TOTAL 3,260 2,137 8,777 253,389 XXX 140,744 SCHEDULE P - PART 1I - SPECIAL PROPERTY 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 1,814 6,933 1,999 613 179 605 02 1994 28,763 1,821 297 3,352 1,382 242 03 1995 15,413 22,732 1,400 3,266 945 1,615 04 TOTAL 45,990 31,478 3,696 7,225 2,506 2,453 SCHEDULE P - PART 1I - SPECIAL PROPERTY 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 242 280 144 11,171 1,911 XXX 02 1994 52 350 614 31,086 157 291,728 03 1995 161 781 1,301 89,061 1,505 286,583 04 TOTAL 455 1,410 2,058 131,319 3,583 XXX SCHEDULE P - PART 1I - SPECIAL PROPERTY 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 57 02 1994 120,237 171,491 94.208 112.418 84.599 0 03 1995 90,438 196,145 74.147 64.400 79.709 0 04 TOTAL XXX XXX XXX XXX XXX 57 SCHEDULE P - PART 1I - SPECIAL PROPERTY 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 10,181 932 02 1994 0 .000 28,310 2,776 03 1995 0 .000 83,996 5,074 04 TOTAL 0 XXX 122,487 8,782 SCHEDULE P - PART 1J - AUTO PHYSICAL DAMAGE ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX -2,401 -112 1,024 02 1994 553,965 103,301 450,665 359,922 69,445 12,557 03 1995 623,985 125,309 498,676 456,872 112,324 10,348 04 TOTAL XXX XXX XXX 814,383 181,663 23,930 SCHEDULE P - PART 1J - AUTO PHYSICAL DAMAGE 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 50 5,326 -26 -1,342 XXX 2,307 02 1994 3,308 29,612 20,868 320,593 321,733 -1,384 03 1995 2,674 17,141 24,286 376,500 379,830 30,546 04 TOTAL 6,041 52,082 45,125 695,749 XXX 31,469 SCHEDULE P - PART 1J - AUTO PHYSICAL DAMAGE 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 6 2,277 -5 215 2 118 02 1994 157 -422 -55 305 49 51 03 1995 7,171 22,621 5,085 3,670 1,248 1,717 04 TOTAL 7,334 24,475 5,025 4,192 1,298 1,885 SCHEDULE P - PART 1J - AUTO PHYSICAL DAMAGE 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 4 1,851 236 5,146 453 XXX 02 1994 28 2,962 193 -1,434 5,795 392,269 03 1995 27 18,332 2,692 47,713 36,258 553,103 04 TOTAL 59 23,135 3,121 51,434 42,516 XXX SCHEDULE P - PART 1J - AUTO PHYSICAL DAMAGE 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 0 02 1994 73,110 319,159 70.811 70.774 70.820 0 03 1995 128,881 424,222 88.640 102.851 85.070 0 04 TOTAL XXX XXX XXX XXX XXX 0 SCHEDULE P - PART 1J - AUTO PHYSICAL DAMAGE 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 4,583 564 02 1994 0 .000 -1,908 474 03 1995 0 .000 40,910 6,804 04 TOTAL 0 XXX 43,585 7,842 SCHEDULE P - PART 1K - FIDELITY, SURETY ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX -888 -224 196 02 1994 40,231 8,177 32,055 4,088 1,462 677 03 1995 41,693 8,761 32,932 3,418 935 161 04 TOTAL XXX XXX XXX 6,619 2,173 1,033 SCHEDULE P - PART 1K - FIDELITY, SURETY 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 82 936 -189 -739 XXX -3,886 02 1994 245 1 1,022 4,072 XXX 1,277 03 1995 32 21 1,105 3,717 XXX 11,637 04 TOTAL 360 957 1,939 7,049 XXX 9,020 SCHEDULE P - PART 1K - FIDELITY, SURETY 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR -1,629 -489 -79 -688 -366 0 02 1994 1,800 -329 -53 180 377 0 03 1995 2,915 9,524 1,521 1,682 413 1,406 04 TOTAL 3,087 8,698 1,381 1,174 423 1,406 SCHEDULE P - PART 1K - FIDELITY, SURETY 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 0 523 -181 -3,169 418 XXX 02 1994 0 278 -86 -1,081 149 7,069 03 1995 223 328 1,735 20,904 85 31,159 04 TOTAL 223 1,130 1,461 16,645 653 XXX SCHEDULE P - PART 1K - FIDELITY, SURETY 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 0 02 1994 4,079 2,990 17.571 49.884 9.328 0 03 1995 6,532 24,627 74.734 74.558 74.781 0 04 TOTAL XXX XXX XXX XXX XXX 0 SCHEDULE P - PART 1K - FIDELITY, SURETY 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX -2,676 -502 02 1994 0 .000 -799 -283 03 1995 0 .000 16,724 4,179 04 TOTAL 0 XXX 13,249 3,394 SCHEDULE P - PART 1L - OTHER (INCLUDING CREDIT, ACCIDENT AND HEALTH) ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 323 130 0 02 1994 12,044 4,995 7,049 1,680 793 0 03 1995 15,933 6,986 8,947 43 146 0 04 TOTAL XXX XXX XXX 2,046 1,069 0 SCHEDULE P - PART 1L - OTHER (INCLUDING CREDIT, ACCIDENT AND HEALTH) 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 0 0 12 205 XXX 445 02 1994 0 0 108 996 XXX 372 03 1995 0 0 45 -57 XXX 44 04 TOTAL 0 0 166 1,144 XXX 871 SCHEDULE P - PART 1L - OTHER (INCLUDING CREDIT, ACCIDENT AND HEALTH) 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 169 1,003 421 0 0 0 02 1994 164 2,430 987 0 0 0 03 1995 20 7,151 1,790 0 0 0 04 TOTAL 353 10,592 3,197 0 0 0 SCHEDULE P - PART 1L - OTHER (INCLUDING CREDIT, ACCIDENT AND HEALTH) 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 0 0 0 859 0 XXX 02 1994 0 0 0 1,659 0 4,603 03 1995 0 0 0 5,386 0 7,286 04 TOTAL 0 0 0 7,904 0 XXX SCHEDULE P - PART 1L - OTHER (INCLUDING CREDIT, ACCIDENT AND HEALTH) 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 0 02 1994 1,947 2,656 38.218 38.979 37.679 0 03 1995 1,957 5,329 45.729 28.013 59.562 0 04 TOTAL XXX XXX XXX XXX XXX 0 SCHEDULE P - PART 1L - OTHER (INCLUDING CREDIT, ACCIDENT AND HEALTH) 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 859 0 02 1994 0 .000 1,659 0 03 1995 0 .000 5,386 0 04 TOTAL 0 XXX 7,904 0 SCHEDULE P - PART 1M - INTERNATIONAL ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 665 130 0 02 1986 -244 -10 -234 0 0 0 03 1987 169 3 166 0 0 0 04 1988 175 9 166 0 0 0 05 1989 -13 -1 -12 0 0 0 06 1990 -14 -1 -13 0 0 0 07 1991 2 0 2 0 0 0 08 1992 16 1 15 0 0 0 09 1993 3 0 3 0 0 0 10 1994 0 0 0 0 0 0 11 1995 0 0 0 0 0 0 12 TOTAL XXX XXX XXX 665 130 0 SCHEDULE P - PART 1M - INTERNATIONAL 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 0 0 38 573 XXX 2,978 02 1986 0 0 0 0 XXX 0 03 1987 0 0 0 0 XXX 0 04 1988 0 0 0 0 XXX 0 05 1989 0 0 0 0 XXX 0 06 1990 0 0 0 0 XXX 0 07 1991 0 0 0 0 XXX 0 08 1992 0 0 0 0 XXX 0 09 1993 0 0 0 0 XXX 0 10 1994 0 0 0 0 XXX 0 11 1995 0 0 0 0 XXX 0 12 TOTAL 0 0 38 573 XXX 2,978 SCHEDULE P - PART 1M - INTERNATIONAL 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 676 1,374 59 0 0 0 02 1986 0 0 0 0 0 0 03 1987 0 0 0 0 0 0 04 1988 0 0 0 0 0 0 05 1989 0 0 0 0 0 0 06 1990 0 0 0 0 0 0 07 1991 0 0 0 0 0 0 08 1992 0 0 0 0 0 0 09 1993 0 0 0 0 0 0 10 1994 0 0 0 0 0 0 11 1995 0 0 0 0 0 0 12 TOTAL 676 1,374 59 0 0 0 SCHEDULE P - PART 1M - INTERNATIONAL 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 0 0 317 3,934 312 XXX 02 1986 0 0 0 0 0 0 03 1987 0 0 0 0 0 0 04 1988 0 0 0 0 0 0 05 1989 0 0 0 0 0 0 06 1990 0 0 0 0 0 0 07 1991 0 0 0 0 0 0 08 1992 0 0 0 0 0 0 09 1993 0 0 0 0 0 0 10 1994 0 0 0 0 0 0 11 1995 0 0 0 0 0 0 12 TOTAL 0 0 317 3,934 312 XXX SCHEDULE P - PART 1M - INTERNATIONAL 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 0 02 1986 0 0 .000 .000 .000 0 03 1987 0 0 .000 .000 .000 0 04 1988 0 0 .000 .000 .000 0 05 1989 0 0 .000 .000 .000 0 06 1990 0 0 .000 .000 .000 0 07 1991 0 0 .000 .000 .000 0 08 1992 0 0 .000 .000 .000 0 09 1993 0 0 .000 .000 .000 0 10 1994 0 0 .000 .000 .000 0 11 1995 0 0 .000 .000 .000 0 12 TOTAL XXX XXX XXX XXX XXX 0 SCHEDULE P - PART 1M - INTERNATIONAL 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 3,617 317 02 1986 0 .000 0 0 03 1987 0 .000 0 0 04 1988 0 .000 0 0 05 1989 0 .000 0 0 06 1990 0 .000 0 0 07 1991 0 .000 0 0 08 1992 0 .000 0 0 09 1993 0 .000 0 0 10 1994 0 .000 0 0 11 1995 0 .000 0 0 12 TOTAL 0 XXX 3,617 317 SCHEDULE P - PART 1N - REINSURANCE A ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 1988 0 0 0 0 0 0 02 1989 0 0 0 0 0 0 03 1990 0 0 0 0 0 0 04 1991 0 0 0 0 0 0 05 1992 0 0 0 0 0 0 06 1993 62 2 60 0 0 0 07 1994 215 11 204 0 0 0 08 1995 213 19 194 0 0 0 09 TOTAL XXX XXX XXX 0 0 0 SCHEDULE P - PART 1N - REINSURANCE A 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 1988 0 0 0 0 XXX 0 02 1989 0 0 0 0 XXX 0 03 1990 0 0 0 0 XXX 0 04 1991 0 0 0 0 XXX 0 05 1992 0 0 0 0 XXX 0 06 1993 0 0 0 0 XXX 0 07 1994 0 0 0 0 XXX 0 08 1995 0 0 0 0 XXX 0 09 TOTAL 0 0 0 0 XXX 0 SCHEDULE P - PART 1N - REINSURANCE A 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 1988 0 0 0 0 0 0 02 1989 0 0 0 0 0 0 03 1990 0 0 0 0 0 0 04 1991 0 0 0 0 0 0 05 1992 0 0 0 0 0 0 06 1993 0 0 0 0 0 0 07 1994 0 0 0 0 0 0 08 1995 0 0 0 0 0 0 09 TOTAL 0 0 0 0 0 0 SCHEDULE P - PART 1N - REINSURANCE A 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 1988 0 0 0 0 XXX 0 02 1989 0 0 0 0 XXX 0 03 1990 0 0 0 0 XXX 0 04 1991 0 0 0 0 XXX 0 05 1992 0 0 0 0 XXX 0 06 1993 0 0 0 0 XXX 0 07 1994 0 0 0 0 XXX 0 08 1995 0 0 0 0 XXX 0 09 TOTAL 0 0 0 0 XXX XXX SCHEDULE P - PART 1N - REINSURANCE A 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 1988 0 0 .000 .000 .000 0 02 1989 0 0 .000 .000 .000 0 03 1990 0 0 .000 .000 .000 0 04 1991 0 0 .000 .000 .000 0 05 1992 0 0 .000 .000 .000 0 06 1993 0 0 .000 .000 .000 0 07 1994 0 0 .000 .000 .000 0 08 1995 0 0 .000 .000 .000 0 09 TOTAL XXX XXX XXX XXX XXX 0 SCHEDULE P - PART 1N - REINSURANCE A 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 1988 0 .000 0 0 02 1989 0 .000 0 0 03 1990 0 .000 0 0 04 1991 0 .000 0 0 05 1992 0 .000 0 0 06 1993 0 .000 0 0 07 1994 0 .000 0 0 08 1995 0 .000 0 0 09 TOTAL 0 XXX 0 0 SCHEDULE P - PART 1O - REINSURANCE B ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 1988 2,011 0 2,011 0 0 0 02 1989 612 1,823 -1,211 0 0 0 03 1990 231 7 224 0 0 0 04 1991 -326 -8 -318 0 0 0 05 1992 134 0 134 0 0 0 06 1993 516 0 516 0 0 0 07 1994 0 0 0 0 0 0 08 1995 86 0 86 0 0 0 09 TOTAL XXX XXX XXX 0 0 0 SCHEDULE P - PART 1O - REINSURANCE B 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 1988 0 0 0 0 XXX 0 02 1989 0 0 0 0 XXX 0 03 1990 0 0 0 0 XXX 0 04 1991 0 0 0 0 XXX 0 05 1992 0 0 0 0 XXX 0 06 1993 0 0 0 0 XXX 0 07 1994 0 0 0 0 XXX 0 08 1995 0 0 0 0 XXX 0 09 TOTAL 0 0 0 0 XXX 0 SCHEDULE P - PART 1O - REINSURANCE B 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 1988 0 0 0 0 0 0 02 1989 0 0 0 0 0 0 03 1990 0 0 0 0 0 0 04 1991 0 0 0 0 0 0 05 1992 0 0 0 0 0 0 06 1993 0 0 0 0 0 0 07 1994 0 0 0 0 0 0 08 1995 0 0 0 0 0 0 09 TOTAL 0 0 0 0 0 0 SCHEDULE P - PART 1O - REINSURANCE B 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 1988 0 0 0 0 XXX 0 02 1989 0 0 0 0 XXX 0 03 1990 0 0 0 0 XXX 0 04 1991 0 0 0 0 XXX 0 05 1992 0 0 0 0 XXX 0 06 1993 0 0 0 0 XXX 0 07 1994 0 0 0 0 XXX 0 08 1995 0 0 0 0 XXX 0 09 TOTAL 0 0 0 0 XXX XXX SCHEDULE P - PART 1O - REINSURANCE B 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 1988 0 0 .000 .000 .000 0 02 1989 0 0 .000 .000 .000 0 03 1990 0 0 .000 .000 .000 0 04 1991 0 0 .000 .000 .000 0 05 1992 0 0 .000 .000 .000 0 06 1993 0 0 .000 .000 .000 0 07 1994 0 0 .000 .000 .000 0 08 1995 0 0 .000 .000 .000 0 09 TOTAL XXX XXX XXX XXX XXX 0 SCHEDULE P - PART 1O - REINSURANCE B 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 1988 0 .000 0 0 02 1989 0 .000 0 0 03 1990 0 .000 0 0 04 1991 0 .000 0 0 05 1992 0 .000 0 0 06 1993 0 .000 0 0 07 1994 0 .000 0 0 08 1995 0 .000 0 0 09 TOTAL 0 XXX 0 0 SCHEDULE P - PART 1P - REINSURANCE C ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 1988 0 0 0 0 0 0 02 1989 0 0 0 0 0 0 03 1990 0 0 0 0 0 0 04 1991 0 0 0 0 0 0 05 1992 0 0 0 0 0 0 06 1993 0 0 0 0 0 0 07 1994 0 0 0 0 0 0 08 1995 0 0 0 0 0 0 09 TOTAL XXX XXX XXX 0 0 0 SCHEDULE P - PART 1P - REINSURANCE C 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 1988 0 0 0 0 XXX 0 02 1989 0 0 0 0 XXX 0 03 1990 0 0 0 0 XXX 0 04 1991 0 0 0 0 XXX 0 05 1992 0 0 0 0 XXX 0 06 1993 0 0 0 0 XXX 0 07 1994 0 0 0 0 XXX 0 08 1995 0 0 0 0 XXX 0 09 TOTAL 0 0 0 0 XXX 0 SCHEDULE P - PART 1P - REINSURANCE C 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 1988 0 0 0 0 0 0 02 1989 0 0 0 0 0 0 03 1990 0 0 0 0 0 0 04 1991 0 0 0 0 0 0 05 1992 0 0 0 0 0 0 06 1993 0 0 0 0 0 0 07 1994 0 0 0 0 0 0 08 1995 0 0 0 0 0 0 09 TOTAL 0 0 0 0 0 0 SCHEDULE P - PART 1P - REINSURANCE C 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 1988 0 0 0 0 XXX 0 02 1989 0 0 0 0 XXX 0 03 1990 0 0 0 0 XXX 0 04 1991 0 0 0 0 XXX 0 05 1992 0 0 0 0 XXX 0 06 1993 0 0 0 0 XXX 0 07 1994 0 0 0 0 XXX 0 08 1995 0 0 0 0 XXX 0 09 TOTAL 0 0 0 0 XXX XXX SCHEDULE P - PART 1P - REINSURANCE C 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 1988 0 0 .000 .000 .000 0 02 1989 0 0 .000 .000 .000 0 03 1990 0 0 .000 .000 .000 0 04 1991 0 0 .000 .000 .000 0 05 1992 0 0 .000 .000 .000 0 06 1993 0 0 .000 .000 .000 0 07 1994 0 0 .000 .000 .000 0 08 1995 0 0 .000 .000 .000 0 09 TOTAL XXX XXX XXX XXX XXX 0 SCHEDULE P - PART 1P - REINSURANCE C 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 1988 0 .000 0 0 02 1989 0 .000 0 0 03 1990 0 .000 0 0 04 1991 0 .000 0 0 05 1992 0 .000 0 0 06 1993 0 .000 0 0 07 1994 0 .000 0 0 08 1995 0 .000 0 0 09 TOTAL 0 XXX 0 0 SCHEDULE P - PART 1Q - REINSURANCE D ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 464 0 108 02 1986 2,194 0 2,194 2,125 224 13 03 1987 7,261 3,615 3,646 34,660 28,196 17,680 04 1988 XXX XXX XXX 37,249 28,420 17,801 SCHEDULE P - PART 1Q - REINSURANCE D 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 0 0 4 576 XXX 2,619 02 1986 0 0 4 1,918 XXX 204 03 1987 15,082 2,447 359 9,420 XXX 19,264 04 1988 15,082 2,447 367 11,914 XXX 22,087 SCHEDULE P - PART 1Q - REINSURANCE D 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 0 1,887 0 111 0 17 02 1986 0 178 0 0 0 0 03 1987 17,878 11,950 11,950 950 939 0 04 1988 17,878 14,015 11,950 1,061 939 17 SCHEDULE P - PART 1Q - REINSURANCE D 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 0 0 87 4,721 XXX XXX 02 1986 0 0 11 393 XXX 316 03 1987 0 0 0 1,397 XXX 84,863 04 1988 0 0 98 6,511 XXX 0 SCHEDULE P - PART 1Q - REINSURANCE D 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 0 02 1986 0 316 14.403 .000 14.403 0 03 1987 74,039 10,824 1,168.751 2,048.105 296.873 0 04 1988 XXX XXX XXX XXX XXX 0 SCHEDULE P - PART 1Q - REINSURANCE D 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 4,506 215 02 1986 0 .000 382 11 03 1987 0 .000 1,386 11 04 1988 0 XXX 6,274 237 SCHEDULE P - PART 1R - SECTION 1 - PRODUCTS LIABILITY - OCCURRENCE ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 6,978 7,598 2,911 02 1986 114,896 52,778 62,118 37,365 22,081 7,407 03 1987 109,235 38,440 70,795 14,299 7,916 3,406 04 1988 64,218 27,037 37,181 15,875 12,212 5,769 05 1989 40,187 19,668 20,519 8,849 5,300 1,824 06 1990 33,551 16,741 16,810 7,019 5,096 1,426 07 1991 24,228 14,297 9,931 2,317 1,596 1,939 08 1992 11,503 2,383 9,120 2,027 977 1,428 09 1993 19,070 8,228 10,842 743 979 555 10 1994 13,550 5,013 8,537 -146 -190 352 11 1995 16,280 5,880 10,400 259 131 155 12 TOTAL XXX XXX XXX 95,585 63,696 27,172 SCHEDULE P - PART 1R - SECTION 1 - PRODUCTS LIABILITY - OCCURRENCE 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 1,948 13 227 570 XXX 33,200 02 1986 2,611 107 1,810 21,890 1,104 3,823 03 1987 509 145 180 9,460 710 6,025 04 1988 1,716 125 -2,024 5,692 390 1,214 05 1989 1,023 237 555 4,905 271 989 06 1990 943 755 922 3,328 364 2,070 07 1991 1,119 1,775 986 2,527 361 236 08 1992 368 1,941 600 2,710 275 1,049 09 1993 266 1,717 255 308 303 2,823 10 1994 74 1,287 427 749 252 1,258 11 1995 39 977 359 603 217 1,911 12 TOTAL 10,616 9,079 4,297 52,742 XXX 54,597 SCHEDULE P - PART 1R - SECTION 1 - PRODUCTS LIABILITY - OCCURRENCE 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 24,571 78,014 59,371 5,034 2,364 11,580 02 1986 2,710 3,321 956 560 235 573 03 1987 794 1,522 694 402 150 407 04 1988 827 1,496 567 105 3 387 05 1989 745 6,360 1,541 62 22 1,962 06 1990 2,007 6,969 1,309 295 217 1,507 07 1991 93 7,444 1,872 84 24 1,205 08 1992 314 5,933 2,659 334 28 1,339 09 1993 2,385 5,708 2,742 895 593 1,349 10 1994 530 5,545 2,527 369 144 1,413 11 1995 952 11,399 2,785 675 322 3,017 12 TOTAL 35,929 133,713 77,014 8,814 4,104 24,733 SCHEDULE P - PART 1R - SECTION 1 - PRODUCTS LIABILITY - OCCURRENCE 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 5,358 0 2,833 38,989 909 XXX 02 1986 158 0 422 4,639 66 55,351 03 1987 196 0 125 6,655 53 26,352 04 1988 168 2 283 1,920 38 22,044 05 1989 503 3 205 6,760 32 20,969 06 1990 367 76 419 7,360 40 20,669 07 1991 534 73 114 6,560 21 14,645 08 1992 774 258 224 5,105 43 13,294 09 1993 724 326 239 4,561 33 12,985 10 1994 653 322 313 5,045 36 9,757 11 1995 691 389 1,439 13,691 47 19,557 12 TOTAL 10,150 1,457 6,626 101,293 1,328 XXX SCHEDULE P - PART 1R - SECTION 1 - PRODUCTS LIABILITY - OCCURRENCE 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 43 02 1986 28,811 26,539 48.174 54.589 42.723 0 03 1987 10,254 16,100 24.124 26.675 22.741 0 04 1988 14,432 7,612 34.326 53.378 20.472 0 05 1989 9,302 11,667 52.178 47.295 56.859 0 06 1990 9,982 10,688 61.604 59.626 63.581 0 07 1991 5,566 9,079 60.446 38.931 91.420 0 08 1992 5,487 7,806 115.569 230.255 85.592 0 09 1993 8,116 4,871 68.091 98.638 44.927 0 10 1994 3,964 5,793 72.007 79.074 67.857 0 11 1995 5,263 14,293 120.128 89.506 137.432 0 12 TOTAL XXX XXX XXX XXX XXX 43 SCHEDULE P - PART 1R - SECTION 1 - PRODUCTS LIABILITY - OCCURRENCE 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 27,221 11,725 02 1986 0 .000 3,477 1,162 03 1987 0 .000 6,059 588 04 1988 0 .000 1,316 604 05 1989 0 .000 5,064 1,695 06 1990 0 .000 5,724 1,637 07 1991 0 .000 5,724 845 08 1992 0 .000 4,010 1,095 09 1993 0 .000 3,404 1,166 10 1994 0 .000 3,747 1,298 11 1995 0 .000 9,581 4,111 12 TOTAL 0 XXX 75,324 25,926 SCHEDULE P - PART 1R - SECTION 2 - PRODUCTS LIABILITY - CLAIMS MADE ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 0 0 0 02 1986 6,129 2,629 3,500 6 1 4 03 1987 14,443 3,545 10,898 1,981 263 1,657 04 1988 13,133 3,126 9,999 1,183 119 663 05 1989 10,082 2,163 7,927 1,274 377 592 06 1990 7,977 1,480 6,497 3,625 1,479 718 07 1991 9,569 2,044 7,525 1,107 823 268 08 1992 7,471 3,221 4,250 911 356 739 09 1993 3,863 2,707 1,155 815 7 246 10 1994 4,823 2,970 1,861 184 162 446 11 1995 3,054 2,033 1,021 38 120 13 12 TOTAL XXX XXX XXX 11,141 3,715 5,346 SCHEDULE P - PART 1R - SECTION 2 - PRODUCTS LIABILITY - CLAIMS MADE 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 0 0 0 0 XXX 0 02 1986 1 0 0 8 12 0 03 1987 62 0 269 3,588 177 0 04 1988 85 0 95 1,728 125 14 05 1989 19 0 166 1,634 180 0 06 1990 238 0 329 2,956 89 50 07 1991 156 0 111 515 340 362 08 1992 351 0 27 970 83 1,114 09 1993 7 0 149 1,197 56 326 10 1994 207 0 230 490 85 687 11 1995 10 0 56 -23 41 106 12 TOTAL 1,147 0 1,439 13,071 XXX 2,668 SCHEDULE P - PART 1R - SECTION 2 - PRODUCTS LIABILITY - CLAIMS MADE 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 0 0 0 0 0 0 04 1988 9 0 0 6 4 0 05 1989 0 3 0 0 0 0 06 1990 50 11 4 4 4 2 07 1991 4 73 13 21 1 5 08 1992 628 58 22 36 7 9 09 1993 30 133 63 42 7 21 10 1994 415 204 154 173 110 26 11 1995 42 660 197 59 16 40 12 TOTAL 1,187 1,150 453 341 150 103 SCHEDULE P - PART 1R - SECTION 2 - PRODUCTS LIABILITY - CLAIMS MADE 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 0 0 0 0 0 XXX 02 1986 0 0 0 0 0 10 03 1987 0 0 0 0 2 3,914 04 1988 0 0 0 8 1 1,962 05 1989 0 0 0 3 0 2,035 06 1990 1 0 0 8 0 4,739 07 1991 3 0 4 442 10 1,957 08 1992 5 0 3 557 7 2,905 09 1993 12 0 6 417 9 1,755 10 1994 15 0 8 397 29 1,989 11 1995 110 0 27 527 22 1,013 12 TOTAL 146 0 49 2,376 87 XXX SCHEDULE P - PART 1R - SECTION 2 - PRODUCTS LIABILITY - CLAIMS MADE 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 0 02 1986 2 8 .163 .076 .229 0 03 1987 326 3,588 27.100 9.196 32.923 0 04 1988 217 1,745 14.939 6.942 17.452 0 05 1989 397 1,638 20.184 18.354 20.664 0 06 1990 1,774 2,965 59.408 119.865 45.636 0 07 1991 1,000 957 20.451 48.924 12.718 0 08 1992 1,370 1,535 38.884 42.533 36.118 0 09 1993 133 1,622 45.431 4.913 140.433 0 10 1994 1,101 888 41.240 37.071 47.716 0 11 1995 501 512 33.170 24.643 50.147 0 12 TOTAL XXX XXX XXX XXX XXX 0 SCHEDULE P - PART 1R - SECTION 2 - PRODUCTS LIABILITY - CLAIMS MADE 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 0 0 02 1986 0 .000 0 0 03 1987 0 .000 0 0 04 1988 0 .000 6 3 05 1989 0 .000 3 0 06 1990 0 .000 7 1 07 1991 0 .000 417 25 08 1992 0 .000 522 36 09 1993 0 .000 367 50 10 1994 0 .000 314 83 11 1995 0 .000 526 0 12 TOTAL 0 XXX 2,162 198 SCHEDULE P - PART 1S - FINANCIAL GUARANTY/MORTGAGE GUARANTY ($000 OMITTED) 1 PREMIUMS EARNED LOSS AND LOSS EXPENSE PAYMENTS YEARS IN 2 3 4 ALLOCATED LOSS WHICH PRE- LOSS PAYMENTS EXP PAYMENTS MIUMS WERE DIRECT NET 5 6 7 EARNED AND AND CEDED (2 - 3) DIRECT DIRECT LOSSES ASSUMED AND CEDED AND WERE INC ASSUMED ASSUMED 01 PRIOR XXX XXX XXX 0 0 0 02 1994 0 0 0 0 0 0 03 1995 0 0 0 0 0 0 04 TOTAL XXX XXX XXX 0 0 0 SCHEDULE P - PART 1S - FINANCIAL GUARANTY/MORTGAGE GUARANTY 1 LOSS AND LOSS EXPENSE PAYMENTS LOSSES UNPAID YEARS IN ALLOC LOSS 9 10 11 12 CASE BASIS WHICH PRE- EXPENSE NUMBER OF MIUMS WERE PAYMENTS SALVAGE UNALLOCATED TOTAL CLAIMS 13 EARNED AND 8 AND LOSS NET PAID REPORTED - DIRECT LOSSES CEDED SUBROGATION EXPENSE (5 - 6 + 7 DIRECT AND AND WERE INC RECEIVED PAYMENTS - 8 + 10) ASSUMED ASSUMED 01 PRIOR 0 0 0 0 XXX 0 02 1994 0 0 0 0 XXX 0 03 1995 0 0 0 0 XXX 0 04 TOTAL 0 0 0 0 XXX 0 SCHEDULE P - PART 1S - FINANCIAL GUARANTY/MORTGAGE GUARANTY 1 LOSSES UNPAID ALLOCATED LOSS EXPENSES UNPAID YEARS IN CASE BASIS BULK + IBNR CASE BASIS BULK + IBNR WHICH PRE- MIUMS WERE 14 15 16 17 18 19 EARNED AND DIRECT DIRECT DIRECT LOSSES CEDED AND CEDED AND CEDED AND WERE INC ASSUMED ASSUMED ASSUMED 01 PRIOR 0 0 0 0 0 0 02 1994 0 0 0 0 0 0 03 1995 0 0 0 0 0 0 04 TOTAL 0 0 0 0 0 0 SCHEDULE P - PART 1S - FINANCIAL GUARANTY/MORTGAGE GUARANTY 1 21 22 23 24 TOTAL LOSSES YEARS IN BULK + IBNR & LOSS EXP WHICH PRE- NUMBER OF INCURRED MIUMS WERE 20 SALVAGE UNALLOCATED TOTAL CLAIMS 25 EARNED AND AND LOSS NET LOSSES OUTSTANDING DIRECT LOSSES CEDED SUBROGATION EXPENSES & EXPENSES DIRECT AND AND WERE INC ANTICIPATED UNPAID UNPAID ASSUMED ASSUMED 01 PRIOR 0 0 0 0 0 XXX 02 1994 0 0 0 0 0 0 03 1995 0 0 0 0 0 0 04 TOTAL 0 0 0 0 0 XXX SCHEDULE P - PART 1S - FINANCIAL GUARANTY/MORTGAGE GUARANTY 1 TOTAL LOSSES AND LOSS LOSS AND LOSS EXPENSE PERCENTAGE DISCOUNT FOR YEARS IN EXPENSES INCURRED (INCURRED/PREMIUMS EARNED) TIME VALUE WHICH PRE- OF MONEY MIUMS WERE 26 27 28 29 30 31 EARNED AND DIRECT LOSSES CEDED NET* AND CEDED NET LOSS WERE INC ASSUMED 01 PRIOR XXX XXX XXX XXX XXX 0 02 1994 0 0 .000 .000 .000 0 03 1995 0 0 .000 .000 .000 0 04 TOTAL XXX XXX XXX XXX XXX 0 SCHEDULE P - PART 1S - FINANCIAL GUARANTY/MORTGAGE GUARANTY 1 DISCOUNT FOR 33 NET BALANCE SHEET YEARS IN TIME VALUE RESERVES AFTER DISCOUNT WHICH PRE- OF MONEY INTER- MIUMS WERE 32 COMPANY 34 35 EARNED AND POOLING LOSS LOSSES LOSS PARTICIPATION LOSSES EXPENSES WERE INC EXPENSE PERCENTAGE UNPAID UNPAID 01 PRIOR 0 XXX 0 0 02 1994 0 .000 0 0 03 1995 0 .000 0 0 04 TOTAL 0 XXX 0 0 SCHEDULE P - PART 2A - HOMEOWNERS/FARMOWNERS 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 17,919 20,106 19,415 20,219 21,384 21,069 02 1986 56,595 55,001 54,560 53,367 53,282 53,403 03 1987 XXX 42,008 43,710 42,608 42,822 43,065 04 1988 XXX XXX 42,100 45,946 46,361 46,758 05 1989 XXX XXX XXX 60,606 64,933 64,952 06 1990 XXX XXX XXX XXX 55,260 60,811 07 1991 XXX XXX XXX XXX XXX 63,148 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX 12 TOTAL SCHEDULE P - PART 2A - HOMEOWNERS/FARMOWNERS 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR 20,524 20,351 20,219 20,316 97 -35 02 1986 53,071 53,086 53,161 53,163 3 78 03 1987 42,604 42,440 42,356 42,379 23 -61 04 1988 46,168 46,211 46,313 46,384 71 173 05 1989 64,194 64,119 64,364 64,572 200 444 06 1990 58,039 58,617 59,018 59,373 355 756 07 1991 65,094 66,197 67,158 67,641 483 1,444 08 1992 57,128 55,459 55,994 56,840 846 1,373 09 1993 XXX 58,742 57,042 59,060 2,018 318 10 1994 XXX XXX 61,756 61,019 -738 XXX 11 1995 XXX XXX XXX 62,836 XXX XXX 12 TOTAL 3,366 4,506 SCHEDULE P - PART 2B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 88,574 111,607 117,343 116,962 116,305 116,300 02 1986 208,664 206,747 203,374 200,444 199,712 200,525 03 1987 XXX 213,532 212,109 212,968 214,794 213,779 04 1988 XXX XXX 251,340 253,553 261,105 257,748 05 1989 XXX XXX XXX 308,340 303,896 296,650 06 1990 XXX XXX XXX XXX 379,267 363,269 07 1991 XXX XXX XXX XXX XXX 414,081 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX 12 TOTAL SCHEDULE P - PART 2B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR 114,997 117,887 117,212 117,795 582 -92 02 1986 199,847 198,466 198,945 199,541 596 1,067 03 1987 212,918 213,173 212,990 212,535 -454 -638 04 1988 256,170 256,501 255,870 255,600 -271 -909 05 1989 295,047 296,051 295,646 295,581 -65 -479 06 1990 362,241 362,514 363,657 362,180 -1,486 -334 07 1991 396,713 390,056 388,265 388,695 438 -1,362 08 1992 484,260 453,070 445,880 445,396 -485 -7,675 09 1993 XXX 543,275 529,849 531,423 1,574 -11,845 10 1994 XXX XXX 678,980 672,550 -6,430 XXX 11 1995 XXX XXX XXX 758,581 XXX XXX 12 TOTAL -6,009 -22,257 SCHEDULE P - PART 2C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 106,767 112,845 132,644 132,152 134,340 133,046 02 1986 106,946 107,623 102,235 99,813 99,317 98,314 03 1987 XXX 103,351 101,202 98,676 101,201 97,309 04 1988 XXX XXX 101,819 101,416 106,236 103,943 05 1989 XXX XXX XXX 111,935 117,990 109,572 06 1990 XXX XXX XXX XXX 105,301 97,036 07 1991 XXX XXX XXX XXX XXX 88,837 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX 12 TOTAL SCHEDULE P - PART 2C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR 130,554 127,097 126,130 125,952 -177 -1,145 02 1986 97,519 96,910 97,325 98,686 1,361 1,776 03 1987 97,075 95,375 94,942 95,216 280 -159 04 1988 107,692 106,308 105,501 105,126 -368 -1,182 05 1989 118,792 120,065 116,728 114,046 -2,674 -6,019 06 1990 108,845 105,042 106,719 102,071 -4,648 -2,971 07 1991 87,052 92,809 89,158 81,071 -8,087 -11,738 08 1992 79,247 87,808 89,143 77,238 -11,905 -10,569 09 1993 XXX 105,982 98,678 94,098 -4,580 -11,884 10 1994 XXX XXX 94,747 90,016 -4,731 XXX 11 1995 XXX XXX XXX 88,003 XXX XXX 12 TOTAL -35,540 -43,886 SCHEDULE P - PART 2D - WORKERS' COMPENSATION 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 499,448 527,991 554,412 577,752 579,304 586,244 02 1986 271,328 280,695 281,807 285,085 282,910 287,088 03 1987 XXX 278,375 280,092 282,996 277,654 279,233 04 1988 XXX XXX 355,695 365,193 363,109 357,260 05 1989 XXX XXX XXX 313,178 347,792 340,316 06 1990 XXX XXX XXX XXX 351,858 385,186 07 1991 XXX XXX XXX XXX XXX 327,493 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX 12 TOTAL SCHEDULE P - PART 2D - WORKERS' COMPENSATION 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR 587,142 595,309 622,604 619,349 -3,255 24,040 02 1986 285,569 280,452 280,351 281,567 1,214 1,114 03 1987 282,973 276,304 276,713 276,888 174 584 04 1988 354,690 348,562 337,352 334,777 -2,575 -13,793 05 1989 337,719 330,642 329,776 330,055 278 -588 06 1990 376,429 363,685 355,950 353,566 -2,384 -10,119 07 1991 373,488 360,644 345,252 336,361 -8,891 -24,282 08 1992 336,432 336,837 317,673 292,078 -25,596 -44,759 09 1993 XXX 332,077 325,903 322,931 -2,963 -9,138 10 1994 XXX XXX 365,516 349,473 -16,042 XXX 11 1995 XXX XXX XXX 309,169 XXX XXX 12 TOTAL -60,046 -76,933 SCHEDULE P - PART 2E - COMMERICAL MULTIPLE PERIL 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 155,533 185,871 204,693 222,561 217,516 221,099 02 1986 118,706 102,761 92,241 91,215 88,953 87,062 03 1987 XXX 112,925 98,809 94,736 93,109 96,573 04 1988 XXX XXX 127,648 113,098 112,456 116,128 05 1989 XXX XXX XXX 128,411 125,324 118,908 06 1990 XXX XXX XXX XXX 155,370 143,015 07 1991 XXX XXX XXX XXX XXX 162,856 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX 12 TOTAL SCHEDULE P - PART 2E - COMMERICAL MULTIPLE PERIL 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR 223,617 226,831 236,883 238,729 1,845 11,898 02 1986 87,015 85,898 88,007 89,128 1,122 3,230 03 1987 97,855 95,415 94,155 95,911 1,756 488 04 1988 116,443 119,941 116,496 116,370 -126 -3,570 05 1989 121,606 121,295 120,567 120,641 73 -653 06 1990 143,270 142,966 142,475 143,602 1,127 644 07 1991 145,588 142,906 146,982 142,661 -4,322 -244 08 1992 160,642 138,997 140,812 145,733 4,922 6,736 09 1993 XXX 115,044 110,619 104,638 -5,981 -10,415 10 1994 XXX XXX 126,946 135,717 8,763 XXX 11 1995 XXX XXX XXX 135,334 XXX XXX 12 TOTAL 9,171 8,120 SCHEDULE P - PART 2F - SECTION 1 - MEDICAL MALPRACTICE - OCCURRENCE 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 1,643 1,840 2,146 2,144 2,172 2,154 02 1986 7 6 6 0 0 0 03 1987 XXX 12 0 1 1 1 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX 12 TOTAL SCHEDULE P - PART 2F - SECTION 1 - MEDICAL MALPRACTICE - OCCURRENCE 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR 2,248 2,221 4,127 4,606 471 2,376 02 1986 0 0 0 0 0 0 03 1987 1 1 -13 1 13 0 04 1988 0 0 0 0 0 0 05 1989 0 0 0 0 0 0 06 1990 0 0 -1 0 1 0 07 1991 0 0 0 0 0 0 08 1992 0 -1 -1 -1 0 0 09 1993 XXX 0 0 0 0 0 10 1994 XXX XXX 0 0 0 XXX 11 1995 XXX XXX XXX 0 XXX XXX 12 TOTAL 486 2,376 SCHEDULE P - PART 2F - SECTION 2 - MEDICAL MALPRACTICE - CLAIMS MADE 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX 12 TOTAL SCHEDULE P - PART 2F - SECTION 2 - MEDICAL MALPRACTICE - CLAIMS MADE 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 0 0 0 0 0 0 04 1988 0 0 0 0 0 0 05 1989 0 0 0 0 0 0 06 1990 0 0 0 0 0 0 07 1991 0 0 0 0 0 0 08 1992 0 0 0 0 0 0 09 1993 XXX 0 0 0 0 0 10 1994 XXX XXX 466 754 278 XXX 11 1995 XXX XXX XXX 829 XXX XXX 12 TOTAL 278 0 SCHEDULE P - PART 2G - SPECIAL LIABILITY 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 11,366 11,260 10,507 11,069 11,469 10,835 02 1986 9,160 10,190 9,588 8,999 9,121 8,976 03 1987 XXX 8,543 10,081 9,963 9,571 9,815 04 1988 XXX XXX 8,957 9,756 11,097 11,247 05 1989 XXX XXX XXX 10,156 11,766 12,275 06 1990 XXX XXX XXX XXX 12,135 16,808 07 1991 XXX XXX XXX XXX XXX 14,809 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX 12 TOTAL SCHEDULE P - PART 2G - SPECIAL LIABILITY 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR 10,426 10,307 10,012 10,419 415 111 02 1986 8,935 9,043 8,988 9,084 96 41 03 1987 9,594 9,757 9,653 9,696 43 -62 04 1988 11,001 11,306 11,309 11,257 -52 -48 05 1989 12,360 12,806 13,111 13,138 27 324 06 1990 17,108 17,944 18,090 18,038 -52 94 07 1991 19,520 19,248 19,387 20,123 736 876 08 1992 21,853 27,628 27,417 27,490 73 -138 09 1993 XXX 27,253 32,085 33,031 946 5,778 10 1994 XXX XXX 34,321 35,336 1,016 XXX 11 1995 XXX XXX XXX 32,810 XXX XXX 12 TOTAL 3,240 6,976 SCHEDULE P - PART 2H - SECTION 1 - OTHER LIABILITY - OCCURRENCE 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 246,964 244,617 261,090 308,092 348,521 342,862 02 1986 196,751 175,883 174,494 130,383 126,596 111,715 03 1987 XXX 165,165 149,853 137,134 123,853 106,834 04 1988 XXX XXX 106,989 117,293 117,044 109,866 05 1989 XXX XXX XXX 78,527 82,736 77,708 06 1990 XXX XXX XXX XXX 79,427 83,768 07 1991 XXX XXX XXX XXX XXX 98,746 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX 12 TOTAL SCHEDULE P - PART 2H - SECTION 1 - OTHER LIABILITY - OCCURRENCE 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR 399,182 446,448 521,521 520,827 -703 74,379 02 1986 104,233 97,028 98,317 97,092 -1,225 64 03 1987 102,074 89,562 88,145 88,197 51 -1,367 04 1988 118,186 113,417 100,490 94,205 -6,285 -19,212 05 1989 77,782 73,283 66,022 68,163 2,139 -5,121 06 1990 77,294 81,506 65,325 59,354 -5,970 -22,152 07 1991 91,212 99,586 77,735 76,402 -1,324 -23,184 08 1992 76,695 92,630 82,156 65,222 -16,925 -27,408 09 1993 XXX 96,060 90,503 92,819 2,316 -3,240 10 1994 XXX XXX 92,036 104,109 12,072 XXX 11 1995 XXX XXX XXX 121,897 XXX XXX 12 TOTAL -15,854 -27,249 SCHEDULE P - PART 2H - SECTION 2 - OTHER LIABILITY - CLAIMS MADE 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 984 629 110 275 210 135 02 1986 10,441 7,154 6,777 4,409 3,224 2,204 03 1987 XXX 38,067 41,765 29,596 18,316 13,441 04 1988 XXX XXX 46,121 33,159 31,539 28,778 05 1989 XXX XXX XXX 38,938 33,780 34,685 06 1990 XXX XXX XXX XXX 54,594 50,313 07 1991 XXX XXX XXX XXX XXX 47,267 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX 12 TOTAL SCHEDULE P - PART 2H - SECTION 2 - OTHER LIABILITY - CLAIMS MADE 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR 110 72 72 72 0 0 02 1986 1,766 1,494 1,496 1,447 -49 -47 03 1987 10,859 9,288 8,178 5,450 -2,729 -3,839 04 1988 9,477 8,080 7,217 7,496 279 -584 05 1989 30,466 23,537 15,678 14,975 -711 -8,570 06 1990 54,907 56,358 49,326 45,784 -3,534 -10,574 07 1991 46,880 44,143 21,752 17,511 -4,241 -26,633 08 1992 56,648 51,749 50,690 28,063 -22,627 -23,687 09 1993 XXX 68,578 68,999 62,780 -6,210 -5,797 10 1994 XXX XXX 90,048 83,081 -6,967 XXX 11 1995 XXX XXX XXX 91,005 XXX XXX 12 TOTAL -46,790 -79,722 SCHEDULE P - PART 2I - SPECIAL PROPERTY 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1994 XXX XXX XXX XXX XXX XXX 03 1995 XXX XXX XXX XXX XXX XXX 04 TOTAL SCHEDULE P - PART 2I - SPECIAL PROPERTY 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR XXX 42,265 42,538 40,728 -1,818 -1,536 02 1994 XXX XXX 150,169 165,960 15,783 XXX 03 1995 XXX XXX XXX 191,053 XXX XXX 04 TOTAL 13,973 -1,536 SCHEDULE P - PART 2J - AUTO PHYSICAL DAMAGE 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1994 XXX XXX XXX XXX XXX XXX 03 1995 XXX XXX XXX XXX XXX XXX 04 TOTAL SCHEDULE P - PART 2J - AUTO PHYSICAL DAMAGE 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR XXX 40,373 26,066 24,953 -1,114 -15,420 02 1994 XXX XXX 307,906 298,098 -9,809 XXX 03 1995 XXX XXX XXX 397,240 XXX XXX 04 TOTAL -10,942 -14,148 SCHEDULE P - PART 2K - FIDELITY, SURETY 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1994 XXX XXX XXX XXX XXX XXX 03 1995 XXX XXX XXX XXX XXX XXX 04 TOTAL SCHEDULE P - PART 2K - FIDELITY, SURETY 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR XXX 3,350 8,155 1,757 -6,390 -1,585 02 1994 XXX XXX 7,302 2,054 -5,248 XXX 03 1995 XXX XXX XXX 21,781 XXX XXX 04 TOTAL -11,639 -1,585 SCHEDULE P - PART 2L - OTHER (INCLUDING CREDIT, ACCIDENT AND HEALTH) 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1994 XXX XXX XXX XXX XXX XXX 03 1995 XXX XXX XXX XXX XXX XXX 04 TOTAL SCHEDULE P - PART 2L - OTHER (INCLUDING CREDIT, ACCIDENT AND HEALTH) 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR XXX 2,381 2,508 1,704 -804 -684 02 1994 XXX XXX 2,244 2,547 295 XXX 03 1995 XXX XXX XXX 5,284 XXX XXX 04 TOTAL -509 -684 SCHEDULE P - PART 2M - INTERNATIONAL 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 1,690 1,869 2,441 2,866 2,996 3,201 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX 12 TOTAL SCHEDULE P - PART 2M - INTERNATIONAL 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR 4,316 5,139 3,636 3,694 58 -1,445 02 1986 0 0 0 0 0 0 03 1987 0 0 0 0 0 0 04 1988 0 0 0 0 0 0 05 1989 0 0 0 0 0 0 06 1990 0 0 0 0 0 0 07 1991 0 0 0 0 0 0 08 1992 0 0 0 0 0 0 09 1993 XXX 0 0 0 0 0 10 1994 XXX XXX 0 0 0 XXX 11 1995 XXX XXX XXX 0 XXX XXX 12 TOTAL 58 -1,445 SCHEDULE P - PART 2N - REINSURANCE A 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 1988 XXX XXX 0 0 0 0 02 1989 XXX XXX XXX 0 0 0 03 1990 XXX XXX XXX XXX 0 0 04 1991 XXX XXX XXX XXX XXX 0 05 1992 XXX XXX XXX XXX XXX XXX 06 1993 XXX XXX XXX XXX XXX XXX 07 1994 XXX XXX XXX XXX XXX XXX 08 1995 XXX XXX XXX XXX XXX XXX 09 TOTAL SCHEDULE P - PART 2N - REINSURANCE A 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 1988 0 0 0 0 0 0 02 1989 0 0 0 0 0 0 03 1990 0 0 0 0 0 0 04 1991 0 0 0 0 0 0 05 1992 0 0 0 0 0 0 06 1993 XXX 0 0 0 0 XXX 07 1994 XXX XXX 0 0 0 XXX 08 1995 XXX XXX XXX 0 XXX XXX 09 TOTAL 0 0 SCHEDULE P - PART 2O - REINSURANCE B 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 1988 XXX XXX 0 0 0 0 02 1989 XXX XXX XXX 0 0 0 03 1990 XXX XXX XXX XXX 0 0 04 1991 XXX XXX XXX XXX XXX 0 05 1992 XXX XXX XXX XXX XXX XXX 06 1993 XXX XXX XXX XXX XXX XXX 07 1994 XXX XXX XXX XXX XXX XXX 08 1995 XXX XXX XXX XXX XXX XXX 09 TOTAL SCHEDULE P - PART 2O - REINSURANCE B 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 1988 0 0 0 0 0 0 02 1989 0 0 0 0 0 0 03 1990 0 0 0 0 0 0 04 1991 0 0 0 0 0 0 05 1992 0 0 0 0 0 0 06 1993 XXX 0 0 0 0 XXX 07 1994 XXX XXX 0 0 0 XXX 08 1995 XXX XXX XXX 0 XXX XXX 09 TOTAL 0 0 SCHEDULE P - PART 2P - REINSURANCE C 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 1988 XXX XXX 0 0 0 0 02 1989 XXX XXX XXX 0 0 0 03 1990 XXX XXX XXX XXX 0 0 04 1991 XXX XXX XXX XXX XXX 0 05 1992 XXX XXX XXX XXX XXX XXX 06 1993 XXX XXX XXX XXX XXX XXX 07 1994 XXX XXX XXX XXX XXX XXX 08 1995 XXX XXX XXX XXX XXX XXX 09 TOTAL SCHEDULE P - PART 2P - REINSURANCE C 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 1988 0 0 0 0 0 0 02 1989 0 0 0 0 0 0 03 1990 0 0 0 0 0 0 04 1991 0 0 0 0 0 0 05 1992 0 0 0 0 0 0 06 1993 XXX 0 0 0 0 XXX 07 1994 XXX XXX 0 0 0 XXX 08 1995 XXX XXX XXX 0 XXX XXX 09 TOTAL 0 0 SCHEDULE P - PART 2Q - REINSURANCE D 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 1,392 2,296 2,933 244,914 4,735 5,056 02 1986 2,085 1,970 2,892 3,104 3,223 3,175 03 1987 XXX 6,560 10,174 10,460 10,527 10,458 04 1988 SCHEDULE P - PART 2Q - REINSURANCE D 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR 5,943 5,859 6,158 8,317 2,159 2,458 02 1986 3,074 3,673 3,673 2,296 -1,377 -1,377 03 1987 10,459 10,459 10,457 10,458 1 -1 04 1988 783 1,080 SCHEDULE P - PART 2R - SECTION 1 - PRODUCTS LIABILITY - OCCURRENCE 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 29,414 34,331 43,887 44,438 39,339 47,480 02 1986 47,413 45,863 44,066 39,509 30,320 27,913 03 1987 XXX 40,347 36,661 36,188 26,992 18,178 04 1988 XXX XXX 40,426 17,421 21,155 20,891 05 1989 XXX XXX XXX 13,667 10,753 12,535 06 1990 XXX XXX XXX XXX 10,847 13,954 07 1991 XXX XXX XXX XXX XXX 8,390 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX 12 TOTAL SCHEDULE P - PART 2R - SECTION 1 - PRODUCTS LIABILITY - OCCURRENCE 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR 49,516 61,864 73,039 71,288 -1,750 9,425 02 1986 26,023 24,472 25,469 24,306 -1,162 -165 03 1987 12,699 11,895 12,552 15,794 3,242 3,899 04 1988 9,224 10,457 10,995 9,363 -1,640 -1,103 05 1989 8,850 10,529 8,616 10,905 2,289 376 06 1990 11,374 13,461 10,278 9,347 -930 -4,114 07 1991 6,221 9,424 7,300 7,988 688 -1,436 08 1992 3,117 6,747 6,224 6,984 752 237 09 1993 XXX 4,243 5,016 4,368 -648 133 10 1994 XXX XXX 7,659 5,053 -2,606 XXX 11 1995 XXX XXX XXX 12,496 XXX XXX 12 TOTAL -1,767 7,252 SCHEDULE P - PART 2R - SECTION 2 - PRODUCTS LIABILITY - CLAIMS MADE 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 145 102 111 21 13 5 02 1986 2,528 2,161 1,609 1,281 788 365 03 1987 XXX 10,677 7,794 10,524 10,663 10,107 04 1988 XXX XXX 6,162 8,023 8,587 7,992 05 1989 XXX XXX XXX 6,119 5,609 5,669 06 1990 XXX XXX XXX XXX 4,195 3,990 07 1991 XXX XXX XXX XXX XXX 5,013 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX 12 TOTAL SCHEDULE P - PART 2R - SECTION 2 - PRODUCTS LIABILITY - CLAIMS MADE 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR 3 0 0 0 0 0 02 1986 203 7 7 8 1 1 03 1987 8,509 4,027 3,905 3,320 -594 -715 04 1988 7,636 2,720 1,653 1,642 -11 -1,078 05 1989 5,539 2,562 1,463 1,463 0 -1,090 06 1990 4,190 3,314 2,709 2,635 -73 -679 07 1991 5,529 1,853 1,162 843 -319 -1,010 08 1992 3,452 2,471 1,573 1,505 -69 -973 09 1993 XXX 1,905 1,504 1,458 -46 -439 10 1994 XXX XXX 877 649 -220 XXX 11 1995 XXX XXX XXX 421 XXX XXX 12 TOTAL -1,340 -5,984 SCHEDULE P - PART 2S - FINANCIAL GUARANTY/MORTGAGE GUARANTY 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1994 XXX XXX XXX XXX XXX XXX 03 1995 XXX XXX XXX XXX XXX XXX 04 TOTAL SCHEDULE P - PART 2S - FINANCIAL GUARANTY/MORTGAGE GUARANTY 1 INCURRED LOSSES AND ALLOCATED EXPENSES REPORTED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 ONE YEAR TWO YEAR LOSSES WERE DEVELOPMENT DEVELOPMENT INCURRED 01 PRIOR XXX 0 0 0 0 0 02 1994 XXX XXX 0 0 0 XXX 03 1995 XXX XXX XXX 0 XXX XXX 04 TOTAL 0 0 SCHEDULE P - PART 3A - HOMEOWNERS/FARMOWNERS 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 7,390 12,887 15,596 17,094 18,092 02 1986 35,399 48,069 50,620 52,003 52,520 52,759 03 1987 XXX 26,642 37,927 40,429 41,797 42,279 04 1988 XXX XXX 29,202 41,834 44,344 45,149 05 1989 XXX XXX XXX 42,501 58,949 61,309 06 1990 XXX XXX XXX XXX 37,502 54,048 07 1991 XXX XXX XXX XXX XXX 44,356 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3A - HOMEOWNERS/FARMOWNERS 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR 18,355 18,528 18,637 18,854 424 123 02 1986 52,914 53,023 53,149 53,152 30,786 808 03 1987 42,376 42,318 42,300 42,345 22,293 598 04 1988 45,610 45,923 46,053 46,369 21,232 698 05 1989 62,490 63,163 64,101 64,401 29,555 1,247 06 1990 56,092 57,591 58,641 59,004 24,224 1,383 07 1991 59,863 64,652 66,084 66,894 27,364 1,026 08 1992 36,701 50,850 53,582 55,356 21,357 859 09 1993 XXX 40,058 52,935 56,417 20,795 2,325 10 1994 XXX XXX 43,617 57,546 22,632 4,851 11 1995 XXX XXX XXX 44,775 17,479 3,276 SCHEDULE P - PART 3B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 60,771 88,307 103,194 108,487 109,984 02 1986 81,481 150,953 177,622 191,065 196,328 197,964 03 1987 XXX 85,415 159,210 186,837 201,683 208,551 04 1988 XXX XXX 101,708 189,339 227,870 245,403 05 1989 XXX XXX XXX 115,407 221,016 262,427 06 1990 XXX XXX XXX XXX 145,989 267,498 07 1991 XXX XXX XXX XXX XXX 160,362 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR 111,944 112,254 112,452 113,245 6 1 02 1986 198,054 198,766 199,249 199,272 73,075 26,536 03 1987 210,805 212,045 212,521 212,771 71,675 26,913 04 1988 251,980 254,139 255,252 255,461 86,382 30,925 05 1989 283,768 290,554 293,614 293,965 125,822 48,224 06 1990 318,313 344,465 354,132 357,537 145,606 58,769 07 1991 297,485 352,297 373,536 383,027 158,925 59,319 08 1992 182,458 344,583 403,479 426,003 170,651 64,001 09 1993 XXX 223,178 415,480 483,443 201,632 80,859 10 1994 XXX XXX 287,892 533,024 250,700 104,820 11 1995 XXX XXX XXX 313,473 184,732 79,120 SCHEDULE P - PART 3C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 49,581 79,317 102,554 111,605 114,641 02 1986 16,724 44,979 62,954 79,284 88,174 92,772 03 1987 XXX 16,544 43,887 62,682 79,180 86,147 04 1988 XXX XXX 18,821 46,711 69,932 84,546 05 1989 XXX XXX XXX 22,090 52,569 80,492 06 1990 XXX XXX XXX XXX 18,599 46,515 07 1991 XXX XXX XXX XXX XXX 16,658 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR 115,953 116,401 115,489 115,662 84 196 02 1986 93,914 94,994 95,463 95,840 15,701 2,978 03 1987 91,311 93,111 93,947 94,127 14,858 2,790 04 1988 96,841 101,351 103,654 104,195 15,727 3,582 05 1989 96,126 107,320 111,750 112,911 17,020 4,591 06 1990 73,654 89,136 95,366 98,855 15,151 3,807 07 1991 41,816 56,193 64,765 70,256 13,170 3,597 08 1992 14,486 35,313 50,236 60,547 12,730 4,081 09 1993 XXX 15,407 35,837 63,337 14,704 6,102 10 1994 XXX XXX 17,427 40,579 15,881 7,481 11 1995 XXX XXX XXX 22,052 10,664 4,037 SCHEDULE P - PART 3D - WORKERS' COMPENSATION 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 154,604 258,384 333,025 380,975 421,622 02 1986 56,064 129,701 183,884 219,180 239,128 253,291 03 1987 XXX 51,104 129,446 182,804 216,932 237,859 04 1988 XXX XXX 56,978 141,390 201,784 240,107 05 1989 XXX XXX XXX 59,077 150,052 218,352 06 1990 XXX XXX XXX XXX 72,446 183,139 07 1991 XXX XXX XXX XXX XXX 72,943 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3D - WORKERS' COMPENSATION 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR 447,018 462,307 480,505 496,914 293 87 02 1986 260,373 265,021 268,340 270,497 74,097 3,312 03 1987 250,426 258,331 262,474 265,311 71,092 3,967 04 1988 261,410 273,392 288,318 292,404 72,582 4,666 05 1989 256,485 276,718 288,737 296,875 65,960 4,031 06 1990 253,572 292,577 311,580 323,158 65,222 5,188 07 1991 175,902 242,043 277,652 294,879 57,411 4,529 08 1992 65,738 155,130 211,387 237,922 54,629 4,095 09 1993 XXX 63,493 140,328 190,008 50,004 3,834 10 1994 XXX XXX 65,541 154,790 51,189 4,259 11 1995 XXX XXX XXX 65,815 35,216 2,977 SCHEDULE P - PART 3E - COMMERICAL MULTIPLE PERIL 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 64,320 110,987 153,178 182,879 198,759 02 1986 20,742 38,482 49,595 61,798 70,448 76,289 03 1987 XXX 23,354 46,705 59,012 69,554 78,853 04 1988 XXX XXX 29,672 57,416 69,755 83,124 05 1989 XXX XXX XXX 30,117 62,077 79,167 06 1990 XXX XXX XXX XXX 38,153 71,907 07 1991 XXX XXX XXX XXX XXX 47,163 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3E - COMMERICAL MULTIPLE PERIL 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR 207,389 212,042 218,019 220,976 562 296 02 1986 80,181 82,195 84,660 86,633 12,247 2,008 03 1987 86,374 89,327 91,741 92,776 11,133 1,807 04 1988 90,106 100,913 109,565 112,542 12,284 2,101 05 1989 89,731 99,517 108,485 113,686 13,784 2,169 06 1990 92,158 104,898 117,422 123,387 13,856 2,512 07 1991 83,701 100,647 113,968 121,601 13,191 2,583 08 1992 44,118 82,139 97,021 110,572 11,342 2,879 09 1993 XXX 33,199 55,173 68,600 10,675 3,076 10 1994 XXX XXX 46,653 85,031 11,637 3,462 11 1995 XXX XXX XXX 42,814 7,728 1,987 SCHEDULE P - PART 3F - SECTION 1 - MEDICAL MALPRACTICE - OCCURRENCE 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 52 80 130 172 172 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 1 1 1 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3F - SECTION 1 - MEDICAL MALPRACTICE - OCCURRENCE 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR 171 173 375 1,082 0 0 02 1986 0 0 0 0 0 0 03 1987 1 1 -13 1 0 0 04 1988 0 0 0 0 0 0 05 1989 0 0 0 0 0 0 06 1990 0 0 -1 0 0 0 07 1991 0 0 0 0 0 0 08 1992 0 -1 -1 -1 0 0 09 1993 XXX 0 0 0 0 0 10 1994 XXX XXX 0 0 0 0 11 1995 XXX XXX XXX 0 0 0 SCHEDULE P - PART 3F - SECTION 2 - MEDICAL MALPRACTICE - CLAIMS MADE 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3F - SECTION 2 - MEDICAL MALPRACTICE - CLAIMS MADE 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 0 0 0 0 0 0 04 1988 0 0 0 0 0 0 05 1989 0 0 0 0 0 0 06 1990 0 0 0 0 0 0 07 1991 0 0 0 0 0 0 08 1992 0 0 0 0 0 0 09 1993 XXX 0 0 0 0 0 10 1994 XXX XXX 9 80 1 0 11 1995 XXX XXX XXX 205 2 1 SCHEDULE P - PART 3G - SPECIAL LIABILITY 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 2,915 4,048 5,477 6,387 6,494 02 1986 3,613 7,733 8,206 8,517 8,710 8,727 03 1987 XXX 3,913 7,735 8,737 9,105 9,533 04 1988 XXX XXX 3,490 8,224 9,524 9,896 05 1989 XXX XXX XXX 4,046 10,822 11,121 06 1990 XXX XXX XXX XXX 5,670 13,852 07 1991 XXX XXX XXX XXX XXX 7,708 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3G - SPECIAL LIABILITY 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR 6,686 6,700 7,173 7,404 XXX XXX 02 1986 8,805 8,897 8,843 8,928 XXX XXX 03 1987 9,476 9,581 9,499 9,538 XXX XXX 04 1988 10,216 10,341 10,915 10,942 XXX XXX 05 1989 11,798 12,179 12,337 12,676 XXX XXX 06 1990 15,448 16,849 17,482 17,474 XXX XXX 07 1991 16,410 17,755 18,363 18,948 XXX XXX 08 1992 13,652 23,716 24,994 26,199 XXX XXX 09 1993 XXX 17,909 27,623 29,813 XXX XXX 10 1994 XXX XXX 13,559 27,440 XXX XXX 11 1995 XXX XXX XXX 12,456 XXX XXX SCHEDULE P - PART 3H - SECTION 1 - OTHER LIABILITY - OCCURRENCE 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 53,454 98,408 135,962 191,089 221,930 02 1986 3,519 14,848 32,178 49,140 63,782 72,157 03 1987 XXX 3,675 15,093 35,319 49,540 56,204 04 1988 XXX XXX 1,736 17,586 29,217 42,048 05 1989 XXX XXX XXX 1,165 9,089 11,831 06 1990 XXX XXX XXX XXX 1,489 4,382 07 1991 XXX XXX XXX XXX XXX -4,800 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3H - SECTION 1 - OTHER LIABILITY - OCCURRENCE 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR 256,493 297,676 334,606 356,680 4,318 4,518 02 1986 78,818 82,991 86,892 86,888 6,794 3,551 03 1987 65,511 75,441 79,356 79,857 5,601 2,317 04 1988 61,504 68,379 76,631 77,761 4,559 1,725 05 1989 26,959 37,859 42,748 45,397 3,707 1,605 06 1990 16,959 26,964 32,668 36,765 3,177 1,528 07 1991 11,305 21,572 33,568 41,963 3,038 1,367 08 1992 5,172 11,868 24,062 30,172 4,184 1,382 09 1993 XXX 3,241 9,961 22,288 3,943 1,411 10 1994 XXX XXX 513 18,637 3,395 1,630 11 1995 XXX XXX XXX 12,083 1,055 806 SCHEDULE P - PART 3H - SECTION 2 - OTHER LIABILITY - CLAIMS MADE 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 4 28 58 71 71 02 1986 88 323 720 1,280 1,342 1,408 03 1987 XXX 189 3,460 3,630 5,595 6,734 04 1988 XXX XXX 1,599 2,227 2,993 3,716 05 1989 XXX XXX XXX 727 2,497 5,667 06 1990 XXX XXX XXX XXX 520 5,681 07 1991 XXX XXX XXX XXX XXX 1,827 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3H - SECTION 2 - OTHER LIABILITY - CLAIMS MADE 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR 71 72 72 72 12 18 02 1986 1,426 1,431 1,444 1,447 41 60 03 1987 6,583 7,818 7,880 5,428 191 252 04 1988 5,669 6,604 7,030 7,531 112 166 05 1989 7,681 9,727 12,388 13,970 87 168 06 1990 18,452 21,607 31,769 41,540 112 200 07 1991 3,096 5,488 6,411 9,164 124 294 08 1992 785 9,816 15,932 18,844 108 246 09 1993 XXX 159 5,010 8,608 148 276 10 1994 XXX XXX 3,412 30,063 93 314 11 1995 XXX XXX XXX -3,806 31 3 SCHEDULE P - PART 3I - SPECIAL PROPERTY 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1994 XXX XXX XXX XXX XXX XXX 03 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3I - SPECIAL PROPERTY 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR XXX 0 23,874 29,704 XXX XXX 02 1994 XXX XXX 93,049 135,489 XXX XXX 03 1995 XXX XXX XXX 103,291 XXX XXX SCHEDULE P - PART 3J - AUTO PHYSICAL DAMAGE 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1994 XXX XXX XXX XXX XXX XXX 03 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3J - AUTO PHYSICAL DAMAGE 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR XXX 0 20,802 19,597 144,035 45,366 02 1994 XXX XXX 267,418 299,726 233,758 77,341 03 1995 XXX XXX XXX 352,217 218,947 65,809 SCHEDULE P - PART 3K - FIDELITY, SURETY 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1994 XXX XXX XXX XXX XXX XXX 03 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3K - FIDELITY, SURETY 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR XXX 0 5,303 4,761 XXX XXX 02 1994 XXX XXX 1,670 3,050 XXX XXX 03 1995 XXX XXX XXX 2,612 XXX XXX SCHEDULE P - PART 3L - OTHER (INCLUDING CREDIT, ACCIDENT AND HEALTH) 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1994 XXX XXX XXX XXX XXX XXX 03 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3L - OTHER (INCLUDING CREDIT, ACCIDENT AND HEALTH) 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR XXX 0 653 845 XXX XXX 02 1994 XXX XXX 64 888 XXX XXX 03 1995 XXX XXX XXX -102 XXX XXX SCHEDULE P - PART 3M - INTERNATIONAL 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 74 505 970 1,154 1,309 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3M - INTERNATIONAL 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR 1,660 1,775 -458 77 XXX XXX 02 1986 0 0 0 0 XXX XXX 03 1987 0 0 0 0 XXX XXX 04 1988 0 0 0 0 XXX XXX 05 1989 0 0 0 0 XXX XXX 06 1990 0 0 0 0 XXX XXX 07 1991 0 0 0 0 XXX XXX 08 1992 0 0 0 0 XXX XXX 09 1993 XXX 0 0 0 XXX XXX 10 1994 XXX XXX 0 0 XXX XXX 11 1995 XXX XXX XXX 0 XXX XXX SCHEDULE P - PART 3N - REINSURANCE A 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 1988 XXX XXX 0 0 0 0 02 1989 XXX XXX XXX 0 0 0 03 1990 XXX XXX XXX XXX 0 0 04 1991 XXX XXX XXX XXX XXX 0 05 1992 XXX XXX XXX XXX XXX XXX 06 1993 XXX XXX XXX XXX XXX XXX 07 1994 XXX XXX XXX XXX XXX XXX 08 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3N - REINSURANCE A 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 1988 0 0 0 0 XXX XXX 02 1989 0 0 0 0 XXX XXX 03 1990 0 0 0 0 XXX XXX 04 1991 0 0 0 0 XXX XXX 05 1992 0 0 0 0 XXX XXX 06 1993 XXX 0 0 0 XXX XXX 07 1994 XXX XXX 0 0 XXX XXX 08 1995 XXX XXX XXX 0 XXX XXX SCHEDULE P - PART 3O - REINSURANCE B 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 1988 XXX XXX 0 0 0 0 02 1989 XXX XXX XXX 0 0 0 03 1990 XXX XXX XXX XXX 0 0 04 1991 XXX XXX XXX XXX XXX 0 05 1992 XXX XXX XXX XXX XXX XXX 06 1993 XXX XXX XXX XXX XXX XXX 07 1994 XXX XXX XXX XXX XXX XXX 08 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3O - REINSURANCE B 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 1988 0 0 0 0 XXX XXX 02 1989 0 0 0 0 XXX XXX 03 1990 0 0 0 0 XXX XXX 04 1991 0 0 0 0 XXX XXX 05 1992 0 0 0 0 XXX XXX 06 1993 XXX 0 0 0 XXX XXX 07 1994 XXX XXX 0 0 XXX XXX 08 1995 XXX XXX XXX 0 XXX XXX SCHEDULE P - PART 3P - REINSURANCE C 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 1988 XXX XXX 0 0 0 0 02 1989 XXX XXX XXX 0 0 0 03 1990 XXX XXX XXX XXX 0 0 04 1991 XXX XXX XXX XXX XXX 0 05 1992 XXX XXX XXX XXX XXX XXX 06 1993 XXX XXX XXX XXX XXX XXX 07 1994 XXX XXX XXX XXX XXX XXX 08 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3P - REINSURANCE C 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 1988 0 0 0 0 XXX XXX 02 1989 0 0 0 0 XXX XXX 03 1990 0 0 0 0 XXX XXX 04 1991 0 0 0 0 XXX XXX 05 1992 0 0 0 0 XXX XXX 06 1993 XXX 0 0 0 XXX XXX 07 1994 XXX XXX 0 0 XXX XXX 08 1995 XXX XXX XXX 0 XXX XXX SCHEDULE P - PART 3Q - REINSURANCE D 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 347 546 -303 801 1,177 02 1986 0 317 481 692 1,005 1,024 03 1987 XXX -127 3,519 10,460 9,597 10,396 SCHEDULE P - PART 3Q - REINSURANCE D 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR 2,283 2,869 3,111 3,683 XXX XXX 02 1986 1,773 1,774 1,879 1,914 XXX XXX 03 1987 8,392 9,324 9,166 9,061 XXX XXX SCHEDULE P - PART 3R - SECTION 1 - PRODUCTS LIABILITY - OCCURRENCE 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 7,527 13,250 15,870 23,466 28,497 02 1986 201 1,028 3,187 6,276 11,147 14,584 03 1987 XXX 199 908 2,104 3,068 4,965 04 1988 XXX XXX 1,243 1,464 3,068 6,213 05 1989 XXX XXX XXX 50 899 1,098 06 1990 XXX XXX XXX XXX 399 -234 07 1991 XXX XXX XXX XXX XXX -110 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3R - SECTION 1 - PRODUCTS LIABILITY - OCCURRENCE 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR 33,167 35,924 34,779 35,133 182 785 02 1986 16,415 18,603 18,949 20,089 394 458 03 1987 4,915 6,626 8,573 9,272 268 270 04 1988 2,357 3,574 5,356 7,717 179 139 05 1989 2,265 3,364 3,796 4,350 127 117 06 1990 -610 903 1,169 2,406 218 109 07 1991 -869 426 1,174 1,542 223 120 08 1992 -98 290 980 2,103 162 73 09 1993 XXX -64 35 47 206 65 10 1994 XXX XXX 143 321 164 52 11 1995 XXX XXX XXX 244 138 33 SCHEDULE P - PART 3R - SECTION 2 - PRODUCTS LIABILITY - CLAIMS MADE 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 0 0 0 0 0 02 1986 0 6 7 7 9 9 03 1987 XXX 47 883 1,836 2,433 3,322 04 1988 XXX XXX 168 425 835 1,370 05 1989 XXX XXX XXX 41 188 1,174 06 1990 XXX XXX XXX XXX 44 915 07 1991 XXX XXX XXX XXX XXX 100 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3R - SECTION 2 - PRODUCTS LIABILITY - CLAIMS MADE 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR 0 0 0 0 0 0 02 1986 9 7 7 8 2 10 03 1987 3,321 3,403 3,403 3,320 120 56 04 1988 1,523 1,628 1,633 1,633 75 48 05 1989 1,454 1,466 1,455 1,460 118 64 06 1990 2,113 2,108 2,678 2,628 53 37 07 1991 1,066 144 359 397 278 50 08 1992 160 671 842 943 49 26 09 1993 XXX 69 204 1,047 34 14 10 1994 XXX XXX 2 260 47 9 11 1995 XXX XXX XXX -78 17 2 SCHEDULE P - PART 3S - FINANCIAL GUARANTY/MORTGAGE GUARANTY 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1994 XXX XXX XXX XXX XXX XXX 03 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 3S - FINANCIAL GUARANTY/MORTGAGE GUARANTY 1 CUMULATIVE PAID LOSSES AND ALLOCATED EXPENSES AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 NUMBER OF NUMBER OF LOSSES WERE CLMS CLOSED CLMS CLOSED INCURRED WITH LOSS WITHOUT LOSS PAYMENT PAYMENT 01 PRIOR XXX 0 0 0 XXX XXX 02 1994 XXX XXX 0 0 XXX XXX 03 1995 XXX XXX XXX 0 XXX XXX SCHEDULE P - PART 4A - HOMEOWNERS/FARMOWNERS 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 3,124 1,314 991 1,221 912 608 02 1986 10,114 2,721 1,570 451 420 356 03 1987 XXX 4,465 2,138 397 398 453 04 1988 XXX XXX 4,186 1,278 749 813 05 1989 XXX XXX XXX 11,301 1,847 1,168 06 1990 XXX XXX XXX XXX 7,567 2,254 07 1991 XXX XXX XXX XXX XXX 7,529 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4A - HOMEOWNERS/FARMOWNERS 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR 362 333 246 249 02 1986 43 17 12 12 03 1987 99 72 -4 0 04 1988 -12 9 -8 -1 05 1989 -8 -94 -37 -5 06 1990 -557 -12 -102 -51 07 1991 709 234 -140 -29 08 1992 13,252 594 -124 -71 09 1993 XXX 9,847 788 -94 10 1994 XXX XXX 10,280 1,119 11 1995 XXX XXX XXX 8,764 SCHEDULE P - PART 4B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 12,707 12,249 7,495 2,115 1,214 445 02 1986 42,458 18,294 9,026 3,240 956 1,540 03 1987 XXX 41,116 14,325 6,412 2,894 1,182 04 1988 XXX XXX 52,273 17,618 9,462 2,736 05 1989 XXX XXX XXX 73,655 24,460 6,365 06 1990 XXX XXX XXX XXX 95,750 28,835 07 1991 XXX XXX XXX XXX XXX 100,408 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR 47 854 903 838 02 1986 794 -885 -567 50 03 1987 51 18 -112 -542 04 1988 516 831 -44 -166 05 1989 1,209 729 22 -30 06 1990 10,754 5,946 4,289 493 07 1991 34,982 10,602 2,892 490 08 1992 120,061 35,739 14,114 5,996 09 1993 XXX 112,743 33,615 11,938 10 1994 XXX XXX 130,847 35,211 11 1995 XXX XXX XXX 147,562 SCHEDULE P - PART 4C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 21,630 12,842 9,873 6,937 4,133 3,234 02 1986 40,974 27,187 14,441 8,975 3,664 3,094 03 1987 XXX 42,593 24,931 15,343 9,878 4,569 04 1988 XXX XXX 36,559 19,417 11,589 4,960 05 1989 XXX XXX XXX 36,316 20,786 6,598 06 1990 XXX XXX XXX XXX 39,785 16,538 07 1991 XXX XXX XXX XXX XXX 42,162 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR 2,433 506 684 823 02 1986 2,278 1,459 1,497 2,786 03 1987 2,565 1,008 506 995 04 1988 3,906 2,031 209 -22 05 1989 8,699 5,984 2,242 534 06 1990 14,990 4,918 5,505 1,787 07 1991 22,338 19,232 14,765 6,111 08 1992 32,955 27,064 22,007 8,399 09 1993 XXX 54,535 28,005 12,630 10 1994 XXX XXX 38,346 18,474 11 1995 XXX XXX XXX 30,171 SCHEDULE P - PART 4D - WORKERS' COMPENSATION 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 72,683 54,725 44,190 49,705 34,390 26,318 02 1986 87,399 48,569 27,924 20,007 14,679 11,940 03 1987 XXX 85,751 34,637 24,607 19,294 14,624 04 1988 XXX XXX 110,137 50,338 35,976 29,657 05 1989 XXX XXX XXX 96,353 51,114 31,674 06 1990 XXX XXX XXX XXX 96,771 55,160 07 1991 XXX XXX XXX XXX XXX 83,929 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4D - WORKERS' COMPENSATION 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR 19,887 17,293 19,041 14,961 02 1986 8,303 2,147 1,814 1,420 03 1987 12,865 5,075 2,890 2,599 04 1988 25,494 18,354 3,730 2,988 05 1989 23,695 13,397 7,463 5,162 06 1990 33,770 18,446 9,978 6,851 07 1991 51,943 30,583 15,042 7,931 08 1992 94,868 63,417 38,312 11,044 09 1993 XXX 108,984 84,109 68,266 10 1994 XXX XXX 110,444 78,671 11 1995 XXX XXX XXX 84,806 SCHEDULE P - PART 4E - COMMERICAL MULTIPLE PERIL 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 38,439 30,511 25,655 29,730 11,630 5,684 02 1986 71,661 42,254 22,243 12,664 7,659 4,505 03 1987 XXX 67,563 31,523 16,269 7,660 5,779 04 1988 XXX XXX 63,356 33,308 18,108 14,148 05 1989 XXX XXX XXX 56,360 28,134 14,464 06 1990 XXX XXX XXX XXX 73,887 29,172 07 1991 XXX XXX XXX XXX XXX 71,469 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4E - COMMERICAL MULTIPLE PERIL 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR 2,977 2,819 11,588 11,454 02 1986 1,305 594 1,031 1,029 03 1987 4,545 2,362 408 464 04 1988 9,236 6,476 463 -178 05 1989 7,889 6,233 2,105 967 06 1990 21,781 16,364 12,456 10,666 07 1991 29,894 19,724 16,739 8,876 08 1992 64,303 26,029 17,815 13,427 09 1993 XXX 57,408 31,395 15,979 10 1994 XXX XXX 40,251 18,558 11 1995 XXX XXX XXX 42,880 SCHEDULE P - PART 4F - SECTION 1 - MEDICAL MALPRACTICE - OCCURRENCE 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 1,455 1,377 1,399 1,409 1,409 1,395 02 1986 7 6 6 0 0 0 03 1987 XXX 12 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4F - SECTION 1 - MEDICAL MALPRACTICE - OCCURRENCE 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR 1,395 1,392 1,384 1,384 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 0 11 1995 XXX XXX XXX 0 SCHEDULE P - PART 4F - SECTION 2 - MEDICAL MALPRACTICE - CLAIMS MADE 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4F - SECTION 2 - MEDICAL MALPRACTICE - CLAIMS MADE 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 0 11 1995 XXX XXX XXX 0 SCHEDULE P - PART 4G - SPECIAL LIABILITY 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 2,989 2,739 2,763 2,499 2,543 2,056 02 1986 1,376 717 430 -63 110 71 03 1987 XXX 1,029 235 -35 54 75 04 1988 XXX XXX 1,219 146 573 615 05 1989 XXX XXX XXX 745 -27 39 06 1990 XXX XXX XXX XXX 118 79 07 1991 XXX XXX XXX XXX XXX 347 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4G - SPECIAL LIABILITY 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR 1,879 1,446 1,265 1,277 02 1986 4 11 10 10 03 1987 30 21 20 37 04 1988 459 595 92 70 05 1989 -49 65 62 73 06 1990 -179 82 159 131 07 1991 16 106 237 205 08 1992 1,059 -458 -416 -180 09 1993 XXX 164 -1,536 -819 10 1994 XXX XXX 401 -1,279 11 1995 XXX XXX XXX 7,343 SCHEDULE P - PART 4H - SECTION 1 - OTHER LIABILITY - OCCURRENCE 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 93,532 58,576 47,149 60,508 51,726 50,985 02 1986 170,250 132,641 117,821 62,360 48,669 28,957 03 1987 XXX 144,548 110,923 80,178 55,378 38,547 04 1988 XXX XXX 92,601 80,250 70,470 56,065 05 1989 XXX XXX XXX 66,748 55,426 48,969 06 1990 XXX XXX XXX XXX 72,126 68,918 07 1991 XXX XXX XXX XXX XXX 95,940 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4H - SECTION 1 - OTHER LIABILITY - OCCURRENCE 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR 47,434 45,106 83,026 84,839 02 1986 17,479 8,297 8,166 6,898 03 1987 25,444 9,192 5,255 4,792 04 1988 46,024 39,646 21,531 14,287 05 1989 38,404 32,548 19,623 20,878 06 1990 45,388 45,240 27,073 19,226 07 1991 60,525 58,820 32,652 26,048 08 1992 61,200 57,152 44,699 28,002 09 1993 XXX 84,851 60,757 48,815 10 1994 XXX XXX 78,777 58,910 11 1995 XXX XXX XXX 87,166 SCHEDULE P - PART 4H - SECTION 2 - OTHER LIABILITY - CLAIMS MADE 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 959 545 45 212 139 64 02 1986 10,098 6,305 5,546 3,013 1,839 787 03 1987 XXX 31,352 26,846 22,540 12,378 6,499 04 1988 XXX XXX 33,022 23,518 22,443 20,773 05 1989 XXX XXX XXX 20,724 17,445 12,521 06 1990 XXX XXX XXX XXX 12,289 6,732 07 1991 XXX XXX XXX XXX XXX 30,774 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4H - SECTION 2 - OTHER LIABILITY - CLAIMS MADE 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR 39 0 0 0 02 1986 340 0 0 0 03 1987 2,736 1,443 12 0 04 1988 1,702 307 12 0 05 1989 6,013 967 24 0 06 1990 11,731 2,355 128 35 07 1991 32,825 29,763 6,051 2,426 08 1992 41,298 28,740 27,864 4,768 09 1993 XXX 51,077 40,011 35,914 10 1994 XXX XXX 44,763 18,773 11 1995 XXX XXX XXX 64,183 SCHEDULE P - PART 4I - SPECIAL PROPERTY 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1994 XXX XXX XXX XXX XXX XXX 03 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4I - SPECIAL PROPERTY 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR XXX 19,823 7,436 5,289 02 1994 XXX XXX 9,086 1,713 03 1995 XXX XXX XXX 22,785 SCHEDULE P - PART 4J - AUTO PHYSICAL DAMAGE 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1994 XXX XXX XXX XXX XXX XXX 03 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4J - AUTO PHYSICAL DAMAGE 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR XXX 18,186 3,602 2,321 02 1994 XXX XXX 20,940 -344 03 1995 XXX XXX XXX 19,225 SCHEDULE P - PART 4K - FIDELITY, SURETY 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1994 XXX XXX XXX XXX XXX XXX 03 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4K - FIDELITY, SURETY 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR XXX 2,131 5,533 -410 02 1994 XXX XXX 3,597 -276 03 1995 XXX XXX XXX 9,187 SCHEDULE P - PART 4L - OTHER (INCLUDING CREDIT, ACCIDENT AND HEALTH) 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1994 XXX XXX XXX XXX XXX XXX 03 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4L - OTHER (INCLUDING CREDIT, ACCIDENT AND HEALTH) 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR XXX 1,305 1,387 582 02 1994 XXX XXX 2,027 1,442 03 1995 XXX XXX XXX 5,361 SCHEDULE P - PART 4M - INTERNATIONAL 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 158 27 32 34 44 50 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4M - INTERNATIONAL 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR 456 852 1,334 1,315 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 0 11 1995 XXX XXX XXX 0 SCHEDULE P - PART 4N - REINSURANCE A 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 1988 XXX XXX 0 0 0 0 02 1989 XXX XXX XXX 0 0 0 03 1990 XXX XXX XXX XXX 0 0 04 1991 XXX XXX XXX XXX XXX 0 05 1992 XXX XXX XXX XXX XXX XXX 06 1993 XXX XXX XXX XXX XXX XXX 07 1994 XXX XXX XXX XXX XXX XXX 08 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4N - REINSURANCE A 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 1988 0 0 0 0 02 1989 0 0 0 0 03 1990 0 0 0 0 04 1991 0 0 0 0 05 1992 0 0 0 0 06 1993 XXX 0 0 0 07 1994 XXX XXX 0 0 08 1995 XXX XXX XXX 0 SCHEDULE P - PART 4O - REINSURANCE B 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 1988 XXX XXX 0 0 0 0 02 1989 XXX XXX XXX 0 0 0 03 1990 XXX XXX XXX XXX 0 0 04 1991 XXX XXX XXX XXX XXX 0 05 1992 XXX XXX XXX XXX XXX XXX 06 1993 XXX XXX XXX XXX XXX XXX 07 1994 XXX XXX XXX XXX XXX XXX 08 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4O - REINSURANCE B 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 1988 0 0 0 0 02 1989 0 0 0 0 03 1990 0 0 0 0 04 1991 0 0 0 0 05 1992 0 0 0 0 06 1993 XXX 0 0 0 07 1994 XXX XXX 0 0 08 1995 XXX XXX XXX 0 SCHEDULE P - PART 4P - REINSURANCE C 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 1988 XXX XXX 0 0 0 0 02 1989 XXX XXX XXX 0 0 0 03 1990 XXX XXX XXX XXX 0 0 04 1991 XXX XXX XXX XXX XXX 0 05 1992 XXX XXX XXX XXX XXX XXX 06 1993 XXX XXX XXX XXX XXX XXX 07 1994 XXX XXX XXX XXX XXX XXX 08 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4P - REINSURANCE C 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 1988 0 0 0 0 02 1989 0 0 0 0 03 1990 0 0 0 0 04 1991 0 0 0 0 05 1992 0 0 0 0 06 1993 XXX 0 0 0 07 1994 XXX XXX 0 0 08 1995 XXX XXX XXX 0 SCHEDULE P - PART 4Q - REINSURANCE D 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 175 25 25 565 1,729 540 02 1986 1,655 2,612 2,769 1,057 1,045 1,071 03 1987 XXX 0 0 0 0 0 SCHEDULE P - PART 4Q - REINSURANCE D 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR 545 539 749 1,904 02 1986 1,002 1,498 1,498 178 03 1987 0 0 0 0 SCHEDULE P - PART 4R - SECTION 1 - PRODUCTS LIABILITY - OCCURRENCE 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 12,684 14,473 15,791 14,899 4,444 6,441 02 1986 45,659 42,728 37,037 27,561 15,634 9,568 03 1987 XXX 39,062 34,484 32,480 22,054 11,003 04 1988 XXX XXX 25,111 14,647 14,927 10,648 05 1989 XXX XXX XXX 13,002 8,764 8,599 06 1990 XXX XXX XXX XXX 9,729 12,355 07 1991 XXX XXX XXX XXX XXX 8,056 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4R - SECTION 1 - PRODUCTS LIABILITY - OCCURRENCE 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR 6,676 10,004 24,119 24,865 02 1986 6,498 3,492 3,366 2,780 03 1987 5,533 3,692 1,596 1,039 04 1988 4,921 4,153 4,393 1,148 05 1989 5,187 5,585 4,199 6,270 06 1990 10,206 10,268 7,511 6,801 07 1991 6,787 7,491 5,914 6,244 08 1992 3,278 5,249 3,713 3,832 09 1993 XXX 4,397 4,497 3,591 10 1994 XXX XXX 7,236 3,771 11 1995 XXX XXX XXX 10,948 SCHEDULE P - PART 4R - SECTION 2 - PRODUCTS LIABILITY - CLAIMS MADE 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR 145 102 6 21 13 5 02 1986 2,528 2,155 1,486 1,267 775 356 03 1987 XXX 10,458 6,147 6,541 6,777 4,838 04 1988 XXX XXX 5,831 6,511 6,247 6,059 05 1989 XXX XXX XXX 5,449 4,539 3,615 06 1990 XXX XXX XXX XXX 3,652 1,549 07 1991 XXX XXX XXX XXX XXX 4,740 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4R - SECTION 2 - PRODUCTS LIABILITY - CLAIMS MADE 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR 3 0 0 0 02 1986 194 0 0 0 03 1987 4,457 321 0 0 04 1988 5,873 1,065 0 0 05 1989 3,769 1,036 8 3 06 1990 1,552 502 31 8 07 1991 3,922 1,414 375 62 08 1992 2,768 1,056 108 40 09 1993 XXX 828 216 80 10 1994 XXX XXX 561 61 11 1995 XXX XXX XXX 394 SCHEDULE P - PART 4S - FINANCIAL GUARANTY/MORTGAGE GUARANTY 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 LOSSES WERE INCURRED 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1994 XXX XXX XXX XXX XXX XXX 03 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 4S - FINANCIAL GUARANTY/MORTGAGE GUARANTY 1 BULK & INCURRED BUT NOT REPORTED RESERVES ON LOSSES & ALLOCATED EXPENSES AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 LOSSES WERE INCURRED 01 PRIOR XXX 0 0 0 02 1994 XXX XXX 0 0 03 1995 XXX XXX XXX 0 SCHEDULE P - PART 5A - HOMEOWNERS/FARMOWNERS SECTION 1 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 1,882 1,858 1,850 02 1986 25,333 29,562 29,768 30,701 30,736 30,748 03 1987 XXX 17,305 21,149 22,191 22,265 22,285 04 1988 XXX XXX 15,928 20,968 21,140 21,187 05 1989 XXX XXX XXX 23,189 29,169 29,436 06 1990 XXX XXX XXX XXX 18,612 23,854 07 1991 XXX XXX XXX XXX XXX 22,485 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5A - HOMEOWNERS/FARMOWNERS SECTION 1 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 1,845 1,884 1,845 1,851 02 1986 30,756 30,762 30,765 30,765 03 1987 22,287 22,293 22,289 22,291 04 1988 21,205 21,220 21,228 21,232 05 1989 29,503 29,532 29,551 29,557 06 1990 24,094 24,183 24,213 24,222 07 1991 27,052 27,267 27,329 27,362 08 1992 16,948 21,100 21,309 21,355 09 1993 XXX 17,908 20,833 20,794 10 1994 XXX XXX 20,752 22,632 11 1995 XXX XXX XXX 17,418 SCHEDULE P - PART 5A - HOMEOWNERS/FARMOWNERS SECTION 2 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 10 288 139 85 55 33 02 1986 742 217 106 59 30 14 03 1987 XXX 662 134 66 31 17 04 1988 XXX XXX 670 125 67 37 05 1989 XXX XXX XXX 909 195 81 06 1990 XXX XXX XXX XXX 900 220 07 1991 XXX XXX XXX XXX XXX 676 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5A - HOMEOWNERS/FARMOWNERS SECTION 2 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 17 16 28 24 02 1986 9 6 1 1 03 1987 9 7 6 5 04 1988 23 10 7 1 05 1989 61 32 15 9 06 1990 113 48 21 11 07 1991 181 104 57 26 08 1992 586 192 77 50 09 1993 XXX 1,715 147 84 10 1994 XXX XXX 1,726 156 11 1995 XXX XXX XXX 1,818 SCHEDULE P - PART 5A - HOMEOWNERS/FARMOWNERS SECTION 3 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1986 26,234 30,219 30,366 31,269 31,599 31,607 03 1987 XXX 17,959 21,579 22,585 22,925 22,935 04 1988 XXX XXX 16,612 21,386 21,886 21,917 05 1989 XXX XXX XXX 24,292 30,475 30,667 06 1990 XXX XXX XXX XXX 20,493 25,355 07 1991 XXX XXX XXX XXX XXX 23,819 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5A - HOMEOWNERS/FARMOWNERS SECTION 3 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX 02 1986 31,614 31,618 31,620 31,621 03 1987 22,938 22,942 22,941 22,942 04 1988 21,940 21,945 21,955 21,954 05 1989 30,748 30,803 30,814 30,817 06 1990 25,549 25,595 25,612 25,617 07 1991 28,177 28,359 28,406 28,419 08 1992 18,097 22,066 22,250 22,271 09 1993 XXX 21,154 23,326 23,205 10 1994 XXX XXX 26,822 27,639 11 1995 XXX XXX XXX 22,483 SCHEDULE P - PART 5B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL SECTION 1 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 25,665 38,232 38,470 02 1986 38,835 53,011 54,919 61,011 61,260 61,586 03 1987 XXX 37,297 51,664 60,713 61,547 62,056 04 1988 XXX XXX 44,166 70,270 73,562 74,758 05 1989 XXX XXX XXX 70,340 99,382 104,255 06 1990 XXX XXX XXX XXX 82,557 116,189 07 1991 XXX XXX XXX XXX XXX 92,749 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL SECTION 1 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 40,070 38,209 39,035 39,041 02 1986 63,414 63,441 63,869 63,564 03 1987 63,817 63,873 64,428 64,142 04 1988 76,596 76,790 77,437 77,287 05 1989 106,998 107,608 108,328 107,039 06 1990 122,743 124,439 125,848 123,896 07 1991 129,562 135,171 136,867 135,203 08 1992 102,023 141,824 147,326 148,887 09 1993 XXX 120,706 163,194 180,607 10 1994 XXX XXX 149,840 226,757 11 1995 XXX XXX XXX 184,452 SCHEDULE P - PART 5B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL SECTION 2 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 375 1,425 763 558 384 129 02 1986 14,267 3,346 1,343 467 208 86 03 1987 XXX 16,044 3,830 1,394 617 246 04 1988 XXX XXX 17,371 4,898 1,899 731 05 1989 XXX XXX XXX 27,913 6,165 2,038 06 1990 XXX XXX XXX XXX 32,926 7,028 07 1991 XXX XXX XXX XXX XXX 32,588 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL SECTION 2 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 87 58 42 111 02 1986 58 25 13 6 03 1987 126 50 20 9 04 1988 328 125 42 24 05 1989 906 301 121 75 06 1990 2,483 943 325 169 07 1991 6,749 2,182 832 426 08 1992 34,445 7,161 2,231 1,150 09 1993 XXX 44,719 9,149 4,022 10 1994 XXX XXX 53,552 17,097 11 1995 XXX XXX XXX 78,228 SCHEDULE P - PART 5B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL SECTION 3 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1986 67,954 77,485 78,538 90,193 90,140 792,448 03 1987 XXX 67,706 77,922 92,671 93,047 93,431 04 1988 XXX XXX 79,432 107,827 109,116 109,745 05 1989 XXX XXX XXX 128,366 144,092 145,805 06 1990 XXX XXX XXX XXX 151,771 170,388 07 1991 XXX XXX XXX XXX XXX 164,930 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5B - PRIVATE PASSENGER AUTO LIABILITY/MEDICAL SECTION 3 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX 02 1986 92,493 92,532 93,160 92,766 03 1987 95,366 95,424 96,253 95,898 04 1988 111,590 111,682 112,606 112,468 05 1989 147,931 148,190 149,095 149,032 06 1990 173,712 174,344 175,791 175,824 07 1991 187,044 189,410 190,811 186,799 08 1992 181,028 206,832 209,100 202,947 09 1993 XXX 223,497 251,563 249,468 10 1994 XXX XXX 283,771 334,015 11 1995 XXX XXX XXX 341,995 SCHEDULE P - PART 5C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL SECTION 1 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 262 1,089 1,481 02 1986 9,950 12,971 13,478 13,790 13,918 14,922 03 1987 XXX 8,666 11,878 12,537 12,786 14,107 04 1988 XXX XXX 9,052 13,003 13,738 14,934 05 1989 XXX XXX XXX 10,368 13,991 15,354 06 1990 XXX XXX XXX XXX 8,940 12,400 07 1991 XXX XXX XXX XXX XXX 7,645 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL SECTION 1 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 1,495 1,141 1,345 1,354 02 1986 15,499 15,508 15,959 15,958 03 1987 14,782 14,893 15,550 15,389 04 1988 15,613 15,725 16,411 16,237 05 1989 16,214 16,415 17,003 17,009 06 1990 14,127 14,507 15,159 15,136 07 1991 11,284 11,950 13,121 13,141 08 1992 7,691 10,807 12,403 12,659 09 1993 XXX 8,774 13,698 14,654 10 1994 XXX XXX 10,830 15,724 11 1995 XXX XXX XXX 10,664 SCHEDULE P - PART 5C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL SECTION 2 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 29 1,729 892 669 272 143 02 1986 2,887 1,097 619 264 106 57 03 1987 XXX 2,767 1,020 442 223 133 04 1988 XXX XXX 3,602 1,195 526 307 05 1989 XXX XXX XXX 3,208 1,243 720 06 1990 XXX XXX XXX XXX 3,098 1,680 07 1991 XXX XXX XXX XXX XXX 3,342 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL SECTION 2 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 100 77 76 79 02 1986 27 12 2 1 03 1987 60 25 10 5 04 1988 124 56 32 17 05 1989 322 146 67 32 06 1990 780 301 123 72 07 1991 1,512 622 300 145 08 1992 3,605 1,229 603 357 09 1993 XXX 4,256 1,838 954 10 1994 XXX XXX 5,035 2,149 11 1995 XXX XXX XXX 4,908 SCHEDULE P - PART 5C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL SECTION 3 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1986 15,041 17,483 17,752 17,877 17,890 19,353 03 1987 XXX 13,777 16,393 16,716 16,789 18,636 04 1988 XXX XXX 15,805 18,437 18,712 20,252 05 1989 XXX XXX XXX 16,487 19,048 20,491 06 1990 XXX XXX XXX XXX 14,309 17,938 07 1991 XXX XXX XXX XXX XXX 12,899 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL SECTION 3 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX 02 1986 19,995 20,002 20,659 20,671 03 1987 19,355 19,377 20,336 20,132 04 1988 20,889 20,907 21,883 21,642 05 1989 21,093 21,147 21,929 21,937 06 1990 19,052 19,013 19,467 19,384 07 1991 15,708 15,620 17,062 17,004 08 1992 13,307 15,090 16,853 16,988 09 1993 XXX 16,144 21,068 21,495 10 1994 XXX XXX 20,773 25,294 11 1995 XXX XXX XXX 19,580 SCHEDULE P - PART 5D - WORKERS' COMPENSATION SECTION 1 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 844 951 2,161 02 1986 31,780 41,440 42,454 71,668 72,635 73,143 03 1987 XXX 25,727 35,835 66,401 68,015 68,951 04 1988 XXX XXX 26,809 62,637 65,075 66,792 05 1989 XXX XXX XXX 43,673 59,642 62,482 06 1990 XXX XXX XXX XXX 43,840 58,072 07 1991 XXX XXX XXX XXX XXX 37,560 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5D - WORKERS' COMPENSATION SECTION 1 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 2,302 2,578 2,843 3,136 02 1986 73,423 73,564 73,681 73,757 03 1987 69,489 69,764 69,965 70,066 04 1988 67,664 68,104 68,455 68,638 05 1989 64,283 65,101 65,651 65,960 06 1990 61,462 63,494 64,593 65,222 07 1991 50,821 54,068 56,225 57,411 08 1992 37,104 50,024 52,981 54,629 09 1993 XXX 35,425 47,805 50,004 10 1994 XXX XXX 38,068 51,189 11 1995 XXX XXX XXX 35,216 SCHEDULE P - PART 5D - WORKERS' COMPENSATION SECTION 2 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 813 10,345 7,647 5,439 4,861 3,385 02 1986 13,484 6,057 3,823 2,336 1,383 826 03 1987 XXX 15,460 6,242 4,015 2,424 1,412 04 1988 XXX XXX 15,786 6,462 4,222 2,348 05 1989 XXX XXX XXX 14,834 6,529 3,803 06 1990 XXX XXX XXX XXX 15,449 7,537 07 1991 XXX XXX XXX XXX XXX 15,334 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5D - WORKERS' COMPENSATION SECTION 2 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 2,844 2,604 2,328 1,771 02 1986 504 356 281 211 03 1987 808 545 382 292 04 1988 1,347 916 560 393 05 1989 2,094 1,305 810 514 06 1990 4,517 2,566 1,514 914 07 1991 7,819 4,728 2,673 1,515 08 1992 14,288 6,152 3,572 1,947 09 1993 XXX 13,730 5,049 3,003 10 1994 XXX XXX 14,349 5,667 11 1995 XXX XXX XXX 12,146 SCHEDULE P - PART 5D - WORKERS' COMPENSATION SECTION 3 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1986 39,766 48,229 48,664 81,529 81,675 81,754 03 1987 XXX 33,394 43,351 78,673 78,970 79,097 04 1988 XXX XXX 36,313 77,102 77,798 78,025 05 1989 XXX XXX XXX 60,674 69,432 70,041 06 1990 XXX XXX XXX XXX 62,857 70,258 07 1991 XXX XXX XXX XXX XXX 55,714 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5D - WORKERS' COMPENSATION SECTION 3 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX 02 1986 81,714 81,738 81,828 81,845 03 1987 79,061 79,112 79,234 79,264 04 1988 78,078 78,153 78,238 78,268 05 1989 70,252 70,363 70,478 70,516 06 1990 70,879 71,112 71,260 71,325 07 1991 62,576 63,100 63,372 63,463 08 1992 54,006 59,951 60,524 60,679 09 1993 XXX 51,920 56,504 56,841 10 1994 XXX XXX 55,541 61,114 11 1995 XXX XXX XXX 50,331 SCHEDULE P - PART 5E - COMMERICAL MULTIPLE PERIL SECTION 1 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 6 0 0 1,967 2,074 2,136 02 1986 7,892 10,941 11,498 11,834 12,004 12,099 03 1987 XXX 6,661 9,931 10,502 10,758 10,936 04 1988 XXX XXX 7,745 11,116 11,671 11,928 05 1989 XXX XXX XXX 8,378 12,527 13,117 06 1990 XXX XXX XXX XXX 8,650 12,603 07 1991 XXX XXX XXX XXX XXX 8,593 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5E - COMMERICAL MULTIPLE PERIL SECTION 1 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 2,220 2,245 3,114 3,123 02 1986 12,158 12,196 12,751 12,247 03 1987 11,049 11,093 11,572 11,133 04 1988 12,090 12,190 12,671 12,284 05 1989 13,422 13,589 14,339 13,784 06 1990 13,216 13,513 14,119 13,856 07 1991 11,972 12,591 13,309 13,191 08 1992 7,080 10,403 11,262 11,342 09 1993 XXX 7,224 10,169 10,675 10 1994 XXX XXX 8,431 11,637 11 1995 XXX XXX XXX 7,728 SCHEDULE P - PART 5E - COMMERICAL MULTIPLE PERIL SECTION 2 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 25 2,015 1,293 882 559 423 02 1986 1,580 877 602 377 226 135 03 1987 XXX 1,383 806 542 364 200 04 1988 XXX XXX 1,587 780 555 388 05 1989 XXX XXX XXX 1,521 968 639 06 1990 XXX XXX XXX XXX 1,974 1,055 07 1991 XXX XXX XXX XXX XXX 1,712 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5E - COMMERICAL MULTIPLE PERIL SECTION 2 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 297 225 182 152 02 1986 90 66 48 37 03 1987 108 71 39 38 04 1988 245 141 71 58 05 1989 442 299 170 97 06 1990 682 419 232 180 07 1991 1,113 704 451 281 08 1992 1,628 1,036 694 500 09 1993 XXX 1,859 1,153 786 10 1994 XXX XXX 2,634 1,617 11 1995 XXX XXX XXX 3,145 SCHEDULE P - PART 5E - COMMERICAL MULTIPLE PERIL SECTION 3 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1986 10,100 13,191 13,692 13,932 14,055 14,116 03 1987 XXX 8,562 11,932 12,453 12,365 12,775 04 1988 XXX XXX 10,075 13,441 13,944 14,188 05 1989 XXX XXX XXX 10,628 15,021 15,572 06 1990 XXX XXX XXX XXX 11,401 15,431 07 1991 XXX XXX XXX XXX XXX 11,079 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5E - COMMERICAL MULTIPLE PERIL SECTION 3 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX 02 1986 14,169 14,227 14,829 14,293 03 1987 12,845 12,892 13,433 12,970 04 1988 14,291 14,360 14,870 14,442 05 1989 15,844 15,958 16,705 16,052 06 1990 16,064 16,281 16,871 16,555 07 1991 15,042 15,597 16,285 16,057 08 1992 9,743 13,825 14,710 14,720 09 1993 XXX 10,337 14,084 14,537 10 1994 XXX XXX 12,757 16,714 11 1995 XXX XXX XXX 12,860 SCHEDULE P - PART 5F - MEDICAL MALPRACTICE - OCCURRENCE SECTION 1A 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5F - MEDICAL MALPRACTICE - OCCURRENCE SECTION 1A 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 0 11 1995 XXX XXX XXX 0 SCHEDULE P - PART 5F - MEDICAL MALPRACTICE - CLAIMS MADE SECTION 1B 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5F - MEDICAL MALPRACTICE - CLAIMS MADE SECTION 1B 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 1 11 1995 XXX XXX XXX 2 SCHEDULE P - PART 5F - MEDICAL MALPRACTICE - OCCURRENCE SECTION 2A 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 2 7 7 6 6 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5F - MEDICAL MALPRACTICE - OCCURRENCE SECTION 2A 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 3 3 1 107 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 0 11 1995 XXX XXX XXX 0 SCHEDULE P - PART 5F - MEDICAL MALPRACTICE - CLAIMS MADE SECTION 2B 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5F - MEDICAL MALPRACTICE - CLAIMS MADE SECTION 2B 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 2 6 11 1995 XXX XXX XXX 8 SCHEDULE P - PART 5F - MEDICAL MALPRACTICE - OCCURRENCE SECTION 3A 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5F - MEDICAL MALPRACTICE - OCCURRENCE SECTION 3A 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 0 11 1995 XXX XXX XXX 0 SCHEDULE P - PART 5F - MEDICAL MALPRACTICE - CLAIMS MADE SECTION 3B 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5F - MEDICAL MALPRACTICE - CLAIMS MADE SECTION 3B 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 2 7 11 1995 XXX XXX XXX 11 SCHEDULE P - PART 5H - OTHER LIABILITY - OCCURRENCE SECTION 1A 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 4 0 0 4,452 4,647 4,748 02 1986 3,301 5,248 5,931 6,309 6,492 6,606 03 1987 XXX 2,612 4,309 4,829 5,154 5,194 04 1988 XXX XXX 2,181 3,263 3,632 3,801 05 1989 XXX XXX XXX 2,104 3,079 3,305 06 1990 XXX XXX XXX XXX 1,596 2,613 07 1991 XXX XXX XXX XXX XXX 1,435 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5H - OTHER LIABILITY - OCCURRENCE SECTION 1A 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 4,848 4,936 4,908 4,932 02 1986 6,672 6,703 6,666 6,702 03 1987 5,279 5,408 5,426 5,461 04 1988 3,922 4,036 4,073 4,086 05 1989 3,491 3,634 3,692 3,707 06 1990 2,848 3,046 3,158 3,177 07 1991 2,395 2,810 2,991 3,038 08 1992 2,232 3,743 4,080 4,184 09 1993 XXX 1,861 2,917 3,943 10 1994 XXX XXX 1,535 3,395 11 1995 XXX XXX XXX 1,055 SCHEDULE P - PART 5H - OTHER LIABILITY - CLAIMS MADE SECTION 1B 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 10 12 12 02 1986 6 20 31 37 38 40 03 1987 XXX 36 64 89 100 177 04 1988 XXX XXX 47 80 90 129 05 1989 XXX XXX XXX 40 53 83 06 1990 XXX XXX XXX XXX 32 50 07 1991 XXX XXX XXX XXX XXX 52 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5H - OTHER LIABILITY - CLAIMS MADE SECTION 1B 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 12 12 12 12 02 1986 42 42 42 42 03 1987 172 174 249 192 04 1988 125 126 140 113 05 1989 84 87 112 88 06 1990 69 77 86 113 07 1991 121 144 104 124 08 1992 109 39 65 108 09 1993 XXX 14 64 148 10 1994 XXX XXX 38 93 11 1995 XXX XXX XXX 31 SCHEDULE P - PART 5H - OTHER LIABILITY - OCCURRENCE SECTION 2A 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 1,603 3,244 3,003 2,156 1,821 1,766 02 1986 2,126 1,284 921 619 406 263 03 1987 XXX 1,473 1,010 639 472 298 04 1988 XXX XXX 1,049 707 563 400 05 1989 XXX XXX XXX 826 622 536 06 1990 XXX XXX XXX XXX 711 569 07 1991 XXX XXX XXX XXX XXX 559 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5H - OTHER LIABILITY - OCCURRENCE SECTION 2A 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 2,005 2,137 2,338 3,441 02 1986 197 158 158 140 03 1987 204 148 120 84 04 1988 255 141 104 75 05 1989 373 221 144 88 06 1990 446 313 250 127 07 1991 530 450 298 164 08 1992 674 553 407 316 09 1993 XXX 992 670 1,496 10 1994 XXX XXX 998 3,315 11 1995 XXX XXX XXX 1,588 SCHEDULE P - PART 5H - OTHER LIABILITY - CLAIMS MADE SECTION 2B 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 4 5 3 1 0 0 02 1986 39 21 12 7 5 2 03 1987 XXX 135 73 30 19 13 04 1988 XXX XXX 111 55 45 29 05 1989 XXX XXX XXX 147 94 58 06 1990 XXX XXX XXX XXX 202 143 07 1991 XXX XXX XXX XXX XXX 337 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5H - OTHER LIABILITY - CLAIMS MADE SECTION 2B 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 1 1 0 03 1987 9 4 3 3 04 1988 15 9 6 2 05 1989 21 12 13 8 06 1990 112 89 55 37 07 1991 174 118 97 60 08 1992 221 212 148 88 09 1993 XXX 277 247 147 10 1994 XXX XXX 589 274 11 1995 XXX XXX XXX 808 SCHEDULE P - PART 5H - OTHER LIABILITY - OCCURRENCE SECTION 3A 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1986 7,056 9,813 10,572 10,873 11,425 11,407 03 1987 XXX 5,204 7,281 7,815 8,314 8,277 04 1988 XXX XXX 4,218 5,619 6,168 6,336 05 1989 XXX XXX XXX 3,372 4,677 4,998 06 1990 XXX XXX XXX XXX 2,725 4,030 07 1991 XXX XXX XXX XXX XXX 2,385 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5H - OTHER LIABILITY - OCCURRENCE SECTION 3A 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX 02 1986 11,449 11,509 11,498 11,564 03 1987 8,351 8,544 8,709 8,634 04 1988 6,440 6,569 6,753 6,654 05 1989 5,188 5,308 5,485 5,403 06 1990 4,384 4,639 4,978 4,832 07 1991 3,685 4,287 4,721 4,563 08 1992 3,147 5,177 5,868 5,886 09 1993 XXX 3,001 4,882 6,851 10 1994 XXX XXX 3,650 8,342 11 1995 XXX XXX XXX 3,446 SCHEDULE P - PART 5H - OTHER LIABILITY - CLAIMS MADE SECTION 3B 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1986 62 91 94 99 100 100 03 1987 XXX 182 232 247 251 346 04 1988 XXX XXX 172 224 236 296 05 1989 XXX XXX XXX 191 237 272 06 1990 XXX XXX XXX XXX 244 343 07 1991 XXX XXX XXX XXX XXX 424 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5H - OTHER LIABILITY - CLAIMS MADE SECTION 3B 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX 02 1986 101 102 104 104 03 1987 327 327 459 446 04 1988 277 277 298 284 05 1989 237 237 285 264 06 1990 345 354 352 349 07 1991 506 515 476 478 08 1992 582 643 427 442 09 1993 XXX 325 556 580 10 1994 XXX XXX 661 690 11 1995 XXX XXX XXX 842 SCHEDULE P - PART 5R - PRODUCTS LIABILITY - OCCURRENCE SECTION 1A 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 206 233 297 02 1986 140 241 279 295 329 373 03 1987 XXX 98 161 189 154 226 04 1988 XXX XXX 51 77 39 110 05 1989 XXX XXX XXX 36 21 73 06 1990 XXX XXX XXX XXX 45 107 07 1991 XXX XXX XXX XXX XXX 62 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5R - PRODUCTS LIABILITY - OCCURRENCE SECTION 1A 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 308 298 351 359 02 1986 390 376 381 391 03 1987 227 233 226 266 04 1988 136 133 178 173 05 1989 77 87 106 127 06 1990 119 130 167 218 07 1991 100 121 144 223 08 1992 76 118 141 162 09 1993 XXX 111 163 206 10 1994 XXX XXX 90 164 11 1995 XXX XXX XXX 138 SCHEDULE P - PART 5R - PRODUCTS LIABILITY - CLAIMS MADE SECTION 1B 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 2 2 2 2 2 03 1987 XXX 27 32 45 57 59 04 1988 XXX XXX 23 39 60 69 05 1989 XXX XXX XXX 42 61 65 06 1990 XXX XXX XXX XXX 21 33 07 1991 XXX XXX XXX XXX XXX 26 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5R - PRODUCTS LIABILITY - CLAIMS MADE SECTION 1B 1 CUMULATIVE NO OF CLAIMS CLOSED WITH LOSS PAYMENT DIRECT & ASSUMED YR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 2 2 2 2 03 1987 77 80 83 120 04 1988 63 69 71 75 05 1989 91 92 98 118 06 1990 57 61 58 53 07 1991 263 271 300 278 08 1992 25 33 38 49 09 1993 XXX 19 21 34 10 1994 XXX XXX 15 47 11 1995 XXX XXX XXX 17 SCHEDULE P - PART 5R - PRODUCTS LIABILITY - OCCURRENCE SECTION 2A 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 143 342 227 1,107 1,003 1,140 02 1986 151 123 89 130 94 164 03 1987 XXX 73 52 88 62 103 04 1988 XXX XXX 11 53 49 94 05 1989 XXX XXX XXX 38 45 64 06 1990 XXX XXX XXX XXX 38 85 07 1991 XXX XXX XXX XXX XXX 41 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5R - PRODUCTS LIABILITY - OCCURRENCE SECTION 2A 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 1,135 1,043 994 913 02 1986 151 98 95 66 03 1987 91 60 76 53 04 1988 74 44 43 40 05 1989 65 30 27 32 06 1990 94 53 56 41 07 1991 50 40 43 23 08 1992 26 43 62 46 09 1993 XXX 30 63 35 10 1994 XXX XXX 75 38 11 1995 XXX XXX XXX 47 SCHEDULE P - PART 5R - PRODUCTS LIABILITY - CLAIMS MADE SECTION 2B 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 3 2 2 1 1 0 03 1987 XXX 12 29 21 13 11 04 1988 XXX XXX 18 42 28 19 05 1989 XXX XXX XXX 28 17 25 06 1990 XXX XXX XXX XXX 17 29 07 1991 XXX XXX XXX XXX XXX 30 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5R - PRODUCTS LIABILITY - CLAIMS MADE SECTION 2B 1 NUMBER OF CLAIMS OUTSTANDING DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 10 4 3 3 04 1988 8 2 2 2 05 1989 2 1 2 0 06 1990 11 4 1 1 07 1991 58 40 20 11 08 1992 31 16 8 8 09 1993 XXX 34 16 10 10 1994 XXX XXX 31 30 11 1995 XXX XXX XXX 23 SCHEDULE P - PART 5R - PRODUCTS LIABILITY - OCCURRENCE SECTION 3A 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1986 376 606 662 758 803 1,336 03 1987 XXX 257 386 481 408 796 04 1988 XXX XXX 127 207 151 446 05 1989 XXX XXX XXX 133 70 275 06 1990 XXX XXX XXX XXX 98 287 07 1991 XXX XXX XXX XXX XXX 124 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5R - PRODUCTS LIABILITY - OCCURRENCE SECTION 3A 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX 02 1986 1,381 1,051 1,116 1,141 03 1987 823 629 714 728 04 1988 468 325 434 400 05 1989 258 218 462 277 06 1990 353 267 495 370 07 1991 208 215 534 367 08 1992 118 198 487 280 09 1993 XXX 166 491 306 10 1994 XXX XXX 243 255 11 1995 XXX XXX XXX 217 SCHEDULE P - PART 5R - PRODUCTS LIABILITY - CLAIMS MADE SECTION 3B 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX XXX XXX 02 1986 4 11 11 12 12 12 03 1987 XXX 46 85 109 127 130 04 1988 XXX XXX 46 99 116 124 05 1989 XXX XXX XXX 76 119 131 06 1990 XXX XXX XXX XXX 41 99 07 1991 XXX XXX XXX XXX XXX 62 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 5R - PRODUCTS LIABILITY - CLAIMS MADE SECTION 3B 1 CUMULATIVE NUMBER OF CLAIMS REPORTED DIRECT AND ASSUMED AT YEAR END YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR XXX XXX XXX XXX 02 1986 12 12 12 12 03 1987 133 134 136 176 04 1988 121 122 127 127 05 1989 169 169 177 180 06 1990 95 95 88 91 07 1991 372 372 387 340 08 1992 74 78 87 83 09 1993 XXX 66 75 58 10 1994 XXX XXX 66 86 11 1995 XXX XXX XXX 42 SCHEDULE P - PART 6C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL SECTION 1 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL SECTION 1 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 171,139 188,272 189,583 10 1994 XXX XXX 178,461 193,246 11 1995 XXX XXX XXX 177,173 SCHEDULE P - PART 6C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL SECTION 2 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6C - COMMERCIAL AUTO/TRUCK LIABILITY/MEDICAL SECTION 2 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 60,086 68,032 65,088 10 1994 XXX XXX 59,289 66,604 11 1995 XXX XXX XXX 48,696 SCHEDULE P - PART 6D - WORKERS' COMPENSATION SECTION 1 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6D - WORKERS' COMPENSATION SECTION 1 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 603,250 614,008 614,005 10 1994 XXX XXX 627,994 636,343 11 1995 XXX XXX XXX 493,870 SCHEDULE P - PART 6D - WORKERS' COMPENSATION SECTION 2 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6D - WORKERS' COMPENSATION SECTION 2 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 36,911 46,897 46,055 10 1994 XXX XXX 30,094 29,638 11 1995 XXX XXX XXX 25,001 SCHEDULE P - PART 6E - COMMERICAL MULTIPLE PERIL SECTION 1 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6E - COMMERICAL MULTIPLE PERIL SECTION 1 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 191,351 195,366 195,138 10 1994 XXX XXX 213,075 219,695 11 1995 XXX XXX XXX 248,635 SCHEDULE P - PART 6E - COMMERICAL MULTIPLE PERIL SECTION 2 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6E - COMMERICAL MULTIPLE PERIL SECTION 2 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 20,074 28,049 26,170 10 1994 XXX XXX 28,970 38,415 11 1995 XXX XXX XXX 49,796 SCHEDULE P - PART 6H - OTHER LIABILITY - OCCURRENCE SECTION 1A 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6H - OTHER LIABILITY - OCCURRENCE SECTION 1A 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 204,253 231,865 228,924 10 1994 XXX XXX 224,278 249,941 11 1995 XXX XXX XXX 368,653 SCHEDULE P - PART 6H - OTHER LIABILITY - CLAIMS MADE SECTION 1B 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6H - OTHER LIABILITY - CLAIMS MADE SECTION 1B 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 88,906 92,678 87,862 10 1994 XXX XXX 97,423 99,965 11 1995 XXX XXX XXX 18,515 SCHEDULE P - PART 6H - OTHER LIABILITY - OCCURRENCE SECTION 2A 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6H - OTHER LIABILITY - OCCURRENCE SECTION 2A 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 91,624 108,550 103,115 10 1994 XXX XXX 97,357 115,729 11 1995 XXX XXX XXX 144,745 SCHEDULE P - PART 6H - OTHER LIABILITY - CLAIMS MADE SECTION 2B 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6H - OTHER LIABILITY - CLAIMS MADE SECTION 2B 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 5,235 6,564 6,602 10 1994 XXX XXX 6,289 7,330 11 1995 XXX XXX XXX 1,933 SCHEDULE P - PART 6M - INTERNATIONAL SECTION 1 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6M - INTERNATIONAL SECTION 1 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 0 11 1995 XXX XXX XXX 0 SCHEDULE P - PART 6M - INTERNATIONAL SECTION 2 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6M - INTERNATIONAL SECTION 2 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 0 11 1995 XXX XXX XXX 0 SCHEDULE P - PART 6N - REINSURANCE A SECTION 1 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 1988 XXX XXX 0 0 0 0 02 1989 XXX XXX XXX 0 0 0 03 1990 XXX XXX XXX XXX 0 0 04 1991 XXX XXX XXX XXX XXX 0 05 1992 XXX XXX XXX XXX XXX XXX 06 1993 XXX XXX XXX XXX XXX XXX 07 1994 XXX XXX XXX XXX XXX XXX 08 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6N - REINSURANCE A SECTION 1 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 1988 0 0 0 0 02 1989 0 0 0 0 03 1990 0 0 0 0 04 1991 0 0 0 0 05 1992 0 0 0 0 06 1993 XXX 0 0 0 07 1994 XXX XXX 0 0 08 1995 XXX XXX XXX 0 SCHEDULE P - PART 6N - REINSURANCE A SECTION 2 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 1988 XXX XXX 0 0 0 0 02 1989 XXX XXX XXX 0 0 0 03 1990 XXX XXX XXX XXX 0 0 04 1991 XXX XXX XXX XXX XXX 0 05 1992 XXX XXX XXX XXX XXX XXX 06 1993 XXX XXX XXX XXX XXX XXX 07 1994 XXX XXX XXX XXX XXX XXX 08 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6N - REINSURANCE A SECTION 2 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 1988 0 0 0 0 02 1989 0 0 0 0 03 1990 0 0 0 0 04 1991 0 0 0 0 05 1992 0 0 0 0 06 1993 XXX 0 0 0 07 1994 XXX XXX 0 0 08 1995 XXX XXX XXX 0 SCHEDULE P - PART 6O - REINSURANCE B SECTION 1 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 1988 XXX XXX 0 0 0 0 02 1989 XXX XXX XXX 0 0 0 03 1990 XXX XXX XXX XXX 0 0 04 1991 XXX XXX XXX XXX XXX 0 05 1992 XXX XXX XXX XXX XXX XXX 06 1993 XXX XXX XXX XXX XXX XXX 07 1994 XXX XXX XXX XXX XXX XXX 08 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6O - REINSURANCE B SECTION 1 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 1988 0 0 0 0 02 1989 0 0 0 0 03 1990 0 0 0 0 04 1991 0 0 0 0 05 1992 0 0 0 0 06 1993 XXX 0 0 0 07 1994 XXX XXX 0 0 08 1995 XXX XXX XXX 0 SCHEDULE P - PART 6O - REINSURANCE B SECTION 2 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 1988 XXX XXX 0 0 0 0 02 1989 XXX XXX XXX 0 0 0 03 1990 XXX XXX XXX XXX 0 0 04 1991 XXX XXX XXX XXX XXX 0 05 1992 XXX XXX XXX XXX XXX XXX 06 1993 XXX XXX XXX XXX XXX XXX 07 1994 XXX XXX XXX XXX XXX XXX 08 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6O - REINSURANCE B SECTION 2 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 1988 0 0 0 0 02 1989 0 0 0 0 03 1990 0 0 0 0 04 1991 0 0 0 0 05 1992 0 0 0 0 06 1993 XXX 0 0 0 07 1994 XXX XXX 0 0 08 1995 XXX XXX XXX 0 SCHEDULE P - PART 6R - PRODUCTS LIABILITY - OCCURRENCE SECTION 1A 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6R - PRODUCTS LIABILITY - OCCURRENCE SECTION 1A 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 8,940 10,901 15,806 10 1994 XXX XXX 9,806 11,773 11 1995 XXX XXX XXX 14,231 SCHEDULE P - PART 6R - PRODUCTS LIABILITY - CLAIMS MADE SECTION 1B 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6R - PRODUCTS LIABILITY - CLAIMS MADE SECTION 1B 1 CUMULATIVE PREMIUMS EARNED DIRECT AND ASSUMED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 1,881 1,862 1,862 10 1994 XXX XXX 1,769 1,773 11 1995 XXX XXX XXX 499 SCHEDULE P - PART 6R - PRODUCTS LIABILITY - OCCURRENCE SECTION 2A 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6R - PRODUCTS LIABILITY - OCCURRENCE SECTION 2A 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 3,587 4,515 6,880 10 1994 XXX XXX 2,862 3,548 11 1995 XXX XXX XXX 5,128 SCHEDULE P - PART 6R - PRODUCTS LIABILITY - CLAIMS MADE SECTION 2B 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 6R - PRODUCTS LIABILITY - CLAIMS MADE SECTION 2B 1 CUMULATIVE PREMIUMS EARNED CEDED AT YEAR END (000 OMITTED) YEARS 8 9 10 11 12 13 IN WHICH 1992 1993 1994 1995 PREMS WERE EARNED & LOSSES INC 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 1,335 1,313 1,313 10 1994 XXX XXX 1,732 1,734 11 1995 XXX XXX XXX 490 SCHEDULE P - PART 7A - PRIMARY LOSS SENSITIVE CONTRACTS 1 2 3 4 5 6 7 TOTAL NET LOSSES LOSS NET PREMIUMS LOSS SCH P NET LOSSES & EXPENSES SENSITIVE TOTAL NET WRITTEN ON SENSITIVE PART & EXPENSES UNPAID ON AS PREMIUMS LOSS AS 1 UNPAID LOSS SENSITI PERCENTAGE WRITTEN SENSITIVE PERCENTAGE CONTRACTS OF TOTAL CONTRACTS OF TOTAL 01 30,214 0 .000 90,804 0 .000 02 705,207 0 .000 1,013,342 0 .000 03 201,972 1,031 .030 135,367 1,275 .042 04 959,825 22,979 .675 455,687 35,599 1.160 05 309,785 329 .010 217,108 115 .004 06 3,525 0 .000 0 0 .000 07 1,289 0 .000 765 0 .000 08 40,018 0 .000 56,706 0 .000 09 606,871 4,872 .143 145,633 1,831 .060 10 229,084 0 .000 141,281 0 .000 11 131,319 0 .000 247,198 0 .000 12 51,434 80 .002 508,602 245 .008 13 16,645 0 .000 36,260 0 .000 14 7,904 0 .000 8,750 0 .000 15 3,934 0 .000 1 0 .000 16 XXX XXX XXX XXX XXX XXX 17 XXX XXX XXX XXX XXX XXX 18 XXX XXX XXX XXX XXX XXX 19 XXX XXX XXX XXX XXX XXX 20 101,293 1,652 .049 10,281 237 .008 21 2,376 0 .000 1,471 0 .000 22 0 0 .000 0 0 .000 23 3,402,695 30,943 .909 3,069,256 39,302 1.282 SCHEDULE P - PART 7A - PRIMARY LOSS SENSITIVE CONTRACTS SECTION 2 1 INCURRED LOSSES & ALLOCATED EXPENSES REPORTED AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 7A - PRIMARY LOSS SENSITIVE CONTRACTS SECTION 2 1 INCURRED LOSSES & ALLOCATED EXPENSES REPORTED AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 POLICIES WERE ISSUED 01 PRIOR 0 12,674 9,999 10,029 02 1986 0 36,772 37,017 37,353 03 1987 0 44,028 44,462 45,234 04 1988 0 30,266 30,673 30,729 05 1989 0 23,478 23,883 23,903 06 1990 0 12,571 12,608 13,105 07 1991 0 12,698 14,615 15,233 08 1992 0 12,103 13,808 15,044 09 1993 XXX 3,915 11,295 13,720 10 1994 XXX XXX 5,929 12,587 11 1995 XXX XXX XXX 6,418 SCHEDULE P - PART 7A - PRIMARY LOSS SENSITIVE CONTRACTS SECTION 3 1 BULK & IBNR RESERVES FOR LOSSES & ALLOC EXPENSE AT YR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 7A - PRIMARY LOSS SENSITIVE CONTRACTS SECTION 3 1 BULK & IBNR RESERVES FOR LOSSES & ALLOC EXPENSE AT YR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 0 11 1995 XXX XXX XXX 0 SCHEDULE P - PART 7A - PRIMARY LOSS SENSITIVE CONTRACTS SECTION 4 1 NET EARNED PREMIUMS REPORTED AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 7A - PRIMARY LOSS SENSITIVE CONTRACTS SECTION 4 1 NET EARNED PREMIUMS REPORTED AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 02 1986 0 33,232 33,125 33,062 03 1987 0 39,284 39,118 39,043 04 1988 0 35,234 35,280 35,382 05 1989 0 34,797 35,131 35,621 06 1990 0 24,920 25,596 25,708 07 1991 0 31,663 33,070 34,414 08 1992 0 39,765 35,907 37,127 09 1993 XXX 33,459 31,199 25,534 10 1994 XXX XXX 43,817 37,579 11 1995 XXX XXX XXX 31,172 SCHEDULE P - PART 7A - PRIMARY LOSS SENSITIVE CONTRACTS SECTION 5 1 NET RESERVE FOR PREMIUM ADJMNTS & ACCRUED RETRO PREMIUMS ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 7A - PRIMARY LOSS SENSITIVE CONTRACTS SECTION 5 1 NET RESERVE FOR PREMIUM ADJMNTS & ACCRUED RETRO PREMIUMS ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 02 1986 0 62 0 0 03 1987 0 65 418 0 04 1988 0 234 484 137 05 1989 0 194 202 200 06 1990 0 272 304 71 07 1991 0 67 571 604 08 1992 0 2,606 223 514 09 1993 XXX 481 3,953 488 10 1994 XXX XXX 0 5,938 11 1995 XXX XXX XXX 0 SCHEDULE P - PART 7B - REINSURANCE LOSS SENSITIVE CONTRACTS 1 2 3 4 5 6 7 TOTAL NET LOSSES LOSS NET PREMIUMS LOSS SCH P NET LOSSES & EXPENSES SENSITIVE TOTAL NET WRITTEN ON SENSITIVE PART & EXPENSES UNPAID ON AS PREMIUMS LOSS AS 1 UNPAID LOSS SENSITI PERCENTAGE WRITTEN SENSITIVE PERCENTAGE CONTRACTS OF TOTAL CONTRACTS OF TOTAL 01 169 0 .000 654 0 .000 02 7,414 0 .000 10,117 0 .000 03 16,904 0 .000 19,546 0 .000 04 13,302 0 .000 0 0 .000 05 1,160 0 .000 5,981 0 .000 06 0 0 .000 0 0 .000 07 0 0 .000 0 0 .000 08 0 0 .000 0 0 .000 09 18,972 0 .000 24,393 0 .000 10 0 0 .000 0 0 .000 11 603 0 .000 3,777 0 .000 12 875 0 .000 11,483 0 .000 13 109 0 .000 4,170 0 .000 14 0 0 .000 0 0 .000 15 0 0 .000 0 0 .000 16 0 0 .000 0 0 .000 17 0 0 .000 0 0 .000 18 0 0 .000 0 0 .000 19 0 0 .000 XXX XXX XXX 20 1,687 0 .000 4,201 0 .000 21 0 0 .000 0 0 .000 22 0 0 .000 0 0 .000 23 61,195 0 .000 84,322 0 .000 SCHEDULE P - PART 7B - REINSURANCE LOSS SENSITIVE CONTRACTS SECTION 2 1 INCURRED LOSSES & ALLOCATED EXPENSES REPORTED AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 7B - REINSURANCE LOSS SENSITIVE CONTRACTS SECTION 2 1 INCURRED LOSSES & ALLOCATED EXPENSES REPORTED AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 0 11 1995 XXX XXX XXX 0 SCHEDULE P - PART 7B - REINSURANCE LOSS SENSITIVE CONTRACTS SECTION 3 1 BULK & IBNR RESERVES FOR LOSSES & ALLOC EXPENSE AT YR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 7B - REINSURANCE LOSS SENSITIVE CONTRACTS SECTION 3 1 BULK & IBNR RESERVES FOR LOSSES & ALLOC EXPENSE AT YR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 0 11 1995 XXX XXX XXX 0 SCHEDULE P - PART 7B - REINSURANCE LOSS SENSITIVE CONTRACTS SECTION 4 1 NET EARNED PREMIUMS REPORTED AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 7B - REINSURANCE LOSS SENSITIVE CONTRACTS SECTION 4 1 NET EARNED PREMIUMS REPORTED AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 0 11 1995 XXX XXX XXX 0 SCHEDULE P - PART 7B - REINSURANCE LOSS SENSITIVE CONTRACTS SECTION 5 1 NET RESERVE FOR PREMIUM ADJMNTS & ACCRUED RETRO PREMIUMS ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 7B - REINSURANCE LOSS SENSITIVE CONTRACTS SECTION 5 1 NET RESERVE FOR PREMIUM ADJMNTS & ACCRUED RETRO PREMIUMS ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 0 11 1995 XXX XXX XXX 0 SCHEDULE P - PART 7B - REINSURANCE LOSS SENSITIVE CONTRACTS SECTION 6 1 INCURRED ADJUSTABLE COMMISSIONS REPORTED YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 7B - REINSURANCE LOSS SENSITIVE CONTRACTS SECTION 6 1 INCURRED ADJUSTABLE COMMISSIONS REPORTED YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 0 11 1995 XXX XXX XXX 0 SCHEDULE P - PART 7B - REINSURANCE LOSS SENSITIVE CONTRACTS SECTION 7 1 RESERVES FOR COMMISSION ADJUSTMENTS AT YEAR END ($000 OMITTED) YEARS 2 3 4 5 6 7 IN WHICH 1986 1987 1988 1989 1990 1991 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 0 0 02 1986 0 0 0 0 0 0 03 1987 XXX 0 0 0 0 0 04 1988 XXX XXX 0 0 0 0 05 1989 XXX XXX XXX 0 0 0 06 1990 XXX XXX XXX XXX 0 0 07 1991 XXX XXX XXX XXX XXX 0 08 1992 XXX XXX XXX XXX XXX XXX 09 1993 XXX XXX XXX XXX XXX XXX 10 1994 XXX XXX XXX XXX XXX XXX 11 1995 XXX XXX XXX XXX XXX XXX SCHEDULE P - PART 7B - REINSURANCE LOSS SENSITIVE CONTRACTS SECTION 7 1 RESERVES FOR COMMISSION ADJUSTMENTS AT YEAR END ($000 OMITTED) YEARS 8 9 10 11 IN WHICH 1992 1993 1994 1995 POLICIES WERE ISSUED 01 PRIOR 0 0 0 0 02 1986 0 0 0 0 03 1987 0 0 0 0 04 1988 0 0 0 0 05 1989 0 0 0 0 06 1990 0 0 0 0 07 1991 0 0 0 0 08 1992 0 0 0 0 09 1993 XXX 0 0 0 10 1994 XXX XXX 0 0 11 1995 XXX XXX XXX 0 -----END PRIVACY-ENHANCED MESSAGE-----