ALABAMA INSURANCE UNDERWzuTING ASSOCIATION FINANCIAL STATEMENTS JANUARY 31,2010

Transcription

1 ALABAMA INSURANCE UNDERWzuTING ASSOCIATION FINANCIAL STATEMENTS JANUARY 31,2010

2 FINANCIAL STATEMENTS JANUARY 3I,2O1O CONTENTS Exhibit Accountants' compilation report Statement of assets, liabilities and members' equity Statement of operations and members' equity Supplementary information : Members' equity - quarter and year to date 3A Members' equity for unsettled years - inception to date Statistical report of premiums Statistical report of losses Statistical report of loss adjustrnent expenses 3B 4A 4B 4C

3 NZ ZY ClSut-l-vax Cnrtqu.n Certified Public Accountants & Consultants 'I 725 North McKenzie Street P.O. Drawer April6,20l0 Foley, AL 3653G Fax: Alabama Insurance Underwriting Associatron 315 E. Laurel Ave., Ste. 216D Foley, AL We have compiled the accompanying statement of assets, liabilities and members' equity of Alabama Insurance Underwriting Association as of January 31, 2010, and the related statements of operations and members' equity for the three months then ended, and the accompanying supplementary information, which is presented only for supplementary analysis purposes, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. A compilation is limited to presenting in the form of financial statements, and supplementary information, information that is the representation of management. We have not audited or reviewed the accompanying financial statements and, accordingly, do not express an opinion or any other form of assurance on them. Management has elected to omit substantially all the disclosures ordinarily included in financial statements. If the omitted disclosures were included in the financial statements, they might influence the user's conclusions about the Association's financial condition. Accordingly, these financial statements are not designed for those who are not informed about such matters. f'/$ihi,tnn 6.!, LLP Certified Public Accountants Peroacola I:ort \\/rrlton licach Destin

4 STATEMENT OF ASSETS, LIABILITIES AND MEMBERS' EQUITY As of January 31, 2010 EXHIBIT 1 Ledger Assets Not Admitted Description Assets Admitted Assets ASSETS Cash 33,045,323 33,045,323 Interest accrued 1,450 1,450 Furniture and equipment - net of depreciation 55,909 55,909 Data processing equipment - net of depreciation 57,126 57,126 Programming - net of amortization 156, ,677 Section 444 Deposit (I.R.S.) 248, ,135 Prepaid Reinsurance Premium - - Intangible Pension Asset 31,642 31,642 Other 1,822 1,822 Total Assets 33,598, ,408 33,383,676 LIABILITIES AND EQUITY Reserves for: Unpaid losses (include IBNR) 936,517 Reins. Recoverable-unpaid losses - Unpaid loss adjustment expenses 70,239 Reins. Recoverable-unpaid loss. exp. - Unearned premiums 13,828,180 Premium taxes 38,239 Total Reserves 14,873,175 Payables for: Operating expenses and other accounts payable 204,248 Amounts withheld for A/C of others 21,552 Accrued Pension Obligation 27,748 Distributions Payable Members - Premiums Refundable - Premiums received in advance 1,088,623 Ceded Reinsurance Payable 541,398 Total Payables 1,883,569 Members' Equity 16,626,932 Total Liabilities and Equity 33,383,676

5 STATEMENT OF OPERATIONS AND MEMBERS' EQUITY Quarter Ended January 31, 2010 EXHIBIT 2 Quarter Year-To-Date 11/01/ /01/ DESCRIPTION 01/31/ /31/2010 UNDERWRITING INCOME: Premiums Earned 4,086,983 4,086,983 DEDUCTIONS: Losses incurred 25,991 25,991 Loss expenses incurred 12,902 12,902 Operating expenses incurred 1,171,456 1,171,456 Total deductions 1,210,349 1,210,349 Net Underwriting Gain or (Loss) 2,876,634 2,876,634 OTHER INCOME (EXPENSE): Net investment income 5,275 5,275 Realized Gains (Losses) - - Other Income Service fees 74,914 74,914 Total other income (expense) 80,207 80,207 Net Income or (Loss) 2,956,841 2,956,841 EQUITY ACCOUNT: Members' equity (prior period) 13,681,961 13,681,961 Net income or (loss) 2,956,841 2,956,841 Change in assets not admitted (11,870) (11,870) Assessments or (distributions) - - Net change in equity 2,944,971 2,944,971 Members' Equity (current period) 16,626,932 16,626,932

6 SUPPLEMENTARY INFORMATION

7 MEMBERS' EQUITY Quarter Ended January 31, 2010 EXHIBIT 3A Quarter 11/01/ /31/2010 Year-to-Date 11/01/ /31/2010 Description Total Total INCOME RECEIVED: Premiums Written 5,582,901 (126,689) ,456,212 5,582,901 (126,689) ,456,212 Reinsurance Premium Ceded (4,418,259) (4,418,259) (4,418,259) (4,418,259) Net Premiums Written 1,164,642 (126,689) ,037,953 1,164,642 (126,689) ,037,953 Interest Received 5, ,107 5, ,107 Realized Gains Other Income Service Fees 74, ,914 74, ,914 Gain on sale of non admitted asset Total Income 1,244,681 (126,689) ,117,992 1,244,681 (126,689) ,117,992 EXPENSES PAID: Losses 11,707 44,706 53, ,787 11,707 44,706 53, ,787 Loss Adjustment Expenses 1,786 9, ,205 4,171 19,187 1,786 9, ,205 4,171 19,187 Commissions 318, , , , , ,578 Operating Expenses 432, , , , , ,505 Premium Taxes 167, , , , , ,240 Total Expenses Paid 931, ,501 53, ,205 4,171 1,491, , ,501 53, ,205 4,171 1,491,297 Net Cash Change 313,635 (625,190) (53,374) - - (4,205) (4,171) (373,305) 313,635 (625,190) (53,374) - - (4,205) (4,171) (373,305) REINSURANCE RECOVERABLE: DEDUCT (PRIOR PERIOD) Reins. Recoverable-Losses Paid Reins. Recoverable-Loss Exp. Paid ADD (CURRENT PERIOD) - Reins. Recoverable-Losses Paid Reins. Recoverable-Loss Exp. Paid Net Change RESERVES: DEDUCT (CURRENT PERIOD) Unpaid Losses (include IBNR) 93, , ,000 55, ,517 93, , ,000 55, ,517 Reins. Recoverable-Unpaid Losses Unpaid Loss Adj. Expenses 7,016 42, ,875 4,125 70,239 7,016 42, ,875 4,125 70,239 Operating Expenses 225, , , ,800 Unearned Premiums 3,948,156 9,880, ,828,180 3,948,156 9,880, ,828,180 Premium Taxes 38, ,239 38, ,239 ADD (PRIOR PERIOD) Unpaid Losses (include IBNR) - 605, , , ,000 1,020, , , , ,000 1,020,313 Reins. Recoverable-Unpaid Losses Unpaid Loss Adj. Expenses - 45,399 10, ,375 16,875 76,524-45,399 10, ,375 16,875 76,524 Operating Expenses - 327, , , ,801 Unearned Premiums - 16,877, ,877,210-16,877, ,877,210 Premium Taxes - 127, , , ,105 Net Reserve Change (4,312,761) 7,497, , (193,500) 182,750 3,329,978 (4,312,761) 7,497, , (193,500) 182,750 3,329,978 OTHER CHANGES: DEDUCT (PRIOR PERIOD) Interest Accrued - 1, ,282-1, ,282 Assets Not Admitted - (202,538) (202,538) - (202,538) (202,538) ADD (CURRENT PERIOD) - - Interest Accrued 1, ,450 1, ,450 Assets Not Admitted (214,408) (214,408) (214,408) (214,408) Net Other Changes (212,958) 201, (11,702) (212,958) 201, (11,702) Assessments or (Distributions) Change in Members' Equity (4,212,084) 7,073, , (197,705) 178,579 2,944,971 7,073, , (197,705) 178,579 2,944,971

8 MEMBERS' EQUITY FOR UNSETTLED YEARS Inception to Quarter Ended January 31, 2010 Exhibit 3B Description Total INCOME RECEIVED: Premiums Written 5,582,901 29,609,785 24,452,221 23,456,599 17,328,303 6,309,269 5,411, ,150,314 Reinsurance Premiums Ceded (4,418,259) (16,106,473) (14,994,792) (10,799,284) (4,500,230) (1,882,296) (2,030,922) (54,732,256) Net Premiums Written 1,164,642 13,503,312 9,457,429 12,657,315 12,828,073 4,426,973 3,380,314 57,418,058 Interest Received 5, , , , , , ,321 2,021,314 Realized Gains (86) (31,218) (31,304) Other Income ,391 3, , ,582 Service Fees 74, , , , ,703 29,034 13,920 1,143,340 Gain on sale of non admitted asset (203) Total Income 1,244,681 14,006,135 10,216,805 13,526,749 13,311,220 4,672,505 3,586,415 60,564,510 EXPENSES PAID: Losses 11,707 96, , , ,913 12,109,950 18,685,847 33,219,281 Loss Adjustment Expenses 1,786 20,866 21,099 14,945 17,029 1,294,763 1,536,237 2,906,725 Commissions 318,247 2,365,555 1,961,534 2,235,084 1,744, , ,534 9,796,130 Operating Expenses 432,171 2,013,301 1,753,057 1,450,948 1,036, , ,359 8,326,840 Premium Taxes 167,135 1,028, , , , , ,338 3,899,729 Total Expenses Paid 931,046 5,524,962 5,463,502 5,061,567 4,352,440 15,210,873 21,604,315 58,148,705 Net Cash Change 313,635 8,481,173 4,753,303 8,465,182 8,958,780 (10,538,368) (18,017,900) 2,415,805 REINSURANCE RECOVERABLE: ADD (Current Period) Reins. Recoverable-Losses Paid Reins. Recoverable-Loss Exp. Paid Net Change RESERVES: DEDUCT (CURRENT PERIOD) Unpaid Losses (include IBNR) 93, , ,000 55, ,517 Reins. Recoverable-Unpaid Losses Unpaid Loss Adjustment Expenses 7,016 42, ,875 4,125 70,239 Operating Expenses 225, ,800 Unearned Premiums 3,948,156 9,880, ,828,180 Premium Taxes 38, ,239 Total Reserves 4,312,761 10,485, ,875 59,125 15,098,975 OTHER CHANGES: ADD Interest Accrued 1, ,450 Assets Not Admitted (214,408) (214,408) Total Other Changes (212,958) (212,958) Assessments or (Distributions) ,000,000 19,523,060 29,523,060 Net Members' Equity (4,212,084) (2,004,041) 4,753,303 8,465,182 8,958,780 (780,243) 1,446,035 16,626,932

9 STATISTICAL REPORT OF PREMIUMS Quarter Ended January 31, 2010 EXHIBIT 4A Quarter 11/01/ /31/2010 Year-to-Date 11/01/ /31/2010 Description Total Total PREMIUMS WRITTEN: Fire 338,197 (9,487) , ,197 (9,487) ,710 E.C. & VMM 5,244,704 (117,202) ,127,502 5,244,704 (117,202) ,127,502 Reinsurance Premium Ceded E.C. (4,418,259) (4,418,259) (4,418,259) (4,418,259) Total 1,164,642 (126,689) ,037,953 1,164,642 (126,689) ,037,953 UNEARNED PREMIUMS: (PRIOR PERIOD) Fire 970, , , ,720 E.C. & VMM 15,906, ,906,490-15,906, ,906,490 Reinsurance Unearned Ceded E.C Total - 16,877, ,877,210-16,877, ,877,210 UNEARNED PREMIUMS: (CURRENT PERIOD) Fire 241, , , , , ,894 E.C. & VMM 3,706,511 9,313, ,020,286 3,706,511 9,313, ,020,286 Reinsurance Unearned Ceded E.C Total 3,948,156 9,880, ,828,180 3,948,156 9,880, ,828,180 EARNED PREMIUMS: Fire 394, ,984 96, , ,536 E.C. & VMM 6,475, ,475,513 1,538,193 6,475, ,013,706 Reinsurance Earned Ceded E.C (4,418,259) (4,418,259) Total (2,783,514) 6,870, ,086,983 (2,783,514) 6,870, ,086,983

10 STATISTICAL REPORT OF LOSSES Quarter Ended January 31, 2010 EXHIBIT 4B Quarter 11/01/ /31/2010 Year-to-Date 11/01/ /31/2010 Description Total Total PAID LOSSES: Fire 8,600 15,239 53, ,213 8,600 15,239 53, ,213 E.C. & VMM 3,107 29, ,574 3,107 29, ,574 Reinsurance Recovery E.C Total 11,707 44,706 53, ,787 11,707 44,706 53, ,787 OUTSTANDING LOSSES (CURRENT PERIOD)* Fire 5,717 31, ,927 5,717 31, ,927 E.C. & VMM 87, , ,000 55, ,590 87, , ,000 55, ,590 Reinsurance Recoverable E.C Total 93, , ,000 55, ,517 93, , ,000 55, ,517 OUTSTANDING LOSSES (PRIOR PERIOD)* Fire 40, , ,499-40, , ,499 E.C. & VMM 564, , , , , , , ,814 Reinsurance Recoverable E.C Total - 605, , , ,000 1,020, , , , ,000 1,020,313 INCURRED LOSSES: Fire 14,317 5,950 (91,626) (71,359) 14,317 5,950 (91,626) (71,359) E.C. & VMM 90,940 (3,590) ,000 (170,000) 97,350 90,940 (3,590) ,000 (170,000) 97,350 Total 105,257 2,360 (91,626) ,000 (170,000) 25, ,257 2,360 (91,626) ,000 (170,000) 25,991 IBNR (CURRENT PERIOD) Fire 5,717 29, ,877 5,717 29, ,877 E.C. & VMM 87, , ,090 87, , ,090 Total 93, , ,967 93, , ,967 IBNR (PRIOR PERIOD) Fire 34, ,999-34, ,999 E.C. & VMM 564, , , ,814 Total - 599, , , ,813 *Includes IBNR

11 STATISTICAL REPORT OF LOSS ADJUSTMENT EXPENSES Quarter Ended January 31, 2010 Quarter 11/01/ /31/2010 Year-to-Date 11/01/ /31/2010 Description Total Total LOSS EXPENSES PAID: Fire - 1, ,105-1, ,105 E.C. & VMM 1,786 7, ,205 4,171 18,082 1,786 7, ,205 4,171 18,082 Reinsurance Recovery E.C Total 1,786 9, ,205 4,171 19,187 1,786 9, ,205 4,171 19,187 UNPAID LOSS EXPENSES (CURRENT PERIOD)* Fire 429 2, , , ,770 E.C. & VMM 6,587 39, ,875 4,125 67,469 6,587 39, ,875 4,125 67,469 Reinsurance Recoverable E.C Total 7,016 42, ,875 4,125 70,239 7,016 42, ,875 4,125 70,239 UNPAID LOSS EXPENSES (PRIOR PERIOD)* Fire - 3,038 10, ,913-3,038 10, ,913 E.C. & VMM - 42, ,375 16,875 62,611-42, ,375 16,875 62,611 Reinsurance Recoverable E.C Total - 45,399 10, ,375 16,875 76,524-45,399 10, ,375 16,875 76,524 INCURRED LOSS EXPENSES: Fire (10,875) (10,038) (10,875) (10,038) E.C. & VMM 8,373 5, ,705 (8,579) 22,940 8,373 5, ,705 (8,579) 22,940 Total 8,802 5,849 (10,875) ,705 (8,579) 12,902 8,802 5,849 (10,875) ,705 (8,579) 12,902 EXHIBIT 4C *Includes IBNR