Reserving, Reinsurance, Recapitalization, and Ratings
By a
In response to these and other issues, Demotech withdrew its guidance on
In the aggregate, the carriers that we review and rate in
In certain cases, Demotech reviewed rate level information and analyses prepared by credentialed actuaries intent on determining whether insurer rate structures were not excessive nor inadequate. In an operating environment in transition, there is no substitute for a realistic rate level. The overwhelming majority of the carriers reviewed appeared to have the situation under control. This is critical because a realistic rate structure is a necessary component of the successful implementation of a business model.
Based upon our review of information including year-end financial statements, our interpretation of the deterioration of the operating environment in
As the companies have addressed our requests related to capitalization while simultaneously revisiting loss and loss adjustment expense reserve adequacy at year-end 2016, we look forward to completing our review of
In part due to the significant underwriting loss reported in 2016, the FSR assigned to
Although the Company met or exceeded the level of capital and surplus required under the statutes of the
Although the Company met or exceeded the level of capital and surplus required under the statutes of the
Although the Company raised additional capital to meet the level requested by Demotech, the successful implementation of its business model and plan under the current operating environment would have likely required additional capitalization in the future. In response, the investors controlling the Company recommitted to Floridians by selling a majority interest to
Keywords for this news article include: Legal Issues,
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