Insurance Companies

Insurance CompaniesGramm-Leach-Bliley Act (GLB) November 1999GLB allows banks, security dealers, and insurance companies to combine to form financial services holding companies. GLB allows banks to acquire insurance companies, insurance companies to acquire banks, banks to start their own insurance companies, and insurance companies to start banks.Regardless of its form of legal organization, the main function of an insurance company is to redistribute the cost of losses.

Types of Insurance CompaniesStock Insurance CompaniesMutual Insurance CompaniesLloyds of LondonReciprocal ExchangeFraternal InsurersSavings Bank Life InsuranceBlue Cross and Blue ShieldHealth Maintenance OrganizationsPreferred Provider OrganizationsMost Important OnesMutual IC and Stock ICWrite either life or nonlife insurance coverageInsurance holding companies can combine both life and nonlife insurance, but should keep operations separate. Multiple line insurers property insurers that provide more than one type of coverage.Stock Insurance CompaniesStockholder-owners provide the capital to establish and operate a corporation. Owners are entitled to the financial results, whether favorable or unfavorable.They exercise right to vote and elect the management of the corporation.Mutual Insurance CompaniesNonprofit corporationsOwners are the insured policyholders Have rights to vote and elect managementDifference?SIC - own an interest in the stock company and not purchase a insurance from it; Being insured and not having an ownership interest.SIC - additional funds not provided by past or present insureds, but by owners, can be used to absorb losses and expenses not covered by premiums.

Subcategories of MICAdvance Premium MutualsAssessment MutualsFactory MutualsPerpetual MutualsAdvance Premium MutualsHighest volume of insurance writtenPremiums during insurance and dividends when favorable resultsMutual Life insurance favorable operating results are the normDividend return of part of the premiumNot subject to federal income taxAssessment MutualDo much less businessInsured members may or may not pay a premium.But liable to pay fair share of losses and expenses. Liability may or may not be limited

Factory Mutual Provides substantial loss prevention services, regular inspection of the insured premises Highly protected risk only those exposures meeting rigid safety and construction qualifications can qualify for coverageAdvance deposit of the entire premium Selective underwriting insurance costs can be significantly lowerPerpetual MutualRequires each insured to contribute to a large initial premium, with no future premiums18th century by Ben FranklinVery rare in insurance marketplaceDemutualization1st method: Occurs when a mutual insurer changes its legal form to that of a stock company.Overcome a limit on the amount of policyholder dividends a mutual insurer can deduct on its federal tax return, causing an increased tax liability.Financial weakness

DemutualizationGLB Act encouraged demutualizationStock insurers more flexible capital structuresOwnership rights membership rightsConsumer groups critics: not fair market value of interests in cash; voting stock to existing policyowners, fin. markets will set the value of each share.

Demutualization2nd method: mutual holding company a mutual insurance company forms and owns a stock insurance company.Complicated transactions, many problemsLife Insurance Fact Book decreased from 109 to 83 MIC providing 10.4% of life insurance.Lloyds of LondonHas been one of the worlds most important markets for marine, aviation, and other lines of insurance. Since 1980s billions of losses. 3% of the global nonlife10% large industrial insuranceInteresting market for marine, aviation, reinsuranceLloyds of LondonA large insurance marketplaceA meeting place where sellers (underwriters) meet buyers(orgs with exposures to loss)NYSE broker meets brokerLloyds broker meets underwriter1688, coffeehouse of Edward LloydUnderwriting syndicateGeneral Insurance Standards Council of LloydsA premium trust fundReciprocal ExchangeLike a mutual insurance company policyholders insure each other on a nonprofit basis.Reciprocal exchange is unincorporated each insured insures every other insuredAutomobile insurance is of considerable amountManaged by an attorney-in-factFraternal InsurersSome fraternal orders or societies Aid Association for Lutherans or the Knights of ColumbusLife insurance protection2% of all life insuranceSavings Bank Life InsuranceLargest amount of life insurance in these states: New York, Connecticut, Massachusetts, and other East Coast statesBlue Cross and Blue ShieldHealth insurance over 80 million of Americans in 2003 Blue Cross provides direct payments to health care providers on behalf of their insureds. Specified no. of days coverage.Blue Shield provides payments for physicians services, including dental and vision services. Based on usual, reasonable, and customary charges.Blue Cross and Blue ShieldIn all 50 states80% of U.S. hospitals and 90% U.S. physicians accept $111 billion claims a yearHealth Maintenance OrganizationsMore than half of the health insurance marketOperate in limited geographic areas Broad health care coverage for a set of fee capitation paymentPhysicians charges, hospital costs, X-ray films, and emergency carePreventive physical examinationsPopular for providing broad coverage, for stressing prevention, not requiring long claims to be filedPreferred Provider OrganizationsAssociations of cooperating physicians and hospitalsAgree to provide employers with health care services for their employees for discount prices

Differences?Employers cost with PPOs is determined by useCovered employees do not have to use the personnel or facilities of the PPOPPO arrangement may not provide coverage for annual physical examinations as do HMOs

Insurance Industry in 20011,200 life insurance companies 900 property insurance companies20 largest competitorsFew barriers to enteringOver 2 million employedwww.iii.org Insurance Information Institute

Top Ten Insurance Companies in the United States

Allstate Insurance CompanyState Farm Insurance CompanyPrudential Insurance CompanyTravelers Insurance CompanyFidelity Insurance CompanyMetLife Insurance CompanyFarmers Insurance CompanyAIG Insurance CompanyMassMutual Insurance CompanyThe Hartford Insurance Company

TopRatedInsuranceCompanies.com

Top 10 Insurance CompaniesTopRatedInsuranceCompanies.com has put together a comprehensive list of the top 10 insurance companies in the United States for the year 2009 (so far).

Top 10 Insurance Companies:1.)Allstate Insurance Company-Allstate auto insurance quotes and anonymous ballpark estimates to help protect you, your family and your automobile. Insurance and financial products include car insurance, home insurance, business insurance, life insurance, IRAs and annuities.2.)State Farm Insurance Company-State Farm Insurance offers coverage for auto, life, home, health, and more. State Farm also offers mutual funds, banking, loans, and credit cards.3.)Prudential Insurance Company-Life Insurance, Annuities, Mutual Funds, Long Term Care, Real Estate and Retirement Services from Prudential Financial.4.)Travelers Insurance Company-Protect your personal and business investments with Travelers Insurance. From auto insurance to homeowners or business insurance, we have the solution to suit your needs.5.)Fidelity Insurance Company-Fidelity has the people, guidance, and investments to help you find your way, whatever your destination. Fidelity offers up to the minute financial news, market updates, stock quotes and all the financial services you?ll need to reach your goals.6.)MetLife Insurance Company-MetLife offers life insurance, annuities, disability insurance, retirement products, auto insurance, dental insurance, employee benefits, banking, and more.7.)Farmers Insurance Company-Farmers Insurance Group offers insurance including auto insurance, home insurance and life insurance. Farmers HelpPoint claims service offered through Farmers Insurance Company.8.)AIG Insurance Company International insurance and financial services organization, with operations in approximately 130 countries and jurisdictions.9.)MassMutual Insurance Company-Learn how products and solutions from MassMutual can be part of your financial plan. Well help you get there.10.)The Hartford Insurance Company-Offers a complete line of personal insurance and financial service products, including auto, homeowners, life, annuities, and mutual funds.

2009 Largest Insurance CompaniesTopping the list is a Japanese company, Japan Post Insurance Co Ltd, with $1,095,621,460,000 in assets. Yes, you are reading that correctlyJapan Post has over one trillion dollars in assets.Believe it or not, that total is actually down 5.28 percent from the previous year. Still not too shabby.A French company, Axa SA, snagged the second spot with slightly less than one trillion dollars in assets.Their 2009 balance sheet revealed a 5.69 percent increase from 2008, with $962,833,608,000 in assets.American International Group, Inc (AIG) was the largest U.S insurance company, and the third largest in the world.Looks like the government bailout helped them stay alive with $847,585,000,000 in assets on their books.Rounding out the top five were MetLife, Inc and Prudential Financial, Inc, the only other two insurers from the United States to make it into the top ten, with $539,314,000,000 and $480,203,000,000, in assets, respectively.A total of five U.S. insurers made the top 25 largest insurers in the world, including Hartford Financial Services Group, Inc and Warren Buffets Berkshire Hathaway (which includes GEICO).

The top 25 insurance companies in the world2010RankCompanyMarket Value (Billions)1China Life Insurance118.742Ping An Insurance Group52.803Allianz52.744AXAGroup46.025INGGroup35.466Generali Group35.197Zurich Financial Services34.718Manulife Financial32.569China Pacific Insurance32.2110Munich Re30.1211MetLife29.9312The Travelers Companies27.2613Prudential Financial24.8614Aflac23.4715Tokio Marine Holdings22.2916Prudential20.0517QBE Insurance Group19.7418ACE16.9719Allstate16.9420Chubb16.7721Swiss Re16.4422Sun Life Financial16.2423Cathay Financial15.8624CNAFinancial15.6425Aviva15.51http://www.economywatch.com/insurance-in-world/top-insurancecompanies.html?page=fullKyrgyz Insurance Companies19 insurance companies registered in Kyrgyzstan 14 are operating, reported by the State Service for Regulation and Supervision of Financial State of the Kyrgyz Republic. 2 reinsurance companies (Strahovoi reserv (Insurance Reserve) and Favorite) and 5 companies with non-residents participation (ICJSC Kyrgyzinstrah, Rosstrah Kyrgyzstan CJSC IC, London Bishkek CJSC, Strahovoi reserv CJSC, CJSC Affiliated Company Neftenaya IC). The major part of the insurance business is concentrated in the capital of 13 companies and only 1 insurance company is operating in Jalal-Abad (Dos-invest Insurance Company). Three insurance companies have their regional branches. Activities of several organizations were suspended: Strahovoi dom OJSC Insurance Company, English-Kyrgyz Insurance Company CJSC, Capital Insurance Association CJSC, AUB-insurance CJSC, Kyrgyz reinsurance company CJSC. Total assets of - 833.7 million KGS and increased by 3.6%. Net worth of insurance companies is estimated at 621.8 million KGS, it decreased by 5%. Obligations of companies accounted for 94.4 million KGS and also decreased by 37.2%. Total insurance reserves, established by insurance (reinsurance) organizations to ensure fulfillment of obligations amounted to 75 million KGS. It increased by 2.9 %.URL: http://eng.24.kg/business/2011/07/15/19244.html