Make your own free website on Tripod.com



The "Farmers Insurance News-Alert" website is dedicated to providing the consumer and general public with detailed information concerning the Farmers Insurance Group. This includes fraud reports, consumer complaints, lawsuit's and other legal actions taken against this company. All information contained herein is for educational purposes only. Original sources, when known are sited.

 

Financial Review Tuesday, 19-Dec-2000 00:30:14 EST

Consolidated Results
In 1998, Farmers Group, Inc.'s net income was $576.8 million. Excluding $21.1 million of costs associated with the merger with Zurich and a $46.0 million write-off of impaired assets, net income before realized capital gains and losses totaled $591.2 million for the year, an increase of nearly 10 percent over 1997.

Management Services
Revenues, which primarily consist of management fees from the Exchanges and their subsidiaries, continued to grow, reaching a record level of $1,358.2 million for the year, up 2.5 percent over 1997. This growth was directly attributable to growth in the P&C Group's gross earned premiums, which increased from $10.1 billion in 1997 to $10.3 billion in 1998, despite increasingly competitive market conditions. Excluding the merger and write-off expenses, total operating expenses, at $735.0 million, decreased as a percentage of revenues for the fourth consecutive year. This decrease reflects continued attention to cost control and further efficiencies realized through the greater use of information technology systems. Investment income decreased by 6.3 percent in 1998 to $135.1 million, primarily due to the capital contribution made to Farmers Re during the year. Net income from providing management services, excluding realized capital gains and losses and the merger and write-off expenses, totaled $425.6 million, a $21.8 million, or 5.4 percent, increase over 1997.

Reinsurance
Beginning in 1998, Farmers Re entered into a reinsurance agreement with the Exchanges and their subsidiaries under which it reinsures a per-centage of the auto physical damage business written. This reinsurance agreement increases the P&C Group's underwriting capacity, while providing another source of revenue for Farmers Group, Inc. In 1998, Farmers Re contributed $26.3 million to Farmers Group, Inc.'s consolidated net income before realized capital gains and losses.

Life Insurance
In 1998, Farmers Life's sales volume increased to a record $16.9 billion and, as a result, total insurance in-force grew 7.6 percent to $106.5 billion at year-end. Revenues from traditional life policies increased $19.8 million, or 14.7 percent, and revenues from universal life policies increased $5.6 million, or 2.8 percent, reflecting the higher volume of insurance in-force. A reduction in the level of net realized gains in 1998 led to a slight reduction in life insurance net income compared to the previous year but, excluding realized capital gains and losses, Farmers Life's net income increased 6.2 percent over 1997.

 

Attention! All information contained herein is for educational purposes only. No copyright infringement is intended by any material on these pages. The copyrights of the whole multimedia content on these pages are belonging to their originators, authors, creators... etc. All original content is the property of it's originators. Copyrighted material has been used for non-commercial purposes only. This website is best viewed with your monitor resolution set to 800x600 and your video mode set to true color.