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While trust and
confidence have eroded throughout the
business world this past year, we remain
committed to providing you with the
protection, service and integrity you can
rely on.
We value the trust you place in us as your
insurer and thank you for giving us the
opportunity to serve you.
2008 proved to be one of, if not the most
challenging years in the company’s 100 years
of operation.
For the year, direct written premium
increased 1%, going from $145 million to
$146.5 million. Unfortunately, incurred
losses rose significantly from 2007, going
from $79.6 million to $88.3 million or 11%!
The substantial increase in losses generated
a net underwriting loss of $6.7 million,
which was led by our two largest lines;
personal automobile produced a $5 million
loss and homeowners a $4.9 million loss.
Additionally, the company experienced a
noticeable increase in losses attributed to
the deterioration of the economy, such as
vacant and foreclosed properties and fraud.
We continue to look for ways to control
these types of losses.
Admitted assets decreased nearly $26 million
to $302 million.
Total net investment income remained flat at
$13.6 million.
Our reserve for policyholder protection
decreased nearly 10% or $19 million, ending
at $176 million.
Although 2008 will go down as one of the
most challenging years on record for the
company, the positive results from 2005
through 2007 will enable us to continue
forward with our business objectives without
interruption. As a statement to the
company’s financial strength, we recently
received notification from AM Best that our
A+ rating has been affirmed for another
year.
2009 will be another year of a challenging
environment both on an operational and
investment income basis. The management team
and all employees remain focused and poised
to take on the challenges and opportunities
the future presents.
We are blessed to be affiliated with such a
loyal group of policyholders, strong network
of independent agents and dedicated team of
employees.
We are proud of the protection, services and
financial stability we have provided for
over 100 years to some 164,000 Michigan
individuals and families. Lord willing, we
hope to do it another 100 years.
Kurt P. Foley
President, CEO |
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