Assurant 2010 Annual Report Download - page 46

40 ASSURANT, INC.  2010 Form 10K
PART II
ITEM 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations
Assurant Solutions
Overview
 e table below presents information regarding Assurant Solutions’ segment results of operations:
For the Years Ended December 31,
2010 2009 2008
Revenues:
Net earned premiums and other considerations $ 2,484,299 $ 2,671,041 $ 2,813,407
Net investment income 397,297 391,229 420,615
Fees and other income 228,052 216,550 182,508
Total revenues 3,109,648 3,278,820 3,416,530
Benefi ts, losses and expenses:
Policyholder benefi ts 889,387 1,029,151 1,198,758
Selling, underwriting and general expenses (5) 2,052,628 2,055,348 2,041,892
Total benefi ts, losses and expenses 2,942,015 3,084,499 3,240,650
Segment income before provision for income taxes 167,633 194,321 175,880
Provision for income taxes 64,427 74,269 63,697
SEGMENT NET INCOME $ 103,206 $ 120,052 $ 112,183
Net earned premiums and other considerations:
Domestic:
Credit $ 189,357 $ 241,293 $ 279,497
Service contracts 1,291,725 1,411,953 1,364,886
Other (1) 49,017 84,939 60,159
Total Domestic 1,530,099 1,738,185 1,704,542
International:
Credit 346,475 320,462 368,442
Service contracts 459,166 415,694 355,248
Other (1) 18,001 15,731 20,175
Total International 823,642 751,887 743,865
Preneed (4) 130,558 180,969 365,000
TOTAL $2,484,299 $ 2,671,041 $ 2,813,407
Fees and other income:
Domestic:
Debt protection $ 33,049 $ 40,058 $ 34,459
Service contracts 110,386 102,410 79,298
Other (1) 8,839 18,534 26,661
Total Domestic 152,274 161,002 140,418
International 28,930 27,730 32,919
Preneed (4) 46,848 27,818 9,171
TOTAL $ 228,052 $ 216,550 $ 182,508
Gross written premiums (2):
Domestic:
Credit $ 422,825 $ 526,532 $ 604,101
Service contracts 1,193,423 1,012,670 1,530,284
Other (1) 65,732 92,111 71,393
Total Domestic 1,681,980 1,631,313 2,205,778
International:
Credit 968,878 843,225 827,457
Service contracts 523,382 462,964 477,652
Other (1) 22,407 26,567 27,381
Total International 1,514,667 1,332,756 1,332,490
TOTAL $ 3,196,647 $ 2,964,069 $ 3,538,268
Preneed (face sales) $ 734,884 $ 512,366 $ 445,313
Combined ratio (3):
Domestic 100.5 % 97.2 % 100.6 %
International 105.9 % 110.7 % 108.2 %
(1) This includes emerging products and run-off products lines.
(2) Gross written premiums does not necessarily translate to an equal amount of subsequent net earned premiums since Assurant Solutions reinsures a portion of its premiums to insurance
subsidiaries of its clients.
(3) The combined ratio is equal to total benefits, losses and expenses divided by net earned premiums and other considerations and fees and other income excluding the preneed business.
(4) Effective January 1, 2009, new preneed life insurance policies in which death benefit adjustments are determined at the discretion of the Company are accounted for as universal life
contracts. For contracts sold prior to January 1, 2009, these preneed life insurance policies were accounted for and will continue to be accounted for under the limited pay insurance
guidance. In accordance with the universal life insurance guidance, income earned on new preneed life insurance policies is presented within policy fee income net of policyholder
benefits. Under the limited pay insurance guidance, the consideration received on preneed policies is presented separately as net earned premiums, with policyholder benefits expense
being shown separately. The change from reporting certain preneed life insurance policies in accordance with the universal life insurance guidance versus the limited pay insurance
guidance is not material to the statement of operations or balance sheet.
(5) 2010 selling, underwriting and general expenses includes a $47,612 intangible asset impairment charge.