Assurant 2011 Annual Report Download - page 16

ASSURANT, INC.2011 Form10-K8
PARTI
ITEM 1 Business
Assurant Employee Benefi ts
For the Years Ended
December31,2011 December31,2010
Net Earned Premiums and Other Considerations:
Group dental $ 417,145 $ 420,690
Group disability(1) 452,964 488,813
Group life 193,914 191,892
TOTAL $ 1,064,023 $ 1,101,395
Segment net income $ 43,113 $ 63,538
Loss ratio(2) 72.2% 69.6%
Expense ratio(3) 35.4% 35.1%
Equity(4) $ 621,666 $ 582,574
(1) Includes single premiums for closed blocks.
(2) The loss ratio is equal to policyholder benefits divided by net earned premiums and other considerations.
(3) The expense ratio is equal to selling, underwriting and general expenses divided by net earned premiums and other considerations and fees and other income. (Fees and other income
are not included in the above table.)
(4) Equity excludes accumulated other comprehensive income.
Products and Services
We focus on the needs of businesses with fewer than 500employees.
We believe that our small group risk selection expertise, administrative
systems, and strong relationships with brokers who work primarily with
small businesses give us a competitive advantage versus other carriers.
We o er group disability, dental, vision, life and supplemental worksite
products as well as individual dental products.  e group products are
o ered with funding options ranging from fully employer-paid to fully
employee-paid (voluntary). In addition, we reinsure disability and life
products through our wholly owned subsidiary, Disability Reinsurance
Management Services,Inc. (“DRMS”).
Group Disability
Group disability insurance provides partial replacement of lost earnings
for insured employees who become disabled, as de ned by their plan
provisions. Our products include both short- and long-term disability
coverage options. We also reinsure disability policies written by other
carriers through our DRMS subsidiary.
Group Dental
Dental bene t plans provide funding for necessary or elective dental
care. Customers may select a traditional indemnity arrangement, a PPO
arrangement, or a prepaid or managed care arrangement. Coverage is
subject to deductibles, coinsurance and annual or lifetime maximums.
In a prepaid plan, members must use participating dentists in order
to receive bene ts.
Success in the group dental business is heavily dependent on a strong
provider network. Assurant Employee Bene ts owns and operates
Dental Health Alliance,L.L.C., a leading dental Preferred Provider
Organization (“PPO”) network. We also have an agreement with
Aetna that allows us to use Aetna’s Dental Access ® network, which we
believe increases the attractiveness of our products in the marketplace.
Group Vision
Fully-insured vision coverage is o ered through our agreement with
Vision Service Plan,Inc., a leading national supplier of vision insurance.
Our plans cover eye exams, glasses, and contact lenses and are usually
sold in combination with one or more of our other products.
Group Life
Group term life insurance provided through the workplace provides
bene ts in the event of death. We also provide accidental death and
dismemberment insurance. Insurance consists primarily of renewable term
life insurance with the amount of coverage provided being either a  at
amount, a multiple of the employee’s earnings, or a combination of the
two. We also reinsure life policies written by other carriers through DRMS.
Supplemental Worksite Products
In addition to the traditional voluntary products, we provide group
critical illness, cancer, accident, and gap insurance.  ese products are
generally paid for by the employee through payroll deductions, and
the employee is enrolled in the coverage(s) at the worksite.
Marketing and Distribution
Our products and services are distributed through a group sales
force located in 34 o ces near major metropolitan areas. Our sales
representatives distribute our products and services through independent
brokers and employee-bene ts advisors. Daily account management is
provided through the local sales o ces, further supported by regional
sales support centers and a home o ce customer service department.
Compensation of brokers in some cases includes an annual performance
incentive, based on volume and retention of business.
DRMS provides turnkey group disability and life insurance solutions to
insurance carriers that want to supplement their core product o erings.
Our services include product development, state insurance regulatory
 lings, underwriting, claims management, and other functions typically
performed by an insurer’s back o ce. Assurant Employee Bene ts
reinsures the risks written by DRMS’ clients, with the clients generally
retaining shares that vary by contract.