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ASSURANT, INC.2012 Form10-K42
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,
2012
2011
2010
Revenues:
Net earned premiums and other considerations $ 2,579,220 $ 2,438,407 $ 2,484,299
Net investment income 396,681 393,575 397,297
Fees and other income 314,072 265,204 228,052
Total revenues 3,289,973 3,097,186 3,109,648
Bene ts, losses and expenses:
Policyholder bene ts 840,133 847,254 884,405
Selling, underwriting and general expenses(4) 2,267,986 2,037,680 2,059,245
Total bene ts, losses and expenses 3,108,119 2,884,934 2,943,650
Segment income before provision for income taxes 181,854 212,252 165,998
Provision for income taxes 58,101 76,202 64,465
SEGMENT NET INCOME $ 123,753 $ 136,050 $ 101,533
Net earned premiums and other considerations:
Domestic:
Credit $ 165,765 $ 173,287 $ 189,357
Service contracts 1,260,578 1,198,510 1,291,725
Other(1) 62,298 53,219 49,016
Total Domestic 1,488,641 1,425,016 1,530,098
International:
Credit 425,078 391,124 346,475
Service contracts 556,207 495,853 459,166
Other(1) 28,316 24,692 18,002
Total International 1,009,601 911,669 823,643
Preneed 80,978 101,722 130,558
TOTAL $ 2,579,220 $ 2,438,407 $ 2,484,299
Fees and other income:
Domestic:
Debt protection $ 27,912 $ 29,501 $ 33,049
Service contracts 139,636 120,896 110,386
Other(1) 4,039 4,123 8,839
Total Domestic 171,587 154,520 152,274
International: 38,840 32,059 28,930
Preneed 103,645 78,625 46,848
TOTAL $ 314,072 $ 265,204 $ 228,052
Gross written premiums(2):
Domestic:
Credit $ 390,648 $ 399,564 $ 422,825
Service contracts 1,799,577 1,470,605 1,193,423
Other(1) 113,067 86,503 65,732
Total Domestic 2,303,292 1,956,672 1,681,980
International:
Credit 1,002,347 1,013,486 968,878
Service contracts 722,251 622,674 523,382
Other(1) 44,721 45,312 22,407
Total International 1,769,319 1,681,472 1,514,667
TOTAL $ 4,072,611 $ 3,638,144 $ 3,196,647
Preneed (face sales) $ 863,734 $ 759,692 $ 734,884
Combined ratio(3):
Domestic 98.9% 97.3% 100.3%
International 104.8% 104.0% 106.1%
(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) 2012& 2010 selling, underwriting and general expenses include $26,458 and $47,612, respectively, of intangible asset impairment charges.