Mercury Insurance 2009 Annual Report Download - page 129

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SCHEDULE II, Continued
MERCURY GENERAL CORPORATION
CONDENSED FINANCIAL INFORMATION OF REGISTRANT
NOTES TO CONDENSED FINANCIAL INFORMATION
The accompanying condensed financial information should be read in conjunction with the Consolidated
Financial Statements and Notes to Consolidated Financial Statements included in this report.
Reclassifications
Certain reclassifications have been made to prior year balances to conform to the current year presentation.
Dividends Received from Subsidiaries
Dividends of $110,000,000, $140,000,000, and $127,000,000 were received by the Company from its
wholly-owned subsidiaries in 2009, 2008, and 2007, respectively, and are recorded as a reduction to investment
in subsidiaries.
Capitalization of Subsidiaries
No capital contributions were made by the Company to its insurance subsidiaries during 2009 and 2008.
Capital contribution of $11,250,000 was made in 2007.
Guarantees
The borrowings by MCC, a subsidiary, under the $120 million credit facility and $18 million bank loan are
secured by approximately $200 million of municipal bonds, at fair value, held as collateral. The total borrowings
of $138 million are guaranteed by the Company.
Federal Income Taxes
The Company files a consolidated federal income tax return with the following subsidiaries:
Mercury Casualty Company Mercury Insurance Company of Florida
Mercury Insurance Company Mercury Indemnity Company of America
California Automobile Insurance Company Mercury Select Management Company, Inc.
California General Underwriters Insurance Company American Mercury MGA, Inc.
Mercury Insurance Company of Illinois Concord Insurance Services, Inc.
Mercury Insurance Company of Georgia Mercury Insurance Services, LLC
Mercury Indemnity Company of Georgia Mercury Group, Inc.
Mercury National Insurance Company AIS Management, LLC
American Mercury Insurance Company Auto Insurance Specialists, LLC
American Mercury Lloyds Insurance Company PoliSeek AIS Insurance Solutions, Inc.
Mercury County Mutual Insurance Company
The method of allocation between the companies is subject to agreement approved by the Board of
Directors. Allocation is based upon separate return calculations with current credit for net losses incurred by the
insurance subsidiaries to the extent it can be used in the current consolidated return.
S-7