United Healthcare 2012 Annual Report Download - page 36

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Our ability to obtain funds from some of our subsidiaries is restricted and if we are unable to obtain
sufficient funds from our subsidiaries to fund our obligations, our results of operations and financial
position could be materially and adversely affected.
Because we operate as a holding company, we are dependent upon dividends and administrative expense
reimbursements from some of our subsidiaries to fund our obligations. Many of these subsidiaries are regulated
by departments of insurance. We are also required by law or regulation to maintain specific prescribed minimum
amounts of capital in these subsidiaries. The levels of capitalization required depend primarily upon the volume
of premium revenues generated by the applicable subsidiary. A significant increase in premium volume will
require additional capitalization from us. In most states, we are required to seek prior approval by these state
regulatory authorities before we transfer money or pay dividends from these subsidiaries that exceed specified
amounts. An inability of our regulated subsidiaries to pay dividends to their parent companies in the desired
amounts or at the time of our choosing could adversely affect our ability to reinvest in our business through
capital expenditures or business acquisitions, as well as our ability to maintain our corporate quarterly dividend
payment cycle, repurchase shares of our common stock and repay our debt. If we are unable to obtain sufficient
funds from our subsidiaries to fund our obligations, our results of operations and financial position could be
materially and adversely affected.
Downgrades in our credit ratings, should they occur, may adversely affect our business, financial condition
and results of operations.
Claims paying ability, financial strength, and credit ratings by Nationally Recognized Statistical Rating
Organizations are important factors in establishing the competitive position of insurance companies. Ratings
information is broadly disseminated and generally used throughout the industry. We believe our claims paying
ability and financial strength ratings are important factors in marketing our products to certain of our customers.
Our credit ratings impact both the cost and availability of future borrowings. Each of the credit rating agencies
reviews its ratings periodically and there can be no assurance that current credit ratings will be maintained in the
future. Our ratings reflect each credit rating agency’s opinion of our financial strength, operating performance
and ability to meet our debt obligations or obligations to policyholders. Downgrades in our credit ratings, should
they occur, may adversely affect our results of operations, financial position and cash flows.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 2. PROPERTIES
To support our business operations in the United States and other countries we own and lease real properties. Our
various reportable segments use these facilities for their respective business purposes, and we believe these
current facilities are suitable for their respective uses and are adequate for our anticipated future needs.
ITEM 3. LEGAL PROCEEDINGS
See Note 12 of Notes to the Consolidated Financial Statements included in Item 8, “Financial Statements.”
ITEM 4. MINE SAFETY DISCLOSURES
N/A
34