Demotech Affirms Financial Stability Ratings® Assigned to Title Underwriters Based On Review of Second Quarter 2012 Data

Columbus, Ohio, October 5, 2012: Demotech, Inc. has affirmed the Financial Stability Ratings® (FSRs) assigned to Title underwriters based on a review of second quarter 2012 statutory financial information.  No FSR revisions were made following the review of this information.  The affirmation of the FSRs is based on a review of second quarter 2012 statutory financial information as well as a review of reinsurance agreements, agency appointment guidelines, agency review procedures and defalcation prevention procedures for each Title underwriter.

In its annual review of reinsurance arrangements, agency appointment guidelines, agency review procedures and defalcation prevention procedures for Title underwriters, Demotech found no material issues pertaining to established practices and procedures.  While, this is not a guarantee that no defalcations will occur, Title underwriters have documented processes and procedures in place to prevent and mitigate the impact from such events.

Douglas A. Powell, Senior Financial Analyst, stated, “Title underwriters continue to exhibit financial stability as they have maintained adequate levels of policyholders’ surplus while increasing direct premiums written period over period.  It is also worth noting that in the second quarter, aggregate underwriting results were positive.  This is the first time since 2007 the industry has reported a net underwriting gain on a year-to-date basis in consecutive quarters.”

FSRs are a leading indicator of the financial stability of Title underwriters and present Demotech’s opinion of the ability of an insurer to meet its insurance related obligations based upon an assessment of financial information.  FSRs are not an endorsement of any particular insurer or its products.  Insureds and agents need to independently evaluate their relationship with a particular insurer as well as the applicability of that insurer’s products to the needs of the insured or agent.

Visit www.demotech.com for a complete list of the FSRs assigned to Title underwriters.

About Demotech, Inc.

Demotech, Inc. is a financial analysis firm specializing in evaluating the financial stability of regional and specialty insurers.  Since 1985, Demotech has served the insurance industry by assigning accurate, reliable and proven Financial Stability Ratings® (FSRs) for Title underwriters and Property & Casualty insurers.  FSRs are a leading indicator of financial stability, providing an objective baseline of the future solvency of an insurer.  Demotech’s philosophy is to review and evaluate insurers based on their area of focus and execution of their business model rather than solely on financial size.  Visit www.demotech.com for more information.

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