Aon Study: Property & Casualty Earnings Volatility Lower in 2003 than 2002.CHICAGO -- Aon Corporation (NYSE NYSE See: New York Stock Exchange :AOC AOC, n an acronym for the Aromatherapy Organizations Council. ) announces today the results of its 2003 Property and Casualty Earnings Volatility Study that highlights the insurers and reinsurers that were most effective at minimizing earnings volatility. Consistent with the results from prior years, the Years, The the seven decades of Eleanor Pargiter’s life. [Br. Lit.: Benét, 1109] See : Time 2003 study indicates that solid underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. and effective capital management are the key drivers to more predictable earnings. The study measures earnings volatility on a cumulative basis over the one, two, three and five-year earnings periods ending December 31, 2003. The study includes more than 60 public companies within commercial lines, specialty lines, personal lines and reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. . "Once a year we want to recognize the companies that led their respective sectors in generating the least volatile earnings," said Michael Bungert, president of Aon Re Global, the world's largest reinsurance brokerage. "Research on this topic is limited in availability and we are pleased to have published our analysis on an annual basis over the past several years." The leaders and runners-up by sector and measurement period are as follows: 2003 P&C Earnings Volatility Study Results
One Year Two Year Three Year Five Year
Period Period Period Period
---------- ------------- --------- -------------
Commercial Lines:
Least Volatile ACE Hartford Old Republic AIG
Runner-up AIG AIG AIG Old Republic
Specialty Lines:
Least Volatile RLI Baldwin & Lyons RLI RLI
Runner-up United RLI HCC HCC
Fire &
Casualty
Personal Lines:
Mercury
Least Volatile General ALFA ALFA ALFA
Runner-up Direct
General Erie Erie Erie
Reinsurance:
Least Volatile Montpelier Re IPC Re IPC Re Everest Re
Runner-up Everest Re RenaissanceRe Everest Re Transatlantic Re
On a year-over-year basis, earnings volatility for all of the companies included in our study, on average, was 18% lower than 2002. Earnings reflected solid underwriting results stemming from prior rate increases and only marginally higher catastrophe losses. On a relative basis, earnings volatility in 2003 was the lowest in personal lines in three of the four measurement periods compared with the other sectors, consistent with the results published last year.
2003 Sector Volatility Study Results
One Year Two Year Three Year Five Year
Period Period Period Period
----------- ----------- ----------- -----------
Personal Reinsurance Personal Personal
Least Volatile Lines Lines Lines
Personal Commercial Commercial
1st Runner-up Reinsurance Lines Lines Lines
Specialty Specialty Specialty
2nd Runner-up Lines Lines Lines Reinsurance
Commercial Commercial Specialty
Most Volatile Lines Lines Reinsurance Lines
The 2003 study also included, for the first time, rankings based on return on equity (ROE A fictitious surname used for an unknown or anonymous person or for a hypothetical person in an illustration. A lawsuit is generally named for the persons who are parties to it. ). Over 90% of this year's leaders and runners-up also placed in the top half of the ROE rankings for their respective sectors. The weighted average ROE for all of the insurers and reinsurers in the 2003 study improved to 10.9% from 6.5% in 2002 and 3.5% in 2001.
2003 Sector ROE Volatility Study Results
2003 2002 2001 2000 1999
----- ----- ----- ----- ------
Commercial Lines 9.7% 7.3% 3.5% 12.8% 11.5%
Specialty Lines 14.4% 7.3% 3.4% 1.1% 6.5%
Personal Lines 6.5% 3.9% 9.6% 13.8% 16.3%
Reinsurance 13.1% 7.6% -2.7% 6.4% 3.3%
All Companies 10.9% 6.5% 3.5% 8.5% 9.4%
Aon Re Global provides traditional, alternative risk transfer and capital markets-based reinsurance advisory and execution services to insurers and reinsurers. Client advisory services advisory services advisory services provided to the public, in their capacity as owners and managers of animals, are an important part of veterinary science. They may be provided by government bureaux, by commercial companies who deal in pharmaceuticals or animals or animal include rating agency capital modeling assistance, capital allocation and optimization optimization Field of applied mathematics whose principles and methods are used to solve quantitative problems in disciplines including physics, biology, engineering, and economics. services, catastrophe modeling
Aon Corporation (www.aon.com) is a leading provider of risk management services, insurance and reinsurance brokerage, human capital and management consulting Noun 1. management consulting - a service industry that provides advice to those in charge of running a business service industry - an industry that provides services rather than tangible objects , and specialty insurance underwriting. The company employs approximately 53,000 professionals in its 600 offices in more than 120 countries. Backed by broad resources, industry knowledge and technical expertise, Aon professionals help a wide range of clients develop effective risk management and workforce productivity solutions. This press release contains certain statements relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc future results, which are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. as that term is defined in the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from either historical or anticipated results, depending on a variety of factors. Potential factors that could impact results include the general economic conditions in different countries around the world, fluctuations in global equity and fixed income markets, exchange rates, rating agency actions, resolution of regulatory issues, pension funding, ultimate paid claims may be different from actuarial ac·tu·ar·y n. pl. ac·tu·ar·ies A statistician who computes insurance risks and premiums. [Latin estimates and actuarial estimates may change over time, changes in commercial property and casualty markets and commercial premium rates, the competitive environment, the actual costs of resolution of contingent liabilities Contingent Liability 1. The possibility of an obligation to pay certain sums dependent on future events. 2. Defined obligations by a company that must be met, but the probability of payment is minimal. Notes: 1. and other loss contingencies, the heightened level of potential errors and omissions errors and omissions n. short-hand for malpractice insurance which gives physicians, attorneys, architects, accountants and other professionals coverage for claims by patients and clients for alleged professional errors and omissions which amount to negligence. liability arising from placements of complex policies and sophisticated reinsurance arrangements in an insurance market in which insurer reserves are under pressure, and the timing and resolution of related insurance and reinsurance issues relating to the events of September 11, 2001. Further information concerning the Company and its business, including factors that potentially could materially affect the Company's financial results, is contained in the Company's filings with the Securities and Exchange Commission. |
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