Insurers focus on specialty markets. (E-Fusion Conference: Retail; Technology).The best performing property/casualty insurers are niche companies focused on a specific geographic area, target customer or channel, said Bill Pieroni, general manager of IBM's global insurance industry segment. IBM (International Business Machines Corporation, Armonk, NY, www.ibm.com) The world's largest computer company. IBM's product lines include the S/390 mainframes (zSeries), AS/400 midrange business systems (iSeries), RS/6000 workstations and servers (pSeries), Intel-based servers (xSeries) studied the largest 75 property/casualty insurers--which included the top 50 commercial and personal lines writers--and found that only 13 managed to produce better returns than the Standard & Poor's 500 average while posting an underwriting profit Underwriting profit is a term used in the insurance industry. It consists of the earned premium remaining after losses have been paid and administrative expenses have been deducted. It does not include any investment income earned on held premiums. from 1987 to 2001. "The companies aren't the largest, but they have scale and scope economies," he said. Those companies, including eight public and five reciprocal or mutual-companies, succeeded by knowing what their market is, Pieroni said. Each operates in a niche of some sort where they know the market better than their competitors, Pieroni said. For instance, Commerce mostly writes auto insurance in Massachusetts. New Jersey Manufacturers mostly writes auto in New Jersey and California State Auto writes in California. Mortgage Guaranty As a verb, to agree to be responsible for the payment of another's debt or the performance of another's duty, liability, or obligation if that person does not perform as he or she is legally obligated to do; to assume the responsibility of a guarantor; to warrant. underwrites mortgage insurance, Horace Mann targets teachers and USAA USAA United Services Automobile Association USAA Urban Superintendents Association of America USAA United States Achievement Academy USAA United States Arbitration Act of 1925 USAA United States Axemen's Association USAA United States Air-Table-Hockey Association exclusively writes for military personnel. While the companies maintained an underwriting profit, they tended to have slightly higher costs for acquiring policies than their competitors due to stricter 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. standards. However, they tended to stay away from unprofitable business, and even tried to send unprofitable business to their competitors. The Sweet 13 Thirteen companies that outshined the Standard & Poor's 500 average, 1987-2001: * Amica Mutual * Mercury General * AAA AAA: see American Automobile Association. (Triple A) A common single-cell battery used in a myriad of electronic devices of all variety. Like its double A (AA) cousin, it provides 1.5 volts of DC power. When used in series, the voltage is multiplied. Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, * Mortgage Guaranty * California State Auto * New Jersey Manufacturers * Commerce * Old Republic General * GE Financial * Progressive * Geico * USAA * Horace Mann Source: Bill Pieroni, general manager of IBM's global insurance industry segment. |
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