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The Beacon Mutual Insurance Company in Rhode Island announced that it realized $27.5 million in net income for calendar year 2005, a figure that exceeded management’s expectations.
Management credited its ability to use its own state-specific data in its rates for the results.
The performance allowed for a declared policyholder dividend totaling $26 million for 2005.
The company presently has a rate filing pending before state regulators for a 27 percent reduction in average loss costs.
“Our net income figures result from recognition from the actuarial
community to accept Beacon’s own data developed over the past 10 years, as opposed to the industry data which we have been required to use in past calculations,” said Joseph A. Solomon, president and chief executive officer. “The company has matured to a point where our outside actuarial firm has relied upon the good experience of Beacon’s policyholders instead of national insurance industry experience to determine future trends and claims, which have resulted in a one time adjustment to year end 2005 loss and expense reserves.”
For the first time in the company’s history, insurance rating agency A.M. Best will begin rating Beacon this year. Solomon said any accrued surplus will assist the company in achieving a favorable rating.
Source: Beacon Mutual