It boggles the mind how with the huge underwriting profit and investment income, the combined entity can take a loss- get a tax write off and still collect interest income on their billions in the reserve account. If I thought games were being played by insurance companies and their accounting practices, no I question how they were able to catch the SEC off guard. What a business!
This is what used to be known as a shell game. I remember when Travelers completed its first anniversary after the acquisition of Aetna C&S, Travelers released hundreds of millions of dollars of reserves associated with the former Aetna. Think of all of the agents that got screwed out of their profit sharing while this money was incognito. Think of Sandy Weill’s pocket bulging, and the stock price soaring based on over-reserving. (Who benefited from the soaring stock price?)
St. Paul & the Travelers was set up along time ago by Weill and Fishman; mainly for Weill to divest of P&C because it is too cyclical, therefore potentially a drag on Citigroup’s performance and subsequentially his paycheck/performance bonus.
What is truely amazing is that the N.Y. Dept. of Insurance with all of their so called checks and balances to protect the “consumer” did not step in to address how the reserver should be handled in accordance with THEIR guidlines.
One must truely wonder just who the DOI really is looking our for. I would appear that the poor unsuspecting insurance buying public is merely at the mercy of the goliath insurance companies.
Way to go DOI. I wonder if they ever have any illfellings when they cash their paychecks?
All of this sounds like business as usual……but what of the 3000+ people that will be laid off due to the merger, or the demise of Gulf Insurance Group?
Then again, look at what happened to Aetna when they merged. See you at McElroy’s :)
WC Fraud is rampant in Travelers that handles all the Carl’s Jr. in Calif ( CKE Santa Barbara). that employ’s 20% undocumented workers, 20% of all Carl’s Jr. workers or out on WC claims
It boggles the mind how with the huge underwriting profit and investment income, the combined entity can take a loss- get a tax write off and still collect interest income on their billions in the reserve account. If I thought games were being played by insurance companies and their accounting practices, no I question how they were able to catch the SEC off guard. What a business!
It’s unbelievable that any sort of due diligence would’nt expose $1.5BB of reserving difference.
Looks like someone should take the fall for the damage to Travelers shareholders. Not to mention the windfall to St. Paul shareholders.
Could there be a Class Action in the offing?
This is what used to be known as a shell game. I remember when Travelers completed its first anniversary after the acquisition of Aetna C&S, Travelers released hundreds of millions of dollars of reserves associated with the former Aetna. Think of all of the agents that got screwed out of their profit sharing while this money was incognito. Think of Sandy Weill’s pocket bulging, and the stock price soaring based on over-reserving. (Who benefited from the soaring stock price?)
St. Paul & the Travelers was set up along time ago by Weill and Fishman; mainly for Weill to divest of P&C because it is too cyclical, therefore potentially a drag on Citigroup’s performance and subsequentially his paycheck/performance bonus.
You guys are too cynical. The business of America is business. Tom is the only one I agree with.
What is truely amazing is that the N.Y. Dept. of Insurance with all of their so called checks and balances to protect the “consumer” did not step in to address how the reserver should be handled in accordance with THEIR guidlines.
One must truely wonder just who the DOI really is looking our for. I would appear that the poor unsuspecting insurance buying public is merely at the mercy of the goliath insurance companies.
Way to go DOI. I wonder if they ever have any illfellings when they cash their paychecks?
Travelers is domiciled in CT and St. Paul is domiciled in MN, the NY Department of Insurance was not a driver on this trip, they were a passenger.
All of this sounds like business as usual……but what of the 3000+ people that will be laid off due to the merger, or the demise of Gulf Insurance Group?
Then again, look at what happened to Aetna when they merged. See you at McElroy’s :)
WC Fraud is rampant in Travelers that handles all the Carl’s Jr. in Calif ( CKE Santa Barbara). that employ’s 20% undocumented workers, 20% of all Carl’s Jr. workers or out on WC claims