Alabama-based Vesta Insurance Group Inc. announced that the panel in its arbitration with NRMA Insurance Ltd. has ruled in favor of NRMA in the 20 percent whole account quota share reinsurance dispute.
As a result, Vesta will incur approximately a $33.5 million charge to 2003 fourth quarter earnings. Vesta is currently evaluating other potential financial implications of this ruling, including its impact on the remaining 20 percent whole account quota share arbitration recoverables and the recoverability of its deferred tax asset and goodwill.
“We vehemently disagree with the panel’s final ruling and we are evaluating all remaining legal options to fight this decision,” said Norman Gayle III, president and CEO. “Excluding the financial implications of this ruling, we expect to report positive income from continuing operations for the fourth quarter and full-year,” added Gayle.
Vesta is a holding company for a group of insurance and financial services companies that offer a wide range of consumer-based products.
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