Minnesota Lawyers Mutual Insurance Company and Subsidiaries - Page 31




                                                -31-                                                   
                  Streff determined a reasonable range of deviation extending                          
            from $570,000 below to $1,140,000 above his most likely reserve                            
            estimates.                                                                                 
                  As part of his report, Streff “restated” petitioner’s                                
            carried reserves for each year of its history by considering                               
            subsequent payments and changing reserve levels for successive                             
            years through 1995.  According to this analysis, petitioner’s                              
            initial reserves for each of the years 1982 through 1985, were                             
            lower than their restatement in 1995, whereas petitioner’s                                 
            initial reserves for each of the years 1987 through 1994 were 27                           
            to 52 percent higher than their restatement in 1995.23                                     



                  23 Streff’s expert report indicates that on the basis of                             
            information in petitioner’s annual statements, petitioner’s                                
            “restated” reserves as of Dec. 31, 1995, and the resulting                                 
            deficiency or redundancy in the initial booked reserve, were as                            
            follows (in millions of dollars):                                                          
                                    Original          1995        Deficiency                           
                        Year        Reserve   Restatement    (Redundancy)                              
                        1982        $105        $302            $197                                   
                        1983         498         1,397           899                                   
                        1984        1,245             2,320       1,075                                
                        1985       2,138         2,961                  823                            
                        1986        4,323             2,792             (1,531)                        
                        1987        5,557             3,116             (2,441)                        
                        1988        5,989             4,388             (1,601)                        
                        1989        7,837             5,165             (2,672)                        
                        1990        9,618             4,656             (4,962)                        
                        1991      10,127              4,954             (5,173)                        
                        1992      10,550              5,577             (4,973)                        
                        1993      11,636              6,953             (4,683)                        
                        1994      11,581              7,885          (3,696)                           
                        1995      12,500        12,500                                                 





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