Mergers and acquisitions drove 1995 corporate changes

Article Abstract:

Merger and acquisition activity in the health and life insurance industry increased in 1995 due to increased competition and changes in the health care environment. Low interest rates and increased financing contributed to 4% premium growth in the life/health insurance industry in 1995. Sixty-five insurance companies were retired in 1995 compared to 37 companies in 1994, according to data collected by A.M. Best Co. Uncertainties about health care reform, changing demographics and potential tax reforms on nonqualified products are expected to place pressure life and health insurers in 1996.

Mergers, acquisitions and divestments, Health insurance industry

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Rates, sleeker structures help to set record net

Article Abstract:

Financial results among life and health insurers improved during 1995. Industry-wide net income rose by more than a third over 1994 figures to $15.59 billion. Realized capitalized losses were 15% lower than in 1994, totalling $1.58 billion. The improved results were attributed to product streamlining, expense reduction, declining interest rates, and improved interest-rate risk management, among other factors.

Finance

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Persistency improves, ratios lowest in 20 years

Article Abstract:

Lapse ratios in 1994 decreased to 8.3% following an improvement trend that had been evident since 1984, except for minor increases in 1990 and 1993. Better underwriting practices, better market research, product mix changes and greater sophisticated market involvement have aided this lapse ratio improvement trend. Persistency is measured by the lapse ratio statistic.

Management

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• Abstracts: Life/health insurers' profits surged 31% in 1995. Underwriting losses took a steep downturn. Issued and in-force rise, policy counts grow 0.02%

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