That's $3 million per individual claim not in the aggregate... call me crazy, but its surprising to see a P&C insurer with over a third of its business in the state of Alabama up over 10% over the past couple months (this stock was ~$12 not that long ago) when in the interim this has happened. I guess we will have to sit back and wait to see how the claims come out and the next few quarters earnings look.
Not true, this is pulled from page 20 of the anual report.
Under the property and casualty subsidiaries reinsurance arrangement in force during 2010, the Company retained the first $3.5 million of insured losses from any single catastrophic event. The next $17.5 million in insured losses from any single event was 95% reinsured with the Company’s net retention being 5%. The third layer of reinsurance protection provided coverage for 100% of insured losses exceeding $17.5 million and up to $42.5 million. The fourth layer of reinsurance protection provided coverage for 100% of insured losses in excess of $42.5 million up to $72.5 million. The amount of catastrophe reinsurance protection purchased by the Company was based on computer modeling of actual Company exposure. The Company generally seeks catastrophe protection for scenarios based on the computer modeling that mitigates losses up to a near term 1 in 100 year event, further described as an amount at which the probability of not exceeding is not less than 99%. NSFC and Omega had a provision for one reinstatement (coverage for two catastrophic events) during 2010
The 3.5 million is for a single event, like the storms in Al.