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W. R. Berkley Annual Report (Amendment), Year Ended Dec 31, 2002

Filing Date
Filed April 4, 2003
Period End
December 31, 2002
In the record · 2016–202610-K1110-Q338-K96

WRB filed 11 annual reports (10-K), 33 quarterly reports (10-Q) and 96 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Mar ’18Mar ’18
  2. Leadership change8-K · Dec ’20Dec ’20
  3. Leadership change8-K · Dec ’22Dec ’22
  4. FY2024 annual report10-K · Feb ’25Feb ’25

01—Abstract

Summary

Summary of the 10-K/A filed April 4, 2003. Cited figures are marked; the original filing is the authoritative source.

W.

R. Berkley Corporation's Form 10-K/A (Amendment No. 1) for fiscal year ended December 31, 2002, filed April 4, 2003, was filed solely to delete an incomplete sentence in the risk factor captioned "As a property casualty insurer, we face losses from natural and man-made catastrophes" and to restate Item 1 in its entirety. The company is an insurance holding company operating in five property casualty segments: specialty, alternative markets, reinsurance, regional, and international.

Net premiums written rose to $2.71 billiona in 2002 from $1.86 billion in 2001, with specialty insurance ($861.7 million), reinsurance ($680.2 million), and regional ($776.6 million) as the largest contributors. Segment pre-tax income in 2002 was $130.5 million for specialty, $65.6 million for alternative markets, $39.3 million for reinsurance, $111.8 million for regional, and $7.7 million for international, against a discontinued business pre-tax loss of $10.7 million. The filing reports a total combined ratio of 95.4% for 2002, compared with 116.5% in 2001, with the loss ratio at 65.0% and the expense ratio at 30.4%.

Net reserves for losses and loss adjustment expenses were $2.32 billionb at December 31, 2002, up from $2.03 billion a year earlier. The filing also notes that investment income before expenses was $210.9 million on average investments of $3.88 billion, and that in the first quarter of 2003 the company issued $200 million of ten-year 5.875% senior notes and repaid $61 million of maturing debt. Management also disclosed plans to form a U.K. authorized insurance company expected to begin operating in the third quarter of 2003.

The filing's risk factors emphasize cyclicality, reserve adequacy (including exposure to the World Trade Center attack, the Enron bankruptcy, and asbestos and environmental claims), increased retention levels, catastrophe exposure, reinsurance availability and counterparty risk, and dependence on dividends from insurance subsidiaries. The company's stated A.M. Best ratings are A (Excellent) for most domestic insurers and A+ (Superior) for Admiral Insurance Company.

02—Key points

Key Highlights

  1. Net premiums written reached $2.71 billion in 2002, up from $1.86 billion in 2001.
  2. Total combined ratio improved to 95.4% in 2002 from 116.5% in 2001, with the loss ratio at 65.0% versus 82.1%.
  3. Specialty insurance pre-tax income was $130.5 million in 2002, compared with $28.8 million in 2001.
  4. Regional insurance pre-tax income was $111.8 million in 2002, compared with $44.4 million in 2001.
  5. Net reserves for losses and loss adjustment expenses were $2.32 billion at December 31, 2002, up from $2.03 billion at year-end 2001.
  6. In Q1 2003 the company issued $200 million of ten-year 5.875% senior notes and repaid $61 million of maturing debt.
  7. The company plans to form a London-based U.K. authorized insurer expected to commence operations in the third quarter of 2003, subject to approvals.

03—Questions

Frequently Asked Questions

  1. Why was this 10-K/A filed?

    Amendment No. 1 was filed solely to delete an incomplete sentence inadvertently included in the catastrophe-loss risk factor of the initial Form 10-K. Item 1 was restated in its entirety.

  2. How did underwriting profitability change in 2002?

    The total combined ratio, which excludes investment income, was 95.4% in 2002 versus 116.5% in 2001, where a number below 100 indicates an underwriting profit. The loss ratio fell to 65.0% from 82.1%, and the expense ratio fell to 30.4% from 34.4%.

  3. Which segments drove the premium growth?

    Net premiums written increased in most segments. Specialty insurance rose to $861.7 million from $527.5 million, reinsurance to $680.2 million from $236.8 million, and alternative markets to $305.4 million from $151.9 million. Regional premiums rose to $776.6 million from $598.1 million, while international fell to $79.3 million from $150.1 million.

  4. What are the main risks the filing highlights?

    The filing cites cyclical industry results, the adequacy of loss reserves (including exposure to the World Trade Center attack, the Enron bankruptcy, and asbestos and environmental claims), higher retention levels, catastrophe losses, the availability and cost of reinsurance, terrorism exposure, credit risk from reinsurers, and political and economic risks in Argentina and the Philippines.

  5. What financing and strategic actions were disclosed as recent developments?

    In March 2003 the company announced plans to form a U.K. authorized insurance company, expected to be London-based and focused on U.K. domestic casualty risks. In the first quarter of 2003 it issued $200 million of ten-year 5.875% senior notes and repaid $61 million of maturing debt.

04—Continue

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