Attached files
| file | filename |
|---|---|
| EX-99.2 - EXHIBIT - PROASSURANCE CORP | postannualmtg2014.htm |
| 8-K - 8-K - PROASSURANCE CORP | a2014postboardmeeting8k.htm |
NEWS RELEASE 
For More Information Contact: |
Frank B. O’Neil |
Sr. Vice-President, Corporate Communications & Investor Relations |
800.282.6242 • 205.877.4461 • foneil@ProAssurance.com |
ProAssurance Declares Regular Dividend and Adds to Share Repurchase Authorization
BIRMINGHAM, AL – (PRNewswire) – May 28, 2014 – ProAssurance Corporation (NYSE: PRA) announced today that the Board of Directors has declared a cash dividend of $0.30 per common share, payable on July 11, 2014 to shareholders who own our stock as of June 27, 2014. The Board also authorized an additional $100 million to be used for share repurchase or debt retirement. This brings the outstanding authorization to $202 million as of May 27, 2014.
“With this increase in our share repurchase authorization we are affirming the importance of share repurchase in our overall capital management strategy. Through May 27, 2014, this year’s repurchases total
2.2 million shares at a cost of approximately $100.6 million and, since January 1, 2007, we have repurchased 15.1 million shares, including the effect of our December, 2012 two-for-one stock split, at a cost of $453.7 million. We continually and carefully evaluate our capital management strategy to ensure that we are enhancing shareholder value while maintaining a level of capital that allows us to fund operations, address possible risks and pursue future growth opportunities,” said ProAssurance Chairman and Chief Executive Officer W. Stancil Starnes.
Our dividend policy anticipates a total annual dividend of $1.20 per share, to be paid in equal quarterly installments. However, any decision to pay future cash dividends will be subject to the Board’s final determination after a comprehensive review of the company’s financial performance, future expectations and other factors deemed relevant by the Board.
The company expects to continue deploying the funds in the share repurchase authorization over the near term, but purchases will depend on financial market conditions as well as the company’s view of its future capital needs. Any share repurchase will be subject to the rules of the New York Stock Exchange and applicable securities laws and regulations, including Rule 10b5-1 and Rule 10b-18 under the Securities Exchange Act of 1934, as amended. There can be no guarantee that any shares will be repurchased by ProAssurance either through the Plan or otherwise.
About ProAssurance
ProAssurance Corporation is an industry-leading specialty insurer with extensive expertise in healthcare professional liability, products liability for medical technology and life sciences, legal professional liability, and workers’ compensation insurance. ProAssurance is recognized as one of the top performing insurance companies in America by virtue of our inclusion in the Ward’s 50 for the past seven years. ProAssurance Group is rated “A+” (Superior) by A.M. Best and ProAssurance is rated “A” (Strong) by Fitch Ratings.
Caution Regarding Forward-Looking Statements
Statements in this news release that are not historical fact or that convey our view of future business, events or trends are specifically identified as forward-looking statements. Forward-looking statements are based upon our estimates and anticipation of future events and highlight certain risks and uncertainties that could cause actual results to vary materially from our expected results. We expressly claim the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, for any forward-looking statements in this news release. Forward-looking statements represent our outlook only as of the date of this news release. Except as required by law or regulation, we do not undertake and specifically decline any obligation to publicly release the result of any revisions that may be
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made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.
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Forward-looking statements are generally identified by words such as, but not limited to, “anticipate,” “believe,” “estimate,” “expect,” “hope,” “hopeful,” “intend,” “likely,” “may,” “optimistic,” “possible,” “potential,” “preliminary,” “project,” “should,” “will,” and other analogous expressions. When we address topics such as liquidity and capital requirements, the value of our investments, return on equity, financial ratios, net income, premiums, losses and loss reserves, premium rates and retention of current business, competition and market conditions, the expansion of product lines, the development or acquisition of business in new geographical areas, the availability of acceptable reinsurance, actions by regulators and rating agencies, court actions, legislative actions, payment or performance of obligations under indebtedness, payment of dividends, and other similar matters, we are making forward-looking statements.
These forward-looking statements are subject to significant risks, assumptions and uncertainties, including, among other things, the following factors that could affect the actual outcome of future events:
• | changes in general economic conditions, including the impact of inflation or deflation and unemployment; |
• | our ability to maintain our dividend payments; |
• | regulatory, legislative and judicial actions or decisions that could affect our business plans or operations; |
• | the enactment or repeal of tort reforms; |
• | formation or dissolution of state-sponsored medical professional liability insurance entities that could remove or add sizable groups of physicians from or to the private insurance market; |
• | changes in the interest rate environment; |
• | changes in U.S. laws or government regulations regarding financial markets or market activity that may affect the U.S. economy and our business; |
• | changes in the ability of the U.S. government to meet its obligations that may affect the U.S. economy and our business; |
• | performance of financial markets affecting the fair value of our investments or making it difficult to determine the value of our investments; |
• | changes in requirements or accounting policies and practices that may be adopted by our regulatory agencies, the Financial Accounting Standards Board, the Securities and Exchange Commission (SEC), the Public Company Accounting Oversight Board, or the New York Stock Exchange (NYSE) and that may affect our business; |
• | changes in laws or government regulations affecting the financial services industry, the property and casualty insurance industry or particular insurance lines underwritten by our subsidiaries; |
• | the effects of changes in the healthcare delivery system, including but not limited to the Patient Protection and Affordable Care Act (the Healthcare Reform Act); |
• | consolidation of healthcare providers resulting in entities that are more likely to self insure a substantial portion of their healthcare professional liability risk; |
• | uncertainties inherent in the estimate of loss and loss adjustment expense reserves and reinsurance; |
• | changes in the availability, cost, quality or collectability of insurance/reinsurance; |
• | the results of litigation, including pre- or post-trial motions, trials and/or appeals we undertake; |
• | allegations of bad faith which may arise from our handling of any particular claim, including failure to settle; |
• | loss or consolidation of independent agents, agencies, brokers or brokerage firms; |
• | changes in our organization, compensation and benefit plans; |
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• | changes in the business or competitive environment may limit the effectiveness of our business strategy and impact our revenues; |
• | our ability to retain and recruit senior management; |
• | the availability, integrity and security of our technology infrastructure; |
• | the impact of a catastrophic event, as it relates to both our operations and our insured risks; |
• | the impact of acts of terrorism and acts of war; |
• | the effects of terrorism related insurance legislation and law; |
• | assessments from guaranty funds; |
• | our ability to achieve continued growth through expansion into other states or through acquisitions or business combinations; |
• | changes to the ratings assigned by rating agencies to our insurance subsidiaries, individually or as a group; |
• | provisions in our charter documents, Delaware law and state insurance laws may impede attempts to replace or remove management or may impede a takeover; |
• | state insurance restrictions may prohibit assets held by our insurance subsidiaries, including cash and investment securities, from being used for general corporate purposes; |
• | taxing authorities can take exception to our tax positions and cause us to incur significant amounts of legal and accounting costs and, if our defense is not successful, additional tax costs, including interest and penalties; and |
• | expected benefits from completed and proposed acquisitions may not be achieved or may be delayed longer than expected due to business disruption; loss of customers, employees and key agents; increased operating costs or inability to achieve cost savings; and assumption of greater than expected liabilities, among other reasons. |
Additional risks that could adversely affect the integration of Eastern Insurance Holdings, Inc. (Eastern) into ProAssurance, include, but are not limited to, the following:
• | the operations of ProAssurance and Eastern may not be integrated successfully, or such integration may take longer to accomplish than expected; and |
• | operating costs, customer loss and business disruption following the transaction, including adverse effects on relationships with employees, may be greater than expected. |
Additional risks that could arise from our membership in the Lloyd’s of London market (Lloyd’s) and our participation in Syndicate 1729 include, but are not limited to, the following:
• | members of Lloyd's are subject to levies by the Council of Lloyd's based on a percentage of the member's underwriting capacity, currently a maximum of 3%, but can be increased Lloyd's; |
• | Syndicate operating results can be affected by decisions made by the Council of Lloyd's over which the management of Syndicate 1729 has little ability to control, such as a decision to not approve the business plan of the Syndicate, or a decision to increase the capital required to continued operations, and by our obligation to pay levies to Lloyd's; |
• | Lloyd's insurance and reinsurance relationships and distribution channels could be disrupted or Lloyd's trading licenses could be revoked making it more difficult for Syndicate 1729 to distribute and market its products; and |
• | rating agencies could downgrade their ratings of Lloyd's as a whole. |
Our results may differ materially from those we expect and discuss in any forward-looking statements. The principal risk factors that may cause these differences are described in “Item 1A, Risk Factors” in our Form 10-K and other documents we file with the Securities and Exchange Commission, such as our current reports on Form 8-K, and our regular reports on Form 10-Q.
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We caution readers not to place undue reliance on any such forward-looking statements, which are based upon conditions existing only as of the date made, and advise readers that these factors could affect our financial performance and could cause actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements. Except as required by law or regulations, we do not undertake and specifically decline any obligation to publicly release the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.
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