1041665--3/13/2006--PMA_CAPITAL

related topics

{loss, insurance, financial}

{debt, indebtedness, cash}

{capital, credit, financial}

{competitive, industry, competition}

{tax, income, asset}

{financial, litigation, operation}

{condition, economic, financial}

{loan, real, estate}

{acquisition, growth, future}

{investment, property, distribution}

{provision, law, control}

{customer, product, revenue}

{operation, natural, condition}

{product, liability, claim}

{personnel, key, retain}

Reserves are estimates and do not and cannot represent an exact measure of liability. If our actual losses from insureds exceed our loss reserves, our financial results would be adversely affected. We have recorded significant reserve charges in the past and if we experience additional significant reserve charges it could adversely affect our ability to continue in the ordinary course of our business. Because insurance ratings, particularly from A.M. Best, are important to our policyholders, downgrades in our ratings may adversely affect us. The Pennsylvania Insurance Department s restriction on the declaration and payment of dividends from PMA Capital Insurance Company could adversely affect our ability to meet our obligations. We may not have sufficient funds to satisfy our obligations under our indebtedness and our other financial obligations. The indentures governing our indebtedness restrict our ability to engage in certain activities. Because credit ratings are important to our creditors, downgrades in our credit ratings may adversely affect us. Our reserves for asbestos and environmental claims may be insufficient. The effects of emerging claims and coverage issues on our business are uncertain. We rely on independent agents and brokers and therefore we are exposed to certain risks. Our failure to realize our deferred income tax asset could lead to a writedown, which could adversely affect our results of operations and financial position. We face a risk of non-collectibility of reinsurance, which could materially affect our results of operations Because we are heavily regulated by the states in which we do business, we may be limited in the way we operate. Our results may fluctuate as a result of many factors, including cyclical changes in the insurance industry. We operate in a highly competitive industry which makes it more difficult to attract and retain new business. Because our investment portfolio is primarily fixed-income securities, the fair value of our investment portfolio and our investment income could suffer as a result of fluctuations in interest rates. Our business is dependent upon our key executives, certain of whom do not have employment agreements with restrictive covenants and can leave our employment at any time. We have exposure to catastrophic events, which can materially affect our financial results. We face a risk of non-availability of reinsurance, which could materially affect our ability to write business and our results of operations. Purported class action lawsuits may result in financial losses and may divert management resources. In addition, we are subject to litigation in the ordinary course of our business. We may require additional capital in the future, which may not be available or may be available only on unfavorable terms. We are an insurance holding company with no direct operations. Statutory requirements governing dividends from our principal operating subsidiaries could adversely affect our ability to meet our obligations. Provisions in our charter documents may impede attempts to replace or remove our current directors with directors favored by shareholders.

Full 10-K form ▸

1041665--3/13/2006--PMA_CAPITAL_CORP