1162000--3/28/2007--FUND_AMERICAN_CO

related topics

{debt, indebtedness, cash}

{operation, natural, condition}

{regulation, change, law}

{acquisition, growth, future}

{loss, insurance, financial}

{financial, litigation, operation}

{loan, real, estate}

{regulation, government, change}

{condition, economic, financial}

{capital, credit, financial}

{personnel, key, retain}

{competitive, industry, competition}

{product, liability, claim}

Risks Relating to Our Business Our loss and loss adjustment expense reserves may be inadequate to cover our ultimate liability for losses and as a result any inadequacy could materially adversely affect our financial condition and results of operations. Exposure to asbestos or environmental claims could materially adversely affect our financial condition and results of operations. We may not be able to successfully alleviate risk through reinsurance arrangements. Additionally, we may be unable to collect all amounts due from our reinsurers under our existing reinsurance arrangements. Unpredictable catastrophic events could adversely affect our financial condition or results of operations. Future insurance and reinsurance coverage for terrorist acts is uncertain, and we may in the future have substantial exposure to such acts. Our investment portfolio may suffer reduced returns or losses which could adversely affect our results of operations and financial condition. Any increase in interest rates or volatility in the equity and debt markets could result in significant losses in the fair value of our investment portfolio. We may not maintain favorable financial strength ratings, which could adversely affect our ability to conduct business. Our debt, preferred stock and related service obligations could adversely affect our financial condition and results of operations. We are a holding company with no direct operations, and our insurance subsidiaries ability to pay dividends to us is restricted by law. The property and casualty insurance industry is highly competitive and we may not be able to compete effectively in the future. We may suffer losses from unfavorable outcomes from litigation and other legal proceedings. Our profitability may be adversely impacted by inflation and legislative actions and judicial decisions. Regulation may restrict our ability to operate. Government authorities are continuing to investigate the insurance industry, which may adversely affect our business. We may be unable to collect amounts utilized to capitalize reciprocals. A failure to attract and retain key personnel could reduce our revenues and operational effectiveness. Our written premiums are heavily concentrated in the Northeastern United States. Mandated market mechanisms may require us to underwrite policies with a higher risk of loss and assessments and other surcharges for guaranty funds and second-injury funds may reduce our profitability. Cyclicality of the property and casualty insurance industry may cause fluctuations in our results of operations and financial condition. We may need additional capital in the future, which may not be available to us or available to us on favorable terms. Risks Relating to Our Relationship with White Mountains Transitional and other arrangements with White Mountains may not be on arm s length terms. Refinancing of our senior notes may occur on unfavorable terms.

Full 10-K form ▸

1162000--3/28/2007--FUND_AMERICAN_CO_INC/NEW