NEW YORK (TheStreet) - Among a published ranking of companies with the strongest operating insurance subsidiaries, several bank holding companies stand out.
SNL Financial's statutory insurance performance rankings for public companies includes Bank of America and Wells Fargo among the top 10, along with Triton Insurance, which is a subsidiary of Citigroup.
The list is based on the consolidated first-quarter 2010 statutory filings from which SNL ranked financial performance of insurance units using weighted performance metrics, with the greatest emphasis on earnings and underwriting profitability.
SNL stressed that only companies making statutory filings with the National Association of Insurance Commissioners (NAIC) were included. In order to keep the numbers from being distorted by the credit crisis, financial guaranty insurance companies were excluded. Since New Jersey companies aren't required by state regulators to file quarterly statutory statements, these companies were also excluded.
Companies with insurance subsidiaries providing force-placed property insurance were at the top of the list. These included Assurant Inc. and Bank of America. Forced-placed insurance policies are those that lenders or loan servicers arrange when they are unable to obtain proof of insurance for collateral properties.
Although most residential first-mortgage loans are escrowed for insurance, with the lender or servicer collecting money each month to put toward annual insurance premiums, this practice is less common for commercial real estate loans. Loan servicers also track insurance coverage for second mortgages and home equity lines, and will often place insurance coverage -- charging borrowers for the privilege -- if annual proof of adequate insurance coverage for the entire property value isn't received.
The commercial property insurance businesses of American Financial Group and Wells Fargo placed these companies among the top 10.
The following are SNL Financial's top ten public entities, based on the combined first-quarter performance of their insurance subsidiaries. The subsidiary data SNL used came from the individual insurance companies' statutory financial statements filed with the NAIC: