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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934.
For the Quarterly period ended September 30, 2002.
[_] Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934.
For the transition period from ____________________ to ___________________.
Commission file number 000-28249
AMERINST INSURANCE GROUP, LTD.
------------------------------
(Exact Name of Registrant as Specified in its Charter)
BERMUDA 98-020-7447
(State or other jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization) (Identification No.)
C/O USA Offshore Management, Windsor Place, (Zip Code)
18 Queen Street, 2nd Floor,
PO Box HM 1601, Hamilton HM GX, Bermuda
Registrant's telephone number, including area code: (441) 296-3973
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.
[X] YES [_] NO
Number of shares of common stock outstanding:
Number outstanding
Class as of November 4, 2002
----- ------------------
COMMON SHARES, PAR VALUE $1.00 PER SHARE 307,711
Part I, Item 1
AMERINST INSURANCE GROUP, LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
As of As of
September 30, December 31,
ASSETS 2002 2001
------------ ------------
INVESTMENTS
Fixed maturity investments, at market value (amortized
cost $30,827,892 and $28,529,843) ...................... $32,561,996 $29,529,239
Equity securities, at market value (cost $14,498,479
and $13,972,736) ....................................... 13,154,476 16,556,194
----------- -----------
TOTAL INVESTMENTS ....................................... 45,716,472 46,085,433
Cash and cash equivalents ................................ 1,966,236 2,855,781
Assumed reinsurance premiums receivable .................. 1,030,423 1,145,874
Reinsurance balances recoverable ......................... 674,223 674,223
Fund deposit with a reinsurer ............................ 108,000 108,000
Accrued investment income ................................ 413,625 448,786
Deferred policy acquisition costs ........................ 926,735 891,311
Federal income taxes receivable .......................... 0 504,658
Prepaid expenses and other assets ........................ 158,047 130,427
----------- -----------
TOTAL ASSETS ............................................ $50,993,761 $52,844,493
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Unpaid losses and loss adjustment expenses ............... $30,551,561 $29,242,625
Unearned premiums ........................................ 3,251,701 3,127,409
Reinsurance balances payable ............................. 174,833 174,833
Accrued expenses and other liabilities ................... 585,584 572,407
----------- -----------
TOTAL LIABILITIES ....................................... 34,563,679 33,117,274
----------- -----------
STOCKHOLDERS' EQUITY
Common shares, $1 par value, 500,000 shares authorized,
2002 and 2001: 331,751 issued and outstanding .......... 331,751 331,751
Additional paid-in capital ............................... 6,801,870 6,801,870
Retained earnings ........................................ 9,855,434 9,747,981
Accumulated other comprehensive income ................... 321,363 3,582,854
Treasury Stock (23,961 and 20,388 shares) at cost (880,336) (737,237)
----------- -----------
TOTAL STOCKHOLDERS' EQUITY .............................. 16,430,082 19,727,219
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY .............. $50,993,761 $52,844,493
=========== ===========
See the accompanying notes to the condensed consolidated financial statements.
2
AMERINST INSURANCE GROUP, LTD.
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS, COMPREHENSIVE INCOME
AND RETAINED EARNINGS
(Unaudited)
Nine Months Nine Months Three Months Three Months
Ended Ended Ended Ended
Sept. 30, 2002 Sept. 30, 2001 Sept. 30, 2002 Sept. 30, 2001
-------------- -------------- -------------- --------------
Revenue
Premiums earned ................................... $ 4,680,080 $ 4,756,478 $ 1,382,612 $ 1,600,860
Net investment income ............................. 1,533,858 1,702,203 599,778 485,599
Net realized capital gain (loss) .................. 752,808 367,480 (129,060) 118,211
----------- ----------- ----------- -----------
Total Revenue .................................. 6,966,746 6,826,161 1,853,330 2,204,670
Losses And Expenses
Losses and loss adjustment expenses ............... 4,212,236 4,667,550 1,244,351 1,518,407
Policy acquisition costs .......................... 1,381,868 1,402,714 413,268 473,937
Operating and management expenses ................. 661,300 630,394 213,583 114,567
----------- ----------- ----------- -----------
Total Losses And Expenses ...................... 6,255,404 6,700,658 1,871,202 2,106,911
----------- ----------- ----------- -----------
Net Income (Loss) .................................. $ 711,342 $ 125,503 $ (17,872) $ 97,759
Other Comprehensive Income (Loss)
Net unrealized holding gain (loss)
arising during the period ...................... (2,508,683) 444,935 (1,962,376) (1,126,298)
Reclassification adjustment for gains
included in net income ......................... (752,808) (367,480) 129,060 (118,211)
----------- ----------- ----------- -----------
Other Comprehensive Income(Loss) .................. (3,261,491) 77,455 (1,833,316) (1,008,087)
----------- ----------- ----------- -----------
Comprehensive Income (Loss) ........................ $(2,550,149) $ 202,958 $(1,851,188) $ (910,328)
=========== =========== =========== ===========
Retained Earnings, Beginning Of Period ............. $ 9,747,981 $ 9,818,445 $10,073,486 $ 9,432,012
Net income (loss) .................................. 711,342 125,503 (17,872) 97,759
Dividends paid ..................................... (603,889) (619,051) (200,180) (204,874)
----------- ----------- ----------- -----------
Retained Earnings, End Of Period ................... $ 9,855,434 $ 9,324,897 $ 9,855,434 $ 9,324,897
=========== =========== =========== ===========
Per share amounts
Net income(loss) ................................ $ 2.30 $ 0.39 $ (0.06) $ 0.31
=========== =========== =========== ===========
Dividends paid .................................. $ 1.95 $ 1.95 $ 0.65 $ 0.65
=========== =========== =========== ===========
Weighted average number of shares
outstanding for the entire period ............... 309,577 317,993 308,735 315,105
=========== =========== =========== ===========
See the accompanying notes to the condensed consolidated financial statements.
3
AMERINST INSURANCE GROUP, LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Nine Months
Ended Ended
Sept. 30, Sept. 30,
2002 2001
----------- -----------
OPERATING ACTIVITIES
Net Cash Provided by Operating Activities ........................... $ 1,850,482 $ (367,559)
----------- -----------
INVESTING ACTIVITIES
Purchases of investments ........................................... (25,529,267) (11,602,618)
Proceeds from sales and maturities of investments .................. 23,536,228 11,867,264
----------- -----------
Net Cash Provided by (Used in)
Investing Activities .............................................. (1,993,039) 264,646
----------- -----------
FINANCING ACTIVITIES
Purchase treasury stock ............................................ (143,099) (78,896)
Dividends paid ..................................................... (603,889) (619,051)
----------- -----------
Net Cash Used in Financing Activities ............................... (746,988) (697,947)
----------- -----------
DECREASE IN CASH .................................................... $ (889,545) $ (800,860)
=========== ===========
See the accompanying notes to the condensed consolidated financial statements.
4
AMERINST INSURANCE GROUP, LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
September 30, 2002
Basis of Presentation
The condensed consolidated financial statements included herein have been
prepared by AmerInst Insurance Group, Ltd. (AIG) without audit, pursuant to the
rules and regulations of the Securities and Exchange Commission and reflect all
adjustments consisting of normal recurring accruals, which are, in the opinion
of management, necessary for a fair presentation of the results of operations
for the periods shown. These statements are condensed and do not incorporate all
the information required under generally accepted accounting principles to be
included in a full set of financial statements. It is suggested that these
condensed statements be read in conjunction with the consolidated financial
statements at and for the year ended December 31, 2001 and notes thereto,
included in the Registrant's annual report as of that date.
Part I, Item 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
OPERATIONS
Three months ended September 30, 2002 compared to three months ended September
30, 2001:
A net loss of $(17,872) was recorded for the third quarter of 2002 in comparison
to a net income of $97,759 for the same period of 2001. The decline in the
results is due to decrease in the net realized capital gain (loss) for the
period in comparison to the same period in 2001. Earned premiums for the third
quarter of 2002 amounted to $1,382,612 as compared to $1,600,860 for the third
quarter of 2001, a decrease of $218,248 or 13.6%. Premiums written for the three
months ended September 30, 2002 were $1,922,290, as compared to $1,769,244 for
the third quarter of 2001, an increase of $153,046 or 8.7%.
The loss ratio for the third quarter of 2002 was 90.0% for the current treaty,
as compared to 94.8% for the same period of 2001. The loss ratio of 90.0%
represents management's current estimated effective loss rate selected in
consultation with the Company's independent consulting actuary to apply to
current premiums assumed and earned. The Company's overall loss ratio for the
year ended December 31, 2001 was 94.7%.
5
AMERINST INSURANCE GROUP, LTD.
OPERATIONS--(Continued)
Policy acquisition costs of $413,268 were expensed in the third quarter of 2002
as compared to $473,937 for the same period of 2001, a decrease of $60,669 or
12.8%. Such costs as a percentage of premiums earned are 29.9% and 29.6% for the
quarters ended September 30, 2002 and 2001, respectively. Policy acquisition
costs result from ceding commissions paid to ceding companies determined
contractually pursuant to reinsurance agreements and federal excise taxes paid
on premiums written to ceding companies.
These fluctuations in premiums, losses and expenses combined to result in a net
underwriting loss of $(488,590) for the third quarter of 2002 as compared to
$(506,051) for the same period of 2001, an improvement of $17,461 or 3.5%. The
improvement is due to a decrease in the recorded losses.
Investment yield for the third quarter of 2002 was 1.2%, consisting of interest
and dividend income, and represents a decrease from the 4.1% return earned in
the third quarter of 2001. Sales of securities during the third quarter of 2002
resulted in realized capital losses of $129,060, as compared to gains of
$118,211 in the third quarter of 2001. Losses recorded in the third quarter of
2002 primarily related to sales of equities. Proceeds from these sales were
subsequently reinvested in other equity securities.
Nine months ended September 30, 2002 compared to nine months ended September 30,
2001:
Net income of $711,342 was recorded for the nine months ended September 30, 2002
in comparison to a net income of $125,503 for the nine months ended September
30, 2001. The improved results are due to a decrease of incurred losses.
Sales of securities during the nine months ended September 30, 2002 resulted in
realized capital gains of $752,808 as compared to $367,480 in the same period of
2001. Gains recorded in 2002 primarily related to sales of equities, which were
reinvested in other equity securities. Net investment income through September
30, 2002 was $1,533,858 compared to $1,702,203 for the same period of 2001.
Investment yield for the nine months period was approximately 4.27% as compared
to 4.8% for the first nine months of 2001.
Earned premiums for the first nine months of 2002 amounted to $4,680,080 as
compared to $4,756,478 for 2001. The change of $76,398 represents a 1.6%
decrease. The decrease in earned premiums is attributable to the timing of
policies written under the current treaty compared to the same period in 2001.
Premiums written in the nine months ended September 30, 2002 were $4,804,372 as
compared to $4,711,792 for the same period in 2001. The increase of $92,580 is
due to the continued growth of the AICPA Professional Liability Insurance Plan
("AICPA Plan"), an increase in the number of insureds under the AICPA Plan, and
certain rate increases associated with a "step plan" that was initiated during
1995. Under the step plan, insureds are offered discounted premium rates for
favorable loss experience. However, as these insureds experience losses their
premiums are "stepped up" accordingly. Because of the use of claims-made
policies, as the number of years of coverage provided increases, CNA's (and
AIG's) exposure increases. This additional exposure results in an increase in
premiums charged.
The loss ratio through the first nine months of 2002 was 90.0% as compared to
98.1% for the same period of 2001. The loss ratio of 90.0% represents
management's current estimated effective loss ratio selected in consultation
with the Company's independent consulting actuary.
6
AMERINST INSURANCE GROUP, LTD.
OPERATIONS--(Continued)
Losses recorded through September 30, 2002 do not reflect any development of
prior year reserves. The Company's actuary provides a range for loss reserves at
December 31 each year. At December 31, 2001 the Company's management determined
that the reserve should be $29,242,625. This amount is within, and at the upper
end of the range provided by the actuary. Due to the inherent uncertainty in
reserving for accountants' professional liability claims management believes
this is an appropriate reserving policy. It should be noted that any reserve
amount selected in the range has a direct effect on the net income of any given
year, as well as shareholders' equity and the book value per share of the
Company. Management will review the actuary's report at December 31, 2002 and
select a reserve amount based on the recommendations of the actuary and the
maturity of the related loss reserves.
Policy acquisition costs of $1,381,868 were expensed in the first nine months of
2002 as compared to $1,402,714 for the same period of 2001, a decrease of 1.5%.
Such costs as a percentage of premiums earned are 29.5% and 29.5% for the
nine-month periods ended September 30, 2002 and 2001, respectively. Policy
acquisition costs result from ceding commissions paid to ceding companies which
are determined contractually pursuant to reinsurance agreements and federal
excise taxes paid on premiums written to ceding companies. These fluctuations
combined to result in a net underwriting loss of $(1,575,324) for the nine month
period as compared to $(1,944,180) for the same period in 2001, an improvement
of $368,856 or 19.0%. The more favorable underwriting results in 2002 are due to
the loss ratio of 90.0% in 2002, compared to 98.1% in 2001.
FINANCIAL CONDITION AND LIQUIDITY
As of September 30, 2002, total invested assets amounted to $47,682,708, a
decrease of $1,258,506 or 2.6% from $48,941,214 at December 31, 2001. Cash and
cash equivalents balances decreased from $2,855,781 at December 31, 2001 to
$1,966,236 at September 30, 2002, a decrease of $889,545, or 31.1%. The amount
of cash and cash equivalents varies depending on the maturities of fixed term
investments and on the level of funds invested in money market mutual funds. The
ratio of cash and invested assets to total liabilities at September 30, 2002 was
1.38:1, compared to a ratio of 1.41:1 at September 30, 2001.
Assumed reinsurance premiums receivable represents current assumed premiums
receivable less commissions payable to the fronting carriers. This balance was
$1,145,874 at December 31, 2001 and $1,030,423 at September 30, 2002. This
balance fluctuates due to the timing of renewal premiums written. Reinsurance
balances payable represents AIG's estimate of the premiums due to the Company's
reinsurer under the retrocession agreements described above, and amounts
currently due for losses and loss adjustment expenses payable. At December 31,
2001 and at September 30, 2002 the balance was $174,833.
7
AMERINST INSURANCE GROUP, LTD.
QUANTITATIVE AND QUALITATAIVE DISCLOSURES ABOUT MARKET RISK
INFLATION
The Company does not believe its operations have been materially affected by
inflation. The potential adverse impacts of inflation include: (a) a decline in
the market value of the Company's fixed maturity investment portfolio; (b) an
increase in the ultimate cost of settling claims which remain unresolved for a
significant period of time; and (c) an increase in the Company's operating
expenses. However, the Company generally holds its fixed maturity investments to
maturity and currently believes that the yield is adequate to compensate the
Company for the risk of inflation. In addition, any increase from inflation in
the ultimate cost of settling unpaid claims will be offset by investment income
earned during the period that the claim is outstanding. Finally, the increase in
operating expenses resulting from inflation should generally be matched by
similar inflationary increases in the premium rates.
Market Sensitive Instruments
Market risk generally represents the risk of loss that may result from potential
change in the value of a financial instrument due to a variety of market
conditions. The Company's exposure to market risk is generally limited to
potential losses arising from changes in the level of interest rates on market
values of fixed term holdings and changes in the market values of equity
securities. The Company does not hold or issue derivative financial instruments
for either trading or hedging purposes.
a) Interest Rate Risk.
Interest rate risk results from the Company's holdings in
interest-rate-sensitive instruments. The Company is exposed to potential
losses arising from changes in the level of interest rates on fixed rate
instruments held. The Company is also exposed to credit spread risk resulting
from possible changes in the issuer's credit rating. To manage its exposure to
interest rate risk the Company attempts to select investments with
characteristics that match the characteristics of the related insurance
liabilities. Additionally, the Company generally only invests in higher-grade
interest bearing instruments.
b) Foreign Exchange Risk.
The Company only invests in U.S. dollar denominated financial instruments
and does not believe it has any exposure to foreign exchange risk.
c) Equity Price Risk
Equity price risk arises from fluctuations in the value of securities held.
The Company invests in equity securities in order to diversify its investment
portfolio, which Management believes will assist the Company to achieve its goal
of long-term growth of capital and surplus. Management has adopted investment
guidelines that set out rate of return and asset allocation targets, as well as
degree of risk and equity investment restrictions to minimize exposure to
material risk from changes in equity prices.
The tables below provide information about the Company's available for sale
investments that are sensitive to change in interest rates at September 30, 2002
and December 31, 2001 respectively. We believe that a 100 basis point interest
rate change would not have a material affect on the Company's financial
position.
Market Value Market Value
09/30/2002 12/31/2001
------------ ------------
Fixed Income Portfolio
- ----------------------
Due in 1 year or less $ 1,000,000 $ 2,034,652
Due after 1 year through 5 years 5,005,402 3,724,912
Due after 5 years through 10 years 2,871,121 4,435,397
Due after ten years 1,282,050 1,419,268
----------- -----------
Sub-total $10,158,573 $11,614,229
Mortgage backed securities and
Obligations of U.S. government
Corporations and agencies $22,403,423 $17,915,010
----------- -----------
Total Fixed-Income $32,561,996 $29,529,239
=========== ===========
Total Equities $13,154,476 $16,556,194
=========== ===========
8
AMERINST INSURANCE GROUP, LTD.
FINANCIAL CONDITION AND LIQUIDITY
On June 1, 2000, the Board of Directors of AmerInst Investment Company, Ltd
("Investco"), which holds almost all of the Company's investment portfolio,
authorized to spend up to $1 million to purchase outstanding Common Shares of
the Company. On September 8, 2000, the Bermuda Monetary Authority authorized the
purchase of up to 15,000 Common Shares pursuant to the June 1 Board
authorization. Such purchases are effected through privately negotiated
transactions and are in addition to Investco's practice of redeeming the shares
of individuals who have died or retired from the practice of public accounting.
Subsequently, on July 19, 2002, the Bermuda Monetary Authority authorized
blanket permission for Investco to purchase Common Shares from individuals who
have died or retired from the practice of public account and on a negotiated
case-by-case basis without limit. To date, Investco has purchased 13,281 Common
Shares for a purchase price of $411,353. In addition, to date Investco has
purchases 10,759 Common Shares from individuals who have died or retired for a
purchase price of $471,625. The Company paid its twenty-ninth consecutive
quarterly dividend of $0.65 per share during the third quarter of 2002.
CONTROLS AND PROCEDURES
Within the 90 days prior to the date of this report, the Company carried out an
evaluation, under the supervison and with the participation of the Company's
management, including the Company's President and Chief Financial Officer, of
the effectiveness of the design and operation of the Company's disclosure
controls and procedures pursuant to Exchange Act Rule 13a - 14. Based upon that
evaluation, the President and Chief Financial Officer concluded that the
Company's disclosure controls and procedures are effective in timely alerting
them to material information relating to the Company (including it's
consolidated subsidiaries) as required to be included in the Company's periodic
SEC filings. There have been no significant changes in the Company's internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of their evaluation.
Part II, Item 6.
EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
See Index to Exhibits immediately following the signature page.
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the quarter ended June 30, 2001.
9
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMERINST INSURANCE GROUP, LTD.
-------------------------------------
(Registrant)
November 14, 2002 /s/ Murray Nicol
---------------------------------
Murray Nicol
(Vice President and Chief Financial Officer,
duly authorized to sign this Report in such
capacity and on behalf of the Registrant.)
10
I Stuart Grayston, President of the AmerInst Insurance Group, Ltd. certify that:
1. I have reviewed this quarterly report on Form 10-Q of AmerInst
Insurance Group, Ltd;
2. based on my knowledge, the report does not contain any untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements made, in light of the
circumstances under which such statements were made, not misleading
with respect to the period covered by the report;
3. based on my knowledge, the financial statements, and other financial
information included in the report, fairly present in all material
respects the financial condition, results of operations and cash flows
of the issuer as of, and for, the periods presented in the report;
4. The other certifying officer and I are responsible for establishing
and maintaining "disclosure controls and procedures" (as defined in
Section 302(a)(4) of the Act) for the issuer;
a. have designed such disclosure controls and procedures to ensure
that material information is made known to them, particularly
during the period in which the periodic report is being prepared;
b. have evaluated the effectiveness of the issuer's disclosure
controls and procedures as of a date within 90 days prior to the
filing date of the report; and
c. have presented in the report their conclusions about the
effectiveness of the disclosure controls and procedures based on
the required evaluation as of that date;
5. The other certifying officer and I have disclosed to the issuer's
auditors and to the audit committee of the board of directors:
a. all significant deficiencies in the design or operation of
internal control which could adversely affect the issuer's
ability to record, process, summarize and report financial data
and have identified for the issuer's auditors any material
weaknesses in internal controls; and
b. any fraud, whether or not material, that involves management or
other employees who have a significant role in the issuer's
internal controls; and
6. The other certifying officer and I have indicated in the report
whether or not there were significant changes in internal controls or
in other factors that could significantly affect internal controls
subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material
weaknesses.
Date: November 14, 2002 By: /s/ Stuart Grayston
----------------- -------------------
Stuart Grayston
President
I Murray Nicol, Vice President and CFO of the AmerInst Insurance Group, Ltd.
certify that:
1. I have reviewed this quarterly report on Form 10-Q of AmerInst
Insurance Group, Ltd;
2. based on my knowledge, the report does not contain any untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements made, in light of the
circumstances under which such statements were made, not misleading
with respect to the period covered by the report;
3. based on my knowledge, the financial statements, and other financial
information included in the report, fairly present in all material
respects the financial condition, results of operations and cash flows
of the issuer as of, and for, the periods presented in the report;
4. The other certifying officer and I are responsible for establishing
and maintaining "disclosure controls and procedures" (as defined in
Section 302(a)(4) of the Act) for the issuer;
a. have designed such disclosure controls and procedures to ensure
that material information is made known to them, particularly
during the period in which the periodic report is being prepared;
b. have evaluated the effectiveness of the issuer's disclosure
controls and procedures as of a date within 90 days prior to the
filing date of the report; and
c. have presented in the report their conclusions about the
effectiveness of the disclosure controls and procedures based on
the required evaluation as of that date;
5. The other certifying officer and I have disclosed to the issuer's
auditors and to the audit committee of the board of directors:
a. all significant deficiencies in the design or operation of
internal control which could adversely affect the issuer's
ability to record, process, summarize and report financial data
and have identified for the issuer's auditors any material
weaknesses in internal controls; and
b. any fraud, whether or not material, that involves management or
other employees who have a significant role in the issuer's
internal controls; and
6. The other certifying officer and I have indicated in the report
whether or not there were significant changes in internal controls or
in other factors that could significantly affect internal controls
subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material
weaknesses.
Date: November 14, 2002 By: /s/ Murray Nicol
----------------- --------------------
Murray Nicol
Vice President & CFO
AMERINST INSURANCE GROUP, LTD.
INDEX TO EXHIBITS
Quarterly Period Ended September 30, 2002
Exhibit
Number Description
- ------- -----------
3(i) Memorandum of Association of the Company (1)
3(ii) Bye-laws of the Company (1)
4.1 Section 47 of the Company's Bye-laws -- included in Exhibit 3(ii)
above
4.2 Statement of Share Ownership Policy, as Amended (9)
10.1 Reinsurance Treaty between AIIC and Virginia Surety Company, Inc. (2)
10.2 Agreement between Country Club Bank and AIIC (2)
10.3 Agreement between Country Club Bank and AIIG (2)
10.4 Reinsurance Treaty between AIIC and CNA Insurance Companies (3), 1994
placement slip (4), 1995 placement slip (5), 1996 placement slip (6),
1997 placement slip (9), and 1998 placement slip (10) and Endorsement
No. 1 to the Treaty effective July 1, 1999 (11)
10.5 Revised Management Agreement between Vermont Insurance Management,
Inc. and AIIC dated May 1, 1997 (7), Addenda to Management Agreement
dated July 1, 1997 (8), Addenda to Management Agreement dated July 1,
1998 (10), Management Agreement between USA Offshore Management, Ltd.
and AmerInst Insurance Company Ltd. dated as of December 2, 1999 (12)
and Addenda to Agreement between AmerInst Insurance Company Ltd. and
USA Offshore Management, Ltd. dated June 2, 2000 (12).
10.6 Escrow Agreement among AIIC, United States Fire Insurance Company and
Harris Trust and Savings Bank dated March 7, 1995 (5)
10.7 Security Trust Agreement among AIIC, Harris Trust and Savings Bank and
Virginia Surety Company, Inc. dated March 9, 1995 (5)
10.8 Investment Advisory Agreement For Discretionary Accounts between
Amerinst Insurance Company and Harris Associates L.P. dated as of
January 22, 1996, as amended by the Amendment to Investment Advisory
Agreement for Discretionary Accounts dated as of April 2, 1996 (10)
10.9 Exchange Agreement between the Company the AIG Ltd., dated as of
January 20, 1999 (1)
10.10 Reinsurance Treaty between AIC Ltd. and CNA Insurance Companies,
effective December 1, 1999 (11)
10.11 Value Plan Reinsurance Treaty between AIC Ltd. and CNA Insurance
Companies, effective December 1, 1999 (11)
10.12 Trust Agreement among AIC Ltd., Continental Casualty Company and Chase
Manhattan Bank dated as of December 21, 2000 (13)
10.13 Investment Counsel Agreement between AIC Ltd. and Northwest Investment
Management, Inc. dated August 1, 2000 (13)
10.14 Registrar and Transfer Agent Agreement between AIC Ltd. and
Butterfield Corporate Services Limited dated as of January 1, 2001
(14)
10.15 Reinsurance Treaty between AIC Ltd. and CNA Insurance Companies,
effective January 1, 2002 (15)
10.16 Value Plan Reinsurance Treaty between AIC Ltd. and CNA Insurance
Companies, effective January 1, 2002 (15)
21 Subsidiaries of the Registrant (1)
99.1 President Certification pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
99.2 Vice President Certification pursuant of Section 906 of the
Sarbanes-Oxley Act of 2002
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(1) Filed with the Company's Registration Statement on Form S-4, Registration
No. 333-64929 and incorporated herein by reference.
(2) Filed with the AIIG's Annual Report on Form 10-K for the year ended
December 31, 1992 and incorporated herein by reference.
(3) Filed with the AIIG's Annual Report on Form 10-K for the year ended
December 31, 1993 and incorporated herein by reference.
(4) Filed with the AIIG's Annual Report on Form 10-K for the year ended
December 31, 1994 and incorporated herein by reference.
(5) Filed with the AIIG's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1995 and incorporated herein by reference.
(6) Filed with the AIIG's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1996 and incorporated herein by reference.
(7) Filed with the AIIG's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1997 and incorporated herein by reference.
(8) Filed with the AIIG's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1997 and incorporated herein by reference.
(9) Filed with AIIG's Annual Report on Form 10-K for the year ended December
31, 1996 and incorporated herein by reference.
(10) Filed with AIIG's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998 and incorporated herein by reference.
(11) Filed with the Company's Annual Report on Form 10-K for the year ended
December 31, 1999.
(12) Filed with AIIG's Quarterly Report on Form 10-Q for the quarter ended
June 30, 2000 and incorporated herein by reference.
(13) Filed with the Company's Annual Report on Form 10-K for the year ended
December 31, 2000 and incorporated herein by reference.
(14) Filed with the Company's Annual Report on Form 10-K for the year ended
December 31, 2001.
(15) Filed with the Company's Quarterly Report on Form 10-Q for the quarter
ended March 31, 2002 and incorporated herein by reference.