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Terra Achieves 64th Consecutive Quarterly Record
Corte Madera, CA - For the 64th consecutive quarter, Terra Insurance Company has achieved a new, record-high book value per share: $181.86, up almost 2% over year-end 2003's $178.53/share, and up 14% over first-quarter 2003's $159.40/share. Terra shareholders' equity also set a new record: $20.6 million, which is 10.4% ahead of the then-record $18.7 million posted at March 31, 2003.
"This is an amazing achievement considering the current state of the insurance industry," said Terra's long-time CEO, David L. J. Coduto. "A number of our competitors no longer exist, and a number of markets no longer write professional liability insurance for design professionals, particularly the geotechnical and environmental engineering firms that comprise the majority of Terra's insureds."
Mr. Coduto reported that Terra has been "inundated with requests for insurance. Most prospects have no insurance, because they have been cancelled, or they've received nonrenewal notices because of their insurers' financial problems, or they've seen the cost of coverage absolutely skyrocket."
Terra is organized as a risk retention group and, therefore, all Terra insureds must own company stock. Mr. Coduto commented that "our book of business is strong and our policyholders are happy." He pointed out that, even without considering the impact of Terra's stock value appreciation, Terra is competitively priced, and added that, in sharp contrast to others' rates, "the gross cost of Terra coverage has remained stable or actually decreased somewhat due to various premium rebates and credits. Of course, the net cost of coverage after capital appreciation continues to decline in a fairly significant manner." In fact, the value of Terra stock has increased by more than 1700% since the company became a risk retention group in 1988. As a consequence, Mr. Coduto said, "The net cost of Terra's insurance products is probably the very lowest in the industry. In fact, for the last 15 years, some of our insureds have paid a net premium of nothing at all."
Terra's accomplishments are recognized by A. M. Best Company, the international insurance company evaluation organization, which rates Terra A ("Excellent"). Terra comprises 90 owner/insureds whose total gross fees approach $1 billion annually.
More information about Terra and the products it offers, as well as free risk management materials and a copy of the Terra "QuickApp,"can be found at www.terrarrg.com, or by contacting Terra Insurance Company, 2 Fifer Avenue/Suite 100, Corte Madera, CA 94925; tel.1/800-872-0077 (in CA, 415/927-2901); e-mail terra@terrarrg.com
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