Eastern Insurance Plc · DSEBD:EASTERNINS
Eastern Insurance — Merger or Acquisition (August 2008)
18 slides from Eastern Insurance's merger presentation, Aug 7, 2008
Slide 1: Acquisition of Employers Security Holding Company and Subsidiaries
Exhibit 99.2 Eastern Insurance Holdings, Inc. Acquisition of Employers Security Holding Company and Subsidiaries Analyst and Investor Conference Call August 8, 2008
Slide 2: Agenda
Agenda Strategic Rationale Review of Employers Security Insurance Company Review of Proposed Transaction Structure Transaction Benefits 1 Eastern Insurance Holdings, Inc. August 8, 2008
Slide 3: Forward-Looking Statements
Forward-Looking Statements This presentation may include forward-looking statements. These forward-looking statements include comments with respect to our objectives and strategies, and the results of our operations and business. By their nature, however, these forward-looking statements involve num
Slide 4: Strategic Rationale
Strategic Rationale 3 August 8, 2008
Slide 5: Strategic Rationale
Strategic Rationale Similar business philosophies and cultures Geographic diversification Financial benefits Revenue enhancement opportunities Use of “A-” rated paper Access to EIHI’s broad product spectrum Capital Contiguous state expansion / leverage EIHI’s state licenses Operational economies of
Slide 6: Review of Employers Security Insurance Company
Review of Employers Security Insurance Company 5 Eastern Insurance Holdings, Inc. August 8, 2008
Slide 7: Employers Security Insurance Company Overview
Employers Security Insurance Company Overview Domiciled and located in Indianapolis, Indiana Currently not rated by A.M. Best Company Employers Security Insurance Company (“ESIC”) is a mono-line provider of workers’ compensation insurance (DWP in 2007 of $10.0 million) in Indiana (99.8%) and Missour
Slide 8: Pennsylvania Workers' Compensation Market Share (Top 20)
Pennsylvania Workers’ Compensation Market Share (Top 20) (dollars in thousands) 2007 Gross Five Year Three Year Written Average Loss Average Loss Premium Ratio Ratio 1. Liberty Mutual Insurance Company $ 213,698 77.79% 80.66% 2. American International Group 207,354 76.26% 79.01% 3. Zurich Financial
Slide 9: Indiana Workers' Compensation Market Share (Top 20)
Indiana Workers’ Compensation Market Share (Top 20) (dollars in thousands) 2007 Gross Five Year Three Year Written Average Loss Average Loss Premium Ratio Ratio 1. Liberty Mutual Insurance Company $ 127,953 55.17% 49.97% 2. American International Group 74,629 64.11% 71.28% 3. Travelers Insurance Com
Slide 10: Historical GAAP Consolidated Financial Results
Employers Security Holding Company and Subsidiaries Historical GAAP Consolidated Financial Results For years ended December 31 June 30, ($ in thousands) 2004 2005 2006 2007 2008 Premiums earned $ 5,013 $ 7,156 $ 8,100 $ 9,133 $ 4,570 Total revenue 5,725 8,282 9,152 10,176 5,089 Total expenses 5,070
Slide 11: Strong, Clean, Simple Balance Sheet
Strong, Clean, Simple Balance Sheet 68% of December 31, 2007 assets are in cash and invested assets High credit quality No subprime / Alt A Excellent collection history on premiums receivable Strong reinsurer security Unpaid losses and loss adjustment expense Reserves recorded at high end of actuari
Slide 12: Review of Proposed Transaction Structure
Review of Proposed Transaction Structure 11 Eastern Insurance Holdings, Inc. August 8, 2008
Slide 13: Summary of Significant Terms
Summary of Significant Terms Post closing, Employers Security Insurance Company will be a wholly-owned subsidiary of Global Alliance Holdings, Ltd., d/b/a Eastern Alliance Insurance Group Transaction value is approximately $14.9 million Approximate $12.0 million in cash purchase price to be reconcil
Slide 14: Proposed EIHI Organizational Structure
Proposed EIHI Organizational Structure Eastern Insurance Holdings, Inc. (Registrant) Eastern Life & Health Insurance Company Eastern Holding Company Ltd. (Pennsylvania Business Corporation) (Pennsylvania Business Corporation) 100% owned 100% owned Eastern Services Corporation (Pennsylvania Business
Slide 15: Proposed Reinsurance Pooling Agreement
Proposed Reinsurance Pooling Agreement ESIC will enter into a reinsurance pooling agreement with the currently existing EAIG workers’ compensation insurance entities Obtained pooled rating from A.M. Best Company of “A-”for Eastern Alliance Insurance Group, including ESIC A.M. Best Company press rele
Slide 16: Transaction Benefits
Transaction Benefits 15 Eastern Insurance Holdings, Inc. August 8, 2008
Slide 17: Benefits of Transaction to EIHI
Benefits of Transaction to EIHI Immediately accretive to EIHI’s 2008 EPS and ROE Strong, clean, simple balance sheet “Bolt-on” transaction Proven financial and operational performance Acquisition of a leveragable workers’ compensation platform that provides geographic diversification Indiana has a f
Slide 18: Eastern Insurance Holdings
eastern Insurance Holdings fresh outlooks. better outcomes.”
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