The Sinking Ship is all but Sunk

February 11, 2009 at 4:17 pm Leave a comment

It feels like Dejavu all over again! Except this time instead of the company being sold the company ran out of money. I previously posted here about my fears that my company was going under.

Well it pretty much is. On Monday the company announced a profit warning ($340 million loss for the 4th Qtr.), intent to sell off non core lines and a corporate restructuring plan.

So to break it down here is what happened. The company grew uncontrollably for several years. Much of the premium that they took in was from bad risks. So we were paying out more in claims than we took in in premium. This caused us to have to keep going back to our parent company for cash to keep us going. Over the last 2 years our parent company has had to give us $443 Million.

Combine that with the unfavorable conditions in the market that casued our company investments to go down and basically our parent company can no longer give us money to continue to operate. So we are not selling any new policies, only renewing policies we have to due to regulatory concerns. Basically shutting the doors. We have to submit a plan to the PA Department of Insurance within the next 30 days that outlines how we are going to run-off our business.

So sometime between the next 30 and 90 days we will all know who has a job and who does not. Overall the company is cutting 750 people form a staff of about 3000 or about 25% so that means about 100 people from my company.

So if anyone is looking for a well educated, smart, IT Manager let me know.

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Entry filed under: Uncategorized.

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