Insurance News

Assurant CEO sees 2008 compensation rise 53 pct

Posted on: April 10, 2009

DES MOINES, Iowa (AP) — Assurant Inc. awarded President and Chief Executive Robert B. Pollock compensation valued at $5.4 million for fiscal 2008, a 53 percent increase over the previous year, according to Associated Press calculations of data filed with regulators.

In a filing with the Securities and Exchange Commission on Thursday, the New York-based insurer reported paying Pollock a base salary of $950,000, up 12 percent from the year before.

In March, the board’s compensation committee, acting on information provided by a consultant, approved the pay increase to bring the CEO’s pay in line with others in the industry.

A performance based bonus more than doubled to $1.6 million from $791,900 the year before.

Pollock, 54, also received stock and option awards valued at $2.7 million on the day the were awarded, up 55 percent from $1.7 million in 2007.

Additionally, Assurant awarded Pollock $126,072 in all other compensation, which included contributions to 401(k) plans.

Pollock’s total pay package in 2007 was valued at $3.5 million, according to a calculation by The Associated Press.

The Associated Press formula is designed to isolate the value the companys board placed on the executives total compensation package during the last fiscal year. It includes salary, bonus, performance-related bonuses, perks, above-market returns on deferred compensation and the estimated value of stock options and awards granted during the year. The calculations don’t include changes in the present value of pension benefits, and they sometimes differ from the totals companies list in the summary compensation table of proxy statements filed with the Securities and Exchange Commission, which reflect the size of the accounting charge taken for the executives compensation in the previous fiscal year.

In 2008, Assurant profit fell 31 percent to $447.8 million, or $3.77 per share, from $653.7 million, or $5.38 per share, in the previous year. The results included $278.6 million in investment losses and a tax gain of $89 million.

Net operating income was $637.4 million, or $5.36 per share.

Analysts surveyed by Thomson Reuters, who typically exclude one-time gains and losses, had expected $5.61 per share.

Assurant’s stock fell 55 percent in 2008. Shares have traded between $12.52 and $71.31 in the past 12 months. They gained 29 cents to $24.38 in Thursday morning trading.

It was a year of changes for the company which became the target of an SEC investigation.

Pollock, Adam Lamnin, the chief financial officer Assurant’s specialty property unit, and CFO P. Bruce Camacho were all placed on administrative leave after the SEC issued a “Wells Notice” in connection with the investigation into certain loss mitigation insurance products.

The notice stemmed from an industrywide investigation into a product known as finite reinsurance. Some insurers were accused of using finite reinsurance contracts to polish financial statements and provide a deceptively sunny portrayal of a company’s health.

Assurant said it believes the probe focuses on a catastrophe reinsurance contract between the company and one reinsurer that expired in 2004.

Two Assurant executives were fired. Last month Camacho resigned to pursue other opportunities, although he is serving as a consultant for 12 months.

Former CEO J. Kerry Clayton served as interim president and CEO while Pollock was on leave.

Pollock was reinstated as CEO in January 2008 and Lamnin returned to work reporting to Pollock.

Assurant noted that the SEC’s staff inquiry is continuing and the company continues to cooperate with the probe.

Copyright © 2008 The Associated Press. All rights reserved.

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