Financial Services, Insurance

12 Months Ended

Dec. 31, 2011

Financial Services, Insurance

Reinsurance [Text Block]

16.  Reinsurance

Independence American reinsures a portion of its direct business in order to limit the assumption of disproportionate risks.  Amounts not retained are ceded to other companies on an automatic basis.  Independence American is contingently liable with respect to reinsurance in the unlikely event that the assuming reinsurers are unable to meet their obligations.  The ceding of reinsurance does not discharge the primary liability of the original insurer to the insured.  At December 31, 2011, Independence American ceded to highly rated reinsurers.

The effect of reinsurance on insurance benefits and premiums earned is as follows (in thousands):

			ASSUMED		CEDED				% OF
			FROM		TO				AMOUNT
	DIRECT		OTHER		OTHER		NET		ASSUMED
	AMOUNT		COMPANIES		COMPANIES		AMOUNT		TO NET
Insurance Benefits:
Year ended December 31, 2011	$	26,770	$	27,238	$	6,240	$	47,768	57%
Year ended December 31, 2010	25,265		31,467		6,506		50,226		63%
Year ended December 31, 2009	25,272		39,516		5,131		59,657		66%
Premiums Earned:
Year ended December 31, 2011	$	39,893	$	42,088	$	9,533	$	72,448	58%
Year ended December 31, 2010	41,264		45,315		12,720		73,859		61%
Year ended December 31, 2009	37,396		56,664		8,545		85,515		66%