Article Abstract:
A number of issues drive the move toward demutualization of mutual insurance companies. However, while some are turning to demutualization to gain access to capital markets and stay competitive, others choose to retain a mutual holding company structure, taking into account a host of factors such as capital needs, corporate culture and financial position. Financial advisers caution highly capitalized mutual companies, citing disadvantages such as the difficulty of raising capital compared to their stock-owned competitors, the lack of flexibility of the mutual structure and rating agencies' negative perception of mutuals.
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Article Abstract:
Empire Blue Cross & Blue Shield has proposed to turn into a for-profit organization in order to create capital needed for new products and services. The plan would transfer assets, liabilities and businesses to for-profit subsidiaries already in existence and would meanwhile establish a nonprofit foundation for care to the poor and uninsured of New York state. The plan is subject to the approval of the the state attorney general's office and the New York State Dept of Insurance.
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Article Abstract:
Outsourcing enables outside experts to handle noncore business tasks while employees focus on their areas of expertise. Word processing, policy typing and transcription can be outsourced in the insurance industry to decrease costs, increase flexibility and increase productivity. An outsourcing firm should be evaluated for its knowledge of the insurance industry.
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