SCOPE OF THE EXAMINATION
This examination of Mapfre Insurance Company “MIC” covers the period from January 1, 2006 to December 31, 2008. The examination was conducted under Section 17:23-22 of the New Jersey Statutes Annotated (N.J.S.A.) Revised Statutes. During this period under examination, the Company's assets decreased from $247,160,213 to $38,358,410. Liabilities decreased from $99,901,094 to $8,617,031 and surplus as regards to policyholders decreased from $147,259,119 to $29,741,379.
In determining the emphasis placed on each item reported herein, consideration was given to the Company’s accounting methods and internal controls, information systems controls, audits performed by certified public accountants for the period under review, financial analysis performed by the Financial Analysis Unit of the New Jersey Department of Banking and Insurance (“NJDOBI”), and procedures specified by the National Association of Insurance Commissioners.
No accounts were determined to require special emphasis. Standard emphasis, as defined in the New Jersey Financial Condition Examiners Handbook, was used in several instances. Accounts requiring standard emphasis were:
Losses Reinsurance and the related accounts Premium in course of collection Unearned premiums Bonds Cash
All other accounts were determined to require reduced emphasis. Additional areas reviewed during this examination were as follows:
History and Kind of Business Management and Control Territory and Plan of Operation Policy on Conflict of Interest Intercompany Agreements Accounts and Records Fidelity Bond and Other Insurance Coverage
The examination report, contained herein, will address significant balance sheet accounts and, if necessary, comments on those accounts which involve departures from laws, regulations or rules, or which are deemed to require special explanation or description.
Work papers prepared by the Company’s external accounting firm, Ernst & Young LLP (“E&Y”), New York, New York, in connection with the annual audit, were reviewed and relied upon to the extent possible.
COMPLIANCE WITH PRIOR REPORT ON EXAMINATION RECOMMENDATIONS
There were no recommendations in the prior examination report.