Question-and-Answer Session
Operator
(Operator Instructions) One moment please for our first question. Stuart Johnson from Philo Smith, your line is open.
Stuart Johnson – Philo Smith
I have a question for Bob Whitlock on the commercial lines. You mentioned that the commercial auto competition was up there, I was just wondering about the other three commercial lines you have especially the multi parallel, what did pricing look like here?
Robert G. Whitlock, Jr.
Pricing overall as pointed out was about 3.5% down and a very similar number for commercial multi parallel.
Stuart Johnson – Philo Smith
It seemed given the pressure and pricing your commercial top line was fairly strong. Can you comment on how you did that? Keeping the top line fairly consistent given the pricing pressures?
Michael L. Browne
Well, you know part of it is staying close to our agents. Quite frankly, our mid market business was flat, most of the increase in our business came from writing more small commercial lines and one of the things that we’re seeing and we’re very pleased about is you’ve heard us talk about the roll out of our new system for both commercial lines and personal lines and that mainly is on the commercial lines side directed to writing for small business. Then, where we have had the new system roll out long enough to see an impact we’re really seeing an impact in terms of writing more small commercial business. One of the really attractive things about that is that small business is much less price sensitive than mid market business and so we really think that’s going to help us in this soft market.
Stuart Johnson – Philo Smith
Then a question on your reinsurance, you used excess of loss, were there any changes in the terms in terms of the retention levels and so forth?
Michael L. Browne
No, there were not.
Stuart Johnson – Philo Smith
And what about pricing? Did you see any benefit this year versus last?
Michael L. Browne
We have seen some benefit in pricing and pricing has been coming down for us.
Stuart Johnson – Philo Smith
Has that affected your use of reinsurance at all?
Michael L. Browne
No, it hasn’t.
Stuart Johnson – Philo Smith
Then my last question just has to do with the changes in the intercompany pooling agreement. Generally, these are used to produce a more uniform or stable underwriting results, what was the thought internally in terms of making the change that you did?
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