Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Jeffrey Schuman – Keefe, Bruyette & Woods.
Jeffrey Schuman – Keefe, Bruyette & Woods
I had a question about specialty property, I was curious about the placement rate sequentially. Subprime placement rates continued to increase whereas prime sort of flattened out and I guess I was kind of thinking that maybe the reverse would be more likely. Do you think prime placement has flattened out here or was that kind of a one quarter flattening out do you think?
Robert B. Pollack
I believe in any particular quarter Jeff things like that can happen. We brought, as Mike mentioned, some new loans in to the portfolio. I wouldn’t read anything in to the one quarter number.
Jeffrey Schuman – Keefe, Bruyette & Woods
Obviously it’s extremely difficult to kind of think about scenarios for the health business but it’s also difficult to ignore the situation as well. Certainly, one of the concepts kicking out there would sort of move you off of a sort of underwritten model. If you can’t really underwrite for pre-existing conditions, potentially how dramatic is that scenario, does that mean the existing book of business would go away and you would kind of half to start over with a new product and new underwriting model or could it potentially be less dramatic than that?
Robert B. Pollack
Well, a couple of different things I’ll comment on. First, Don Hammond and the team at Assurant Health have put together a variety of different scenarios including the one you talked about Jeff and said, ?In that environment how would we play and win?? We believe we have strategies that could operate there. Remember that the reform that is talked about takes place and is effective 2013 so we’re looking several years out in the future before that comes in to effect.
I think another important point to consider in all that is existing people will be allowed to maintain or in much of legislation keep the plans that they have meaning you’re going to kind of have a different set of risks after the 2013 compared to ones that are underwritten prior to. So, maintaining that block of business of what you have on the books prior to reform will be a consideration as well. But again, until things are finalized we’re guessing and our goal is to make sure we understand how we can effectively plan in the new environment.
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