FREE 2008
Annual Report

A Letter From Our Chairperson

We are pleased to report that National Fire and Indemnity Exchange generated a $983,662 profit in 2006. We are returning 50 percent of that profit to our policyholders, 25 percent as dividends and the other 25 percent as credits to subscribed savings accounts. The remaining 50 percent of profit is being kept in the Exchange to further strengthen its financial condition (already "Excellent" according to A.M. Best) and facilitate a broadening of the products the Exchange offers the fabricare industry.

The Exchange's claim frequency was its lowest ever in 2006, with fewer than five claims for every $100,000 of premium. That favorable record is partly due to a quiet year for hurricanes. But it's more than that: it's also confirmation of the quality of the businesses insured by the Exchange, confirmation of the quality of underwriting performed by the Exchange, an indicator that the Exchange's business model is on the right track, and an indicator that, barring extraordinary events, the Exchange is likely to continue to perform well.

We have strengthened our preparations for the possibility of a long term increase in hurricane activity, increasing our purchase of catastrophe reinsurance coverage even further for 2007--to more than twice the limit we purchased for 2005. We hope we never use these higher limits, but we are determined to be ready when "the big one" hits.

National Fire & Indemnity Exchange exists to meet its policyholders' insurance needs as efficiently as possible. As a reciprocal exchange, it returns profits to its policyholders on a pre-tax basis. The Advisory Committee is honored to represent you as we strive to make the Exchange the best it can be. Thank you for letting us serve you.

--Jeanne Wolf, Advisory Committee Chairperson

From our scrapbook

NIE has a wonderful collection of industry ads and memorabilia throughout the years.

Please visit our scrapbook to view more glimpses of our history.