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To
the Board of Directors and Policyholders We have audited the accompanying statutory statements of admitted assets, liabilities and surplus of Princeton Insurance Company (the “Company”) as of December 31, 2001 and 2000, and the related statutory statements of operations and changes in surplus, and cash flows for the years then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As described in Note 2 to the financial statements, the Company prepared these financial statements using accounting practices prescribed or permitted by the Department of Banking and Insurance of the State of New Jersey, which practices differ from accounting principles generally accepted in the United States of America. The effects on the financial statements of the variances between the statutory basis of accounting and accounting principles generally accepted in the United States of America, although not reasonably determinable, are presumed to be material. In our opinion, because of the effects of the matter discussed in the preceding paragraph, the financial statements referred to above do not present fairly, in conformity with accounting principles generally accepted in the United States of America, the financial position of the Company as of December 31, 2001 and 2000, or the results of its operations or its cash flows for the years then ended. In our opinion, the financial statements referred to above present fairly, in all material respects, the admitted assets, liabilities and surplus of the Company as of December 31, 2001 and 2000, and the results of its operations and its cash flows for the years then ended, on the basis of accounting described in Note 2. As discussed in Note 1 to the financial statements, effective December 31, 2001, Princeton Insurance Company was merged with Healthcare Insurance Company, the Company’s former parent. The surviving insurance company is named Princeton Insurance Company. The transaction was accounted for as a statutory merger. Accordingly, the amounts reflected in the accompanying financial statements have been combined as if the entities were combined for all periods presented. As discussed in Note 2 to the financial statements, the Company adopted the accounting policies in the revised National Association of Insurance Commissioners “Accounting Practices and Procedures Manual” – Effective January 1, 2001, as required by the Department of Banking and Insurance of the State of New Jersey. The effect of adoption is recorded as an adjustment to policyholders’ surplus as of January 1, 2001.
April 12, 2002
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© 2002 Princeton Insurance, a MLMIC Group company, 746 Alexander Rd., Princeton, NJ 08540-6305 877-PI-EASY2. All rights reserved. |