State Auto buys $40mn adverse development cover from Munich Re

State Auto has bought a $40mn adverse development cover from Munich
Re as it looks to manage further deterioration in its loss-struck
programme business.
The US insurer alerted investors today (20 January) to a reserve
charge of $72mn before tax it will reflect in its fourth quarter
2014 financials when they are released next month.
The adverse development relates to programme business written
through its Risk Evaluation & Design (RED) subsidiary.
State Auto said most of the charges account