Faq (cont.)

A. Yes, Demotech, Inc. specializes in providing a broad set of management consultng services related to financial stability analysis. These specialty ratings are accepted by the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac). PEP consistently receives the highest ratings in all four areas of performance:
Financial Stability - AAA
Loss Reserve Opinion - AAA
Administration - AAA
Overall Performance - AAA

Q. What is reinsurance?

A. Reinsurance is a method by which PEP protects itself from unexpected losses. The reinsurance utilized by PEP is unique in that it protects PEP not only from a single catastrophic loss but also from a series of losses that might exhaust its financial resources.

Q. Is PEP an assessable pool?

A. No. PEP does not require its Membership to be jointly responsible for the liabilities of other Members.

Q. How does joining the PEP Pool save money?

A.

•PEP does not operate under a "for profit" motive and is tax-exempt.
•PEP has much lower overhead.
•The PEP Membership retains the investment income.
•Improved loss control which translates into reduced claims.