LOS ANGELES--(BUSINESS WIRE)--The Law Offices of Frank R. Cruz announces that a class action lawsuit has been filed on behalf of persons and entities that purchased or otherwise acquired ProAssurance Corporation (“ProAssurance” or the “Company”) (NYSE: PRA) common stock between April 26, 2019 and May 7, 2020, inclusive (the “Class Period”). ProAssurance investors have until August 17, 2020 to file a lead plaintiff motion.
If you are a shareholder who suffered a loss, click here to participate.
On January 22, 2020, after the market closed, ProAssurance disclosed a $37 million charge to its loss reserves for fourth quarter 2019 due to "deteriorating loss experience, driven by a large national healthcare account."
On this news, the Company's stock price fell $4.18, or 11%, to close at $33.40 per share on January 23, 2020, thereby injuring investors.
On February 20, 2020, the Company announced its 2019 fourth quarter and full year results which revealed that the adverse development from this one large national healthcare account was actually $51.5 million, much higher than the initial estimate a month prior, of $37 million.
Then, on May 8, 2020, ProAssurance revealed that the large healthcare client would most likely not be renewing its policy and alternately exercise an option for tail coverage that would result in an additional $50 million in losses in the second quarter of 2020. This loss, when combined with the $51.5 million adverse development, meant that the Company would suffer over $100 million in losses from a single account.
On this news, the Company’s stock price fell $4.38 per share, or over 22%, to close at $15.95 per share on May 8, 2020, thereby injuring investors.
The complaint alleges that throughout the Class Period, defendants made false and/or misleading statements and/or failed to disclose: (1) that ProAssurance lacked adequate underwriting process and risk management controls necessary to set appropriate loss reserves in its Specialty P&C segment; (2) that ProAssurance failed to properly assess a large national healthcare account that experienced losses far exceeding the assumptions made when the account was underwritten; and (3) that as a result, ProAssurance was subject to a materially heightened risk of financial loss and reserve charges.
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If you purchased ProAssurance securities during the Class Period, you may move the Court no later than August 17, 2020 to ask the Court to appoint you as lead plaintiff. To be a member of the Class you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the Class. If you purchased ProAssurance securities, have information or would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Frank R. Cruz, of The Law Offices of Frank R. Cruz, 1999 Avenue of the Stars, Suite 1100, Los Angeles, California 90067 at 310-914-5007, by email to email@example.com, or visit our website at www.frankcruzlaw.com. If you inquire by email please include your mailing address, telephone number, and number of shares purchased.
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