Third Quarter Ended September 30, 2015
EMC Insurance Group Inc. (NASDAQ:EMCI) today reported operating
income of $6.3 million ($0.31 per share) for the third quarter
ended September 30, 2015, compared to operating income of $2.5
million ($0.12 per share) for the third quarter of 20141. For the
nine months ended September 30, 2015, the Company reported
operating income of $32.8 million ($1.59 per share), compared to
$11.7 million ($0.58 per share) for the same period in 2014.
Net income, including realized investment gains and losses,
totaled $11.2 million ($0.54 per share) for the third quarter of
2015, compared to $2.2 million ($0.11 per share) for the third
quarter of 2014. For the nine months ended September 30, 2015, the
Company reported net income of $40.3 million ($1.96 per share),
compared to $13.8 million ($0.69 per share) for the same period in
2014.
The Company’s GAAP combined ratio was 101.8 percent in the third
quarter of 2015, compared to 107.1 percent in the third quarter of
2014. For the first nine months of 2015, the Company’s GAAP
combined ratio was 97.0 percent, compared to 105.0 percent in
2014.
“Operating results for the third quarter improved in both
segments, continuing the trend experienced in the first half of the
year,” stated President and Chief Executive Officer Bruce G.
Kelley. “Based on the good results achieved through the first nine
months of the year, we now expect to achieve 2015 operating income
near the high end of our guidance range.”
Based on results for the first nine months of 2015 and
projections for the remainder of the year, management is
reaffirming its 2015 operating income guidance in the previous
range of $1.80 to $2.00 per share. This guidance is based on a
projected GAAP combined ratio of 97.6 percent for the year and
investment income consistent with the amount reported in 2014. The
load for catastrophe and storm losses has been reduced to 8.6
points from the previous load of 9.5 points; however, the 0.9 point
decline in the loss ratio attributable to this reduction was
partially offset by an increase in other types of losses.
Kelley continued, “Catastrophe and storm losses are down for the
year compared to our long-term average, and we expect the
inter-company reinsurance programs announced earlier this week will
help reduce the volatility we have historically experienced in our
quarterly results due to catastrophe and storm losses.” These
reinsurance programs will become effective January 1, 2016, subject
to approval by regulatory authorities.
In addition, on November 4, 2015, the board of directors of the
Company declared a quarterly cash dividend of $0.19 per share of
common stock payable November 24, 2015 to stockholders of record as
of November 17, 2015. The $0.19 per share quarterly dividend
represents an 11.8 percent increase over the previous quarterly
dividend of $0.17 per share, and when combined with the dividend
increase implemented during the third quarter, represents a 14.0
percent increase over the previous split-adjusted dividend of
$0.1667 per share.
Kelley went on to say, “This double-digit percentage increase of
the dividend is a reflection of the good results achieved through
the first nine months of the year, and our expectations for the
fourth quarter. Our intent is to reward stockholders with an
attractive return on their investment--and we have. The Company has
paid a quarterly dividend since becoming publicly held in February
1982, and has never reduced its dividend. We remain confident in
the strength of our balance sheet to support future dividend
payments and continued profitable growth,” concluded Kelley.
In the third quarter, premiums earned increased 5.4 percent to
$145.8 million, from $138.3 million in 2014. In the property and
casualty insurance segment, premiums earned increased 5.4 percent,
with the majority of the increase attributable to rate level
increases on renewal business and growth in insured exposures and
an increase in retained policies in the commercial lines of
business.
In the reinsurance segment, premiums earned increased 5.5
percent, primarily due to growth in the Mutual Reinsurance Bureau
underwriting association (MRB), which reported a significant
increase in pro rata liability business. The increase in MRB
premiums was partially offset by reduced participation in the
offshore energy and liability proportional account for the 2015
contract year. It is important to note that a premium adjustment
made in 2014 is inflating the percentage increase reported for the
third quarter of 2015. This adjustment stemmed from a change in the
premium recognition period of two large facility contracts in the
pro rata property line of business that was implemented in the
third quarter of 2014. For the first nine months of 2015, premiums
earned increased 5.9 percent (6.6 percent in the property and
casualty insurance segment and 3.5 percent in the reinsurance
segment).
Catastrophe and storm losses totaled $17.8 million ($0.56 per
share after tax) in the third quarter of 2015, compared to $17.5
million ($0.56 per share after tax) in the third quarter of 2014.
Third quarter catastrophe and storm losses accounted for 12.2
percentage points of the combined ratio, which is below the
Company’s most recent 10-year average of 14.2 percentage points for
this period and consistent with the 12.6 percentage points
experienced in the third quarter of 2014. For the first nine months
of 2015, catastrophe and storm losses totaled $40.8 million ($1.29
per share after tax), compared to $52.8 million ($1.70 per share
after tax) in 2014. On a segment basis, catastrophe and storm
losses amounted to $9.9 million ($0.31 per share after tax) and
$28.7 million ($0.91 per share after tax) in the property and
casualty insurance segment, and $7.9 million ($0.25 per share after
tax) and $12.1 million ($0.38 per share after tax) in the
reinsurance segment, for the three months and nine months ended
September 30, 2015, respectively.
The Company reported $2.2 million ($0.07 per share after tax) of
favorable development on prior years’ reserves during the third
quarter of 2015, compared to $1.7 million ($0.06 per share after
tax) in the third quarter of 2014. For the first nine months of
2015, favorable development totaled $20.0 million ($0.63 per share
after tax), compared to $10.9 million ($0.35 per share after tax)
in 2014. Development amounts can vary significantly from quarter to
quarter and year to year depending on a number of factors,
including the number of claims settled and the settlement terms,
and should therefore not be considered a reliable factor in
assessing the adequacy of the Company’s carried reserves. The most
recent actuarial analysis of the Company’s carried reserves
indicates that carried reserves remain within the top quartile of
the range of reasonable reserves.
Large losses (which the Company defines as losses greater than
$500,000 for the EMC Insurance Companies pool, excluding
catastrophe and storm losses) increased slightly to $10.3 million
($0.32 per share after tax) in the third quarter of 2015 from $9.7
million ($0.31 per share after tax) in the third quarter of 2014.
For the first nine months of 2015, large losses decreased to $21.5
million ($0.68 per share after tax) from $23.8 million ($0.77 per
share after tax) in 2014.
Net investment income declined 1.8 percent and 1.4 percent to
$11.3 million and $33.9 million for the three and nine months ended
September 30, 2015 from $11.5 million and $34.4 million for the
same periods in 2014. Net investment income for the first nine
months of 2014 included approximately $442,000 that resulted from
the early payoff of a commercial mortgage-backed security during
the first quarter of 2014 that was purchased at a significant
discount to par value, which accelerated the accretion of the
discount to par value and therefore increased investment income.
Excluding this amount, net investment income would have been
relatively flat for the first nine months of 2015 compared to the
same period in 2014.
Net realized investment gains totaled $7.5 million ($0.24 per
share after tax) and $11.6 million ($0.37 per share after tax) for
the third quarter and first nine months of 2015, compared to net
realized investment losses of $390,000 ($0.01 per share after tax)
and net realized investment gains of $3.2 million ($0.10 per share
after tax) for the same periods in 2014. Included in net realized
investment gains reported for the third quarter and first nine
months of 2015 are $7.2 million and $3.8 million, respectively, of
realized investment gains attributed to increases in the carrying
value of a limited partnership that helps protect the Company from
a sudden and significant decline in the value of its equity
portfolio (the equity tail-risk hedging strategy). Included in the
net realized investment gains/losses reported for the third quarter
and first nine months of 2014 are $917,000 and $2.1 million,
respectively, of net realized investment losses attributed to the
decline in carrying value of this limited partnership.
At September 30, 2015, consolidated assets totaled $1.6 billion,
including $1.4 billion in the investment portfolio, and
stockholders’ equity totaled $519.9 million, an increase of 3.4
percent from December 31, 2014. Book value of the Company’s stock
increased 1.5 percent to $25.09 per share from $24.72 per share at
December 31, 2014. Book value excluding accumulated other
comprehensive income increased to $22.16 per share from $20.70 per
share at December 31, 2014.
The Company will hold an earnings teleconference call at noon
Eastern time on November 6, 2015 to allow securities analysts,
stockholders and other interested parties the opportunity to hear
management discuss the Company’s results for the quarter and nine
months ended September 30, 2015, as well as its expectations for
the remainder of 2015. Dial-in information for the call is
toll-free 1-877-407-9205 (International: 1-201-689-8054).
Members of the news media, investors and the general public are
invited to access a live webcast of the conference call via the
Company’s investor relations page at www.emcins.com/ir. The webcast
will be archived and available for replay until February 6, 2015. A
transcript of the teleconference will also be available on the
Company’s website shortly after the completion of the
teleconference.
About EMCI:
EMC Insurance Group Inc. is a publicly held insurance holding
company with operations in property and casualty insurance and
reinsurance, which was formed in 1974 and became publicly held in
1982. The Company’s common stock trades on the Global Select Market
tier of the NASDAQ OMX Stock Market under the symbol EMCI.
Additional information regarding EMC Insurance Group Inc. may be
found at www.emcins.com/ir. EMCI’s parent company is Employers
Mutual Casualty Company (EMCC). EMCI and EMCC, together with their
subsidiary and affiliated companies, conduct operations under the
trade name EMC Insurance Companies.
Cautionary Note Regarding Forward-Looking
Statements:
The Private Securities Litigation Reform Act of 1995 provides
issuers the opportunity to make cautionary statements regarding
forward-looking statements. Accordingly, any forward-looking
statement contained in this report is based on management’s current
beliefs, assumptions and expectations of the Company’s future
performance, taking into account all information currently
available to management. These beliefs, assumptions and
expectations can change as the result of many possible events or
factors, not all of which are known to management. If a change
occurs, the Company’s business, financial condition, liquidity,
results of operations, plans and objectives may vary materially
from those expressed in the forward-looking statements.
The risks and uncertainties that may affect the actual results
of the Company include, but are not limited to, the following:
- catastrophic events and the occurrence of significant severe
weather conditions;
- the adequacy of loss and settlement expense reserves;
- state and federal legislation and regulations;
- changes in the property and casualty insurance industry,
interest rates or the performance of financial markets and the
general economy;
- rating agency actions;
- “other-than-temporary” investment impairment losses; and
- other risks and uncertainties inherent to the Company’s
business, including those discussed under the heading “Risk
Factors” in the Company’s Annual Report on Form 10-K.
Management intends to identify forward-looking statements when
using the words “believe,” “expect,” “anticipate,” “estimate,”
“project,” or similar expressions. Undue reliance should not be
placed on these forward-looking statements. The Company disclaims
any obligation to update such statements or to announce publicly
the results of any revisions that it may make to any
forward-looking statements to reflect the occurrence of anticipated
or unanticipated events or circumstances after the date of such
statements.
¹The Company prepares its public financial statements in
conformity with accounting principles generally accepted in the
Unites States of America (GAAP). Operating income is a non-GAAP
financial measure, calculated by excluding net realized investment
gains/losses from net income. The Company’s calculation of
operating income may differ from similar measures used by other
companies, so investors should exercise caution when comparing the
Company’s measure of operating income to the measure of other
companies. Management’s projected operating income guidance is also
considered a non-GAAP financial measure.
Management believes operating income is useful to investors
because it illustrates the performance of our normal, ongoing
operations, which is important in understanding and evaluating our
financial condition and results of operations. While this measure
is consistent with measures utilized by investors to evaluate
performance, it is not a substitute for the GAAP financial measure
of net income. Therefore, the Company has provided the following
reconciliation of the non-GAAP financial measure of operating
income to the GAAP financial measure of net income. Management also
uses non-GAAP financial measures for goal setting, determining
employee and senior management awards and compensation, and
evaluating performance.
The reconciliation of operating income to net income is as
follows:
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2015 |
|
|
|
2014 |
|
|
|
2015 |
|
|
|
2014 |
|
($ in thousands) |
|
|
|
|
|
|
|
Operating income |
$ |
6,315 |
|
|
$ |
2,482 |
|
|
$ |
32,756 |
|
|
$ |
11,748 |
|
Net realized investment
gains (losses) |
|
4,874 |
|
|
|
(253 |
) |
|
|
7,511 |
|
|
|
2,090 |
|
Net income |
$ |
11,189 |
|
|
$ |
2,229 |
|
|
$ |
40,267 |
|
|
$ |
13,838 |
|
|
|
|
|
|
|
|
|
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED |
|
|
|
|
|
|
|
($ in thousands, except
share and per share amounts) |
|
|
|
|
|
|
|
|
|
|
|
Property and |
|
|
|
|
|
|
|
|
|
Casualty |
|
|
|
Parent |
|
|
|
Quarter
Ended September 30, 2015 |
|
Insurance |
|
Reinsurance |
|
Company |
|
Consolidated |
|
Revenues: |
|
|
|
|
|
|
|
|
|
Premiums earned |
|
$ |
113,753 |
|
|
$ |
32,035 |
|
|
$ |
- |
|
|
$ |
145,788 |
|
|
Investment income, net |
|
|
8,125 |
|
|
|
3,176 |
|
|
|
(2 |
) |
|
|
11,299 |
|
|
Other income |
|
|
210 |
|
|
|
309 |
|
|
|
- |
|
|
|
519 |
|
|
|
|
|
122,088 |
|
|
|
35,520 |
|
|
|
(2 |
) |
|
|
157,606 |
|
|
Losses and
expenses: |
|
|
|
|
|
|
|
|
Losses and settlement expenses |
|
|
75,976 |
|
|
|
26,709 |
|
|
|
- |
|
|
|
102,685 |
|
|
Dividends to policyholders |
|
|
3,555 |
|
|
|
- |
|
|
|
- |
|
|
|
3,555 |
|
|
Amortization of deferred policy
acquisition costs |
|
|
18,736 |
|
|
|
7,403 |
|
|
|
- |
|
|
|
26,139 |
|
|
Other underwriting expenses |
|
|
15,587 |
|
|
|
458 |
|
|
|
- |
|
|
|
16,045 |
|
|
Interest expense |
|
|
84 |
|
|
|
- |
|
|
|
- |
|
|
|
84 |
|
|
Other expenses |
|
|
196 |
|
|
|
- |
|
|
|
479 |
|
|
|
675 |
|
|
|
|
|
114,134 |
|
|
|
34,570 |
|
|
|
479 |
|
|
|
149,183 |
|
|
Operating income (loss) before
income taxes |
|
|
7,954 |
|
|
|
950 |
|
|
|
(481 |
) |
|
|
8,423 |
|
|
Realized investment
gains |
|
|
4,889 |
|
|
|
2,609 |
|
|
|
- |
|
|
|
7,498 |
|
|
Income (loss) before income
taxes |
|
|
12,843 |
|
|
|
3,559 |
|
|
|
(481 |
) |
|
|
15,921 |
|
|
Income tax expense
(benefit): |
|
|
|
|
|
|
|
|
Current |
|
|
2,743 |
|
|
|
507 |
|
|
|
(169 |
) |
|
|
3,081 |
|
|
Deferred |
|
|
1,235 |
|
|
|
416 |
|
|
|
- |
|
|
|
1,651 |
|
|
|
|
|
3,978 |
|
|
|
923 |
|
|
|
(169 |
) |
|
|
4,732 |
|
|
Net Income (loss) |
|
$ |
8,865 |
|
|
$ |
2,636 |
|
|
$ |
(312 |
) |
|
$ |
11,189 |
|
|
Average shares
outstanding |
|
|
|
|
|
|
|
20,684,890 |
|
|
Per Share Data: |
|
|
|
|
|
|
|
|
Net income (loss) per share - basic
and diluted |
|
$ |
0.43 |
|
|
$ |
0.12 |
|
|
$ |
(0.01 |
) |
|
$ |
0.54 |
|
|
Catastrophe and storm losses (after
tax) |
|
$ |
0.31 |
|
|
$ |
0.25 |
|
|
$ |
- |
|
|
$ |
0.56 |
|
|
Large losses* (after tax) |
|
$ |
0.32 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
0.32 |
|
|
Reported (adverse) favorable
development |
|
|
|
|
|
|
|
|
experienced on prior
years' reserves (after tax) |
$ |
0.15 |
|
|
$ |
(0.08 |
) |
|
$ |
- |
|
|
$ |
0.07 |
|
|
Dividends per share
|
|
|
|
|
|
|
$ |
0.170 |
|
|
Other Information of
Interest: |
|
|
|
|
|
|
|
|
Net written premiums
|
|
$ |
134,722 |
|
|
$ |
31,446 |
|
|
$ |
- |
|
|
$ |
166,168 |
|
|
Catastrophe and storm losses
|
|
$ |
9,920 |
|
|
$ |
7,844 |
|
|
$ |
- |
|
|
$ |
17,764 |
|
|
Large losses* |
|
$ |
10,304 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
10,304 |
|
|
Reported adverse (favorable)
development |
|
|
|
|
|
|
|
|
|
experienced on prior years'
reserves |
|
$ |
(4,722 |
) |
|
$ |
2,495 |
|
|
$ |
- |
|
|
$ |
(2,227 |
) |
|
GAAP Ratios: |
|
|
|
|
|
|
|
|
Loss and settlement expense
ratio |
|
|
66.8 |
% |
|
|
83.4 |
% |
|
|
- |
|
|
|
70.4 |
% |
|
Acquisition expense ratio |
|
|
33.3 |
% |
|
|
24.5 |
% |
|
|
- |
|
|
|
31.4 |
% |
|
Combined ratio |
|
|
100.1 |
% |
|
|
107.9 |
% |
|
|
- |
|
|
|
101.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
*Large losses are defined as losses greater than $500 for the
EMC Insurance Companies pool, excluding catastrophe and storm
losses. |
|
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED |
|
|
|
|
|
|
|
($ in thousands, except
share and per share amounts) |
|
|
|
|
|
|
|
|
|
|
|
Property and |
|
|
|
|
|
|
|
|
|
Casualty |
|
|
|
Parent |
|
|
|
Quarter
Ended September 30, 2014 |
|
Insurance |
|
Reinsurance |
|
Company |
|
Consolidated |
|
Revenues: |
|
|
|
|
|
|
|
|
|
Premiums earned |
|
$ |
107,952 |
|
|
$ |
30,364 |
|
|
$ |
- |
|
|
$ |
138,316 |
|
|
Investment income, net |
|
|
8,230 |
|
|
|
3,275 |
|
|
|
(2 |
) |
|
|
11,503 |
|
|
Other income |
|
|
202 |
|
|
|
1,028 |
|
|
|
- |
|
|
|
1,230 |
|
|
|
|
|
116,384 |
|
|
|
34,667 |
|
|
|
(2 |
) |
|
|
151,049 |
|
|
Losses and
expenses: |
|
|
|
|
|
|
|
|
Losses and settlement expenses |
|
|
78,556 |
|
|
|
28,096 |
|
|
|
- |
|
|
|
106,652 |
|
|
Dividends to policyholders |
|
|
2,588 |
|
|
|
- |
|
|
|
- |
|
|
|
2,588 |
|
|
Amortization of deferred policy
acquisition costs |
|
|
18,143 |
|
|
|
6,814 |
|
|
|
- |
|
|
|
24,957 |
|
|
Other underwriting expenses |
|
|
13,079 |
|
|
|
828 |
|
|
|
- |
|
|
|
13,907 |
|
|
Interest expense |
|
|
84 |
|
|
|
- |
|
|
|
- |
|
|
|
84 |
|
|
Other expenses |
|
|
132 |
|
|
|
- |
|
|
|
456 |
|
|
|
588 |
|
|
|
|
|
112,582 |
|
|
|
35,738 |
|
|
|
456 |
|
|
|
148,776 |
|
|
Operating income (loss) before
income taxes |
|
|
3,802 |
|
|
|
(1,071 |
) |
|
|
(458 |
) |
|
|
2,273 |
|
|
Realized investment
losses |
|
|
(286 |
) |
|
|
(104 |
) |
|
|
- |
|
|
|
(390 |
) |
|
Income (loss) before income
taxes |
|
|
3,516 |
|
|
|
(1,175 |
) |
|
|
(458 |
) |
|
|
1,883 |
|
|
Income tax expense
(benefit): |
|
|
|
|
|
|
|
|
Current |
|
|
(304 |
) |
|
|
(988 |
) |
|
|
(160 |
) |
|
|
(1,452 |
) |
|
Deferred |
|
|
759 |
|
|
|
347 |
|
|
|
- |
|
|
|
1,106 |
|
|
|
|
|
455 |
|
|
|
(641 |
) |
|
|
(160 |
) |
|
|
(346 |
) |
|
Net Income (loss) |
|
$ |
3,061 |
|
|
$ |
(534 |
) |
|
$ |
(298 |
) |
|
$ |
2,229 |
|
|
Average shares
outstanding |
|
|
|
|
|
|
|
20,267,538 |
|
|
Per Share Data: |
|
|
|
|
|
|
|
|
Net income (loss) per share - basic
and diluted |
|
$ |
0.15 |
|
|
$ |
(0.03 |
) |
|
$ |
(0.01 |
) |
|
$ |
0.11 |
|
|
Catastrophe and storm losses (after
tax) |
|
$ |
0.32 |
|
|
$ |
0.24 |
|
|
$ |
- |
|
|
$ |
0.56 |
|
|
Large losses* (after tax) |
|
$ |
0.31 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
0.31 |
|
|
Reported favorable development |
|
|
|
|
|
|
|
|
experienced on prior
years' reserves (after tax) |
$ |
0.02 |
|
|
$ |
0.04 |
|
|
$ |
- |
|
|
$ |
0.06 |
|
|
Dividends per share
|
|
|
|
|
|
|
$ |
0.153 |
|
|
Other Information of
Interest: |
|
|
|
|
|
|
|
|
Net written premiums
|
|
$ |
131,005 |
|
|
$ |
31,824 |
|
|
$ |
- |
|
|
$ |
162,829 |
|
|
Catastrophe and storm losses
|
|
$ |
10,064 |
|
|
$ |
7,415 |
|
|
$ |
- |
|
|
$ |
17,479 |
|
|
Large losses* |
|
$ |
9,673 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
9,673 |
|
|
Reported favorable development |
|
|
|
|
|
|
|
|
|
experienced on prior years'
reserves |
|
$ |
(427 |
) |
|
$ |
(1,264 |
) |
|
$ |
- |
|
|
$ |
(1,691 |
) |
|
GAAP Ratios: |
|
|
|
|
|
|
|
|
Loss and settlement expense
ratio |
|
|
72.8 |
% |
|
|
92.5 |
% |
|
|
- |
|
|
|
77.1 |
% |
|
Acquisition expense ratio |
|
|
31.3 |
% |
|
|
25.2 |
% |
|
|
- |
|
|
|
30.0 |
% |
|
Combined ratio |
|
|
104.1 |
% |
|
|
117.7 |
% |
|
|
- |
|
|
|
107.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
*Large losses are defined as losses greater than $500 for the
EMC Insurance Companies pool, excluding catastrophe and storm
losses. |
|
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED |
|
|
|
|
|
|
|
($ in thousands, except
share and per share amounts) |
|
|
|
|
|
|
|
|
|
|
|
Property and |
|
|
|
|
|
|
|
|
|
Casualty |
|
|
|
Parent |
|
|
|
Nine
Months Ended September 30, 2015 |
|
Insurance |
|
Reinsurance |
|
Company |
|
Consolidated |
|
Revenues: |
|
|
|
|
|
|
|
|
|
Premiums earned |
|
$ |
333,212 |
|
|
$ |
95,912 |
|
|
$ |
- |
|
|
$ |
429,124 |
|
|
Investment income, net
|
|
|
24,301 |
|
|
|
9,654 |
|
|
|
(9 |
) |
|
|
33,946 |
|
|
Other income |
|
|
582 |
|
|
|
1,040 |
|
|
|
- |
|
|
|
1,622 |
|
|
|
|
|
358,095 |
|
|
|
106,606 |
|
|
|
(9 |
) |
|
|
464,692 |
|
|
Losses and
expenses: |
|
|
|
|
|
|
|
|
Losses and settlement
expenses |
|
|
215,468 |
|
|
|
65,135 |
|
|
|
- |
|
|
|
280,603 |
|
|
Dividends to policyholders
|
|
|
6,492 |
|
|
|
- |
|
|
|
- |
|
|
|
6,492 |
|
|
Amortization of deferred policy
acquisition costs |
|
|
56,003 |
|
|
|
22,820 |
|
|
|
- |
|
|
|
78,823 |
|
|
Other underwriting expenses
|
|
|
47,784 |
|
|
|
2,567 |
|
|
|
- |
|
|
|
50,351 |
|
|
Interest expense |
|
|
253 |
|
|
|
- |
|
|
|
- |
|
|
|
253 |
|
|
Other expenses |
|
|
568 |
|
|
|
- |
|
|
|
1,424 |
|
|
|
1,992 |
|
|
|
|
|
326,568 |
|
|
|
90,522 |
|
|
|
1,424 |
|
|
|
418,514 |
|
|
Operating income (loss) before
income taxes |
|
|
31,527 |
|
|
|
16,084 |
|
|
|
(1,433 |
) |
|
|
46,178 |
|
|
Realized investment
gains |
|
|
7,866 |
|
|
|
3,689 |
|
|
|
- |
|
|
|
11,555 |
|
|
Income (loss) before income
taxes |
|
|
39,393 |
|
|
|
19,773 |
|
|
|
(1,433 |
) |
|
|
57,733 |
|
|
Income tax expense
(benefit): |
|
|
|
|
|
|
|
|
Current |
|
|
10,513 |
|
|
|
5,583 |
|
|
|
(502 |
) |
|
|
15,594 |
|
|
Deferred |
|
|
1,312 |
|
|
|
560 |
|
|
|
- |
|
|
|
1,872 |
|
|
|
|
|
11,825 |
|
|
|
6,143 |
|
|
|
(502 |
) |
|
|
17,466 |
|
|
Net income (loss) |
|
$ |
27,568 |
|
|
$ |
13,630 |
|
|
$ |
(931 |
) |
|
$ |
40,267 |
|
|
Average shares
outstanding |
|
|
|
|
|
|
|
20,577,493 |
|
|
Per Share Data: |
|
|
|
|
|
|
|
|
Net income (loss) per share - basic
and diluted |
|
$ |
1.34 |
|
|
$ |
0.66 |
|
|
$ |
(0.04 |
) |
|
$ |
1.96 |
|
|
Catastrophe and storm losses (after
tax) |
|
$ |
0.91 |
|
|
$ |
0.38 |
|
|
$ |
- |
|
|
$ |
1.29 |
|
|
Large losses* (after tax) |
|
$ |
0.68 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
0.68 |
|
|
Reported favorable development
experienced on |
|
|
|
|
|
|
|
|
prior years' reserves (after
tax) |
|
$ |
0.45 |
|
|
$ |
0.18 |
|
|
$ |
- |
|
|
$ |
0.63 |
|
|
Dividends per share
|
|
|
|
|
|
|
$ |
0.503 |
|
|
Book value per
share |
|
|
|
|
|
|
$ |
25.09 |
|
|
Effective tax rate |
|
|
|
|
|
|
|
30.3 |
% |
|
Annualized net income as a percent of beg. SH equity |
|
|
|
|
|
|
|
|
10.7 |
% |
|
Other Information of
Interest: |
|
|
|
|
|
|
|
|
Net written premiums
|
|
$ |
364,329 |
|
|
$ |
96,914 |
|
|
$ |
- |
|
|
$ |
461,243 |
|
|
Catastrophe and storm losses
|
|
$ |
28,651 |
|
|
$ |
12,104 |
|
|
$ |
- |
|
|
$ |
40,755 |
|
|
Large losses* |
|
$ |
21,453 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
21,453 |
|
|
Reported favorable development
experienced on |
|
|
|
|
|
|
|
|
|
prior years' reserves |
|
$ |
(14,177 |
) |
|
$ |
(5,780 |
) |
|
$ |
- |
|
|
$ |
(19,957 |
) |
|
GAAP Ratios: |
|
|
|
|
|
|
|
|
Loss and settlement expense
ratio |
|
|
64.7 |
% |
|
|
67.9 |
% |
|
|
- |
|
|
|
65.4 |
% |
|
Acquisition expense ratio |
|
|
33.1 |
% |
|
|
26.5 |
% |
|
|
- |
|
|
|
31.6 |
% |
|
Combined ratio |
|
|
97.8 |
% |
|
|
94.4 |
% |
|
|
- |
|
|
|
97.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
*Large losses are defined as losses greater than $500 for the
EMC Insurance Companies pool, excluding catastrophe and storm
losses. |
|
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED |
|
|
|
|
|
|
|
($ in thousands, except
share and per share amounts) |
|
|
|
|
|
|
|
|
|
|
|
Property and |
|
|
|
|
|
|
|
|
|
Casualty |
|
|
|
Parent |
|
|
|
Nine
Months Ended September 30, 2014 |
|
Insurance |
|
Reinsurance |
|
Company |
|
Consolidated |
|
Revenues: |
|
|
|
|
|
|
|
|
|
Premiums earned |
|
$ |
312,716 |
|
|
$ |
92,632 |
|
|
$ |
- |
|
|
$ |
405,348 |
|
|
Investment income, net |
|
|
24,818 |
|
|
|
9,624 |
|
|
|
(8 |
) |
|
|
34,434 |
|
|
Other income |
|
|
584 |
|
|
|
1,042 |
|
|
|
- |
|
|
|
1,626 |
|
|
|
|
|
338,118 |
|
|
|
103,298 |
|
|
|
(8 |
) |
|
|
441,408 |
|
|
Losses and
expenses: |
|
|
|
|
|
|
|
|
Losses and settlement expenses |
|
|
227,069 |
|
|
|
74,398 |
|
|
|
- |
|
|
|
301,467 |
|
|
Dividends to policyholders |
|
|
6,517 |
|
|
|
- |
|
|
|
- |
|
|
|
6,517 |
|
|
Amortization of deferred policy
acquisition costs |
|
|
53,895 |
|
|
|
20,795 |
|
|
|
- |
|
|
|
74,690 |
|
|
Other underwriting expenses |
|
|
41,103 |
|
|
|
1,838 |
|
|
|
- |
|
|
|
42,941 |
|
|
Interest expense |
|
|
253 |
|
|
|
- |
|
|
|
- |
|
|
|
253 |
|
|
Other expenses |
|
|
540 |
|
|
|
- |
|
|
|
1,173 |
|
|
|
1,713 |
|
|
|
|
|
329,377 |
|
|
|
97,031 |
|
|
|
1,173 |
|
|
|
427,581 |
|
|
Operating income (loss) before
income taxes |
|
|
8,741 |
|
|
|
6,267 |
|
|
|
(1,181 |
) |
|
|
13,827 |
|
|
Realized investment
gains |
|
|
2,293 |
|
|
|
922 |
|
|
|
- |
|
|
|
3,215 |
|
|
Income (loss) before income
taxes |
|
|
11,034 |
|
|
|
7,189 |
|
|
|
(1,181 |
) |
|
|
17,042 |
|
|
Income tax expense
(benefit): |
|
|
|
|
|
|
|
|
Current |
|
|
1,546 |
|
|
|
1,716 |
|
|
|
(414 |
) |
|
|
2,848 |
|
|
Deferred |
|
|
315 |
|
|
|
41 |
|
|
|
- |
|
|
|
356 |
|
|
|
|
|
1,861 |
|
|
|
1,757 |
|
|
|
(414 |
) |
|
|
3,204 |
|
|
Net Income (loss) |
|
$ |
9,173 |
|
|
$ |
5,432 |
|
|
$ |
(767 |
) |
|
$ |
13,838 |
|
|
Average shares
outstanding |
|
|
|
|
|
|
|
20,165,697 |
|
|
Per Share Data: |
|
|
|
|
|
|
|
|
Net income (loss) per share - basic
and diluted |
|
$ |
0.46 |
|
|
$ |
0.27 |
|
|
$ |
(0.04 |
) |
|
$ |
0.69 |
|
|
Catastrophe and storm losses (after
tax) |
|
$ |
1.24 |
|
|
$ |
0.46 |
|
|
$ |
- |
|
|
$ |
1.70 |
|
|
Large losses* (after tax) |
|
$ |
0.77 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
0.77 |
|
|
Reported favorable development |
|
|
|
|
|
|
|
|
experienced on prior
years' reserves (after tax) |
$ |
0.20 |
|
|
$ |
0.15 |
|
|
$ |
- |
|
|
$ |
0.35 |
|
|
Dividends per share
|
|
|
|
|
|
|
$ |
0.460 |
|
|
Book value per
share |
|
|
|
|
|
|
$ |
23.93 |
|
|
Effective tax rate |
|
|
|
|
|
|
|
18.8 |
% |
|
Annualized net income as a percent of beg. SH equity |
|
|
|
|
|
|
|
|
3.9 |
% |
|
Other Information of
Interest: |
|
|
|
|
|
|
|
|
Net written premiums
|
|
$ |
345,982 |
|
|
$ |
91,276 |
|
|
$ |
- |
|
|
$ |
437,258 |
|
|
Catastrophe and storm losses
|
|
$ |
38,501 |
|
|
$ |
14,335 |
|
|
$ |
- |
|
|
$ |
52,836 |
|
|
Large losses* |
|
$ |
23,782 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
23,782 |
|
|
Reported favorable development |
|
|
|
|
|
|
|
|
|
experienced on prior years'
reserves |
|
$ |
(6,106 |
) |
|
$ |
(4,816 |
) |
|
$ |
- |
|
|
$ |
(10,922 |
) |
|
GAAP Ratios: |
|
|
|
|
|
|
|
|
Loss and settlement expense
ratio |
|
|
72.6 |
% |
|
|
80.3 |
% |
|
|
- |
|
|
|
74.4 |
% |
|
Acquisition expense ratio |
|
|
32.5 |
% |
|
|
24.4 |
% |
|
|
- |
|
|
|
30.6 |
% |
|
Combined ratio |
|
|
105.1 |
% |
|
|
104.7 |
% |
|
|
- |
|
|
|
105.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
*Large losses are defined as losses greater than $500 for the
EMC Insurance Companies pool, excluding catastrophe and storm
losses. |
|
CONSOLIDATED BALANCE SHEETS |
|
|
|
|
|
September 30, |
|
December 31, |
|
|
|
2015 |
|
|
|
2014 |
|
|
($ in thousands, except
share and per share amounts) |
(Unaudited) |
|
|
|
ASSETS |
|
|
|
|
Investments: |
|
|
|
|
Fixed maturity securities
available-for-sale, at fair value |
|
|
|
|
(amortized cost $1,139,373 and
$1,080,006) |
$ |
1,177,961 |
|
|
$ |
1,127,499 |
|
|
Equity securities
available-for-sale, at fair value |
|
|
|
|
(cost $142,941 and $123,972) |
|
194,305 |
|
|
|
197,036 |
|
|
Other long-term investments |
|
15,396 |
|
|
|
6,227 |
|
|
Short-term investments |
|
32,798 |
|
|
|
53,262 |
|
|
Total investments |
|
1,420,460 |
|
|
|
1,384,024 |
|
|
|
|
|
|
|
Cash |
|
570 |
|
|
|
383 |
|
|
Reinsurance receivables
due from affiliate |
|
25,399 |
|
|
|
28,603 |
|
|
Prepaid reinsurance
premiums due from affiliate |
|
7,638 |
|
|
|
8,865 |
|
|
Deferred
policy acquisition costs (affiliated $44,559 and $38,930) |
|
44,710 |
|
|
|
39,343 |
|
|
Prepaid
pension and postretirement benefits due from affiliate |
|
18,162 |
|
|
|
17,360 |
|
|
Accrued investment
income |
|
11,716 |
|
|
|
10,295 |
|
|
Amounts receivable
under reverse repurchase agreements |
|
16,850 |
|
|
|
- |
|
|
Accounts
receivable |
|
1,402 |
|
|
|
1,767 |
|
|
Income taxes
recoverable |
|
2,657 |
|
|
|
- |
|
|
Goodwill |
|
942 |
|
|
|
942 |
|
|
Other assets
(affiliated $4,611 and $4,900) |
|
5,019 |
|
|
|
6,238 |
|
|
Total assets |
$ |
1,555,525 |
|
|
$ |
1,497,820 |
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
Losses and settlement
expenses (affiliated $675,247 and $650,652) |
$ |
683,930 |
|
|
$ |
661,309 |
|
|
Unearned premiums
(affiliated $263,096 and $230,460) |
|
263,686 |
|
|
|
232,093 |
|
|
Other policyholders'
funds (all affiliated) |
|
8,593 |
|
|
|
10,153 |
|
|
Surplus notes payable
to affiliate |
|
25,000 |
|
|
|
25,000 |
|
|
Amounts due affiliate
to settle inter-company transaction balances |
|
7,347 |
|
|
|
8,559 |
|
|
Pension benefits
payable to affiliate |
|
4,082 |
|
|
|
4,162 |
|
|
Income taxes
payable |
|
- |
|
|
|
3 |
|
|
Deferred income
taxes |
|
19,295 |
|
|
|
28,654 |
|
|
Other liabilities
(affiliated $23,547 and $23,941) |
|
23,659 |
|
|
|
25,001 |
|
|
Total liabilities |
|
1,035,592 |
|
|
|
994,934 |
|
|
|
|
|
|
|
STOCKHOLDERS' EQUITY |
|
|
|
|
Common stock, $1 par
value, authorized 30,000,000 |
|
|
|
|
shares; issued and outstanding,
20,720,855 |
|
|
|
|
shares in 2015 and 20,344,409
shares in 2014 |
|
20,721 |
|
|
|
20,344 |
|
|
Additional paid-in
capital |
|
107,426 |
|
|
|
99,891 |
|
|
Accumulated other
comprehensive income |
|
60,804 |
|
|
|
81,662 |
|
|
Retained earnings |
|
330,982 |
|
|
|
300,989 |
|
|
Total stockholders' equity |
|
519,933 |
|
|
|
502,886 |
|
|
Total liabilities and stockholders'
equity |
$ |
1,555,525 |
|
|
$ |
1,497,820 |
|
|
LOSS AND SETTLEMENT EXPENSE BY LINE OF
BUSINESS |
|
|
|
|
|
|
|
|
|
|
Three months ended September 30, |
|
|
|
2015 |
|
|
|
2014 |
|
($ in thousands) |
|
Premiums earned |
|
Losses and settlement expenses |
|
Loss and settlement expense ratio |
|
Premiums earned |
|
Losses and settlement expenses |
|
Loss and settlement expense ratio |
Property and casualty
insurance |
|
|
|
|
|
|
|
|
|
|
|
|
Commercial lines: |
|
|
|
|
|
|
|
|
|
|
|
|
Automobile |
|
$ |
27,080 |
|
|
$ |
24,555 |
|
|
|
90.7 |
% |
|
$ |
25,000 |
|
|
$ |
21,974 |
|
|
|
87.9 |
% |
Property |
|
|
26,526 |
|
|
|
19,290 |
|
|
|
72.7 |
% |
|
|
25,111 |
|
|
|
18,191 |
|
|
|
72.4 |
% |
Workers' compensation |
|
|
23,777 |
|
|
|
12,098 |
|
|
|
50.9 |
% |
|
|
22,209 |
|
|
|
11,582 |
|
|
|
52.2 |
% |
Liability |
|
|
23,449 |
|
|
|
10,726 |
|
|
|
45.7 |
% |
|
|
22,090 |
|
|
|
18,450 |
|
|
|
83.5 |
% |
Other |
|
|
2,032 |
|
|
|
348 |
|
|
|
17.1 |
% |
|
|
1,881 |
|
|
|
220 |
|
|
|
11.7 |
% |
Total commercial lines |
|
|
102,864 |
|
|
|
67,017 |
|
|
|
65.2 |
% |
|
|
96,291 |
|
|
|
70,417 |
|
|
|
73.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Personal lines: |
|
|
|
|
|
|
|
|
|
|
|
|
Automobile |
|
|
5,717 |
|
|
|
4,717 |
|
|
|
82.5 |
% |
|
|
6,284 |
|
|
|
4,287 |
|
|
|
68.2 |
% |
Homeowners |
|
|
5,172 |
|
|
|
4,242 |
|
|
|
82.0 |
% |
|
|
5,377 |
|
|
|
3,852 |
|
|
|
71.6 |
% |
Total personal lines |
|
|
10,889 |
|
|
|
8,959 |
|
|
|
82.3 |
% |
|
|
11,661 |
|
|
|
8,139 |
|
|
|
69.8 |
% |
Total property and casualty |
|
|
|
|
|
|
|
|
|
|
|
|
insurance |
|
$ |
113,753 |
|
|
$ |
75,976 |
|
|
|
66.8 |
% |
|
$ |
107,952 |
|
|
$ |
78,556 |
|
|
|
72.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Reinsurance |
|
|
|
|
|
|
|
|
|
|
|
|
Pro rata reinsurance: |
|
|
|
|
|
|
|
|
|
|
|
|
Multiline (primarily property) |
|
$ |
1,190 |
|
|
$ |
747 |
|
|
|
62.8 |
% |
|
$ |
700 |
|
|
$ |
957 |
|
|
|
136.8 |
% |
Property |
|
|
4,162 |
|
|
|
3,894 |
|
|
|
93.6 |
% |
|
|
2,622 |
|
|
|
3,838 |
|
|
|
146.4 |
% |
Liability |
|
|
4,787 |
|
|
|
3,137 |
|
|
|
65.6 |
% |
|
|
3,148 |
|
|
|
1,289 |
|
|
|
40.9 |
% |
Marine |
|
|
2,898 |
|
|
|
1,889 |
|
|
|
65.2 |
% |
|
|
3,502 |
|
|
|
3,576 |
|
|
|
102.1 |
% |
Total pro rata reinsurance |
|
|
13,037 |
|
|
|
9,667 |
|
|
|
74.2 |
% |
|
|
9,972 |
|
|
|
9,660 |
|
|
|
96.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Excess of loss reinsurance: |
|
|
|
|
|
|
|
|
|
|
|
|
Property |
|
|
16,249 |
|
|
|
13,524 |
|
|
|
83.2 |
% |
|
|
17,248 |
|
|
|
16,108 |
|
|
|
93.4 |
% |
Liability |
|
|
2,749 |
|
|
|
3,518 |
|
|
|
128.0 |
% |
|
|
3,144 |
|
|
|
2,328 |
|
|
|
74.1 |
% |
Total excess of loss
reinsurance |
|
|
18,998 |
|
|
|
17,042 |
|
|
|
89.7 |
% |
|
|
20,392 |
|
|
|
18,436 |
|
|
|
90.0 |
% |
Total reinsurance |
|
$ |
32,035 |
|
|
$ |
26,709 |
|
|
|
83.4 |
% |
|
$ |
30,364 |
|
|
$ |
28,096 |
|
|
|
92.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated |
|
$ |
145,788 |
|
|
$ |
102,685 |
|
|
|
70.4 |
% |
|
$ |
138,316 |
|
|
$ |
106,652 |
|
|
|
77.1 |
% |
LOSS AND SETTLEMENT EXPENSE BY LINE OF
BUSINESS |
|
|
|
|
|
|
|
|
|
|
Nine months ended September 30, |
|
|
|
2015 |
|
|
|
2014 |
|
($ in thousands) |
|
Premiums earned |
|
Losses and settlement expenses |
|
Loss and settlement expense ratio |
|
Premiums earned |
|
Losses and settlement expenses |
|
Loss and settlement expense ratio |
Property and casualty
insurance |
|
|
|
|
|
|
|
|
|
|
|
|
Commercial lines: |
|
|
|
|
|
|
|
|
|
|
|
|
Automobile |
|
$ |
78,698 |
|
|
$ |
61,843 |
|
|
|
78.6 |
% |
|
$ |
71,657 |
|
|
$ |
56,864 |
|
|
|
79.4 |
% |
Property |
|
|
77,518 |
|
|
|
53,652 |
|
|
|
69.2 |
% |
|
|
71,756 |
|
|
|
57,891 |
|
|
|
80.7 |
% |
Workers' compensation |
|
|
69,150 |
|
|
|
39,591 |
|
|
|
57.3 |
% |
|
|
65,172 |
|
|
|
38,131 |
|
|
|
58.5 |
% |
Liability |
|
|
68,952 |
|
|
|
34,668 |
|
|
|
50.3 |
% |
|
|
63,600 |
|
|
|
42,957 |
|
|
|
67.5 |
% |
Other |
|
|
6,044 |
|
|
|
794 |
|
|
|
13.1 |
% |
|
|
5,472 |
|
|
|
705 |
|
|
|
12.9 |
% |
Total commercial lines |
|
|
300,362 |
|
|
|
190,548 |
|
|
|
63.4 |
% |
|
|
277,657 |
|
|
|
196,548 |
|
|
|
70.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Personal
lines: |
|
|
|
|
|
|
|
|
|
|
|
|
Automobile |
|
|
17,313 |
|
|
|
12,013 |
|
|
|
69.4 |
% |
|
|
18,999 |
|
|
|
14,473 |
|
|
|
76.2 |
% |
Homeowners |
|
|
15,537 |
|
|
|
12,907 |
|
|
|
83.1 |
% |
|
|
16,060 |
|
|
|
16,048 |
|
|
|
99.9 |
% |
Total personal lines |
|
|
32,850 |
|
|
|
24,920 |
|
|
|
75.9 |
% |
|
|
35,059 |
|
|
|
30,521 |
|
|
|
87.1 |
% |
Total property and casualty |
|
|
|
|
|
|
|
|
|
|
|
|
insurance |
|
$ |
333,212 |
|
|
$ |
215,468 |
|
|
|
64.7 |
% |
|
$ |
312,716 |
|
|
$ |
227,069 |
|
|
|
72.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Reinsurance |
|
|
|
|
|
|
|
|
|
|
|
|
Pro rata reinsurance: |
|
|
|
|
|
|
|
|
|
|
|
|
Multiline (primarily property) |
|
$ |
4,584 |
|
|
$ |
1,180 |
|
|
|
25.7 |
% |
|
$ |
5,031 |
|
|
$ |
3,570 |
|
|
|
71.0 |
% |
Property |
|
|
11,877 |
|
|
|
13,151 |
|
|
|
110.7 |
% |
|
|
9,929 |
|
|
|
10,112 |
|
|
|
101.8 |
% |
Liability |
|
|
13,955 |
|
|
|
8,701 |
|
|
|
62.4 |
% |
|
|
8,661 |
|
|
|
4,983 |
|
|
|
57.5 |
% |
Marine |
|
|
9,738 |
|
|
|
436 |
|
|
|
4.5 |
% |
|
|
11,721 |
|
|
|
6,700 |
|
|
|
57.2 |
% |
Total pro rata reinsurance |
|
|
40,154 |
|
|
|
23,468 |
|
|
|
58.4 |
% |
|
|
35,342 |
|
|
|
25,365 |
|
|
|
71.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Excess
of loss reinsurance: |
|
|
|
|
|
|
|
|
|
|
|
|
Property |
|
|
46,425 |
|
|
|
32,041 |
|
|
|
69.0 |
% |
|
|
48,507 |
|
|
|
47,240 |
|
|
|
97.4 |
% |
Liability |
|
|
9,333 |
|
|
|
9,626 |
|
|
|
103.1 |
% |
|
|
8,783 |
|
|
|
1,793 |
|
|
|
20.4 |
% |
Total excess of loss
reinsurance |
|
|
55,758 |
|
|
|
41,667 |
|
|
|
74.7 |
% |
|
|
57,290 |
|
|
|
49,033 |
|
|
|
85.6 |
% |
Total reinsurance |
|
$ |
95,912 |
|
|
$ |
65,135 |
|
|
|
67.9 |
% |
|
$ |
92,632 |
|
|
$ |
74,398 |
|
|
|
80.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated |
|
$ |
429,124 |
|
|
$ |
280,603 |
|
|
|
65.4 |
% |
|
$ |
405,348 |
|
|
$ |
301,467 |
|
|
|
74.4 |
% |
NET WRITTEN
PREMIUMS |
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
Three months ended |
|
|
|
|
September 30, 2015 |
|
September 30, 2014 |
|
|
|
|
|
|
Percent of |
|
|
|
Percent of |
|
Change in |
|
|
Written |
|
net written |
|
Written |
|
net written |
|
net written |
|
($ in thousands) |
premiums |
|
premiums |
|
premiums |
|
premiums |
|
premiums |
|
Property and casualty insurance |
|
|
|
|
|
|
|
|
|
|
Commercial lines: |
|
|
|
|
|
|
|
|
|
|
Automobile |
$ |
28,904 |
|
|
|
17.4 |
% |
|
$ |
27,792 |
|
|
|
17.1 |
% |
|
|
4.0 |
% |
|
Property |
|
32,891 |
|
|
|
19.8 |
% |
|
|
31,735 |
|
|
|
19.5 |
% |
|
|
3.6 |
% |
|
Workers' compensation |
|
33,385 |
|
|
|
20.1 |
% |
|
|
32,236 |
|
|
|
19.8 |
% |
|
|
3.6 |
% |
|
Liability |
|
26,556 |
|
|
|
16.0 |
% |
|
|
25,072 |
|
|
|
15.4 |
% |
|
|
5.9 |
% |
|
Other |
|
2,213 |
|
|
|
1.3 |
% |
|
|
2,352 |
|
|
|
1.4 |
% |
|
|
(5.9 |
)% |
|
Total commercial lines |
|
123,949 |
|
|
|
74.6 |
% |
|
|
119,187 |
|
|
|
73.2 |
% |
|
|
4.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Personal lines: |
|
|
|
|
|
|
|
|
|
|
Automobile |
|
5,333 |
|
|
|
3.2 |
% |
|
|
5,962 |
|
|
|
3.7 |
% |
|
|
(10.5 |
)% |
|
Homeowners |
|
5,440 |
|
|
|
3.3 |
% |
|
|
5,856 |
|
|
|
3.6 |
% |
|
|
(7.1 |
)% |
|
Total personal lines |
|
10,773 |
|
|
|
6.5 |
% |
|
|
11,818 |
|
|
|
7.3 |
% |
|
|
(8.8 |
)% |
|
Total property and |
|
|
|
|
|
|
|
|
|
|
casualty insurance |
$ |
134,722 |
|
|
|
81.1 |
% |
|
$ |
131,005 |
|
|
|
80.5 |
% |
|
|
2.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Reinsurance |
|
|
|
|
|
|
|
|
|
|
Pro rata reinsurance: |
|
|
|
|
|
|
|
|
|
|
Multiline (primarily property) |
$ |
930 |
|
|
|
0.6 |
% |
|
$ |
1,228 |
|
|
|
0.8 |
% |
|
|
(24.3 |
)% |
|
Property |
|
4,678 |
|
|
|
2.8 |
% |
|
|
2,172 |
|
|
|
1.3 |
% |
|
|
115.4 |
% |
|
Liability |
|
5,925 |
|
|
|
3.6 |
% |
|
|
3,351 |
|
|
|
2.1 |
% |
|
|
76.8 |
% |
|
Marine |
|
570 |
|
|
|
0.3 |
% |
|
|
3,980 |
|
|
|
2.4 |
% |
|
|
(85.7 |
)% |
|
Total pro rata reinsurance |
|
12,103 |
|
|
|
7.3 |
% |
|
|
10,731 |
|
|
|
6.6 |
% |
|
|
12.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Excess of loss reinsurance: |
|
|
|
|
|
|
|
|
|
|
Property |
|
16,614 |
|
|
|
10.0 |
% |
|
|
17,929 |
|
|
|
11.0 |
% |
|
|
(7.3 |
)% |
|
Liability |
|
2,729 |
|
|
|
1.6 |
% |
|
|
3,164 |
|
|
|
1.9 |
% |
|
|
(13.7 |
)% |
|
Total excess of loss
reinsurance |
|
19,343 |
|
|
|
11.6 |
% |
|
|
21,093 |
|
|
|
12.9 |
% |
|
|
(8.3 |
)% |
|
Total reinsurance |
$ |
31,446 |
|
|
|
18.9 |
% |
|
$ |
31,824 |
|
|
|
19.5 |
% |
|
|
(1.2 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated |
$ |
166,168 |
|
|
|
100.0 |
% |
|
$ |
162,829 |
|
|
|
100.0 |
% |
|
|
2.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET WRITTEN
PREMIUMS |
|
|
|
|
|
|
|
|
|
|
|
Nine months ended |
|
Nine months ended |
|
|
|
|
September 30, 2015 |
|
September 30, 2014 |
|
|
|
|
|
|
Percent of |
|
|
|
Percent of |
|
Change in |
|
|
Written |
|
net written |
|
Written |
|
net written |
|
net written |
|
($ in thousands) |
premiums |
|
premiums |
|
premiums |
|
premiums |
|
premiums |
|
Property and casualty
insurance |
|
|
|
|
|
|
|
|
|
|
Commercial lines: |
|
|
|
|
|
|
|
|
|
|
Automobile |
$ |
86,947 |
|
|
|
18.9 |
% |
|
$ |
80,335 |
|
|
|
18.4 |
% |
|
|
8.2 |
% |
|
Property |
|
85,853 |
|
|
|
18.6 |
% |
|
|
80,992 |
|
|
|
18.5 |
% |
|
|
6.0 |
% |
|
Workers' compensation |
|
76,912 |
|
|
|
16.7 |
% |
|
|
73,703 |
|
|
|
16.9 |
% |
|
|
4.4 |
% |
|
Liability |
|
75,765 |
|
|
|
16.4 |
% |
|
|
70,366 |
|
|
|
16.1 |
% |
|
|
7.7 |
% |
|
Other |
|
6,413 |
|
|
|
1.4 |
% |
|
|
5,907 |
|
|
|
1.3 |
% |
|
|
8.6 |
% |
|
Total commercial lines |
|
331,890 |
|
|
|
72.0 |
% |
|
|
311,303 |
|
|
|
71.2 |
% |
|
|
6.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Personal lines: |
|
|
|
|
|
|
|
|
|
|
Automobile |
|
16,944 |
|
|
|
3.7 |
% |
|
|
18,583 |
|
|
|
4.2 |
% |
|
|
(8.8 |
)% |
|
Homeowners |
|
15,495 |
|
|
|
3.3 |
% |
|
|
16,096 |
|
|
|
3.7 |
% |
|
|
(3.7 |
)% |
|
Total personal lines |
|
32,439 |
|
|
|
7.0 |
% |
|
|
34,679 |
|
|
|
7.9 |
% |
|
|
(6.5 |
)% |
|
Total property and |
|
|
|
|
|
|
|
|
|
|
casualty insurance |
$ |
364,329 |
|
|
|
79.0 |
% |
|
$ |
345,982 |
|
|
|
79.1 |
% |
|
|
5.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Reinsurance |
|
|
|
|
|
|
|
|
|
|
Pro rata reinsurance: |
|
|
|
|
|
|
|
|
|
|
Multiline (primarily property) |
$ |
3,194 |
|
|
|
0.7 |
% |
|
$ |
5,210 |
|
|
|
1.2 |
% |
|
|
(38.7 |
)% |
|
Property |
|
11,361 |
|
|
|
2.4 |
% |
|
|
8,364 |
|
|
|
1.9 |
% |
|
|
35.8 |
% |
|
Liability |
|
19,271 |
|
|
|
4.2 |
% |
|
|
9,798 |
|
|
|
2.3 |
% |
|
|
96.7 |
% |
|
Marine |
|
6,406 |
|
|
|
1.4 |
% |
|
|
9,768 |
|
|
|
2.2 |
% |
|
|
(34.4 |
)% |
|
Total pro rata reinsurance |
|
40,232 |
|
|
|
8.7 |
% |
|
|
33,140 |
|
|
|
7.6 |
% |
|
|
21.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Excess of loss reinsurance: |
|
|
|
|
|
|
|
|
|
|
Property |
|
47,356 |
|
|
|
10.3 |
% |
|
|
49,342 |
|
|
|
11.3 |
% |
|
|
(4.0 |
)% |
|
Liability |
|
9,326 |
|
|
|
2.0 |
% |
|
|
8,794 |
|
|
|
2.0 |
% |
|
|
6.1 |
% |
|
Total excess of loss
reinsurance |
|
56,682 |
|
|
|
12.3 |
% |
|
|
58,136 |
|
|
|
13.3 |
% |
|
|
(2.5 |
)% |
|
Total reinsurance |
$ |
96,914 |
|
|
|
21.0 |
% |
|
$ |
91,276 |
|
|
|
20.9 |
% |
|
|
6.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated |
$ |
461,243 |
|
|
|
100.0 |
% |
|
$ |
437,258 |
|
|
|
100.0 |
% |
|
|
5.5 |
% |
|
Contact:
Steve Walsh (Investors)
515-345-2515
Lisa Hamilton (Media)
515-345-7589
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