8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities and Exchange Act of 1934

Date of Report (or Date of Earliest Event Reported): November 6, 2012

Homeowners Choice, Inc.

(Exact Name of Registrant as Specified in Its Charter)

Florida	001-34126	20-5961396
(State or Other Jurisdiction of Incorporation or Organization)	(Commission File Number)	(I.R.S. Employer Identification Number)

5300 West Cypress Street, Suite 100

Tampa, Florida 33607

(Address of Principal Executive Offices)

(813) 405-3600

(Telephone Number, Including Area Code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Section 2– Financial Information

Item 2.02 Results of Operations and Financial Condition

On November 6, 2012, we released our earnings for the three months and nine months ended September 30, 2012. We plan to host an earnings conference call that same day at 4:30 p.m. ET during which our chief executive officer and chief financial officer will discuss the results.

The conference call will be broadcast live on the following website at http://www.ir-site.com/hcpci/events.asp and will be available for replay until Feb. 6, 2013.

Those who wish to participate on the conference call should contact Jay Madhu, Homeowners Choice vice president of investor relations, at 813-405-3660 or jmadhu@hcpci.com.

For those who wish to listen to the call via telephone, please dial the listen-only telephone number below at least 5-10 minutes prior to the scheduled start time:

Toll-Free Number:              877-407-8992

International Number:         201-689-8033

Our earnings release appears as Exhibit 99.1.

Section 9 – Financial Statements and Exhibits

Item 9.01 Exhibits.

Exhibit 99.1 Earnings Release

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Dated: November 6, 2012.

HOMEOWNERS CHOICE, INC.
BY:	/s/ Richard R. Allen
Name:	Richard R. Allen
Title:	Chief Financial Officer

A signed original of this Form 8-K has been provided to Homeowners Choice, Inc. and will be retained by Homeowners Choice, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE

CONTACTS:
Media Contact:	Investor Relations Contact:
Suzie Boland	Jay Madhu
RFB Communications Group	Homeowners Choice, Inc.
813.259.0345	813.405.3660
sboland@rfbcommunications.com	jmadhu@hcpci.com

Homeowners Choice Reports 2012 Third Quarter and

Nine-Month Financial Results

Tampa, Fla. – Nov. 6, 2012 – Homeowners Choice, Inc. (NYSE: HCI), a leading provider of homeowners’ insurance, today announced financial results for the three and nine months ended Sept. 30, 2012.

Third Quarter 2012 - Financial Results

Income available to common stockholders in the third quarter of 2012 totaled $2.8 million or $0.27 diluted earnings per common share, compared to $1.9 million or $0.27 diluted earnings per common share in the third quarter of 2011.

Gross premiums earned in the third quarter of 2012 increased 67.3% to $53.1 million from $31.7 million in the same year-ago period. The increase was primarily due to policies acquired from HomeWise Insurance Company.

Net premiums earned (defined as gross premiums earned less premiums ceded to reinsurance companies) in the third quarter of 2012 increased 65% to $30.6 million from $18.5 million in the same period in 2011. Reinsurance costs in the third quarter of 2012 were 42.4% of the company’s gross premiums earned, compared with 41.6% during the same period in 2011.

Losses and loss adjustment expenses during the third quarter of 2012 were $15.0 million compared with $10.4 million in the same year-ago period. Losses and loss adjustment expenses in the third quarter of 2012 included approximately $3.2 million related to case reported claims from Tropical Storm Debby and Tropical Storm Isaac, which occurred in late June and Aug. 2012, respectively.

Policy acquisition and other underwriting expenses in the third quarter of 2012 were $6.6 million compared with $3.5 million in the comparable period in 2011. The increase was primarily due to commissions and premium taxes related to the increase in policy renewals in 2012. Other operating expenses, which include a variety of general and administrative costs, totaled $4.7 million in the third quarter of 2012 compared with $2.4 million in third quarter 2011.

Third Quarter 2012 - Financial Ratios

The company’s loss ratio applicable to the third quarter of 2012 (defined as loss and loss adjustment expenses related to net premiums earned) was 49.1% compared with 56.3% in the third quarter of 2011.

The expense ratio applicable to the third quarter of 2012 (defined as policy acquisition and other underwriting expenses related to net premiums earned plus compensation, employee benefits and other operating expenses) was 37.1% compared with 32.3% in the same period in 2011.

Expressed as the total of all expenses related to net premiums earned, the 2012 combined loss and expense ratio to net premiums earned was 86.1% compared with 88.5% in the same period in 2011.

Nine Months Ended Sept. 30, 2012 - Financial Results

Income available to common stockholders for the nine months ended Sept. 30, 2012 totaled $16.8 million or $1.79 diluted earnings per common share, compared with $4.6 million or $0.70 diluted earnings per common share for the nine months ended Sept. 30, 2011.

Gross premiums earned for the nine months ended Sept. 30, 2012 increased 72.2% to $161.6 million from $93.9 million in the same period in 2011.

Net premiums earned for the nine months ended Sept. 30, 2012 increased 107.0% to $108.1 million from $52.2 million in the same period in 2011. Reinsurance costs for the nine months ended 2012 were 33.1% of the company’s gross premiums earned, compared with 44.3% during the same period in 2011. The decrease was due to lower costs during the first five months of 2012 related to policies assumed from HomeWise, which were subject to minimal reinsurance premiums because they were acquired late in Florida’s hurricane season.

Losses and loss adjustment expenses for the nine months ended Sept. 30, 2012 and 2011 were $50.4 million and $31.4 million, respectively. The company’s losses for the nine months ended Sept. 30, 2012 included approximately $5.3 million related to claims from Tropical Storm Debby and Tropical Storm Isaac.

Policy acquisition and other underwriting expenses for the nine months ended Sept. 30, 2012 were $19.7 million compared with $10.6 million for the nine months ended Sept. 30, 2011. Other operating expenses totaled $13.4 million in the nine months ended Sept. 30, 2012 compared with $6.9 million in the nine months ended Sept. 30, 2011.

Nine Months Ended Sept. 30, 2012 - Financial Ratios

The company’s loss ratio applicable to the nine months ended Sept. 30, 2012 was 46.6% compared with 60.0% in the nine months ended Sept. 30, 2011.

The expense ratio applicable to the nine months ended Sept. 30, 2012 was 30.6% compared with 33.5% in the same period in 2011.

Expressed as the total of all expenses related to net premiums earned, the 2012 combined loss and expense ratio to net premiums earned was 77.2% compared with 93.5% in the same period in 2011.

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Management Commentary

“We are pleased to report strong quarterly and nine-month results despite the impact of tropical storms that occurred in June and August 2012,” said Paresh Patel, Homeowners Choice chairman and chief executive officer. “We believe we have strong momentum to carry us forward into 2013 and we look forward to continuing profitable growth.”

Conference Call

Homeowners Choice will hold a conference call later today (Nov. 6, 2012) to discuss these financial results. The company’s chairman and chief executive officer Paresh Patel and chief financial officer Richard Allen will host the call starting at 4:30 p.m. Eastern Time. A question and answer session will follow management’s presentation.

The conference call will be broadcast live on the following website at http://www.ir-site.com/hcpci/events.asp and will be available for replay until Feb. 6, 2013.

Those who wish to participate on the conference call should contact Jay Madhu, Homeowners Choice vice president of investor relations, at 813-405-3660 or jmadhu@hcpci.com.

For those who wish to listen to the call via telephone, please dial the listen-only telephone number below at least 5-10 minutes prior to the scheduled start time:

Toll-Free Number:         877-407-8992

International Number:    201-689-8033

About Homeowners Choice, Inc.

Homeowners Choice, Inc. is a Florida-based insurance holding company headquartered in Tampa. Through its subsidiary corporations, Homeowners Choice provides property and casualty homeowners’ insurance, condominium owners’ insurance and tenants’ insurance. The company’s common shares trade on the New York Stock Exchange under the ticker symbol “HCI“ and are included in the Russell 2000 Index. Its Series A, cumulative redeemable preferred shares trade on the NASDAQ Capital Market under the ticker symbol “HCIIP.” More information about Homeowners Choice is available at www.hcpci.com.

Forward-Looking Statements

This news release may contain forward-looking statements made pursuant to the Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “estimate,” “expect,” “intend,” “plan” and “project” and other similar words and expressions are intended to signify forward-looking statements. Forward-looking statements are not guarantees of future results and conditions but rather are subject to various risks and uncertainties. For example there can be no assurance the Company will have continuing profitable growth. Some of these risks and uncertainties are identified in the company’s filings with the Securities and Exchange Commission. Should any risks or uncertainties develop into actual events, these developments could have material adverse effects on the company’s business, financial condition and results of operations. Homeowners Choice, Inc. disclaims all obligations to update any forward-looking statements.

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HOMEOWNERS CHOICE, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Dollars in thousands, except share amounts)

	September 30, 2012		December 31, 2011
	(Unaudited)
Assets
Fixed-maturity securities, available-for-sale, at fair value (amortized cost $38,624 and $34,147)	$	41,397		34,642
Equity securities, available-for-sale, at fair value		9,522		5,207
Time deposits		7,267		12,427
Other investments		15,696		6,483
Total investments		73,882		58,759
Cash and cash equivalents		141,922		100,355
Accrued interest and dividends receivable		334		408
Premiums receivable		17,499		12,222
Assumed reinsurance balances receivable		—		1,687
Prepaid reinsurance premiums		21,781		14,169
Deferred policy acquisition costs		12,548		12,321
Property and equipment, net		10,840		10,499
Goodwill		161		161
Income taxes receivable		1,495		—
Deferred income taxes		—		2,368
Other assets		1,849		1,869
Total assets	$	282,311		214,818
Liabilities and Stockholders’ Equity
Losses and loss adjustment expenses		38,726		27,424
Unearned premiums		120,845		108,677
Advance premiums		6,702		2,132
Assumed reinsurance balances payable		1,329		—
Accrued expenses		5,053		3,478
Deferred income taxes		977		—
Dividends payable		98		218
Income taxes payable		—		4,956
Other liabilities		7,494		4,103
Total liabilities		181,224		150,988
Stockholders’ equity:
7% Series A cumulative convertible preferred stock (liquidation preference $10.00 per share), no par value, 1,500,000 shares authorized, 331,525 and 1,247,700 shares issued and outstanding in 2012 and 2011, respectively		—		—
Preferred stock (no par value, 18,500,000 shares authorized, no shares issued or outstanding)		—		—
Common stock, (no par value, 40,000,000 shares authorized, 9,601,019 and 6,202,485 shares issued and outstanding in 2012 and 2011, respectively)		—		—
Additional paid-in capital		53,209		29,636
Retained earnings		46,045		33,986
Accumulated other comprehensive income		1,833		208
Total stockholders’ equity		101,087		63,830
Total liabilities and stockholders’ equity	$	282,311		214,818

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HOMEOWNERS CHOICE, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Income

(Unaudited)

(Dollars in thousands, except per share amounts)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2012			2011			2012			2011
Revenue
Gross premiums earned	$	53,109			31,741		$	161,579			93,855
Premiums ceded		(22,506	)		(13,211	)		(53,475	)		(41,607	)
Net premiums earned		30,603			18,530			108,104			52,248
Net investment income		47			486			871			1,557
Policy fee income		624			424			2,167			1,278
Realized investment (losses) gains		(4	)		123			26			416
Gain on bargain purchase		—			—			179			936
Other		211			150			641			808
Total revenue		31,481			19,713			111,988			57,243
Expenses
Losses and loss adjustment expenses		15,017			10,431			50,382			31,357
Policy acquisition and other underwriting expenses		6,611			3,529			19,690			10,572
Other operating expenses		4,728			2,447			13,401			6,932
Total expenses		26,356			16,407			83,473			48,861
Income before income taxes		5,125			3,306			28,515			8,382
Income taxes		2,299			1,232			11,459			3,214
Net income	$	2,826			2,074		$	17,056			5,168
Preferred stock dividends		(42	)		(218	)		(286	)		(596	)
Income available to common stockholders	$	2,784			1,856		$	16,770			4,572
Basic earnings per common share	$	0.30			0.30		$	2.08			0.75
Diluted earnings per common share	$	0.27			0.27		$	1.79			0.70
Dividends per common share	$	0.20			0.10		$	0.55			0.30

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