Delaware | 0-15886 | 13-3138397 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
6 International Drive, Rye Brook, New York |
10573 |
|
(Address of principal executive offices) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
99.1 | Second Quarter Earnings Press Release dated August 4, 2011. |
2
THE NAVIGATORS GROUP, INC. |
||||
By: | /s/ Bruce J. Byrnes | |||
Name: | Bruce J. Byrnes | |||
Title: | Senior Vice President and General Counsel |
3
Exhibit No. | Exhibit | |||
99.1 | Second Quarter Earnings Press Release dated August 4, 2011. |
4
6 International Drive | Rye Brook, NY 10573 | |||
TEL (914) 933-6000 | FAX (914) 934-2355 |
(1) | Operating earnings, or net income excluding after-tax net realized gains (losses) and net
other-than-temporary impairment losses recognized in earnings, is a non-GAAP financial measure
that is a common performance measurement for insurance companies. We believe this
presentation enhances the understanding of our results of operations by highlighting the
underlying profitability of our insurance business. |
Contact:
|
Francis W. McDonnell | |
Senior Vice President and Chief Financial Officer | ||
(914) 933-6270 | ||
fmcdonnell@navg.com | ||
www.navg.com |
Three Months Ended | Six Months Ended | |||||||||||||||||||||||
June 30, | June 30, | |||||||||||||||||||||||
Results of Operations | 2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||||||||
Gross written premiums |
$ | 278,714 | $ | 253,568 | 9.9 | % | $ | 574,997 | $ | 523,713 | 9.8 | % | ||||||||||||
Net written premiums |
183,363 | 165,005 | 11.1 | % | 376,439 | 354,322 | 6.2 | % | ||||||||||||||||
Revenues: |
||||||||||||||||||||||||
Net earned premiums |
173,777 | 161,471 | 7.6 | % | 326,255 | 325,540 | 0.2 | % | ||||||||||||||||
Commission income |
||||||||||||||||||||||||
Net investment income |
17,429 | 17,853 | -2.4 | % | 34,813 | 35,825 | -2.8 | % | ||||||||||||||||
Total other-than-temporary impairment losses |
(833 | ) | (489 | ) | NM | (1,096 | ) | (740 | ) | NM | ||||||||||||||
Portion of loss recognized in other comprehensive
income (before tax) |
301 | 334 | -9.9 | % | 322 | 504 | -36.1 | % | ||||||||||||||||
Net other-than-temporary impairment losses
recognized in earnings |
(532 | ) | (155 | ) | NM | (774 | ) | (236 | ) | NM | ||||||||||||||
Net realized gains (losses) |
3,006 | 11,020 | -72.7 | % | 1,618 | 17,133 | -90.6 | % | ||||||||||||||||
Other income |
573 | (899 | ) | NM | 1,564 | 171 | NM | |||||||||||||||||
Total revenues |
194,253 | 189,290 | 2.6 | % | 363,476 | 378,433 | -4.0 | % | ||||||||||||||||
Expenses: |
||||||||||||||||||||||||
Net losses and loss adjustment expenses |
113,863 | 99,863 | 14.0 | % | 230,651 | 203,670 | 13.2 | % | ||||||||||||||||
Commission expenses |
28,030 | 25,677 | 9.2 | % | 54,230 | 50,993 | 6.3 | % | ||||||||||||||||
Other operating expenses |
35,777 | 34,513 | 3.7 | % | 72,352 | 69,099 | 4.7 | % | ||||||||||||||||
Interest expense |
2,047 | 2,044 | 0.1 | % | 4,093 | 4,088 | 0.1 | % | ||||||||||||||||
Total expenses |
179,717 | 162,097 | 10.9 | % | 361,326 | 327,850 | 10.2 | % | ||||||||||||||||
Income before income taxes |
14,536 | 27,193 | -46.5 | % | 2,150 | 50,583 | -95.7 | % | ||||||||||||||||
Income tax expense (benefit) |
5,032 | 8,223 | -38.8 | % | 539 | 14,568 | -96.3 | % | ||||||||||||||||
Net income (loss) |
$ | 9,504 | $ | 18,970 | -49.9 | % | $ | 1,611 | $ | 36,015 | -95.5 | % | ||||||||||||
Per Share Data |
||||||||||||||||||||||||
Net income per common share: |
||||||||||||||||||||||||
Basic |
$ | 0.62 | $ | 1.18 | -47.5 | % | $ | 0.10 | $ | 2.20 | -95.3 | % | ||||||||||||
Diluted |
$ | 0.60 | $ | 1.16 | -47.7 | % | $ | 0.10 | $ | 2.16 | -95.3 | % | ||||||||||||
Average common shares outstanding: |
||||||||||||||||||||||||
Basic |
15,373 | 16,100 | 15,555 | 16,369 | ||||||||||||||||||||
Diluted |
15,726 | 16,422 | 15,944 | 16,686 | ||||||||||||||||||||
Underwriting Ratios |
||||||||||||||||||||||||
Loss Ratio |
65.5 | % | 61.8 | % | 70.7 | % | 62.6 | % | ||||||||||||||||
Expense Ratio |
36.4 | % | 37.9 | % | 38.3 | % | 36.8 | % | ||||||||||||||||
Combined Ratio |
101.9 | % | 99.7 | % | 109.0 | % | 99.4 | % |
June 30, | Mar. 31, | June 30, | Dec. 31, | |||||||||||||||||||||
Balance Sheet Data | 2011 | 2011 | 2011 | 2010 | ||||||||||||||||||||
Stockholders equity |
$ | 817,919 | $ | 815,172 | 0.3 | % | $ | 817,919 | $ | 829,354 | -1.4 | % | ||||||||||||
Book value per share |
$ | 54.44 | $ | 52.29 | 4.1 | % | $ | 54.44 | $ | 52.68 | 3.3 | % |
June 30, | December 31, | |||||||
2011 | 2010 | |||||||
(unaudited) | ||||||||
ASSETS |
||||||||
Investments and cash: |
||||||||
Fixed maturities, available-for-sale, at fair value
(amortized cost: 2011, $1,799,369; 2010, $1,855,598) |
$ | 1,847,221 | $ | 1,882,245 | ||||
Equity securities, available-for-sale, at fair value (cost: 2011, $68,035; 2010, $64,793) |
94,737 | 87,258 | ||||||
Short-term investments, at cost which approximates fair value |
185,032 | 153,057 | ||||||
Cash |
40,340 | 31,768 | ||||||
Total investments and cash |
2,167,330 | 2,154,328 | ||||||
Premiums receivable |
273,327 | 188,368 | ||||||
Prepaid reinsurance premiums |
176,960 | 156,869 | ||||||
Reinsurance recoverable on paid losses |
65,856 | 56,658 | ||||||
Reinsurance recoverable on unpaid losses and loss adjustment expenses |
852,992 | 843,296 | ||||||
Deferred policy acquisition costs |
60,468 | 55,201 | ||||||
Accrued investment income |
14,212 | 15,590 | ||||||
Goodwill and other intangible assets |
7,037 | 6,925 | ||||||
Current income tax receivable, net |
6,877 | 1,054 | ||||||
Deferred income tax, net |
6,871 | 15,141 | ||||||
Other assets |
23,979 | 38,029 | ||||||
Total assets |
$ | 3,655,909 | $ | 3,531,459 | ||||
LIABILITIES AND STOCKHOLDERS EQUITY |
||||||||
Liabilities: |
||||||||
Reserves for losses and loss adjustment expenses |
$ | 2,033,556 | $ | 1,985,838 | ||||
Unearned premiums |
534,474 | 463,515 | ||||||
Reinsurance balances payable |
125,482 | 105,904 | ||||||
Senior notes |
115,547 | 114,138 | ||||||
Accounts payable and other liabilities |
28,931 | 32,710 | ||||||
Total liabilities |
2,837,990 | 2,702,105 | ||||||
Stockholders equity: |
||||||||
Preferred stock, $.10 par value, authorized 1,000,000 shares, none issued |
| | ||||||
Common stock, $.10 par value, authorized 50,000,000 shares, issued 17,400,857 shares
for 2011 and 17,274,440 shares for 2010 |
1,744 | 1,728 | ||||||
Additional paid-in capital |
323,174 | 312,588 | ||||||
Treasury stock, at cost (2,385,393 shares for 2011 and 1,532,273 shares for 2010) |
(106,377 | ) | (64,935 | ) | ||||
Retained earnings |
541,123 | 539,512 | ||||||
Accumulated other comprehensive income |
58,255 | 40,461 | ||||||
Total stockholders equity |
817,919 | 829,354 | ||||||
Total liabilities and stockholders equity |
$ | 3,655,909 | $ | 3,531,459 | ||||
Gross Written Premiums: | Three Months | Six Months | ||||||||||||||||||||||
Insurance Companies: | 2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||||||||
Marine |
$ | 58,323 | $ | 55,204 | 6 | % | $ | 128,671 | $ | 122,730 | 5 | % | ||||||||||||
Property Casualty |
100,131 | 81,797 | 22 | % | 213,019 | 161,143 | 32 | % | ||||||||||||||||
Professional Liability |
28,313 | 33,640 | -16 | % | 51,853 | 64,606 | -20 | % | ||||||||||||||||
186,767 | 170,641 | 9 | % | 393,543 | 348,479 | 13 | % | |||||||||||||||||
Lloyds Operations: |
||||||||||||||||||||||||
Marine |
39,451 | 41,829 | -6 | % | 100,606 | 100,970 | 0 | % | ||||||||||||||||
Property Casualty |
42,122 | 29,122 | 45 | % | 61,424 | 49,081 | 25 | % | ||||||||||||||||
Professional Liability |
10,374 | 11,976 | -13 | % | 19,424 | 25,183 | -23 | % | ||||||||||||||||
91,947 | 82,927 | 11 | % | 181,454 | 175,234 | 4 | % | |||||||||||||||||
Total |
$ | 278,714 | $ | 253,568 | 10 | % | $ | 574,997 | $ | 523,713 | 10 | % | ||||||||||||
Net Written Premiums: | Three Months | Six Months | ||||||||||||||||||||||
Insurance Companies: | 2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||||||||
Marine |
$ | 41,802 | $ | 37,153 | 13 | % | $ | 96,020 | $ | 88,156 | 9 | % | ||||||||||||
Property Casualty |
62,015 | 54,300 | 14 | % | 124,922 | 103,997 | 20 | % | ||||||||||||||||
Professional Liability |
19,387 | 19,948 | -3 | % | 33,002 | 40,588 | -19 | % | ||||||||||||||||
123,204 | 111,401 | 11 | % | 253,944 | 232,741 | 9 | % | |||||||||||||||||
Lloyds Operations: |
||||||||||||||||||||||||
Marine |
32,042 | 34,421 | -7 | % | 81,713 | 84,063 | -3 | % | ||||||||||||||||
Property Casualty |
22,682 | 13,924 | 63 | % | 31,068 | 25,635 | 21 | % | ||||||||||||||||
Professional Liability |
5,435 | 5,259 | 3 | % | 9,714 | 11,883 | -18 | % | ||||||||||||||||
60,159 | 53,604 | 12 | % | 122,495 | 121,581 | 1 | % | |||||||||||||||||
Total |
$ | 183,363 | $ | 165,005 | 11 | % | $ | 376,439 | $ | 354,322 | 6 | % | ||||||||||||
Net Earned Premiums: | Three Months | Six Months | ||||||||||||||||||||||
Insurance Companies: | 2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||||||||
Marine |
$ | 41,877 | $ | 40,554 | 3 | % | $ | 82,436 | $ | 81,648 | 1 | % | ||||||||||||
Property Casualty |
55,351 | 50,171 | 10 | % | 98,286 | 101,252 | -3 | % | ||||||||||||||||
Professional Liability |
17,759 | 19,700 | -10 | % | 33,085 | 38,736 | -15 | % | ||||||||||||||||
114,987 | 110,425 | 4 | % | 213,807 | 221,636 | -4 | % | |||||||||||||||||
Lloyds Operations: |
||||||||||||||||||||||||
Marine |
37,734 | 34,727 | 9 | % | 74,712 | 70,287 | 6 | % | ||||||||||||||||
Property Casualty |
16,259 | 10,763 | 51 | % | 28,153 | 22,678 | 24 | % | ||||||||||||||||
Professional Liability |
4,797 | 5,556 | -14 | % | 9,583 | 10,939 | -12 | % | ||||||||||||||||
58,790 | 51,046 | 15 | % | 112,448 | 103,904 | 8 | % | |||||||||||||||||
Total |
$ | 173,777 | $ | 161,471 | 8 | % | $ | 326,255 | $ | 325,540 | 0 | % | ||||||||||||
Insurance | Lloyds | |||||||||||||||
Companies | Operations | Corporate(1) | Total | |||||||||||||
Gross written premiums |
$ | 186,767 | $ | 91,947 | $ | | $ | 278,714 | ||||||||
Net written premiums |
123,204 | 60,159 | | 183,363 | ||||||||||||
Net earned premiums |
114,987 | 58,790 | | 173,777 | ||||||||||||
Net losses and loss adjustment expenses |
(77,330 | ) | (36,533 | ) | | (113,863 | ) | |||||||||
Commission expenses |
(16,402 | ) | (12,042 | ) | 414 | (28,030 | ) | |||||||||
Other operating expenses |
(26,516 | ) | (9,261 | ) | | (35,777 | ) | |||||||||
Other income (expense) |
626 | 361 | (414 | ) | 573 | |||||||||||
Underwriting profit (loss) |
(4,635 | ) | 1,315 | (0 | ) | (3,320 | ) | |||||||||
Net investment income |
14,989 | 2,320 | 120 | 17,429 | ||||||||||||
Net realized gains (losses) |
3,100 | (798 | ) | 172 | 2,474 | |||||||||||
Interest expense |
| | (2,047 | ) | (2,047 | ) | ||||||||||
Income (loss) before income taxes |
13,454 | 2,837 | (1,755 | ) | 14,536 | |||||||||||
Income tax expense (benefit) |
4,617 | 1,029 | (614 | ) | 5,032 | |||||||||||
Net income (loss) |
$ | 8,837 | $ | 1,808 | $ | (1,141 | ) | $ | 9,504 | |||||||
Losses and loss adjustment expenses ratio |
67.3 | % | 62.1 | % | 65.5 | % | ||||||||||
Commission expense ratio |
14.3 | % | 20.5 | % | 16.1 | % | ||||||||||
Other operating expense ratio (2) |
22.4 | % | 15.2 | % | 20.3 | % | ||||||||||
Combined ratio |
104.0 | % | 97.8 | % | 101.9 | % | ||||||||||
(1) | The Corporate segment includes intercompany eliminations. |
|
(2) | The Other operating expense ratio includes Other income (expense). |
Insurance | Lloyds | |||||||||||||||
Companies | Operations | Corporate(1) | Total | |||||||||||||
Gross written premiums |
$ | 170,641 | $ | 82,927 | $ | | $ | 253,568 | ||||||||
Net written premiums |
111,401 | 53,604 | | 165,005 | ||||||||||||
Net earned premiums |
110,425 | 51,046 | | 161,471 | ||||||||||||
Net losses and loss adjustment expenses |
(64,862 | ) | (35,001 | ) | | (99,863 | ) | |||||||||
Commission expenses |
(14,615 | ) | (11,402 | ) | 340 | (25,677 | ) | |||||||||
Other operating expenses |
(25,907 | ) | (8,617 | ) | | (34,524 | ) | |||||||||
Other income (expense) |
(114 | ) | (434 | ) | (340 | ) | (888 | ) | ||||||||
Underwriting profit (loss) |
4,927 | (4,408 | ) | | 519 | |||||||||||
Net investment income |
15,556 | 2,128 | 169 | 17,853 | ||||||||||||
Net realized gains (losses) |
10,729 | 19 | 117 | 10,865 | ||||||||||||
Interest expense |
| | (2,044 | ) | (2,044 | ) | ||||||||||
Income (loss) before income taxes |
31,212 | (2,261 | ) | (1,758 | ) | 27,193 | ||||||||||
Income tax expense (benefit) |
9,654 | (815 | ) | (616 | ) | 8,223 | ||||||||||
Net income (loss) |
$ | 21,558 | $ | (1,446 | ) | $ | (1,142 | ) | $ | 18,970 | ||||||
Losses and loss adjustment expenses ratio |
58.7 | % | 68.6 | % | 61.8 | % | ||||||||||
Commission expense ratio |
13.2 | % | 22.3 | % | 15.9 | % | ||||||||||
Other operating expense ratio (2) |
23.6 | % | 17.7 | % | 22.0 | % | ||||||||||
Combined ratio |
95.5 | % | 108.6 | % | 99.7 | % | ||||||||||
(1) | The Corporate segment includes intercompany eliminations. |
|
(2) | The Other operating expense ratio includes Other income (expense). |
Insurance | Lloyds | |||||||||||||||
Companies | Operations | Corporate(1) | Total | |||||||||||||
Gross written premiums |
$ | 393,543 | $ | 181,454 | $ | | $ | 574,997 | ||||||||
Net written premiums |
253,944 | 122,495 | | 376,439 | ||||||||||||
Net earned premiums |
213,807 | 112,448 | | 326,255 | ||||||||||||
Net losses and loss adjustment expenses |
(152,127 | ) | (78,524 | ) | | (230,651 | ) | |||||||||
Commission expenses |
(28,742 | ) | (26,449 | ) | 961 | (54,230 | ) | |||||||||
Other operating expenses |
(53,315 | ) | (19,037 | ) | | (72,352 | ) | |||||||||
Other income (expense) |
2,317 | 208 | (961 | ) | 1,564 | |||||||||||
Underwriting profit (loss) |
(18,060 | ) | (11,354 | ) | (0 | ) | (29,414 | ) | ||||||||
Net investment income |
29,972 | 4,575 | 266 | 34,813 | ||||||||||||
Net realized gains (losses) |
2,855 | (2,183 | ) | 172 | 844 | |||||||||||
Interest expense |
| | (4,093 | ) | (4,093 | ) | ||||||||||
Income (loss) before income taxes |
14,767 | (8,962 | ) | (3,655 | ) | 2,150 | ||||||||||
Income tax expense (benefit) |
4,845 | (3,027 | ) | (1,279 | ) | 539 | ||||||||||
Net income (loss) |
$ | 9,922 | $ | (5,935 | ) | $ | (2,376 | ) | $ | 1,611 | ||||||
Losses and loss adjustment expenses ratio |
71.2 | % | 69.8 | % | 70.7 | % | ||||||||||
Commission expense ratio |
13.4 | % | 23.5 | % | 16.6 | % | ||||||||||
Other operating expense ratio (2) |
23.8 | % | 16.8 | % | 21.7 | % | ||||||||||
Combined ratio |
108.4 | % | 110.1 | % | 109.0 | % | ||||||||||
(1) | The Corporate segment includes intercompany eliminations. |
|
(2) | The Other operating expense ratio includes Other income (expense). |
Insurance | Lloyds | |||||||||||||||
Companies | Operations | Corporate(1) | Total | |||||||||||||
Gross written premiums |
$ | 348,479 | $ | 175,234 | $ | | $ | 523,713 | ||||||||
Net written premiums |
232,741 | 121,581 | | 354,322 | ||||||||||||
Net earned premiums |
221,636 | 103,904 | | 325,540 | ||||||||||||
Net losses and loss adjustment expenses |
(133,265 | ) | (70,405 | ) | | (203,670 | ) | |||||||||
Commission expenses |
(28,977 | ) | (22,368 | ) | 352 | (50,993 | ) | |||||||||
Other operating expenses |
(53,260 | ) | (15,860 | ) | | (69,120 | ) | |||||||||
Other income (expense) |
(1,091 | ) | 1,635 | (352 | ) | 192 | ||||||||||
Underwriting profit (loss) |
5,043 | (3,094 | ) | | 1,949 | |||||||||||
Net investment income |
31,304 | 4,197 | 324 | 35,825 | ||||||||||||
Net realized gains (losses) |
15,934 | 732 | 231 | 16,897 | ||||||||||||
Interest expense |
| | (4,088 | ) | (4,088 | ) | ||||||||||
Income (loss) before income taxes |
52,281 | 1,835 | (3,533 | ) | 50,583 | |||||||||||
Income tax expense (benefit) |
15,117 | 688 | (1,237 | ) | 14,568 | |||||||||||
Net income (loss) |
$ | 37,164 | $ | 1,147 | $ | (2,296 | ) | $ | 36,015 | |||||||
Losses and loss adjustment expenses ratio |
60.1 | % | 67.8 | % | 62.6 | % | ||||||||||
Commission expense ratio |
13.1 | % | 21.5 | % | 15.7 | % | ||||||||||
Other operating expense ratio (2) |
24.5 | % | 13.7 | % | 21.1 | % | ||||||||||
Combined ratio |
97.7 | % | 103.0 | % | 99.4 | % | ||||||||||
(1) | The Corporate segment includes intercompany eliminations. |
|
(2) | The Other operating expense ratio includes Other income (expense). |
Three Months Ended June 30, 2011 | ||||||||||||||||||||||||||||
Net | Losses | |||||||||||||||||||||||||||
Earned | and LAE | Underwriting | Underwriting | Loss | Expense | Combined | ||||||||||||||||||||||
Insurance Companies: | Premiums | Incurred | Expenses | Profit (Loss) | Ratio | Ratio | Ratio | |||||||||||||||||||||
Marine |
$ | 41,877 | $ | 26,808 | $ | 15,082 | $ | (13 | ) | 64.0 | % | 36.0 | % | 100.0 | % | |||||||||||||
Property Casualty |
55,351 | 38,429 | 20,458 | (3,536 | ) | 69.4 | % | 37.0 | % | 106.4 | % | |||||||||||||||||
Professional Liability |
17,759 | 12,093 | 6,752 | (1,086 | ) | 68.1 | % | 38.0 | % | 106.1 | % | |||||||||||||||||
114,987 | 77,330 | 42,292 | (4,635 | ) | 67.3 | % | 36.7 | % | 104.0 | % | ||||||||||||||||||
Lloyds Operations |
58,790 | 36,533 | 20,942 | 1,315 | 62.1 | % | 35.7 | % | 97.8 | % | ||||||||||||||||||
Total |
$ | 173,777 | $ | 113,863 | $ | 63,234 | $ | (3,320 | ) | 65.5 | % | 36.4 | % | 101.9 | % | |||||||||||||
Three Months Ended June 30, 2010 | ||||||||||||||||||||||||||||
Net | Losses | |||||||||||||||||||||||||||
Earned | and LAE | Underwriting | Underwriting | Loss | Expense | Combined | ||||||||||||||||||||||
Insurance Companies: | Premiums | Incurred | Expenses | Profit (Loss) | Ratio | Ratio | Ratio | |||||||||||||||||||||
Marine |
$ | 40,554 | $ | 25,521 | $ | 14,171 | $ | 862 | 62.9 | % | 35.0 | % | 97.9 | % | ||||||||||||||
Property Casualty |
50,171 | 24,936 | 19,192 | 6,043 | 49.7 | % | 38.3 | % | 88.0 | % | ||||||||||||||||||
Professional Liability |
19,700 | 14,405 | 7,273 | (1,978 | ) | 73.1 | % | 36.9 | % | 110.0 | % | |||||||||||||||||
110,425 | 64,862 | 40,636 | 4,927 | 58.7 | % | 36.8 | % | 95.5 | % | |||||||||||||||||||
Lloyds Operations |
51,046 | 35,001 | 20,453 | (4,408 | ) | 68.6 | % | 40.0 | % | 108.6 | % | |||||||||||||||||
Total |
$ | 161,471 | $ | 99,863 | $ | 61,089 | $ | 519 | 61.8 | % | 37.9 | % | 99.7 | % | ||||||||||||||
Amounts | Loss Ratio | |||||||||||||||
Net Incurred Loss Activity | June 30, | June 30, | June 30, | June 30, | ||||||||||||
For the Three Months Ended: | 2011 | 2010 | 2011 | 2010 | ||||||||||||
Insurance Companies: |
||||||||||||||||
Loss and LAE payments |
$ | 77,278 | $ | 68,098 | 67.3 | % | 61.7 | % | ||||||||
Change in reserves |
52 | (3,236 | ) | 0.0 | % | -3.0 | % | |||||||||
Net incurred loss and LAE |
77,330 | 64,862 | 67.3 | % | 58.7 | % | ||||||||||
Lloyds Operations: |
||||||||||||||||
Loss and LAE payments |
26,646 | 30,637 | 45.3 | % | 60.0 | % | ||||||||||
Change in reserves |
9,887 | 4,364 | 16.8 | % | 8.6 | % | ||||||||||
Net incurred loss and LAE |
36,533 | 35,001 | 62.1 | % | 68.6 | % | ||||||||||
Total |
||||||||||||||||
Loss and LAE payments |
103,924 | 98,735 | 59.8 | % | 61.1 | % | ||||||||||
Change in reserves |
9,939 | 1,128 | 5.7 | % | 0.7 | % | ||||||||||
Net incurred loss and LAE |
$ | 113,863 | $ | 99,863 | 65.5 | % | 61.8 | % | ||||||||
Impact of Prior Years Reserves | Amounts | Loss Ratio Impact | ||||||||||||||
Favorable / (Unfavorable) Development | June 30, | June 30, | June 30, | June 30, | ||||||||||||
For the Three Months Ended: | 2011 | 2010 | 2011 | 2010 | ||||||||||||
Insurance Companies |
$ | 137 | $ | 4,844 | 0.1 | % | 4.4 | % | ||||||||
Lloyds Operations |
(952 | ) | 406 | -1.6 | % | 0.8 | % | |||||||||
Total |
$ | (815 | ) | $ | 5,250 | -0.5 | % | 3.3 | % | |||||||
Six Months Ended June 30, 2011 | ||||||||||||||||||||||||||||
Net | Losses | |||||||||||||||||||||||||||
Earned | and LAE | Underwriting | Underwriting | Loss | Expense | Combined | ||||||||||||||||||||||
Insurance Companies: | Premiums | Incurred | Expenses | Profit (Loss) | Ratio | Ratio | Ratio | |||||||||||||||||||||
Marine |
$ | 82,436 | $ | 54,806 | $ | 28,880 | $ | (1,250 | ) | 66.5 | % | 35.0 | % | 101.5 | % | |||||||||||||
Property Casualty |
98,286 | 74,364 | 38,056 | (14,134 | ) | 75.7 | % | 38.7 | % | 114.4 | % | |||||||||||||||||
Professional Liability |
33,085 | 22,957 | 12,804 | (2,676 | ) | 69.4 | % | 38.7 | % | 108.1 | % | |||||||||||||||||
213,807 | 152,127 | 79,740 | (18,060 | ) | 71.2 | % | 37.2 | % | 108.4 | % | ||||||||||||||||||
Lloyds Operations |
112,448 | 78,524 | 45,278 | (11,354 | ) | 69.8 | % | 40.3 | % | 110.1 | % | |||||||||||||||||
Total |
$ | 326,255 | $ | 230,651 | $ | 125,018 | $ | (29,414 | ) | 70.7 | % | 38.3 | % | 109.0 | % | |||||||||||||
Six Months Ended June 30, 2010 | ||||||||||||||||||||||||||||
Net | Losses | |||||||||||||||||||||||||||
Earned | and LAE | Underwriting | Underwriting | Loss | Expense | Combined | ||||||||||||||||||||||
Insurance Companies: | Premiums | Incurred | Expenses | Profit (Loss) | Ratio | Ratio | Ratio | |||||||||||||||||||||
Marine |
$ | 81,648 | $ | 51,654 | $ | 29,099 | $ | 895 | 63.3 | % | 35.6 | % | 98.9 | % | ||||||||||||||
Property Casualty |
101,252 | 57,062 | 39,508 | 4,682 | 56.4 | % | 39.0 | % | 95.4 | % | ||||||||||||||||||
Professional Liability |
38,736 | 24,549 | 14,721 | (534 | ) | 63.4 | % | 38.0 | % | 101.4 | % | |||||||||||||||||
221,636 | 133,265 | 83,328 | 5,043 | 60.1 | % | 37.6 | % | 97.7 | % | |||||||||||||||||||
Lloyds Operations |
103,904 | 70,405 | 36,593 | (3,094 | ) | 67.8 | % | 35.2 | % | 103.0 | % | |||||||||||||||||
Total |
$ | 325,540 | $ | 203,670 | $ | 119,921 | $ | 1,949 | 62.6 | % | 36.8 | % | 99.4 | % | ||||||||||||||
Amounts | Loss Ratio | |||||||||||||||
Net Incurred Loss Activity | June 30, | June 30, | June 30, | June 30, | ||||||||||||
For the Six Months Ended: | 2011 | 2010 | 2011 | 2010 | ||||||||||||
Insurance Companies: |
||||||||||||||||
Loss and LAE payments |
$ | 143,971 | $ | 140,771 | 67.4 | % | 63.5 | % | ||||||||
Change in reserves |
8,156 | (7,506 | ) | 3.8 | % | -3.4 | % | |||||||||
Net incurred loss and LAE |
152,127 | 133,265 | 71.2 | % | 60.1 | % | ||||||||||
Lloyds Operations: |
||||||||||||||||
Loss and LAE payments |
48,658 | 56,859 | 43.2 | % | 54.8 | % | ||||||||||
Change in reserves |
29,866 | 13,546 | 26.6 | % | 13.0 | % | ||||||||||
Net incurred loss and LAE |
78,524 | 70,405 | 69.8 | % | 67.8 | % | ||||||||||
Total |
||||||||||||||||
Loss and LAE payments |
192,629 | 197,630 | 59.0 | % | 60.7 | % | ||||||||||
Change in reserves |
38,022 | 6,040 | 11.7 | % | 1.9 | % | ||||||||||
Net incurred loss and LAE |
$ | 230,651 | $ | 203,670 | 70.7 | % | 62.6 | % | ||||||||
Impact of Prior Years Reserves | Amounts | Loss Ratio Impact | ||||||||||||||
Favorable / (Unfavorable) Development | June 30, | June 30, | June 30, | June 30, | ||||||||||||
For the Six Months Ended: | 2011 | 2010 | 2011 | 2010 | ||||||||||||
Insurance Companies |
$ | (1,085 | ) | $ | 5,497 | -0.5 | % | 2.5 | % | |||||||
Lloyds Operations |
(3,163 | ) | 999 | -2.8 | % | 1.0 | % | |||||||||
Total |
$ | (4,248 | ) | $ | 6,496 | -1.3 | % | 2.0 | % | |||||||
Case | IBNR | |||||||||||
Net Loss Reserves, June 30, 2011: | Reserves | Reserves | Total | |||||||||
Insurance Companies: |
||||||||||||
Marine |
$ | 119,153 | $ | 113,909 | $ | 233,062 | ||||||
Property Casualty |
160,477 | 307,334 | 467,811 | |||||||||
Professional Liability |
47,080 | 68,629 | 115,709 | |||||||||
Total Insurance Companies |
326,710 | 489,872 | 816,582 | |||||||||
Lloyds Operations: |
||||||||||||
Marine |
111,756 | 129,700 | 241,456 | |||||||||
Property Casualty |
37,087 | 28,509 | 65,596 | |||||||||
Professional Liability |
10,001 | 46,929 | 56,930 | |||||||||
Total Lloyds Operations |
158,844 | 205,138 | 363,982 | |||||||||
Total Net Loss Reserves |
$ | 485,554 | $ | 695,010 | $ | 1,180,564 | ||||||
Case | IBNR | |||||||||||
Net Loss Reserves, December 31, 2010: | Reserves | Reserves | Total | |||||||||
Insurance Companies: |
||||||||||||
Marine |
$ | 107,147 | $ | 109,361 | $ | 216,508 | ||||||
Property Casualty |
158,740 | 308,613 | 467,353 | |||||||||
Professional Liability |
46,096 | 78,469 | 124,565 | |||||||||
Total Insurance Companies |
311,983 | 496,443 | 808,426 | |||||||||
Lloyds Operations: |
||||||||||||
Marine |
111,914 | 112,708 | 224,622 | |||||||||
Property Casualty |
30,327 | 29,792 | 60,119 | |||||||||
Professional Liability |
9,904 | 39,471 | 49,375 | |||||||||
Total Lloyds Operations |
152,145 | 181,971 | 334,116 | |||||||||
Total Net Loss Reserves |
$ | 464,128 | $ | 678,414 | $ | 1,142,542 | ||||||
Gross | Gross | Cost or | OTTI | |||||||||||||||||
Fair | Unrealized | Unrealized | Amortized | Recognized | ||||||||||||||||
June 30, 2011 | Value | Gains | (Losses) | Cost | in OCI | |||||||||||||||
($ in thousands) | ||||||||||||||||||||
Fixed maturities: |
||||||||||||||||||||
U.S. Government Treasury bonds,
agency bonds and foreign government bonds |
$ | 291,492 | $ | 5,492 | $ | (610 | ) | $ | 286,610 | $ | | |||||||||
States, municipalities and political
Subdivisions |
374,873 | 15,910 | (962 | ) | 359,925 | | ||||||||||||||
Mortgage- and asset-backed securities: |
||||||||||||||||||||
Agency mortgage-backed securities |
365,497 | 12,752 | (864 | ) | 353,609 | | ||||||||||||||
Residential mortgage obligations |
25,948 | 40 | (2,266 | ) | 28,174 | (1,384 | ) | |||||||||||||
Asset-backed securities |
52,559 | 539 | (77 | ) | 52,097 | | ||||||||||||||
Commercial mortgage-backed securities |
218,429 | 6,480 | (800 | ) | 212,749 | | ||||||||||||||
Subtotal |
662,433 | 19,811 | (4,007 | ) | 646,629 | (1,384 | ) | |||||||||||||
Corporate bonds |
518,423 | 14,927 | (2,709 | ) | 506,205 | | ||||||||||||||
Total fixed maturities |
1,847,221 | 56,140 | (8,288 | ) | 1,799,369 | (1,384 | ) | |||||||||||||
Equity securities common stocks |
94,737 | 26,959 | (257 | ) | 68,035 | | ||||||||||||||
Cash |
40,340 | | | 40,340 | | |||||||||||||||
Short-term investments |
185,032 | | | 185,032 | | |||||||||||||||
Total |
$ | 2,167,330 | $ | 83,099 | $ | (8,545 | ) | $ | 2,092,776 | $ | (1,384 | ) | ||||||||
Gross | Gross | Cost or | ||||||||||||||
Fair | Unrealized | Unrealized | Amortized | |||||||||||||
Agency mortgage-backed securities: | Value | Gains | (Losses) | Cost | ||||||||||||
GNMA |
$ | 112,009 | $ | 5,147 | $ | (170 | ) | $ | 107,032 | |||||||
FNMA |
189,155 | 6,095 | (416 | ) | 183,476 | |||||||||||
FHLMC |
64,333 | 1,510 | (278 | ) | 63,101 | |||||||||||
Total |
$ | 365,497 | $ | 12,752 | $ | (864 | ) | $ | 353,609 | |||||||
Gross | Gross | Cost or | ||||||||||||||
Fair | Unrealized | Unrealized | Amortized | |||||||||||||
Residential mortgage obligations: | Value | Gains | (Losses) | Cost | ||||||||||||
Prime |
$ | 15,180 | $ | 40 | $ | (1,752 | ) | $ | 16,892 | |||||||
Alt-A |
2,195 | | (498 | ) | 2,693 | |||||||||||
Subprime |
| | | | ||||||||||||
Non-US RMBS |
8,573 | | (16 | ) | 8,589 | |||||||||||
Total |
$ | 25,948 | $ | 40 | $ | (2,266 | ) | $ | 28,174 | |||||||