Segment Information

12 Months Ended

Dec. 31, 2012

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

10. Segment Information:

We pursue our business activities primarily through subsidiaries whose operations are organized into producing units and are supported by our insurance carrier subsidiaries. Our non-carrier insurance activities are organized by business units into the following reportable segments:

· Standard Commercial Segment. The Standard Commercial Segment includes the standard lines commercial property/casualty insurance products and services handled by our Standard Commercial P&C business unit and the workers compensation insurance products handled by our Workers Compensation business unit. Our Standard Commercial P&C business unit is comprised of our American Hallmark Insurance Services and ECM subsidiaries. Our Workers Compensation business unit is comprised of our TBIC Holdings, TBIC and TBICRM subsidiaries. The Workers Compensation business unit was acquired July 1, 2011.

· Specialty Commercial Segment. The Specialty Commercial Segment includes the excess and surplus lines commercial property/casualty and medical professional liability insurance products and services handled by our E&S Commercial business unit, the general aviation insurance products and services handled by our General Aviation business unit and the commercial excess liability and umbrella products handled by our Excess & Umbrella business unit, as well as the Specialty Programs managed by Hallmark. Our E&S Commercial business unit is comprised of our HSU, PAAC and TGARSI subsidiaries. Our General Aviation business unit is comprised of our Aerospace Insurance Managers, ASRI and ACMG subsidiaries. Our Excess & Umbrella business unit is comprised of our HXS and HDS subsidiaries.

· Personal Segment. The Personal Segment includes the non-standard personal automobile, low value dwelling/homeowners, renters and motorcycle insurance products and services handled by our Personal Lines business unit which is comprised of American Hallmark General Agency, Inc. and Hallmark Claims Services, Inc., both of which do business as Hallmark Insurance Company.

The retained premium produced by these reportable segments is supported by the following insurance company subsidiaries:

· American Hallmark Insurance Company of Texas presently retains a portion of the risks on the commercial property/casualty and workers compensation policies marketed within the Standard Commercial Segment, retains a portion of the risks on personal policies marketed within the Personal Segment and retains a portion of the risks on the commercial, medical professional liability, aviation and satellite launch property/casualty policies marketed within the Specialty Commercial Segment.

· Hallmark Specialty Insurance Company presently retains a portion of the risks on the commercial property/casualty and medical professional liability policies marketed within the Specialty Commercial Segment and a portion of the commercial property/casualty policies marketed within the Standard Commercial Segment.

· Hallmark Insurance Company presently retains a portion of the risks on both the personal policies marketed within the Personal Segment and the commercial and aviation property/casualty products marketed within the Specialty Commercial Segment.

· Hallmark National Insurance Company was acquired on December 31, 2010. Commencing January 1, 2011, HNIC retains a portion of the risks on the personal policies marketed within the Personal Segment.

· Hallmark County Mutual Insurance Companycontrol and management is maintained through our wholly owned subsidiary, CYR Insurance Management Company (“CYR”). CYR has as its primary asset a management agreement with HCM which provides for CYR to have management and control of HCM. HCM is used to front certain lines of business in our Specialty Commercial and Personal Segments in Texas. HCM does not retain any business.

· Texas Builders Insurance Company was acquired on July 1, 2011 and retains a portion of the risks on the workers compensation policies marketed within our Standard Commercial Segment.

AHIC, HIC, HSIC and HNIC have entered into a pooling arrangement, pursuant to which AHIC retains 30% of the net premiums written by any of them, HIC retains 27% of the net premiums written by any of them, HSIC retains 30% of the net premiums written by any of them and HNIC retains 13% of the net premiums written by any of them. Neither HCM nor TBIC is a party to the intercompany pooling arrangement.

The following is additional business segment information for the twelve months ended December 31, 2012, 2011 and 2010 (in thousands):

	2012			2011			2010
				(as adjusted)			(as adjusted)
Revenues
Standard Commercial Segment	$	73,119		$	72,830		$	69,670
Speciality Commercial Segment		178,917			142,838			131,076
Personal Segment		89,149			101,351			96,741
Corporate		615			5,752			9,573
Consolidated	$	341,800		$	322,771		$	307,060
Depreciation and Amortization Expense
Standard Commercial Segment	$	186		$	174		$	159
Speciality Commercial Segment		2,892			3,293			3,703
Personal Segment		1,230			1,431			666
Corporate		113			166			223
Consolidated	$	4,421		$	5,064		$	4,751
Interest Expense
Standard Commercial Segment	$	-		$	-		$	-
Speciality Commercial Segment		-			-			-
Personal Segment		-			-			-
Corporate		4,634			4,631			4,598
Consolidated	$	4,634		$	4,631		$	4,598
Tax (Benefit) Expense
Standard Commercial Segment	$	372		$	(376	)	$	(1,378	)
Speciality Commercial Segment		1,875			4,454			4,021
Personal Segment		(968	)		(13,991	)		(763	)
Corporate		(1,753	)		959			(1,017	)
Consolidated	$	(474	)	$	(8,954	)	$	863
Pre-tax Income (Loss), net of non-controlling interest
Standard Commercial Segment	$	(2,486	)	$	1,335		$	(2,301	)
Speciality Commercial Segment		25,932			14,348			13,332
Personal Segment		(8,535	)		(29,647	)		(630	)
Corporate		(11,861	)		(5,881	)		(2,135	)
Consolidated	$	3,050		$	(19,845	)	$	8,266

The following is additional business segment information as of the following dates (in thousands):

	December 31,
	2012		2011
			(as adjusted)
Assets
Standard Commercial Segment	$	145,162	$	144,673
Specialty Commercial Segment		432,208		348,699
Personal Segment		200,356		232,381
Corporate		12,742		20,306
Consolidated	$	790,468	$	746,059