Ohio | 000-19289 | 31-1324304 | ||
(State or other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||
518 East Broad Street, Columbus, Ohio | 43215-3976 | |
(Address of principal executive offices) | (Zip Code) | |
¨ | 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)) |
Emerging growth company | ¨ |
Section 2. | Financial Information |
Item 2.02. | Results of Operations and Financial Condition. |
Section 9. | Financial Statements and Exhibits |
Item 9.01. | Financial Statements and Exhibits |
(c) | Exhibits. |
Exhibit No. | Description of Exhibit | ||
99.1 | Press release issued by State Auto Financial Corporation on November 1, 2018 regarding results of operations for the three and nine month periods ended September 30, 2018 |
STATE AUTO FINANCIAL CORPORATION | |
Date: November 1, 2018 | /s/ Steven E. English |
Senior Vice President and Chief Financial Officer |
State Auto Financial Corporation |
Media contact: |
Kyle Anderson, 614-917-5497 |
Kyle.Anderson@StateAuto.com |
or |
Investor contact: |
Natalie Schoolcraft, 614-917-4341 |
Natalie.Schoolcraft@StateAuto.com |
Selected Consolidated Financial Data | ||||||||||||||||
($ in millions, except per share amounts) | ||||||||||||||||
(unaudited) | Three months ended September 30 | Nine months ended September 30 | ||||||||||||||
2018 | 2017 | 2018 | 20172 | |||||||||||||
Net premiums written | $ | 312.4 | $ | 321.3 | $ | 912.7 | $ | 969.4 | ||||||||
Earned premiums | 306.8 | 319.0 | 929.2 | 957.2 | ||||||||||||
Net investment income | 20.8 | 18.7 | 62.2 | 56.5 | ||||||||||||
Net investment gain | 17.8 | 20.2 | 18.2 | 43.8 | ||||||||||||
Other income | 0.6 | 0.5 | 1.8 | 1.7 | ||||||||||||
Total revenue | 346.0 | 358.4 | 1,011.4 | 1,059.2 | ||||||||||||
Income (loss) before federal income taxes | 41.0 | (11.2 | ) | 45.4 | (3.3 | ) | ||||||||||
Federal income tax expense (benefit) | 7.6 | (1.7 | ) | 8.1 | 0.8 | |||||||||||
Net income (loss) | $ | 33.4 | $ | (9.5 | ) | $ | 37.3 | $ | (4.1 | ) | ||||||
Earnings (loss) per common share: | ||||||||||||||||
- basic | $ | 0.78 | $ | (0.23 | ) | $ | 0.87 | $ | (0.10 | ) | ||||||
- diluted | $ | 0.76 | $ | (0.23 | ) | $ | 0.86 | $ | (0.10 | ) | ||||||
Earnings (loss) per share from operations (A): | ||||||||||||||||
- basic | $ | 0.45 | $ | (0.54 | ) | $ | 0.54 | $ | (0.78 | ) | ||||||
- diluted | $ | 0.44 | $ | (0.54 | ) | $ | 0.53 | $ | (0.78 | ) | ||||||
Weighted average shares outstanding: | ||||||||||||||||
- basic | 43.0 | 42.2 | 42.8 | 42.0 | ||||||||||||
- diluted | 43.6 | 42.2 | 43.3 | 42.0 | ||||||||||||
Return on average equity (LTM) | 3.0 | % | 3.2 | % | ||||||||||||
Book value per share | $ | 20.24 | $ | 21.16 | ||||||||||||
Dividends paid per share | $ | 0.10 | $ | 0.10 | $ | 0.30 | $ | 0.30 | ||||||||
Total shares outstanding | 43.0 | 42.2 | ||||||||||||||
GAAP ratios: | ||||||||||||||||
Cat loss and ALAE ratio | 5.3 | 17.6 | 6.8 | 12.1 | ||||||||||||
Non-cat loss and LAE ratio | 57.0 | 61.9 | 60.0 | 62.9 | ||||||||||||
Loss and LAE ratio | 62.3 | 79.5 | 66.8 | 75.0 | ||||||||||||
Expense ratio | 36.1 | 35.3 | 35.8 | 34.9 | ||||||||||||
Combined ratio | 98.4 | 114.8 | 102.6 | 109.9 | ||||||||||||
(A) Reconciliation of non-GAAP financial measure: | ||||||||||||||||
Net income (loss) from operations: | ||||||||||||||||
Net income | $ | 33.4 | $ | (9.5 | ) | $ | 37.3 | $ | (4.1 | ) | ||||||
Net investment gain, net of tax | 14.0 | 13.1 | 14.3 | 28.5 | ||||||||||||
Net income (loss) from operations | $ | 19.4 | $ | (22.6 | ) | $ | 23.0 | $ | (32.6 | ) | ||||||
Condensed Consolidated Balance Sheets | ||||||||
($ and shares in millions, except per share amounts) | ||||||||
(unaudited) | September 30 | December 31 | ||||||
2018 | 20172 | |||||||
ASSETS | ||||||||
Fixed maturities, available-for-sale, at fair value (amortized cost $2,185.2 and $2,173.1, respectively) | $ | 2,141.6 | $ | 2,192.8 | ||||
Equity securities | 376.3 | 365.3 | ||||||
Other invested assets | 54.5 | 56.0 | ||||||
Other invested assets, at cost | 5.6 | 5.6 | ||||||
Notes receivable from affiliate | 70.0 | 70.0 | ||||||
Total investments | 2,648.0 | 2,689.7 | ||||||
Cash and cash equivalents | 49.5 | 91.5 | ||||||
Accrued investment income and other assets | 39.5 | 36.5 | ||||||
Deferred policy acquisition costs | 104.5 | 110.3 | ||||||
Reinsurance recoverable on losses and loss expenses payable | 5.0 | 3.1 | ||||||
Prepaid reinsurance premiums | 6.8 | 6.4 | ||||||
Due from affiliate | 10.6 | — | ||||||
Current federal income taxes | 5.9 | 4.8 | ||||||
Net deferred federal income taxes | 62.3 | 58.8 | ||||||
Property and equipment, net | 7.1 | 7.3 | ||||||
Total assets | $ | 2,939.2 | $ | 3,008.4 | ||||
LIABILITIES | ||||||||
Losses and loss expenses payable | $ | 1,198.7 | $ | 1,255.6 | ||||
Unearned premiums | 595.6 | 611.8 | ||||||
Notes payable (affiliates $15.2 and $15.2, respectively) | 122.0 | 122.1 | ||||||
Pension and postretirement benefits | 52.1 | 64.5 | ||||||
Due to affiliate | — | 2.7 | ||||||
Other liabilities | 101.4 | 76.7 | ||||||
Total liabilities | 2,069.8 | 2,133.4 | ||||||
STOCKHOLDERS' EQUITY | ||||||||
Common stock, without par value. Authorized 100.0 shares; 49.8 and 49.2 shares issued, respectively, at stated value of $2.50 per share | 124.5 | 123.0 | ||||||
Treasury stock, 6.8 and 6.8 shares, respectively, at cost | (117.0 | ) | (116.8 | ) | ||||
Additional paid-in capital | 188.6 | 171.8 | ||||||
Accumulated other comprehensive (loss) income | (68.3 | ) | 36.7 | |||||
Retained earnings | 741.6 | 660.3 | ||||||
Total stockholders' equity | 869.4 | 875.0 | ||||||
Total liabilities and stockholders' equity | $ | 2,939.2 | $ | 3,008.4 | ||||
Condensed Consolidated Statements of Income | ||||||||||||||||
($ in millions, except per share amounts) | ||||||||||||||||
(unaudited) | Three months ended | Nine months ended | ||||||||||||||
September 30 | September 30 | |||||||||||||||
2018 | 2017 | 2018 | 20172 | |||||||||||||
Earned premiums | $ | 306.8 | $ | 319.0 | $ | 929.2 | $ | 957.2 | ||||||||
Net investment income | 20.8 | 18.7 | 62.2 | 56.5 | ||||||||||||
Net investment gain | 17.8 | 20.2 | 18.2 | 43.8 | ||||||||||||
Other income from affiliates | 0.6 | 0.5 | 1.8 | 1.7 | ||||||||||||
Total revenues | 346.0 | 358.4 | 1,011.4 | 1,059.2 | ||||||||||||
Losses and loss expenses | 191.0 | 253.5 | 621.1 | 718.2 | ||||||||||||
Acquisition and operating expenses | 110.9 | 112.7 | 333.0 | 334.1 | ||||||||||||
Interest expense | 1.2 | 1.5 | 4.5 | 4.4 | ||||||||||||
Other expenses | 1.9 | 1.9 | 7.4 | 5.8 | ||||||||||||
Total expenses | 305.0 | 369.6 | 966.0 | 1,062.5 | ||||||||||||
Income (loss) before federal income taxes | 41.0 | (11.2 | ) | 45.4 | (3.3 | ) | ||||||||||
Federal income tax expense (benefit) | 7.6 | (1.7 | ) | 8.1 | 0.8 | |||||||||||
Net income (loss) | $ | 33.4 | $ | (9.5 | ) | $ | 37.3 | $ | (4.1 | ) | ||||||
Earnings (loss) per common share: | ||||||||||||||||
Basic | $ | 0.78 | $ | (0.23 | ) | $ | 0.87 | $ | (0.10 | ) | ||||||
Diluted | $ | 0.76 | $ | (0.23 | ) | $ | 0.86 | $ | (0.10 | ) | ||||||
Dividends paid per common share | $ | 0.10 | $ | 0.10 | $ | 0.30 | $ | 0.30 | ||||||||
Consolidated Statements of Comprehensive Income | |||
($ in millions) | |||
(unaudited) | Three months ended | ||
September 30 | |||
2018 | |||
Net income | $ | 33.4 | |
Other comprehensive loss, net of tax: | |||
Net unrealized holding losses on fixed maturities: | |||
Unrealized holding losses | (14.7 | ) | |
Reclassification adjustments for gains realized in net income | — | ||
Income tax benefit | 3.1 | ||
Total net unrealized holding losses on fixed maturities | (11.6 | ) | |
Net unrecognized benefit plan obligations: | |||
Reclassification adjustments for amortization to statements of income: | |||
Prior service credit | (1.4 | ) | |
Net actuarial loss | 2.2 | ||
Income tax expense | (0.2 | ) | |
Total net unrecognized benefit plan obligations | 0.6 | ||
Other comprehensive loss | (11.0 | ) | |
Comprehensive income | $ | 22.5 | |
($ in millions) | Three months ended | ||
(unaudited) | September 30 | ||
2017 | |||
Net loss | $ | (9.5 | ) |
Other comprehensive income, net of tax: | |||
Net unrealized holding gains on investments: | |||
Unrealized holding gains | 11.0 | ||
Reclassification adjustments for gains realized in net income | (20.2 | ) | |
Income tax benefit | 3.2 | ||
Total net unrealized holding losses on investments | (6.0 | ) | |
Net unrecognized benefit plan obligations: | |||
Reclassification adjustments for amortization to statements of income: | |||
Prior service credit | (1.3 | ) | |
Net actuarial loss | 2.1 | ||
Income tax expense | (0.3 | ) | |
Total net unrecognized benefit plan obligations | 0.5 | ||
Other comprehensive loss | (5.5 | ) | |
Comprehensive loss | $ | (15.0 | ) |
Consolidated Statements of Comprehensive Income | |||
($ in millions) | |||
(unaudited) | Nine months ended | ||
September 30 | |||
2018 | |||
Net income | $ | 37.3 | |
Other comprehensive loss, net of tax: | |||
Net unrealized holding losses on fixed maturities: | |||
Unrealized holding losses | (61.6 | ) | |
Reclassification adjustments for gains realized in net income | (1.7 | ) | |
Income tax benefit | 13.3 | ||
Total net unrealized holding losses on fixed maturities | (50.0 | ) | |
Net unrecognized benefit plan obligations: | |||
Reclassification adjustments for amortization to statements of income: | |||
Prior service credit | (4.1 | ) | |
Net actuarial loss | 6.4 | ||
Income tax expense | (0.5 | ) | |
Total net unrecognized benefit plan obligations | 1.8 | ||
Other comprehensive loss | (48.2 | ) | |
Comprehensive loss | $ | (10.9 | ) |
($ in millions) | Nine months ended | ||
September 30 | |||
20172 | |||
Net loss | $ | (4.1 | ) |
Other comprehensive income, net of tax: | |||
Net unrealized holding gains on investments: | |||
Unrealized holding gains | 65.6 | ||
Reclassification adjustments for gains realized in net income | (43.8 | ) | |
Income tax expense | (7.6 | ) | |
Total net unrealized holding gains on investments | 14.2 | ||
Net unrecognized benefit plan obligations: | |||
Reclassification adjustments for amortization to statements of income: | |||
Prior service credit | (4.1 | ) | |
Net actuarial loss | 6.1 | ||
Income tax expense | (0.8 | ) | |
Total net unrecognized benefit plan obligations | 1.2 | ||
Other comprehensive income | 15.4 | ||
Comprehensive income | $ | 11.3 | |
Condensed Consolidated Statement of Stockholders' Equity | ||||||||
($ and shares in millions) | ||||||||
(unaudited) | Nine Months Ended | Year Ended | ||||||
September 30 | December 31 | |||||||
2018 | 20172 | |||||||
Common shares: | ||||||||
Balance at beginning of year | 49.2 | 48.6 | ||||||
Issuance of shares | 0.6 | 0.6 | ||||||
Balance at period ended | 49.8 | 49.2 | ||||||
Treasury shares: | ||||||||
Balance at beginning of year | (6.8 | ) | (6.8 | ) | ||||
Balance at period ended | (6.8 | ) | (6.8 | ) | ||||
Common stock: | ||||||||
Balance at beginning of year | $ | 123.0 | $ | 121.6 | ||||
Issuance of shares | 1.5 | 1.4 | ||||||
Balance at period ended | 124.5 | 123.0 | ||||||
Treasury stock: | ||||||||
Balance at beginning of year | $ | (116.8 | ) | $ | (116.5 | ) | ||
Shares acquired on stock award exercises and vested restricted shares | (0.2 | ) | (0.3 | ) | ||||
Balance at beginning of year and period ended | (117.0 | ) | (116.8 | ) | ||||
Additional paid-in capital: | ||||||||
Balance at beginning of year | $ | 171.8 | $ | 159.9 | ||||
Issuance of common stock | 10.1 | 8.8 | ||||||
Stock awards granted | 6.7 | 3.1 | ||||||
Balance at period ended | 188.6 | 171.8 | ||||||
Accumulated other comprehensive income: | ||||||||
Balance at beginning of the year | $ | 36.7 | $ | 32.5 | ||||
Cumulative effect of change in accounting for equity securities and other invested assets and reclassification of stranded tax effects as of January 1, 2018 | (56.8 | ) | — | |||||
Adjusted beginning balance at January 1, 2018 | — | |||||||
Change in unrealized losses on available-for-sale investments, net of tax | (50.0 | ) | 3.2 | |||||
Change in unrecognized benefit plan obligations, net of tax | 1.8 | 1.0 | ||||||
Balance at period ended | (68.3 | ) | 36.7 | |||||
Retained earnings: | ||||||||
Balance at beginning of year | $ | 660.3 | $ | 687.9 | ||||
Cumulative effect of change in accounting for equity securities and other invested assets and reclassification of stranded tax effects as of January 1, 2018 | 56.8 | — | ||||||
Adjusted beginning balance at January 1, 2018 | 717.1 | — | ||||||
Net income (loss) | 37.3 | (10.7 | ) | |||||
Cash dividends paid | (12.8 | ) | (16.9 | ) | ||||
Balance at period ended | 741.6 | 660.3 | ||||||
Total stockholders' equity at period ended | $ | 869.4 | $ | 875.0 | ||||
Condensed Consolidated Statements of Cash Flow | ||||||||
($ in millions) | ||||||||
(unaudited) | Nine months ended | |||||||
September 30 | ||||||||
2018 | 20172 | |||||||
Cash flows from operating activities: | ||||||||
Net income (loss) | $ | 37.3 | $ | (4.1 | ) | |||
Adjustments to reconcile net income to net cash (used in) provided by operating activities: | ||||||||
Depreciation and amortization, net | 6.7 | 9.9 | ||||||
Share-based compensation | 6.7 | 3.0 | ||||||
Net investment gain | (18.2 | ) | (43.8 | ) | ||||
Changes in operating assets and liabilities: | ||||||||
Deferred policy acquisition costs | 5.8 | 7.2 | ||||||
Accrued investment income and other assets | (3.0 | ) | 2.0 | |||||
Postretirement and pension benefits | (10.6 | ) | (9.1 | ) | ||||
Other liabilities and due to/from affiliates, net | 11.8 | (15.1 | ) | |||||
Reinsurance recoverable on losses and loss expenses payable and prepaid reinsurance premiums | (2.3 | ) | (1.9 | ) | ||||
Losses and loss expenses payable | (56.9 | ) | 98.9 | |||||
Unearned premiums | (16.2 | ) | 12.7 | |||||
Deferred tax expense on share-based awards | — | 1.3 | ||||||
Federal income taxes | 8.6 | (0.3 | ) | |||||
Net cash (used in) provided by operating activities | (30.3 | ) | 60.7 | |||||
Cash flows from investing activities: | ||||||||
Purchases of fixed maturities available-for-sale | (267.0 | ) | (409.2 | ) | ||||
Purchases of equity securities | (82.2 | ) | (104.1 | ) | ||||
Purchases of other invested assets | (1.1 | ) | (1.0 | ) | ||||
Maturities, calls and pay downs of fixed maturities available-for-sale | 180.4 | 192.1 | ||||||
Sales of fixed maturities available-for-sale | 69.7 | 156.3 | ||||||
Sales of equity securities | 89.3 | 171.3 | ||||||
Sales of other invested assets | 0.9 | 0.8 | ||||||
Net cash (used in) provided by investing activities | (10.0 | ) | 6.2 | |||||
Cash flows from financing activities: | ||||||||
Proceeds from issuance of common stock | 11.7 | 6.0 | ||||||
Payments to acquire treasury stock | (0.2 | ) | (0.2 | ) | ||||
Payment of dividends | (12.8 | ) | (12.7 | ) | ||||
Payment of prepayment fee | (0.4 | ) | — | |||||
Net cash used in financing activities | (1.7 | ) | (6.9 | ) | ||||
Net (decrease) increase in cash and cash equivalents | (42.0 | ) | 60.0 | |||||
Cash and cash equivalents at beginning of period | 91.5 | 51.1 | ||||||
Cash and cash equivalents at end of period | $ | 49.5 | $ | 111.1 | ||||
Supplemental disclosures: | ||||||||
Interest paid (affiliates $0.7 and $0.6, respectively) | $ | 4.5 | $ | 4.3 | ||||
Net Investment Income | ||||||||||||||||||||
($ in millions) | ||||||||||||||||||||
(unaudited) | ||||||||||||||||||||
9/30/2017 | 12/31/2017 | 3/31/2018 | 6/30/2018 | 9/30/2018 | ||||||||||||||||
Quarter to Date | ||||||||||||||||||||
Gross investment income: | ||||||||||||||||||||
Fixed maturities | $ | 14.8 | $ | 14.5 | $ | 15.0 | $ | 14.9 | $ | 15.1 | ||||||||||
TIPS | 0.6 | 1.6 | 1.1 | 2.0 | 1.3 | |||||||||||||||
Total fixed maturities | 15.4 | 16.1 | 16.1 | 16.9 | 16.4 | |||||||||||||||
Equity securities | 2.0 | 4.8 | 2.5 | 3.1 | 3.0 | |||||||||||||||
Other | 1.6 | 1.7 | 1.7 | 1.8 | 1.7 | |||||||||||||||
Total gross investment income | 19.0 | 22.6 | 20.3 | 21.8 | 21.1 | |||||||||||||||
Less: Investment expenses | 0.3 | 0.3 | 0.4 | 0.3 | 0.3 | |||||||||||||||
Net investment income | $ | 18.7 | $ | 22.3 | $ | 19.9 | $ | 21.5 | $ | 20.8 | ||||||||||
Year to Date | ||||||||||||||||||||
Gross investment income: | ||||||||||||||||||||
Fixed maturities | $ | 43.6 | $ | 58.1 | $ | 15.0 | $ | 29.9 | $ | 45.0 | ||||||||||
TIPS | 3.5 | 5.1 | 1.1 | 3.1 | 4.4 | |||||||||||||||
Total fixed maturities | 47.1 | 63.2 | 16.1 | 33.0 | 49.4 | |||||||||||||||
Equity securities | 5.7 | 10.5 | 2.5 | 5.6 | 8.6 | |||||||||||||||
Other | 4.6 | 6.3 | 1.7 | 3.5 | 5.2 | |||||||||||||||
Total gross investment income | 57.4 | 80.0 | 20.3 | 42.1 | 63.2 | |||||||||||||||
Less: Investment expenses | 0.9 | 1.2 | 0.4 | 0.7 | 1.0 | |||||||||||||||
Net investment income | $ | 56.5 | $ | 78.8 | $ | 19.9 | $ | 41.4 | $ | 62.2 | ||||||||||
9/30/2017 | 12/31/2017 | 3/31/2018 | 6/30/2018 | 9/30/2018 | ||||||||||||||||
TIPS, fair value | $ | 153.5 | $ | 155.8 | $ | 147.4 | $ | 156.5 | $ | 143.8 | ||||||||||
TIPS, book value | $ | 145.5 | $ | 146.5 | $ | 140.7 | $ | 150.6 | $ | 140.8 | ||||||||||
Income Taxes | ||||||||||||||||
($ in millions) | ||||||||||||||||
(unaudited) | ||||||||||||||||
The following table sets forth the tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities: | ||||||||||||||||
September 30 | June 30 | March 31 | December 31 | |||||||||||||
2018 | 2018 | 2018 | 20172 | |||||||||||||
Deferred tax assets: | ||||||||||||||||
Unearned premiums not currently deductible | $ | 24.8 | $ | 24.5 | $ | 24.6 | $ | 25.5 | ||||||||
Losses and loss expenses payable discounting | 11.2 | 11.6 | 11.6 | 22.0 | ||||||||||||
Postretirement and pension benefits | 10.9 | 12.1 | 13.4 | 13.6 | ||||||||||||
Net unrealized holding losses on investments | 9.2 | 6.1 | 3.7 | — | ||||||||||||
Realized loss on other-than-temporary impairment | 1.9 | 1.9 | 2.2 | 2.1 | ||||||||||||
Other liabilities | 12.2 | 10.4 | 8.8 | 9.2 | ||||||||||||
Net operating loss carryforward | 25.0 | 30.3 | 29.9 | 34.3 | ||||||||||||
Tax credit carryforwards | 2.7 | 2.7 | 2.7 | 3.7 | ||||||||||||
Other | — | — | — | 2.5 | ||||||||||||
Total deferred tax assets | 97.9 | 99.6 | 96.9 | 112.9 | ||||||||||||
Deferred tax liabilities: | ||||||||||||||||
Deferral of policy acquisition costs | 21.9 | 22.0 | 22.1 | 23.1 | ||||||||||||
Net unrealized holding gains on investments | — | — | — | 20.3 | ||||||||||||
Other | 13.7 | 10.5 | 8.2 | 10.7 | ||||||||||||
Total deferred tax liabilities | 35.6 | 32.5 | 30.3 | 54.1 | ||||||||||||
Net deferred federal income taxes | $ | 62.3 | $ | 67.1 | $ | 66.6 | $ | 58.8 | ||||||||
The following table sets forth the components of federal income tax expense (benefit): | ||||||||||||||||
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
2018 | 2017 | 2018 | 20172 | |||||||||||||
Income (loss) before federal income taxes | $ | 41.0 | $ | (11.2 | ) | $ | 45.4 | $ | (3.3 | ) | ||||||
Federal income tax expense (benefit): | ||||||||||||||||
Current | (0.1 | ) | (0.1 | ) | (1.1 | ) | — | |||||||||
Deferred | 7.7 | (1.6 | ) | 9.2 | 0.8 | |||||||||||
Total federal income tax expense (benefit) | 7.6 | (1.7 | ) | 8.1 | 0.8 | |||||||||||
Net income (loss) | $ | 33.4 | $ | (9.5 | ) | $ | 37.3 | $ | (4.1 | ) | ||||||
SAP Personal Insurance Segment Results | ||||||||||||||||
(unaudited) | ||||||||||||||||
($ in millions) | ||||||||||||||||
Three months ended September 30, 2018 | Personal Auto | Homeowners | Other Personal | Total | ||||||||||||
Net written premiums | $ | 110.7 | $ | 76.6 | $ | 8.0 | $ | 195.3 | ||||||||
Net earned premiums | 103.5 | 63.7 | 5.8 | 173.0 | ||||||||||||
Losses and LAE incurred: | ||||||||||||||||
Cat loss and ALAE | 0.9 | 11.1 | 0.8 | 12.8 | ||||||||||||
Non-cat loss and ALAE | ||||||||||||||||
Prior accident years non-cat loss and ALAE | (7.3 | ) | (1.5 | ) | (0.8 | ) | (9.6 | ) | ||||||||
Current accident year non-cat loss and ALAE | 61.9 | 27.6 | 2.4 | 91.9 | ||||||||||||
Total non-cat loss and ALAE | 54.6 | 26.1 | 1.6 | 82.3 | ||||||||||||
Total Loss and ALAE | 55.5 | 37.2 | 2.4 | 95.1 | ||||||||||||
ULAE | 6.8 | 3.8 | 0.1 | 10.7 | ||||||||||||
Total Loss and LAE | 62.3 | 41.0 | 2.5 | 105.8 | ||||||||||||
Underwriting expenses | 32.6 | 24.9 | 2.8 | 60.3 | ||||||||||||
Net underwriting gain (loss) | $ | 8.6 | $ | (2.2 | ) | $ | 0.5 | $ | 6.9 | |||||||
Cat loss and ALAE ratio | 0.8 | % | 17.4 | % | 13.7 | % | 7.4 | % | ||||||||
Non-cat loss and ALAE ratio | ||||||||||||||||
Prior accident years non-cat loss and ALAE ratio | (7.1 | )% | (2.3 | )% | (14.5 | )% | (5.6 | )% | ||||||||
Current accident year non-cat loss and ALAE ratio | 59.8 | % | 43.2 | % | 43.0 | % | 53.1 | % | ||||||||
Total non-cat loss and ALAE ratio | 52.7 | % | 40.9 | % | 28.5 | % | 47.5 | % | ||||||||
Total Loss and ALAE ratio | 53.5 | % | 58.3 | % | 42.2 | % | 54.9 | % | ||||||||
ULAE ratio | 6.6 | % | 5.9 | % | 1.1 | % | 6.2 | % | ||||||||
Total Loss and LAE ratio | 60.1 | % | 64.2 | % | 43.3 | % | 61.1 | % | ||||||||
Expense ratio | 29.5 | % | 32.6 | % | 34.4 | % | 30.9 | % | ||||||||
Combined ratio | 89.6 | % | 96.8 | % | 77.7 | % | 92.0 | % |
($ in millions) | ||||||||||||||||
Three months ended September 30, 2017 | Personal Auto | Homeowners | Other Personal | Total | ||||||||||||
Net written premiums | $ | 96.5 | $ | 64.1 | $ | 4.9 | $ | 165.5 | ||||||||
Net earned premiums | 84.9 | 54.6 | 4.6 | 144.1 | ||||||||||||
Losses and LAE incurred: | ||||||||||||||||
Cat loss and ALAE | 2.5 | 5.1 | 0.4 | 8.0 | ||||||||||||
Non-cat loss and ALAE | ||||||||||||||||
Prior accident years non-cat loss and ALAE | (0.5 | ) | — | 0.4 | (0.1 | ) | ||||||||||
Current accident year non-cat loss and ALAE | 60.3 | 24.0 | 1.1 | 85.4 | ||||||||||||
Total non-cat loss and ALAE | 59.8 | 24.0 | 1.5 | 85.3 | ||||||||||||
Total Loss and ALAE | 62.3 | 29.1 | 1.9 | 93.3 | ||||||||||||
ULAE | 5.5 | 3.2 | 0.2 | 8.9 | ||||||||||||
Total Loss and LAE | 67.8 | 32.3 | 2.1 | 102.2 | ||||||||||||
Underwriting expenses | 26.8 | 20.9 | 1.6 | 49.3 | ||||||||||||
Net underwriting (loss) gain | $ | (9.7 | ) | $ | 1.4 | $ | 0.9 | $ | (7.4 | ) | ||||||
Cat loss and ALAE ratio | 3.0 | % | 9.3 | % | 8.3 | % | 5.6 | % | ||||||||
Non-cat loss and ALAE ratio | ||||||||||||||||
Prior accident years non-cat loss and ALAE ratio | (0.6 | )% | — | % | 7.6 | % | (0.1 | )% | ||||||||
Current accident year non-cat loss and ALAE ratio | 71.0 | % | 44.1 | % | 25.8 | % | 59.3 | % | ||||||||
Total non-cat loss and ALAE ratio | 70.4 | % | 44.1 | % | 33.4 | % | 59.2 | % | ||||||||
Total Loss and ALAE ratio | 73.4 | % | 53.4 | % | 41.7 | % | 64.8 | % | ||||||||
ULAE ratio | 6.5 | % | 5.8 | % | 2.8 | % | 6.1 | % | ||||||||
Total Loss and LAE ratio | 79.9 | % | 59.2 | % | 44.5 | % | 70.9 | % | ||||||||
Expense ratio | 27.7 | % | 32.6 | % | 35.8 | % | 29.8 | % | ||||||||
Combined ratio | 107.6 | % | 91.8 | % | 80.3 | % | 100.7 | % |
($ in millions) | ||||||||||||||||
Nine months ended September 30, 2018 | Personal Auto | Homeowners | Other Personal | Total | ||||||||||||
Net written premiums | $ | 318.8 | $ | 203.0 | $ | 20.1 | $ | 541.9 | ||||||||
Net earned premiums | 296.1 | 182.0 | 16.1 | 494.2 | ||||||||||||
Losses and LAE incurred: | ||||||||||||||||
Cat loss and ALAE | 4.8 | 38.1 | 2.2 | 45.1 | ||||||||||||
Non-cat loss and ALAE | ||||||||||||||||
Prior accident years non-cat loss and ALAE | (18.5 | ) | (7.2 | ) | (1.1 | ) | (26.8 | ) | ||||||||
Current accident year non-cat loss and ALAE | 193.6 | 81.9 | 8.0 | 283.5 | ||||||||||||
Total non-cat loss and ALAE | 175.1 | 74.7 | 6.9 | 256.7 | ||||||||||||
Total Loss and ALAE | 179.9 | 112.8 | 9.1 | 301.8 | ||||||||||||
ULAE | 17.7 | 12.4 | 0.6 | 30.7 | ||||||||||||
Total Loss and LAE | 197.6 | 125.2 | 9.7 | 332.5 | ||||||||||||
Underwriting expenses | 92.9 | 65.9 | 7.5 | 166.3 | ||||||||||||
Net underwriting gain (loss) | $ | 5.6 | $ | (9.1 | ) | $ | (1.1 | ) | $ | (4.6 | ) | |||||
Cat loss and ALAE ratio | 1.6 | % | 20.9 | % | 13.5 | % | 9.1 | % | ||||||||
Non-cat loss and ALAE ratio | ||||||||||||||||
Prior accident years non-cat loss and ALAE ratio | (6.3 | )% | (3.9 | )% | (7.1 | )% | (5.4 | )% | ||||||||
Current accident year non-cat loss and ALAE ratio | 65.4 | % | 45.0 | % | 50.0 | % | 57.4 | % | ||||||||
Total non-cat loss and ALAE ratio | 59.1 | % | 41.1 | % | 42.9 | % | 52.0 | % | ||||||||
Total Loss and ALAE ratio | 60.7 | % | 62.0 | % | 56.4 | % | 61.1 | % | ||||||||
ULAE ratio | 6.0 | % | 6.8 | % | 3.7 | % | 6.2 | % | ||||||||
Total Loss and LAE ratio | 66.7 | % | 68.8 | % | 60.1 | % | 67.3 | % | ||||||||
Expense ratio | 29.1 | % | 32.5 | % | 37.2 | % | 30.7 | % | ||||||||
Combined ratio | 95.8 | % | 101.3 | % | 97.3 | % | 98.0 | % |
($ in millions) | ||||||||||||||||
Nine months ended September 30, 2017 | Personal Auto3 | Homeowners | Other Personal | Total2 | ||||||||||||
Net written premiums | $ | 265.3 | $ | 168.9 | $ | 13.7 | $ | 447.9 | ||||||||
Net earned premiums | 251.8 | 164.6 | 14.2 | 430.6 | ||||||||||||
Losses and LAE incurred: | ||||||||||||||||
Cat loss and ALAE | 8.4 | 34.2 | 1.1 | 43.7 | ||||||||||||
Non-cat loss and ALAE | ||||||||||||||||
Prior accident years non-cat loss and ALAE | (2.3 | ) | 1.9 | 2.5 | 2.1 | |||||||||||
Current accident year non-cat loss and ALAE | 178.9 | 72.0 | 4.3 | 255.2 | ||||||||||||
Total non-cat loss and ALAE | 176.6 | 73.9 | 6.8 | 257.3 | ||||||||||||
Total Loss and ALAE | 185.0 | 108.1 | 7.9 | 301.0 | ||||||||||||
ULAE | 15.8 | 11.3 | 0.9 | 28.0 | ||||||||||||
Total Loss and LAE | 200.8 | 119.4 | 8.8 | 329.0 | ||||||||||||
Underwriting expenses | 73.4 | 54.7 | 4.9 | 133.0 | ||||||||||||
Net underwriting (loss) gain | $ | (22.4 | ) | $ | (9.5 | ) | $ | 0.5 | $ | (31.4 | ) | |||||
Cat loss and ALAE ratio | 3.3 | % | 20.8 | % | 7.5 | % | 10.2 | % | ||||||||
Non-cat loss and ALAE ratio | ||||||||||||||||
Prior accident years non-cat loss and ALAE ratio | (0.9 | )% | 1.2 | % | 17.3 | % | 0.5 | % | ||||||||
Current accident year non-cat loss and ALAE ratio | 71.0 | % | 43.7 | % | 30.9 | % | 59.3 | % | ||||||||
Total non-cat loss and ALAE ratio | 70.1 | % | 44.9 | % | 48.2 | % | 59.8 | % | ||||||||
Total Loss and ALAE ratio | 73.4 | % | 65.7 | % | 55.7 | % | 70.0 | % | ||||||||
ULAE ratio | 6.3 | % | 6.8 | % | 6.4 | % | 6.5 | % | ||||||||
Total Loss and LAE ratio | 79.7 | % | 72.5 | % | 62.1 | % | 76.5 | % | ||||||||
Expense ratio | 27.6 | % | 32.4 | % | 36.5 | % | 29.7 | % | ||||||||
Combined ratio | 107.3 | % | 104.9 | % | 98.6 | % | 106.2 | % |
SAP Commercial Insurance Segment Results | ||||||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||||||
($ in millions) | ||||||||||||||||||||||||||||
Three months ended September 30, 2018 | Commercial Auto | Small Commercial Package | Middle Market Commercial | Workers' Comp | Farm & Ranch | Other Commercial | Total | |||||||||||||||||||||
Net written premiums | $ | 19.1 | $ | 29.1 | $ | 29.8 | $ | 24.1 | $ | 10.7 | $ | 4.8 | $ | 117.6 | ||||||||||||||
Net earned premiums | 18.8 | 30.5 | 28.6 | 21.3 | 11.3 | 4.7 | 115.2 | |||||||||||||||||||||
Losses and LAE incurred: | ||||||||||||||||||||||||||||
Cat loss and ALAE | (0.4 | ) | 2.1 | 0.5 | — | 0.8 | 0.1 | 3.1 | ||||||||||||||||||||
Non-cat loss and ALAE | ||||||||||||||||||||||||||||
Prior accident years non-cat loss and ALAE | (1.1 | ) | (1.8 | ) | (1.9 | ) | (2.5 | ) | (1.0 | ) | (2.0 | ) | (10.3 | ) | ||||||||||||||
Current accident year non-cat loss and ALAE | 11.5 | 18.5 | 18.7 | 14.3 | 6.5 | 2.3 | 71.8 | |||||||||||||||||||||
Total non-cat loss and ALAE | 10.4 | 16.7 | 16.8 | 11.8 | 5.5 | 0.3 | 61.5 | |||||||||||||||||||||
Total Loss and ALAE | 10.0 | 18.8 | 17.3 | 11.8 | 6.3 | 0.4 | 64.6 | |||||||||||||||||||||
ULAE | 0.9 | 1.8 | 1.6 | 1.8 | 0.3 | 0.2 | 6.6 | |||||||||||||||||||||
Total Loss and LAE | 10.9 | 20.6 | 18.9 | 13.6 | 6.6 | 0.6 | 71.2 | |||||||||||||||||||||
Underwriting expenses | 8.8 | 12.7 | 12.5 | 7.4 | 5.5 | 2.3 | 49.2 | |||||||||||||||||||||
Net underwriting (loss) gain | $ | (0.9 | ) | $ | (2.8 | ) | $ | (2.8 | ) | $ | 0.3 | $ | (0.8 | ) | $ | 1.8 | $ | (5.2 | ) | |||||||||
Cat loss and ALAE ratio | (1.8 | )% | 6.8 | % | 1.7 | % | — | % | 7.3 | % | 1.7 | % | 2.7 | % | ||||||||||||||
Non-cat loss and ALAE ratio | ||||||||||||||||||||||||||||
Prior accident years non-cat loss and ALAE ratio | (5.9 | )% | (5.8 | )% | (6.7 | )% | (12.0 | )% | (8.2 | )% | (42.7 | )% | (8.9 | )% | ||||||||||||||
Current accident year non-cat loss and ALAE ratio | 60.9 | % | 60.6 | % | 65.3 | % | 67.5 | % | 57.5 | % | 51.0 | % | 62.4 | % | ||||||||||||||
Total non-cat loss and ALAE ratio | 55.0 | % | 54.8 | % | 58.6 | % | 55.5 | % | 49.3 | % | 8.3 | % | 53.5 | % | ||||||||||||||
Total Loss and ALAE ratio | 53.2 | % | 61.6 | % | 60.3 | % | 55.5 | % | 56.6 | % | 10.0 | % | 56.2 | % | ||||||||||||||
ULAE ratio | 5.1 | % | 5.7 | % | 5.4 | % | 8.1 | % | 2.4 | % | 5.5 | % | 5.7 | % | ||||||||||||||
Total Loss and LAE ratio | 58.3 | % | 67.3 | % | 65.7 | % | 63.6 | % | 59.0 | % | 15.5 | % | 61.9 | % | ||||||||||||||
Expense ratio | 46.3 | % | 43.6 | % | 41.7 | % | 30.5 | % | 51.5 | % | 47.3 | % | 41.8 | % | ||||||||||||||
Combined ratio | 104.6 | % | 110.9 | % | 107.5 | % | 94.1 | % | 110.5 | % | 62.8 | % | 103.7 | % | ||||||||||||||
($ in millions) | ||||||||||||||||||||||||||||
Three months ended September 30, 2017 | Commercial Auto | Small Commercial Package | Middle Market Commercial | Workers' Comp | Farm & Ranch | Other Commercial | Total | |||||||||||||||||||||
Net written premiums | $ | 18.6 | $ | 31.4 | $ | 28.8 | $ | 25.1 | $ | 10.1 | $ | 3.3 | $ | 117.3 | ||||||||||||||
Net earned premiums | 18.8 | 33.3 | 26.7 | 22.0 | 10.1 | 3.4 | 114.3 | |||||||||||||||||||||
Losses and LAE incurred: | ||||||||||||||||||||||||||||
Cat loss and ALAE | 0.3 | 2.5 | 0.4 | — | 1.2 | — | 4.4 | |||||||||||||||||||||
Non-cat loss and ALAE | ||||||||||||||||||||||||||||
Prior accident years non-cat loss and ALAE | (2.6 | ) | (2.9 | ) | (0.8 | ) | (2.2 | ) | (0.2 | ) | (1.2 | ) | (9.9 | ) | ||||||||||||||
Current accident year non-cat loss and ALAE | 13.2 | 20.3 | 13.5 | 14.1 | 5.1 | 1.5 | 67.7 | |||||||||||||||||||||
Total non-cat loss and ALAE | 10.6 | 17.4 | 12.7 | 11.9 | 4.9 | 0.3 | 57.8 | |||||||||||||||||||||
Total Loss and ALAE | 10.9 | 19.9 | 13.1 | 11.9 | 6.1 | 0.3 | 62.2 | |||||||||||||||||||||
ULAE | 1.2 | 1.7 | 0.9 | 1.5 | 0.2 | 0.1 | 5.6 | |||||||||||||||||||||
Total Loss and LAE | 12.1 | 21.6 | 14.0 | 13.4 | 6.3 | 0.4 | 67.8 | |||||||||||||||||||||
Underwriting expenses | 7.8 | 14.1 | 10.3 | 7.4 | 3.7 | 1.9 | 45.2 | |||||||||||||||||||||
Net underwriting (loss) gain | $ | (1.1 | ) | $ | (2.4 | ) | $ | 2.4 | $ | 1.2 | $ | 0.1 | $ | 1.1 | $ | 1.3 | ||||||||||||
Cat loss and ALAE ratio | 1.6 | % | 7.6 | % | 1.4 | % | — | % | 11.7 | % | — | % | 3.8 | % | ||||||||||||||
Non-cat loss and ALAE ratio | ||||||||||||||||||||||||||||
Prior accident years non-cat loss and ALAE ratio | (13.6 | )% | (9.0 | )% | (3.0 | )% | (9.6 | )% | (2.7 | )% | (33.4 | )% | (8.6 | )% | ||||||||||||||
Current accident year non-cat loss and ALAE ratio | 70.2 | % | 61.4 | % | 50.4 | % | 63.9 | % | 50.5 | % | 40.2 | % | 59.2 | % | ||||||||||||||
Total non-cat loss and ALAE ratio | 56.6 | % | 52.4 | % | 47.4 | % | 54.3 | % | 47.8 | % | 6.8 | % | 50.6 | % | ||||||||||||||
Total Loss and ALAE ratio | 58.2 | % | 60.0 | % | 48.8 | % | 54.3 | % | 59.5 | % | 6.8 | % | 54.4 | % | ||||||||||||||
ULAE ratio | 5.7 | % | 5.1 | % | 3.3 | % | 6.6 | % | 3.6 | % | 7.8 | % | 5.0 | % | ||||||||||||||
Total Loss and LAE ratio | 63.9 | % | 65.1 | % | 52.1 | % | 60.9 | % | 63.1 | % | 14.6 | % | 59.4 | % | ||||||||||||||
Expense ratio | 42.1 | % | 44.8 | % | 36.0 | % | 29.6 | % | 36.8 | % | 54.4 | % | 38.5 | % | ||||||||||||||
Combined ratio | 106.0 | % | 109.9 | % | 88.1 | % | 90.5 | % | 99.9 | % | 69.0 | % | 97.9 | % | ||||||||||||||
($ in millions) | ||||||||||||||||||||||||||||
Nine months ended September 30, 2018 | Commercial Auto | Small Commercial Package | Middle Market Commercial | Workers' Comp | Farm & Ranch | Other Commercial | Total | |||||||||||||||||||||
Net written premiums | $ | 59.1 | $ | 91.1 | $ | 90.8 | $ | 66.1 | $ | 34.9 | $ | 14.5 | $ | 356.5 | ||||||||||||||
Net earned premiums | 55.9 | 91.2 | 85.0 | 66.7 | 33.4 | 13.5 | 345.7 | |||||||||||||||||||||
Losses and LAE incurred: | ||||||||||||||||||||||||||||
Cat loss and ALAE | 0.2 | 9.8 | 5.8 | — | 2.4 | 0.1 | 18.3 | |||||||||||||||||||||
Non-cat loss and ALAE | ||||||||||||||||||||||||||||
Prior accident years non-cat loss and ALAE | (5.7 | ) | (6.5 | ) | (5.3 | ) | (8.4 | ) | (2.2 | ) | (1.5 | ) | (29.6 | ) | ||||||||||||||
Current accident year non-cat loss and ALAE | 34.9 | 55.3 | 55.9 | 43.3 | 17.1 | 6.0 | 212.5 | |||||||||||||||||||||
Total non-cat loss and ALAE | 29.2 | 48.8 | 50.6 | 34.9 | 14.9 | 4.5 | 182.9 | |||||||||||||||||||||
Total Loss and ALAE | 29.4 | 58.6 | 56.4 | 34.9 | 17.3 | 4.6 | 201.2 | |||||||||||||||||||||
ULAE | 3.2 | 4.8 | 4.6 | 5.6 | 1.3 | 0.8 | 20.3 | |||||||||||||||||||||
Total Loss and LAE | 32.6 | 63.4 | 61.0 | 40.5 | 18.6 | 5.4 | 221.5 | |||||||||||||||||||||
Underwriting expenses | 26.4 | 40.4 | 36.1 | 21.8 | 15.7 | 6.1 | 146.5 | |||||||||||||||||||||
Net underwriting (loss) gain | $ | (3.1 | ) | $ | (12.6 | ) | $ | (12.1 | ) | $ | 4.4 | $ | (0.9 | ) | $ | 2.0 | $ | (22.3 | ) | |||||||||
Cat loss and ALAE ratio | 0.4 | % | 10.8 | % | 6.8 | % | — | % | 7.3 | % | 0.6 | % | 5.3 | % | ||||||||||||||
Non-cat loss and ALAE ratio | ||||||||||||||||||||||||||||
Prior accident years non-cat loss and ALAE ratio | (10.1 | )% | (7.1 | )% | (6.2 | )% | (12.6 | )% | (6.5 | )% | (11.2 | )% | (8.5 | )% | ||||||||||||||
Current accident year non-cat loss and ALAE ratio | 62.4 | % | 60.6 | % | 65.7 | % | 64.9 | % | 51.1 | % | 44.9 | % | 61.5 | % | ||||||||||||||
Total non-cat loss and ALAE ratio | 52.3 | % | 53.5 | % | 59.5 | % | 52.3 | % | 44.6 | % | 33.7 | % | 53.0 | % | ||||||||||||||
Total Loss and ALAE ratio | 52.7 | % | 64.3 | % | 66.3 | % | 52.3 | % | 51.9 | % | 34.3 | % | 58.3 | % | ||||||||||||||
ULAE ratio | 5.8 | % | 5.2 | % | 5.4 | % | 8.4 | % | 3.9 | % | 6.0 | % | 5.9 | % | ||||||||||||||
Total Loss and LAE ratio | 58.5 | % | 69.5 | % | 71.7 | % | 60.7 | % | 55.8 | % | 40.3 | % | 64.2 | % | ||||||||||||||
Expense ratio | 44.7 | % | 44.3 | % | 39.7 | % | 32.9 | % | 45.0 | % | 42.0 | % | 41.1 | % | ||||||||||||||
Combined ratio | 103.2 | % | 113.8 | % | 111.4 | % | 93.6 | % | 100.8 | % | 82.3 | % | 105.3 | % | ||||||||||||||
($ in millions) | ||||||||||||||||||||||||||||
Nine months ended September 30, 2017 | Commercial Auto | Small Commercial Package | Middle Market Commercial | Workers' Comp | Farm & Ranch | Other Commercial | Total | |||||||||||||||||||||
Net written premiums | $ | 56.9 | $ | 93.7 | $ | 85.2 | $ | 66.4 | $ | 31.5 | $ | 10.9 | $ | 344.6 | ||||||||||||||
Net earned premiums | 57.6 | 96.5 | 81.2 | 66.3 | 29.1 | 11.1 | 341.8 | |||||||||||||||||||||
Losses and LAE incurred: | ||||||||||||||||||||||||||||
Cat loss and ALAE | 0.9 | 12.0 | 7.6 | — | 4.9 | — | 25.4 | |||||||||||||||||||||
Non-cat loss and ALAE | ||||||||||||||||||||||||||||
Prior accident years non-cat loss and ALAE | (5.7 | ) | (7.9 | ) | (6.1 | ) | (6.9 | ) | (1.0 | ) | (5.5 | ) | (33.1 | ) | ||||||||||||||
Current accident year non-cat loss and ALAE | 39.7 | 54.9 | 43.9 | 44.5 | 16.2 | 5.4 | 204.6 | |||||||||||||||||||||
Total non-cat loss and ALAE | 34.0 | 47.0 | 37.8 | 37.6 | 15.2 | (0.1 | ) | 171.5 | ||||||||||||||||||||
Total Loss and ALAE | 34.9 | 59.0 | 45.4 | 37.6 | 20.1 | (0.1 | ) | 196.9 | ||||||||||||||||||||
ULAE | 3.3 | 4.3 | 3.5 | 5.1 | 1.6 | 0.6 | 18.4 | |||||||||||||||||||||
Total Loss and LAE | 38.2 | 63.3 | 48.9 | 42.7 | 21.7 | 0.5 | 215.3 | |||||||||||||||||||||
Underwriting expenses | 23.4 | 40.9 | 31.0 | 21.0 | 11.5 | 5.7 | 133.5 | |||||||||||||||||||||
Net underwriting (loss) gain | $ | (4.0 | ) | $ | (7.7 | ) | $ | 1.3 | $ | 2.6 | $ | (4.1 | ) | $ | 4.9 | $ | (7.0 | ) | ||||||||||
Cat loss and ALAE ratio | 1.6 | % | 12.4 | % | 9.3 | % | — | % | 16.9 | % | 0.1 | % | 7.4 | % | ||||||||||||||
Non-cat loss and ALAE ratio | ||||||||||||||||||||||||||||
Prior accident years non-cat loss and ALAE ratio | (9.8 | )% | (8.2 | )% | (7.6 | )% | (10.3 | )% | (3.6 | )% | (48.9 | )% | (9.7 | )% | ||||||||||||||
Current accident year non-cat loss and ALAE ratio | 68.8 | % | 57.0 | % | 54.2 | % | 67.1 | % | 55.7 | % | 47.9 | % | 59.9 | % | ||||||||||||||
Total non-cat loss and ALAE ratio | 59.0 | % | 48.8 | % | 46.6 | % | 56.8 | % | 52.1 | % | (1.0 | )% | 50.2 | % | ||||||||||||||
Total Loss and ALAE ratio | 60.6 | % | 61.2 | % | 55.9 | % | 56.8 | % | 69.0 | % | (0.9 | )% | 57.6 | % | ||||||||||||||
ULAE ratio | 5.6 | % | 4.4 | % | 4.3 | % | 7.6 | % | 5.7 | % | 5.6 | % | 5.4 | % | ||||||||||||||
Total Loss and LAE ratio | 66.2 | % | 65.6 | % | 60.2 | % | 64.4 | % | 74.7 | % | 4.7 | % | 63.0 | % | ||||||||||||||
Expense ratio | 41.1 | % | 43.6 | % | 36.4 | % | 31.6 | % | 36.5 | % | 52.2 | % | 38.7 | % | ||||||||||||||
Combined ratio | 107.3 | % | 109.2 | % | 96.6 | % | 96.0 | % | 111.2 | % | 56.9 | % | 101.7 | % | ||||||||||||||
SAP Personal & Commercial Insurance Segment Results | ||||||||||||||||
($ in millions) | ||||||||||||||||
(unaudited) | ||||||||||||||||
3Q 2018 | 3Q 2017 | YTD 2018 | YTD 20172 | |||||||||||||
Net written premiums | $ | 312.9 | $ | 282.8 | $ | 898.4 | $ | 792.6 | ||||||||
Net earned premiums | 288.2 | 258.4 | 839.9 | 772.4 | ||||||||||||
Losses and LAE incurred: | ||||||||||||||||
Cat loss and ALAE | 15.9 | 12.4 | 63.4 | 69.1 | ||||||||||||
Non-cat loss and ALAE | ||||||||||||||||
Prior accident years non-cat loss and ALAE | (19.9 | ) | (10.0 | ) | (56.4 | ) | (31.0 | ) | ||||||||
Current accident year non-cat loss and ALAE | 163.7 | 153.1 | 496.0 | 459.8 | ||||||||||||
Total non-cat loss and ALAE | 143.8 | 143.1 | 439.6 | 428.8 | ||||||||||||
Total Loss and ALAE | 159.7 | 155.5 | 503.0 | 497.9 | ||||||||||||
ULAE | 17.3 | 14.5 | 51.0 | 46.4 | ||||||||||||
Total Loss and LAE | 177.0 | 170.0 | 554.0 | 544.3 | ||||||||||||
Underwriting expenses | 109.5 | 94.5 | 312.8 | 266.5 | ||||||||||||
Net underwriting gain (loss) | $ | 1.7 | $ | (6.1 | ) | $ | (26.9 | ) | $ | (38.7 | ) | |||||
Cat loss and ALAE ratio | 5.5 | % | 4.8 | % | 7.6 | % | 8.9 | % | ||||||||
Non-cat loss and ALAE ratio | ||||||||||||||||
Prior accident years non-cat loss and ALAE ratio | (6.9 | )% | (3.9 | )% | (6.7 | )% | (4.0 | )% | ||||||||
Current accident year non-cat loss and ALAE ratio | 56.8 | % | 59.3 | % | 59.0 | % | 59.5 | % | ||||||||
Total non-cat loss and ALAE ratio | 49.9 | % | 55.4 | % | 52.3 | % | 55.5 | % | ||||||||
Total Loss and ALAE ratio | 55.4 | % | 60.2 | % | 59.9 | % | 64.4 | % | ||||||||
ULAE ratio | 6.0 | % | 5.6 | % | 6.1 | % | 6.0 | % | ||||||||
Total Loss and LAE ratio | 61.4 | % | 65.8 | % | 66.0 | % | 70.4 | % | ||||||||
Expense ratio | 35.0 | % | 33.4 | % | 34.8 | % | 33.6 | % | ||||||||
Combined ratio | 96.4 | % | 99.2 | % | 100.8 | % | 104.0 | % | ||||||||
SAP Specialty Insurance Segment Results | ||||||||||||||||
(unaudited) | ||||||||||||||||
($ in millions) | ||||||||||||||||
Three months ended September 30, 2018 | E&S Property | E&S Casualty | Programs | Total | ||||||||||||
Net written premiums | $ | (0.2 | ) | $ | (0.3 | ) | $ | — | $ | (0.5 | ) | |||||
Net earned premiums | 1.5 | 15.2 | 1.9 | 18.6 | ||||||||||||
Losses and LAE incurred: | ||||||||||||||||
Cat loss and ALAE | 0.4 | — | — | 0.4 | ||||||||||||
Non-cat loss and ALAE | ||||||||||||||||
Prior accident years non-cat loss and ALAE | (0.5 | ) | 0.6 | 1.7 | 1.8 | |||||||||||
Current accident year non-cat loss and ALAE | 0.6 | 10.1 | 0.7 | 11.4 | ||||||||||||
Total non-cat loss and ALAE | 0.1 | 10.7 | 2.4 | 13.2 | ||||||||||||
Total Loss and ALAE | 0.5 | 10.7 | 2.4 | 13.6 | ||||||||||||
ULAE | 0.1 | 0.5 | 0.2 | 0.8 | ||||||||||||
Total Loss and LAE | 0.6 | 11.2 | 2.6 | 14.4 | ||||||||||||
Underwriting expenses | 0.4 | 1.5 | 0.4 | 2.3 | ||||||||||||
Net underwriting gain (loss) | $ | 0.5 | $ | 2.5 | $ | (1.1 | ) | $ | 1.9 | |||||||
Cat loss and ALAE ratio | 27.9 | % | — | % | (0.6 | )% | 2.2 | % | ||||||||
Non-cat loss and ALAE ratio | ||||||||||||||||
Prior accident years non-cat loss and ALAE ratio | (27.5 | )% | 3.6 | % | 85.7 | % | 9.4 | % | ||||||||
Current accident year non-cat loss and ALAE ratio | 37.3 | % | 66.7 | % | 44.8 | % | 62.1 | % | ||||||||
Total non-cat loss and ALAE ratio | 9.8 | % | 70.3 | % | 130.5 | % | 71.5 | % | ||||||||
Total Loss and ALAE ratio | 37.7 | % | 70.3 | % | 129.9 | % | 73.7 | % | ||||||||
ULAE ratio | 4.0 | % | 3.1 | % | 10.6 | % | 3.9 | % | ||||||||
Total Loss and LAE ratio | 41.7 | % | 73.4 | % | 140.5 | % | 77.6 | % | ||||||||
Expense ratio | (163.8 | )% | (557.0 | )% | (3,302.4 | )% | (439.2 | )% | ||||||||
Combined ratio | (122.1 | )% | (483.6 | )% | (3,161.9 | )% | (361.6 | )% |
($ in millions) | ||||||||||||||||
Three months ended September 30, 2017 | E&S Property | E&S Casualty | Programs | Total | ||||||||||||
Net written premiums | $ | 4.9 | $ | 26.3 | $ | 7.3 | $ | 38.5 | ||||||||
Net earned premiums | 10.0 | 27.0 | 23.6 | 60.6 | ||||||||||||
Losses and LAE incurred: | ||||||||||||||||
Cat loss and ALAE | 42.9 | 0.3 | 0.5 | 43.7 | ||||||||||||
Non-cat loss and ALAE | ||||||||||||||||
Prior accident years non-cat loss and ALAE | 1.4 | (0.8 | ) | 0.6 | 1.2 | |||||||||||
Current accident year non-cat loss and ALAE | 2.6 | 18.1 | 16.5 | 37.2 | ||||||||||||
Total non-cat loss and ALAE | 4.0 | 17.3 | 17.1 | 38.4 | ||||||||||||
Total Loss and ALAE | 46.9 | 17.6 | 17.6 | 82.1 | ||||||||||||
ULAE | — | 0.7 | 1.2 | 1.9 | ||||||||||||
Total Loss and LAE | 46.9 | 18.3 | 18.8 | 84.0 | ||||||||||||
Underwriting expenses | 3.7 | 9.4 | 2.6 | 15.7 | ||||||||||||
Net underwriting (loss) gain | $ | (40.6 | ) | $ | (0.7 | ) | $ | 2.2 | $ | (39.1 | ) | |||||
Cat loss and ALAE ratio | 430.9 | % | 1.2 | % | 2.1 | % | 72.2 | % | ||||||||
Non-cat loss and ALAE ratio | ||||||||||||||||
Prior accident years non-cat loss and ALAE ratio | 13.6 | % | (3.0 | )% | 2.1 | % | 1.7 | % | ||||||||
Current accident year non-cat loss and ALAE ratio | 25.0 | % | 66.9 | % | 70.7 | % | 61.5 | % | ||||||||
Total non-cat loss and ALAE ratio | 38.6 | % | 63.9 | % | 72.8 | % | 63.2 | % | ||||||||
Total Loss and ALAE ratio | 469.5 | % | 65.1 | % | 74.9 | % | 135.4 | % | ||||||||
ULAE ratio | 1.0 | % | 2.5 | % | 4.9 | % | 3.2 | % | ||||||||
Total Loss and LAE ratio | 470.5 | % | 67.6 | % | 79.8 | % | 138.6 | % | ||||||||
Expense ratio | 75.1 | % | 35.8 | % | 35.5 | % | 40.8 | % | ||||||||
Combined ratio | 545.6 | % | 103.4 | % | 115.3 | % | 179.4 | % |
($ in millions) | ||||||||||||||||
Nine months ended September 30, 2018 | E&S Property | E&S Casualty | Programs | Total | ||||||||||||
Net written premiums | $ | (5.5 | ) | $ | 20.7 | $ | (0.9 | ) | $ | 14.3 | ||||||
Net earned premiums | 9.8 | 60.2 | 19.3 | 89.3 | ||||||||||||
Losses and LAE incurred: | ||||||||||||||||
Cat loss and ALAE | 0.5 | — | (0.3 | ) | 0.2 | |||||||||||
Non-cat loss and ALAE | ||||||||||||||||
Prior accident years non-cat loss and ALAE | (0.1 | ) | 3.4 | 0.9 | 4.2 | |||||||||||
Current accident year non-cat loss and ALAE | 3.3 | 42.5 | 13.6 | 59.4 | ||||||||||||
Total non-cat loss and ALAE | 3.2 | 45.9 | 14.5 | 63.6 | ||||||||||||
Total Loss and ALAE | 3.7 | 45.9 | 14.2 | 63.8 | ||||||||||||
ULAE | 0.2 | 2.5 | 1.8 | 4.5 | ||||||||||||
Total Loss and LAE | 3.9 | 48.4 | 16.0 | 68.3 | ||||||||||||
Underwriting expenses | 3.3 | 11.1 | 2.1 | 16.5 | ||||||||||||
Net underwriting gain | $ | 2.6 | $ | 0.7 | $ | 1.2 | $ | 4.5 | ||||||||
Cat loss and ALAE ratio | 4.8 | % | — | % | (1.4 | )% | 0.2 | % | ||||||||
Non-cat loss and ALAE ratio | ||||||||||||||||
Prior accident years non-cat loss and ALAE ratio | (0.8 | )% | 5.6 | % | 4.4 | % | 4.6 | % | ||||||||
Current accident year non-cat loss and ALAE ratio | 33.5 | % | 70.7 | % | 71.0 | % | 66.6 | % | ||||||||
Total non-cat loss and ALAE ratio | 32.7 | % | 76.3 | % | 75.4 | % | 71.2 | % | ||||||||
Total Loss and ALAE ratio | 37.5 | % | 76.3 | % | 74.0 | % | 71.4 | % | ||||||||
ULAE ratio | 2.0 | % | 4.0 | % | 9.4 | % | 5.0 | % | ||||||||
Total Loss and LAE ratio | 39.5 | % | 80.3 | % | 83.4 | % | 76.4 | % | ||||||||
Expense ratio | (59.2 | )% | 54.2 | % | (249.4 | )% | 115.9 | % | ||||||||
Combined ratio | (19.7 | )% | 134.5 | % | (166.0 | )% | 192.3 | % |
($ in millions) | ||||||||||||||||
Nine months ended September 30, 2017 | E&S Property2 | E&S Casualty | Programs2 | Total2 | ||||||||||||
Net written premiums | $ | 31.4 | $ | 83.6 | $ | 61.9 | $ | 176.9 | ||||||||
Net earned premiums | 31.4 | 76.1 | 77.3 | 184.8 | ||||||||||||
Losses and LAE incurred: | ||||||||||||||||
Cat loss and ALAE | 45.3 | 0.3 | 1.0 | 46.6 | ||||||||||||
Non-cat loss and ALAE | ||||||||||||||||
Prior accident years non-cat loss and ALAE | 3.0 | (1.1 | ) | 0.7 | 2.6 | |||||||||||
Current accident year non-cat loss and ALAE | 8.4 | 53.4 | 57.2 | 119.0 | ||||||||||||
Total non-cat loss and ALAE | 11.4 | 52.3 | 57.9 | 121.6 | ||||||||||||
Total Loss and ALAE | 56.7 | 52.6 | 58.9 | 168.2 | ||||||||||||
ULAE | (0.2 | ) | 2.9 | 4.2 | 6.9 | |||||||||||
Total Loss and LAE | 56.5 | 55.5 | 63.1 | 175.1 | ||||||||||||
Underwriting expenses | 14.7 | 29.5 | 17.6 | 61.8 | ||||||||||||
Net underwriting loss | $ | (39.8 | ) | $ | (8.9 | ) | $ | (3.4 | ) | $ | (52.1 | ) | ||||
Cat loss and ALAE ratio | 144.4 | % | 0.4 | % | 1.2 | % | 25.2 | % | ||||||||
Non-cat loss and ALAE ratio | ||||||||||||||||
Prior accident years non-cat loss and ALAE ratio | 9.6 | % | (1.4 | )% | 0.8 | % | 1.4 | % | ||||||||
Current accident year non-cat loss and ALAE ratio | 26.6 | % | 70.0 | % | 74.2 | % | 64.4 | % | ||||||||
Total non-cat loss and ALAE ratio | 36.2 | % | 68.6 | % | 75.0 | % | 65.8 | % | ||||||||
Total Loss and ALAE ratio | 180.6 | % | 69.0 | % | 76.2 | % | 91.0 | % | ||||||||
ULAE ratio | (0.5 | )% | 3.9 | % | 5.4 | % | 3.7 | % | ||||||||
Total Loss and LAE ratio | 180.1 | % | 72.9 | % | 81.6 | % | 94.7 | % | ||||||||
Expense ratio | 47.1 | % | 35.2 | % | 28.4 | % | 35.0 | % | ||||||||
Combined ratio | 227.2 | % | 108.1 | % | 110.0 | % | 129.7 | % | ||||||||
SAP Insurance Segment Results | ||||||||||||||||
($ in millions) | ||||||||||||||||
(unaudited) | 3Q 2018 | 3Q 2017 | YTD 2018 | YTD 20172 | ||||||||||||
Net written premiums | $ | 312.4 | $ | 321.3 | $ | 912.7 | $ | 969.4 | ||||||||
Net earned premiums | 306.8 | 319.0 | 929.2 | 957.2 | ||||||||||||
Losses and LAE incurred: | ||||||||||||||||
Cat loss and ALAE | 16.3 | 56.1 | 63.6 | 115.7 | ||||||||||||
Non-cat loss and ALAE | ||||||||||||||||
Prior accident years non-cat loss and ALAE | (18.1 | ) | (8.8 | ) | (52.2 | ) | (28.4 | ) | ||||||||
Current accident year non-cat loss and ALAE | 175.1 | 190.3 | 555.4 | 578.8 | ||||||||||||
Total non-cat loss and ALAE | 157.0 | 181.5 | 503.2 | 550.4 | ||||||||||||
Total Loss and ALAE | 173.3 | 237.6 | 566.8 | 666.1 | ||||||||||||
ULAE | 18.1 | 16.4 | 55.5 | 53.3 | ||||||||||||
Total Loss and LAE | 191.4 | 254.0 | 622.3 | 719.4 | ||||||||||||
Underwriting expenses | 111.8 | 110.2 | 329.3 | 328.3 | ||||||||||||
Net underwriting gain (loss) | $ | 3.6 | $ | (45.2 | ) | $ | (22.4 | ) | $ | (90.5 | ) | |||||
Cat loss and ALAE ratio | 5.3 | % | 17.6 | % | 6.8 | % | 12.1 | % | ||||||||
Non-cat loss and ALAE ratio | ||||||||||||||||
Prior accident years non-cat loss and ALAE ratio | (5.9 | )% | (2.8 | )% | (5.6 | )% | (3.0 | )% | ||||||||
Current accident year non-cat loss and ALAE ratio | 57.1 | % | 59.7 | % | 59.8 | % | 60.5 | % | ||||||||
Total non-cat loss and ALAE ratio | 51.2 | % | 56.9 | % | 54.2 | % | 57.5 | % | ||||||||
Total Loss and ALAE ratio | 56.5 | % | 74.5 | % | 61.0 | % | 69.6 | % | ||||||||
ULAE ratio | 5.9 | % | 5.1 | % | 6.0 | % | 5.6 | % | ||||||||
Total Loss and LAE ratio | 62.4 | % | 79.6 | % | 67.0 | % | 75.2 | % | ||||||||
Expense ratio | 35.8 | % | 34.3 | % | 36.1 | % | 33.9 | % | ||||||||
Combined ratio | 98.2 | % | 113.9 | % | 103.1 | % | 109.1 | % | ||||||||
($ millions) | 3Q 2018 | 3Q 2017 | YTD 2018 | YTD 20172 | |||||||||||
Segment income before federal income taxes: | |||||||||||||||
Insurance segments: | |||||||||||||||
Personal insurance SAP underwriting gain (loss) | $ | 6.9 | $ | (7.4 | ) | $ | (4.6 | ) | $ | (31.4 | ) | ||||
Commercial insurance SAP underwriting (loss) gain | (5.2 | ) | 1.3 | (22.3 | ) | (7.0 | ) | ||||||||
Specialty insurance SAP underwriting gain (loss) | 1.9 | (39.1 | ) | 4.5 | (52.1 | ) | |||||||||
Total insurance segments | 3.6 | (45.2 | ) | (22.4 | ) | (90.5 | ) | ||||||||
Investment operations segment: | |||||||||||||||
Net investment income | 20.8 | 18.7 | 62.2 | 56.5 | |||||||||||
Net investment gain | 17.8 | 20.2 | 18.2 | 43.8 | |||||||||||
Total investment operations segment | 38.6 | 38.9 | 80.4 | 100.3 | |||||||||||
All other segments income | 0.1 | 0.1 | 0.3 | 0.2 | |||||||||||
Reconciling items: | |||||||||||||||
GAAP adjustments | 0.8 | (2.8 | ) | (2.6 | ) | (6.3 | ) | ||||||||
Interest expense on corporate debt | (1.2 | ) | (1.5 | ) | (4.5 | ) | (4.4 | ) | |||||||
Corporate expenses | (0.9 | ) | (0.7 | ) | (5.8 | ) | (2.6 | ) | |||||||
Total reconciling items | (1.3 | ) | (5.0 | ) | (12.9 | ) | (13.3 | ) | |||||||
Total consolidated income (loss) before federal income taxes | $ | 41.0 | $ | (11.2 | ) | $ | 45.4 | $ | (3.3 | ) | |||||
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