The National Security Group, Inc. Releases Estimates of Spring Storm Losses
April 21 2017 - 3:00PM
Business Wire
The National Security Group, Inc. (NASDAQ:NSEC) released
estimates of 2017 year to date spring storm losses incurred by
property and casualty subsidiary National Security Fire &
Casualty and a preliminary estimate of the impact of storm losses
on first quarter results.
Our property and casualty segment can be impacted by severe
storm activity resulting in incurred losses and loss adjustment
expenses primarily from tornado, wind and hail related damage.
These storm systems or other natural disasters are classified as
catastrophes (referred to as "cat events" or "catastrophe events"
throughout the remainder of this document) by Property Claim
Service (PCS) when these events cause $25 million or more in
industry wide direct incurred losses and affect a significant
number of policyholders.
During the first quarter of 2017, National Security Fire &
Casualty Company (NSFC) was impacted by eight catastrophe events
which produced 731 claims with reported losses (including loss
adjustment expenses) totaling $3,521,000. In comparison, NSFC was
impacted by seven catastrophe events during the first quarter of
2016 leading to 385 claims totaling $1,447,000. The $2,074,000
increase in first quarter 2017 catastrophe losses compared to last
year will adversely impact our first quarter financial results.
While an active spring storm season is not unusual, higher than
normal temperatures in January of 2017 led to an early start to the
traditional "spring storm season" which usually leads to increases
in storm activity in March, April and May. According to
weather.com, January's tornado outbreak was the third largest
outbreak during the winter months on record and caused extensive
damage in the Southeastern U.S., primarily in the state of Georgia.
While the claims incurred from 2017 cat events were widespread
across our coverage area, incurred losses from these cat events
heavily impacted Georgia, Alabama and Mississippi. Incurred losses
from cat events impacting Georgia made up approximately 50% of all
losses incurred from cat events in the first quarter of 2017.
Furthermore, incurred losses from cat events impacting Alabama and
Mississippi made up an additional 37% of all claims incurred from
cat events in the first quarter of 2017.
The unusually warm weather in the Southeastern U.S. led to an
increase in both frequency and severity of storm related losses
throughout the first quarter. The 731 catastrophe related claims
incurred during the first quarter of 2017 averaged approximately
$4,800 per claim; in comparison, the 385 catastrophe related claims
in the first quarter of last year averaged approximately $3,800 per
claim.
Due to the negative impact of the cat losses, we expect to end
the first quarter of 2017 with a consolidated net loss in the range
of $300,000 to $450,000. We are scheduled to release first quarter
financial results on May 12, 2017.
In addition to the negative impact catastrophe events had on
first quarter of 2017 results, we are also disclosing the following
forward looking information.
During the first week of April 2017, NSFC was impacted by two
additional cat events. As of April 20, 2017, we have incurred 260
claims from these cat events totaling $1,013,000. While we are very
early in the second quarter and mostly milder weather had prevailed
over the past two weeks, these early catastrophe losses will reduce
second quarter net income by approximately $669,000.
The National Security Group, Inc. (NASDAQ Symbol: NSEC), through
its property and casualty and life insurance subsidiaries, offers
property, casualty, life, accident and health insurance in ten
states. The Company writes primarily personal lines property
coverage including dwelling fire and windstorm, homeowners and
mobile homeowners lines of insurance. The Company also offers life,
accident and health, supplemental hospital and cancer insurance
products. The Company was founded in 1947 and is based in Elba,
Alabama. Additional information about the Company, including
additional details of recent financial results, can be found on our
website: www.nationalsecuritygroup.com.
Information about forward-looking statementsAny statement
contained in this report which is not a historical fact, or which
might otherwise be considered an opinion or projection concerning
the Company or its business, whether expressed or implied, is meant
as and should be considered a forward-looking statement as that
term is defined in the Private Securities Litigation Reform Act of
1995. Forward-looking statements are based on assumptions and
opinions concerning a variety of known and unknown risks, including
but not limited to changes in market conditions, natural disasters
and other catastrophic events, increased competition, changes in
availability and cost of reinsurance, changes in governmental
regulations, technological changes, political and legal
contingencies and general economic conditions, as well as other
risks and uncertainties more completely described in the Company’s
filings with the Securities and Exchange Commission. If any of
these assumptions or opinions proves incorrect, any forward-looking
statements made on the basis of such assumptions or opinions may
also prove materially incorrect in one or more respects and may
cause future results to differ materially from those contemplated,
projected, estimated or budgeted in such forward-looking
statements.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170421005689/en/
The National Security Group, Inc.Brian McLeod, 334-897-2273Chief
Financial Officer
National Security (NASDAQ:NSEC)
Historical Stock Chart
From Jun 2024 to Jul 2024
National Security (NASDAQ:NSEC)
Historical Stock Chart
From Jul 2023 to Jul 2024