- Quarterly income of $0.26 per share
- Quarterly net loss from operations1 of $0.10 per share
- Quarterly GAAP combined ratio of 106.0
- Quarterly SAP personal and commercial segments' combined ratio2
of 102.2
- Return on equity of (3.8)%
- Book value per share of $21.57
State Auto Financial Corporation (NASDAQ:STFC) today reported
third quarter 2020 net income of $11.6 million, or $0.26 per
diluted share, compared to $11.5 million, or $0.25 per diluted
share, for the same 2019 period. Net loss from operations1 per
diluted share for the third quarter of 2020 was $0.10 versus net
income from operations1 per diluted share of $0.34 for the same
2019 period.
For the first nine months of 2020, STFC had a net loss of $68.7
million, or $1.57 per diluted share, compared to net income of
$54.7 million, or $1.25 per diluted share, for the same 2019
period. Net loss from operations1 per diluted share for the first
nine months of 2020 was $0.86 versus net income from operations1
per diluted share of $0.34 for the same 2019 period.
GAAP Operating Results
STFC’s GAAP combined ratio for the third quarter 2020 was 106.0
compared to 99.5 for the same 2019 period. Catastrophe losses and
ALAE during the third quarter 2020 accounted for 16.6 points of the
71.2 total loss ratio points, or $58.7 million, versus 3.3 points
of the 65.2 total loss ratio points, or $10.6 million, for the same
period in 2019. The third quarter 2020 was impacted by severe wind
and hail events that impacted the South and Midwest, with
approximately 50% of the catastrophe losses affecting our
homeowners line of business. Catastrophe losses and ALAE included
3.5 points of adverse development relating to prior years, or $12.3
million, from specialty run-off related to Hurricane Irma.
Non-catastrophe losses and ALAE during the third quarter 2020
included 5.5 points of favorable development relating to prior
years, or $19.3 million, versus 5.1 points of favorable
development, or $16.1 million, for the same period in 2019.
STFC’s GAAP combined ratio for the first nine months of 2020 was
109.3 compared to 103.6 for the same 2019 period. Catastrophe
losses and ALAE for the first nine months of 2020 accounted for
18.6 points of the 74.4 total loss ratio points, or $191.0 million,
versus 8.1 points of the total 68.6 loss ratio points, or $75.7
million, for the same period in 2019. Catastrophe losses and ALAE
included 1.2 points of adverse development relating to prior years,
or $12.4 million, from specialty run-off related to Hurricane Irma.
Non-catastrophe losses and ALAE for the first nine months of 2020
included 3.1 points of favorable development relating to prior
years, or $31.8 million, versus 5.8 points of favorable
development, or $54.1 million, for the same period in 2019.
Non-catastrophe losses and ALAE for the first nine months of 2020
included 0.5 points of adverse development relating to prior years,
or $5.2 million, versus 0.2 points of favorable development, or
$2.4 million, for the same period in 2019 from specialty
run-off.
SAP Personal and Commercial Operating
Results
Net written premium for the third quarter 2020 increased 9.2%
compared to the same period in 2019. By insurance segment, net
written premium for the personal and commercial segments increased
9.7% and 8.3%, respectively. The increase in the personal segment
was primarily due to new business growth and rate increases in
homeowners and other personal. The improvement was partially offset
by a decrease in net written premiums in personal auto due to a
decline in new business. The increase in the commercial segment was
primarily driven by (i) new business growth and rate increases in
commercial auto, and (ii) new business growth in farm & ranch.
The improvement was partially offset by a decrease in net written
premiums in workers’ compensation due to (i) a decline in new
business as a result of COVID-19, and (ii) continued intense
competition in this market.
Net written premium for the first nine months of 2020 increased
11.3% compared to the same period in 2019. Net written premium for
the personal and commercial segments increased 10.1% and 13.4%,
respectively. The trends in the personal and commercial net written
premiums are due to the same factors discussed above for the third
quarter. In addition, the increase in the commercial segment was
also driven by rate increases in middle market commercial.
The SAP personal and commercial segments' combined ratio2 for
the third quarter 2020 was 102.2 compared to 98.7 for the same 2019
period. Catastrophe losses during the third quarter 2020 accounted
for 13.1 points of the 68.5 total loss ratio points, or $46.4
million, versus 3.2 points of the 65.4 total loss ratio points, or
$10.3 million, for the same period in 2019. Non-catastrophe losses
and ALAE during the third quarter 2020 included 5.2 points of
favorable development relating to prior years, or $18.4 million,
versus 4.8 points of favorable development, or $15.2 million, for
the same period in 2019.
The SAP personal and commercial segments' combined ratio for the
first nine months of 2020 was 106.9 compared to 102.7 for the same
2019 period. Catastrophe losses during the first nine months of
2020 accounted for 17.4 points of the total 72.9 loss ratio points,
or $178.6 million, versus 7.8 of the total 68.5 loss ratio points,
or $71.7 million, for the same period in 2019. Non-catastrophe
losses and ALAE during the first nine months of 2020 included 3.6
points of favorable development relating to prior years, or $37.0
million, versus 5.6 points of favorable development, or $51.7
million, for the same period in 2019.
Book Value and Return on Equity
STFC’s book value increased to $21.57 per share as of September
30, 2020, compared to $21.26 on June 30, 2020. The increase in book
value was driven by investment results.
Return on stockholders’ equity for the 12 months ended September
30, 2020, was (3.8)% compared to 3.4% for the 12 months ended
September 30, 2019.
STFC’s Chairman, President and CEO Mike LaRocco commented on the
quarter as follows:
"While catastrophes had a significant impact on our third
quarter 2020 results, we continue to feel very good about our
continued progress toward consistent profitability and growth. Our
digital transformation continued, with ongoing improvements to our
State Auto Connect technology, including last month’s launch of our
15th and final product, workers’ compensation, on the platform. In
five years we were able to transform all of our products onto an
industry leading digital platform, a monumental achievement.
"I’m proud of the work of our Claims and Risk Engineering (CARE)
professionals and customer service teams who continued to support
our policyholders through some of the most difficult times in their
lives. From the ongoing COVID-19 pandemic to civil unrest and
severe weather, our CARE and Customer Service professionals once
again delivered exceptional service.
"The SAP personal and commercial segments produced 9.2% net
written premium growth during the third quarter, with a combined
ratio of 102.2 that included 13.1 points of catastrophe losses.
Personal lines produced 9.7% net written premium growth and a
combined ratio of 111.5, including 15.8 points of catastrophe
losses. Commercial lines’ 88.9 combined ratio included 9.3 points
of catastrophe losses, and produced 8.3% net written premium
growth.
"Due to catastrophic weather, our third quarter results fell
short of expectations, but the passion and determination that
fueled our turnaround still delivered an excellent quarter and will
drive us toward growth and profitability in the quarters
ahead."
About State Auto Financial Corporation
State Auto Financial Corporation, headquartered in Columbus,
Ohio, is a super regional property and casualty insurance holding
company. STFC stock is traded on the Nasdaq Global Select Market,
which represents the top fourth of all Nasdaq listed companies.
The insurance subsidiaries of State Auto Financial Corporation
are part of the State Auto Group. The State Auto Group markets its
insurance products throughout the United States, through
independent insurance agencies. The State Auto Group is rated A-
(Excellent) by the A.M. Best Company and includes State Automobile
Mutual, State Auto Property & Casualty, State Auto Ohio, State
Auto Wisconsin, Milbank, Meridian Security, Patrons Mutual,
Rockhill Insurance, Plaza Insurance, American Compensation and
Bloomington Compensation. Additional information on State Auto
Financial Corporation and the State Auto Insurance Companies can be
found online at http://www.StateAuto.com/STFC.
STFC has scheduled a conference call with interested investors
for Thursday, November 5, at 11 a.m. ET to discuss the Company’s
third quarter 2020 performance. Live and archived broadcasts of the
call can be accessed at http://www.StateAuto.com/STFC. A replay of
the call can be heard beginning at 2 p.m., November 5, by calling
855-859-2056, conference ID 6944689. Supplemental schedules
detailing the Company’s third quarter 2020 financial, sales and
underwriting results are made available on
http://www.StateAuto.com/STFC prior to the conference call.
1 Net earnings (loss) from operations, a non-GAAP financial
measure which management believes is informative to Company
management and investors, differs from GAAP net income (loss) only
by the exclusion of net investment gain (loss), net of applicable
taxes, on investment activity for the periods being reported. For
STFC, this amounted to income of $0.36 per diluted share for the
third quarter of 2020 and a loss of $0.71 year to date 2020 versus
loss of $0.09 per diluted share for the third quarter 2019 and
income of $0.91 year to date 2019.
2 Insurance industry regulators require STFC's insurance
subsidiaries to report their financial condition and results of
operations using Statutory Accounting Practices ("SAP"). The SAP
personal and commercial segments' combined ratio is a measure used
by management to evaluate STFC’s operating performance for its
ongoing operations. Details behind the compilation of these results
can be found in the SAP Commercial Insurance Segment Results of
this release.
* * * * *
Except for historical information, all other information in this
news release consists of forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements are subject to risks and
uncertainties that could cause actual results to differ materially
from those projected, anticipated or implied. The most significant
of these uncertainties are described in State Auto Financial's Form
10-K and Form 10-Q reports and exhibits to those reports, and
include (but are not limited to) legislative changes at both the
state and federal level, state and federal regulatory rule making
promulgations and adjudications, class action litigation involving
the insurance industry and judicial decisions affecting claims,
policy coverages and the general costs of doing business, the
impact of competition on products and pricing, inflation in the
costs of the products and services insurance pays for, product
development, geographic spread of risk, weather and weather-related
events, and other types of catastrophic events. State Auto
Financial undertakes no obligation to update or revise any
forward-looking statements.
Selected Consolidated Financial
Data
($ in millions, except per share
amounts)
(unaudited)
Three months ended September
30
Nine months ended September
30
2020
2019
2020
2019
Net premiums written
$
379.1
$
346.8
$
1,107.2
$
994.5
Earned premiums
353.2
319.6
1,024.4
930.0
Net investment income
17.9
19.3
54.5
60.4
Net investment gain (loss)
20.0
(5.0
)
(39.3
)
50.2
Other income
0.5
0.6
1.6
1.6
Total revenue
391.6
334.5
1,041.2
1,042.2
Income (loss) before federal income
taxes
14.8
12.7
(87.6
)
66.7
Federal tax expense (benefit)
3.2
1.2
(18.9
)
12.0
Net income (loss)
$
11.6
$
11.5
$
(68.7
)
$
54.7
Earnings (loss) per common share:
- basic
$
0.26
$
0.26
$
(1.57
)
$
1.26
- diluted
$
0.26
$
0.25
$
(1.57
)
$
1.25
(Loss) earnings per share from
operations(A):
- basic
$
(0.10
)
$
0.35
$
(0.86
)
$
0.35
- diluted
$
(0.10
)
$
0.34
$
(0.86
)
$
0.34
Weighted average shares outstanding:
- basic
43.8
43.5
43.7
43.4
- diluted
44.3
44.0
43.7
44.0
Return on average equity (LTM)
(3.8
)%
3.4
%
Book value per share
$
21.57
$
21.68
Dividends paid per share
$
0.10
$
0.10
$
0.30
$
0.30
Total shares outstanding
43.8
43.5
GAAP ratios:
Cat loss and ALAE ratio
16.6
3.3
18.6
8.1
Non-cat loss and LAE ratio
54.6
61.9
55.8
60.5
Loss and LAE ratio
71.2
65.2
74.4
68.6
Expense ratio
34.8
34.3
34.9
35.0
Combined ratio
106.0
99.5
109.3
103.6
(A) Reconciliation of non-GAAP financial
measure:
Net (loss) income from operations:
Net income (loss)
$
11.6
$
11.5
$
(68.7
)
$
54.7
Net investment gain (loss), net of tax
15.8
(3.5
)
(31.0
)
39.6
Net (loss) income from operations
$
(4.2
)
$
15.0
$
(37.7
)
$
15.1
Condensed Consolidated Balance
Sheets
($ and shares in millions, except per
share amounts)
(unaudited)
September 30
December 31
2020
2019
ASSETS
Fixed maturities, available-for-sale, at
fair value (amortized cost $2,047.1 and $2,080.0, respectively)
$
2,166.3
$
2,127.9
Equity securities
339.5
395.2
Other invested assets
62.5
69.7
Other invested assets, at cost
12.5
6.5
Notes receivable from affiliate
70.0
70.0
Total investments
2,650.8
2,669.3
Cash and cash equivalents
131.4
78.0
Accrued investment income and other
assets
31.1
31.7
Premiums Receivable
14.1
13.6
Deferred policy acquisition costs
123.7
111.1
Reinsurance recoverable on losses and loss
expenses payable
35.2
13.6
Prepaid reinsurance premiums
8.4
7.5
Due from affiliate
18.3
7.9
Current federal income taxes
6.7
6.3
Net deferred federal income taxes
44.6
42.2
Property and equipment, held for sale
4.2
4.2
Total assets
$
3,068.5
$
2,985.4
LIABILITIES
Losses and loss expenses payable
$
1,091.3
$
1,066.5
Unearned premiums
731.0
649.2
Notes payable (affiliates $15.2 and $15.2,
respectively)
122.0
122.0
Pension and postretirement benefits
54.0
72.9
Other liabilities
126.1
114.9
Total liabilities
2,124.4
2,025.5
STOCKHOLDERS' EQUITY
Common stock, without par value.
Authorized 100.0 shares; 50.7 and 50.4 shares issued, respectively,
at stated value of $2.50 per share
126.7
125.9
Treasury stock, 6.9 and 6.9 shares,
respectively, at cost
(118.4
)
(117.5
)
Additional paid-in capital
212.1
206.7
Accumulated other comprehensive income
(loss)
23.3
(37.9
)
Retained earnings
700.4
782.7
Total stockholders' equity
944.1
959.9
Total liabilities and stockholders'
equity
$
3,068.5
$
2,985.4
Condensed Consolidated Statements of
Income
($ in millions, except per share
amounts)
(unaudited)
Three months ended September
30
Nine months ended September
30
2020
2019
2020
2019
Earned premiums
$
353.2
$
319.6
$
1,024.4
$
930.0
Net investment income
17.9
19.3
54.5
60.4
Net investment gain (loss)
20.0
(5.0
)
(39.3
)
50.2
Other income from affiliates
0.5
0.6
1.6
1.6
Total revenues
391.6
334.5
1,041.2
1,042.2
Losses and loss expenses
251.6
208.4
762.2
637.6
Acquisition and operating expenses
123.0
109.7
357.4
325.2
Interest expense
1.1
1.2
3.6
3.7
Other expenses
1.1
2.5
5.6
9.0
Total expenses
376.8
321.8
1,128.8
975.5
Income (loss) before federal income
taxes
14.8
12.7
(87.6
)
66.7
Federal income tax expense (benefit):
Current
—
—
(0.4
)
(0.4
)
Deferred
3.2
1.2
(18.5
)
12.4
Federal income tax expense (benefit)
3.2
1.2
(18.9
)
12.0
Net income (loss)
$
11.6
$
11.5
$
(68.7
)
$
54.7
Earnings (loss) per common share:
Basic
$
0.26
$
0.26
$
(1.57
)
$
1.26
Diluted
$
0.26
$
0.25
$
(1.57
)
$
1.25
Dividends paid per common share
$
0.10
$
0.10
$
0.30
$
0.30
Consolidated Statements of
Comprehensive Income (Loss)
($ in millions)
(unaudited)
Three months ended September
30
Nine months ended September
30
2020
2019
2020
2019
Net income (loss)
$
11.6
$
11.5
$
(68.7
)
$
54.7
Other comprehensive income, net of
tax:
Net unrealized holding gain on
available-for-sale investments:
Unrealized holding gain
4.6
22.6
74.5
91.8
Reclassification adjustments for losses
(gains) realized in net income
0.2
(1.2
)
(3.2
)
(2.8
)
Income tax expense
(1.1
)
(4.5
)
(15.0
)
(18.7
)
Total net unrealized holding gain on
available- for-sale investments
3.7
16.9
56.3
70.3
Net unrecognized benefit plan
obligations:
Reclassification adjustments for
amortization to statements of income:
Prior service credit
(1.6
)
(1.6
)
(4.8
)
(4.8
)
Net actuarial loss
3.7
2.4
11.0
7.2
Income tax expense
(0.4
)
(0.2
)
(1.3
)
(0.5
)
Total net unrecognized benefit plan
obligations
1.7
0.6
4.9
1.9
Other comprehensive income
5.4
17.5
61.2
72.2
Comprehensive income (loss)
$
17.0
$
29.0
$
(7.5
)
$
126.9
Condensed Consolidated Statement of
Stockholders' Equity
($ and shares in millions)
(unaudited)
Nine Months Ended
Year Ended
September 30
December 31
2020
2019
Common shares:
Balance at beginning of year
50.4
50.0
Issuance of shares
0.3
0.4
Balance at period ended
50.7
50.4
Treasury shares:
Balance at beginning of year
(6.9)
(6.8)
Shares acquired on stock award exercises
and vested restricted shares
—
(0.1)
Balance at period ended
(6.9)
(6.9)
Common stock:
Balance at beginning of year
$
125.9
$
125.0
Issuance of shares
0.8
0.9
Balance at period ended
126.7
125.9
Treasury stock:
Balance at beginning of year
$
(117.5)
$
(117.0)
Shares acquired on stock award exercises
and vested restricted shares
(0.9)
(0.5)
Balance at beginning of year and period
ended
(118.4)
(117.5)
Additional paid-in capital:
Balance at beginning of year
$
206.7
$
194.2
Issuance of common stock
2.0
5.1
Stock awards granted
3.4
7.4
Balance at period ended
212.1
206.7
Accumulated other comprehensive income
(loss):
Balance at beginning of the year
$
(37.9)
$
(96.4)
Change in net unrealized holding gains on
available-for-sale investments
56.3
60.6
Total net unrecognized benefit plan
obligations
4.9
(2.1)
Balance at period ended
23.3
(37.9)
Retained earnings:
Balance at beginning of year
$
782.7
$
712.7
Cumulative effect of change in accounting
to establish an allowance for expected credit losses at January 1,
2020
(0.5)
—
Net (loss) income
(68.7)
87.4
Cash dividends paid
(13.1)
(17.4)
Balance at period ended
700.4
782.7
Total stockholders' equity at period
ended
$
944.1
$
959.9
Condensed Consolidated Statements of
Cash Flow
($ in millions)
(unaudited)
Nine months ended
September 30
2020
2019
Cash flows from operating
activities:
Net (loss) income
$
(68.7
)
$
54.7
Adjustments to reconcile net (loss) income
to net cash provided by (used in) operating activities
Depreciation and amortization, net
7.6
6.2
Share-based compensation
—
7.0
Net investment loss (gain)
39.3
(50.2
)
Changes in operating assets and
liabilities:
Deferred policy acquisition costs
(12.6
)
(12.4
)
Accrued investment income and other
assets
0.6
(2.3
)
Premiums receivable
(0.5
)
(3.2
)
Postretirement and pension benefits
(17.0
)
(12.2
)
Other liabilities and due to/from
affiliates, net
8.5
(51.8
)
Reinsurance recoverable on losses and loss
expenses payable and prepaid reinsurance premiums
(22.5
)
(2.6
)
Losses and loss expenses payable
24.2
(54.1
)
Unearned premiums
81.8
65.0
Deferred tax on share-based awards
(0.1
)
(0.7
)
Federal income taxes
(18.8
)
12.7
Net cash provided by (used in)
operating activities
21.8
(43.9
)
Cash flows from investing
activities:
Purchases of fixed maturities
available-for-sale
(462.6
)
(459.9
)
Purchases of equity securities
(65.6
)
(48.9
)
Purchases of other invested assets
(7.3
)
(12.9
)
Maturities, calls and pay downs of fixed
maturities available-for-sale
274.9
267.1
Sales of fixed maturities
available-for-sale
216.1
248.7
Sales of equity securities
86.2
34.4
Sales of other invested assets
0.9
1.0
Disposals of property and equipment
0.2
1.6
Net cash provided by investing
activities
42.8
31.1
Cash flows from financing
activities:
Proceeds from issuance of common stock
2.8
4.8
Payments to acquire treasury stock
(0.9
)
(0.5
)
Payment of dividends
(13.1
)
(13.0
)
Proceeds from short-term debt
60.0
—
Repayment of short-term debt
(60.0
)
—
Proceeds from long-term debt
21.5
—
Repayment of long-term debt
(21.5
)
—
Net cash used in financing
activities
(11.2
)
(8.7
)
Net increase (decrease) in cash and cash
equivalents
53.4
(21.5
)
Cash and cash equivalents at beginning of
period
78.0
59.8
Cash and cash equivalents at end of
period
$
131.4
$
38.3
Supplemental disclosures:
Interest paid (affiliates $0.6 and $0.7,
respectively)
$
3.5
$
3.5
Net Investment Income
($ in millions)
(unaudited)
9/30/2019
12/31/2019
3/31/2020
6/30/2020
9/30/2020
Quarter to Date
Gross investment income:
Fixed maturities
$
14.4
$
13.9
$
14.5
$
14.8
$
13.7
TIPS
0.9
0.7
0.6
(0.3)
1.3
Total fixed maturities
15.3
14.6
15.1
14.5
15.0
Equity securities
3.0
4.3
3.1
2.6
2.1
Other
1.1
1.3
1.0
0.8
0.9
Total gross investment income
19.4
20.2
19.2
17.9
18.0
Less: Investment expenses
0.1
0.2
0.3
0.2
0.1
Net investment income
$
19.3
$
20.0
$
18.9
$
17.7
$
17.9
Year to Date
Gross investment income:
Fixed maturities
$
44.5
$
58.4
$
14.5
$
29.3
$
43.0
TIPS
3.2
3.9
0.6
0.3
1.6
Total fixed maturities
47.7
62.3
15.1
29.6
44.6
Equity securities
8.9
13.2
3.1
5.7
7.8
Other
4.2
5.5
1.0
1.8
2.7
Total gross investment income
60.8
81.0
19.2
37.1
55.1
Less: Investment expenses
0.4
0.6
0.3
0.5
0.6
Net investment income
$
60.4
$
80.4
$
18.9
$
36.6
$
54.5
9/30/2019
12/31/2019
3/31/2020
6/30/2020
9/30/2020
TIPS, fair value
$
135.3
$
135.6
$
111.4
$
115.9
$
117.0
TIPS, book value
$
125.9
$
126.2
$
101.5
$
100.9
$
99.4
Net Investment Gain (Loss)
($ in millions)
unaudited
Three months ended September
30
Nine months ended September
30
2020
2019
2020
2019
Investment gain (loss), net:
Fixed maturities:
Realized gains on sales of securities
$
1.3
$
1.2
$
6.8
$
2.8
Realized losses on sales of securities
(1.5
)
—
(3.6
)
—
Net (loss) gain on fixed securities
(0.2
)
1.2
3.2
2.8
Equity securities:
Realized losses on sales of securities,
net
(42.3
)
(1.8
)
(50.9
)
(2.5
)
Unrealized gain (loss) on securities still
held, net
60.5
(4.1
)
15.8
46.4
Net gain (loss) on equity securities
18.2
(5.9
)
(35.1
)
43.9
Other invested assets:
Unrealized gain (loss) on securities still
held, net
2.0
(0.3
)
(7.6
)
4.8
Net gain (loss) on other invested
assets
2.0
(0.3
)
(7.6
)
4.8
Other net realized gain (loss)
—
—
0.2
(1.3
)
Net gain (loss) on investments
$
20.0
$
(5.0
)
$
(39.3
)
$
50.2
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
December 31
2020
2019
Deferred tax assets:
Unearned premiums not currently
deductible
$
30.4
$
27.0
Losses and loss expenses payable
discounting
11.5
10.6
Postretirement and pension benefits
16.7
20.0
Other liabilities
11.2
13.4
Net operating loss carryforward
26.1
12.1
Capital loss carryforward
7.8
—
Tax credit carryforward
2.0
2.5
Other
0.8
1.1
Total deferred tax assets
106.5
86.7
Deferred tax liabilities:
Deferral of policy acquisition costs
26.0
23.3
Investments
35.4
21.2
Total deferred tax liabilities
61.4
44.5
Total net deferred tax assets before
valuation allowance
45.1
42.2
Less valuation allowance
0.5
—
Net deferred federal income taxes
$
44.6
$
42.2
The following table sets forth the
components of federal income tax expense (benefit):
Three months ended September
30
Nine months ended September
30
2020
2019
2020
2019
Income (loss) before federal income
taxes
$
14.8
$
12.7
$
(87.6
)
$
66.7
Federal income tax expense (benefit)
Current
—
—
(0.4
)
(0.4
)
Deferred
3.2
1.2
(18.5
)
12.4
Total federal income tax expense
(benefit)
3.2
1.2
(18.9
)
12.0
Net income (loss)
$
11.6
$
11.5
$
(68.7
)
$
54.7
SAP Personal Insurance Segment
Results
(unaudited)
($ in millions)
Three months ended September 30,
2020
Personal Auto
Homeowners
Other Personal
Total
Net written premiums
$
101.4
$
111.4
$
17.4
$
230.2
Net earned premiums
103.0
92.5
13.3
208.8
Losses and LAE incurred:
Cat loss and ALAE
1.9
28.1
2.9
32.9
Non-cat loss and ALAE
Prior accident years non-cat loss and
ALAE
8.0
0.7
(0.6
)
8.1
Current accident year non-cat loss and
ALAE
58.2
50.7
4.8
113.7
Total non-cat loss and ALAE
66.2
51.4
4.2
121.8
Total Loss and ALAE
68.1
79.5
7.1
154.7
ULAE
7.4
6.8
0.2
14.4
Total Loss and LAE
75.5
86.3
7.3
169.1
Underwriting expenses
32.0
33.2
5.2
70.4
Net underwriting (loss) gain
$
(4.5
)
$
(27.0
)
$
0.8
$
(30.7
)
Cat loss and ALAE ratio
1.9
%
30.4
%
21.5
%
15.8
%
Non-cat loss and ALAE ratio
Prior accident years non-cat loss and ALAE
ratio
7.8
%
0.7
%
(4.1
)%
3.9
%
Current accident year non-cat loss and
ALAE ratio
56.4
%
54.9
%
36.2
%
54.4
%
Total non-cat loss and ALAE ratio
64.2
%
55.6
%
32.1
%
58.3
%
Total Loss and ALAE ratio
66.1
%
86.0
%
53.6
%
74.1
%
ULAE ratio
7.2
%
7.3
%
1.6
%
6.9
%
Total Loss and LAE ratio
73.3
%
93.3
%
55.2
%
81.0
%
Expense ratio
31.4
%
29.8
%
29.4
%
30.5
%
Combined ratio
104.7
%
123.1
%
84.6
%
111.5
%
($ in millions)
Three months ended September 30, 2019
Personal Auto
Homeowners
Other Personal
Total
Net written premiums
$
107.1
$
91.5
$
11.2
$
209.8
Net earned premiums
108.3
75.6
8.8
192.7
Losses and LAE incurred:
Cat loss and ALAE
0.9
7.0
0.3
8.2
Non-cat loss and ALAE
Prior accident years non-cat loss and
ALAE
(1.2
)
—
(0.9
)
(2.1
)
Current accident year non-cat loss and
ALAE
73.0
41.2
4.7
118.9
Total non-cat loss and ALAE
71.8
41.2
3.8
116.8
Total Loss and ALAE
72.7
48.2
4.1
125.0
ULAE
7.4
4.4
0.2
12.0
Total Loss and LAE
80.1
52.6
4.3
137.0
Underwriting expenses
30.9
27.8
3.3
62.0
Net underwriting (loss) gain
$
(2.7
)
$
(4.8
)
$
1.2
$
(6.3
)
Cat loss and ALAE ratio
0.8
%
9.2
%
3.5
%
4.2
%
Non-cat loss and ALAE ratio
Prior accident years non-cat loss and ALAE
ratio
(1.2
)%
0.1
%
(9.8
)%
(1.1
)%
Current accident year non-cat loss and
ALAE ratio
67.4
%
54.5
%
52.5
%
61.7
%
Total non-cat loss and ALAE ratio
66.2
%
54.6
%
42.7
%
60.6
%
Total Loss and ALAE ratio
67.0
%
63.8
%
46.2
%
64.8
%
ULAE ratio
6.9
%
5.8
%
2.0
%
6.2
%
Total Loss and LAE ratio
73.9
%
69.6
%
48.2
%
71.0
%
Expense ratio
28.9
%
30.3
%
29.6
%
29.6
%
Combined ratio
102.8
%
99.9
%
77.8
%
100.6
%
($ in millions)
Nine months ended September 30,
2020
Personal Auto
Homeowners
Other Personal
Total
Net written premiums
$
310.3
$
299.1
$
45.7
$
655.1
Net earned premiums
311.0
262.9
35.8
609.7
Losses and LAE incurred:
Cat loss and ALAE
6.5
93.4
12.0
111.9
Non-cat loss and ALAE
Prior accident years non-cat loss and
ALAE
19.1
2.8
(1.7
)
20.2
Current accident year non-cat loss and
ALAE
165.7
125.0
13.0
303.7
Total non-cat loss and ALAE
184.8
127.8
11.3
323.9
Total Loss and ALAE
191.3
221.2
23.3
435.8
ULAE
23.0
18.6
1.2
42.8
Total Loss and LAE
214.3
239.8
24.5
478.6
Underwriting expenses
98.5
89.7
13.7
201.9
Net underwriting loss
$
(1.8
)
$
(66.6
)
$
(2.4
)
$
(70.8
)
Cat loss and ALAE ratio
2.1
%
35.5
%
33.4
%
18.4
%
Non-cat loss and ALAE ratio
Prior accident years non-cat loss and ALAE
ratio
6.2
%
1.0
%
(4.5
)%
3.3
%
Current accident year non-cat loss and
ALAE ratio
53.2
%
47.6
%
36.2
%
49.8
%
Total non-cat loss and ALAE ratio
59.4
%
48.6
%
31.7
%
53.1
%
Total Loss and ALAE ratio
61.5
%
84.1
%
65.1
%
71.5
%
ULAE ratio
7.4
%
7.1
%
3.4
%
7.0
%
Total Loss and LAE ratio
68.9
%
91.2
%
68.5
%
78.5
%
Expense ratio
31.7
%
30.0
%
30.0
%
30.8
%
Combined ratio
100.6
%
121.2
%
98.5
%
109.3
%
($ in millions)
Nine months ended September 30, 2019
Personal Auto
Homeowners
Other Personal
Total
Net written premiums
$
324.8
$
241.4
$
29.0
$
595.2
Net earned premiums
322.1
216.1
24.3
562.5
Losses and LAE incurred:
Cat loss and ALAE
5.4
47.8
4.0
57.2
Non-cat loss and ALAE
Prior accident years non-cat loss and
ALAE
(11.0
)
0.5
(1.9
)
(12.4
)
Current accident year non-cat loss and
ALAE
207.8
110.4
12.7
330.9
Total non-cat loss and ALAE
196.8
110.9
10.8
318.5
Total Loss and ALAE
202.2
158.7
14.8
375.7
ULAE
22.2
15.1
0.9
38.2
Total Loss and LAE
224.4
173.8
15.7
413.9
Underwriting expenses
96.7
74.8
9.1
180.6
Net underwriting gain (loss)
$
1.0
$
(32.5
)
$
(0.5
)
$
(32.0
)
Cat loss and ALAE ratio
1.6
%
22.1
%
16.5
%
10.2
%
Non-cat loss and ALAE ratio
Prior accident years non-cat loss and ALAE
ratio
(3.4
)%
0.3
%
(7.8
)%
(2.2
)%
Current accident year non-cat loss and
ALAE ratio
64.5
%
51.0
%
52.0
%
58.7
%
Total non-cat loss and ALAE ratio
61.1
%
51.3
%
44.2
%
56.5
%
Total Loss and ALAE ratio
62.7
%
73.4
%
60.7
%
66.7
%
ULAE ratio
6.9
%
7.0
%
3.7
%
6.8
%
Total Loss and LAE ratio
69.6
%
80.4
%
64.4
%
73.5
%
Expense ratio
29.8
%
31.0
%
31.5
%
30.4
%
Combined ratio
99.4
%
111.4
%
95.9
%
103.9
%
SAP Commercial Insurance Segment
Results
(unaudited)
($ in millions)
Three months ended September 30,
2020
Commercial Auto
Small Commercial Package
Middle Market Commercial
Workers' Comp
Farm & Ranch
Other Commercial
Total
Net written premiums
$
40.0
$
31.4
$
40.0
$
17.4
$
15.0
$
5.0
$
148.8
Net earned premiums
35.6
31.4
40.3
17.5
14.5
5.1
144.4
Losses and LAE incurred:
Cat loss and ALAE
0.1
5.5
4.7
—
3.2
—
13.5
Non-cat loss and ALAE
Prior accident years non-cat loss and
ALAE
(1.2
)
(7.5
)
(6.3
)
(7.3
)
(0.6
)
(3.6
)
(26.5
)
Current accident year non-cat loss and
ALAE
20.8
17.0
20.1
14.4
5.1
3.0
80.4
Total non-cat loss and ALAE
19.6
9.5
13.8
7.1
4.5
(0.6
)
53.9
Total Loss and ALAE
19.7
15.0
18.5
7.1
7.7
(0.6
)
67.4
ULAE
1.7
0.5
1.3
1.1
0.5
0.1
5.2
Total Loss and LAE
21.4
15.5
19.8
8.2
8.2
(0.5
)
72.6
Underwriting expenses
13.7
10.9
16.4
7.8
6.7
1.9
57.4
Net underwriting gain (loss)
$
0.5
$
5.0
$
4.1
$
1.5
$
(0.4
)
$
3.7
$
14.4
Cat loss and ALAE ratio
0.4
%
17.3
%
11.6
%
—
%
22.1
%
—
%
9.3
%
Non-cat loss and ALAE ratio
Prior accident years non-cat loss and ALAE
ratio
(3.4
)%
(23.8
)%
(15.5
)%
(41.6
)%
(4.2
)%
(72.6
)%
(18.3
)%
Current accident year non-cat loss and
ALAE ratio
58.3
%
54.3
%
49.7
%
82.2
%
35.0
%
60.4
%
55.7
%
Total non-cat loss and ALAE ratio
54.9
%
30.5
%
34.2
%
40.6
%
30.8
%
(12.2
)%
37.4
%
Total Loss and ALAE ratio
55.3
%
47.8
%
45.8
%
40.6
%
52.9
%
(12.2
)%
46.7
%
ULAE ratio
4.8
%
1.5
%
3.3
%
6.4
%
3.4
%
1.9
%
3.6
%
Total Loss and LAE ratio
60.1
%
49.3
%
49.1
%
47.0
%
56.3
%
(10.3
)%
50.3
%
Expense ratio
34.2
%
34.7
%
41.0
%
45.1
%
45.1
%
38.6
%
38.6
%
Combined ratio
94.3
%
84.0
%
90.1
%
92.1
%
101.4
%
28.3
%
88.9
%
($ in millions)
Three months ended September 30, 2019
Commercial Auto
Small Commercial Package
Middle Market Commercial
Workers' Comp
Farm & Ranch
Other Commercial
Total
Net written premiums
$
27.7
$
30.0
$
39.8
$
23.9
$
11.4
$
4.6
$
137.4
Net earned premiums
23.8
29.9
34.9
21.7
12.4
4.3
127.0
Losses and LAE incurred:
Cat loss and ALAE
0.1
1.1
0.5
—
0.4
—
2.1
Non-cat loss and ALAE
Prior accident years non-cat loss and
ALAE
(1.1
)
(4.1
)
(1.2
)
(4.4
)
(0.7
)
(1.6
)
(13.1
)
Current accident year non-cat loss and
ALAE
15.2
17.9
19.7
13.9
6.2
3.2
76.1
Total non-cat loss and ALAE
14.1
13.8
18.5
9.5
5.5
1.6
63.0
Total Loss and ALAE
14.2
14.9
19.0
9.5
5.9
1.6
65.1
ULAE
1.6
1.3
2.0
1.8
0.4
0.1
7.2
Total Loss and LAE
15.8
16.2
21.0
11.3
6.3
1.7
72.3
Underwriting expenses
11.9
11.7
15.9
7.2
4.7
2.1
53.5
Net underwriting (loss) gain
$
(3.9
)
$
2.0
$
(2.0
)
$
3.2
$
1.4
$
0.5
$
1.2
Cat loss and ALAE ratio
0.5
%
3.7
%
1.6
%
—
%
3.2
%
—
%
1.7
%
Non-cat loss and ALAE ratio
Prior accident years non-cat loss and ALAE
ratio
(4.6
)%
(13.7
)%
(3.6
)%
(20.1
)%
(5.7
)%
(37.9
)%
(10.4
)%
Current accident year non-cat loss and
ALAE ratio
63.8
%
60.1
%
56.3
%
64.2
%
50.0
%
75.9
%
60.0
%
Total non-cat loss and ALAE ratio
59.2
%
46.4
%
52.7
%
44.1
%
44.3
%
38.0
%
49.6
%
Total Loss and ALAE ratio
59.7
%
50.1
%
54.3
%
44.1
%
47.5
%
38.0
%
51.3
%
ULAE ratio
6.7
%
4.2
%
5.7
%
8.3
%
3.2
%
4.1
%
5.7
%
Total Loss and LAE ratio
66.4
%
54.3
%
60.0
%
52.4
%
50.7
%
42.1
%
57.0
%
Expense ratio
43.0
%
39.1
%
40.0
%
30.0
%
41.7
%
42.2
%
38.9
%
Combined ratio
109.4
%
93.4
%
100.0
%
82.4
%
92.4
%
84.3
%
95.9
%
($ in millions)
Nine months ended September 30,
2020
Commercial Auto
Small Commercial Package
Middle Market Commercial
Workers' Comp
Farm & Ranch
Other Commercial
Total
Net written premiums
$
117.8
$
95.8
$
126.8
$
49.2
$
47.3
$
15.3
$
452.2
Net earned premiums
96.2
92.8
116.0
54.4
40.8
14.5
414.7
Losses and LAE incurred:
Cat loss and ALAE
1.1
21.0
35.7
—
8.7
0.2
66.7
Non-cat loss and ALAE
Prior accident years non-cat loss and
ALAE
(1.5
)
(16.5
)
(14.3
)
(16.1
)
(1.7
)
(7.1
)
(57.2
)
Current accident year non-cat loss and
ALAE
52.4
53.3
69.6
40.6
15.2
7.3
238.4
Total non-cat loss and ALAE
50.9
36.8
55.3
24.5
13.5
0.2
181.2
Total Loss and ALAE
52.0
57.8
91.0
24.5
22.2
0.4
247.9
ULAE
4.9
4.2
4.5
4.5
1.6
0.4
20.1
Total Loss and LAE
56.9
62.0
95.5
29.0
23.8
0.8
268.0
Underwriting expenses
40.1
34.0
50.8
22.7
21.1
6.0
174.7
Net underwriting (loss) gain
$
(0.8
)
$
(3.2
)
$
(30.3
)
$
2.7
$
(4.1
)
$
7.7
$
(28.0
)
Cat loss and ALAE ratio
1.2
%
22.6
%
30.7
%
—
%
21.3
%
1.2
%
16.1
%
Non-cat loss and ALAE ratio
Prior accident years non-cat loss and ALAE
ratio
(1.5
)%
(17.8
)%
(12.3
)%
(29.6
)%
(4.1
)%
(49.3
)%
(13.8
)%
Current accident year non-cat loss and
ALAE ratio
54.3
%
57.5
%
60.1
%
74.6
%
37.3
%
50.7
%
57.4
%
Total non-cat loss and ALAE ratio
52.8
%
39.7
%
47.8
%
45.0
%
33.2
%
1.4
%
43.6
%
Total Loss and ALAE ratio
54.0
%
62.3
%
78.5
%
45.0
%
54.5
%
2.6
%
59.7
%
ULAE ratio
5.1
%
4.5
%
3.9
%
8.4
%
3.9
%
2.6
%
4.9
%
Total Loss and LAE ratio
59.1
%
66.8
%
82.4
%
53.4
%
58.4
%
5.2
%
64.6
%
Expense ratio
34.1
%
35.5
%
40.0
%
46.2
%
44.6
%
39.3
%
38.6
%
Combined ratio
93.2
%
102.3
%
122.4
%
99.6
%
103.0
%
44.5
%
103.2
%
($ in millions)
Nine months ended September 30, 2019
Commercial Auto
Small Commercial Package
Middle Market Commercial
Workers' Comp
Farm & Ranch
Other Commercial
Total
Net written premiums
$
81.4
$
92.0
$
115.1
$
58.8
$
37.4
$
14.1
$
398.8
Net earned premiums
65.3
88.9
98.1
60.3
36.2
12.6
361.4
Losses and LAE incurred:
Cat loss and ALAE
0.2
6.1
5.7
—
2.5
—
14.5
Non-cat loss and ALAE
Prior accident years non-cat loss and
ALAE
(3.6
)
(11.8
)
(7.2
)
(13.4
)
(1.9
)
(1.4
)
(39.3
)
Current accident year non-cat loss and
ALAE
41.2
51.3
62.2
42.3
18.0
7.7
222.7
Total non-cat loss and ALAE
37.6
39.5
55.0
28.9
16.1
6.3
183.4
Total Loss and ALAE
37.8
45.6
60.7
28.9
18.6
6.3
197.9
ULAE
4.2
4.8
5.0
5.4
1.5
0.5
21.4
Total Loss and LAE
42.0
50.4
65.7
34.3
20.1
6.8
219.3
Underwriting expenses
33.6
36.0
46.0
20.2
17.4
6.0
159.2
Net underwriting (loss) gain
$
(10.3
)
$
2.5
$
(13.6
)
$
5.8
$
(1.3
)
$
(0.2
)
$
(17.1
)
Cat loss and ALAE ratio
0.4
%
6.9
%
5.8
%
—
%
6.8
%
—
%
4.0
%
Non-cat loss and ALAE ratio
Prior accident years non-cat loss and ALAE
ratio
(5.5
)%
(13.3
)%
(7.4
)%
(22.1
)%
(5.2
)%
(11.2
)%
(10.9
)%
Current accident year non-cat loss and
ALAE ratio
62.9
%
57.7
%
63.4
%
70.2
%
49.7
%
61.7
%
61.7
%
Total non-cat loss and ALAE ratio
57.4
%
44.4
%
56.0
%
48.1
%
44.5
%
50.5
%
50.8
%
Total Loss and ALAE ratio
57.8
%
51.3
%
61.8
%
48.1
%
51.3
%
50.5
%
54.8
%
ULAE ratio
6.5
%
5.4
%
5.1
%
8.9
%
4.2
%
4.3
%
5.9
%
Total Loss and LAE ratio
64.3
%
56.7
%
66.9
%
57.0
%
55.5
%
54.8
%
60.7
%
Expense ratio
41.3
%
39.1
%
40.0
%
34.4
%
46.6
%
41.7
%
39.9
%
Combined ratio
105.6
%
95.8
%
106.9
%
91.4
%
102.1
%
96.5
%
100.6
%
SAP Insurance Segment Results
(unaudited)
($ in millions)
Three months ended September 30,
2020
Personal & Commercial
Specialty run-off
Total
Net written premiums
$
379.0
$
0.1
$
379.1
Net earned premiums
353.2
—
353.2
Losses and LAE incurred:
Cat loss and ALAE
46.4
12.3
58.7
Non-cat loss and ALAE
Prior accident years non-cat loss and
ALAE
(18.4
)
(0.9
)
(19.3
)
Current accident year non-cat loss and
ALAE
194.1
0.2
194.3
Total non-cat loss and ALAE
175.7
(0.7
)
175.0
Total Loss and ALAE
222.1
11.6
233.7
ULAE
19.6
(1.3
)
18.3
Total Loss and LAE
241.7
10.3
252.0
Underwriting expenses
127.8
0.1
127.9
Net underwriting loss
$
(16.3
)
$
(10.4
)
$
(26.7
)
Cat loss and ALAE ratio
13.1
%
N/M(1)
16.6
%
Non-cat loss and ALAE ratio
Prior accident years non-cat loss and ALAE
ratio
(5.2
)%
N/M
(5.5
)%
Current accident year non-cat loss and
ALAE ratio
55.1
%
N/M
55.0
%
Total non-cat loss and ALAE ratio
49.9
%
N/M
49.5
%
Total Loss and ALAE ratio
63.0
%
N/M
66.1
%
ULAE ratio
5.5
%
N/M
5.2
%
Total Loss and LAE ratio
68.5
%
N/M
71.3
%
Expense ratio
33.7
%
N/M
33.8
%
Combined ratio
102.2
%
N/M
105.1
%
(1) N/M = Not Meaningful
($ in millions)
Three months ended September 30, 2019
Personal & Commercial
Specialty run-off
Total
Net written premiums
$
347.2
$
(0.4
)
$
346.8
Net earned premiums
319.7
(0.1
)
319.6
Losses and LAE incurred:
Cat loss and ALAE
10.3
0.3
10.6
Non-cat loss and ALAE
Prior accident years non-cat loss and
ALAE
(15.2
)
(0.9
)
(16.1
)
Current accident year non-cat loss and
ALAE
195.0
0.1
195.1
Total non-cat loss and ALAE
179.8
(0.8
)
179.0
Total Loss and ALAE
190.1
(0.5
)
189.6
ULAE
19.2
(0.1
)
19.1
Total Loss and LAE
209.3
(0.6
)
208.7
Underwriting expenses
115.5
1.1
116.6
Net underwriting loss
$
(5.1
)
$
(0.6
)
$
(5.7
)
Cat loss and ALAE ratio
3.2
%
N/M
3.3
%
Non-cat loss and ALAE ratio
Prior accident years non-cat loss and ALAE
ratio
(4.8
)%
N/M
(5.1
)%
Current accident year non-cat loss and
ALAE ratio
61.0
%
N/M
61.2
%
Total non-cat loss and ALAE ratio
56.2
%
N/M
56.1
%
Total Loss and ALAE ratio
59.4
%
N/M
59.4
%
ULAE ratio
6.0
%
N/M
6.0
%
Total Loss and LAE ratio
65.4
%
N/M
65.4
%
Expense ratio
33.3
%
N/M
33.6
%
Combined ratio
98.7
%
N/M
99.0
%
($ in millions)
Nine months ended September 30,
2020
Personal & Commercial
Specialty run-off
Total
Net written premiums
$
1,107.3
$
(0.1)
$
1,107.2
Net earned premiums
1,024.4
—
1,024.4
Losses and LAE incurred:
Cat loss and ALAE
178.6
12.4
191.0
Non-cat loss and ALAE
Prior accident years non-cat loss and
ALAE
(37.0)
5.2
(31.8)
Current accident year non-cat loss and
ALAE
542.1
0.3
542.4
Total non-cat loss and ALAE
505.1
5.5
510.6
Total Loss and ALAE
683.7
17.9
701.6
ULAE
62.9
(1.3)
61.6
Total Loss and LAE
746.6
16.6
763.2
Underwriting expenses
376.6
0.5
377.1
Net underwriting loss
$
(98.8)
$
(17.1)
$
(115.9)
Cat loss and ALAE ratio
17.4
%
N/M
18.6
%
Non-cat loss and ALAE ratio
Prior accident years non-cat loss and ALAE
ratio
(3.6)
%
N/M
(3.1)
%
Current accident year non-cat loss and
ALAE ratio
53.0
%
N/M
53.0
%
Total non-cat loss and ALAE ratio
49.4
%
N/M
49.9
%
Total Loss and ALAE ratio
66.8
%
N/M
68.5
%
ULAE ratio
6.1
%
N/M
6.0
%
Total Loss and LAE ratio
72.9
%
N/M
74.5
%
Expense ratio
34.0
%
N/M
34.1
%
Combined ratio
106.9
%
N/M
108.6
%
($ in millions)
Nine months ended September 30, 2019
Personal & Commercial
Specialty run-off
Total
Net written premiums
$
994.0
$
0.5
$
994.5
Net earned premiums
923.9
6.1
930.0
Losses and LAE incurred:
Cat loss and ALAE
71.7
4.0
75.7
Non-cat loss and ALAE
Prior accident years non-cat loss and
ALAE
(51.7
)
(2.4
)
(54.1
)
Current accident year non-cat loss and
ALAE
553.6
4.9
558.5
Total non-cat loss and ALAE
501.9
2.5
504.4
Total Loss and ALAE
573.6
6.5
580.1
ULAE
59.6
(0.8
)
58.8
Total Loss and LAE
633.2
5.7
638.9
Underwriting expenses
339.8
1.7
341.5
Net underwriting loss
$
(49.1
)
$
(1.3
)
$
(50.4
)
Cat loss and ALAE ratio
7.8
%
N/M
8.1
%
Non-cat loss and ALAE ratio
Prior accident years non-cat loss and ALAE
ratio
(5.6
)%
N/M
(5.8
)%
Current accident year non-cat loss and
ALAE ratio
59.9
%
N/M
60.1
%
Total non-cat loss and ALAE ratio
54.3
%
N/M
54.3
%
Total Loss and ALAE ratio
62.1
%
N/M
62.4
%
ULAE ratio
6.4
%
N/M
6.3
%
Total Loss and LAE ratio
68.5
%
N/M
68.7
%
Expense ratio
34.2
%
N/M
34.3
%
Combined ratio
102.7
%
N/M
103.0
%
The following table provides a reconciliation of our statutory
underwriting results to GAAP consolidated income (loss) before
federal income taxes for the three and nine months ended September
30, 2020 and 2019:
($ millions)
3Q 2020
3Q 2019
YTD 2020
YTD 2019
Segment income (loss) before federal
income taxes:
Insurance operations:
Personal insurance SAP underwriting
loss
$
(30.7
)
$
(6.3
)
$
(70.8
)
$
(32.0
)
Commercial insurance SAP underwriting gain
(loss)
14.4
1.2
(28.0
)
(17.1
)
Specialty run-off
(10.4
)
(0.6
)
(17.1
)
(1.3
)
Total insurance operations
(26.7
)
(5.7
)
(115.9
)
(50.4
)
Investment operations:
Net investment income
17.9
19.3
54.5
60.4
Net investment gain (loss)
20.0
(5.0
)
(39.3
)
50.2
Total investment operations
37.9
14.3
15.2
110.6
All other segments income
—
—
0.1
0.2
Reconciling items:
GAAP adjustments
5.6
7.2
20.2
17.3
Interest expense on corporate debt
(1.1
)
(1.2
)
(3.6
)
(3.7
)
Corporate expenses
(0.9
)
(1.9
)
(3.6
)
(7.3
)
Total reconciling items
3.6
4.1
13.0
6.3
Total consolidated income (loss) before
federal income taxes
$
14.8
$
12.7
$
(87.6
)
$
66.7
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201105005195/en/
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
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