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Share Name | Share Symbol | Market | Type |
---|---|---|---|
United Fire Group Inc | NASDAQ:UFCS | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-0.29 | -1.26% | 22.64 | 21.27 | 23.36 | 23.29 | 22.56 | 23.06 | 64,848 | 22:30:00 |
Iowa | 45-2302834 | |||||||
(State of incorporation) | (I.R.S. Employer Identification No.) |
118 Second Avenue SE | ||||||||
Cedar Rapids |
Iowa
|
52401
|
||||||
(Address of principal executive offices) (Zip Code) |
Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||
Common Stock, $0.001 par value | UFCS | The NASDAQ Global Select Market |
Large accelerated filer |
☒
|
Accelerated filer |
☐
|
Non-accelerated filer |
☐
|
Smaller reporting company |
☐
|
||||||||||||||||
Emerging growth company |
☐
|
Page | |||||
Signatures
|
United Fire Group, Inc.
Consolidated Balance Sheets |
(In Thousands, Except Share Data) |
June 30,
2021 |
December 31,
2020 |
|||||||||
(unaudited) | |||||||||||
ASSETS | |||||||||||
Investments | |||||||||||
Fixed maturities | |||||||||||
Available-for-sale, at fair value (amortized cost $1,697,219 in 2021 and $1,720,291 in 2020; allowance for credit losses $170 in 2021 and $5 in 2020)
|
$ | 1,781,865 | $ | 1,825,438 | |||||||
Equity securities at fair value (cost $67,295 in 2021 and $49,085 in 2020)
|
196,880 | 206,685 | |||||||||
Mortgage loans | 47,449 | 47,690 | |||||||||
Less: allowance for mortgage loan losses | 76 | 76 | |||||||||
Mortgage loans, net | 47,373 | 47,614 | |||||||||
Other long-term investments | 80,326 | 69,305 | |||||||||
Short-term investments available-for-sale, at fair value (amortized cost $800 in 2021 and $175 in 2020)
|
801 | 175 | |||||||||
2,107,245 | 2,149,217 | ||||||||||
Cash and cash equivalents | 118,519 | 87,948 | |||||||||
Accrued investment income | 13,826 | 14,615 | |||||||||
Premiums receivable (net of allowance for doubtful accounts of $779 in 2021 and $687 in 2020)
|
334,267 | 317,292 | |||||||||
Deferred policy acquisition costs | 96,286 | 87,094 | |||||||||
Property and equipment (primarily land and buildings, at cost, less accumulated depreciation of $57,967 in 2021 and $55,141 in 2020)
|
134,650 | 129,874 | |||||||||
Reinsurance receivables and recoverables (net of allowance for credit losses of $126 in 2021 and $190 in 2020)
|
124,785 | 160,540 | |||||||||
Prepaid reinsurance premiums | 12,351 | 12,965 | |||||||||
Intangible assets | 6,388 | 6,743 | |||||||||
Income taxes receivable | 62,268 | 66,194 | |||||||||
Other assets | 47,568 | 37,196 | |||||||||
TOTAL ASSETS | $ | 3,058,153 | $ | 3,069,678 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
Liabilities | |||||||||||
Losses and loss settlement expenses | $ | 1,568,453 | $ | 1,578,131 | |||||||
Unearned premiums | 474,171 | 464,845 | |||||||||
Accrued expenses and other liabilities | 101,542 | 126,624 | |||||||||
Long term debt | 50,000 | 50,000 | |||||||||
Deferred tax liability | 24,512 | 24,929 | |||||||||
TOTAL LIABILITIES | $ | 2,218,678 | $ | 2,244,529 | |||||||
Stockholders’ Equity | |||||||||||
Common stock, $0.001 par value; authorized 75,000,000 shares; 25,117,340 and 25,055,479 shares issued and outstanding in 2021 and 2020, respectively
|
$ | 25 | $ | 25 | |||||||
Additional paid-in capital | 203,055 | 202,359 | |||||||||
Retained earnings | 580,767 | 555,854 | |||||||||
Accumulated other comprehensive income, net of tax | 55,628 | 66,911 | |||||||||
TOTAL STOCKHOLDERS’ EQUITY | $ | 839,475 | $ | 825,149 | |||||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 3,058,153 | $ | 3,069,678 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
(In Thousands, Except Share Data) | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||
Revenues | |||||||||||||||||||||||
Net premiums earned | $ | 224,703 | $ | 263,609 | $ | 483,928 | $ | 532,458 | |||||||||||||||
Investment income, net of investment expenses | 13,795 | 12,696 | 30,876 | 15,059 | |||||||||||||||||||
Net realized investment gains (losses) (includes reclassifications for net unrealized investment gains/(losses) on available-for-sale securities of $141 and $(666) in 2021 and $80 and $(41) in 2020; previously included in accumulated other comprehensive income)
|
6,004 | 15,779 | 30,512 | (77,628) | |||||||||||||||||||
Other income (loss) | (90) | 5,719 | (169) | 5,719 | |||||||||||||||||||
Total revenues | $ | 244,412 | $ | 297,803 | $ | 545,147 | $ | 475,608 | |||||||||||||||
Benefits, Losses and Expenses | |||||||||||||||||||||||
Losses and loss settlement expenses | $ | 152,139 | $ | 204,973 | $ | 358,537 | $ | 391,476 | |||||||||||||||
Amortization of deferred policy acquisition costs | 46,007 | 51,893 | 99,272 | 106,345 | |||||||||||||||||||
Other underwriting expenses (includes reclassifications for employee benefit costs of $1,645 and $3,312 in 2021 and $1,072 and $2,144 in 2020; previously included in accumulated other comprehensive income)
|
28,400 | 36,701 | 46,768 | 78,550 | |||||||||||||||||||
Interest Expense | 1,594 | — | 1,594 | — | |||||||||||||||||||
Total benefits, losses and expenses | $ | 228,140 | $ | 293,567 | $ | 506,171 | $ | 576,371 | |||||||||||||||
Income (loss) before income taxes | $ | 16,272 | $ | 4,236 | $ | 38,976 | $ | (100,763) | |||||||||||||||
Federal income tax expense (benefit) (includes reclassifications of $316 and $835 in 2021 and $207 and $458 in 2020; previously included in accumulated other comprehensive income)
|
2,522 | (1,724) | 6,524 | (34,189) | |||||||||||||||||||
Net Income (loss) | $ | 13,750 | $ | 5,960 | $ | 32,452 | $ | (66,574) | |||||||||||||||
Other comprehensive income (loss) | |||||||||||||||||||||||
Change in net unrealized appreciation on investments | $ | 9,496 | $ | 34,895 | $ | (21,001) | $ | 40,470 | |||||||||||||||
Change in liability for underfunded employee benefit plans | (3,765) | — | 2,740 | — | |||||||||||||||||||
Other comprehensive income, before tax and reclassification adjustments | $ | 5,731 | $ | 34,895 | $ | (18,261) | $ | 40,470 | |||||||||||||||
Income tax effect | (1,202) | (7,329) | 3,835 | (8,499) | |||||||||||||||||||
Other comprehensive income, after tax, before reclassification adjustments | $ | 4,529 | $ | 27,566 | $ | (14,426) | $ | 31,971 | |||||||||||||||
Reclassification adjustment for net realized investment losses included in income | $ | (141) | $ | (80) | $ | 666 | $ | 41 | |||||||||||||||
Reclassification adjustment for employee benefit costs included in expense | 1,645 | 1,072 | 3,312 | 2,144 | |||||||||||||||||||
Total reclassification adjustments, before tax | $ | 1,504 | $ | 992 | $ | 3,978 | $ | 2,185 | |||||||||||||||
Income tax effect | (316) | (207) | (835) | (458) | |||||||||||||||||||
Total reclassification adjustments, after tax | $ | 1,188 | $ | 785 | $ | 3,143 | $ | 1,727 | |||||||||||||||
Comprehensive income (loss) | $ | 19,467 | $ | 34,311 | $ | 21,169 | $ | (32,876) | |||||||||||||||
Diluted weighted average common shares outstanding | 25,416,868 | 25,255,604 | 25,394,728 | 25,019,441 | |||||||||||||||||||
Earnings (loss) per common share: | |||||||||||||||||||||||
Basic | $ | 0.55 | $ | 0.24 | $ | 1.29 | $ | (2.66) | |||||||||||||||
Diluted | 0.54 | 0.24 | 1.28 | (2.66) | |||||||||||||||||||
Common Stock | ||||||||||||||||||||
(In Thousands, Except Share Data) | Shares outstanding | Common stock | Additional paid-in capital | Retaining Earnings | Accumulated other comprehensive income | Total | ||||||||||||||
Balance, January 1, 2021 | 25,055,479 | $ | 25 | $ | 202,359 | $ | 555,854 | $ | 66,911 | $ | 825,149 | |||||||||
Net income | — | — | — | 18,702 | — | 18,702 | ||||||||||||||
Shares repurchased | (207) | — | (7) | — | — | (7) | ||||||||||||||
Stock based compensation | 64,583 | — | 522 | — | — | 522 | ||||||||||||||
Dividends on common stock ($0.15 per share)
|
— | — | — | (3,767) | — | (3,767) | ||||||||||||||
Change in net unrealized investment appreciation(1)
|
— | — | — | — | (23,456) | (23,456) | ||||||||||||||
Change in liability for underfunded employee benefit plans(2)
|
— | — | — | — | 6,456 | 6,456 | ||||||||||||||
Balance, March 31, 2021 | 25,119,855 | $ | 25 | $ | 202,874 | $ | 570,789 | $ | 49,911 | $ | 823,599 | |||||||||
Net income | — | $ | — | $ | — | $ | 13,750 | $ | — | $ | 13,750 | |||||||||
Shares repurchased | (31,027) | — | (1,000) | — | — | (1,000) | ||||||||||||||
Stock based compensation | 28,512 | — | 1,181 | — | — | 1,181 | ||||||||||||||
Dividends on common stock ($0.15 per share)
|
— | — | — | (3,772) | — | (3,772) | ||||||||||||||
Change in net unrealized investment appreciation(1)
|
— | — | — | — | 7,391 | 7,391 | ||||||||||||||
Change in liability for underfunded employee benefit plans(2)
|
— | — | — | — | (1,674) | (1,674) | ||||||||||||||
Balance, June 30, 2021 | 25,117,340 | $ | 25 | $ | 203,055 | $ | 580,767 | $ | 55,628 | $ | 839,475 | |||||||||
Common Stock | ||||||||||||||||||||
(In Thousands, Except Share Data) | Shares outstanding | Common stock | Additional paid-in capital | Retaining Earnings | Accumulated other comprehensive income | Total | ||||||||||||||
Balance, January 1, 2020 | 25,015,963 | $ | 25 | $ | 200,179 | $ | 697,116 | $ | 13,152 | $ | 910,472 | |||||||||
Net income (loss) | — | — | — | (72,534) | — | (72,534) | ||||||||||||||
Shares repurchased | (70,467) | — | (2,741) | — | — | (2,741) | ||||||||||||||
Stock based compensation | 70,597 | — | 879 | — | — | 879 | ||||||||||||||
Dividends on common stock $0.33 per share)
|
— | — | — | (8,249) | — | (8,249) | ||||||||||||||
Change in net unrealized investment appreciation(1)
|
— | — | — | — | 4,500 | 4,500 | ||||||||||||||
Change in liability for underfunded employee benefit plans(2)
|
— | — | — | — | 847 | 847 | ||||||||||||||
Cumulative effect of change in accounting principle | — | — | — | (30) | — | (30) | ||||||||||||||
Balance, March 31, 2020 | 25,016,093 | $ | 25 | $ | 198,317 | $ | 616,303 | $ | 18,499 | $ | 833,144 | |||||||||
Net income | — | $ | — | $ | — | $ | 5,960 | $ | — | $ | 5,960 | |||||||||
Stock based compensation | 15,141 | — | 1,479 | — | — | 1,479 | ||||||||||||||
Dividends on common stock $0.33 per share)
|
— | — | — | (8,267) | — | (8,267) | ||||||||||||||
Change in net unrealized investment appreciation(1)
|
— | — | — | — | 27,504 | 27,504 | ||||||||||||||
Change in liability for underfunded employee benefit plans(2)
|
— | — | — | — | 847 | 847 | ||||||||||||||
Balance, June 30, 2020 | 25,031,234 | $ | 25 | $ | 199,796 | $ | 613,996 | $ | 46,850 | $ | 860,667 | |||||||||
Six Months Ended June 30, | |||||||||||
(In Thousands) | 2021 | 2020 | |||||||||
Cash Flows From Operating Activities | |||||||||||
Net income (loss) | $ | 32,452 | $ | (66,574) | |||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities | |||||||||||
Net accretion of bond premium | 7,203 | 5,501 | |||||||||
Depreciation and amortization | 3,175 | 3,318 | |||||||||
Stock-based compensation expense | 2,115 | 2,927 | |||||||||
Net realized investment (gains) losses | (30,512) | 77,628 | |||||||||
Net cash flows from equity and trading investments | 40,983 | 17,148 | |||||||||
Deferred income tax benefit | 2,582 | (19,229) | |||||||||
Changes in: | |||||||||||
Accrued investment income | 789 | 697 | |||||||||
Premiums receivable | (16,975) | (19,176) | |||||||||
Deferred policy acquisition costs | (9,192) | (3,274) | |||||||||
Reinsurance receivables | 35,755 | (55,512) | |||||||||
Prepaid reinsurance premiums | 614 | (4,956) | |||||||||
Income taxes receivable | 3,926 | (19,184) | |||||||||
Other assets | (10,372) | (9,162) | |||||||||
Losses and loss settlement expenses | (9,678) | 55,935 | |||||||||
Unearned premiums | 9,326 | 25,639 | |||||||||
Accrued expenses and other liabilities | (19,077) | (2,098) | |||||||||
Deferred income taxes | — | 4,184 | |||||||||
Other, net | (8,284) | 10,420 | |||||||||
Cash from operating activities | 2,378 | 70,806 | |||||||||
Net cash provided by operating activities | $ | 34,830 | $ | 4,232 | |||||||
Cash Flows From Investing Activities | |||||||||||
Proceeds from sale of available-for-sale investments | $ | 116,664 | $ | 16,907 | |||||||
Proceeds from call and maturity of available-for-sale investments | 153,567 | 159,709 | |||||||||
Proceeds from sale of other investments | 2,214 | 2,750 | |||||||||
Purchase of investments in mortgage loans | — | (5,323) | |||||||||
Purchase of investments available-for-sale | (255,489) | (117,299) | |||||||||
Purchase of other investments | (4,663) | (3,577) | |||||||||
Net purchases and sales of property and equipment | (7,594) | (12,040) | |||||||||
Net cash provided by investing activities | $ | 4,699 | $ | 41,127 | |||||||
Cash Flows From Financing Activities | |||||||||||
Issuance of common stock | $ | (412) | $ | (562) | |||||||
Repurchase of common stock | (1,007) | (2,741) | |||||||||
Payment of cash dividends | (7,539) | (16,516) | |||||||||
Net cash used in financing activities | $ | (8,958) | $ | (19,819) | |||||||
Net Change in Cash and Cash Equivalents | $ | 30,571 | $ | 25,540 | |||||||
Cash and Cash Equivalents at Beginning of Period | 87,948 | 120,722 | |||||||||
Cash and Cash Equivalents at End of Period | $ | 118,519 | $ | 146,262 |
Total | |||||
Recorded asset at beginning of period | $ | 87,094 | |||
Underwriting costs deferred | 108,464 | ||||
Amortization of deferred policy acquisition costs | (99,272) | ||||
Recorded asset at June 30, 2021
|
$ | 96,286 |
June 30, 2021 | |||||||||||||||||||||||||||||||||||
Type of Investment | Cost or Amortized Cost | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Fair Value | Allowance for Credit Losses | Carrying Value | |||||||||||||||||||||||||||||
AVAILABLE-FOR-SALE | |||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||
Bonds | |||||||||||||||||||||||||||||||||||
U.S. Treasury | $ | 73,072 | $ | 318 | $ | 420 | $ | 72,970 | $ | — | $ | 72,970 | |||||||||||||||||||||||
U.S. government agency | 79,070 | 3,073 | 1,071 | 81,072 | — | 81,072 | |||||||||||||||||||||||||||||
States, municipalities and political subdivisions | |||||||||||||||||||||||||||||||||||
General obligations: | |||||||||||||||||||||||||||||||||||
Midwest | 70,118 | 3,155 | — | 73,273 | — | 73,273 | |||||||||||||||||||||||||||||
Northeast | 28,964 | 1,010 | — | 29,974 | — | 29,974 | |||||||||||||||||||||||||||||
South | 93,271 | 4,694 | — | 97,965 | — | 97,965 | |||||||||||||||||||||||||||||
West | 97,282 | 6,334 | — | 103,616 | — | 103,616 | |||||||||||||||||||||||||||||
Special revenue: | |||||||||||||||||||||||||||||||||||
Midwest | 119,011 | 8,481 | — | 127,492 | — | 127,492 | |||||||||||||||||||||||||||||
Northeast | 56,067 | 4,392 | — | 60,459 | — | 60,459 | |||||||||||||||||||||||||||||
South | 202,317 | 16,266 | 49 | 218,534 | — | 218,534 | |||||||||||||||||||||||||||||
West | 130,229 | 9,225 | — | 139,454 | — | 139,454 | |||||||||||||||||||||||||||||
Foreign bonds | 26,359 | 1,199 | 73 | 27,485 | — | 27,485 | |||||||||||||||||||||||||||||
Public utilities | 95,984 | 5,907 | 88 | 101,803 | — | 101,803 | |||||||||||||||||||||||||||||
Corporate bonds | |||||||||||||||||||||||||||||||||||
Energy | 24,296 | 2,418 | — | 26,714 | — | 26,714 | |||||||||||||||||||||||||||||
Industrials | 52,095 | 3,094 | 76 | 55,113 | — | 55,113 | |||||||||||||||||||||||||||||
Consumer goods and services | 65,280 | 3,221 | 434 | 68,067 | — | 68,067 | |||||||||||||||||||||||||||||
Health care | 28,984 | 704 | 302 | 29,386 | — | 29,386 | |||||||||||||||||||||||||||||
Technology, media and telecommunications | 66,175 | 4,261 | 852 | 69,584 | — | 69,584 | |||||||||||||||||||||||||||||
Financial services | 93,396 | 5,807 | 282 | 98,921 | 170 | 98,751 | |||||||||||||||||||||||||||||
Mortgage-backed securities | 24,800 | 268 | 162 | 24,906 | — | 24,906 | |||||||||||||||||||||||||||||
Collateralized mortgage obligations | |||||||||||||||||||||||||||||||||||
Government national mortgage association | 97,913 | 3,648 | 1,065 | 100,496 | — | 100,496 | |||||||||||||||||||||||||||||
Federal home loan mortgage corporation | 127,051 | 1,398 | 1,086 | 127,363 | — | 127,363 | |||||||||||||||||||||||||||||
Federal national mortgage association | 45,166 | 1,517 | 186 | 46,497 | — | 46,497 | |||||||||||||||||||||||||||||
Asset-backed securities | 319 | 572 | — | 891 | — | 891 | |||||||||||||||||||||||||||||
Total Available-for-Sale Fixed Maturities | $ | 1,697,219 | $ | 90,962 | $ | 6,146 | $ | 1,782,035 | $ | 170 | $ | 1,781,865 | |||||||||||||||||||||||
Short-Term Investments | $ | 800 | $ | 1 | — | $ | 801 | $ | — | $ | 801 | ||||||||||||||||||||||||
Total Available-for-Sale Investments | $ | 1,698,019 | $ | 90,963 | $ | 6,146 | $ | 1,782,836 | $ | 170 | $ | 1,782,666 | |||||||||||||||||||||||
December 31, 2020 | ||||||||||||||||||||||||||||||||
Type of Investment | Cost or Amortized Cost | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Fair Value | Allowance for Credit Losses | Carrying Value | ||||||||||||||||||||||||||
AVAILABLE-FOR-SALE | ||||||||||||||||||||||||||||||||
Fixed maturities: | ||||||||||||||||||||||||||||||||
Bonds | ||||||||||||||||||||||||||||||||
U.S. Treasury | $ | 149,481 | $ | 482 | $ | 25 | $ | 149,938 | $ | — | $ | 149,938 | ||||||||||||||||||||
U.S. government agency | 60,502 | 4,016 | — | 64,518 | — | 64,518 | ||||||||||||||||||||||||||
States, municipalities and political subdivisions | ||||||||||||||||||||||||||||||||
General obligations: | ||||||||||||||||||||||||||||||||
Midwest | 77,933 | 4,047 | — | 81,980 | — | 81,980 | ||||||||||||||||||||||||||
Northeast | 29,071 | 1,379 | — | 30,450 | — | 30,450 | ||||||||||||||||||||||||||
South | 104,522 | 5,448 | — | 109,970 | — | 109,970 | ||||||||||||||||||||||||||
West | 102,590 | 7,431 | — | 110,021 | — | 110,021 | ||||||||||||||||||||||||||
Special revenue: | ||||||||||||||||||||||||||||||||
Midwest | 115,956 | 9,142 | — | 125,098 | — | 125,098 | ||||||||||||||||||||||||||
Northeast | 56,317 | 4,759 | — | 61,076 | — | 61,076 | ||||||||||||||||||||||||||
South | 208,739 | 17,967 | — | 226,706 | — | 226,706 | ||||||||||||||||||||||||||
West | 129,417 | 9,982 | — | 139,399 | — | 139,399 | ||||||||||||||||||||||||||
Foreign bonds | 27,799 | 1,805 | 2 | 29,602 | — | 29,602 | ||||||||||||||||||||||||||
Public utilities | 76,114 | 7,388 | — | 83,502 | — | 83,502 | ||||||||||||||||||||||||||
Corporate bonds | ||||||||||||||||||||||||||||||||
Energy | 22,441 | 2,895 | — | 25,336 | — | 25,336 | ||||||||||||||||||||||||||
Industrials | 39,513 | 3,744 | — | 43,257 | — | 43,257 | ||||||||||||||||||||||||||
Consumer goods and services | 46,521 | 4,046 | — | 50,567 | — | 50,567 | ||||||||||||||||||||||||||
Health care | 6,678 | 898 | — | 7,576 | — | 7,576 | ||||||||||||||||||||||||||
Technology, media and telecommunications | 37,270 | 4,381 | 15 | 41,636 | — | 41,636 | ||||||||||||||||||||||||||
Financial services | 93,736 | 7,564 | 269 | 101,031 | 5 | 101,026 | ||||||||||||||||||||||||||
Mortgage-backed securities | 20,305 | 326 | 54 | 20,577 | — | 20,577 | ||||||||||||||||||||||||||
Collateralized mortgage obligations | ||||||||||||||||||||||||||||||||
Government national mortgage association | 81,758 | 4,439 | 45 | 86,152 | — | 86,152 | ||||||||||||||||||||||||||
Federal home loan mortgage corporation | 151,362 | 2,239 | 758 | 152,843 | — | 152,843 | ||||||||||||||||||||||||||
Federal national mortgage association | 81,952 | 2,013 | 683 | 83,282 | — | 83,282 | ||||||||||||||||||||||||||
Asset-backed securities | 314 | 612 | — | 926 | — | 926 | ||||||||||||||||||||||||||
Total Available-for-Sale Fixed Maturities | $ | 1,720,291 | $ | 107,003 | $ | 1,851 | $ | 1,825,443 | $ | 5 | $ | 1,825,438 |
Maturities | |||||||||||||||||||||||
Available-For-Sale | |||||||||||||||||||||||
June 30, 2021 | Amortized Cost | Fair Value | |||||||||||||||||||||
Due in one year or less | $ | 36,922 | $ | 37,394 | |||||||||||||||||||
Due after one year through five years | 482,542 | 508,398 | |||||||||||||||||||||
Due after five years through 10 years | 364,841 | 386,365 | |||||||||||||||||||||
Due after 10 years | 517,665 | 549,725 | |||||||||||||||||||||
Asset-backed securities | 319 | 891 | |||||||||||||||||||||
Mortgage-backed securities | 24,800 | 24,906 | |||||||||||||||||||||
Collateralized mortgage obligations | 270,130 | 274,356 | |||||||||||||||||||||
$ | 1,697,219 | $ | 1,782,035 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Net realized investment gains (losses): | |||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||
Available-for-sale | $ | 136 | $ | 30 | $ | (501) | $ | — | |||||||||||||||
Allowance for credit losses | 5 | 49 | (165) | (10) | |||||||||||||||||||
Trading Securities | — | 1,296 | — | (1,162) | |||||||||||||||||||
Equity securities | |||||||||||||||||||||||
Change in the fair value | 1,245 | 29,809 | 21,827 | (60,838) | |||||||||||||||||||
Sales | 4,618 | (15,406) | 9,351 | (15,586) | |||||||||||||||||||
Mortgage loans allowance for credit losses | — | 1 | — | (4) | |||||||||||||||||||
Real estate | — | — | — | (28) | |||||||||||||||||||
Total net realized investment gains (losses) | $ | 6,004 | $ | 15,779 | $ | 30,512 | $ | (77,628) |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Proceeds from sales | $ | 16,982 | $ | 4,996 | $ | 116,664 | $ | 16,907 | |||||||||||||||
Gross realized gains | 152 | 26 | 153 | 198 | |||||||||||||||||||
Gross realized losses | 17 | 113 | 655 | 495 |
Six Months Ended June 30, | |||||||||||
2021 | 2020 | ||||||||||
Change in net unrealized investment appreciation | |||||||||||
Available-for-sale fixed maturities | $ | (20,335) | $ | 40,511 | |||||||
Income tax effect | 4,270 | (8,507) | |||||||||
Total change in net unrealized investment appreciation, net of tax | $ | (16,065) | $ | 32,004 |
June 30, 2021 | Less than 12 months | 12 months or longer | Total | ||||||||||||||||||||||||||||||||||||||||||||
Type of Investment |
Number
of Issues |
Fair
Value |
Gross Unrealized
Depreciation |
Number
of Issues |
Fair
Value |
Gross Unrealized Depreciation |
Fair
Value |
Gross Unrealized Depreciation | |||||||||||||||||||||||||||||||||||||||
AVAILABLE-FOR-SALE | |||||||||||||||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||||||||||||||
Bonds | |||||||||||||||||||||||||||||||||||||||||||||||
U.S. Treasury | 7 | $ | 45,079 | $ | 420 | — | $ | — | $ | — | $ | 45,079 | $ | 420 | |||||||||||||||||||||||||||||||||
U.S. government agency | 4 | 28,498 | 1,071 | — | — | — | 28,498 | 1,071 | |||||||||||||||||||||||||||||||||||||||
States, municipalities and political subdivisions | |||||||||||||||||||||||||||||||||||||||||||||||
General obligations | |||||||||||||||||||||||||||||||||||||||||||||||
South | 1 | 1,224 | 49 | — | — | — | 1,224 | 49 | |||||||||||||||||||||||||||||||||||||||
Foreign bonds | 2 | 2,930 | 73 | — | — | — | 2,930 | 73 | |||||||||||||||||||||||||||||||||||||||
Public utilities | 5 | 13,513 | 88 | — | — | — | 13,513 | 88 | |||||||||||||||||||||||||||||||||||||||
Corporate bonds | |||||||||||||||||||||||||||||||||||||||||||||||
Industrials | 2 | 5,977 | 76 | — | — | — | 5,977 | 76 | |||||||||||||||||||||||||||||||||||||||
Consumer goods and services | 6 | 16,690 | 434 | — | — | — | 16,690 | 434 | |||||||||||||||||||||||||||||||||||||||
Health care | 2 | 18,936 | 302 | — | — | — | 18,936 | 302 | |||||||||||||||||||||||||||||||||||||||
Technology, media and telecommunications | 5 | 16,198 | 853 | — | — | — | 16,198 | 853 | |||||||||||||||||||||||||||||||||||||||
Financial services | 3 | 6,497 | 26 | — | — | — | 6,497 | 26 | |||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities | 6 | 16,879 | 163 | — | — | — | 16,879 | 163 | |||||||||||||||||||||||||||||||||||||||
Collateralized mortgage obligations | |||||||||||||||||||||||||||||||||||||||||||||||
Federal home loan mortgage corporation | 21 | 82,021 | 1,076 | 1 | 880 | 10 | 82,901 | 1,086 | |||||||||||||||||||||||||||||||||||||||
Federal national mortgage association | 8 | 16,727 | 162 | 1 | 1,359 | 24 | 18,086 | 186 | |||||||||||||||||||||||||||||||||||||||
Government national mortgage association | 5 | 22,329 | 1,065 | — | — | — | 22,329 | 1,065 | |||||||||||||||||||||||||||||||||||||||
Total Available-for-Sale Fixed Maturities | 77 | $ | 293,498 | $ | 5,858 | 2 | $ | 2,239 | $ | 34 | $ | 295,737 | $ | 5,892 |
December 31, 2020 | Less than 12 months | 12 months or longer | Total | ||||||||||||||||||||||||||||||||||||||||||||
Type of Investment |
Number
of Issues |
Fair
Value |
Gross Unrealized Depreciation |
Number
of Issues |
Fair
Value |
Gross Unrealized Depreciation |
Fair
Value |
Gross Unrealized Depreciation | |||||||||||||||||||||||||||||||||||||||
AVAILABLE-FOR-SALE | |||||||||||||||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||||||||||||||
Bonds | |||||||||||||||||||||||||||||||||||||||||||||||
U.S. Treasury | 5 | $ | 86,371 | $ | 25 | — | $ | — | $ | — | $ | 86,371 | $ | 25 | |||||||||||||||||||||||||||||||||
Foreign bonds | 1 | 2,000 | 2 | — | — | — | 2,000 | 2 | |||||||||||||||||||||||||||||||||||||||
Technology, media and telecommunications | 1 | 2,020 | 15 | — | — | — | 2,020 | 15 | |||||||||||||||||||||||||||||||||||||||
Financial services | 1 | 2,995 | 5 | 1 | 3,000 | 7 | 5,995 | 12 | |||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities | 2 | 8,099 | 53 | 5 | 118 | 1 | 8,217 | 54 | |||||||||||||||||||||||||||||||||||||||
Collateralized mortgage obligations | |||||||||||||||||||||||||||||||||||||||||||||||
Federal home loan mortgage corporation | 24 | 97,691 | 758 | 1 | 26 | — | 97,717 | 758 | |||||||||||||||||||||||||||||||||||||||
Federal national mortgage association | 10 | 44,677 | 683 | — | — | — | 44,677 | 683 | |||||||||||||||||||||||||||||||||||||||
Government national mortgage association | 2 | 12,394 | 45 | 1 | 24 | — | 12,418 | 45 | |||||||||||||||||||||||||||||||||||||||
Total Available-for-Sale Fixed Maturities | 46 | $ | 256,247 | $ | 1,586 | 8 | $ | 3,168 | $ | 8 | $ | 259,415 | $ | 1,594 |
June 30, 2021 | December 31, 2020 | ||||||||||||||||||||||
Fair Value | Carrying Value | Fair Value | Carrying Value | ||||||||||||||||||||
Assets | |||||||||||||||||||||||
Investments | |||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||
Available-for-sale securities | $ | 1,782,035 | $ | 1,781,865 | $ | 1,825,443 | $ | 1,825,438 | |||||||||||||||
Equity securities | 196,880 | 196,880 | 206,685 | 206,685 | |||||||||||||||||||
Mortgage loans | 49,464 | 47,373 | 48,932 | 47,614 | |||||||||||||||||||
Other long-term investments | 80,326 | 80,326 | 69,305 | 69,305 | |||||||||||||||||||
Short-term investments | 801 | 801 | 175 | 175 | |||||||||||||||||||
Cash and cash equivalents | 118,519 | 118,519 | 87,948 | 87,948 | |||||||||||||||||||
Corporate-owned life insurance | 9,567 | 9,567 | 8,557 | 8,557 | |||||||||||||||||||
Liabilities | |||||||||||||||||||||||
Long Term Debt | 47,584 | 50,000 | 50,000 | 50,000 |
June 30, 2021 | Fair Value Measurements | ||||||||||||||||||||||
Description | Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||||
AVAILABLE-FOR-SALE | |||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||
Bonds | |||||||||||||||||||||||
U.S. Treasury | $ | 72,970 | $ | — | $ | 72,970 | $ | — | |||||||||||||||
U.S. government agency | 81,072 | — | 81,072 | — | |||||||||||||||||||
States, municipalities and political subdivisions | |||||||||||||||||||||||
General obligations | |||||||||||||||||||||||
Midwest | 73,273 | — | 73,273 | — | |||||||||||||||||||
Northeast | 29,974 | — | 29,974 | — | |||||||||||||||||||
South | 97,965 | — | 97,965 | — | |||||||||||||||||||
West | 103,616 | — | 103,616 | — | |||||||||||||||||||
Special revenue | |||||||||||||||||||||||
Midwest | 127,492 | — | 127,492 | — | |||||||||||||||||||
Northeast | 60,459 | — | 60,459 | — | |||||||||||||||||||
South | 218,534 | — | 218,534 | — | |||||||||||||||||||
West | 139,454 | — | 139,454 | — | |||||||||||||||||||
Foreign bonds | 27,485 | — | 27,485 | — | |||||||||||||||||||
Public utilities | 101,803 | — | 101,803 | — | |||||||||||||||||||
Corporate bonds | |||||||||||||||||||||||
Energy | 26,714 | — | 26,714 | — | |||||||||||||||||||
Industrials | 55,113 | — | 55,113 | — | |||||||||||||||||||
Consumer goods and services | 68,067 | — | 68,067 | — | |||||||||||||||||||
Health care | 29,386 | — | 29,386 | — | |||||||||||||||||||
Technology, media and telecommunications | 69,584 | — | 69,584 | — | |||||||||||||||||||
Financial services | 98,921 | — | 98,771 | 150 | |||||||||||||||||||
Mortgage-backed securities | 24,906 | — | 24,906 | — | |||||||||||||||||||
Collateralized mortgage obligations | |||||||||||||||||||||||
Government national mortgage association | 100,496 | — | 100,496 | — | |||||||||||||||||||
Federal home loan mortgage corporation | 127,363 | — | 127,363 | — | |||||||||||||||||||
Federal national mortgage association | 46,497 | — | 46,497 | — | |||||||||||||||||||
Asset-backed securities | 891 | — | — | 891 | |||||||||||||||||||
Total Available-for-Sale Fixed Maturities | $ | 1,782,035 | $ | — | $ | 1,780,994 | $ | 1,041 | |||||||||||||||
EQUITY SECURITIES | |||||||||||||||||||||||
Common stocks | |||||||||||||||||||||||
Public utilities | $ | 16,911 | $ | 16,911 | $ | — | $ | — | |||||||||||||||
Energy | 10,548 | 10,548 | — | — | |||||||||||||||||||
Industrials | 36,940 | 36,940 | — | — | |||||||||||||||||||
Consumer goods and services | 48,541 | 48,541 | — | — | |||||||||||||||||||
Health care | 16,551 | 16,551 | — | — | |||||||||||||||||||
Technology, media and telecommunications | 26,786 | 26,786 | — | — |
Financial services | 40,008 | 40,008 | — | — | |||||||||||||||||||
Nonredeemable preferred stocks | 595 | — | — | 595 | |||||||||||||||||||
Total Equity Securities | $ | 196,880 | $ | 196,285 | $ | — | $ | 595 | |||||||||||||||
Short-Term Investments | $ | 801 | $ | 801 | $ | — | $ | — | |||||||||||||||
Money Market Accounts | $ | 25,261 | $ | 25,261 | $ | — | $ | — | |||||||||||||||
Corporate-Owned Life Insurance | $ | 9,567 | $ | — | $ | 9,567 | $ | — | |||||||||||||||
Total Assets Measured at Fair Value | $ | 2,014,544 | $ | 222,347 | $ | 1,790,561 | $ | 1,636 |
December 31, 2020 | Fair Value Measurements | ||||||||||||||||||||||
Description | Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||||
AVAILABLE-FOR-SALE | |||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||
Bonds | |||||||||||||||||||||||
U.S. Treasury | $ | 149,938 | $ | — | $ | 149,938 | $ | — | |||||||||||||||
U.S. government agency | 64,518 | — | 64,518 | — | |||||||||||||||||||
States, municipalities and political subdivisions | |||||||||||||||||||||||
General obligations | |||||||||||||||||||||||
Midwest | 81,980 | — | 81,980 | — | |||||||||||||||||||
Northeast | 30,450 | — | 30,450 | — | |||||||||||||||||||
South | 109,970 | — | 109,970 | — | |||||||||||||||||||
West | 110,021 | — | 110,021 | — | |||||||||||||||||||
Special revenue | |||||||||||||||||||||||
Midwest | 125,098 | — | 125,098 | — | |||||||||||||||||||
Northeast | 61,076 | — | 61,076 | — | |||||||||||||||||||
South | 226,706 | — | 226,706 | — | |||||||||||||||||||
West | 139,399 | — | 139,399 | — | |||||||||||||||||||
Foreign bonds | 29,602 | — | 29,602 | — | |||||||||||||||||||
Public utilities | 83,502 | — | 83,502 | — | |||||||||||||||||||
Corporate bonds | |||||||||||||||||||||||
Energy | 25,336 | — | 25,336 | — | |||||||||||||||||||
Industrials | 43,257 | — | 43,257 | — | |||||||||||||||||||
Consumer goods and services | 50,567 | — | 50,567 | — | |||||||||||||||||||
Health care | 7,576 | — | 7,576 | — | |||||||||||||||||||
Technology, media and telecommunications | 41,636 | — | 41,636 | — | |||||||||||||||||||
Financial services | 101,031 | — | 100,781 | 250 | |||||||||||||||||||
Mortgage-backed securities | 20,577 | — | 20,577 | — | |||||||||||||||||||
Collateralized mortgage obligations | |||||||||||||||||||||||
Government national mortgage association | 86,152 | — | 86,152 | — | |||||||||||||||||||
Federal home loan mortgage corporation | 152,843 | — | 152,843 | — | |||||||||||||||||||
Federal national mortgage association | 83,282 | — | 83,282 | — | |||||||||||||||||||
Asset-backed securities | 926 | — | — | 926 | |||||||||||||||||||
Total Available-for-Sale Fixed Maturities | $ | 1,825,443 | $ | — | $ | 1,824,267 | $ | 1,176 | |||||||||||||||
EQUITY SECURITIES |
Common stocks | |||||||||||||||||||||||
Public utilities | $ | 16,320 | $ | 16,320 | $ | — | $ | — | |||||||||||||||
Energy | 9,918 | 9,918 | — | — | |||||||||||||||||||
Industrials | 36,556 | 36,556 | — | — | |||||||||||||||||||
Consumer goods and services | 32,061 | 32,061 | — | — | |||||||||||||||||||
Health care | 24,549 | 24,549 | — | — | |||||||||||||||||||
Technology, media and telecommunications | 17,109 | 17,109 | — | — | |||||||||||||||||||
Financial services | 69,577 | 69,577 | — | — | |||||||||||||||||||
Nonredeemable preferred stocks | 595 | — | — | 595 | |||||||||||||||||||
Total Equity Securities | $ | 206,685 | $ | 206,090 | $ | — | $ | 595 | |||||||||||||||
Short-Term Investments | $ | 175 | $ | 175 | $ | — | $ | — | |||||||||||||||
Money Market Accounts | $ | 24,790 | $ | 24,790 | $ | — | $ | — | |||||||||||||||
Corporate-Owned Life Insurance | $ | 8,557 | $ | — | $ | 8,557 | $ | — | |||||||||||||||
Total Assets Measured at Fair Value | $ | 2,065,650 | $ | 231,055 | $ | 1,832,824 | $ | 1,771 |
Quantitative Information about Level 3 Fair Value Measurements | ||||||||||||||||||||||||||
Fair Value at | Valuation Technique(s) | Unobservable inputs | Range of weighted average significant unobservable inputs | |||||||||||||||||||||||
June 30, 2021 | ||||||||||||||||||||||||||
Corporate bonds - financial services | $ | 150 | Fair value equals cost | NA | NA | |||||||||||||||||||||
Fixed Maturities asset-backed securities | 891 | Discounted cash flow | Probability of default |
4% - 6%
|
||||||||||||||||||||||
Nonredeemable preferred stocks | 595 | Discounted cash flow | Multiplier |
3x - 4x
|
Corporate bonds | Asset-backed securities | Equities | Total | ||||||||||||||||||||||||||||||||||||||
Balance at April 1, 2021 | $ | 150 | $ | 848 | $ | 595 | $ | 1,593 | |||||||||||||||||||||||||||||||||
Net unrealized gains (losses)(1)
|
— | 43 | — | 43 | |||||||||||||||||||||||||||||||||||||
Balance at June 30, 2021 | $ | 150 | $ | 891 | $ | 595 | $ | 1,636 |
Corporate bonds | Asset-backed securities | Equities | Total | |||||||||||||||||||||||
Balance at January 1, 2021 | $ | 250 | $ | 926 | $ | 595 | $ | 1,771 | ||||||||||||||||||
Net unrealized gains (losses)(1)
|
— | (35) | — | (35) | ||||||||||||||||||||||
Transfers out | (100) | — | — | (100) | ||||||||||||||||||||||
Balance at June 30, 2021 | $ | 150 | $ | 891 | $ | 595 | $ | 1,636 |
Commercial Mortgage Loans | |||||||||||
June 30, 2021 | December 31, 2020 | ||||||||||
Loan-to-value | Carrying Value | Carrying Value | |||||||||
Less than 65% | $ | 30,145 | $ | 30,361 | |||||||
65%-75% | 17,304 | 17,329 | |||||||||
Total amortized cost | $ | 47,449 | $ | 47,690 | |||||||
Allowance for mortgage loan losses | (76) | (76) | |||||||||
Mortgage loans, net | $ | 47,373 | $ | 47,614 |
Mortgage Loans by Region | |||||||||||||||||||||||
June 30, 2021 | December 31, 2020 | ||||||||||||||||||||||
Carrying Value | Percent of Total | Carrying Value | Percent of Total | ||||||||||||||||||||
East North Central | $ | 3,245 | 6.8 | % | $ | 3,245 | 6.8 | % | |||||||||||||||
Southern Atlantic | 9,666 | 20.4 | 9,752 | 20.5 | |||||||||||||||||||
East South Central | 8,114 | 17.1 | 8,197 | 17.2 | |||||||||||||||||||
New England | 6,588 | 13.9 | 6,588 | 13.8 | |||||||||||||||||||
Middle Atlantic | 14,863 | 31.3 | 14,936 | 31.2 | |||||||||||||||||||
Mountain | 2,227 | 4.7 | 2,227 | 4.7 | |||||||||||||||||||
West North Central | 2,746 | 5.8 | 2,745 | 5.8 | |||||||||||||||||||
Total mortgage loans at amortized cost | $ | 47,449 | 100.0 | % | $ | 47,690 | 100.0 | % |
Mortgage Loans by Property Type | |||||||||||||||||||||||
June 30, 2021 | December 31, 2020 | ||||||||||||||||||||||
Carrying Value | Percent of Total | Carrying Value | Percent of Total | ||||||||||||||||||||
Commercial | |||||||||||||||||||||||
Multifamily | $ | 17,012 | 35.9 | % | $ | 17,038 | 35.7 | % | |||||||||||||||
Office | 11,718 | 24.7 | 11,861 | 24.9 | |||||||||||||||||||
Industrial
|
10,125 | 21.3 | 10,124 | 21.2 | |||||||||||||||||||
Retail
|
2,227 | 4.7 | 2,227 | 4.7 | |||||||||||||||||||
Mixed use/Other
|
6,367 | 13.4 | 6,440 | 13.5 | |||||||||||||||||||
Total mortgage loans at amortized cost | $ | 47,449 | 100.0 | % | $ | 47,690 | 100.0 | % |
Amortized Cost Basis by Year of Origination and Credit Quality Indicator | ||||||||||||||||||||||||||||||||
2021 | 2020 | 2019 | 2018 | Total | ||||||||||||||||||||||||||||
Commercial mortgage loans: | ||||||||||||||||||||||||||||||||
Risk Rating: | ||||||||||||||||||||||||||||||||
1-2 internal grade | $ | — | $ | 5,509 | $ | 8,369 | $ | 18,487 | $ | 32,365 | ||||||||||||||||||||||
3-4 internal grade | — | — | 8,496 | 6,588 | 15,084 | |||||||||||||||||||||||||||
5 internal grade | — | — | — | — | — | |||||||||||||||||||||||||||
6 internal grade | — | — | — | — | — | |||||||||||||||||||||||||||
7 internal grade | — | — | — | — | — | |||||||||||||||||||||||||||
Total commercial mortgage loans | $ | — | $ | 5,509 | $ | 16,865 | $ | 25,075 | $ | 47,449 | ||||||||||||||||||||||
Current-period write-offs | — | — | — | — | — | |||||||||||||||||||||||||||
Current-period recoveries | — | — | — | — | — | |||||||||||||||||||||||||||
Current-period net write-offs | $ | — | $ | — | $ | — | $ | — | $ | — |
Rollforward of allowance for mortgage loan losses: | ||||||||
As of | ||||||||
June 30, 2021 | ||||||||
Beginning balance, January 1, 2021 | $ | 76 | ||||||
Current-period provision for expected credit losses | — | |||||||
Ending balance of the allowance for mortgage loan losses, June 30, 2021
|
$ | 76 |
June 30, 2021 | December 31, 2020 | ||||||||||
Gross liability for losses and loss settlement expenses
at beginning of year |
$ | 1,578,131 | $ | 1,421,754 | |||||||
Ceded losses and loss settlement expenses | (131,843) | (68,536) | |||||||||
Net liability for losses and loss settlement expenses
at beginning of year |
$ | 1,446,288 | $ | 1,353,218 | |||||||
Losses and loss settlement expenses incurred
for claims occurring during |
|||||||||||
Current year | $ | 373,561 | $ | 887,119 | |||||||
Prior years | (15,024) | (17,652) | |||||||||
Total incurred | $ | 358,537 | $ | 869,467 | |||||||
Losses and loss settlement expense payments
for claims occurring during |
|||||||||||
Current year | $ | 116,385 | $ | 354,635 | |||||||
Prior years | 234,863 | 421,762 | |||||||||
Total paid | $ | 351,248 | $ | 776,397 | |||||||
Net liability for losses and loss settlement expenses
at end of year |
$ | 1,453,577 | $ | 1,446,288 | |||||||
Ceded loss and loss settlement expenses | 114,876 | 131,843 | |||||||||
Gross liability for losses and loss settlement expenses
at end of period |
$ | 1,568,453 | $ | 1,578,131 |
Pension Plan | Postretirement Benefit Plan | ||||||||||||||||||||||
Three Months Ended June 30, | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||
Net periodic benefit cost | |||||||||||||||||||||||
Service cost | $ | 3,020 | $ | 2,707 | $ | — | $ | 432 | |||||||||||||||
Interest cost | 1,728 | 2,066 | 1 | 253 | |||||||||||||||||||
Expected return on plan assets | (4,202) | (3,385) | — | — | |||||||||||||||||||
Amortization of prior service credit | (809) | — | (3,765) | (2,021) | |||||||||||||||||||
Amortization of net loss | 999 | 979 | 705 | 94 | |||||||||||||||||||
Special event plan closure | — | — | — | — | |||||||||||||||||||
Net periodic benefit cost | $ | 736 | $ | 2,367 | $ | (3,059) | $ | (1,242) |
Pension Plan | Postretirement Benefit Plan | ||||||||||||||||||||||
Six Months Ended June 30, | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||
Net periodic benefit cost | |||||||||||||||||||||||
Service cost | $ | 6,040 | $ | 5,414 | $ | 148 | $ | 864 | |||||||||||||||
Interest cost | 3,456 | 4,132 | 70 | 506 | |||||||||||||||||||
Expected return on plan assets | (8,404) | (6,770) | — | — | |||||||||||||||||||
Amortization of prior service credit | (1,618) | — | (6,962) | (4,042) | |||||||||||||||||||
Amortization of net loss | 1,998 | 1,958 | 1,197 | 188 | |||||||||||||||||||
Special event plan closure | — | — | (20,177) | — | |||||||||||||||||||
Net periodic benefit cost | $ | 1,472 | $ | 4,734 | $ | (25,724) | $ | (2,484) |
Authorized Shares Available for Future Award Grants | Six Months Ended June 30, 2021 |
From Inception to June 30, 2021
|
|||||||||
Beginning balance | 700,680 | 1,900,000 | |||||||||
Additional shares authorized | 650,000 | 2,150,000 | |||||||||
Number of awards granted | (160,357) | (3,449,256) | |||||||||
Number of awards forfeited or expired | 44,378 | 633,957 | |||||||||
Ending balance | 1,234,701 | 1,234,701 | |||||||||
Number of option awards exercised | 7,884 | 1,481,973 | |||||||||
Number of unrestricted stock awards granted | — | 10,090 | |||||||||
Number of restricted stock awards vested | 52,302 | 216,680 |
Authorized Shares Available for Future Award Grants | Six Months Ended June 30, 2021 |
From Inception to June 30, 2021
|
|||||||||
Beginning balance | 160,135 | 300,000 | |||||||||
Additional authorization | — | 150,000 | |||||||||
Number of awards granted | (18,510) | (332,378) | |||||||||
Number of awards forfeited or expired | 2,727 | 26,730 | |||||||||
Ending balance | 144,352 | 144,352 | |||||||||
Number of option awards exercised | 8,181 | 142,001 | |||||||||
Number of restricted stock awards vested | — | 98,491 |
2021 | $ | 1,952 | ||||||
2022 | 2,414 | |||||||
2023 | 318 | |||||||
2024 | — | |||||||
2025 | — | |||||||
Total | $ | 4,684 |
Three Months Ended June 30, | |||||||||||||||||||||||
(In Thousands, Except Share Data) | 2021 | 2020 | |||||||||||||||||||||
Basic | Diluted | Basic | Diluted | ||||||||||||||||||||
Net income | $ | 13,750 | $ | 13,750 | $ | 5,960 | $ | 5,960 | |||||||||||||||
Weighted-average common shares outstanding | 25,109,048 | 25,109,048 | 25,024,855 | 25,024,855 | |||||||||||||||||||
Add dilutive effect of restricted stock unit awards | — | 219,700 | — | 213,203 | |||||||||||||||||||
Add dilutive effect of stock options | — | 88,120 | — | 17,546 | |||||||||||||||||||
Weighted-average common shares outstanding | 25,109,048 | 25,416,868 | 25,024,855 | 25,255,604 | |||||||||||||||||||
Earnings per common share | $ | 0.55 | $ | 0.54 | $ | 0.24 | $ | 0.24 | |||||||||||||||
Awards excluded from diluted earnings per share calculation(1)
|
— | 515,984 | — | 815,279 |
Six Months Ended June 30, | |||||||||||||||||||||||
(In Thousands, Except Share Data) | 2021 | 2020 | |||||||||||||||||||||
Basic | Diluted | Basic | Diluted | ||||||||||||||||||||
Net income (loss) | $ | 32,452 | $ | 32,452 | $ | (66,574) | $ | (66,574) | |||||||||||||||
Weighted-average common shares outstanding | 25,097,545 | 25,097,545 | 25,019,441 | 25,019,441 | |||||||||||||||||||
Add dilutive effect of restricted stock unit awards | — | 219,700 | — | — | |||||||||||||||||||
Add dilutive effect of stock options | — | 77,483 | — | — | |||||||||||||||||||
Weighted-average common shares outstanding | 25,097,545 | 25,394,728 | 25,019,441 | 25,019,441 | |||||||||||||||||||
Earnings (loss) per common share | $ | 1.29 | $ | 1.28 | $ | (2.66) | $ | (2.66) | |||||||||||||||
Awards excluded from diluted earnings per share calculation(1)
|
— | 515,984 | — | 515,984 |
A.M. Best Co. Financial Strength Rating | Applicable Interest Rate | ||||
A+ | 5.875% | ||||
A | 6.375% | ||||
A- | 6.875% | ||||
B++ (or lower) | 7.375% |
Liability for | |||||||||||||||||
Net unrealized | underfunded | ||||||||||||||||
appreciation | employee | ||||||||||||||||
on investments |
benefit costs(1)
|
Total | |||||||||||||||
Balance as of March 31, 2021
|
59,614 | (9,703) | $ | 49,911 | |||||||||||||
Change in accumulated other comprehensive income before reclassifications | 7,503 | (2,974) | 4,529 | ||||||||||||||
Reclassification adjustments from accumulated other comprehensive income (loss) | (112) | 1,300 | 1,188 | ||||||||||||||
Balance as of June 30, 2021
|
$ | 67,005 | $ | (11,377) | $ | 55,628 |
Liability for | |||||||||||||||||
Net unrealized | underfunded | ||||||||||||||||
appreciation | employee | ||||||||||||||||
on investments |
benefit costs(1)
|
Total | |||||||||||||||
Balance as of January 1, 2021
|
83,070 | (16,159) | $ | 66,911 | |||||||||||||
Change in accumulated other comprehensive income before reclassifications | (16,591) | 2,165 | (14,426) | ||||||||||||||
Reclassification adjustments from accumulated other comprehensive income (loss) | 526 | 2,617 | 3,143 | ||||||||||||||
Balance as of June 30, 2021
|
$ | 67,005 | $ | (11,377) | $ | 55,628 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||
Components of lease expense: | ||||||||||||||||||||||||||
Operating lease expense | $ | 1,767 | $ | 1,926 | $ | 3,549 | $ | 3,956 | ||||||||||||||||||
Less sublease income | 53 | 63 | 107 | 186 | ||||||||||||||||||||||
Net lease expense | 1,714 | 1,863 | 3,442 | 3,770 | ||||||||||||||||||||||
Cash flows information related to leases: | ||||||||||||||||||||||||||
Operating cash outflow from operating leases | 1,731 | 1,829 | 3,478 | 3,469 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||
(In Thousands, Except Ratios) | 2021 | 2020 | % | 2021 | 2020 | % | |||||||||||||||||||||||||||||
Revenues | |||||||||||||||||||||||||||||||||||
Net premiums earned | $ | 224,703 | $ | 263,609 | (14.8) | % | $ | 483,928 | $ | 532,458 | (9.1) | % | |||||||||||||||||||||||
Investment income, net of investment expenses | 13,795 | 12,696 | 8.7 | 30,876 | 15,059 | 105.0 | |||||||||||||||||||||||||||||
Net realized investment gains (losses) | 6,004 | 15,779 | (61.9) | 30,512 | (77,628) | (139.3) | |||||||||||||||||||||||||||||
Other income | (90) | 5,719 | NM | (169) | 5,719 | NM | |||||||||||||||||||||||||||||
Total revenues | $ | 244,412 | $ | 297,803 | (17.9) | % | $ | 545,147 | $ | 475,608 | 14.6 | % | |||||||||||||||||||||||
Benefits, Losses and Expenses | |||||||||||||||||||||||||||||||||||
Losses and loss settlement expenses | $ | 152,139 | $ | 204,973 | (25.8) | % | $ | 358,537 | $ | 391,476 | (8.4) | % | |||||||||||||||||||||||
Amortization of deferred policy acquisition costs | 46,007 | 51,893 | (11.3) | 99,272 | 106,345 | (6.7) | |||||||||||||||||||||||||||||
Other underwriting expenses | 28,400 | 36,701 | (22.6) | 46,768 | 78,550 | (40.5) | |||||||||||||||||||||||||||||
Interest expense | 1,594 | — | NM | 1,594 | — | NM | |||||||||||||||||||||||||||||
Total benefits, losses and expenses | $ | 228,140 | $ | 293,567 | (22.3) | % | $ | 506,171 | $ | 576,371 | (12.2) | % | |||||||||||||||||||||||
Income (loss) before income taxes | $ | 16,272 | $ | 4,236 | 284.1 | % | $ | 38,976 | $ | (100,763) | (138.7) | ||||||||||||||||||||||||
Federal income tax expense (benefit) | 2,522 | (1,724) | (246.3) | 6,524 | (34,189) | (119.1) | |||||||||||||||||||||||||||||
Net income (loss) | $ | 13,750 | $ | 5,960 | 130.7 | $ | 32,452 | $ | (66,574) | (148.7) | % | ||||||||||||||||||||||||
GAAP Ratios: | |||||||||||||||||||||||||||||||||||
Net loss ratio (without catastrophes) | 58.1 | % | 58.6 | % | (0.9) | % | 63.6 | % | 61.1 | % | 4.1 | % | |||||||||||||||||||||||
Catastrophes - effect on net loss ratio | 9.6 | 19.2 | (50.0) | 10.5 | 12.4 | (15.3) | |||||||||||||||||||||||||||||
Net loss ratio(1)
|
67.7 | % | 77.8 | % | (13.0) | % | 74.1 | % | 73.5 | % | 0.8 | % | |||||||||||||||||||||||
Expense ratio(2)
|
33.1 | 33.6 | (1.5) | 30.2 | 34.7 | (13.0) | |||||||||||||||||||||||||||||
Combined ratio(3)
|
100.8 | % | 111.4 | % | (9.5) | % | 104.3 | % | 108.2 | % | (3.6) | % |
Three Months Ended June 30, | 2021 | 2020 | |||||||||||||||||||||||||||||||||
Net Losses | Net Losses | ||||||||||||||||||||||||||||||||||
and Loss | and Loss | ||||||||||||||||||||||||||||||||||
Net | Settlement | Net | Net | Settlement | Net | ||||||||||||||||||||||||||||||
(In Thousands, Except Ratios) | Premiums | Expenses | Loss | Premiums | Expenses | Loss | |||||||||||||||||||||||||||||
Unaudited | Earned | Incurred | Ratio | Earned | Incurred | Ratio | |||||||||||||||||||||||||||||
Commercial lines | |||||||||||||||||||||||||||||||||||
Other liability | $ | 74,654 | $ | 44,723 | 59.9 | % | $ | 77,407 | $ | 46,914 | 60.6 | % | |||||||||||||||||||||||
Fire and allied lines | 58,277 | 42,203 | 72.4 | 62,592 | 67,055 | 107.1 | |||||||||||||||||||||||||||||
Automobile | 63,270 | 42,396 | 67.0 | 73,682 | 58,014 | 78.7 | |||||||||||||||||||||||||||||
Workers' compensation | 15,575 | 14,556 | 93.5 | 19,200 | 6,247 | 32.5 | |||||||||||||||||||||||||||||
Fidelity and surety | 7,137 | 1,012 | 14.2 | 6,332 | 110 | 1.7 | |||||||||||||||||||||||||||||
Miscellaneous | 335 | 16 | 4.8 | 385 | 96 | 24.9 | |||||||||||||||||||||||||||||
Total commercial lines | $ | 219,248 | $ | 144,906 | 66.1 | % | $ | 239,598 | $ | 178,436 | 74.5 | % | |||||||||||||||||||||||
Personal lines | |||||||||||||||||||||||||||||||||||
Fire and allied lines | $ | 4,340 | $ | 6,409 | 147.7 | % | $ | 9,819 | $ | 19,187 | 195.4 | % | |||||||||||||||||||||||
Automobile | 2,295 | 2,261 | 98.5 | 7,518 | 2,464 | 32.8 | |||||||||||||||||||||||||||||
Miscellaneous | 110 | (1,450) | NM | 304 | 52 | 17.1 | |||||||||||||||||||||||||||||
Total personal lines | $ | 6,745 | $ | 7,220 | 107.0 | % | $ | 17,641 | $ | 21,703 | 123.0 | % | |||||||||||||||||||||||
Reinsurance assumed | $ | (1,290) | $ | 13 | NM | $ | 6,370 | $ | 4,834 | 75.9 | % | ||||||||||||||||||||||||
Total | $ | 224,703 | $ | 152,139 | 67.7 | % | $ | 263,609 | $ | 204,973 | 77.8 | % |
Six Months Ended June 30, | 2021 | 2020 | |||||||||||||||||||||||||||||||||
Net Losses | Net Losses | ||||||||||||||||||||||||||||||||||
and Loss | and Loss | ||||||||||||||||||||||||||||||||||
Net | Settlement | Net | Net | Settlement | Net | ||||||||||||||||||||||||||||||
(In Thousands, Except Ratios) | Premiums | Expenses | Loss | Premiums | Expenses | Loss | |||||||||||||||||||||||||||||
Unaudited | Earned | Incurred | Ratio | Earned | Incurred | Ratio | |||||||||||||||||||||||||||||
Commercial lines | |||||||||||||||||||||||||||||||||||
Other liability | $ | 150,013 | $ | 86,870 | 57.9 | % | $ | 156,716 | $ | 90,637 | 57.8 | % | |||||||||||||||||||||||
Fire and allied lines | 116,609 | 105,177 | 90.2 | 124,261 | 118,980 | 95.8 | |||||||||||||||||||||||||||||
Automobile | 129,247 | 109,598 | 84.8 | 151,700 | 123,319 | 81.3 | |||||||||||||||||||||||||||||
Workers' compensation | 32,077 | 22,336 | 69.6 | 38,628 | 13,955 | 36.1 | |||||||||||||||||||||||||||||
Fidelity and surety | 14,497 | 2,091 | 14.4 | 12,750 | 142 | 1.1 | |||||||||||||||||||||||||||||
Miscellaneous | 684 | (2) | (0.3) | 780 | 188 | 24.1 | |||||||||||||||||||||||||||||
Total commercial lines | $ | 443,127 | $ | 326,070 | 73.6 | % | $ | 484,835 | $ | 347,221 | 71.6 | % | |||||||||||||||||||||||
Personal lines | |||||||||||||||||||||||||||||||||||
Fire and allied lines | $ | 10,561 | $ | 11,018 | 104.3 | % | $ | 19,789 | $ | 25,921 | 131.0 | % | |||||||||||||||||||||||
Automobile | 6,335 | 5,561 | 87.8 | 15,148 | 7,613 | 50.3 | |||||||||||||||||||||||||||||
Miscellaneous | 287 | (1,360) | NM | 610 | 2,658 | NM | |||||||||||||||||||||||||||||
Total personal lines | $ | 17,183 | $ | 15,219 | 88.6 | % | $ | 35,547 | $ | 36,192 | 101.8 | % | |||||||||||||||||||||||
Reinsurance assumed | $ | 23,618 | $ | 17,248 | 73.0 | % | $ | 12,076 | $ | 8,063 | 66.8 | % | |||||||||||||||||||||||
Total | $ | 483,928 | $ | 358,537 | 74.1 | % | $ | 532,458 | $ | 391,476 | 73.5 | % | |||||||||||||||||||||||
Property & Casualty Insurance | |||||||||||
Percent | |||||||||||
(In Thousands, Except Ratios) | of Total | ||||||||||
Fixed maturities (1)
|
|||||||||||
Available-for-sale | $ | 1,781,865 | 84.6 | % | |||||||
Equity securities | 196,880 | 9.3 | |||||||||
Mortgage loans | 47,373 | 2.2 | |||||||||
Other long-term investments | 80,326 | 3.9 | |||||||||
Short-term investments | 801 | — | |||||||||
Total | $ | 2,107,245 | 100.0 | % |
(In Thousands, Except Ratios) | June 30, 2021 | December 31, 2020 | |||||||||||||||||||||
Rating | Carrying Value | % of Total | Carrying Value | % of Total | |||||||||||||||||||
AAA | $ | 721,106 | 40.4 | % | $ | 817,142 | 44.8 | % | |||||||||||||||
AA | 630,033 | 35.4 | 639,011 | 35.0 | |||||||||||||||||||
A | 208,169 | 11.7 | 182,011 | 10.0 | |||||||||||||||||||
Baa/BBB | 208,407 | 11.7 | 172,078 | 9.4 | |||||||||||||||||||
Other/Not Rated | 14,150 | 0.8 | 15,196 | 0.8 | |||||||||||||||||||
$ | 1,781,865 | 100.0 | % | $ | 1,825,438 | 100.0 | % |
Cash Flow Summary | Six Months Ended June 30, | ||||||||||
(In Thousands) | 2021 | 2020 | |||||||||
Cash provided by (used in) | |||||||||||
Operating activities | $ | 34,830 | $ | 4,232 | |||||||
Investing activities | 4,699 | 41,127 | |||||||||
Financing activities | (8,958) | (19,819) | |||||||||
Net increase in cash and cash equivalents | $ | 30,571 | $ | 25,540 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
(In Thousands) | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||
ISO catastrophes | $ | 21,082 | $ | 51,090 | $ | 48,171 | $ | 66,211 | |||||||||||||||
Non-ISO catastrophes (1)
|
531 | (456) | 2,688 | (311) | |||||||||||||||||||
Total catastrophes | $ | 21,613 | $ | 50,634 | $ | 50,859 | $ | 65,900 |
Exhibit number | Exhibit description | Furnished herewith | Filed herewith | ||||||||||||||
10.1 | |||||||||||||||||
31.1 | X | ||||||||||||||||
31.2 | X | ||||||||||||||||
32.1 | X | ||||||||||||||||
32.2 | X | ||||||||||||||||
101.1 |
The following financial information from United Fire Group, Inc.'s Quarterly Report on Form 10-Q for the quarter ended June 30, 2021 formatted in Inline eXtensible Business Reporting Language (Inline XBRL): (i) Consolidated Balance Sheets as of June 30, 2021 (unaudited) and December 31, 2020; (ii) Consolidated Statements of Income and Comprehensive Income (unaudited) for the three- and six-months ended June 30, 2021 and 2020 (iii) Consolidated Statement of Stockholders’ Equity (unaudited) for the three- and six-months ended June 30, 2021 and 2020; (iv) Consolidated Statements of Cash Flows (unaudited) for the three- and six-months ended June 30, 2021 and 2020; and (v) Notes to Unaudited Consolidated Financial Statements, tagged as a block of text.
|
X | |||||||||||||||
104.1 | X |
UNITED FIRE GROUP, INC. | ||||||||
(Registrant) | ||||||||
/s/ Randy A. Ramlo | /s/ Dawn M. Jaffray | |||||||
Randy A. Ramlo | Dawn M. Jaffray | |||||||
President, Chief Executive Officer, Director and Principal Executive Officer | Executive Vice President, Chief Financial Officer and Principal Accounting Officer | |||||||
August 4, 2021 | August 4, 2021 | |||||||
(Date) | (Date) |
1 Year United Fire Chart |
1 Month United Fire Chart |
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