SCPIE Holdings Reports Profitable Results for 2006 Year and Fourth Quarter

  
    
  
  
    
      SCPIE Holdings Inc. (NYSE:SKP), a major provider of healthcare liability 
      insurance, today reported improved financial results for the year and 
      fourth quarter ended December 31, 2006.
    
    
      In 2006, SCPIE had net income of $12.3 million, equal to $1.27 per 
      diluted share — a significant improvement from 
      2005 when the Company had net income of $3.5 million, or $0.36 per 
      diluted share. The improved performance in 2006 was attributable, 
      primarily, to reduced losses in the Company’s 
      assumed reinsurance business in run off.
    
    
      For the 2006 fourth quarter, SCPIE had net income of $4.0 million, or 
      $0.41 per diluted share. For the same period in 2005, the Company had 
      net income of $3.2 million, or $0.33 per diluted share.
    
    
      Core Operating Review
    
    
      Net earned premiums for SCPIE’s core 
      healthcare liability insurance business in 2006 was $123.2 million, a 
      slight decrease from the 2005 total of $127.6 million. Net written 
      premiums for 2006 were $123.3 million, compared to $126.9 million the 
      previous year. The decrease in premiums for 2006 is largely due to 
      improvements in the claims experience related to loss-rated policies.
    
    
      The core business produced an underwriting profit in 2006 of $10.8 
      million, comparable to the underwriting profit of $11.2 million in 2005. 
      The core operation loss and loss adjustment expense ratio decreased 
      slightly to 70.6% from 70.9% in the previous year. The combined ratio 
      for 2006 was 91.3%, nearly the same as 2005’s 
      ratio of 91.2%.
    
    
      “Our 2006 results clearly demonstrate the 
      strength of our core business and the diminishing impact of our segments 
      in run off,” said Donald J. Zuk, SCPIE 
      President and Chief Executive Officer. “The 
      solid core business, combined with a 96% retention rate in 2006, 
      provides solid momentum as we proceed into 2007.”
    
    
      For the 2006 fourth quarter, net earned premiums for SCPIE’s 
      core healthcare liability insurance business decreased slightly to $30.1 
      million from $31.1 million. Net written premiums were largely unchanged 
      with $24.5 million in the fourth quarter of 2006 versus $24.6 million a 
      year earlier.
    
    
      In the final quarter of 2006, the core business produced an underwriting 
      profit of $3.1 million, down from $5.1 million in 2005. The loss ratio 
      in core operations for the 2006 fourth quarter was 69.2% compared to 
      65.1% in 2005, and the combined ratio for the 2006 fourth quarter 
      increased to 89.7% from 83.6% in 2005.
    
    
      Non-Core Review
    
    
      SCPIE continued to run off its non-core healthcare liability operations. 
      Outstanding reserves for this segment declined further in 2006 to $37.7 
      million from $60.6 million at year-end 2005. Open claims dropped to 136 
      at the end of 2006, compared to 229 at the end of 2005.
    
    
      The Company reported losses for 2006 of $11.2 million — 
      $2.7 million in the fourth quarter — in the 
      assumed reinsurance segment. The loss is attributable to upward 
      development on reinsurance programs currently in run off.
    
    
      Financial Summary
    
    
      For 2006, SCPIE’s total revenues of $143.9 
      million include net earned premiums of $123.5 million, net investment 
      income of $20.4 million and a realized investment loss of $493,000. For 
      2005, total revenues of $151.5 million included net earned premiums of 
      $128.4 million, net investment income of $17.8 million and a realized 
      investment gain of $4.0 million.
    
    
      Total revenues of $35.6 million for the 2006 fourth quarter include 
      $30.3 million of earned premiums, $4.9 million of net investment income 
      and $70,000 of realized investment losses. For the fourth quarter of 
      2005, revenues of $40.4 million included $32.0 million of earned 
      premiums, $4.5 million of investment income and $4.3 million of realized 
      investment gains. Net written premiums for the 2006 fourth quarter 
      totaled $24.7 million, compared with $25.5 million a year earlier.
    
    
      SCPIE’s balance sheet remained debt-free at 
      December 31, 2006. Book value per share was $21.63 at year end, up from 
      $20.05 at December 31, 2005.
    
    
      Supplemental financial data relating to the performance of the Company’s 
      non-core direct healthcare liability operations and its assumed 
      reinsurance business is contained in the detailed financial statement 
      accompanying this news release.
    
    
      About SCPIE Holdings
    
    
      SCPIE Holdings Inc. is a leading provider of healthcare liability 
      insurance for physicians, oral and maxillofacial surgeons, and other 
      healthcare providers, as well as medical groups and healthcare 
      facilities. Since the company was founded in 1976, it has carved out a 
      significant niche in the insurance industry by providing innovative 
      products and services specifically for the healthcare community.
    
    
      Investor Conference Call
    
    
      An investor conference call to discuss SCPIE’s 
      2006 and fourth-quarter results will be conducted today, March 8, 2007, 
      at 9 am Pacific Time (noon Eastern Time). The call will be open to all 
      interested investors through a live audio web broadcast via the Internet 
      at www.scpie.com and www.earnings.com.
    
    
      Rebroadcast over the Internet will be available for one year on both 
      websites. A telephonic playback of the call can be heard from 
      approximately 11 am Pacific Time today to 5 pm Pacific Time, March 15, 
      2007. Listeners should call 888-286-8010 (domestic) or 617-801-6888 
      (international) and use Reservation Number 94476567.
    
    
      In addition to historical information, this news release contains 
      forward-looking statements that are based upon the Company’s 
      estimates and expectations concerning future events and are subject to 
      certain risks and uncertainties that could cause actual results to 
      differ materially from those reflected in the forward-looking 
      statements. Actuarial estimates of losses and loss expenses and 
      expectations concerning the Company’s ability 
      to retain current insureds at current levels of profitability, 
      successful withdrawal from the assumed reinsurance business, continued 
      solvency of the Company’s reinsurers, 
      obtaining rate change regulatory approvals, expansion of liability 
      insurance business in its principal market, and improved performance and 
      profitability are dependent upon a variety of factors, including future 
      economic, competitive and market conditions, frequency and severity of 
      catastrophic events, future legislative and regulatory actions, 
      uncertainties and potential delays in obtaining rate approvals, the 
      level of ratings from recognized rating services, the importance of 
      brokerage business to our growth, the inherent uncertainty of loss and 
      loss expense estimates in both the core business and discontinued 
      non-core business, and the cyclical nature of the property and casualty 
      insurance industry, all of which are difficult or impossible to predict 
      accurately and many of which are beyond the control of the Company. The 
      Company is also subject to certain structural risks as an insurance 
      holding company, including statutory restrictions on dividends and other 
      intercompany transactions. In light of the significant uncertainties 
      inherent in the forward-looking information herein, the inclusion of 
      such information should not be regarded as representation by the Company 
      or any other person that the Company’s 
      objectives or plans will be realized.
    
    
      
        
          SCPIE Holdings Inc. and Subsidiaries
        
      
      
        
          Consolidated Balance Sheets
        
      
      
        
          (Dollars in Thousands)
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
          December 31, 2006
        
        
        
        
          December 31, 2005
        
      
      
        
          ASSETS
        
        
        
        
        
        
        
        
        
      
      
        
          Securities available-for-sale:
        
        
        
        
        
        
        
        
        
      
      
        
          Fixed maturities investments, at fair value (amortized cost 2006 - 
          $397,553; 2005 - $469,350)
        
        
        
        
        
        
        
        
        
      
      
        
        
        
          $
        
        
          389,954 
        
        
        
        
          $
        
        
          461,480 
        
      
      
        
          Equity investments, at fair value (cost 2006 - $1,723; 2005 - $1,934)
        
        
        
        
        
        
        
        
        
      
      
        
        
        
           
        
        
          2,034 
        
        
        
        
           
        
        
          2,095 
        
      
      
        
          Total securities available-for-sale
        
        
        
        
        
        
          391,988 
        
        
        
        
        
        
          463,575 
        
      
      
        
          Cash and cash equivalents
        
        
        
        
           
        
        
          145,815 
        
        
        
        
           
        
        
          68,783 
        
      
      
        
          Total investments
        
        
        
        
        
        
          537,803 
        
        
        
        
        
        
          532,358 
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Accrued investment income
        
        
        
        
        
        
          5,330 
        
        
        
        
        
        
          5,874 
        
      
      
        
          Premiums receivable
        
        
        
        
        
        
          18,697 
        
        
        
        
        
        
          18,731 
        
      
      
        
          Assumed Reinsurance Receivables
        
        
        
        
        
        
          17,089 
        
        
        
        
        
        
          24,160 
        
      
      
        
          Reinsurance recoverable
        
        
        
        
        
        
          45,564 
        
        
        
        
        
        
          55,933 
        
      
      
        
          Deferred policy acquisition costs
        
        
        
        
        
        
          7,351 
        
        
        
        
        
        
          7,120 
        
      
      
        
          Deferred federal income taxes, net
        
        
        
        
        
        
          44,661 
        
        
        
        
        
        
          51,214 
        
      
      
        
          Property and equipment, net
        
        
        
        
        
        
          1,733 
        
        
        
        
        
        
          2,449 
        
      
      
        
          Other assets
        
        
        
        
           
        
        
          7,281 
        
        
        
        
           
        
        
          6,325 
        
      
      
        
          Total assets
        
        
        
        
          $
        
        
          685,509 
        
        
        
        
          $
        
        
          704,164 
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          LIABILITIES
        
        
        
        
        
        
        
        
        
      
      
        
          Reserves:
        
        
        
        
        
        
        
        
        
      
      
        
          Loss and loss adjustment expenses
        
        
        
        
          $
        
        
          405,448 
        
        
        
        
          $
        
        
          429,315 
        
      
      
        
          Unearned premiums
        
        
        
        
           
        
        
          41,815 
        
        
        
        
           
        
        
          41,705 
        
      
      
        
          Total reserves
        
        
        
        
        
        
          447,263 
        
        
        
        
        
        
          471,020 
        
      
      
        
          Amounts held for reinsurance
        
        
        
        
        
        
          13,317 
        
        
        
        
        
        
          22,018 
        
      
      
        
          Other liabilities
        
        
        
        
           
        
        
          18,285 
        
        
        
        
           
        
        
          20,333 
        
      
      
        
          Total liabilities
        
        
        
        
        
        
          478,865 
        
        
        
        
        
        
          513,371 
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Commitments and contingencies
        
        
        
        
        
        
        
        
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          STOCKHOLDERS' EQUITY
        
        
        
        
        
        
        
        
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Preferred stock - par value $1.00, 5,000,000 shares authorized, no 
          shares issued or outstanding
        
        
        
        
        
        
        
        
        
      
      
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
          - 
        
        
        
        
        
        
          - 
        
      
      
        
          Common stock - par value $.0001, 30,000,000 shares authorized, 
          12,792,091 shares issued,
        
        
        
        
        
        
        
        
        
      
      
        
        
        
        
        
        
        
           
        
      
      
        
          2006 - 9,553,906 shares outstanding
        
        
        
        
        
        
        
        
        
      
      
        
          2005 - 9,456,916 shares outstanding
        
        
        
        
        
        
          1 
        
        
        
        
        
        
          1 
        
      
      
        
          Additional paid-in capital
        
        
        
        
        
        
          37,127 
        
        
        
        
        
        
          37,127 
        
      
      
        
          Retained earnings
        
        
        
        
        
        
          271,925 
        
        
        
        
        
        
          259,645 
        
      
      
        
          Treasury stock, at cost
        
        
        
        
        
        
          (95,278)
        
        
        
        
        
        
          (97,063)
        
      
      
        
          (2006 - 2,738,185 shares and 2005 - 2,835,175 shares)
        
        
        
        
        
        
        
        
        
      
      
        
          Subscription notes receivable
        
        
        
        
        
        
          (1,849)
        
        
        
        
        
        
          (2,649)
        
      
      
        
          Accumulated other comprehensive loss
        
        
        
        
           
        
        
          (5,282)
        
        
        
        
           
        
        
          (6,268)
        
      
      
        
          Total stockholders' equity
        
        
        
        
           
        
        
          206,644 
        
        
        
        
           
        
        
          190,793 
        
      
      
        
          Total liabilities and stockholders' equity
        
        
        
        
          $
        
        
          685,509 
        
        
        
        
          $
        
        
          704,164 
        
      
    
    
      
        
          SCPIE Holdings Inc. and Subsidiaries
        
      
      
        
          Consolidated Statements of Operations
        
      
      
        
          (Dollars in Thousands, except per-share data)
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
          Twelve Months Ended
        
        
        
        
          Three Months Ended
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
          December 31, 2006
        
        
           
        
        
          December 31, 2005
        
        
        
        
          December 31, 2006
        
        
           
        
        
          December 31, 2005
        
      
      
        
          Revenues:
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Net premiums earned
        
        
        
        
          $
        
        
          123,531 
        
        
        
        
          $
        
        
          128,436 
        
        
        
        
          $
        
        
          30,286 
        
        
        
        
          $
        
        
          32,028 
        
      
      
        
          Net investment income
        
        
        
        
        
        
          20,410 
        
        
        
        
        
        
          17,818 
        
        
        
        
        
        
          4,934 
        
        
        
        
        
        
          4,463 
        
      
      
        
          
            Realized investment gains/(losses)
          
        
        
        
        
        
        
          (493)
        
        
        
        
        
        
          4,018 
        
        
        
        
        
        
          (70)
        
        
        
        
        
        
          4,276 
        
      
      
        
          
            Other revenue/(loss)
          
        
        
        
        
           
        
        
          461 
        
        
        
        
           
        
        
          1,183 
        
        
        
        
           
        
        
          443 
        
        
        
        
           
        
        
          (339)
        
      
      
        
          
            Total revenues
          
        
        
        
        
        
        
          143,909 
        
        
        
        
        
        
          151,455 
        
        
        
        
        
        
          35,593 
        
        
        
        
        
        
          40,428 
        
      
      
        
          Expenses:
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Losses & loss adjustment expenses incurred
        
        
        
        
        
        
          98,088 
        
        
        
        
        
        
          111,156 
        
        
        
        
        
        
          23,504 
        
        
        
        
        
        
          25,140 
        
      
      
        
          Other operating expenses
        
        
        
        
           
        
        
          27,465 
        
        
        
        
           
        
        
          34,807 
        
        
        
        
           
        
        
          6,394 
        
        
        
        
           
        
        
          10,306 
        
      
      
        
          Total expenses
        
        
        
        
           
        
        
          125,553 
        
        
        
        
           
        
        
          145,963 
        
        
        
        
           
        
        
          29,898 
        
        
        
        
           
        
        
          35,446 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Income before federal income taxes
        
        
        
        
        
        
          18,356 
        
        
        
        
        
        
          5,492 
        
        
        
        
        
        
          5,695 
        
        
        
        
        
        
          4,982 
        
      
      
        
          Income tax expense
        
        
        
        
           
        
        
          6,076 
        
        
        
        
           
        
        
          2,024 
        
        
        
        
           
        
        
          1,712 
        
        
        
        
           
        
        
          1,768 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net income
        
        
        
        
          $
        
        
          12,280 
        
        
        
        
          $
        
        
          3,468 
        
        
        
        
          $
        
        
          3,983 
        
        
        
        
          $
        
        
          3,214 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Basic earnings per share of common stock
        
        
        
        
          $
        
        
          1.29 
        
        
        
        
          $
        
        
          0.37 
        
        
        
        
          $
        
        
          0.42 
        
        
        
        
          $
        
        
          0.34 
        
      
      
        
          Diluted earnings per share of common stock
        
        
        
        
          $
        
        
          1.27 
        
        
        
        
          $
        
        
          0.36 
        
        
        
        
          $
        
        
          0.41 
        
        
        
        
          $
        
        
          0.33 
        
      
    
    
      
        
          SCPIE Holdings Inc. and Subsidiaries
        
      
      
        
          Supplemental Financial Data
        
      
      
        
          (Dollars in Thousands)
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
          
            Twelve Months Ended December 31, 2006
          
        
        
        
        
          
            Twelve Months Ended December 31, 2005
          
        
      
      
        
        
        
        
        
          Direct Healthcare Liability
        
        
        
        
          Assumed
        
        
        
        
        
        
        
        
        
        
        
        
          Direct Healthcare Liability
        
        
        
        
          Assumed
        
        
        
        
        
        
        
        
        
      
      
        
        
        
        
        
          
            Core(2)
          
        
        
        
        
          
            Non-Core (3)(4)
          
        
        
        
        
          
            Reinsurance (4)(5)
          
        
        
        
        
          
            Other(7)
          
        
        
        
        
          
            Total(6)
          
        
        
        
        
          
            Core(2)
          
        
        
        
        
          
            Non-Core (3)(4)
          
        
        
        
        
          
            Reinsurance (4)(5)
          
        
        
        
        
          Other
        
        
        
        
          
            Total(6)
          
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          
            Net written premium(1)
          
        
        
        
        
          $
        
        
          123,280 
        
        
        
        
          $
        
        
          - 
        
        
        
        
          $
        
        
          361 
        
        
        
        
        
        
        
        
          $
        
        
          123,641 
        
        
        
        
          $
        
        
          126,872 
        
        
        
        
          $
        
        
          377 
        
        
        
        
          $
        
        
          (918)
        
        
        
        
        
        
        
        
          $
        
        
          126,331 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net earned premium
        
        
        
        
          $
        
        
          123,170 
        
        
        
        
          $
        
        
          - 
        
        
        
        
          $
        
        
          361 
        
        
        
        
        
        
        
        
          $
        
        
          123,531 
        
        
        
        
          $
        
        
          127,556 
        
        
        
        
          $
        
        
          393 
        
        
        
        
          $
        
        
          487 
        
        
        
        
        
        
        
        
          $
        
        
          128,436 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net investment income
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          20,410 
        
        
        
        
        
        
          20,410 
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          17,818 
        
        
        
        
        
        
          17,818 
        
      
      
        
          
            Realized investment gains/(losses)
          
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          (493)
        
        
        
        
        
        
          (493)
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          4,018 
        
        
        
        
        
        
          4,018 
        
      
      
        
          Other revenue
        
        
        
        
           
        
        
        
        
           
        
        
        
        
           
        
        
        
        
           
        
        
          461 
        
        
        
        
           
        
        
          461 
        
        
        
        
           
        
        
        
        
           
        
        
        
        
           
        
        
        
        
           
        
        
          1,183 
        
        
        
        
           
        
        
          1,183 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Total revenue
        
        
        
        
        
        
          123,170 
        
        
        
        
        
        
          - 
        
        
        
        
        
        
          361 
        
        
        
        
        
        
          20,378 
        
        
        
        
        
        
          143,909 
        
        
        
        
        
        
          127,556 
        
        
        
        
        
        
          393 
        
        
        
        
        
        
          487 
        
        
        
        
        
        
          23,019 
        
        
        
        
        
        
          151,455 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Incurred loss and LAE
        
        
        
        
        
        
          86,928 
        
        
        
        
        
        
          - 
        
        
        
        
        
        
          11,160 
        
        
        
        
        
        
        
        
        
        
          98,088 
        
        
        
        
        
        
          90,463 
        
        
        
        
        
        
          (2,297)
        
        
        
        
        
        
          22,990 
        
        
        
        
        
        
        
        
        
        
          111,156 
        
      
      
        
          Other expenses
        
        
        
        
           
        
        
          25,479 
        
        
        
        
           
        
        
          - 
        
        
        
        
           
        
        
          377 
        
        
        
        
           
        
        
          1,609 
        
        
        
        
           
        
        
          27,465 
        
        
        
        
           
        
        
          25,900 
        
        
        
        
           
        
        
          78 
        
        
        
        
           
        
        
          8,829 
        
        
        
        
           
        
        
          - 
        
        
        
        
           
        
        
          34,807 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          
            Net underwriting income/(loss)
          
        
        
        
        
          $
        
        
          10,763 
        
        
        
        
          $
        
        
          - 
        
        
        
        
          $
        
        
          (11,176)
        
        
        
        
        
        
        
        
        
        
          (413)
        
        
        
        
          $
        
        
          11,193 
        
        
        
        
          $
        
        
          2,612 
        
        
        
        
          $
        
        
          (31,332)
        
        
        
        
        
        
        
        
        
        
          (17,527)
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net investment income, other revenue & expense
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          18,769 
        
        
        
        
           
        
        
          18,769 
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          23,019 
        
        
        
        
           
        
        
          23,019 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Income before federal Income taxes
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          18,356 
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          5,492 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          
            Net cash provided/(used) in operating activities
          
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          7,557 
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          (30,233)
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Loss ratio
        
        
        
        
        
        
          70.6%
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          70.9%
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Expense ratio
        
        
        
        
           
        
        
          20.7%
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
        
          20.3%
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Combined ratio (GAAP)
        
        
        
        
           
        
        
          91.3%
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
        
          91.2%
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
    
    
      
        
          (1)
        
        
        
        
          Net written premium is a non-GAAP financial measure which represents 
          the premiums charged on policies issued during a fiscal period less 
          any reinsurance. Net written premium is a statutory measure of 
          production levels. Net earned premium, a comparable GAAP measure, 
          represents the portion of premiums written that is recognized as 
          income in the financial statements for the periods presented and 
          earned on a pro-rata basis over the term of the policies. A 
          reconciliation of net written premium to net earned premium is 
          provided herein.
        
      
      
        
           
        
      
      
        
          (2)
        
        
        
        
          Core Direct Healthcare Liability Business represents California and 
          Delaware excluding discontinued dental and hospital programs.
        
      
      
        
           
        
      
      
        
          (3)
        
        
        
        
          Non-Core Direct Healthcare Liability Business represents other state 
          business and dental and hospital programs in California.
        
      
      
        
           
        
      
      
        
          (4)
        
        
        
        
          
            Ratios are not shown for the Non-Core Healthcare Liability and 
            Assumed Reinsurance columns because their run-off status produces 
            ratios which are not meaningful.
          
        
      
      
        
           
        
      
      
        
          (5)
        
        
        
        
          The expense component for the Assumed Reinsurance segment includes 
          the effect of the retrospective accounting treatment required by 
          Financial Accounting Standards Board No. 113, more fully described 
          in SCPIE's 2005 Annual Filing in Form 10K, page 41.
        
      
      
        
           
        
      
      
        
          (6)
        
        
        
        
          Ratios are not shown for the Total column, because inclusion of the 
          discontinued Non-Core Healthcare Liability and Assumed Reinsurance 
          results produce ratios which are no longer meaningful.
        
      
      
        
           
        
      
      
        
          (7)
        
        
        
        
          Other expenses in column relate to a proxy challenge instituted in 
          January 2006.
        
      
    
    
    
    
      
        
          SCPIE Holdings Inc. and Subsidiaries
        
      
      
        
          Supplemental Financial Data
        
      
      
        
          (Dollars in Thousands)
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
          
            Three Months Ended December 31, 2006
          
        
        
        
        
          
            Three Months Ended December 31, 2005
          
        
      
      
        
        
        
        
        
          Direct Healthcare Liability
        
        
        
        
          Assumed
        
        
        
        
        
        
        
        
        
        
        
        
          Direct Healthcare Liability
        
        
        
        
          Assumed
        
        
        
        
        
        
        
        
        
      
      
        
        
        
        
        
          
            Core(2)
          
        
        
        
        
          
            Non-Core (3)(4)
          
        
        
        
        
          
            Reinsurance (4)(5)
          
        
        
        
        
          Other
        
        
        
        
          
            Total(6)
          
        
        
        
        
          
            Core(2)
          
        
        
        
        
          
            Non-Core (3)(4)
          
        
        
        
        
          
            Reinsurance (4)(5)
          
        
        
        
        
          Other
        
        
        
        
          
            Total(6)
          
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          
            Net written premium(1)
          
        
        
        
        
          $
        
        
          24,523 
        
        
        
        
          $
        
        
          - 
        
        
        
        
          $
        
        
          182 
        
        
        
        
        
        
        
        
          $
        
        
          24,705 
        
        
        
        
          $
        
        
          24,585 
        
        
        
        
          $
        
        
          321 
        
        
        
        
          $
        
        
          606 
        
        
        
        
        
        
        
        
          $
        
        
          25,512 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net earned premium
        
        
        
        
          $
        
        
          30,104 
        
        
        
        
          $
        
        
          - 
        
        
        
        
          $
        
        
          182 
        
        
        
        
        
        
        
        
          $
        
        
          30,286 
        
        
        
        
          $
        
        
          31,082 
        
        
        
        
          $
        
        
          320 
        
        
        
        
          $
        
        
          626 
        
        
        
        
        
        
        
        
          $
        
        
          32,028 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net investment income
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          4,934 
        
        
        
        
        
        
          4,934 
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          4,463 
        
        
        
        
        
        
          4,463 
        
      
      
        
          
            Realized investment gains/(losses)
          
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          (70)
        
        
        
        
        
        
          (70)
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          4,276 
        
        
        
        
        
        
          4,276 
        
      
      
        
          
            Other revenue/(loss)
          
        
        
        
        
           
        
        
        
        
           
        
        
        
        
           
        
        
          - 
        
        
        
        
           
        
        
          443 
        
        
        
        
           
        
        
          443 
        
        
        
        
           
        
        
        
        
           
        
        
        
        
           
        
        
        
        
           
        
        
          (339)
        
        
        
        
           
        
        
          (339)
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Total revenue
        
        
        
        
        
        
          30,104 
        
        
        
        
        
        
          - 
        
        
        
        
        
        
          182 
        
        
        
        
        
        
          5,307 
        
        
        
        
        
        
          35,593 
        
        
        
        
        
        
          31,082 
        
        
        
        
        
        
          320 
        
        
        
        
        
        
          626 
        
        
        
        
        
        
          8,400 
        
        
        
        
        
        
          40,428 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Incurred loss and LAE
        
        
        
        
        
        
          20,845 
        
        
        
        
        
        
          - 
        
        
        
        
        
        
          2,659 
        
        
        
        
        
        
        
        
        
        
          23,504 
        
        
        
        
        
        
          20,234 
        
        
        
        
        
        
          315 
        
        
        
        
        
        
          4,591 
        
        
        
        
        
        
        
        
        
        
          25,140 
        
      
      
        
          Other expenses
        
        
        
        
           
        
        
          6,185 
        
        
        
        
           
        
        
          - 
        
        
        
        
           
        
        
          209 
        
        
        
        
           
        
        
          - 
        
        
        
        
           
        
        
          6,394 
        
        
        
        
           
        
        
          5,739 
        
        
        
        
           
        
        
          28 
        
        
        
        
           
        
        
          4,539 
        
        
        
        
           
        
        
          - 
        
        
        
        
           
        
        
          10,306 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          
            Net underwriting income/(loss)
          
        
        
        
        
          $
        
        
          3,074 
        
        
        
        
          $
        
        
          - 
        
        
        
        
          $
        
        
          (2,686)
        
        
        
        
        
        
        
        
        
        
          388 
        
        
        
        
          $
        
        
          5,109 
        
        
        
        
          $
        
        
          (23)
        
        
        
        
          $
        
        
          (8,504)
        
        
        
        
        
        
        
        
        
        
          (3,418)
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net investment income, other revenue & expense
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          5,307 
        
        
        
        
           
        
        
          5,307 
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          8,400 
        
        
        
        
           
        
        
          8,400 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Income before federal Income taxes
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          5,695 
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          4,982 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net cash provided in operating activities
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          5,207 
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          $
        
        
          5,585 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Loss ratio
        
        
        
        
        
        
          69.2%
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          65.1%
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Expense ratio
        
        
        
        
           
        
        
          20.5%
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
        
          18.5%
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Combined ratio (GAAP)
        
        
        
        
           
        
        
          89.7%
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
        
          83.6%
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
    
    
      
        
          (1)
        
        
        
        
          Net written premium is a non-GAAP financial measure which represents 
          the premiums charged on policies issued during a fiscal period less 
          any reinsurance. Net written premium is a statutory measure of 
          production levels. Net earned premium, a comparable GAAP measure, 
          represents the portion of premiums written that is recognized as 
          income in the financial statements for the periods presented and 
          earned on a pro-rata basis over the term of the policies. A 
          reconciliation of net written premium to net earned premium is 
          provided herein.
        
      
      
        
           
        
      
      
        
          (2)
        
        
        
        
          Core Direct Healthcare Liability Business represents California and 
          Delaware excluding discontinued dental and hospital programs.
        
      
      
        
           
        
      
      
        
          (3)
        
        
        
        
          Non-Core Direct Healthcare Liability Business represents other state 
          business and dental and hospital programs in California.
        
      
      
        
           
        
      
      
        
          (4)
        
        
        
        
          
            Ratios are not shown for the Non-Core Healthcare Liability and 
            Assumed Reinsurance columns because their run-off status produces 
            ratios which are not meaningful.
          
        
      
      
        
           
        
      
      
        
          (5)
        
        
        
        
          The expense component for the Assumed Reinsurance segment includes 
          the effect of the retrospective accounting treatment required by 
          Financial Accounting Standards Board No. 113, more fully described 
          in SCPIE's 2005 Annual Filing in Form 10K, page 41.
        
      
      
        
           
        
      
      
        
          (6)
        
        
        
        
          Ratios are not shown for the Total column, because inclusion of the 
          discontinued Non-Core Healthcare Liability and Assumed Reinsurance 
          results produce ratios which are not meaningful.
        
      
    
    
    
    
      
        
          SCPIE Holdings Inc. and Subsidiaries
        
      
      
        
          Supplemental Financial Data
        
      
      
        
          (Dollars in Thousands)
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
          12/31/2006 
        
      
      
        
          Fixed-maturity portfolio
        
        
        
        
        
        
        
        
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          U.S. government & agencies
        
        
        
        
          $
        
        
          173,320 
        
        
        
        
          44.4%
        
      
      
        
          Mortgage & asset-backed
        
        
        
        
        
        
          68,975 
        
        
        
        
          17.7%
        
      
      
        
          Corporate
        
        
        
        
           
        
        
          147,659 
        
        
        
        
          37.9%
        
      
      
        
          Total
        
        
        
        
          $
        
        
          389,954 
        
        
        
        
          100.0%
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Average quality
        
        
        
        
        
        
        
        
          AAA 
        
      
      
        
          Effective duration
        
        
        
        
        
        
        
        
          2.5 
        
      
      
        
          Yield to maturity
        
        
        
        
        
        
        
        
          5.0%
        
      
      
        
          Weighted average combined maturity
        
        
        
        
        
        
        
        
          3.8 
        
      
    
    
      
        
        
        
        
        
          Twelve Months Ended
        
        
        
        
          Three Months Ended
        
      
      
        
        
        
        
        
          December 31, 2006
        
        
        
        
          December 31, 2005
        
        
        
        
          December 31, 2006
        
        
        
        
          December 31, 2005
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Total premiums
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Net written premium
        
        
        
        
          $
        
        
          123,641 
        
        
        
        
          $
        
        
          126,331 
        
        
        
        
          $
        
        
          24,705 
        
        
        
        
          $
        
        
          25,512 
        
      
      
        
          Change in unearned premium
        
        
        
        
           
        
        
          (110)
        
        
        
        
           
        
        
          2,105 
        
        
        
        
           
        
        
          5,581 
        
        
        
        
           
        
        
          6,516 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net earned premium
        
        
        
        
          $
        
        
          123,531 
        
        
        
        
          $
        
        
          128,436 
        
        
        
        
          $
        
        
          30,286 
        
        
        
        
          $
        
        
          32,028