Exhibit 99.1
The Navigators Group, Inc.
CORPORATE NEWS
CORPORATE NEWS
Navigators Reports First Quarter Earnings
Net Income Up 42% ; Book Value Up 4%
New York — May 6, 2010 — The Navigators Group, Inc. (NASDAQ:NAVG)reported net income of $17.0 million, or $1.00 per diluted share, for the three months ended March 31, 2010 compared to net income of $12.0 million, or $0.71 per diluted share, for the comparable period in 2009. Operating earnings(1) were $13.1 million, or $0.77 per diluted share for the first quarter of 2010 compared to $20.2 million, or $1.19 per diluted share, for the first quarter of 2009.
Gross written premiums and net written premiums for the three months ended March 31, 2010 were $270.1 million and $189.3 million, respectively, a decrease of 1.9% and 5.6% from the comparable 2009 periods, respectively.
The combined loss and expense ratio for the three months ended March 31, 2010 was 99.1%, compared to 92.8% for the comparable 2009 period. The combined loss and expense ratio for the three months ended March 31, 2010 was positively impacted by 0.8 loss ratio points due to favorable development in prior period loss reserves. The combined loss and expense ratio for the three months ended March 31, 2009 was positively impacted by 3.5 loss ratio points due to favorable development.
Navigators’ Chief Executive Officer Stan Galanski commented, “We have a long-term view on the business focused on book value per share growth and effective capital management. Consistent with that approach, we are pleased to report that book value per share increased 4% to $49.47 during the quarter, a record high for Navigators, driven by our reported underwriting profit, strong investment performance and the share repurchase program.
In what continues to be a very challenging underwriting environment, we continue to see good progress in our recent initiatives to enhance our underwriting and marketing capabilities. Our marketing activities have generated more opportunities including additional business with new producers and the cross selling of existing products to our current producers.
Although rates in most lines have been relatively stable, there are examples of aggressive rate competition from both new and existing markets in virtually every line of business. We continue to emphasize underwriting discipline over premium growth. As we have demonstrated again this quarter, we will walk away from underpriced business and return excess capital to our shareholders in order to achieve our strategic objectives.”
6 International Drive | Rye Brook, NY 10573 | |||
TEL (914) 933-6000 | FAX (914) 934-2355 |
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May 6, 2010
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May 6, 2010
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During the three months ended March 31, 2010, the Company repurchased 573,600 shares of its common stock for an aggregate purchase price of $23.7 million pursuant to its share repurchase program. The Company repurchased an additional 179,812 shares of its common stock for an aggregate purchase price of $7.3 million from April 1, 2010 through May 4, 2010 pursuant to its share repurchase program.
Net investment income for the three months ended March 31, 2010 was $18.0 million, a decrease of 4.1% from the comparable 2009 period. The annualized pre-tax investment yield, excluding net realized gains and lossesand net other-than-temporary impairment losses recognized in earnings, was 3.6% for the three months ended March 31, 2010, compared to 3.9% for the comparable 2009 period. The effective tax rate on net investment income was 24.5% for the three months ended March 31, 2010, compared to 24.9% for the comparable 2009 period.
The Company’s investment portfolio mainly consists of fixed income securities with an average quality rating of “AA/Aa” as defined by Standard & Poor’s and Moody’s, respectively, and an average effective duration of 4.2 years at March 31, 2010. At March 31, 2010, net unrealized gains within our investment portfolio were $63.1 million, an increase of $9.2 million compared to December 31, 2009. There were $6.1 million of net realized gains for the three months ended March 31, 2010.
Consolidated cash flow from operations for the three months ended March 31, 2010 was $4.1 million, compared to $42.9 million for the comparable 2009 period.
Stockholders’ equity was $810.0 million, or $49.47 per share, at March 31, 2010 compared to $801.5 million, or $47.58 per share, at December 31, 2009. The statutory surplus of Navigators Insurance Company was $655.8 million at March 31, 2010 compared to $645.8 million at December 31, 2009.
(1) | Operating earnings, or net income excluding after-tax net realized gains (losses) and net other-than-temporary impairment losses recognized in earnings, is a non-GAAP financial measure that is a common performance measurement for insurance companies. We believe this presentation enhances the understanding of our results of operations by highlighting the underlying profitability of our insurance business. |
The Company will hold a conference call on Friday, May 7, 2010 starting at 8:30 a.m. ET to discuss the 2010 first quarter results. The call will be available via live webcast on Navigators’ website (www.navg.com) by clicking on the Earnings Webcast link under “News & Events”.
To participate by telephone, the domestic dial-in number is (888) 680-0879 and the international dial-in is (617) 213-4856. The access code is 41487807. Participants may pre-register for the call at
https://www.theconferencingservice.com/prereg/key.process?key=PHCFQMB9M. Pre-registrants will be issued a pin number to use when dialing into the live call that will provide quick access by bypassing the operator upon connection.
https://www.theconferencingservice.com/prereg/key.process?key=PHCFQMB9M. Pre-registrants will be issued a pin number to use when dialing into the live call that will provide quick access by bypassing the operator upon connection.
The Navigators Group, Inc. is an international specialty insurance holding company with insurance company operations, underwriting management companies, and operations at Lloyd’s of London. Headquartered in New York, Navigators has offices in major insurance centers in the United States, the United Kingdom and Continental Europe.
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This press release may contain “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Whenever used in this release, the words “estimate”, “expect”, “believe” or similar expressions are intended to identify such forward-looking statements. Forward-looking statements are derived from information that we currently have and assumptions that we make. We cannot assure that results that we anticipate will be achieved, since results may differ materially because of known and unknown risks and uncertainties that we face. Please refer to Navigators’ most recent reports on Forms 10-K and 10-Q and its other filings with the Securities and Exchange Commission for a description of Navigators’ business and the important factors that may affect that business. Navigators undertakes no obligation to publicly update or revise any forward-looking statement.
Contact: | Francis W. McDonnell Senior Vice President and Chief Financial Officer (914) 933-6270 fmcdonnell@navg.com www.navg.com |
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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES
Financial Highlights
($ in thousands, except per share data)
(unaudited)
Financial Highlights
($ in thousands, except per share data)
(unaudited)
Three Months Ended | ||||||||||||
March 31, | ||||||||||||
2010 | 2009 | Change | ||||||||||
Results of Operations | ||||||||||||
Gross written premiums | $ | 270,145 | $ | 275,259 | -2 | % | ||||||
Net written premiums | 189,317 | 200,652 | -6 | % | ||||||||
Revenues: | ||||||||||||
Net earned premiums | 164,069 | 164,946 | -1 | % | ||||||||
Investment income | 17,972 | 18,743 | -4 | % | ||||||||
Total other-than-temporary impairment losses | (251 | ) | (26,871 | ) | -99 | % | ||||||
Portion of loss recognized in other comprehensive income (before tax) | 170 | 16,171 | -99 | % | ||||||||
Net other-than-temporary impairment losses recognized in earnings | (81 | ) | (10,700 | ) | -99 | % | ||||||
Net realized gains (losses) | 6,113 | (1,537 | ) | NM | ||||||||
Other income (expense) | 1,070 | 143 | 646 | % | ||||||||
Total revenues | 189,143 | 171,595 | 10 | % | ||||||||
Expenses: | ||||||||||||
Net losses and loss adjustment expenses | 103,807 | 100,247 | 4 | % | ||||||||
Commission expenses | 25,316 | 22,448 | 13 | % | ||||||||
Other operating expenses | 34,586 | 30,535 | 13 | % | ||||||||
Interest expense | 2,044 | 2,219 | -8 | % | ||||||||
Total expenses | 165,753 | 155,449 | 7 | % | ||||||||
Income before income taxes | 23,390 | 16,146 | 45 | % | ||||||||
Income tax expense | 6,345 | 4,146 | 53 | % | ||||||||
Net income | $ | 17,045 | $ | 12,000 | 42 | % | ||||||
Per Share Data | ||||||||||||
Net income per common share: | ||||||||||||
Basic | $ | 1.02 | $ | 0.71 | 44 | % | ||||||
Diluted | $ | 1.00 | $ | 0.71 | 42 | % | ||||||
Average shares outstanding: | ||||||||||||
Basic | 16,641 | 16,882 | ||||||||||
Diluted | 16,979 | 17,002 | ||||||||||
Underwriting Ratios | ||||||||||||
Loss Ratio | 63.3 | % | 60.8 | % | ||||||||
Expense Ratio | 35.8 | % | 32.0 | % | ||||||||
Combined Ratio | 99.1 | % | 92.8 | % |
Mar. 31, | Dec. 31, | |||||||||||
2010 | 2009 | |||||||||||
Balance Sheet Data | ||||||||||||
Stockholders’ equity | $ | 810,044 | $ | 801,519 | 1 | % | ||||||
Book value per share | $ | 49.47 | $ | 47.58 | 4 | % |
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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
($ in thousands, except share data)
CONSOLIDATED BALANCE SHEETS
($ in thousands, except share data)
March 31, | December 31, | |||||||
2010 | 2009 | |||||||
(unaudited) | ||||||||
ASSETS | ||||||||
Investments and cash: | ||||||||
Fixed maturities, available-for-sale, at fair value (amortized cost: 2010, $1,762,223; 2009, $1,777,983) | $ | 1,807,348 | $ | 1,816,669 | ||||
Equity securities, available-for-sale, at fair value (cost: 2010, $54,624; 2009, $47,376) | 72,609 | 62,610 | ||||||
Short-term investments, at cost which approximates fair value | 172,342 | 176,799 | ||||||
Cash | 2,699 | 509 | ||||||
Total investments and cash | 2,054,998 | 2,056,587 | ||||||
Premiums receivable | 225,025 | 193,460 | ||||||
Prepaid reinsurance premiums | 157,201 | 162,344 | ||||||
Reinsurance recoverable on paid losses | 75,355 | 76,505 | ||||||
Reinsurance recoverable on unpaid losses and loss adjustment expenses | 795,914 | 807,352 | ||||||
Deferred policy acquisition costs | 63,133 | 56,575 | ||||||
Accrued investment income | 16,767 | 17,438 | ||||||
Goodwill and other intangible assets | 6,779 | 7,057 | ||||||
Current income tax receivable, net | 5,021 | 4,854 | ||||||
Deferred income tax, net | 25,643 | 31,222 | ||||||
Other assets | 34,895 | 40,600 | ||||||
Total assets | $ | 3,460,731 | $ | 3,453,994 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Liabilities: | ||||||||
Reserves for losses and loss adjustment expenses | $ | 1,913,760 | $ | 1,920,286 | ||||
Unearned premiums | 494,061 | 475,171 | ||||||
Reinsurance balances payable | 86,376 | 98,555 | ||||||
Senior notes | 114,041 | 114,010 | ||||||
Accounts payable and other liabilities | 42,449 | 44,453 | ||||||
Total liabilities | 2,650,687 | 2,652,475 | ||||||
Stockholders’ equity: | ||||||||
Preferred stock, $.10 par value, authorized 1,000,000 shares, none issued | — | — | ||||||
Common stock, $.10 par value, authorized 50,000,000 shares, issued 17,228,278 shares for 2010 and 17,212,814 shares for 2009 | 1,723 | 1,721 | ||||||
Additional paid-in capital | 307,517 | 304,505 | ||||||
Retained earnings | 486,979 | 469,934 | ||||||
Treasury stock, at cost (853,842 for 2010 and 366,330 shares for 2009) | (37,290 | ) | (18,296 | ) | ||||
Accumulated other comprehensive income (loss) | 51,115 | 43,655 | ||||||
Total stockholders’ equity | 810,044 | 801,519 | ||||||
Total liabilities and stockholders’ equity | $ | 3,460,731 | $ | 3,453,994 | ||||
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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES
Comparative Premium Data
($ in thousands, except share data)
Comparative Premium Data
($ in thousands, except share data)
First Quarter | ||||||||||||
2010 | 2009 | Change | ||||||||||
Gross Written Premiums: | ||||||||||||
Insurance Companies: | ||||||||||||
Marine | $ | 67,526 | $ | 77,237 | -13 | % | ||||||
Property Casualty | 79,346 | 84,258 | -6 | % | ||||||||
Professional Liability | 30,966 | 30,488 | 2 | % | ||||||||
177,838 | 191,983 | -7 | % | |||||||||
Lloyd’s Operations: | ||||||||||||
Marine | 59,141 | 59,023 | 0 | % | ||||||||
Property Casualty | 19,959 | 13,528 | 48 | % | ||||||||
Professional Liability | 13,207 | 10,725 | 23 | % | ||||||||
92,307 | 83,276 | 11 | % | |||||||||
Total | $ | 270,145 | $ | 275,259 | -2 | % | ||||||
First Quarter | ||||||||||||
2010 | 2009 | Change | ||||||||||
Net Written Premiums: | ||||||||||||
Insurance Companies: | ||||||||||||
Marine | $ | 51,003 | $ | 58,459 | -13 | % | ||||||
Property Casualty | 49,697 | 59,976 | -17 | % | ||||||||
Professional Liability | 20,640 | 18,647 | 11 | % | ||||||||
121,340 | 137,082 | -11 | % | |||||||||
Lloyd’s Operations: | ||||||||||||
Marine | 49,642 | 49,974 | -1 | % | ||||||||
Property Casualty | 11,711 | 7,595 | 54 | % | ||||||||
Professional Liability | 6,624 | 6,001 | 10 | % | ||||||||
67,977 | 63,570 | 7 | % | |||||||||
Total | $ | 189,317 | $ | 200,652 | -6 | % | ||||||
First Quarter | ||||||||||||
2010 | 2009 | Change | ||||||||||
Net Earned Premiums: | ||||||||||||
Insurance Companies: | ||||||||||||
Marine | $ | 41,094 | $ | 37,161 | 11 | % | ||||||
Property Casualty | 51,081 | 65,412 | -22 | % | ||||||||
Professional Liability | 19,036 | 17,717 | 7 | % | ||||||||
111,211 | 120,290 | -8 | % | |||||||||
Lloyd’s Operations: | ||||||||||||
Marine | 35,560 | 31,175 | 14 | % | ||||||||
Property Casualty | 11,915 | 7,923 | 50 | % | ||||||||
Professional Liability | 5,383 | 5,558 | -3 | % | ||||||||
52,858 | 44,656 | 18 | % | |||||||||
Total | $ | 164,069 | $ | 164,946 | -1 | % | ||||||
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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES
Segment Information
Three Months Ended
March 31, 2010
Segment Information
Three Months Ended
March 31, 2010
($ in thousands)
Insurance | Lloyd's | |||||||||||||||
Companies | Operations | Corporate | Total | |||||||||||||
Gross written premiums | $ | 177,838 | $ | 92,307 | $ | — | $ | 270,145 | ||||||||
Net written premiums | 121,340 | 67,977 | — | 189,317 | ||||||||||||
Net earned premiums | 111,211 | 52,858 | — | 164,069 | ||||||||||||
Net losses and loss adjustment expenses | (68,403 | ) | (35,404 | ) | — | (103,807 | ) | |||||||||
Commission expenses | (14,362 | ) | (10,966 | ) | 12 | (25,316 | ) | |||||||||
Other operating expenses | (27,353 | ) | (7,243 | ) | — | (34,596 | ) | |||||||||
Other income (expense) | (977 | ) | 2,069 | (12 | ) | 1,080 | ||||||||||
Underwriting profit | 116 | 1,314 | — | 1,430 | ||||||||||||
Investment income | 15,748 | 2,069 | 155 | 17,972 | ||||||||||||
Net realized gains (losses) | 5,205 | 713 | 114 | 6,032 | ||||||||||||
Other operating expenses | — | — | 10 | 10 | ||||||||||||
Other income (expense) | — | — | (10 | ) | (10 | ) | ||||||||||
Interest expense | — | — | (2,044 | ) | (2,044 | ) | ||||||||||
Income (loss) before income tax expense (benefit) | 21,069 | 4,096 | (1,775 | ) | 23,390 | |||||||||||
Income tax expense (benefit) | 5,463 | 1,503 | (621 | ) | 6,345 | |||||||||||
Net income (loss) | $ | 15,606 | $ | 2,593 | $ | (1,154 | ) | $ | 17,045 | |||||||
Loss and loss expenses ratio | 61.5 | % | 67.0 | % | 63.3 | % | ||||||||||
Commission expense ratio | 12.9 | % | 20.7 | % | 15.4 | % | ||||||||||
Other operating expenses ratio (1) | 25.5 | % | 9.8 | % | 20.4 | % | ||||||||||
Combined ratio | 99.9 | % | 97.5 | % | 99.1 | % | ||||||||||
(1) | The Other operating expenses ratio includes Other income (expense). |
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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES
Segment Information
Three Months Ended
March 31, 2009
Segment Information
Three Months Ended
March 31, 2009
($ in thousands)
Insurance | Lloyd’s | |||||||||||||||
Companies | Operations | Corporate | Total | |||||||||||||
Gross written premiums | $ | 191,983 | $ | 83,276 | $ | — | $ | 275,259 | ||||||||
Net written premiums | 137,082 | 63,570 | — | 200,652 | ||||||||||||
Net earned premiums | 120,290 | 44,656 | — | 164,946 | ||||||||||||
Net losses and loss adjustment expenses | (70,153 | ) | (30,094 | ) | — | (100,247 | ) | |||||||||
Commission expenses | (14,968 | ) | (7,480 | ) | — | (22,448 | ) | |||||||||
Other operating expenses | (24,560 | ) | (5,981 | ) | 6 | (30,535 | ) | |||||||||
Other income (expense) | 201 | (52 | ) | (6 | ) | 143 | ||||||||||
Underwriting profit | 10,810 | 1,049 | — | 11,859 | ||||||||||||
Investment income | 16,207 | 2,383 | 153 | 18,743 | ||||||||||||
Net realized gains (losses) | (8,907 | ) | (3,330 | ) | — | (12,237 | ) | |||||||||
Interest expense | — | — | (2,219 | ) | (2,219 | ) | ||||||||||
Income (loss) before income tax expense (benefit) | 18,110 | 102 | (2,066 | ) | 16,146 | |||||||||||
Income tax expense (benefit) | 4,533 | 336 | (723 | ) | 4,146 | |||||||||||
Net income (loss) | $ | 13,577 | $ | (234 | ) | $ | (1,343 | ) | $ | 12,000 | ||||||
Loss and loss expenses ratio | 58.3 | % | 67.4 | % | 60.8 | % | ||||||||||
Commission expense ratio | 12.4 | % | 16.8 | % | 13.6 | % | ||||||||||
Other operating expenses ratio (1) | 20.3 | % | 13.5 | % | 18.4 | % | ||||||||||
Combined ratio | 91.0 | % | 97.7 | % | 92.8 | % | ||||||||||
(1) | The Other operating expenses ratio includes Other income (expense). |
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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES
Underwriting Results
($ in thousands)
Underwriting Results
($ in thousands)
Three Months Ended March 31, 2010 | ||||||||||||||||||||||||||||
Net | Losses | |||||||||||||||||||||||||||
Earned | and LAE | Underwriting | Underwriting | Combined Ratio | ||||||||||||||||||||||||
Premiums | Incurred | Expenses | Gain(Loss) | Loss | Expense | Total | ||||||||||||||||||||||
Insurance Companies: | ||||||||||||||||||||||||||||
Marine | $ | 41,094 | $ | 26,133 | $ | 14,928 | $ | 33 | 63.6 | % | 36.3 | % | 99.9 | % | ||||||||||||||
Property Casualty | 51,081 | 32,126 | 20,316 | (1,361 | ) | 62.9 | % | 39.8 | % | 102.7 | % | |||||||||||||||||
Professional Liability | 19,036 | 10,144 | 7,448 | 1,444 | 53.3 | % | 39.1 | % | 92.4 | % | ||||||||||||||||||
111,211 | 68,403 | 42,692 | 116 | 61.5 | % | 38.4 | % | 99.9 | % | |||||||||||||||||||
Lloyd’s Operations | 52,858 | 35,404 | 16,140 | 1,314 | 67.0 | % | 30.5 | % | 97.5 | % | ||||||||||||||||||
Total | $ | 164,069 | $ | 103,807 | $ | 58,832 | $ | 1,430 | 63.3 | % | 35.8 | % | 99.1 | % | ||||||||||||||
Three Months Ended March 31, 2009 | ||||||||||||||||||||||||||||
Net | Losses | |||||||||||||||||||||||||||
Earned | and LAE | Underwriting | Underwriting | Combined Ratio | ||||||||||||||||||||||||
Premiums | Incurred | Expenses | Gain(Loss) | Loss | Expense | Total | ||||||||||||||||||||||
Insurance Companies: | ||||||||||||||||||||||||||||
Marine | $ | 37,161 | $ | 26,390 | $ | 11,622 | $ | (851 | ) | 71.0 | % | 31.3 | % | 102.3 | % | |||||||||||||
Property Casualty | 65,412 | 28,004 | 20,753 | 16,655 | 42.8 | % | 31.7 | % | 74.5 | % | ||||||||||||||||||
Professional Liability | 17,717 | 15,759 | 6,952 | (4,994 | ) | 89.0 | % | 39.2 | % | 128.2 | % | |||||||||||||||||
120,290 | 70,153 | 39,327 | 10,810 | 58.3 | % | 32.7 | % | 91.0 | % | |||||||||||||||||||
Lloyd’s Operations | 44,656 | 30,094 | 13,513 | 1,049 | 67.4 | % | 30.3 | % | 97.7 | % | ||||||||||||||||||
Total | $ | 164,946 | $ | 100,247 | $ | 52,840 | $ | 11,859 | 60.8 | % | 32.0 | % | 92.8 | % | ||||||||||||||
Amounts | Loss Ratio | |||||||||||||||
Mar. 31, | Mar. 31, | Mar. 31, | Mar. 31, | |||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Net Incurred Loss Activity For the Three Months Ended: | ||||||||||||||||
Insurance Companies: | ||||||||||||||||
Loss and LAE payments | $ | 72,673 | $ | 48,804 | 65.3 | % | 40.6 | % | ||||||||
Change in reserves | (4,270 | ) | 21,349 | -3.8 | % | 17.7 | % | |||||||||
Net incurred loss and LAE | 68,403 | 70,153 | 61.5 | % | 58.3 | % | ||||||||||
Lloyd’s Operations: | ||||||||||||||||
Loss and LAE payments | 26,222 | 23,122 | 49.6 | % | 51.8 | % | ||||||||||
Change in reserves | 9,182 | 6,972 | 17.4 | % | 15.6 | % | ||||||||||
Net incurred loss and LAE | 35,404 | 30,094 | 67.0 | % | 67.4 | % | ||||||||||
Total | ||||||||||||||||
Loss and LAE payments | 98,895 | 71,926 | 60.3 | % | 43.6 | % | ||||||||||
Change in reserves | 4,912 | 28,321 | 3.0 | % | 17.2 | % | ||||||||||
Net incurred loss and LAE | $ | 103,807 | $ | 100,247 | 63.3 | % | 60.8 | % | ||||||||
Amounts | Loss Ratio Impact | |||||||||||||||
Mar. 31, | Mar. 31, | Mar. 31, | Mar. 31, | |||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Impact of Prior Years Reserves Favorable / (Unfavorable) Development For the Three Months Ended: | ||||||||||||||||
Insurance Companies | $ | 653 | $ | 5,132 | 0.6 | % | 4.3 | % | ||||||||
Lloyd’s Operations | 593 | 635 | 1.1 | % | 1.4 | % | ||||||||||
Total | $ | 1,246 | $ | 5,767 | 0.8 | % | 3.5 | % | ||||||||
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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES
Net Loss Data
($ in thousands)
Net Loss Data
($ in thousands)
Case | IBNR | |||||||||||
Reserves | Reserves | Total | ||||||||||
Net Loss Reserves, March 31, 2010: | ||||||||||||
Insurance Companies: | ||||||||||||
Marine | $ | 113,864 | $ | 98,044 | $ | 211,908 | ||||||
Property Casualty | 139,708 | 348,242 | 487,950 | |||||||||
Professional Liability | 37,765 | 65,382 | 103,147 | |||||||||
Total Insurance Companies | 291,337 | 511,668 | 803,005 | |||||||||
Lloyd’s Operations: | ||||||||||||
Marine | 110,889 | 101,925 | 212,814 | |||||||||
Property Casualty | 26,671 | 28,409 | 55,080 | |||||||||
Professional Liability | 9,246 | 37,701 | 46,947 | |||||||||
Total Lloyd’s Operations | 146,806 | 168,035 | 314,841 | |||||||||
Total Net Loss Reserves | $ | 438,143 | $ | 679,703 | $ | 1,117,846 | ||||||
Case | IBNR | |||||||||||
Reserves | Reserves | Total | ||||||||||
Net Loss Reserves, December 31, 2009: | ||||||||||||
Insurance Companies: | ||||||||||||
Marine | $ | 113,604 | $ | 100,042 | $ | 213,646 | ||||||
Property Casualty | 134,427 | 351,985 | 486,412 | |||||||||
Professional Liability | 38,410 | 68,807 | 107,217 | |||||||||
Total Insurance Companies | 286,441 | 520,834 | 807,275 | |||||||||
Lloyd’s Operations: | ||||||||||||
Marine | 107,800 | 101,851 | 209,651 | |||||||||
Property Casualty | 27,148 | 25,175 | 52,323 | |||||||||
Professional Liability | 7,442 | 36,243 | 43,685 | |||||||||
Total Lloyd’s Operations | 142,390 | 163,269 | 305,659 | |||||||||
Total Net Loss Reserves | $ | 428,831 | $ | 684,103 | $ | 1,112,934 | ||||||
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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES
Investment Data
March 31, 2010
($ in thousands)
Investment Data
March 31, 2010
($ in thousands)
At March 31, 2010, the average quality of the investment portfolio as rated by S&P and Moody’s was AA/Aa with an average duration of 4.2 years. The Company does not own any collateralized debt obligations (CDO’s), collateralized loan obligations (CLO’s) or asset backed commercial paper.
At March 31, 2010, the Company owned two asset-backed securities approximating $0.1 million with subprime mortgage exposures. The securities have an effective maturity of 3.0 years. In addition, the Company owned a total of five collateralized mortgage obligations and asset-backed securities approximating $1.4 million classified as Alt-A which is a credit category between prime and subprime. They have an effective maturity of 5.6 years. Such subprime and Alt-A categories are as defined by S&P. The Company is receiving principal and/or interest payments on all these securities and believes such amounts are fully collectible.
The following table sets forth our cash and investments at March 31, 2010:
Gross | Gross | Cost or | OTTI | |||||||||||||||||
Fair | Unrealized | Unrealized | Amortized | Recognized | ||||||||||||||||
March 31, 2010 | Value | Gains | (Losses) | Cost | in OCI | |||||||||||||||
($ in thousands) | ||||||||||||||||||||
Fixed maturities: | ||||||||||||||||||||
U.S. Government Treasury bonds, agency bonds and foreign government bonds | $ | 408,935 | $ | 7,571 | $ | (355 | ) | $ | 401,719 | $ | — | |||||||||
States, municipalities and political subdivisions | 640,783 | 22,064 | (1,996 | ) | 620,715 | — | ||||||||||||||
Mortgage- and asset-backed securities | ||||||||||||||||||||
Agency mortgage-backed securities | 348,619 | 12,289 | (108 | ) | 336,438 | — | ||||||||||||||
Residential mortgage obligations | 30,486 | — | (6,050 | ) | 36,536 | (4,685 | ) | |||||||||||||
Asset-backed securities | 11,283 | 485 | (34 | ) | 10,832 | (34 | ) | |||||||||||||
Commercial mortgage-backed securities | 105,728 | 2,494 | (685 | ) | 103,919 | — | ||||||||||||||
Subtotal | 496,116 | 15,268 | (6,877 | ) | 487,725 | (4,719 | ) | |||||||||||||
Corporate bonds | 261,514 | 10,132 | (682 | ) | 252,064 | — | ||||||||||||||
Total fixed maturities | 1,807,348 | 55,035 | (9,910 | ) | 1,762,223 | (4,719 | ) | |||||||||||||
Equity securities — common stocks | 72,609 | 17,995 | (10 | ) | 54,624 | — | ||||||||||||||
Cash | 2,699 | — | — | 2,699 | — | |||||||||||||||
Short-term investments | 172,342 | — | — | 172,342 | — | |||||||||||||||
Total | $ | 2,054,998 | $ | 73,030 | $ | (9,920 | ) | $ | 1,991,888 | $ | (4,719 | ) | ||||||||
News Release
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The Navigators Group, Inc. and Subsidiaries
Investment Data
March 31, 2010
($ in thousands)
Investment Data
March 31, 2010
($ in thousands)
The following three tables set forth our agency mortgage-backed securities, residential mortgage obligations, and asset-backed securities by those issued by GNMA, FNMA and FHLMC and the quality category (prime, Alt-A and subprime) for all other such investments at March 31, 2010:
Gross | Gross | Cost or | ||||||||||||||
Fair | Unrealized | Unrealized | Amortized | |||||||||||||
Value | Gains | (Losses) | Cost | |||||||||||||
Agency mortgage-backed securities: | ||||||||||||||||
GNMA | $ | 116,201 | $ | 1,282 | $ | (72 | ) | $ | 114,991 | |||||||
FNMA | 162,550 | 8,288 | (17 | ) | 154,279 | |||||||||||
FHLMC | 69,868 | 2,719 | (19 | ) | 67,168 | |||||||||||
Total | $ | 348,619 | $ | 12,289 | $ | (108 | ) | $ | 336,438 | |||||||
Gross | Gross | Cost or | ||||||||||||||
Fair | Unrealized | Unrealized | Amortized | |||||||||||||
Value | Gains | (Losses) | Cost | |||||||||||||
Residential mortgage obligations: | ||||||||||||||||
Prime | $ | 29,053 | $ | — | $ | (5,644 | ) | $ | 34,697 | |||||||
Alt-A | 1,433 | — | (406 | ) | 1,839 | |||||||||||
Subprime | — | — | — | — | ||||||||||||
Total | $ | 30,486 | $ | — | $ | (6,050 | ) | $ | 36,536 | |||||||
Gross | Gross | Cost or | ||||||||||||||
Fair | Unrealized | Unrealized | Amortized | |||||||||||||
Value | Gains | (Losses) | Cost | |||||||||||||
Asset-backed securities: | ||||||||||||||||
Prime | $ | 11,155 | $ | 485 | $ | — | $ | 10,670 | ||||||||
Alt-A | — | — | — | — | ||||||||||||
Subprime | 128 | — | (34 | ) | 162 | |||||||||||
Total | $ | 11,283 | $ | 485 | $ | (34 | ) | $ | 10,832 | |||||||