Navigators (NAVG) 8-K Results of Operations and Financial Condition

Exhibit 99.1

The Navigators Group, Inc.

CORPORATE NEWS

Navigators Reports Fourth Quarter Earnings,

Operating Earnings up 89%

Stamford, CT – February 13, 2014 — The Navigators Group, Inc. (NASDAQ:NAVG) reported net income of $14.3 million, or $1.00 per diluted share, for the three months ended December 31, 2013 compared to $28.0 million, or $1.96 per diluted share, for the comparable period in 2012. Operating earnings were $16.1 million, or $1.13 per diluted share, for the fourth quarter of 2013 compared to $8.5 million, or $0.59 per diluted share, for the comparable period in 2012.

For the twelve months ended December 31, 2013, the Company reported net income of $63.5 million, or $4.42 per diluted share, compared to $63.8 million, or $4.45 per diluted share, for the comparable period in 2012. Operating earnings were $61.7 million, or $4.30 per diluted share, for the twelve months ended December 31, 2013 compared to $37.6 million, or $2.63 per diluted share, for the comparable period in 2012.

The results for the fourth quarter and year include an after-tax charge of $11.6 million for the payment of call premium in connection with the redemption of outstanding 7.0% Senior Notes due 2016. Excluding the call premium, net income for the fourth quarter would be $25.9 million, or $1.80 per diluted share, and for the year, would be $75.1 million, or $5.23 per diluted share.

Gross written premiums and net written premiums for the three months ended December 31, 2013 were $333.1 million and $223.4 million, respectively, an increase of 3.6% and 5.2% from the comparable period in 2012. Gross written premiums and net written premiums for the twelve months ended December 31, 2013 were $1.371 billion and $887.9 million, respectively, an increase of 6.5% for both from the comparable period in 2012.

The combined loss and expense ratio for the three and twelve months ended December 31, 2013 were 94.0% and 94.8%, respectively, compared to 100.2% and 99.3% for the comparable periods in 2012.

Stan Galanski, President and Chief Executive Officer, commented, “We are pleased to report strong operating performance with significantly improved underwriting profitability for the fourth quarter and for the full year of 2013, by both our Insurance Companies and Lloyd’s Operations. Operating earnings were up 89% for the fourth quarter of 2013 compared to 2012 and 64% for the twelve months. We produced profitable and improved combined ratios of 94% for the fourth quarter and 94.8% for the full year, with a meaningful contribution from our Insurance Company Marine business. We continue to experience strong premium growth in targeted specialty classes, most notably in Navigators Specialty, our U.S. excess & surplus lines unit, and in international D&O. We have continued to emphasize cost control, limiting the growth in non-commission operating expenses. During the quarter, we raised $265 million of capital through the issuance of 10 year, 5.75% senior notes, which allowed us to retire existing 7.00% senior notes due 2016. This debt issuance provided $131 million of incremental capital after redeeming the outstanding notes to enhance our capital efficiency. We believe this action effectively enhances Navigators’ position to continue to pursue targeted growth strategies in specialty classes, both in the U.S. and internationally.”

400 Atlantic Street TEL (203) 905-6090 Stamford, CT 06901 FAX (203) 658-1821

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February 13, 2014

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Stockholders’ equity was $902.2 million, or $63.54 per share, as of December 31, 2013 compared to $879.5 million, or $62.61 per share, as of December 31, 2012.

Net investment income for the three and twelve months ended December 31, 2013 was $14.3 million and $56.3 million, respectively, an increase of 4.7% and 3.7% from the comparable periods in 2012. Net investment income for the twelve months ended December 31, 2012 was reduced by $4.5 million as a result of the settlement of our dispute with Equitas over foregone interest on amounts that were due on certain reinsurance contracts. The annualized pre-tax investment yield, excluding net realized gains and losses, net other-than-temporary impairment losses recognized in earnings, and for 2012 the $4.5 million in interest expense for the settlement of our dispute with Equitas, was 2.3% and 2.4% for the three and twelve months ended December 31, 2013, respectively, compared to 2.3% and 2.6% for the comparable periods in 2012. The effective tax rate on net investment income was 27.8% for both the three and twelve months ended December 31, 2013, respectively, compared to 26.7% and 26.8% for the comparable periods in 2012.

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 3.7 years as of December 31, 2013. As of December 31, 2013, net unrealized gains within our investment portfolio were $36.0 million, a decrease of $67.3 million compared to December 31, 2012.

There were $15.2 million and $20.5 million of net realized gains including other-than-temporary impairment losses recognized in earnings for the three and twelve months ended December 31, 2013, respectively, compared to $30.0 million and $40.2 million for the same periods in 2012.

Consolidated net cash flow from operations for the three and twelve months ended December 31, 2013 was $6.9 million and $136.9 million, respectively, compared to $27.6 million and $96.7 million for the comparable periods in 2012.

The Company will hold a conference call on Friday, February 14, 2014 starting at 8:30 a.m. ET to discuss the 2013 fourth quarter results. The call will be available via live webcast on Navigators’ website (www.navg.com).

To participate by telephone, the domestic dial-in number is (800) 850-2903 and the international dial-in is (224) 357-2399. Participants may connect to the webcast at:

http://www.media-server.com/m/p/n8ezzwb2

Operating earnings, or net income excluding after-tax net realized gains (losses), net other-than-temporary impairment losses recognized in earnings, and the after-tax call premium charge in connection with the redemption of our 7.0% Senior Notes due May 1, 2016, 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.

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February 13, 2014

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The Navigators Group, Inc. is an international specialty insurance holding company with insurance company operations, underwriting management companies and operations at Lloyd’s. With its corporate headquarters in Connecticut and insurance operations based in New York and London, Navigators has offices in major insurance centers in the United States, the United Kingdom and Continental Europe, as well as representatives in China and Brazil.

The Navigators Group, Inc. logo is available athttp://www.globenewswire.com/newsroom/prs/?pkgid=7778

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:	Ciro M. DeFalco
	Senior Vice President and Chief Financial Officer
	(203) 905-6343
	cdefalco@navg.com
	www.navg.com

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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Financial Highlights

($ in thousands, except share and per share data)

(unaudited)

	Three Months Ended									Twelve Months Ended
	December 31,									December 31,
	2013			2012			Change			2013			2012			Change
Results of Operations
Gross written premiums	$	333,091		$	321,587			3.6	%	$	1,370,517		$	1,286,465			6.5	%
Net written premiums		223,445			212,312			5.2	%		887,922			833,655			6.5	%
Revenues:
Net earned premiums		219,902			201,566			9.1	%		841,939			781,964			7.7	%
Net investment income		14,254			13,616			4.7	%		56,251			54,248			3.7	%
Total other-than-temporary impairment losses		(530	)		(208	)		NM			(2,393	)		(902	)		NM
Portion of loss recognized in other comprehensive income (before tax)		—			—			NM			—			44			NM
Net other-than-temporary impairment losses recognized in earnings		(530	)		(208	)		NM			(2,393	)		(858	)		NM
Net realized gains (losses)		15,768			30,254			-47.9	%		22,939			41,074			-44.2	%
Other income		(665	)		(599	)		11.0	%		(1,172	)		1,488			NM
Total revenues		248,729			244,629			1.7	%		917,564			877,916			4.5	%
Expenses:
Net losses and loss adjustment expenses		131,385			127,191			3.3	%		518,961			497,433			4.3	%
Commission expenses		30,863			31,259			-1.3	%		113,494			121,470			-6.6	%
Other operating expenses		43,826			42,841			2.3	%		164,434			159,079			3.4	%
Call premium on Senior Notes		17,895			—			NM			17,895			—			NM
Interest expense		4,351			2,051			112.1	%		10,507			8,198			28.2	%
Total expenses		228,320			203,342			12.3	%		825,291			786,180			5.0	%
Income before income taxes		20,409			41,287			-50.6	%		92,273			91,736			0.6	%
Income tax expense (benefit)		6,076			13,243			-54.1	%		28,807			27,974			3.0	%
Net income (loss)	$	14,333		$	28,044			-48.9	%	$	63,466		$	63,762			-0.5	%
Per Share Data
Net income per common share:
Basic	$	1.01		$	2.00			-49.4	%	$	4.49		$	4.54			-1.0	%
Diluted	$	1.00		$	1.96			-48.7	%	$	4.42		$	4.45			-0.6	%
Average common shares outstanding:
Basic		14,172,908			14,042,553						14,133,925			14,052,311
Diluted		14,434,137			14,340,057						14,345,553			14,327,820
Underwriting Ratios
Loss Ratio		59.7	%		63.1	%					61.6	%		63.6	%
Expense Ratio		34.3	%		37.1	%					33.2	%		35.7	%
Combined Ratio		94.0	%		100.2	%					94.8	%		99.3	%
	Dec. 31,			Sept. 30,						Dec. 31,			Dec. 31,
	2013			2013						2013			2012
Balance Sheet Data
Stockholders’ equity	$	902,212		$	899,882			0.3	%	$	902,212		$	879,485			2.6	%
Book value per share	$	63.54		$	63.61			-0.1	%	$	63.54		$	62.61			1.5	%

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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

($ in thousands, except share data)

	December 31,			December 31,
	2013			2012
	(unaudited)
ASSETS
Investments and cash:
Fixed maturities, available-for-sale, at fair value (amortized cost: 2013, $2,036,999; 2012, $2,034,765)	$	2,047,873		$	2,121,833
Equity securities, available-for-sale, at fair value (cost: 2013, $118,804; 2012, $85,004)		143,954			101,297
Short-term investments, at cost which approximates fair value		296,250			153,788
Cash		86,509			45,336
Total investments and cash		2,574,586			2,422,254
Premiums receivable		325,025			320,182
Prepaid reinsurance premiums		247,822			221,015
Reinsurance recoverable on paid losses		38,384			49,282
Reinsurance recoverable on unpaid losses and loss adjustment expenses		822,438			880,139
Deferred policy acquisition costs		67,007			61,005
Accrued investment income		13,866			12,587
Goodwill and other intangible assets		7,177			7,093
Current income tax receivable, net		9,918			—
Deferred income tax, net		28,187			3,216
Receivable for investments sold		3			4,310
Other assets		35,039			26,587
Total assets	$	4,169,452		$	4,007,670
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Reserves for losses and loss adjustment expenses	$	2,045,071		$	2,097,048
Unearned premiums		714,606			642,407
Reinsurance balances payable		167,252			165,813
Senior notes		263,308			114,424
Payable for investments purchased		7,624			58,345
Accounts payable and other liabilities		69,379			48,015
Total liabilities		3,267,240			3,128,185
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 17,709,876 shares for 2013 and 17,558,046 shares for 2012		1,770			1,755
Additional paid-in capital		335,546			329,452
Treasury stock, at cost (3,511,380 shares for 2013 and 2012)		(155,801	)		(155,801	)
Retained earnings		692,337			628,871
Accumulated other comprehensive income		28,360			75,208
Total stockholders’ equity		902,212			879,485
Total liabilities and stockholders’ equity	$	4,169,452		$	4,007,670

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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Comparative Premium Data

($ in thousands)

	Three Months							Twelve Months
	2013		2012		Change			2013		2012			Change
Gross Written Premiums:
Insurance Companies:
Marine	$	38,986	$	43,455		-10.3	%	$	171,822	$	200,095			-14.1	%
Property Casualty		172,800		164,247		5.2	%		700,087		590,741			18.5	%
Professional Liability		32,687		32,860		-0.5	%		130,366		130,489			-0.1	%
Total Insurance Companies		244,473		240,562		1.6	%		1,002,275		921,325			8.8	%
Lloyd’s Operations:
Marine		45,500		47,895		-5.0	%		181,046		194,423			-6.9	%
Property Casualty		27,378		20,965		30.6	%		129,522		127,028			2.0	%
Professional Liability		15,740		12,165		29.4	%		57,674		43,689			32.0	%
Total Lloyd’s Operations		88,618		81,025		9.4	%		368,242		365,140			0.8	%
Total	$	333,091	$	321,587		3.6	%	$	1,370,517	$	1,286,465			6.5	%
	Three Months							Twelve Months
	2013		2012		Change			2013		2012			Change
Net Written Premiums:
Insurance Companies:
Marine	$	24,893	$	25,944		-4.1	%	$	119,837	$	133,210			-10.0	%
Property Casualty		124,727		115,345		8.1	%		462,942		390,168			18.7	%
Professional Liability		21,399		24,204		-11.6	%		97,229		99,578			-2.4	%
Total Insurance Companies		171,019		165,493		3.3	%		680,008		622,956			9.2	%
Lloyd’s Operations:
Marine		34,214		34,111		0.3	%		134,627		143,600			-6.2	%
Property Casualty		9,080		7,131		27.3	%		42,334		43,824	��		-3.4	%
Professional Liability		9,132		5,577		63.8	%		30,953		23,275			33.0	%
Total Lloyd’s Operations		52,426		46,819		12.0	%		207,914		210,699			-1.3	%
Total	$	223,445	$	212,312		5.2	%	$	887,922	$	833,655			6.5	%
	Three Months							Twelve Months
	2013		2012		Change			2013		2012			Change
Net Earned Premiums:
Insurance Companies:
Marine	$	29,263	$	30,779		-4.9	%	$	129,276	$	142,181			-9.1	%
Property Casualty		111,526		92,246		20.9	%		409,480		332,782			23.0	%
Professional Liability		24,709		26,199		-5.7	%		100,582		96,476			4.3	%
Total Insurance Companies		165,498		149,224		10.9	%		639,338		571,439			11.9	%
Lloyd’s Operations:
Marine		35,758		35,360		1.1	%		138,690		136,898			1.3	%
Property Casualty		10,809		11,307		-4.4	%		37,722		52,951			-28.8	%
Professional Liability		7,837		5,675		38.1	%		26,189		20,676			26.7	%
Total Lloyd’s Operations		54,404		52,342		3.9	%		202,601		210,525			-3.8	%
Total	$	219,902	$	201,566		9.1	%	$	841,939	$	781,964			7.7	%

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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Segment Information

Three Months Ended

December 31, 2013

($ in thousands)

	Insurance			Lloyd’s
	Companies			Operations			Corporate (1)			Total
Gross written premiums	$	244,473		$	88,618		$	—		$	333,091
Net written premiums		171,019			52,426			—			223,445
Net earned premiums		165,498			54,404			—			219,902
Net losses and loss adjustment expenses		(106,445	)		(24,940	)		—			(131,385	)
Commission expenses		(22,003	)		(9,465	)		605			(30,863	)
Other operating expenses		(32,238	)		(11,588	)		—			(43,826	)
Other income (expense)		461			(521	)		(605	)		(665	)
Underwriting profit (loss)		5,273			7,890			—			13,163
Net investment income		12,332			1,923			(1	)		14,254
Net realized gains (losses)		14,599			639			—			15,238
Call premium on Senior Notes		—			—			(17,895	)		(17,895	)
Interest expense		—			—			(4,351	)		(4,351	)
Income (loss) before income taxes		32,204			10,452			(22,247	)		20,409
Income tax expense (benefit)		10,411			3,608			(7,943	)		6,076
Net income (loss)	$	21,793		$	6,844		$	(14,304	)	$	14,333
Losses and loss adjustment expenses ratio		64.3	%		45.8	%					59.7	%
Commission expense ratio		13.3	%		17.4	%					14.0	%
Other operating expense ratio(2)		19.2	%		22.3	%					20.3	%
Combined ratio		96.8	%		85.5	%					94.0	%

(1) The Corporate segment includes intercompany eliminations.

(2) The Other operating expense ratio includes Other income (expense).

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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Segment Information

Three Months Ended

December 31, 2012

($ in thousands)

	Insurance Companies			Lloyd’s Operations			Corporate (1)			Total
Gross written premiums	$	240,562		$	81,025		$	—		$	321,587
Net written premiums		165,493			46,819			—			212,312
Net earned premiums		149,224			52,342			—			201,566
Net losses and loss adjustment expenses		(112,599	)		(14,592	)		—			(127,191	)
Commission expenses		(20,125	)		(11,714	)		580			(31,259	)
Other operating expenses		(29,979	)		(12,862	)		—			(42,841	)
Other income (expense)		40			(59	)		(580	)		(599	)
Underwriting profit (loss)		(13,439	)		13,115			—			(324	)
Net investment income		12,324			1,262			30			13,616
Net realized gains (losses)		29,659			194			193			30,046
Interest expense		—			—			(2,051	)		(2,051	)
Income (loss) before income taxes		28,544			14,571			(1,828	)		41,287
Income tax expense (benefit)		9,083			5,162			(1,002	)		13,243
Net income (loss)	$	19,461		$	9,409		$	(826	)	$	28,044
Losses and loss adjustment expenses ratio		75.5	%		27.9	%					63.1	%
Commission expense ratio		13.5	%		22.4	%					15.5	%
Other operating expense ratio(2)		20.0	%		24.6	%					21.6	%
Combined ratio		109.0	%		74.9	%					100.2	%

(1) The Corporate segment includes intercompany eliminations.

(2) The Other operating expense ratio includes Other income (expense).

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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Segment Information

Twelve Months Ended

December 31, 2013

($ in thousands)

	Insurance			Lloyd’s
	Companies			Operations			Corporate (1)			Total
Gross written premiums	$	1,002,275		$	368,242		$	—		$	1,370,517
Net written premiums		680,008			207,914			—			887,922
Net earned premiums		639,338			202,601			—			841,939
Net losses and loss adjustment expenses		(415,413	)		(103,548	)		—			(518,961	)
Commission expenses		(81,132	)		(34,710	)		2,348			(113,494	)
Other operating expenses		(119,920	)		(44,514	)		—			(164,434	)
Other income (expense)		2,764			(1,588	)		(2,348	)		(1,172	)
Underwriting profit (loss)		25,637			18,241			—			43,878
Net investment income		49,083			7,160			8			56,251
Net realized gains (losses)		20,600			(58	)		4			20,546
Call premium on Senior Notes		—			—			(17,895	)		(17,895	)
Interest expense		—			—			(10,507	)		(10,507	)
Income (loss) before income taxes		95,320			25,343			(28,390	)		92,273
Income tax expense (benefit)		29,965			8,728			(9,886	)		28,807
Net income (loss)	$	65,355		$	16,615		$	(18,504	)	$	63,466
Losses and loss adjustment expenses ratio		65.0	%		51.1	%					61.6	%
Commission expense ratio		12.7	%		17.1	%					13.5	%
Other operating expense ratio(2)		18.3	%		22.8	%					19.7	%
Combined ratio		96.0	%		91.0	%					94.8	%

(1) The Corporate segment includes intercompany eliminations.

(2) The Other operating expense ratio includes Other income (expense).

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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Segment Information

Twelve Months Ended

December 31, 2012

($ in thousands)

	Insurance			Lloyd’s
	Companies			Operations			Corporate (1)			Total
Gross written premiums	$	921,325		$	365,140		$	—		$	1,286,465
Net written premiums		622,956			210,699			—			833,655
Net earned premiums		571,439			210,525			—			781,964
Net losses and loss adjustment expenses		(417,082	)		(80,351	)		—			(497,433	)
Commission expenses		(81,370	)		(42,449	)		2,349			(121,470	)
Other operating expenses		(113,625	)		(45,454	)		—			(159,079	)
Other income (expense)		3,790			47			(2,349	)		1,488
Underwriting profit (loss)		(36,848	)		42,318			—			5,470
Net investment income		46,549			7,551			148			54,248
Net realized gains (losses)		36,468			3,555			193			40,216
Interest expense		—			—			(8,198	)		(8,198	)
Income (loss) before income taxes		46,169			53,424			(7,857	)		91,736
Income tax expense (benefit)		12,686			18,620			(3,332	)		27,974
Net income (loss)	$	33,483		$	34,804		$	(4,525	)	$	63,762
Losses and loss adjustment expenses ratio		73.0	%		38.2	%					63.6	%
Commission expense ratio		14.2	%		20.2	%					15.5	%
Other operating expense ratio(2)		19.2	%		21.5	%					20.2	%
Combined ratio		106.4	%		79.9	%					99.3	%

(1) The Corporate segment includes intercompany eliminations.

(2) The Other operating expense ratio includes Other income (expense).

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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Underwriting Results

($ in thousands)

	Three Months Ended December 31, 2013
	Net		Losses
	Earned		and LAE		Underwriting		Underwriting			Loss			Expense			Combined
	Premiums		Incurred		Expenses		Profit (Loss)			Ratio			Ratio			Ratio
Insurance Companies:
Marine	$	29,263	$	7,192	$	13,257	$	8,814			24.6	%		45.3	%		69.9	%
Property Casualty		111,526		84,379		31,816		(4,669	)		75.7	%		28.5	%		104.2	%
Professional Liability		24,709		14,874		8,707		1,128			60.2	%		35.2	%		95.4	%
Total Insurance Companies		165,498		106,445		53,780		5,273			64.3	%		32.5	%		96.8	%
Lloyd’s Operations:
Marine		35,758		17,270		15,111		3,377			48.3	%		42.3	%		90.6	%
Property Casualty		10,809		2,645		3,957		4,207			24.5	%		36.6	%		61.1	%
Professional Liability		7,837		5,025		2,506		306			64.1	%		32.0	%		96.1	%
Total Lloyd’s Operations		54,404		24,940		21,574		7,890			45.8	%		39.7	%		85.5	%
Total All	$	219,902	$	131,385	$	75,354	$	13,163			59.7	%		34.3	%		94.0	%
	Three Months Ended December 31, 2012
	Net		Losses
	Earned		and LAE		Underwriting		Underwriting			Loss			Expense			Combined
	Premiums		Incurred		Expenses		Profit (Loss)			Ratio			Ratio			Ratio
Insurance Companies:
Marine	$	30,779	$	22,879	$	15,048	$	(7,148	)		74.3	%		48.9	%		123.2	%
Property Casualty		92,246		70,394		25,535		(3,683	)		76.3	%		27.7	%		104.0	%
Professional Liability		26,199		19,326		9,481		(2,608	)		73.8	%		36.2	%		110.0	%
Total Insurance Companies		149,224		112,599		50,064		(13,439	)		75.5	%		33.5	%		109.0	%
Lloyd’s Operations:
Marine		35,360		5,892		16,523		12,945			16.7	%		46.7	%		63.4	%
Property Casualty		11,307		6,476		5,609		(778	)		57.3	%		49.6	%		106.9	%
Professional Liability		5,675		2,224		2,503		948			39.2	%		44.1	%		83.3	%
Total Lloyd’s Operations		52,342		14,592		24,635		13,115			27.9	%		47.0	%		74.9	%
Total All	$	201,566	$	127,191	$	74,699	$	(324	)		63.1	%		37.1	%		100.2	%

	Amounts						Loss Ratio
	Dec. 31, 2013			Dec. 31, 2012			Dec. 31, 2013			Dec. 31, 2012
Net Incurred Loss Activity For the Three Months Ended:
Insurance Companies:
Loss and LAE payments	$	135,161		$	120,293			81.7	%		80.7	%
Change in reserves		(28,716	)		(7,694	)		-17.4	%		-5.2	%
Net incurred loss and LAE		106,445			112,599			64.3	%		75.5	%
Lloyd’s Operations:
Loss and LAE payments		29,424			35,341			54.1	%		67.5	%
Change in reserves		(4,484	)		(20,749	)		-8.3	%		-39.6	%
Net incurred loss and LAE		24,940			14,592			45.8	%		27.9	%
Total
Loss and LAE payments		164,585			155,634			74.8	%		77.2	%
Change in reserves		(33,200	)		(28,443	)		-15.1	%		-14.1	%
Net incurred loss and LAE	$	131,385		$	127,191			59.7	%		63.1	%
	Amounts						Loss Ratio Impact
	Dec. 31, 2013			Dec. 31, 2012			Dec. 31, 2013			Dec. 31, 2012
Impact of Prior Years Reserves Favorable / (Unfavorable) Development For the Three Months Ended:
Insurance Companies	$	(1,047	)	$	(379	)		-0.5	%		-0.2	%
Lloyd’s Operations		624			27,955			0.3	%		13.9	%
Total	$	(423	)	$	27,576			-0.2	%		13.7	%

News Release

Page 12

THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Underwriting Results

($ in thousands)

	Twelve Months Ended December 31, 2013
	Net		Losses
	Earned		and LAE		Underwriting		Underwriting			Loss			Expense			Combined
	Premiums		Incurred		Expenses		Profit (Loss)			Ratio			Ratio			Ratio
Insurance Companies:
Marine	$	129,276	$	62,617	$	50,206	$	16,453			48.4	%		38.9	%		87.3	%
Property Casualty		409,480		280,530		114,660		14,290			68.5	%		28.0	%		96.5	%
Professional Liability		100,582		72,266		33,422		(5,106	)		71.8	%		33.3	%		105.1	%
Total Insurance Companies		639,338		415,413		198,288		25,637			65.0	%		31.0	%		96.0	%
Lloyd’s Operations:
Marine		138,690		76,454		56,377		5,859			55.1	%		40.7	%		95.8	%
Property Casualty		37,722		13,852		16,066		7,804			36.7	%		42.6	%		79.3	%
Professional Liability		26,189		13,242		8,369		4,578			50.6	%		31.9	%		82.5	%
Total Lloyd’s Operations		202,601		103,548		80,812		18,241			51.1	%		39.9	%		91.0	%
Total All	$	841,939	$	518,961	$	279,100	$	43,878			61.6	%		33.2	%		94.8	%
	Twelve Months Ended December 31, 2012
	Net		Losses
	Earned		and LAE		Underwriting		Underwriting			Loss			Expense			Combined
	Premiums		Incurred		Expenses		Profit (Loss)			Ratio			Ratio			Ratio
Insurance Companies:
Marine	$	142,181	$	110,119	$	55,419	$	(23,357	)		77.4	%		39.0	%		116.4	%
Property Casualty		332,782		235,740		100,770		(3,728	)		70.8	%		30.3	%		101.1	%
Professional Liability		96,476		71,223		35,016		(9,763	)		73.8	%		36.3	%		110.1	%
Total Insurance Companies		571,439		417,082		191,205		(36,848	)		73.0	%		33.4	%		106.4	%
Lloyd’s Operations:
Marine		136,898		51,116		59,110		26,672			37.3	%		43.2	%		80.5	%
Property Casualty		52,951		23,689		20,030		9,232			44.7	%		37.9	%		82.6	%
Professional Liability		20,676		5,546		8,716		6,414			26.8	%		42.2	%		69.0	%
Total Lloyd’s Operations		210,525		80,351		87,856		42,318			38.2	%		41.7	%		79.9	%
Total All	$	781,964	$	497,433	$	279,061	$	5,470			63.6	%		35.7	%		99.3	%

	Amounts						Loss Ratio
	Dec. 31,			Dec. 31,			Dec. 31,			Dec. 31,
	2013			2012			2013			2012
Net Incurred Loss Activity For the Twelve Months Ended:
Insurance Companies:
Loss and LAE payments	$	398,993		$	403,113			62.4	%		70.6	%
Change in reserves		16,420			13,969			2.6	%		2.4	%
Net incurred loss and LAE		415,413			417,082			65.0	%		73.0	%
Lloyd’s Operations:
Loss and LAE payments		114,350			114,645			56.4	%		54.5	%
Change in reserves		(10,802	)		(34,294	)		-5.3	%		-16.3	%
Net incurred loss and LAE		103,548			80,351			51.1	%		38.2	%
Total
Loss and LAE payments		513,343			517,758			61.0	%		66.2	%
Change in reserves		5,618			(20,325	)		0.6	%		-2.6	%
Net incurred loss and LAE	$	518,961		$	497,433			61.6	%		63.6	%
	Amounts						Loss Ratio Impact
	Dec. 31,			Dec. 31,			Dec. 31,			Dec. 31,
	2013			2012			2013			2012
Impact of Prior Years Reserves Favorable / (Unfavorable) Development For the Twelve Months Ended:
Insurance Companies	$	(13,430	)	$	(1,896	)		-1.6	%		-0.2	%
Lloyd’s Operations		14,696			47,187			1.7	%		6.0	%
Total	$	1,266		$	45,291			0.1	%		5.8	%

News Release

Page 13

THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Net Loss Data

($ in thousands)

	Case		IBNR
	Reserves		Reserves		Total
Net Loss Reserves, December 31, 2013:
Insurance Companies:
Marine	$	122,909	$	101,077	$	223,986
Property Casualty		150,477		377,173		527,650
Professional Liability		61,117		89,865		150,982
Total Insurance Companies		334,503		568,115		902,618
Lloyd’s Operations:
Marine		133,060		85,685		218,745
Property Casualty		25,870		18,271		44,141
Professional Liability		14,013		43,116		57,129
Total Lloyd’s Operations		172,943		147,072		320,015
Total Net Loss Reserves	$	507,446	$	715,187	$	1,222,633
	Case Reserves		IBNR Reserves		Total
Net Loss Reserves, December 31, 2012
Insurance Companies:
Marine	$	137,934	$	114,236	$	252,170
Property Casualty		204,988		290,455		495,443
Professional Liability		54,092		84,493		138,585
Total Insurance Companies		397,014		489,184		886,198
Lloyd’s Operations:
Marine		125,884		95,122		221,006
Property Casualty		27,903		28,463		56,366
Professional Liability		14,694		38,645		53,339
Total Lloyd’s Operations		168,481		162,230		330,711
Total Net Loss Reserves	$	565,495	$	651,414	$	1,216,909

News Release

Page 14

THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Investment Data

December 31, 2013

As of December 31, 2013, the average quality of the investment portfolio as rated by S&P and Moody’s was AA/Aa with an average duration of 3.7 years. The Company does not own any collateralized debt obligations (CDO’s) or asset backed commercial paper.

As of December 31, 2013, the Company owned two asset-backed securities approximating $0.5 million with subprime mortgage exposures. The securities have an effective maturity of 2.3 years. In addition, the Company owned a total of seven collateralized mortgage obligations and asset-backed securities approximating $1.9 million classified as Alt-A which is a credit category between prime and subprime. They have an effective maturity of 7.7 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 as of December 31, 2013:

				Gross		Gross
	��	Fair		Unrealized		Unrealized			Amortized
December 31, 2013		Value		Gains		(Losses)			Cost
		($ in thousands)
Fixed maturities:
U.S. Treasury bonds, agency bonds and foreign government bonds		$	441,685	$	2,854	$	(8,855	)	$	447,686
States, municipalities and political subdivisions			460,422		9,298		(13,651	)		464,775
Mortgage- and asset-backed securities:
Agency mortgage-backed securities			301,274		6,779		(6,016	)		300,511
Residential mortgage obligations			41,755		1,212		(161	)		40,704
Asset-backed securities			125,133		653		(480	)		124,960
Commercial mortgage-backed securities			172,750		7,656		(374	)		165,468
Subtotal			640,912		16,300		(7,031	)		631,643
Corporate bonds			504,854		15,402		(3,443	)		492,895
Total fixed maturities			2,047,873		43,854		(32,980	)		2,036,999
Equity securities—common stocks			143,954		25,700		(550	)		118,804
Short-term investments			296,250		—		—			296,250
Cash			86,509		—		—			86,509
Total		$	2,574,586	$	69,554	$	(33,530	)	$	2,538,562

News Release

Page 15

THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Investment Data

December 31, 2013

($ in thousands)

The following tables set forth our agency mortgage-backed securities and residential mortgage obligations, categorized by those issued by GNMA, FNMA and FHLMC and the quality category (prime, Alt-A and subprime) for all other such investments at December 31, 2013:

			Gross		Gross
	Fair		Unrealized		Unrealized			Amortized
	Value		Gains		(Losses)			Cost
Agency mortgage-backed securities:
GNMA	$	122,079	$	2,707	$	(3,645	)	$	123,017
FNMA		132,731		3,232		(2,058	)		131,557
FHLMC		46,464		840		(313	)		45,937
Total	$	301,274	$	6,779	$	(6,016	)	$	300,511
			Gross		Gross
	Fair		Unrealized		Unrealized			Amortized
	Value		Gains		(Losses)			Cost
Residential mortgage obligations:
Prime	$	17,932	$	500	$	(137	)	$	17,569
Alt-A		1,885		77		(24	)		1,832
Subprime		543		14		—			529
Non-US RMBS		21,395		621		—			20,774
Total	$	41,755	$	1,212	$	(161	)	$	40,704