Navigators (NAVG) 8-K Navigators Reports Fourth Quarter and Full Year 2014

Exhibit 99.1

The Navigators Group, Inc.

CORPORATE NEWS

Navigators Reports Fourth Quarter and Full Year 2014

Earnings, Record Earnings Per Share

Stamford, CT – February 11, 2015 — The Navigators Group, Inc. (NASDAQ:NAVG) reported net income of $19.3 million, or $1.31 per diluted share, for the three months ended December 31, 2014 compared to $14.3 million, or $1.00 per diluted share, for the comparable period in 2013. Net operating earnings were $18.4 million, or $1.25 per diluted share, for the fourth quarter of 2014 compared to $16.1 million, or $1.13 per diluted share, for the comparable period in 2013.

For the twelve months ended December 31, 2014, the Company reported net income of $95.3 million, or $6.51 per diluted share compared to $63.5 million, or $4.42 per diluted share, for the comparable period in 2013. Net operating earnings were $80.5 million, or $5.49 per diluted share, for the twelve months ended December 31, 2014 compared to $61.7 million, or $4.30 per diluted share, for the comparable period in 2013.

Gross written premiums and net written premiums for the three months ended December 31, 2014 were $333.3 million and $228.0 million, respectively, an increase of 0.1% and 2.0% from the comparable period in 2013.

Gross written premiums and net written premiums for the twelve months ended December 31, 2014 were $1.4 billion and $1.0 billion, respectively, an increase of 4.5% and 12.6% from the comparable period in 2013.

The combined loss and expense ratio for the three and twelve months ended December 31, 2014 was 93.8% and 92.6%, respectively, compared to 94.0% and 94.8% for the comparable periods in 2013.

“Our profitable fourth quarter results capped an excellent year for Navigators, as we achieved our eighth consecutive quarter of underwriting profit,” said Stan Galanski, President and Chief Executive Officer. “We are pleased with our 2014 financial performance in which book value per share increased by 13.2%, the combined ratio improved to 92.6% and diluted earnings per share increased by 47.1% to a record $6.51.”

Stockholders’ equity was $1.0 billion, or $71.93 per share, as of December 31, 2014 compared to $902.2 million, or $63.54 per share, as of December 31, 2013.

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

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Net investment income for the three and twelve months ended December 31, 2014 was $16.1 million and $64.2 million, respectively, an increase of 12.7% and 14.1% from the comparable periods in 2013. The annualized pre-tax investment yield, excluding net realized gains and losses, was 2.3% for both the three and twelve months ended December 31, 2014, compared to 2.3% and 2.4% for each of the comparable periods in 2013. The effective tax rate on net investment income for the three and twelve months ended December 31, 2014 was 27.2% and 27.4%, respectively.

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 3.8 years as of December 31, 2014. As of December 31, 2014, net unrealized gains within our investment portfolio were $71.4 million, an increase of $35.4 million compared to December 31, 2013.

There were $0.8 million and $12.8 million of net realized gains, including other-than-temporary impairment losses recognized in earnings, for the three and twelve months ended December 31, 2014, respectively, compared to $15.2 million and $20.5 million for the same periods in 2013.

Other income for the twelve months ended December 31, 2014 includes a one-time foreign exchange gain of $10.0 million ($6.6 million after-tax) due to a change in the functional currency of our Lloyd’s Operations, which is equally offset by a reversal within the Accumulated Other Comprehensive Income component of stockholders’ equity.

Consolidated net cash flow from operations for the three and twelve months ended December 31, 2014 was $41.1 million and $222.5 million, respectively, compared to $6.9 million and $136.9 million for the comparable periods in 2013.

The Company will hold a conference call on Thursday, February 12, 2015 starting at 8:30 a.m. ET to discuss the 2014 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 (888-428-9473) and the international dial-in is (719) 325-2495. Participants may connect to the webcast at:

http://edge.media-server.com/m/p/vprqdsnq

Net operating earnings, or net income excluding after-tax net realized gains (losses), after-tax net other-than-temporary impairment losses recognized in earnings, and after-tax foreign exchange gains and losses resulting from foreign currency transactions (transactions denominated in a currency other than the entity’s functional currency) and translation adjustments (translation of foreign currency denominated assets and liabilities into the entity’s functional currency), 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 Navigators Group, Inc. is an international specialty insurance holding company with insurance company operations, underwriting management companies and operations at Lloyd’s. Navigators has offices in the United States, the United Kingdom and Continental Europe, as well as representative offices in China and Brazil.

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

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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:	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,
Results of Operations	2014			2013			Change			2014			2013			Change
Gross written premiums	$	333,299		$	333,091			0.1	%	$	1,432,353		$	1,370,517			4.5	%
Net written premiums		228,007			223,445			2.0	%		1,000,138			887,922			12.6	%
Revenues:
Net earned premiums		234,172			219,902			6.5	%		935,895			841,939			11.2	%
Net investment income		16,071			14,254			12.7	%		64,168			56,251			14.1	%
Total other-than-temporary impairment losses		(21	)		(530	)		-96.0	%		137			(2,393	)		NM
Portion of loss recognized in other comprehensive income (before tax)		21			—			NM			(137	)		—			NM
Net other-than-temporary impairment losses recognized in earnings		—			(530	)		NM			—			(2,393	)		NM
Net realized gains (losses)		788			15,768			-95.0	%		12,812			22,939			-44.1	%
Other income		586			(665	)		NM			10,656			(1,172	)		NM
Total revenues		251,617			248,729			1.2	%		1,023,531			917,564			11.5	%
Expenses:
Net losses and loss adjustment expenses		134,658			131,385			2.5	%		545,229			518,961			5.1	%
Commission expenses		33,708			30,863			9.2	%		125,528			113,494			10.6	%
Other operating expenses		51,299			43,826			17.1	%		196,825			164,434			19.7	%
Call premium on Senior Notes		—			17,895			NM			—			17,895			NM
Interest expense		3,854			4,351			-11.4	%		15,413			10,507			46.7	%
Total expenses		223,519			228,320			-2.1	%		882,995			825,291			7.0	%
Income before income taxes		28,098			20,409			37.7	%		140,536			92,273			52.3	%
Income tax expense (benefit)		8,823			6,076			45.2	%		45,207			28,807			56.9	%
Net income (loss)	$	19,275		$	14,333			34.5	%	$	95,329		$	63,466			50.2	%
Per Share Data
Net income per common share:
Basic	$	1.35		$	1.01			33.5	%	$	6.69		$	4.49			48.9	%
Diluted	$	1.31		$	1.00			30.6	%	$	6.51		$	4.42			47.1	%
Average common shares outstanding:
Basic		14,280,045			14,172,908						14,259,768			14,133,925
Diluted		14,715,265			14,434,137						14,646,369			14,345,553
Underwriting Ratios
Loss Ratio		57.5	%		59.7	%					58.3	%		61.6	%
Expense Ratio		36.3	%		34.3	%					34.3	%		33.2	%
Combined Ratio		93.8	%		94.0	%					92.6	%		94.8	%
Balance Sheet Data	Dec. 31, 2014			Sep. 30, 2014						Dec. 31, 2014			Dec. 31, 2013
Stockholders’ equity	$	1,027,224		$	996,593			3.1	%	$	1,027,224		$	902,212			13.9	%
Book value per share	$	71.93		$	69.85			3.0	%	$	71.93		$	63.54			13.2	%

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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

($ in thousands, except share data)

	December 31,			December 31,
	2014			2013
	(unaudited)
ASSETS
Investments and cash:
Fixed maturities, available-for-sale, at fair value (amortized cost: 2014, $2,323,959; 2013, $2,036,999)	$	2,365,934		$	2,047,873
Equity securities, available-for-sale, at fair value (cost: 2014, $154,843; 2013, $118,804)		184,295			143,954
Short-term investments, at fair value (amortized cost: 2014: $179,527; 2013: $296,250)		179,506			296,250
Cash		90,751			86,509
Total investments and cash		2,820,486			2,574,586
Premiums receivable		342,479			325,025
Prepaid reinsurance premiums		237,851			247,822
Reinsurance recoverable on paid losses		51,347			38,384
Reinsurance recoverable on unpaid losses and loss adjustment expenses		851,498			822,438
Deferred policy acquisition costs		79,452			67,007
Accrued investment income		14,791			13,866
Goodwill and other intangible assets		7,013			7,177
Current income tax receivable, net		14,549			14,299
Deferred income tax, net		—			23,806
Receivable for investments sold		326			3
Other assets		44,384			35,039
Total assets	$	4,464,176		$	4,169,452
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Reserves for losses and loss adjustment expenses	$	2,159,634		$	2,045,071
Unearned premiums		766,167			714,606
Reinsurance balances payable		152,774			167,252
Senior notes		263,440			263,308
Deferred income tax, net		1,467			—
Payable for investments purchased		134			7,624
Accounts payable and other liabilities		93,336			69,379
Total liabilities		3,436,952			3,267,240
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 17,792,846 shares for 2014 and 17,709,876 shares for 2013		1,778			1,770
Additional paid-in capital		347,022			335,546
Treasury stock, at cost (3,511,380 shares for 2014 and 2013)		(155,801	)		(155,801	)
Retained earnings		787,666			692,337
Accumulated other comprehensive income		46,559			28,360
Total stockholders’ equity		1,027,224			902,212
Total liabilities and stockholders’ equity	$	4,464,176		$	4,169,452

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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Comparative Premium Data

($ in thousands)

	Three Months							Twelve Months
Gross Written Premiums:	2014		2013		Change			2014		2013		Change
Insurance Companies:
Marine	$	38,285	$	38,986		-1.8	%	$	177,363	$	171,822		3.2	%
Property Casualty		182,238		172,800		5.5	%		755,059		700,087		7.9	%
Professional Liability		26,922		32,687		-17.6	%		113,032		130,366		-13.3	%
		247,445		244,473		1.2	%		1,045,454		1,002,275		4.3	%
Lloyd’s Operations:
Marine		40,577		45,500		-10.8	%		188,107		181,046		3.9	%
Property Casualty		24,603		27,378		-10.1	%		126,016		129,522		-2.7	%
Professional Liability		20,674		15,740		31.3	%		72,776		57,674		26.2	%
		85,854		88,618		-3.1	%		386,899		368,242		5.1	%
Total	$	333,299	$	333,091		0.1	%	$	1,432,353	$	1,370,517		4.5	%
Net Written Premiums:	Three Months							Twelve Months
	2014		2013		Change			2014		2013		Change
Insurance Companies:
Marine	$	22,970	$	24,893		-7.7	%	$	123,617	$	119,837		3.2	%
Property Casualty		136,185		124,727		9.2	%		554,844		462,942		19.9	%
Professional Liability		13,142		21,399		-38.6	%		74,312		97,229		-23.6	%
		172,297		171,019		0.7	%		752,773		680,008		10.7	%
Lloyd’s Operations:
Marine		30,389		34,214		-11.2	%		144,327		134,627		7.2	%
Property Casualty		11,233		9,080		23.7	%		55,917		42,334		32.1	%
Professional Liability		14,088		9,132		54.3	%		47,121		30,953		52.2	%
		55,710		52,426		6.3	%		247,365		207,914		19.0	%
Total	$	228,007	$	223,445		2.0	%	$	1,000,138	$	887,922		12.6	%
Net Earned Premiums:	Three Months							Twelve Months
	2014		2013		Change			2014		2013		Change
Insurance Companies:
Marine	$	27,568	$	29,263		-5.8	%	$	123,203	$	129,276		-4.7	%
Property Casualty		131,141		111,526		17.6	%		496,209		409,480		21.2	%
Professional Liability		19,518		24,709		-21.0	%		85,162		100,582		-15.3	%
		178,227		165,498		7.7	%		704,574		639,338		10.2	%
Lloyd’s Operations:
Marine		31,003		35,758		-13.3	%		141,471		138,690		2.0	%
Property Casualty		13,937		10,809		28.9	%		51,338		37,722		36.1	%
Professional Liability		11,005		7,837		40.4	%		38,512		26,189		47.1	%
		55,945		54,404		2.8	%		231,321		202,601		14.2	%
Total	$	234,172	$	219,902		6.5	%	$	935,895	$	841,939		11.2	%

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THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Segment Information

Three Months Ended

December 31, 2014

($ in thousands)

	Insurance			Lloyd’s
	Companies			Operations			Corporate (1)			Total
Gross written premiums	$	247,445		$	85,854		$	—		$	333,299
Net written premiums		172,297			55,710			—			228,007
Net earned premiums		178,227			55,945			—			234,172
Net losses and loss adjustment expenses		(111,042	)		(23,616	)		—			(134,658	)
Commission expenses		(22,701	)		(11,569	)		562			(33,708	)
Other operating expenses		(35,712	)		(15,587	)		—			(51,299	)
Other underwriting income (expense)		645			15			(562	)		98
Underwriting profit (loss)		9,417			5,188			—			14,605
Net investment income		14,161			1,890			20			16,071
Net realized gains (losses)		347			441			—			788
Call premium on Senior Notes		—			—			—			—
Interest expense		—			—			(3,854	)		(3,854	)
Other income (expense)		(1,063	)		1,551			—			488
Income (loss) before income taxes		22,862			9,070			(3,834	)		28,098
Income tax expense (benefit)		6,959			3,132			(1,268	)		8,823
Net income (loss)	$	15,903		$	5,938		$	(2,566	)	$	19,275
Losses and loss adjustment expenses ratio		62.3	%		42.2	%					57.5	%
Commission expense ratio		12.7	%		20.7	%					14.4	%
Other operating expense ratio(2)		19.7	%		27.8	%					21.9	%
Combined ratio		94.7	%		90.7	%					93.8	%

(1) The Corporate segment includes intercompany eliminations.

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

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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 underwriting 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	)
Other income (expense)		—			—			—			—
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

Twelve Months Ended

December 31, 2014

($ in thousands)

	Insurance			Lloyd’s
	Companies			Operations			Corporate (1)			Total
Gross written premiums	$	1,045,454		$	386,899		$	—		$	1,432,353
Net written premiums		752,773			247,365			—			1,000,138
Net earned premiums		704,574			231,321			—			935,895
Net losses and loss adjustment expenses		(434,396	)		(110,833	)		—			(545,229	)
Commission expenses		(85,137	)		(42,558	)		2,167			(125,528	)
Other operating expenses		(138,675	)		(58,150	)		—			(196,825	)
Other underwriting income (expense)		2,727			35			(2,167	)		595
Underwriting profit (loss)		49,093			19,815			—			68,908
Net investment income		56,714			7,378			76			64,168
Net realized gains (losses)		12,715			97			—			12,812
Call premium on Senior Notes		—			—			—			—
Interest expense		—			—			(15,413	)		(15,413	)
Other income (expense)		(2,182	)		12,243			—			10,061
Income (loss) before income taxes		116,340			39,533			(15,337	)		140,536
Income tax expense (benefit)		36,609			13,885			(5,287	)		45,207
Net income (loss)	$	79,731			25,648		$	(10,050	)	$	95,329
Losses and loss adjustment expenses ratio		61.7	%		47.9	%					58.3	%
Commission expense ratio		12.1	%		18.4	%					13.4	%
Other operating expense ratio(2)		19.2	%		25.1	%					20.9	%
Combined ratio		93.0	%		91.4	%					92.6	%

(1) The Corporate segment includes intercompany eliminations.

(2) The Other operating expense ratio includes Other underwriting 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 underwriting 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	)
Other income (expense)		—			—			—			—
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

Underwriting Results

($ in thousands)

	Three Months Ended December 31, 2014
	Net Earned Premiums		Losses and LAE Incurred		Underwriting Expenses		Underwriting Profit (Loss)			Loss Ratio			Expense Ratio			Combined Ratio
Insurance Companies:
Marine	$	27,568	$	4,515	$	11,283	$	11,770			16.4	%		40.9	%		57.3	%
Property Casualty		131,141		93,759		38,107		(725	)		71.5	%		29.1	%		100.6	%
Professional Liability		19,518		12,768		8,378		(1,628	)		65.4	%		42.9	%		108.3	%
Total Insurance Companies		178,227		111,042		57,768		9,417			62.3	%		32.4	%		94.7	%
Lloyd’s Operations:
Marine		31,003		14,537		15,141		1,325			46.9	%		48.8	%		95.7	%
Property Casualty		13,937		3,220		7,407		3,310			23.1	%		53.2	%		76.3	%
Professional Liability		11,005		5,859		4,593		553			53.2	%		41.8	%		95.0	%
Total Lloyd’s		55,945		23,616		27,141		5,188			42.2	%		48.5	%		90.7	%
Total All	$	234,172	$	134,658	$	84,909	$	14,605			57.5	%		36.3	%		93.8	%
	Three Months Ended December 31, 2013
	Net Earned Premiums		Losses and LAE Incurred		Underwriting Expenses		Underwriting Profit (Loss)			Loss Ratio			Expense Ratio			Combined 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		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	%

	Amounts						Loss Ratio
Net Incurred Loss Activity For the Three Months Ended:	Dec. 31, 2014			Dec. 31, 2013			Dec. 31, 2014			Dec. 31, 2013
Insurance Companies:
Loss and LAE payments	$	106,984		$	135,161			60.0	%		81.7	%
Change in reserves		4,058			(28,716	)		2.3	%		-17.4	%
Net incurred loss and LAE		111,042			106,445			62.3	%		64.3	%
Lloyd’s Operations:
Loss and LAE payments		34,984			29,424			62.5	%		54.1	%
Change in reserves		(11,368	)		(4,484	)		-20.3	%		-8.3	%
Net incurred loss and LAE		23,616			24,940			42.2	%		45.8	%
Total
Loss and LAE payments		141,968			164,585			60.6	%		74.8	%
Change in reserves		(7,310	)		(33,200	)		-3.1	%		-15.1	%
Net incurred loss and LAE	$	134,658		$	131,385			57.5	%		59.7	%
Impact of Prior Years Reserves Favorable / (Unfavorable) Development For the Three Months Ended:	Amounts						Loss Ratio Impact
	Dec. 31, 2014			Dec. 31, 2013			Dec. 31, 2014			Dec. 31, 2013
Insurance Companies	$	7,038		$	(1,047	)		3.0	%		-0.5	%
Lloyd’s Operations		12,751			624			5.4	%		0.3	%
Total	$	19,789		$	(423	)		8.4	%		-0.2	%

News Release

Page 12

THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Underwriting Results

($ in thousands)

	Twelve Months Ended December 31, 2014
	Net Earned Premiums		Losses and LAE Incurred		Underwriting Expenses		Underwriting Profit (Loss)			Loss Ratio			Expense Ratio			Combined Ratio
Insurance Companies:
Marine	$	123,203	$	46,169	$	46,226	$	30,808			37.5	%		37.5	%		75.0	%
Property Casualty		496,209		337,961		142,131		16,117			68.1	%		28.7	%		96.8	%
Professional Liability		85,162		50,266		32,728		2,168			59.0	%		38.5	%		97.5	%
Total Insurance Companies		704,574		434,396		221,085		49,093			61.7	%		31.3	%		93.0	%
Lloyd’s Operations:
Marine		141,471		74,569		60,633		6,269			52.7	%		42.9	%		95.6	%
Property Casualty		51,338		17,235		24,517		9,586			33.6	%		47.7	%		81.3	%
Professional Liability		38,512		19,029		15,523		3,960			49.4	%		40.3	%		89.7	%
Total Lloyd’s		231,321		110,833		100,673		19,815			47.9	%		43.5	%		91.4	%
Total All	$	935,895	$	545,229	$	321,758	$	68,908			58.3	%		34.3	%		92.6	%
	Twelve Months Ended December 31, 2013
	Net Earned Premiums		Losses and LAE Incurred		Underwriting Expenses		Underwriting Profit (Loss)			Loss Ratio			Expense Ratio			Combined 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		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	%

	Amounts					Loss Ratio
Net Incurred Loss Activity For the Twelve Months Ended:	Dec. 31, 2014		Dec. 31, 2013			Dec. 31, 2014			Dec. 31, 2013
Insurance Companies:
Loss and LAE payments	$	344,093	$	398,993			48.9	%		62.4	%
Change in reserves		90,303		16,420			12.8	%		2.6	%
Net incurred loss and LAE		434,396		415,413			61.7	%		65.0	%
Lloyd’s Operations:
Loss and LAE payments		110,240		114,350			47.6	%		56.4	%
Change in reserves		593		(10,802	)		0.3	%		-5.3	%
Net incurred loss and LAE		110,833		103,548			47.9	%		51.1	%
Total
Loss and LAE payments		454,333		513,343			48.6	%		61.0	%
Change in reserves		90,896		5,618			9.7	%		0.6	%
Net incurred loss and LAE	$	545,229	$	518,961			58.3	%		61.6	%
Impact of Prior Years Reserves Favorable / (Unfavorable) Development For the Twelve Months Ended:	Amounts					Loss Ratio Impact
	Dec. 31, 2014		Dec. 31, 2013			Dec. 31, 2014			Dec. 31, 2013
Insurance Companies	$	30,312	$	(13,430	)		3.2	%		-1.6	%
Lloyd’s Operations		25,500		14,696			2.7	%		1.7	%
Total	$	55,812	$	1,266			5.9	%		0.1	%

News Release

Page 13

THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Net Loss Data

($ in thousands)

Net Loss Reserves, December 31, 2014:	Case Reserves		IBNR Reserves		Total
Insurance Companies:
Marine	$	116,652	$	78,091	$	194,743
Property Casualty		176,016		479,304		655,320
Professional Liability		56,594		86,264		142,858
Total Insurance Companies		349,262		643,659		992,921
Lloyd’s Operations:
Marine		145,366		69,095	$	214,461
Property Casualty		22,376		17,187		39,563
Professional Liability		12,374		48,817		61,191
Total Lloyd’s Operations		180,116		135,099		315,215
Total Net Loss Reserves	$	529,378	$	778,758	$	1,308,136
Net Loss Reserves, December 31, 2013	Case Reserves		IBNR Reserves		Total
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

News Release

Page 14

THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Investment Data

December 31, 2014

As of December 31, 2014, the average quality of the investment portfolio as rated by S&P and Moody’s was AA/Aa with an average duration of 3.8 years. The Company does not own any collateralized debt obligations (CDO’s) or asset backed commercial paper.

As of December 31, 2014, the Company owned two collateralized mortgage obligations approximating $0.4 million with subprime mortgage exposures. The securities have an effective maturity of 3.2 years. In addition, the Company owned a total of seven collateralized mortgage obligations and asset-backed securities approximating $1.7 million classified as Alt-A which is a credit category between prime and subprime. They have an effective maturity of 5.5 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, 2014:

December 31, 2014	Fair Value		Gross Unrealized Gains		Gross Unrealized (Losses)			Cost or Amortized Cost
	($ in thousands)
Fixed maturities:
U.S. Treasury bonds, agency bonds and foreign government bonds	$	397,923	$	3,431	$	(5,965	)	$	400,457
States, municipalities and political subdivisions		541,007		19,204		(558	)		522,361
Mortgage- and asset-backed securities:
Agency mortgage-backed securities		364,622		8,476		(998	)		357,144
Residential mortgage obligations		34,087		1,153		(138	)		33,072
Asset-backed securities		206,413		380		(964	)		206,997
Commercial mortgage-backed securities		206,318		6,630		(98	)		199,786
Subtotal		811,440		16,639		(2,198	)		796,999
Corporate bonds		615,564		13,048		(1,626	)		604,142
Total fixed maturities		2,365,934		52,322		(10,347	)		2,323,959
Equity securities - common stocks		127,183		28,520		(1,254	)		99,917
Equity securities - preferred stocks		57,112		2,236		(50	)		54,926
Short-term investments		179,506		—		(21	)		179,527
Cash		90,751		—		—			90,751
Total	$	2,820,486	$	83,078	$	(11,672	)	$	2,749,080

News Release

Page 15

THE NAVIGATORS GROUP, INC. AND SUBSIDIARIES

Investment Data

December 31, 2014

($ 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, 2014:

Agency mortgage-backed securities:	Fair Value		Gross Unrealized Gains		Gross Unrealized (Losses)			Cost or Amortized Cost
GNMA	$	83,452	$	2,865	$	(772	)	$	81,359
FNMA		216,133		4,059		(162	)		212,236
FHLMC		65,037		1,552		(64	)		63,549
Total	$	364,622	$	8,476	$	(998	)	$	357,144
Residential mortgage obligations:	Fair Value		Gross Unrealized Gains		Gross Unrealized (Losses)			Cost or Amortized Cost
Prime	$	13,457	$	548	$	(117	)	$	13,026
Alt-A		1,738		116		(21	)		1,643
Subprime		390		14		—			376
Non-US RMBS		18,502		475		—			18,027
Total	$	34,087	$	1,153	$	(138	)	$	33,072