American Household Insurance noticed its net revenue rise 5.1 % in 2013, regardless of having to pay out much more for automobile wrecks and weathering a rare November tornado in central Illinois that developed 6 times the anticipated damage claims for that month.
The Madison-based mostly insurer of autos, properties, well being, farms and companies in 19 primarily Midwestern states also added $ 444.1 million to its policyholder equity, continuing steady recovery in that crucial fund, which noticed a sharp drop during the 2008 fiscal crisis. Described as an extra layer of safety for policyholders, the equity fund has grown by a lot more than $ 2 billion given that then to reach a record $ 6.58 billion in 2013, in accordance to an annual report released by the firm Tuesday.
American Family chairman and CEO Jack Salzwedel in a statement cited that developing economic strength for permitting the firm to make new investments while even now safeguarding and serving consumers. The company has acquired 3 outdoors insurers because December 2012 that — while getting considerably smaller sized than American Family members — let consumers acquire goods right, on the Web or by telephone, rather than by way of American Family’;s 3,500 independent contractor agents.
Net earnings in 2013 was $ 378.8 million, up 5.1 percent from $ 360.5 million in 2012, which noticed a 22 % improve. A big reduction in 2011, by contrast, was brought on by a record $ one.2 billion in claims from Midwestern wind and hail storms that had been hefty all through that 12 months.
Catastrophe losses in 2013 had been $ 804.8 million, in contrast with $ 840.6 million in property/casualty claims in 2012. Practically a third of the damage claims came in August, when serious hail storms hit Colorado, the Dakotas, Minnesota and Wisconsin. June was one more undesirable month, with wildfires in Colorado making about $ 40 million in claim payments.
The final blow was in November, when a tornado leveled elements of central Illinois and triggered claim payments of $ 54.5 million, 6 times what the organization budgeted for that typically quiet month.
Storm damage claims and greater-than-anticipated liability declare payments on auto insurance contributed to an underwriting loss of $ 97.4 million in 2013 for American Family. But that was lower than the $ 177.2 million underwriting reduction it posted in 2012, due in component to greater-than-expected results in the company’;s house and business-ranch insurance lines.
Strong investment returns, working outcomes and after-tax capital gains also contributed to the company’;s total net cash flow achieve, in accordance to the annual report, whilst premium income hit $ 6.3 billion.
Company assets final yr totaled $ 19.5 billion, up 8.6 percent from $ 17.9 billion. Existence insurance in force rose to $ 89.6 billion, from $ 88.3 billion in 2012.
American Family finished 2013 with a mixed ratio of 101.7 for its core business of house and casualty insurance coverage. That means it paid almost $ 1.02 in claims and expenses in 2013 for every single dollar of earned premium. In 2012, it paid out $ 1.03.
The organization has about 7,500 workers and is the nation’;s third-greatest mutual property/casualty insurance firm, ranking 393 on the Fortune 500.
Final yr, American Loved ones posted its third acquisition with the obtain on Dec. 31 of direct residence insurer Homesite Group, Inc., based mostly in Boston and using 700 men and women. Its operating results will be incorporated in American Family’;s yearly report starting up in 2014.
This year’;s report did for the first time contain operating outcomes from the company’;s very first 2 acquisitions — Permanent Basic Holdings Corp., acknowledged as The Common, and AssureStart, a direct small enterprise insurance coverage distributor formed final November.
The General is a direct non-standard auto insurance organization primarily based in Nashville. It was purchased by American Household in December 2012 and employs 800 men and women. It operates in 29 states, selling policies above the World wide web and by means of contact centers.
Seattle-based mostly AssureStart is a begin-up firm with 25 employees in 4 states. It sells industrial insurance coverage policies via the Net and phone centers, with a target on lower-threat, little organizations.