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Segment Information
 9 Months Ended
Sep. 30, 2014
Segment Reporting [Abstract]  
Segment Information
Segment Information
The Company has four reportable segments: personal insurance, business insurance, specialty insurance and investment operations. The reportable insurance segments are business units managed separately because of the differences in the type of customers they serve, the products they provide or services they offer. The insurance segments market a broad line of property and casualty insurance products throughout the United States through independent insurance agencies, which include retail agents and wholesale brokers. The personal insurance segment provides primarily personal automobile and homeowners to the personal insurance market. The business insurance segment provides primarily commercial automobile, commercial multi-peril, fire & allied and general liability insurance covering small-to-medium sized commercial exposures. The specialty insurance segment provides commercial coverages, including workers’ compensation for both the legacy State Auto Group and RTW's insurance subsidiaries, that require specialized product underwriting, claims handling or risk management services through a distribution channel of retail agents and wholesale brokers, which may include program administrators and other specialty sources. The investment operations segment, managed by Stateco, provides investment services.
The Company evaluates the performance of its insurance segments using industry financial measurements based on Statutory Accounting Practices (“SAP”), which include loss and loss adjustment expense ratios, underwriting expense ratios, combined ratios, statutory underwriting gain (loss), net premiums earned and net written premiums. One of the most significant differences between SAP and GAAP is that SAP requires all underwriting expenses to be expensed immediately and not deferred and amortized over the same period the premium is earned.
The accounting for pension benefits also contributes to the difference between our GAAP loss and expense ratios and our SAP loss and expense ratios.
The investment operations segment is evaluated based on investment returns of assets managed by Stateco. Asset information by segment is not reported for the insurance segments because the Company does not produce such information internally.

The following table sets forth financial information regarding the Company’s reportable segments for the three and nine months ended September 30, 2014 and 2013:
($ millions)
Three months ended September 30
 
Nine months ended September 30
 
2014
 
2013
 
2014
 
2013
Revenue from external sources:
 
 
 
 
 
 
 
Insurance segments
 
 
 
 
 
 
 
Personal insurance
$
112.3

 
$
116.4

 
$
340.3

 
$
348.3

Business insurance
96.0

 
92.9

 
285.4

 
271.0

Specialty insurance
61.9

 
56.7

 
175.3

 
171.5

Total insurance segments
270.2

 
266.0

 
801.0

 
790.8

Investment operations segment
 
 
 
 
 
 
 
Net investment income
18.9

 
18.8

 
57.0

 
55.4

Net realized capital gains
1.6

 
7.5

 
17.6

 
15.7

Total investment operations segment
20.5

 
26.3

 
74.6

 
71.1

All other
0.6

 
0.4

 
1.4

 
1.4

Total revenue from external sources
291.3

 
292.7

 
877.0

 
863.3

Intersegment revenue
1.3

 
1.4

 
3.9

 
4.0

Total revenue
292.6

 
294.1

 
880.9

 
867.3

Reconciling items:
 
 
 
 
 
 
 
Eliminate intersegment revenues
(1.3
)
 
(1.4
)
 
(3.9
)
 
(4.0
)
Total consolidated revenues
$
291.3

 
$
292.7

 
$
877.0

 
$
863.3

Segment income before federal income tax:
 
 
 
 
 
 
 
Insurance segments SAP underwriting income (loss)
 
 
 
 
 
 
 
Personal insurance
$
4.5

 
$
(6.0
)
 
$
(0.1
)
 
$
(11.5
)
Business insurance
(3.3
)
 
(1.1
)
 
(18.6
)
 
(11.0
)
Specialty insurance
(11.4
)
 
3.1

 
(24.1
)
 
(4.6
)
Total insurance segments
(10.2
)
 
(4.0
)
 
(42.8
)
 
(27.1
)
Investment operations segment
 
 
 
 
 
 
 
Net investment income
18.9

 
18.8

 
57.0

 
55.4

Net realized capital gains
1.6

 
7.5

 
17.6

 
15.7

Total investment operations segment
20.5

 
26.3

 
74.6

 
71.1

All other
—

 
—

 
—

 
0.8

Total segment income before tax expense
10.3

 
22.3

 
31.8

 
44.8

Reconciling items:
 
 
 
 
 
 
 
GAAP expense adjustments
4.2

 
(0.4
)
 
18.4

 
11.4

Interest expense on corporate debt
(1.4
)
 
(1.6
)
 
(4.0
)
 
(7.1
)
Corporate expenses
—

 
(1.6
)
 
(2.3
)
 
(4.1
)
Total reconciling items
2.8

 
(3.6
)
 
12.1

 
0.2

Total consolidated income before federal income tax expense
$
13.1

 
$
18.7

 
$
43.9

 
$
45.0

 
 
 
 
 
 
 
 

Investable assets attributable to the Company’s investment operations segment totaled $2,405.0 million and $2,331.6 million at September 30, 2014 and December 31, 2013, respectively.