XML 30 R19.htm IDEA: XBRL DOCUMENT v3.10.0.1
Segment Information
 9 Months Ended
Sep. 30, 2018
Segment Reporting [Abstract]  
Segment Information Segment Information
The Company has four reportable segments: personal insurance, commercial 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 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 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, 2018 and 2017:
($ millions)
Three months ended September 30
 
Nine months ended September 30
 
2018
 
2017
 
2018
 
2017
Revenue from external sources:
 
 
 
 
 
 
 
Insurance segments
 
 
 
 
 
 
 
Personal insurance
$
173.0

 
$
144.1

 
$
494.2

 
$
430.6

Commercial insurance
115.2

 
114.3

 
345.7

 
341.8

Specialty insurance
18.6

 
60.6

 
89.3

 
184.8

Total insurance segments
306.8

 
319.0

 
929.2

 
957.2

Investment operations segment
 
 
 
 
 
 
 
Net investment income
20.8

 
18.7

 
62.2

 
56.5

Net investment gain
17.8

 
20.2

 
18.2

 
43.8

Total investment operations segment
38.6

 
38.9

 
80.4

 
100.3

All other
0.6

 
0.5

 
1.8

 
1.7

Total revenue from external sources
346.0

 
358.4

 
1,011.4

 
1,059.2

Intersegment revenue
1.6

 
1.6

 
4.8

 
3.0

Total revenue
347.6

 
360.0

 
1,016.2

 
1,062.2

Reconciling items:
 
 
 
 
 
 
 
Eliminate intersegment revenue
(1.6
)
 
(1.6
)
 
(4.8
)
 
(3.0
)
Total consolidated revenues
$
346.0

 
$
358.4

 
$
1,011.4

 
$
1,059.2

Segment income before federal income tax:
 
 
 
 
 
 
 
Insurance segments SAP underwriting gain (loss)
 
 
 
 
 
 
 
Personal insurance
$
6.9

 
$
(7.4
)
 
$
(4.6
)
 
$
(31.4
)
Commercial insurance
(5.2
)
 
1.3

 
(22.3
)
 
(7.0
)
Specialty insurance
1.9

 
(39.1
)
 
4.5

 
(52.1
)
Total insurance segments gain (loss)
3.6

 
(45.2
)
 
(22.4
)
 
(90.5
)
Investment operations segment
 
 
 
 
 
 
 
Net investment income
20.8

 
18.7

 
62.2

 
56.5

Net investment gain
17.8

 
20.2

 
18.2

 
43.8

Total investment operations segment
38.6

 
38.9

 
80.4

 
100.3

All other
0.1

 
0.1

 
0.3

 
0.2

Total segment income (loss) before reconciling items
42.3

 
(6.2
)
 
58.3

 
10.0

Reconciling items:
 
 
 
 
 
 
 
GAAP expense adjustments
0.8

 
(2.8
)
 
(2.6
)
 
(6.3
)
Interest expense on corporate debt
(1.2
)
 
(1.5
)
 
(4.5
)
 
(4.4
)
Corporate expenses
(0.9
)
 
(0.7
)
 
(5.8
)
 
(2.6
)
Total reconciling items
(1.3
)
 
(5.0
)
 
(12.9
)
 
(13.3
)
Total consolidated income (loss) before federal income tax expense
$
41.0

 
$
(11.2
)
 
$
45.4

 
$
(3.3
)
 
 
 
 
 
 
 
 

Investable assets attributable to the Company’s investment operations segment totaled $2,697.5 million and $2,781.2 million at September 30, 2018, and December 31, 2017, respectively.