EMC Quarterly Net Is Up 18 %

NU Online News Service, Feb. 25, 1:42 p.m. EST?EMC Insurance Group Inc. said its net income for the 2003 fourth quarter rose on a year-over-year basis, up 18 percent to $6.09 million from $5.17 million posted during the 2002 fourth quarter. [@@]

The Des Moines, Iowa-based insurer said higher premium rates and the improved quality of its risks had powered the results, which included a 26 percent rise in full-year 2003 net income to $20.35 million, compared to $16.10 million reported in 2002.

Bruce Kelley, president and chief executive officer at EMC, said despite an unusually high level of catastrophe and storm losses and some necessary reserve strengthening, EMC managed to post its "most profitable year since its debut as a public company in 1982."

"Over the last several years we have been diligent in our efforts to improve both premium rate adequacy and the quality of the risks we insure," Mr. Kelley commented. "Those efforts have been successful, and we are now experiencing the financial benefits of those initiatives."

For full-year 2003 EMC has posted $249.59 million in written premiums for its property-casualty units, up from $237.63 million reported one year ago.

Written premiums for the reinsurance operations also rose, to $90.06 million from $76.20 million for 2002. The company noted that for 2003, premiums earned increased 11.3 percent to $330.62 million compared to $297.04 million for 2002.

Company management said the gains are primarily attributed to rate hikes implemented during the last two years in the p-c insurance business as well as significant growth and improved pricing in the assumed reinsurance business.

"The market for p-c insurance remained firm during the fourth quarter of 2003 and no significant changes are forecast for 2004," according to EMC. The company said it will continue to implement rate increases in those lines of business as well as territories "where such action is warranted." However, the overall level of these rate hikes is expected to be smaller than those made during 2003, it added.

EMC?through its EMCASCO Insurance, Illinois EMCASCO and Dakota Fire Insurance?offers a number of p-c lines, including auto, property, liability and workers' compensation. The company also sells high-risk private auto insurance through its Farm and City Insurance, while its EMC Underwriters offers excess and surplus lines of insurance. Additionally, the company sells p-c treaty reinsurance through EMC Reinsurance.

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EMC Quarterly Net Is Up 18 %

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