NU Online News Service, Nov. 9, 12:15 p.m. EST
EMC Insurance Group Inc. says a record $26.4 million in third-quarter catastrophe losses, combined with a drop in investment income, caused the insurer to report a net loss of $4.1 million for the quarter.
Last year during the same period the Des Moines, Iowa-based business and personal insurer posted a $7.5 million gain.
Though third-quarter premiums earned jumped 10.4 percent to $107.4 million compared to last year, the catastrophe losses and a 7.4 percent drop in investment income erased gains despite $8.6 million of favorable development on prior-year reserves during the third quarter.
For the year EMC said it has a net loss of $11.4 million as catastrophe losses after nine months equal $76.8 million.
Catastrophe losses accounted for more 24.5 points to the company’s third-quarter combined ratio of 114.5 and 25.2 points to the nine-month combined ratio of 120.3.
Catastrophe losses over the last decade have contributed an average 11.3 points to the combined ratio, said EMC, which added its previous prediction of a 115.2 combined ratio for the year remains unchanged.
Meanwhile, Florida domestic insurer Homeowners Choice Inc. said net income available to stockholders was about $1.9 compared to $1.7 million a year ago during the third quarter.
Net premiums earned increased 18 percent to $17.8 million during the third quarter.
Homeowners Choice recently announced that subsidiary Homeowners Choice Property & Insurance Co. is buying Florida domestic, HomeWise Insurance Co.