þ
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
(State or other jurisdiction of
incorporation or organization)
|
36-2476480
(I.R.S. Employer
Identification Number)
|
Large accelerated filer
o
|
Accelerated filer
o
|
Non-accelerated filer
o
(Do not check if a smaller reporting company)
|
Smaller reporting company
þ
|
Page | ||||
PART I — FINANCIAL INFORMATION
|
||||
Item 1 —
|
Financial Statements
|
2 | ||
Condensed Consolidated Balance Sheets at March 31, 2014 (Unaudited) and December 31, 2013 | 2 | |||
Condensed Consolidated Statements of Income and Comprehensive Income for the three months ended March 31, 2014 (Unaudited) and 2013 (Unaudited) | 3 | |||
Condensed Consolidated Statement of Stockholders’ Equity for the three months ended March 31, 2014 (Unaudited) | 4 | |||
Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2014 (Unaudited) and 2013 (Unaudited) | 5 | |||
Notes to Condensed Consolidated Financial Statements (Unaudited) | 6 | |||
Item 2 —
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations | 29 | ||
Item 3 —
|
Quantitative and Qualitative Disclosures About Market Risk | 49 | ||
Item 4 —
|
Controls and Procedures | 49 | ||
PART II — OTHER INFORMATION
|
||||
Item 1 —
|
Legal Proceedings
|
50 | ||
Item 1A —
|
Risk Factors
|
50 | ||
Item 2 —
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
50 | ||
Item 3 —
|
Defaults Upon Senior Securities
|
50 | ||
Item 4 —
|
Mine Safety Disclosures
|
50 | ||
Item 5 —
|
Other Information
|
50 | ||
Item 6 —
|
Exhibits
|
50 | ||
Signatures
|
||||
EXHIBIT 3(a)
|
||||
EXHIBIT 3(b) | ||||
EXHIBIT 31(a) | ||||
EXHIBIT 31(b)
|
||||
EXHIBIT 32 | ||||
EXHIBIT 101.INS XBRL Instance Document | ||||
EXHIBIT 101.SCH XBRL Taxonomy Extension Schema | ||||
EXHIBIT 101.CAL XBRL Taxonomy Extension Calculation Linkbase | ||||
EXHIBIT 101.DEF XBRL Taxonomy Extension Definition Linkbase | ||||
EXHIBIT 101.LAB XBRL Taxonomy Extension Label Linkbase | ||||
EXHIBIT 101.PRE XBRL Taxonomy Extension Presentation Linkbase |
Condensed Consolidated Balance Sheets
|
||||||||
March 31,
|
December 31,
|
|||||||
2014
|
2013
|
|||||||
(unaudited)
|
||||||||
Asset
s
|
||||||||
Fixed-maturity securities, held-to-maturity, at amortized cost (fair value of
|
||||||||
$4,102,096 at March 31, 2014 and $2,425,261 at December 31, 2013)
|
$ | 3,969,335 | $ | 2,399,482 | ||||
Fixed-maturity securities, available-for-sale, at fair value (amortized cost of
|
||||||||
$36,267,872 at March 31, 2014 and $28,079,902 at December 31, 2013)
|
37,087,852 | 28,436,022 | ||||||
Equity securities, available-for-sale, at fair value (cost of $8,190,655
|
||||||||
at March 31, 2014 and $6,690,338 at December 31, 2013)
|
8,513,526 | 6,796,673 | ||||||
Total investments
|
49,570,713 | 37,632,177 | ||||||
Cash and cash equivalents
|
8,563,066 | 19,922,506 | ||||||
Premiums receivable, net of provision for uncollectible amounts
|
8,102,612 | 7,590,074 | ||||||
Receivables - reinsurance contracts
|
858,567 | 974,989 | ||||||
Reinsurance receivables, net of provision for uncollectible amounts
|
43,531,328 | 37,560,825 | ||||||
Deferred policy acquisition costs
|
7,193,301 | 6,860,263 | ||||||
Intangible assets, net
|
2,590,315 | 2,709,244 | ||||||
Property and equipment, net of accumulated depreciation
|
2,295,861 | 2,038,755 | ||||||
Other assets
|
1,447,522 | 1,494,989 | ||||||
Total asset
s
|
$ | 124,153,285 | $ | 116,783,822 | ||||
Liabilitie
s
|
||||||||
Loss and loss adjustment expense reserves
|
$ | 40,043,254 | $ | 34,503,229 | ||||
Unearned premiums
|
33,466,488 | 32,335,614 | ||||||
Advance premiums
|
1,165,871 | 776,099 | ||||||
Reinsurance balances payable
|
2,982,222 | 2,566,729 | ||||||
Deferred ceding commission revenue
|
7,117,642 | 6,984,166 | ||||||
Accounts payable, accrued expenses and other liabilities
|
2,301,195 | 3,215,487 | ||||||
Deferred income taxes
|
868,281 | 693,087 | ||||||
Total liabilitie
s
|
87,944,953 | 81,074,411 | ||||||
Commitments and Contingencies
|
||||||||
Stockholders' Equity
|
||||||||
Preferred stock, $.01 par value; authorized 2,500,000 shares
|
- | - | ||||||
Common stock, $.01 par value; authorized 20,000,000 shares; issued 8,186,031 shares;
|
||||||||
outstanding 7,266,573 shares
|
81,860 | 81,860 | ||||||
Capital in excess of par
|
32,705,959 | 32,692,568 | ||||||
Accumulated other comprehensive income
|
754,280 | 305,219 | ||||||
Retained earnings
|
4,223,678 | 4,187,209 | ||||||
37,765,777 | 37,266,856 | |||||||
Treasury stock, at cost, 919,458 shares
|
(1,557,445 | ) | (1,557,445 | ) | ||||
Total stockholders' equity
|
36,208,332 | 35,709,411 | ||||||
Total liabilities and stockholders' equity
|
$ | 124,153,285 | $ | 116,783,822 |
KINGSTONE COMPANIES, INC. AND SUBSIDIARIES
|
||||||||
Condensed Consolidated Statements of Income and Comprehensive Income (Unaudited)
|
||||||||
Three months ended March 31,
|
2014
|
2013
|
||||||
Revenue
s
|
||||||||
Net premiums earned
|
$ | 5,926,311 | $ | 4,623,215 | ||||
Ceding commission revenue
|
3,381,283 | 2,293,711 | ||||||
Net investment income
|
378,788 | 283,287 | ||||||
Net realized gains on sales of investments
|
188,348 | 105,125 | ||||||
Other income
|
227,557 | 213,990 | ||||||
Total revenues
|
10,102,287 | 7,519,328 | ||||||
Expense
s
|
||||||||
Loss and loss adjustment expenses
|
4,324,954 | 2,469,641 | ||||||
Commission expense
|
2,582,508 | 2,115,820 | ||||||
Other underwriting expenses
|
2,281,749 | 2,213,345 | ||||||
Other operating expenses
|
250,035 | 243,310 | ||||||
Depreciation and amortization
|
183,120 | 152,986 | ||||||
Interest expense
|
- | 21,215 | ||||||
Total expenses
|
9,622,366 | 7,216,317 | ||||||
Income from operations before taxes
|
479,921 | 303,011 | ||||||
Income tax expense
|
152,788 | 112,003 | ||||||
Net income
|
327,133 | 191,008 | ||||||
Other comprehensive income, net of tax
|
||||||||
Gross change in unrealized gains on available-for-sale-securities
|
680,396 | 445,743 | ||||||
Income tax expense related to items of other comprehensive income
|
(231,335 | ) | (151,553 | ) | ||||
Comprehensive income
|
$ | 776,194 | $ | 485,198 | ||||
Earnings per common share:
|
||||||||
Basic
|
$ | 0.05 | $ | 0.05 | ||||
Diluted
|
$ | 0.04 | $ | 0.05 | ||||
Weighted average common shares outstanding
|
||||||||
Basic
|
7,266,573 | 3,840,899 | ||||||
Diluted
|
7,372,149 | 3,914,406 | ||||||
Dividends declared and paid per common share
|
$ | 0.04 | $ | 0.04 |
Accumulated
|
||||||||||||||||||||||||||||||||||||||||
Capital
|
Other
|
|
||||||||||||||||||||||||||||||||||||||
Preferred Stock
|
Common Stock
|
in Excess
|
Comprehensive |
Retained
|
Treasury Stock
|
|||||||||||||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
of Par
|
Income
|
Earnings
|
Shares
|
Amount
|
Total
|
|||||||||||||||||||||||||||||||
Balance, January 1, 2014
|
- | $ | - | 8,186,031 | $ | 81,860 | $ | 32,692,568 | $ | 305,219 | $ | 4,187,209 | 919,458 | $ | (1,557,445 | ) | $ | 35,709,411 | ||||||||||||||||||||||
Stock-based compensation
|
- | - | - | - | 13,391 | - | - | - | - | 13,391 | ||||||||||||||||||||||||||||||
Dividends
|
- | - | - | - | - | - | (290,664 | ) | - | - | (290,664 | ) | ||||||||||||||||||||||||||||
Net income
|
- | - | - | - | - | - | 327,133 | - | - | 327,133 | ||||||||||||||||||||||||||||||
Change in unrealized gains on available-
|
||||||||||||||||||||||||||||||||||||||||
for-sale securities, net of tax
|
- | - | - | - | - | 449,061 | - | - | - | 449,061 | ||||||||||||||||||||||||||||||
Balance, March 31, 2014
|
- | $ | - | 8,186,031 | $ | 81,860 | $ | 32,705,959 | $ | 754,280 | $ | 4,223,678 | 919,458 | $ | (1,557,445 | ) | $ | 36,208,332 |
Three months ended March 31,
|
2014
|
2013
|
||||||
Cash flows provided by operating activities
:
|
||||||||
Net income
|
$ | 327,133 | $ | 191,008 | ||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||
Net realized gains on sales of investments
|
(188,348 | ) | (105,125 | ) | ||||
Depreciation and amortization
|
183,120 | 152,986 | ||||||
Amortization of bond premium, net
|
82,997 | 45,074 | ||||||
Stock-based compensation
|
13,391 | 8,748 | ||||||
Deferred income tax expense
|
(56,141 | ) | (124,532 | ) | ||||
(Increase) decrease in operating assets:
|
||||||||
Premiums receivable, net
|
(512,538 | ) | 370,668 | |||||
Receivables - reinsurance contracts
|
116,422 | - | ||||||
Reinsurance receivables, net
|
(5,970,503 | ) | 5,281,411 | |||||
Deferred policy acquisition costs
|
(333,038 | ) | 17,101 | |||||
Other assets
|
46,785 | 1,011,071 | ||||||
(Decrease) increase in operating liabilities:
|
||||||||
Loss and loss adjustment expense reserves
|
5,540,025 | (2,175,646 | ) | |||||
Unearned premiums
|
1,130,874 | 551,525 | ||||||
Advance premiums
|
389,772 | 156,610 | ||||||
Reinsurance balances payable
|
415,493 | 4,421,673 | ||||||
Advance payments from catastrophe reinsurers
|
- | (7,358,391 | ) | |||||
Deferred ceding commission revenue
|
133,476 | 45,226 | ||||||
Accounts payable, accrued expenses and other liabilities
|
(914,292 | ) | (244,362 | ) | ||||
Net cash flows provided by operating activities
|
404,628 | 2,245,045 | ||||||
Cash flows used in investing activities
:
|
||||||||
Purchase - fixed-maturity securities held-to-maturity
|
(1,566,354 | ) | - | |||||
Purchase - fixed-maturity securities available-for-sale
|
(10,396,843 | ) | (1,146,075 | ) | ||||
Purchase - equity securities
|
(2,662,152 | ) | (2,298,727 | ) | ||||
Sale or maturity - fixed-maturity securities available-for-sale
|
2,176,834 | 1,522,781 | ||||||
Sale - equity securities
|
1,287,326 | 945,053 | ||||||
Other investing activities
|
(312,215 | ) | (75,898 | ) | ||||
Net cash flows used in investing activitie
s
|
(11,473,404 | ) | (1,052,866 | ) | ||||
Cash flows used in financing activities
:
|
||||||||
Proceeds from line of credit
|
- | 100,000 | ||||||
Principal payments on line of credit
|
- | (550,000 | ) | |||||
Dividends paid
|
(290,664 | ) | (153,637 | ) | ||||
Net cash flows used in financing activitie
s
|
(290,664 | ) | (603,637 | ) | ||||
(Decrease) increase in cash and cash equivalents
|
$ | (11,359,440 | ) | $ | 588,542 | |||
Cash and cash equivalents, beginning of period
|
19,922,506 | 2,240,012 | ||||||
Cash and cash equivalents, end of period
|
$ | 8,563,066 | $ | 2,828,554 | ||||
Supplemental disclosures of cash flow information:
|
||||||||
Cash paid for income taxes
|
$ | 400 | $ | - | ||||
Cash paid for interest
|
$ | - | $ | 39,087 |
March 31, 2014
|
December 31, 2013
|
|||||||||||||||
Amortized
|
Amortized
|
|||||||||||||||
Remaining Time to Maturit
y
|
Cost
|
Fair Value
|
Cost
|
Fair Value
|
||||||||||||
Less than one year
|
$ | 745,401 | $ | 760,948 | $ | 758,281 | $ | 768,954 | ||||||||
One to five years
|
8,424,752 | 8,843,711 | 9,025,386 | 9,466,973 | ||||||||||||
Five to ten years
|
20,629,510 | 20,997,899 | 14,070,003 | 14,114,271 | ||||||||||||
More than 10 years
|
6,468,209 | 6,485,294 | 4,226,232 | 4,085,824 | ||||||||||||
Total
|
$ | 36,267,872 | $ | 37,087,852 | $ | 28,079,902 | $ | 28,436,022 |
March 31, 2014
|
December 31, 2013
|
|||||||||||||||
Amortized
|
Amortized
|
|||||||||||||||
Remaining Time to Maturit
y
|
Cost
|
Fair Value
|
Cost
|
Fair Value
|
||||||||||||
Less than one year
|
$ | - | $ | - | $ | - | $ | - | ||||||||
One to five years
|
- | - | - | - | ||||||||||||
Five to ten years
|
2,162,433 | 2,206,448 | 1,793,344 | 1,772,208 | ||||||||||||
More than 10 years
|
1,806,902 | 1,895,648 | 606,138 | 653,053 | ||||||||||||
Total
|
$ | 3,969,335 | $ | 4,102,096 | $ | 2,399,482 | $ | 2,425,261 |
Three months ended
|
||||||||
March 31,
|
||||||||
2014
|
2013
|
|||||||
Income:
|
||||||||
Fixed-maturity securities
|
$ | 342,918 | $ | 260,035 | ||||
Equity securities
|
114,513 | 86,455 | ||||||
Cash and cash equivalents
|
20,619 | 29 | ||||||
Total
|
478,050 | 346,519 | ||||||
Expenses:
|
||||||||
Investment expenses
|
99,262 | 63,232 | ||||||
Net investment income
|
$ | 378,788 | $ | 283,287 |
March 31, 2014
|
||||||||||||||||||||||||||||||||
Less than 12 months
|
12 months or more
|
Total
|
||||||||||||||||||||||||||||||
|
No. of
|
No. of
|
Aggregate
|
|||||||||||||||||||||||||||||
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
|||||||||||||||||||||||||
Categor
y
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
||||||||||||||||||||||||
Fixed-Maturity Securities:
|
||||||||||||||||||||||||||||||||
Political subdivisions of
|
||||||||||||||||||||||||||||||||
States, Territories and
|
||||||||||||||||||||||||||||||||
Possessions
|
$ | 2,669,178 | $ | (25,457 | ) | 9 | $ | 772,206 | $ | (35,326 | ) | 2 | $ | 3,441,384 | $ | (60,783 | ) | |||||||||||||||
Corporate and other
|
||||||||||||||||||||||||||||||||
bonds industrial and
|
||||||||||||||||||||||||||||||||
miscellaneous
|
4,378,126 | (62,730 | ) | 13 | 1,036,070 | (37,845 | ) | 4 | 5,414,196 | (100,575 | ) | |||||||||||||||||||||
Total fixed-maturity
|
||||||||||||||||||||||||||||||||
securities
|
$ | 7,047,304 | $ | (88,187 | ) | 22 | $ | 1,808,276 | $ | (73,171 | ) | 6 | $ | 8,855,580 | $ | (161,358 | ) | |||||||||||||||
Equity Securities:
|
||||||||||||||||||||||||||||||||
Preferred stocks
|
$ | 1,443,956 | $ | (68,114 | ) | 6 | $ | 646,300 | $ | (58,228 | ) | 3 | $ | 2,090,256 | $ | (126,342 | ) | |||||||||||||||
Common stocks
|
418,425 | (20,945 | ) | 2 | - | - | - | 418,425 | (20,945 | ) | ||||||||||||||||||||||
Total equity securities
|
$ | 1,862,381 | $ | (89,059 | ) | 8 | $ | 646,300 | $ | (58,228 | ) | 3 | $ | 2,508,681 | $ | (147,287 | ) | |||||||||||||||
Total
|
$ | 8,909,685 | $ | (177,246 | ) | 30 | $ | 2,454,576 | $ | (131,399 | ) | 9 | $ | 11,364,261 | $ | (308,645 | ) |
December 31, 2013
|
||||||||||||||||||||||||||||||||
Less than 12 months
|
12 months or more
|
Total
|
||||||||||||||||||||||||||||||
|
No. of
|
No. of
|
Aggregate
|
|||||||||||||||||||||||||||||
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
|||||||||||||||||||||||||
Categor
y
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
||||||||||||||||||||||||
Fixed-Maturity Securities:
|
||||||||||||||||||||||||||||||||
Political subdivisions of
|
||||||||||||||||||||||||||||||||
States, Territories and
|
||||||||||||||||||||||||||||||||
Possessions
|
$ | 2,015,437 | $ | (49,491 | ) | 6 | $ | 415,866 | $ | (45,140 | ) | 2 | $ | 2,431,303 | $ | (94,631 | ) | |||||||||||||||
Corporate and other
|
||||||||||||||||||||||||||||||||
bonds industrial and
|
||||||||||||||||||||||||||||||||
miscellaneous
|
6,447,605 | (179,810 | ) | 24 | 1,430,377 | (101,194 | ) | 5 | 7,877,982 | (281,004 | ) | |||||||||||||||||||||
Total fixed-maturity
|
||||||||||||||||||||||||||||||||
securities
|
$ | 8,463,042 | $ | (229,301 | ) | 30 | $ | 1,846,243 | $ | (146,334 | ) | 7 | $ | 10,309,285 | $ | (375,635 | ) | |||||||||||||||
Equity Securities:
|
||||||||||||||||||||||||||||||||
Preferred stocks
|
$ | 1,835,958 | $ | (251,525 | ) | 8 | $ | 444,100 | $ | (62,551 | ) | 2 | $ | 2,280,058 | $ | (314,076 | ) | |||||||||||||||
Common stocks
|
879,525 | (38,785 | ) | 4 | 145,625 | (13,913 | ) | 1 | 1,025,150 | (52,698 | ) | |||||||||||||||||||||
Total equity securities
|
$ | 2,715,483 | $ | (290,310 | ) | 12 | $ | 589,725 | $ | (76,464 | ) | 3 | $ | 3,305,208 | $ | (366,774 | ) | |||||||||||||||
Total
|
$ | 11,178,525 | $ | (519,611 | ) | 42 | $ | 2,435,968 | $ | (222,798 | ) | 10 | $ | 13,614,493 | $ | (742,409 | ) |
March 31, 2014
|
||||||||||||||||
($ in thousands
)
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||||||||
Fixed-maturity securities
|
||||||||||||||||
U.S. Treasury securities
|
||||||||||||||||
and obligations of U.S.
|
||||||||||||||||
government corporations
|
||||||||||||||||
and agencies
|
$ | - | $ | - | $ | - | $ | - | ||||||||
Political subdivisions of
|
||||||||||||||||
States, Territories and
|
||||||||||||||||
Possessions
|
- | 11,396 | - | 11,396 | ||||||||||||
Corporate and other
|
||||||||||||||||
bonds industrial and
|
||||||||||||||||
miscellaneous
|
17,553 | 8,138 | - | 25,691 | ||||||||||||
Total fixed maturities
|
17,553 | 19,534 | - | 37,087 | ||||||||||||
Equity securities
|
8,514 | - | - | 8,514 | ||||||||||||
Total investments
|
$ | 26,067 | $ | 19,534 | $ | - | $ | 45,601 |
March 31, 2014
|
December 31, 2013
|
|||||||||||||||
Carrying Value
|
Fair Value
|
Carrying Value
|
Fair Value
|
|||||||||||||
Fixed-maturity investments held to maturity
|
$ | 3,969,335 | $ | 4,102,096 | $ | 2,399,482 | $ | 2,425,261 | ||||||||
Cash and cash equivalents
|
8,563,066 | 8,563,066 | 19,922,506 | 19,922,506 | ||||||||||||
Premiums receivable
|
8,102,612 | 8,102,612 | 7,590,074 | 7,590,074 | ||||||||||||
Receivables - reinsurance contracts
|
858,567 | 858,567 | 974,989 | 974,989 | ||||||||||||
Reinsurance receivables
|
43,531,328 | 43,531,328 | 37,560,825 | 37,560,825 | ||||||||||||
Real estate, net of accumulated depreciation
|
1,766,149 | 1,816,122 | 1,777,942 | 1,816,122 | ||||||||||||
Reinsurance balances payable
|
2,982,222 | 2,982,222 | 2,566,729 | 2,566,729 |
Three months ended
March 31,
|
||||||||
2014
|
2013
|
|||||||
Balance at beginning of period
|
$ | 34,503,229 | $ | 30,485,532 | ||||
Less reinsurance recoverables
|
(17,363,975 | ) | (18,419,694 | ) | ||||
Net balance, beginning of period
|
17,139,254 | 12,065,838 | ||||||
Incurred related to:
|
||||||||
Current year
|
4,121,732 | 2,469,783 | ||||||
Prior years
|
203,222 | (142 | ) | |||||
Total incurred
|
4,324,954 | 2,469,641 | ||||||
Paid related to:
|
||||||||
Current year
|
1,082,950 | 588,655 | ||||||
Prior years
|
1,455,086 | 1,365,361 | ||||||
Total paid
|
2,538,036 | 1,954,016 | ||||||
|
||||||||
Net balance at end of period
|
18,926,172 | 12,581,463 | ||||||
Add reinsurance recoverables
|
21,117,082 | 15,728,423 | ||||||
Balance at end of period
|
$ | 40,043,254 | $ | 28,309,886 | ||||
Treaty
|
Extent of Loss
|
Risk Retained
|
||
Personal Lines
|
Initial $1,200,000
|
$300,000
|
||
$1,200,000 - $2,900,000
|
None
(1)
|
|||
Over $2,900,000
|
100%
|
|||
Personal Umbrella
|
Initial $1,000,000
|
$100,000
|
||
$1,000,000 - $2,000,000
|
None
(1)
|
|||
Over $2,000,000
|
100%
|
|||
Commercial Lines
|
Initial $400,000
|
$300,000
|
||
$400,000 - $2,900,000
|
None
(1)
|
|||
Over $2,900,000
|
100%
|
|||
Commercial Auto
|
Initial $300,000
|
$300,000
|
||
$300,000 - $2,000,000
|
None
(1)
|
|||
Over $2,000,000
|
100%
|
|||
Catastrophe
(2)
|
Initial $4,000,000
|
$1,000,000
|
||
$4,000,000 - $90,000,000
|
None
|
|||
Over $90,000,000
|
100%
|
(1)
|
Covered by excess of loss treaties.
|
(2)
|
Catastrophe coverage is limited on an annual basis to two times the per occurrence amounts.
|
Three months ended
|
||||||||
March 31,
|
||||||||
2014
|
2013
|
|||||||
Provisional ceding commissions earned
|
$ | 3,376,876 | $ | 2,392,864 | ||||
Contingent ceding commissions earned
|
4,407 | (99,153 | ) | |||||
$ | 3,381,283 | $ | 2,293,711 |
Stock Options
|
Number of Shares
|
Weighted Average Exercise Price per Share
|
Weighted Average Remaining Contractual Term
|
Aggregate Intrinsic Value
|
||||||||||||
Outstanding at January 1, 2014
|
321,365 | $ | 3.36 | 2.26 | $ | 1,257,936 | ||||||||||
Granted
|
- | $ | - | - | $ | - | ||||||||||
Exercised
|
- | $ | - | - | $ | - | ||||||||||
Forfeited
|
- | $ | - | - | $ | - | ||||||||||
Outstanding at March 31, 2014
|
321,365 | $ | 3.36 | 2.01 | $ | 1,161,527 | ||||||||||
Vested and Exercisable at March 31, 2014
|
244,490 | $ | 2.77 | 1.25 | $ | 1,027,464 |
March 31,
|
December 31,
|
|||||||
2014
|
2013
|
|||||||
Deferred tax asset:
|
||||||||
Net operating loss carryovers (1)
|
$ | 241,684 | $ | 246,476 | ||||
Claims reserve discount
|
491,819 | 445,384 | ||||||
Unearned premium
|
1,071,725 | 1,000,372 | ||||||
Deferred ceding commission revenue
|
2,419,998 | 2,374,616 | ||||||
Other
|
- | 17,087 | ||||||
Total deferred tax assets
|
4,225,226 | 4,083,935 | ||||||
Deferred tax liability:
|
||||||||
Investment in KICO (2)
|
1,169,000 | 1,169,000 | ||||||
Deferred acquisition costs
|
2,445,721 | 2,332,489 | ||||||
Intangibles
|
880,707 | 921,143 | ||||||
Depreciation and amortization
|
181,858 | 197,223 | ||||||
Net unrealized appreciation of securities - available for sale
|
386,930 | 157,167 | ||||||
Other
|
29,291 | - | ||||||
Total deferred tax liabilities
|
5,093,507 | 4,777,022 | ||||||
Net deferred income tax liability
|
$ | (868,281 | ) | $ | (693,087 | ) |
(1)
|
The deferred tax assets from net operating loss carryovers are as follows:
|
March 31,
|
December 31,
|
||||||||
Type of NOL
|
2014
|
2013
|
Expiration
|
||||||
State only (A)
|
$ | 470,734 | $ | 459,989 |
December 31, 2034
|
||||
Valuation allowance
|
(242,650 | ) | (240,713 | ) | |||||
State only, net of valuation allowance
|
228,084 | 219,276 | |||||||
Amount subject to Annual Limitation, federal only (B)
|
13,600 | 27,200 |
December 31, 2019
|
||||||
Total deferred tax asset from net operating loss carryovers
|
$ | 241,684 | $ | 246,476 |
(2)
|
Deferred tax liability - investment in KICO
|
Three months ended
March 31,
|
||||||||
2014
|
2013
|
|||||||
Weighted average number of shares outstanding
|
7,266,573 | 3,840,899 | ||||||
Effect of dilutive securities, common share equivalents
|
105,576 | 73,507 | ||||||
Weighted average number of shares outstanding,
|
||||||||
used for computing diluted earnings per common share
|
7,372,149 | 3,914,406 |
Three months ended March 31,
|
||||||||||||||||
($ in thousands)
|
2014
|
2013
|
Change
|
Percent
|
||||||||||||
Revenue
s
|
||||||||||||||||
Direct written premiums
|
$ | 16,347 | $ | 12,845 | $ | 3,502 | 27.3 | % | ||||||||
Assumed written premiums
|
8 | 10 | (2 | ) | (20.0 | )% | ||||||||||
16,355 | 12,855 | 3,500 | 27.2 | % | ||||||||||||
Ceded written premiums
|
||||||||||||||||
Ceded to quota share treaties
|
9,024 | 7,043 | 1,981 | 28.1 | % | |||||||||||
Ceded to excess of loss treaties
|
200 | 262 | (62 | ) | (23.7 | )% | ||||||||||
Ceded to catastrophe treaties
|
546 | 579 | (33 | ) | (5.7 | )% | ||||||||||
Total ceded written premiums
|
9,770 | 7,884 | 1,886 | 23.9 | % | |||||||||||
Net written premiums
|
6,585 | 4,971 | 1,614 | 32.5 | % | |||||||||||
Change in net unearned premiums
|
(659 | ) | (348 | ) | (311 | ) | 89.4 | % | ||||||||
Net premiums earned
|
5,926 | 4,623 | 1,303 | 28.2 | % | |||||||||||
Ceding commission revenue
|
||||||||||||||||
Excluding the effect of catastrophes
|
3,898 | 3,210 | 688 | 21.4 | % | |||||||||||
Effect of catastrophes (1)
|
(517 | ) | (916 | ) | 399 | (43.6 | )% | |||||||||
Total ceding commission revenue
|
3,381 | 2,294 | 1,087 | 47.4 | % | |||||||||||
Net investment income
|
379 | 283 | 96 | 33.9 | % | |||||||||||
Net realized gain on investments
|
188 | 105 | 83 | 79.0 | % | |||||||||||
Other income
|
228 | 214 | 14 | 6.5 | % | |||||||||||
Total revenues
|
10,102 | 7,519 | 2,583 | 34.4 | % | |||||||||||
Expense
s
|
||||||||||||||||
Loss and loss adjustment expenses
|
||||||||||||||||
Direct and assumed:
|
||||||||||||||||
Loss and loss adjustment expenses excluding the effect of catastrophes
|
7,279 | 7,525 | (246 | ) | (3.3 | )% | ||||||||||
Losses from catastrophes (1)
|
3,764 | - | 3,764 | na | % | |||||||||||
Total direct and assumed loss and loss adjustment expenses
|
11,043 | 7,525 | 3,518 | 46.8 | % | |||||||||||
Ceded loss and loss adjustment expenses:
|
||||||||||||||||
Loss and loss adjustment expenses excluding the effect of catastrophes
|
3,895 | 5,055 | (1,160 | ) | (22.9 | )% | ||||||||||
Losses from catastrophes (1)
|
2,823 | - | 2,823 | na | % | |||||||||||
Total ceded loss and loss adjustment expenses
|
6,718 | 5,055 | 1,663 | 32.9 | % | |||||||||||
Net loss and loss adjustment expenses:
|
||||||||||||||||
Loss and loss adjustment expenses excluding the effect of catastrophes
|
3,384 | 2,470 | 914 | 37.0 | % | |||||||||||
Losses from catastrophes (1)
|
941 | - | 941 | na | % | |||||||||||
Net loss and loss adjustment expenses
|
4,325 | 2,470 | 1,855 | 75.1 | % | |||||||||||
Commission expense
|
2,583 | 2,116 | 467 | 22.1 | % | |||||||||||
Other underwriting expenses
|
2,281 | 2,213 | 68 | 3.1 | % | |||||||||||
Other operating expenses
|
250 | 243 | 7 | 2.9 | % | |||||||||||
Depreciation and amortization
|
183 | 153 | 30 | 19.6 | % | |||||||||||
Interest expense
|
- | 21 | (21 | ) | (100.0 | )% | ||||||||||
Total expenses
|
9,622 | 7,216 | 2,406 | 33.3 | % | |||||||||||
Income from operations before taxes
|
480 | 303 | 177 | 58.4 | % | |||||||||||
Provision for income tax
|
153 | 112 | 41 | 36.6 | % | |||||||||||
Net income
|
$ | 327 | $ | 191 | $ | 136 | 71.2 | % |
Three months ended March 31,
|
||||||||||||||||
2014
|
2013
|
Change
|
Percent
|
|||||||||||||
Key ratios:
|
||||||||||||||||
Net loss ratio
|
73.0 | % | 53.4 | % | 19.6 | % | 36.7 | % | ||||||||
Net underwriting expense ratio
|
22.5 | % | 41.5 | % | (19.0 | )% | (45.8 | )% | ||||||||
Net combined ratio
|
95.5 | % | 94.9 | % | 0.6 | % | 0.6 | % |
For the Three Months Ended
March 31,
|
||||||||
2014
|
2013
|
|||||||
Gross premiums written:
|
||||||||
Personal lines
|
$ | 11,591,297 | $ | 8,726,157 | ||||
Commercial lines
|
2,795,997 | 2,021,324 | ||||||
Commercial auto
|
992,176 | 1,438,867 | ||||||
Livery physical damage and other(1)
|
975,622 | 668,303 | ||||||
Total
|
$ | 16,355,092 | $ | 12,854,651 | ||||
Net premiums written:
|
||||||||
Personal lines
|
$ | 2,724,449 | $ | 1,855,785 | ||||
Commercial lines
|
1,946,824 | 1,087,796 | ||||||
Commercial auto
|
957,400 | 1,380,521 | ||||||
Livery physical damage and other(1)
|
956,590 | 646,884 | ||||||
Total
|
$ | 6,585,263 | $ | 4,970,986 | ||||
Net premiums earned:
|
||||||||
Personal lines
|
$ | 2,572,215 | $ | 1,775,083 | ||||
Commercial lines
|
1,580,823 | 1,071,530 | ||||||
Commercial auto
|
1,106,683 | 1,320,629 | ||||||
Livery physical damage and other(1)
|
666,590 | 455,973 | ||||||
Total
|
$ | 5,926,311 | $ | 4,623,215 | ||||
Net loss and loss adjustment expenses:
|
||||||||
Personal lines
|
$ | 1,849,380 | $ | 521,404 | ||||
Commercial lines
|
973,738 | 251,671 | ||||||
Commercial auto
|
1,032,271 | 892,509 | ||||||
Livery physical damage and other(1)
|
234,496 | 616,923 | ||||||
Unallocated loss adjustment expenses
|
235,069 | 187,134 | ||||||
Total
|
$ | 4,324,954 | $ | 2,469,641 | ||||
Net loss ratio:
|
||||||||
Personal lines
|
71.9 | % | 29.4 | % | ||||
Commercial lines
|
61.6 | % | 23.5 | % | ||||
Commercial auto
|
93.3 | % | 67.6 | % | ||||
Livery physical damage and other(1)
|
35.2 | % | 135.3 | % | ||||
Total
|
73.0 | % | 53.4 | % | ||||
(1)
|
Livery physical damage and other includes, among other things, premiums and loss and loss adjustment expenses from our participation in a mandatory state joint underwriting association.
|
Three Months Ended | ||||||||
March 31,
|
||||||||
2014
|
2013
|
|||||||
Revenue
s
|
||||||||
Net premiums earned
|
$ | 5,926,311 | $ | 4,623,215 | ||||
Ceding commission revenue
|
3,381,283 | 2,293,711 | ||||||
Net investment income
|
378,788 | 283,287 | ||||||
Net realized gain on investments
|
188,348 | 105,125 | ||||||
Other income
|
148,795 | 116,681 | ||||||
Total revenues
|
10,023,525 | 7,422,019 | ||||||
Expense
s
|
||||||||
Loss and loss adjustment expenses
|
4,324,954 | 2,469,641 | ||||||
Commission expense
|
2,582,508 | 2,115,820 | ||||||
Other underwriting expenses
|
2,281,749 | 2,213,345 | ||||||
Depreciation and amortization
|
182,273 | 152,139 | ||||||
Total expenses
|
9,371,484 | 6,950,945 | ||||||
Income from operations
|
652,041 | 471,074 | ||||||
Income tax expense
|
192,788 | 156,003 | ||||||
Net incom
e
|
$ | 459,253 | $ | 315,071 | ||||
Key Measures:
|
||||||||
Net loss ratio
|
73.0 | % | 53.4 | % | ||||
Net underwriting expense ratio
|
22.5 | % | 41.5 | % | ||||
Net combined ratio
|
95.5 | % | 94.9 | % | ||||
Reconciliation of net underwriting expense ratio:
|
||||||||
Acquisition costs and other
|
||||||||
underwriting expenses
|
$ | 4,864,257 | $ | 4,329,165 | ||||
Less: Ceding commission revenue
|
(3,381,283 | ) | (2,293,711 | ) | ||||
Less: Other income
|
(148,795 | ) | (116,681 | ) | ||||
|
$ | 1,334,179 | $ | 1,918,773 | ||||
Net earned premium
|
$ | 5,926,311 | $ | 4,623,215 | ||||
Net Underwriting Expense Ratio
|
22.5 | % | 41.5 | % |
Direct
|
Assumed
|
Ceded
|
Net
|
|||||||||||||
Three months ended March 31, 2014
|
||||||||||||||||
Written premiums
|
$ | 16,347,445 | $ | 7,647 | $ | (9,769,829 | ) | $ | 6,585,263 | |||||||
Unearned premiums
|
(1,133,528 | ) | 2,654 | 471,922 | (658,952 | ) | ||||||||||
Earned premiums
|
$ | 15,213,917 | $ | 10,301 | $ | (9,297,907 | ) | $ | 5,926,311 | |||||||
Loss and loss adjustment expenses exluding
|
||||||||||||||||
the effect of catastrophes
|
$ | 7,266,648 | $ | 12,661 | $ | (3,895,382 | ) | $ | 3,383,927 | |||||||
Catastrophe loss
|
3,764,108 | - | (2,823,081 | ) | 941,027 | |||||||||||
Loss and loss adjustment expenses
|
$ | 11,030,756 | $ | 12,661 | $ | (6,718,463 | ) | $ | 4,324,954 | |||||||
Loss ratio excluding the effect of catastrophes
|
47.8 | % | 122.9 | % | 41.9 | % | 57.1 | % | ||||||||
Catastrophe loss
|
24.7 | % | 0.0 | % | 30.4 | % | 15.9 | % | ||||||||
Loss ratio
|
72.5 | % | 122.9 | % | 72.3 | % | 73.0 | % | ||||||||
Three months ended March 31, 2013
|
||||||||||||||||
Written premiums
|
$ | 12,844,836 | $ | 9,815 | $ | (7,883,665 | ) | $ | 4,970,986 | |||||||
Unearned premiums
|
(578,967 | ) | 27,441 | 203,755 | (347,771 | ) | ||||||||||
Earned premiums
|
$ | 12,265,869 | $ | 37,256 | $ | (7,679,910 | ) | $ | 4,623,215 | |||||||
Loss and loss adjustment expenses exluding
|
||||||||||||||||
the effect of catastrophes
|
$ | 7,506,709 | $ | 18,427 | $ | (5,055,495 | ) | $ | 2,469,641 | |||||||
Catastrophe loss
|
- | - | - | - | ||||||||||||
Loss and loss adjustment expenses
|
$ | 7,506,709 | $ | 18,427 | $ | (5,055,495 | ) | $ | 2,469,641 | |||||||
Loss ratio excluding the effect of catastrophes
|
61.2 | % | 49.5 | % | 65.8 | % | 53.4 | % | ||||||||
Catastrophe loss
|
0.0 | % | 0.0 | % | 0.0 | % | 0.0 | % | ||||||||
Loss ratio
|
61.2 | % | 49.5 | % | 65.8 | % | 53.4 | % |
Three months ended
March 31,
|
||||||||
2014
|
2013
|
|||||||
Net premiums earned
|
$ | 5,926,311 | $ | 4,623,215 | ||||
Ceding commission revenue (1)
|
3,381,283 | 2,293,711 | ||||||
Other income
|
148,795 | 116,681 | ||||||
Loss and loss adjustment expenses (2)
|
4,324,954 | 2,469,641 | ||||||
Acquistion costs and other underwriting expenses:
|
||||||||
Commission expense
|
2,582,508 | 2,115,820 | ||||||
Other underwriting expenses
|
2,281,749 | 2,213,345 | ||||||
Total acquistion costs and other
|
||||||||
underwriting expenses
|
4,864,257 | 4,329,165 | ||||||
Underwriting income
|
$ | 267,178 | $ | 234,801 | ||||
Key Measures:
|
||||||||
Net loss ratio excluding the effect of catastrophes
|
57.1 | % | 53.4 | % | ||||
Effect of catastrophe loss on net loss ratio (2) (3)
|
15.9 | % | 0.0 | % | ||||
Net loss ratio
|
73.0 | % | 53.4 | % | ||||
Net underwriting expense ratio excluding the
|
||||||||
effect of catastrophes
|
13.8 | % | 21.7 | % | ||||
Effect of catastrophe loss on net underwriting
|
||||||||
expense ratio (1) (2)
(3)
|
8.7 | % | 19.8 | % | ||||
Net underwriting expense ratio
|
22.5 | % | 41.5 | % | ||||
Net combined ratio excluding the effect
|
||||||||
of catastrophes
|
70.9 | % | 75.1 | % | ||||
Effect of catastrophe loss on net combined
|
||||||||
ratio (1) (2) (3)
|
24.6 | % | 19.8 | % | ||||
Net combined ratio
|
95.5 | % | 94.9 | % | ||||
Reconciliation of net underwriting expense ratio:
|
||||||||
Acquisition costs and other
|
||||||||
underwriting expenses
|
$ | 4,864,257 | $ | 4,329,165 | ||||
Less: Ceding commission revenue (1)
|
(3,381,283 | ) | (2,293,711 | ) | ||||
Less: Other income
|
(148,795 | ) | (116,681 | ) | ||||
|
$ | 1,334,179 | $ | 1,918,773 |
March 31, 2014
|
||||||||||||||||||||||||
|
Cost or
|
Gross
|
Gross Unrealized Losses
|
Aggregate
|
% of
|
|||||||||||||||||||
Amortized
|
Unrealized
|
Less than 12
|
More than 12
|
Fair
|
Fair
|
|||||||||||||||||||
Categor
y
|
Cos
t
|
Gains
|
Months
|
Months
|
Value
|
Value
|
||||||||||||||||||
Political subdivisions of States,
|
||||||||||||||||||||||||
Territories and Possessions
|
$ | 11,199,284 | $ | 257,295 | $ | (25,457 | ) | $ | (35,326 | ) | $ | 11,395,796 | 25.0 | % | ||||||||||
Corporate and other bonds
|
||||||||||||||||||||||||
Industrial and miscellaneous
|
25,068,588 | 724,043 | (62,730 | ) | (37,845 | ) | 25,692,056 | 56.3 | % | |||||||||||||||
Total fixed-maturity securities
|
36,267,872 | 981,338 | (88,187 | ) | (73,171 | ) | 37,087,852 | 81.3 | % | |||||||||||||||
Equity Securities
|
8,190,655 | 470,158 | (89,059 | ) | (58,228 | ) | 8,513,526 | 18.7 | % | |||||||||||||||
Total
|
$ | 44,458,527 | $ | 1,451,496 | $ | (177,246 | ) | $ | (131,399 | ) | $ | 45,601,378 | 100.0 | % |
March 31, 2014
|
||||||||||||||||||||||||
|
Cost or
|
Gross
|
Gross Unrealized Losses
|
% of
|
||||||||||||||||||||
Amortized
|
Unrealized
|
Less than 12
|
More than 12
|
Fair
|
Fair
|
|||||||||||||||||||
Categor
y
|
Cos
t
|
Gains
|
Months
|
Months
|
Value
|
Value
|
||||||||||||||||||
U.S. Treasury securities
|
$ | 606,327 | $ | 84,612 | $ | - | $ | - | $ | 690,939 | 16.8 | % | ||||||||||||
Political subdivisions of States,
|
||||||||||||||||||||||||
Territories and Possessions
|
1,410,299 | - | (3,437 | ) | - | 1,406,862 | 34.3 | % | ||||||||||||||||
Corporate and other bonds
|
||||||||||||||||||||||||
Industrial and miscellaneous
|
1,952,709 | 51,586 | - | - | 2,004,295 | 48.9 | % | |||||||||||||||||
Total
|
$ | 3,969,335 | $ | 136,198 | $ | (3,437 | ) | $ | - | $ | 4,102,096 | 100.0 | % |
December 31, 2013
|
||||||||||||||||||||||||
|
Cost or
|
Gross
|
Gross Unrealized Losses
|
% of
|
||||||||||||||||||||
Amortized
|
Unrealized
|
Less than 12
|
More than 12
|
Fair
|
Fair
|
|||||||||||||||||||
Categor
y
|
Cos
t
|
Gains
|
Months
|
Months
|
Value
|
Value
|
||||||||||||||||||
U.S. Treasury securities
|
$ | 606,138 | $ | 46,915 | $ | - | $ | - | $ | 653,053 | 26.9 | % | ||||||||||||
Political subdivisions of States,
|
||||||||||||||||||||||||
Territories and Possessions
|
208,697 | - | (25,359 | ) | - | 183,338 | 7.6 | % | ||||||||||||||||
Corporate and other bonds
|
||||||||||||||||||||||||
Industrial and miscellaneous
|
1,584,647 | 4,223 | - | - | 1,588,870 | 65.5 | % | |||||||||||||||||
Total
|
$ | 2,399,482 | $ | 51,138 | $ | (25,359 | ) | $ | - | $ | 2,425,261 | 100.0 | % |
March 31, 2014
|
December 31, 2013
|
|||||||||||||||
Amortized
|
Amortized
|
|||||||||||||||
Remaining Time to Maturit
y
|
Cost
|
Fair Value
|
Cost
|
Fair Value
|
||||||||||||
Less than one year
|
$ | - | $ | - | $ | - | $ | - | ||||||||
One to five years
|
- | - | - | - | ||||||||||||
Five to ten years
|
2,162,433 | 2,206,448 | 1,793,344 | 1,772,208 | ||||||||||||
More than 10 years
|
1,806,902 | 1,895,648 | 606,138 | 653,053 | ||||||||||||
Total
|
$ | 3,969,335 | $ | 4,102,096 | $ | 2,399,482 | $ | 2,425,261 |
March 31, 2014
|
December 31, 2013
|
||||||||||||||||
Percentage of
|
Percentage of
|
||||||||||||||||
Fair Market
|
Fair Market
|
Fair Market
|
Fair Market
|
||||||||||||||
Value
|
Value
|
Value
|
Value
|
||||||||||||||
Rating
|
|||||||||||||||||
U.S. Treasury securities
|
$ | - | 0.0 | % | $ | - | 0.0 | % | |||||||||
AAA
|
2,372,088 | 6.4 | % | 2,075,010 | 7.3 | % | |||||||||||
AA
|
7,402,806 | 20.0 | % | 4,566,384 | 16.1 | % | |||||||||||
A | 10,245,876 | 27.6 | % | 7,680,343 | 27.0 | % | |||||||||||
BBB
|
17,067,082 | 46.0 | % | 14,114,285 | 49.6 | % | |||||||||||
Total
|
$ | 37,087,852 | 100.0 | % | $ | 28,436,022 | 100.0 | % |
Categor
y
|
March 31, 2014
|
December 31, 2013
|
||||||
U.S. Treasury securities and
|
||||||||
obligations of U.S. government
|
||||||||
corporations and agencies
|
3.76 | % | 3.98 | % | ||||
Political subdivisions of States,
|
||||||||
Territories and Possessions
|
4.01 | % | 4.34 | % | ||||
Corporate and other bonds
|
||||||||
Industrial and miscellaneous
|
4.42 | % | 4.69 | % | ||||
Total
|
4.28 | % | 4.59 | % |
March 31, 2014
|
December 31, 2013
|
|||||||
Weighted average effective maturity
|
7.0 | 6.8 | ||||||
Weighted average final maturity
|
7.7 | 7.4 | ||||||
Effective duration
|
6.2 | 5.8 |
March 31, 2014
|
||||||||||||||||||||||||||||||||
Less than 12 months
|
12 months or more
|
Total
|
||||||||||||||||||||||||||||||
|
No. of
|
No. of
|
Aggregate
|
|||||||||||||||||||||||||||||
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
|||||||||||||||||||||||||
Categor
y
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
||||||||||||||||||||||||
Political subdivisions of
|
||||||||||||||||||||||||||||||||
States, Territories and
|
||||||||||||||||||||||||||||||||
Possessions
|
$ | 2,669,178 | $ | (25,457 | ) | 9 | $ | 772,206 | $ | (35,326 | ) | 2 | $ | 3,441,384 | $ | (60,783 | ) | |||||||||||||||
Corporate and other
|
||||||||||||||||||||||||||||||||
bonds industrial and
|
||||||||||||||||||||||||||||||||
miscellaneous
|
4,378,126 | (62,730 | ) | 13 | 1,036,070 | (37,845 | ) | 4 | 5,414,196 | (100,575 | ) | |||||||||||||||||||||
Total fixed-maturity
|
||||||||||||||||||||||||||||||||
securities
|
$ | 7,047,304 | $ | (88,187 | ) | 22 | $ | 1,808,276 | $ | (73,171 | ) | 6 | $ | 8,855,580 | $ | (161,358 | ) | |||||||||||||||
Equity Securities:
|
||||||||||||||||||||||||||||||||
Preferred stocks
|
$ | 1,443,956 | $ | (68,114 | ) | 6 | $ | 646,300 | $ | (58,228 | ) | 3 | $ | 2,090,256 | $ | (126,342 | ) | |||||||||||||||
Common stocks
|
418,425 | (20,945 | ) | 2 | - | - | - | 418,425 | (20,945 | ) | ||||||||||||||||||||||
Total equity securities
|
$ | 1,862,381 | $ | (89,059 | ) | 8 | $ | 646,300 | $ | (58,228 | ) | 3 | $ | 2,508,681 | $ | (147,287 | ) | |||||||||||||||
Total
|
$ | 8,909,685 | $ | (177,246 | ) | 30 | $ | 2,454,576 | $ | (131,399 | ) | 9 | $ | 11,364,261 | $ | (308,645 | ) | |||||||||||||||
December 31, 2013
|
||||||||||||||||||||||||||||||||
Less than 12 months
|
12 months or more
|
Total
|
||||||||||||||||||||||||||||||
|
No. of
|
No. of
|
Aggregate
|
|||||||||||||||||||||||||||||
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
Positions
|
Fair
|
Unrealized
|
|||||||||||||||||||||||||
Categor
y
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
Held
|
Value
|
Losses
|
||||||||||||||||||||||||
Fixed-Maturity Securities:
|
||||||||||||||||||||||||||||||||
Political subdivisions of
|
||||||||||||||||||||||||||||||||
States, Territories and
|
||||||||||||||||||||||||||||||||
Possessions
|
$ | 2,015,437 | $ | (49,491 | ) | 6 | $ | 415,866 | $ | (45,140 | ) | 2 | $ | 2,431,303 | $ | (94,631 | ) | |||||||||||||||
Corporate and other
|
||||||||||||||||||||||||||||||||
bonds industrial and
|
||||||||||||||||||||||||||||||||
miscellaneous
|
6,447,605 | (179,810 | ) | 24 | 1,430,377 | (101,194 | ) | 5 | 7,877,982 | (281,004 | ) | |||||||||||||||||||||
Total fixed-maturity
|
||||||||||||||||||||||||||||||||
securities
|
$ | 8,463,042 | $ | (229,301 | ) | 30 | $ | 1,846,243 | $ | (146,334 | ) | 7 | $ | 10,309,285 | $ | (375,635 | ) | |||||||||||||||
Equity Securities:
|
||||||||||||||||||||||||||||||||
Preferred stocks
|
$ | 1,835,958 | $ | (251,525 | ) | 8 | $ | 444,100 | $ | (62,551 | ) | 2 | $ | 2,280,058 | $ | (314,076 | ) | |||||||||||||||
Common stocks
|
879,525 | (38,785 | ) | 4 | 145,625 | (13,913 | ) | 1 | 1,025,150 | (52,698 | ) | |||||||||||||||||||||
Total equity securities
|
$ | 2,715,483 | $ | (290,310 | ) | 12 | $ | 589,725 | $ | (76,464 | ) | 3 | $ | 3,305,208 | $ | (366,774 | ) | |||||||||||||||
Total
|
$ | 11,178,525 | $ | (519,611 | ) | 42 | $ | 2,435,968 | $ | (222,798 | ) | 10 | $ | 13,614,493 | $ | (742,409 | ) |
Three Months Ended March 31,
|
2014
|
2013
|
||||||
Cash flows provided by (used in):
|
||||||||
Operating activities
|
$ | 404,628 | $ | 2,245,045 | ||||
Investing activities
|
(11,473,404 | ) | (1,052,866 | ) | ||||
Financing activities
|
(290,664 | ) | (603,637 | ) | ||||
Net (decrease) increase in cash and cash equivalents
|
(11,359,440 | ) | 588,542 | |||||
Cash and cash equivalents, beginning of period
|
19,922,506 | 2,240,012 | ||||||
Cash and cash equivalents, end of period
|
$ | 8,563,066 | $ | 2,828,554 |
Treaty
|
Extent of Loss
|
Risk Retained
(1)
|
||
Personal Lines
|
Initial $1,200,000
|
$300,000
|
||
$1,200,000 - $2,900,000
|
None
|
|||
Over $2,900,000
|
100%
|
|||
Personal Umbrella
|
Initial $1,000,000
|
$100,000
|
||
$1,000,000 - $2,000,000
|
None
|
|||
Over $2,000,000
|
100%
|
|||
Commercial Lines
|
Initial $400,000
|
$300,000
|
||
$400,000 - $2,900,000
|
None
|
|||
Over $2,900,000
|
100%
|
|||
Commercial Auto
|
Initial $300,000
|
$300,000
|
||
$300,000 - $2,000,000
|
None
|
|||
Over $2,000,000
|
100%
|
|||
Catastrophe
|
Initial $4,000,000
|
$1,000,000
|
||
$4,000,000 - $90,000,000
|
None
|
|||
Over $90,000,000
|
100%
|
(1)
|
Catastrophe coverage is limited on an annual basis to two times the per occurrence amounts.
|
Exhibit No. | Description | |
3(a)
|
Restated Certificate of Incorporation, as amended
|
|
3(b)
|
By-laws, as amended
1
|
|
|
|
|
31(a)
|
Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
31(b)
|
Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
32
|
Certification of Chief Executive Officer and Chief Financial Officer Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
101.INS
|
XBRL Instance Document
|
|
|
|
|
101.SCH
|
101.SCH XBRL Taxonomy Extension Schema.
|
|
|
|
|
101.CAL
|
101.CAL XBRL Taxonomy Extension Calculation Linkbase.
|
|
|
|
|
101.DEF
|
101.DEF XBRL Taxonomy Extension Definition Linkbase.
|
|
|
|
|
101.LAB
|
101.LAB XBRL Taxonomy Extension Label Linkbase.
|
|
|
|
|
101.PRE
|
101.PRE XBRL Taxonomy Extension Presentation Linkbase.
|
KINGSTONE COMPANIES, INC.
|
|||
Date: May 15, 2014
|
By:
|
/s/ Barry B. Goldstein | |
Barry B. Goldstein | |||
President
|
|||
Date: May 15, 2014
|
By:
|
/s/ Victor Brodsky | |
Victor Brodsky
|
|||
Chief Financial Officer
|
|||
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the small business issuer’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the small business issuer’s internal control over financial reporting that occurred during the small business issuer’s most recent fiscal quarter (the small business issuer’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer’s internal control over financial reporting; and
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer’s internal control over financial reporting.
|
Date: May 15, 2014
|
/
s/ Barry B. Goldstein
Barry B. Goldstein
Principal Executive Officer
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the small business issuer’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the small business issuer’s internal control over financial reporting that occurred during the small business issuer’s most recent fiscal quarter (the small business issuer’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer’s internal control over financial reporting; and
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer’s internal control over financial reporting.
|
Date: May 15, 2014
|
/s/ Victor Brodsky
Victor Brodsky
Principal Financial Officer
|
Date: May 15, 2014
|
/
s/ Barry B. Goldstein
Barry B. Goldstein
Chief Executive Officer
|
/s/ Victor Brodsky
Victor Brodsky
Chief Financial Officer
|