Donegal Group Reports $7.7M Q4 Net Income

February 22, 2016

Donegal Group Inc. reported $7.76 million in net income for the 2015 fourth quarter, up 73 percent from $4.49 million during the same period in 2014.

The full-year 2015 net income jumped to $26.77 million, an 84 percent increase from $14.54 million recorded for 2014, the Marietta, Pennsylvania-based insurer reported on Feb. 19.

The improvement between years was largely attributable to a lower level of weather-related losses in 2015 and lower prior accident year loss reserve development compared to 2014, Donegal said.

Net premiums written rose compared to a year ago on both a quarterly and full-year basis, mostly reflecting growth in commercial lines.

Net premiums written for the 2015 fourth quarter were $147.71 million ($83.98 million in personal lines and $63.73 million in commercial lines). That’s up 9 percent from $135.34 million ($80.08 million in personal lines and $55.27 million in commercial lines) during the same period in 2014.

Net premiums written for the full-year 2015 were $628.84 million ($352.33 million in personal lines and $276.51 million in commercial lines), an 8 percent increase from $579.20 million ($334.74 million in personal lines and $244.46 million in commercial lines) in 2014.

The combined ratio for the 2015 fourth quarter was 98.9 percent, compared with 101.6 percent a year ago. The full-year 2015 combined ratio was 99.0 percent, improving from 101.7 percent in 2014.

Net investment income for the 2015 fourth quarter was $5.44 million, a 13 percent increase from $4.82 million a year ago. The full-year 2015 net investment income was $20.95 million, up 14 percent from $18.34 million for 2014.

“Donegal Group achieved strong performance across nearly all lines of business in 2015, with full-year earnings nearly double the prior-year amount,” Donegal Group President and CEO Kevin G. Burke said.

Commenting on pricing trends, Burke said during the Feb. 19 earnings conference call that Donegal filed rate increases in the homeowners in the 2 to 4 percent range, depending upon the state and subsidiary. Rate increases in personal auto ranged in the low-single-digits, depending upon the state and subsidiary.

Burke said that in commercial lines, renewal premium increases during the 2015 fourth quarter generally range from 3 to 5 percent. “While we continue to see opportunities to obtain renewal premium increases, we have experienced increased competition for quality accounts,” he said.

 

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