United Fire Group Inc (UFCS, Financial) released its Q3 2023 earnings report on November 1, 2023. The company reported a consolidated net income of $6.4 million ($0.25 per diluted share) and consolidated adjusted operating income of $0.31 per diluted share. The company's net premiums written increased slightly by 0.1% to $247.7 million compared to the third quarter of 2022. Core commercial lines growth was 2.7%, driven by increasing levels of rate achievement and new business.
Financial Performance
The company's GAAP combined ratio was 102.1%, including an underlying loss ratio of 60.5% and catastrophe loss ratio of 5.9%. The expense ratio was 35.5%. The underlying combined ratio was 96.0%. Net investment income of $16.5 million increased 41.8% compared to the third quarter of 2022. However, the book value per common share decreased 13.0% to $25.53 as of September 30, 2023, compared to December 31, 2022.
Company's Commentary
Our third quarter results show signs of improvement while we continue to execute strategies to strengthen our Company. Net written premium was flat in the quarter as growth in our core commercial and assumed reinsurance business was offset by targeted underwriting action on underperforming segments as well as increased surety reinsurance reinstatement premiums," said UFG President and CEO Kevin Leidwinger.
Financial Highlights
The company's net premiums earned were $259.4 million, and net premiums written were $247.7 million. The net underlying loss ratio was 60.5%, and the catastrophe effect on net loss ratio was 5.9%. The GAAP combined ratio was 102.1%, and the underlying combined ratio was 96.0%. Net investment income, net of investment expenses, was $16.5 million.
Balance Sheet and Capital Management
As of September 30, 2023, the company's total consolidated assets were $3.1 billion, which included $1.8 billion of invested assets. The company’s book value per share was $25.53, a decrease of $3.83 per share, or 13.0%, from December 31, 2022. During the third quarter of 2023, the company declared and paid a $0.16 per share cash dividend to shareholders of record as of September 1, 2023.
Explore the complete 8-K earnings release (here) from United Fire Group Inc for further details.
