State Auto Financial Corporation (STFC)

BOSTON, March 1, 2022 /PRNewswire/ -- Liberty Mutual Insurance has completed the acquisition of State Auto Group, a super-regional property and casualty insurance holding company headquartered in Columbus, Ohio that distributes personal and small commercial coverages in 33 states through approximately 3,400 independent agents. More than 2,000 State Auto employees will join Liberty Mutual's Global Retail Markets US business unit.

State Auto Financial (STFC) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

COLUMBUS, Ohio--(BUSINESS WIRE)--Kim Garland is expected to be appointed president of State Auto following the completion of Liberty Mutual's pending acquisition.

COLUMBUS, Ohio--(BUSINESS WIRE)--State Auto Financial Corporation (NASDAQ:STFC) (“State Auto”) today announced the intention of Liberty Mutual Insurance (“Liberty Mutual”) to appoint Kim Garland, currently senior vice president of personal & commercial lines and managing director of State Auto Labs, as president of State Auto following the completion of Liberty Mutual’s pending acquisition. The deal is expected to close in 2022, pending receipt of required regulatory approvals and other customary closing conditions. “Kim has been instrumental in the transformation that we began in 2015, and he’s the right person to lead State Auto into a new future,” said STFC Chairman, President and CEO Mike LaRocco. “He’s produced results in regional, national and global companies and developed considerable experience in driving innovation both inside and outside the insurance industry. I know Kim will be focused every day on State Auto’s growth and profitability, an effective transition and the success of the State Auto team.” Since joining State Auto in 2015, Garland’s roles have included leading personal lines, leading commercial lines and helping found State Auto Labs, State Auto’s corporate venture capital fund. Garland also led the rebuild and restructuring of State Auto’s personal lines and commercial lines businesses. Before joining State Auto, Garland was chief product officer for AIG’s Global P&C Consumer Division. Previously at AIG, he helped lead the restructuring of United Guaranty, AIG’s mortgage insurance company, as its chief operating officer and later, CEO. Before joining AIG, he managed the personal auto business at Safeco prior to its 2008 acquisition by Liberty Mutual, and also started Safeco’s former innovation company. Garland began his insurance career at GEICO, where he held actuarial, product management roles and customer service roles. He is a member of the board of directors of Rev1 Ventures, a Columbus-based startup accelerator and venture capital fund. Garland is a Fellow of the Casualty Actuarial Society (FCAS), with an undergraduate degree from Florida State University and a graduate degree from the University of Virginia, both in Mathematics. About State Auto Financial Corporation State Auto Financial Corporation, headquartered in Columbus, Ohio, is a super regional property and casualty insurance holding company. STFC stock is traded on the NASDAQ Global Select Market, which represents the top fourth of all NASDAQ listed companies. The insurance subsidiaries of State Auto Financial Corporation are part of the State Auto Group. The State Auto Group markets its insurance products throughout the United States, through independent insurance agencies, which include retail agencies and wholesale brokers. The State Auto Group is rated A- (Excellent) by the A.M. Best Company and includes State Automobile Mutual, State Auto Property & Casualty, State Auto Ohio, State Auto Wisconsin, Milbank, Meridian Security, Patrons Mutual, Rockhill Insurance, Plaza Insurance, American Compensation and Bloomington Compensation. Additional information on State Auto Financial Corporation and the State Auto Insurance Companies can be found online at http://www.StateAuto.com/STFC. Cautionary Notice Regarding Forward-Looking Statements Except for historical information, all other information in this press release consists of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, and related oral statements State Auto Financial Corporation (“STFC”) may make, are subject to risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. For example, (1) conditions to the closing of the transactions may not be satisfied; (2) regulatory approvals required for the transactions may not be obtained, or required regulatory approvals may delay the transactions or result in the imposition of conditions that could have a material adverse effect on Liberty Mutual Holding Company Inc. (“LMHC”), State Automobile Mutual Insurance Company (“SAM”) or STFC or cause the parties to abandon the transactions; (3) uncertainty as to the timing of completion of the transactions; (4) the business of LMHC, SAM or STFC may suffer as a result of uncertainty surrounding the transactions; (5) the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; (6) risks related to disruption of management’s attention from the ongoing business operations of LMHC, SAM or STFC due to the transactions; (7) the effect of the announcement of the transactions on the relationships of LMHC, SAM or STFC with its clients, operating results and business generally; (8) the outcome of any legal proceedings to the extent initiated against LMHC, SAM or STFC following the announcement of the proposed transaction; and (9) LMHC, SAM or STFC may be adversely affected by other economic, business, and/or competitive factors as well as management’s response to any of the aforementioned factors. The foregoing review of important factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included herein and elsewhere, including the risk factors included in STFC’s most recent Annual Report on Form 10-K, STFC’s most recent Quarterly Report on Form 10-Q, the definitive proxy statement filed by STFC with the Securities Exchange Commission (the “SEC”) on Aug. 27, 2021, and other documents of STFC on file with the SEC. STFC undertakes no obligation to update or revise any forward-looking statements.

COLUMBUS, Ohio--(BUSINESS WIRE)---- $STFC #earnings--Today the board of directors of State Auto Financial Corporation (NASDAQ:STFC) declared a regular quarterly cash dividend of $0.10 per share.

COLUMBUS, Ohio--(BUSINESS WIRE)--Today the board of directors of State Auto Financial Corporation (NASDAQ:STFC) declared a regular quarterly cash dividend of $0.10 per share, payable Dec. 28, 2021, to shareholders of record at the close of business on Dec. 15, 2021. This is the 122nd consecutive quarterly cash dividend declared by the company's board since STFC had its initial public offering of common stock in 1991. About State Auto Financial Corporation State Auto Financial Corporation, headquartered in Columbus, Ohio, is a super regional property and casualty insurance holding company. STFC stock is traded on the NASDAQ Global Select Market, which represents the top fourth of all NASDAQ listed companies. The insurance subsidiaries of State Auto Financial Corporation are part of the State Auto Group. The State Auto Group markets its insurance products throughout the United States, through independent insurance agencies, which include retail agencies and wholesale brokers. The State Auto Group is rated A- (Excellent) by the A.M. Best Company and includes State Automobile Mutual, State Auto Property & Casualty, State Auto Ohio, State Auto Wisconsin, Milbank, Meridian Security, Patrons Mutual, Rockhill Insurance, Plaza Insurance, American Compensation and Bloomington Compensation. Additional information on State Auto Financial Corporation and the State Auto Insurance Companies can be found online at http://www.StateAuto.com/STFC.

COLUMBUS, Ohio--(BUSINESS WIRE)---- $STFC #STFC--State Auto Financial Reports Third Quarter 2021 Results

COLUMBUS, Ohio--(BUSINESS WIRE)--State Auto Financial Corporation (NASDAQ:STFC) today reported a third quarter 2021 net loss of $14.3 million, or $0.32 per diluted share, compared to net income of $11.6 million, or $0.26 per diluted share, for the same 2020 period. Net loss from operations1 per diluted share for the third quarter of 2021 was $0.18 versus $0.10 for the same 2020 period. STFC’s GAAP combined ratio for the third quarter 2021 was 105.3 compared to 106.0 for the same 2020 period. For the first nine months of 2021, STFC had a net loss of $10.1 million, or $0.23 per diluted share, compared to $68.7 million, or $1.57 per diluted share, for the same 2020 period. Net loss from operations1 per diluted share for the first nine months of 2021 was $1.25 versus $0.86 for the same 2020 period. STFC’s GAAP combined ratio for the first nine months of 2021 was 109.4 compared to 109.3 for the same 2020 period. SAP Operating Results STFC's SAP combined ratio for the third quarter 2021 was 103.5 compared to 105.1 for the same 2020 period. Catastrophe losses and ALAE during the third quarter 2021 accounted for 10.3 points of the 75.1 total loss ratio points, or $39.4 million, versus 16.6 points of the 71.3 total loss ratio points, or $58.7 million, for the same period in 2020. The third quarter 2021 was impacted by severe weather events in the Midwest and Texas. Approximately 60% of the third quarter 2021 catastrophe losses occurred within homeowners. The current accident year non-catastrophe loss and ALAE ratio accounted for 60.5 points of the total loss ratio points, or $231.1 million, versus 55.0 points of the total loss ratio points, or $194.3 million, for the same 2020 period. The third quarter 2021 was impacted by elevated claim frequency and severity in personal auto and commercial auto. Non-catastrophe losses and ALAE during the third quarter 2021 included 1.3 points of favorable development relating to prior years, or $5.0 million, versus 5.5 points of favorable development, or $19.3 million, for the same period in 2020. Underwriting expenses during the third quarter 2021 accounted for 28.4 points of the total combined ratio points, or $118.6 million, versus 33.8 points of the total combined ratio points, or $127.9 million for the same 2020 period. The third quarter 2021 was impacted by decreases in estimated variable agent compensation and IT development costs when compared to the same 2020 period. STFC's SAP combined ratio for the first nine months of 2021 was 107.8 compared to 108.6 for the same 2020 period. Catastrophe losses and ALAE during the first nine months of 2021 accounted for 17.2 points of the 78.2 total loss ratio points, or $191.0 million, versus 18.6 points of the 74.5 total loss ratio points, or $191.0 million, for the same period in 2020. The first nine months of 2021 were impacted by winter storms Uri and Viola in Texas, which added 5.6 points to the loss and ALAE ratio. Approximately 70% of the year to date 2021 catastrophe losses occurred within homeowners. The current accident year non-catastrophe loss and ALAE ratio accounted for 59.3 points of the total loss ratio points, or $656.8 million, versus 53.0 points of the total loss ratio points, or $542.4 million, for the same 2020 period. In addition to the factors discussed above, the first nine months of 2021 were impacted by elevated frequency and severity of property losses in homeowners. Non-catastrophe losses and ALAE during the third quarter 2021 included 4.1 points of favorable development relating to prior years, or $45.5 million, versus 3.1 points of favorable development, or $31.8 million, for the same period in 2020. Underwriting expenses during the first nine months of 2021 accounted for 29.6 points of the total combined ratio points, or $352.4 million, versus 34.1 points of the total combined ratio points, or $377.1 million for the same 2020 period. In addition to the factors discussed above, the first nine months of 2021 were impacted by a decrease in associate benefit costs when compared to the same 2020 period. Net written premium for the third quarter 2021 increased 10.2% compared to the same period in 2020. By insurance segment, net written premium for the commercial insurance segment increased 17.1% and the personal insurance segment increased 5.7%. The increase in the commercial segment was primarily driven by (i) new business growth and rate increases in commercial auto and farm & ranch, (ii) rate increases in middle market commercial, and (iii) new business growth in workers' compensation driven by its launch on State Auto Connect. The increase in the personal segment was primarily due to increased rates in homeowners and other personal and new business growth in other personal. The net written premium growth was partially offset by a decline in new business in personal auto. Net written premium for the first nine months of 2021 increased 7.4% compared to the same period in 2020. By insurance segment, net written premium for the commercial insurance segment increased 16.1% and the personal insurance segment increased 1.5%. Net written premiums for the first nine months of 2021 were impacted by the same factors discussed above for the third quarter. The third quarter and first nine months of 2021 were also impacted by the following expenses incurred as a result of the pending Liberty Mutual merger: (i) a $9.3 million increase in the valuation of the Director RSU awards as a result of the increase in our stock price; and (ii) $2.9 million of legal and investment banking fees and expenses. These expenses were included in "other expenses" on the condensed consolidated statements of income. Book Value and Return on Equity STFC’s book value decreased to $21.49 per share as of September 30, 2021, compared to $22.18 on June 30, 2021. The decrease in book value was primarily driven by a decrease in the fair market value of fixed income investments attributable to higher interest rates. Return on stockholders’ equity for the 12 months ended September 30, 2021, was 7.5% compared to (3.8)% for the 12 months ended September 30, 2020. STFC’s Chairman, President and CEO Mike LaRocco commented on the quarter as follows: "The third quarter statutory combined ratio of 103.5 was impacted by higher claim frequency and severity in both personal and commercial auto and wind and hail events in the Midwest and Texas. "Overall net written premium growth of 10.2% included a 17.1% increase in commercial lines with a 99.7% statutory combined ratio in the segment. In personal lines, net written premium increased 5.7% with a 106.6% statutory combined ratio. Expense ratio improvement continued, with a 28.4% result compared to 33.8% for third quarter 2020. "We remain focused on continuing our progress toward consistent profitable growth. At the same time, efforts continue toward our planned acquisition by Liberty Mutual, which remains on track to close in 2022, pending appropriate member and regulatory approvals. This transaction furthers our commitment to independent agents and will contribute to the collective success of our agents, policyholders and associates." About State Auto Financial Corporation State Auto Financial Corporation, headquartered in Columbus, Ohio, is a super regional property and casualty insurance holding company. STFC stock is traded on the Nasdaq Global Select Market, which represents the top fourth of all Nasdaq listed companies. The insurance subsidiaries of State Auto Financial Corporation are part of the State Auto Group. The State Auto Group markets its insurance products throughout the United States, through independent insurance agencies. The State Auto Group is rated A- (Excellent) by the A.M. Best Company and includes State Automobile Mutual, State Auto Property & Casualty, State Auto Ohio, State Auto Wisconsin, Milbank, Meridian Security, Patrons Mutual, Rockhill Insurance, Plaza Insurance, American Compensation and Bloomington Compensation. Additional information on State Auto Financial Corporation and the State Auto Insurance Companies can be found online at http://www.StateAuto.com/STFC. 1 Net earnings (loss) from operations, a non-GAAP financial measure which management believes is informative to Company management and investors, differs from GAAP net income (loss) only by the exclusion of net investment gain (loss), net of applicable taxes, on investment activity for the periods being reported. For STFC, this amounted to a loss of $0.14 per diluted share and income of $1.02 per diluted share for the third quarter and year to date 2021, respectively, versus income of $0.36 per diluted share and a loss of $0.71 per diluted share for the third quarter and year to date 2020, respectively. Except for historical information, all other information in this news release consists of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. The most significant of these uncertainties are described in State Auto Financial's Form 10-K and Form 10-Q reports and exhibits to those reports, and include (but are not limited to) legislative changes at both the state and federal level, state and federal regulatory rule making promulgations and adjudications, class action litigation involving the insurance industry and judicial decisions affecting claims, policy coverages and the general costs of doing business, the impact of competition on products and pricing, inflation in the costs of the products and services insurance pays for, product development, geographic spread of risk, weather and weather-related events, and other types of catastrophic events. State Auto Financial undertakes no obligation to update or revise any forward-looking statements. Selected Consolidated Financial Data ($ in millions, except per share amounts) (unaudited) Three months ended September 30 Nine months ended September 30 2021 2020 2021 2020 Net premiums written $ 417.7 $ 379.1 $ 1,188.7 $ 1,107.2 Earned premiums 381.8 353.2 1,107.6 1,024.4 Net investment income 17.0 17.9 52.3 54.5 Net investment (loss) gain (8.1 ) 20.0 56.8 (39.3 ) Other income 0.4 0.5 1.3 1.6 Total revenue 391.1 391.6 1,218.0 1,041.2 (Loss) income before federal income taxes (25.7 ) 14.8 (15.9 ) (87.6 ) Federal tax (benefit) expense (11.4 ) 3.2 (5.8 ) (18.9 ) Net (loss) income $ (14.3 ) $ 11.6 $ (10.1 ) $ (68.7 ) (Loss) earnings per common share: - basic $ (0.32 ) $ 0.26 $ (0.23 ) $ (1.57 ) - diluted $ (0.32 ) $ 0.26 $ (0.23 ) $ (1.57 ) Loss per share from operations(A): - basic $ (0.18 ) $ (0.10 ) $ (1.25 ) $ (0.86 ) - diluted $ (0.18 ) $ (0.10 ) $ (1.25 ) $ (0.86 ) Weighted average shares outstanding: - basic 44.3 43.8 44.1 43.7 - diluted 44.3 44.3 44.1 43.7 Return on average equity (LTM) 7.5 % (3.8 )% Book value per share $ 21.49 $ 21.57 Dividends paid per share $ 0.10 $ 0.10 $ 0.30 $ 0.30 Total shares outstanding 44.4 43.8 GAAP ratios: Cat loss and ALAE ratio 10.3 16.6 17.2 18.6 Non-cat loss and LAE ratio 64.9 54.6 61.2 55.8 Loss and LAE ratio 75.2 71.2 78.4 74.4 Expense ratio 30.1 34.8 31.0 34.9 Combined ratio 105.3 106.0 109.4 109.3 (A) Reconciliation of non-GAAP financial measure: Net loss from operations: Net (loss) income $ (14.3 ) $ 11.6 $ (10.1 ) $ (68.7 ) Net investment (loss) gain, net of tax (6.4 ) 15.8 44.9 (31.0 ) Net loss from operations $ (7.9 ) $ (4.2 ) $ (55.0 ) $ (37.7 ) Condensed Consolidated Balance Sheets ($ and shares in millions, except per share amounts) (unaudited) September 30 December 31 2021 2020 ASSETS Fixed maturities, available-for-sale, at fair value (amortized cost $2,159.6 and $2,117.0, respectively) $ 2,223.5 $ 2,237.2 Equity securities 376.0 389.7 Other invested assets 79.3 71.1 Other invested assets, at cost 10.4 12.1 Notes receivable from affiliate 70.0 70.0 Total investments 2,759.2 2,780.1 Cash and cash equivalents 46.1 90.7 Accrued investment income and other assets 30.7 29.7 Premiums Receivable 14.1 14.0 Deferred policy acquisition costs 131.5 122.2 Reinsurance recoverable on losses and loss expenses payable 19.6 24.3 Prepaid reinsurance premiums 8.7 8.3 Due from affiliate 28.7 — Current federal income taxes 1.8 1.7 Net deferred federal income taxes 43.1 27.3 Property and equipment, at cost 3.8 4.2 Total assets $ 3,087.3 $ 3,102.5 LIABILITIES Losses and loss expenses payable $ 1,059.7 $ 1,050.4 Unearned premiums 805.0 723.4 Notes payable (affiliates $15.3 and $15.3, respectively) 122.1 122.1 Pension and postretirement benefits 45.0 66.2 Due to affiliate — 11.2 Other liabilities 100.6 119.2 Total liabilities 2,132.4 2,092.5 STOCKHOLDERS' EQUITY Common stock, without par value. Authorized 100.0 shares; 51.3 and 50.7 shares issued, respectively, at stated value of $2.50 per share 128.4 126.8 Treasury stock, 6.9 and 6.9 shares, respectively, at cost (118.8 ) (118.4 ) Additional paid-in capital 218.1 213.3 Accumulated other comprehensive (loss) income (23.8 ) 13.9 Retained earnings 751.0 774.4 Total stockholders' equity 954.9 1,010.0 Total liabilities and stockholders' equity $ 3,087.3 $ 3,102.5 Condensed Consolidated Statements of Income ($ in millions, except per share amounts) (unaudited) Three months ended September 30 Nine months ended September 30 2021 2020 2021 2020 Earned premiums $ 381.8 $ 353.2 $ 1,107.6 $ 1,024.4 Net investment income 17.0 17.9 52.3 54.5 Net investment (loss) gain (8.1 ) 20.0 56.8 (39.3 ) Other income from affiliates 0.4 0.5 1.3 1.6 Total revenues 391.1 391.6 1,218.0 1,041.2 Losses and loss expenses 287.2 251.6 867.8 762.2 Acquisition and operating expenses 115.0 123.0 343.2 357.4 Interest expense 1.1 1.1 3.3 3.6 Other expenses 13.5 1.1 19.6 5.6 Total expenses 416.8 376.8 1,233.9 1,128.8 (Loss) income before federal income taxes (25.7 ) 14.8 (15.9 ) (87.6 ) Federal income tax (benefit) expense: Current (0.1 ) — (0.1 ) (0.4 ) Deferred (11.3 ) 3.2 (5.7 ) (18.5 ) Federal income tax (benefit) expense (11.4 ) 3.2 (5.8 ) (18.9 ) Net (loss) income $ (14.3 ) $ 11.6 $ (10.1 ) $ (68.7 ) (Loss) earnings per common share: Basic $ (0.32 ) $ 0.26 $ (0.23 ) $ (1.57 ) Diluted $ (0.32 ) $ 0.26 $ (0.23 ) $ (1.57 ) Dividends paid per common share $ 0.10 $ 0.10 $ 0.30 $ 0.30 Consolidated Statements of Comprehensive (Loss) Income ($ in millions) (unaudited) Three months ended September 30 Nine months ended September 30 2021 2020 2021 2020 Net (loss) income $ (14.3 ) $ 11.6 $ (10.1 ) $ (68.7 ) Other comprehensive income (loss), net of tax: Net unrealized holding (loss) gain on available-for-sale investments: Unrealized holding (loss) gain (17.1 ) 4.6 (56.6 ) 74.5 Reclassification adjustments for losses (gains) realized in net income 1.0 0.2 0.3 (3.2 ) Income tax benefit (expense) 3.3 (1.1 ) 11.8 (15.0 ) Total net unrealized holding (loss) gain on available- for-sale investments (12.8 ) 3.7 (44.5 ) 56.3 Net unrecognized benefit plan obligations: Reclassification adjustments for amortization to statements of income: Prior service credit (1.6 ) (1.6 ) (4.8 ) (4.8 ) Net actuarial loss 4.5 3.7 13.4 11.0 Income tax expense (0.6 ) (0.4 ) (1.8 ) (1.3 ) Total net unrecognized benefit plan obligations 2.3 1.7 6.8 4.9 Other comprehensive (loss) income (10.5 ) 5.4 (37.7 ) 61.2 Comprehensive (loss) income $ (24.8 ) $ 17.0 $ (47.8 ) $ (7.5 ) Condensed Consolidated Statement of Stockholders' Equity ($ and shares in millions) (unaudited) Nine Months Ended Year Ended September 30 December 31 2021 2020 Common shares: Balance at beginning of year 50.7 50.4 Issuance of shares 0.6 0.3 Balance at period ended 51.3 50.7 Treasury shares: Balance at beginning of year (6.9 ) (6.9 ) Balance at period ended (6.9 ) (6.9 ) Common stock: Balance at beginning of year $ 126.8 $ 125.9 Issuance of shares 1.6 0.9 Balance at period ended 128.4 126.8 Treasury stock: Balance at beginning of year $ (118.4 ) $ (117.5 ) Shares acquired on stock award exercises and vested restricted shares (0.4 ) (0.9 ) Balance at beginning of year and period ended (118.8 ) (118.4 ) Additional paid-in capital: Balance at beginning of year $ 213.3 $ 206.7 Issuance of common stock 6.9 3.0 Stock awards granted (2.1 ) 3.6 Balance at period ended 218.1 213.3 Accumulated other comprehensive (loss) income: Balance at beginning of the year $ 13.9 $ (26.9 ) Change in net unrealized holding (losses) gains on available-for-sale investments (44.5 ) 56.7 Change in net unrecognized benefit plan obligations 6.8 (15.9 ) Balance at period ended (23.8 ) 13.9 Retained earnings: Balance at beginning of year $ 774.4 $ 779.3 Cumulative effect of change in accounting to establish an allowance for expected credit losses at January 1, 2020 — (0.5 ) Net (loss) income (10.1 ) 13.1 Cash dividends paid (13.3 ) (17.5 ) Balance at period ended 751.0 774.4 Total stockholders' equity at period ended $ 954.9 $ 1,010.0 Condensed Consolidated Statements of Cash Flow ($ in millions) (unaudited) Nine months ended September 30 2021 2020 Cash flows from operating activities: Net loss $ (10.1 ) $ (68.7 ) Adjustments to reconcile net loss to net cash (used in) provided by operating activities Depreciation and amortization, net 4.7 7.6 Share-based compensation 9.5 — Net investment (gain) loss (57.2 ) 39.3 Changes in operating assets and liabilities: Deferred policy acquisition costs (9.3 ) (12.6 ) Accrued investment income and other assets (1.0 ) 0.6 Premiums receivable (0.1 ) (0.5 ) Postretirement and pension benefits (17.5 ) (17.0 ) Reinsurance recoverable on losses and loss expenses payable and prepaid reinsurance premiums 4.3 (22.5 ) Other liabilities and due to/from affiliates, net (63.0 ) 8.5 Losses and loss expenses payable 9.3 24.2 Unearned premiums 81.6 81.8 Deferred tax on share-based awards 1.4 (0.1 ) Federal income taxes (7.2 ) (18.8 ) Net cash (used in) provided by operating activities (54.6 ) 21.8 Cash flows from investing activities: Purchases of fixed maturities available-for-sale (570.4 ) (462.6 ) Purchases of equity securities (24.0 ) (65.6 ) Purchases of other invested assets (0.9 ) (7.3 ) Maturities, calls and pay downs of fixed maturities available-for-sale 327.5 274.9 Sales of fixed maturities available-for-sale 195.6 216.1 Sales of equity securities 87.4 86.2 Sales of other invested assets 2.3 0.9 Disposals of property and equipment — 0.2 Net cash provided by investing activities 17.5 42.8 Cash flows from financing activities: Proceeds from issuance of common stock 6.2 2.8 Payments to acquire treasury stock (0.4 ) (0.9 ) Payment of dividends (13.3 ) (13.1 ) Proceeds from short-term debt — 60.0 Repayment of short-term debt — (60.0 ) Proceeds from long-term debt — 21.5 Repayment of long-term debt — (21.5 ) Net cash used in financing activities (7.5 ) (11.2 ) Net (decrease) increase in cash and cash equivalents (44.6 ) 53.4 Cash and cash equivalents at beginning of period 90.7 78.0 Cash and cash equivalents at end of period $ 46.1 $ 131.4 Supplemental disclosures: Interest paid (affiliates $0.5 and $0.6, respectively) $ 3.3 $ 3.5 Net Investment Income ($ in millions) (unaudited) 9/30/2020 12/31/2020 3/31/2021 6/30/2021 9/30/2021 Quarter to Date Gross investment income: Fixed maturities $ 13.7 $ 14.3 $ 14.7 $ 13.4 $ 12.9 TIPS 1.3 0.7 0.7 2.0 2.3 Total fixed maturities 15.0 15.0 15.4 15.4 15.2 Equity securities 2.1 1.5 1.6 1.2 1.2 Other 0.9 1.3 0.9 1.1 1.0 Total gross investment income 18.0 17.8 17.9 17.7 17.4 Less: Investment expenses 0.1 0.2 0.3 — 0.4 Net investment income $ 17.9 $ 17.6 $ 17.6 $ 17.7 $ 17.0 Year to Date Gross investment income: Fixed maturities $ 43.0 $ 57.3 $ 14.7 $ 28.1 $ 41.0 TIPS 1.6 2.3 0.7 2.7 5.0 Total fixed maturities 44.6 59.6 15.4 30.8 46.0 Equity securities 7.8 9.3 1.6 2.8 4.0 Other 2.7 4.0 0.9 2.0 3.0 Total gross investment income 55.1 72.9 17.9 35.6 53.0 Less: Investment expenses 0.6 0.8 0.3 0.3 0.7 Net investment income $ 54.5 $ 72.1 $ 17.6 $ 35.3 $ 52.3 9/30/2020 12/31/2020 3/31/2021 6/30/2021 9/30/2021 TIPS, fair value $ 117.0 $ 116.2 $ 104.7 $ 108.2 $ 109.8 TIPS, book value $ 99.4 $ 97.8 $ 89.2 $ 90.9 $ 92.8 Net Investment (Loss) Gain ($ in millions) unaudited Three months ended September 30 Nine months ended September 30 2021 2020 2021 2020 Investment gain (loss), net: Fixed maturities: Realized gains on sales of securities $ 0.4 $ 1.3 $ 4.3 $ 6.8 Realized losses on sales of securities (1.4 ) (1.5 ) (4.6 ) (3.6 ) Net (loss) gain on fixed securities (1.0 ) (0.2 ) (0.3 ) 3.2 Net (loss) gain on equity securities (6.7 ) 18.2 49.7 (35.1 ) Net (loss) gain on other invested assets (0.4 ) 2.0 7.8 (7.6 ) Other net realized (loss) gain — — (0.4 ) 0.2 Net (loss) gain on investments $ (8.1 ) $ 20.0 $ 56.8 $ (39.3 ) Income Taxes ($ in millions) (unaudited) The following table sets forth the tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities: September 30 December 31 2021 2020 Deferred tax assets: Unearned premiums not currently deductible $ 33.5 $ 30.1 Losses and loss expenses payable discounting 11.6 10.5 Postretirement and pension benefits 16.3 19.3 Other liabilities 11.8 12.2 Net operating loss carryforward 36.8 19.8 Capital loss carryforward — 6.1 Tax credit carryforward 2.3 1.9 Other 1.7 1.1 Total deferred tax assets 114.0 101.0 Deferred tax liabilities: Deferral of policy acquisition costs 27.6 25.7 Investments 42.6 48.0 Total deferred tax liabilities 70.2 73.7 Total net deferred tax assets before valuation allowance 43.8 27.3 Less valuation allowance 0.7 — Net deferred federal income taxes $ 43.1 $ 27.3 The following table sets forth the components of federal income tax (benefit) expense: Three months ended September 30 Nine months ended September 30 2021 2020 2021 2020 (Loss) income before federal income taxes $ (25.7 ) $ 14.8 $ (15.9 ) $ (87.6 ) Federal income tax (benefit) expense Current (0.1 ) — (0.1 ) (0.4 ) Deferred (11.3 ) 3.2 (5.7 ) (18.5 ) Total federal income tax (benefit) expense (11.4 ) 3.2 (5.8 ) (18.9 ) Net (loss) income $ (14.3 ) $ 11.6 $ (10.1 ) $ (68.7 ) SAP Personal Insurance Segment Results (unaudited) ($ in millions) Three months ended September 30, 2021 Personal Auto Homeowners Other Personal Total Net written premiums $ 92.4 $ 127.2 $ 23.7 $ 243.3 Net earned premiums 91.8 106.5 18.9 217.2 Losses and LAE incurred: Cat loss and ALAE 1.3 22.2 0.7 24.2 Non-cat loss and ALAE Prior accident years non-cat loss and ALAE 6.8 (2.5 ) — 4.3 Current accident year non-cat loss and ALAE 67.2 55.8 9.4 132.4 Total non-cat loss and ALAE 74.0 53.3 9.4 136.7 Total Loss and ALAE 75.3 75.5 10.1 160.9 ULAE 7.9 5.3 1.0 14.2 Total Loss and LAE 83.2 80.8 11.1 175.1 Underwriting expenses 25.0 32.2 5.9 63.1 Net underwriting (loss) gain $ (16.4 ) $ (6.5 ) $ 1.9 $ (21.0 ) Cat loss and ALAE ratio 1.4 % 20.8 % 3.9 % 11.1 % Non-cat loss and ALAE ratio Prior accident years non-cat loss and ALAE ratio 7.4 % (2.4 )% (0.1 )% 2.0 % Current accident year non-cat loss and ALAE ratio 73.2 % 52.4 % 49.5 % 60.9 % Total non-cat loss and ALAE ratio 80.6 % 50.0 % 49.4 % 62.9 % Total Loss and ALAE ratio 82.0 % 70.8 % 53.3 % 74.0 % ULAE ratio 8.6 % 5.0 % 6.0 % 6.6 % Total Loss and LAE ratio 90.6 % 75.8 % 59.3 % 80.6 % Expense ratio 27.1 % 25.4 % 24.7 % 26.0 % Combined ratio 117.7 % 101.2 % 84.0 % 106.6 % ($ in millions) Three months ended September 30, 2020 Personal Auto Homeowners Other Personal Total Net written premiums $ 101.4 $ 111.4 $ 17.4 $ 230.2 Net earned premiums 103.0 92.5 13.3 208.8 Losses and LAE incurred: Cat loss and ALAE 1.9 28.1 2.9 32.9 Non-cat loss and ALAE Prior accident years non-cat loss and ALAE 8.0 0.7 (0.6 ) 8.1 Current accident year non-cat loss and ALAE 58.2 50.7 4.8 113.7 Total non-cat loss and ALAE 66.2 51.4 4.2 121.8 Total Loss and ALAE 68.1 79.5 7.1 154.7 ULAE 7.4 6.8 0.2 14.4 Total Loss and LAE 75.5 86.3 7.3 169.1 Underwriting expenses 32.0 33.2 5.2 70.4 Net underwriting (loss) gain $ (4.5 ) $ (27.0 ) $ 0.8 $ (30.7 ) Cat loss and ALAE ratio 1.9 % 30.4 % 21.5 % 15.8 % Non-cat loss and ALAE ratio Prior accident years non-cat loss and ALAE ratio 7.8 % 0.7 % (4.1 )% 3.9 % Current accident year non-cat loss and ALAE ratio 56.4 % 54.9 % 36.2 % 54.4 % Total non-cat loss and ALAE ratio 64.2 % 55.6 % 32.1 % 58.3 % Total Loss and ALAE ratio 66.1 % 86.0 % 53.6 % 74.1 % ULAE ratio 7.2 % 7.3 % 1.6 % 6.9 % Total Loss and LAE ratio 73.3 % 93.3 % 55.2 % 81.0 % Expense ratio 31.4 % 29.8 % 29.4 % 30.5 % Combined ratio 104.7 % 123.1 % 84.6 % 111.5 % ($ in millions) Nine months ended September 30, 2021 Personal Auto Homeowners Other Personal Total Net written premiums $ 273.5 $ 329.6 $ 61.9 $ 665.0 Net earned premiums 281.1 304.9 52.1 638.1 Losses and LAE incurred: Cat loss and ALAE 6.3 129.8 19.8 155.9 Non-cat loss and ALAE Prior accident years non-cat loss and ALAE 4.7 (2.1 ) (0.2 ) 2.4 Current accident year non-cat loss and ALAE 186.7 156.9 26.9 370.5 Total non-cat loss and ALAE 191.4 154.8 26.7 372.9 Total Loss and ALAE 197.7 284.6 46.5 528.8 ULAE 22.6 19.2 2.9 44.7 Total Loss and LAE 220.3 303.8 49.4 573.5 Underwriting expenses 76.3 87.0 15.9 179.2 Net underwriting loss $ (15.5 ) $ (85.9 ) $ (13.2 ) $ (114.6 ) Cat loss and ALAE ratio 2.3 % 42.6 % 38.0 % 24.4 % Non-cat loss and ALAE ratio Prior accident years non-cat loss and ALAE ratio 1.7 % (0.7 )% (0.4 )% 0.4 % Current accident year non-cat loss and ALAE ratio 66.4 % 51.4 % 51.6 % 58.1 % Total non-cat loss and ALAE ratio 68.1 % 50.7 % 51.2 % 58.5 % Total Loss and ALAE ratio 70.4 % 93.3 % 89.2 % 82.9 % ULAE ratio 8.0 % 6.3 % 5.8 % 7.0 % Total Loss and LAE ratio 78.4 % 99.6 % 95.0 % 89.9 % Expense ratio 27.9 % 26.4 % 25.6 % 26.9 % Combined ratio 106.3 % 126.0 % 120.6 % 116.8 % ($ in millions) Nine months ended September 30, 2020 Personal Auto Homeowners Other Personal Total Net written premiums $ 310.3 $ 299.1 $ 45.7 $ 655.1 Net earned premiums 311.0 262.9 35.8 609.7 Losses and LAE incurred: Cat loss and ALAE 6.5 93.4 12.0 111.9 Non-cat loss and ALAE Prior accident years non-cat loss and ALAE 19.1 2.8 (1.7 ) 20.2 Current accident year non-cat loss and ALAE 165.7 125.0 13.0 303.7 Total non-cat loss and ALAE 184.8 127.8 11.3 323.9 Total Loss and ALAE 191.3 221.2 23.3 435.8 ULAE 23.0 18.6 1.2 42.8 Total Loss and LAE 214.3 239.8 24.5 478.6 Underwriting expenses 98.5 89.7 13.7 201.9 Net underwriting loss $ (1.8 ) $ (66.6 ) $ (2.4 ) $ (70.8 ) Cat loss and ALAE ratio 2.1 % 35.5 % 33.4 % 18.4 % Non-cat loss and ALAE ratio Prior accident years non-cat loss and ALAE ratio 6.2 % 1.0 % (4.5 )% 3.3 % Current accident year non-cat loss and ALAE ratio 53.2 % 47.6 % 36.2 % 49.8 % Total non-cat loss and ALAE ratio 59.4 % 48.6 % 31.7 % 53.1 % Total Loss and ALAE ratio 61.5 % 84.1 % 65.1 % 71.5 % ULAE ratio 7.4 % 7.1 % 3.4 % 7.0 % Total Loss and LAE ratio 68.9 % 91.2 % 68.5 % 78.5 % Expense ratio 31.7 % 30.0 % 30.0 % 30.8 % Combined ratio 100.6 % 121.2 % 98.5 % 109.3 % SAP Commercial Insurance Segment Results (unaudited) ($ in millions) Three months ended September 30, 2021 Commercial Auto Small Commercial Package Middle Market Commercial Workers' Comp Farm & Ranch Other Commercial Total Net written premiums $ 51.9 $ 33.6 $ 44.0 $ 20.8 $ 18.6 $ 5.4 $ 174.3 Net earned premiums 48.7 33.8 41.7 15.9 19.0 5.3 164.4 Losses and LAE incurred: Cat loss and ALAE (0.2 ) 3.6 9.2 — 2.7 — 15.3 Non-cat loss and ALAE Prior accident years non-cat loss and ALAE 3.7 (2.4 ) (1.2 ) (6.4 ) (0.5 ) (2.4 ) (9.2 ) Current accident year non-cat loss and ALAE 42.2 16.3 17.8 11.7 6.6 3.9 98.5 Total non-cat loss and ALAE 45.9 13.9 16.6 5.3 6.1 1.5 89.3 Total Loss and ALAE 45.7 17.5 25.8 5.3 8.8 1.5 104.6 ULAE 2.9 1.2 1.3 1.0 0.6 0.1 7.1 Total Loss and LAE 48.6 18.7 27.1 6.3 9.4 1.6 111.7 Underwriting expenses 15.1 10.7 14.7 7.1 6.1 1.7 55.4 Net underwriting (loss) gain $ (15.0 ) $ 4.4 $ (0.1 ) $ 2.5 $ 3.5 $ 2.0 $ (2.7 ) Cat loss and ALAE ratio (0.4 )% 10.7 % 22.0 % — % 14.1 % (0.4 )% 9.3 % Non-cat loss and ALAE ratio Prior accident years non-cat loss and ALAE ratio 7.6 % (7.0 )% (2.9 )% (40.3 )% (2.4 )% (46.1 )% (5.6 )% Current accident year non-cat loss and ALAE ratio 86.6 % 48.0 % 42.9 % 73.9 % 35.5 % 72.8 % 60.0 % Total non-cat loss and ALAE ratio 94.2 % 41.0 % 40.0 % 33.6 % 33.1 % 26.7 % 54.4 % Total Loss and ALAE ratio 93.8 % 51.7 % 62.0 % 33.6 % 47.2 % 26.3 % 63.7 % ULAE ratio 6.0 % 3.5 % 3.1 % 6.0 % 2.7 % 1.6 % 4.2 % Total Loss and LAE ratio 99.8 % 55.2 % 65.1 % 39.6 % 49.9 % 27.9 % 67.9 % Expense ratio 29.2 % 31.7 % 33.4 % 34.3 % 32.2 % 32.2 % 31.8 % Combined ratio 129.0 % 86.9 % 98.5 % 73.9 % 82.1 % 60.1 % 99.7 % ($ in millions) Three months ended September 30, 2020 Commercial Auto Small Commercial Package Middle Market Commercial Workers' Comp Farm & Ranch Other Commercial Total Net written premiums $ 40.0 $ 31.4 $ 40.0 $ 17.4 $ 15.0 $ 5.0 $ 148.8 Net earned premiums 35.6 31.4 40.3 17.5 14.5 5.1 144.4 Losses and LAE incurred: Cat loss and ALAE 0.1 5.5 4.7 — 3.2 — 13.5 Non-cat loss and ALAE Prior accident years non-cat loss and ALAE (1.2 ) (7.5 ) (6.3 ) (7.3 ) (0.6 ) (3.6 ) (26.5 ) Current accident year non-cat loss and ALAE 20.8 17.0 20.1 14.4 5.1 3.0 80.4 Total non-cat loss and ALAE 19.6 9.5 13.8 7.1 4.5 (0.6 ) 53.9 Total Loss and ALAE 19.7 15.0 18.5 7.1 7.7 (0.6 ) 67.4 ULAE 1.7 0.5 1.3 1.1 0.5 0.1 5.2 Total Loss and LAE 21.4 15.5 19.8 8.2 8.2 (0.5 ) 72.6 Underwriting expenses 13.7 10.9 16.4 7.8 6.7 1.9 57.4 Net underwriting gain (loss) $ 0.5 $ 5.0 $ 4.1 $ 1.5 $ (0.4 ) $ 3.7 $ 14.4 Cat loss and ALAE ratio 0.4 % 17.3 % 11.6 % — % 22.1 % — % 9.3 % Non-cat loss and ALAE ratio Prior accident years non-cat loss and ALAE ratio (3.4 )% (23.8 )% (15.5 )% (41.6 )% (4.2 )% (72.6 )% (18.3 )% Current accident year non-cat loss and ALAE ratio 58.3 % 54.3 % 49.7 % 82.2 % 35.0 % 60.4 % 55.7 % Total non-cat loss and ALAE ratio 54.9 % 30.5 % 34.2 % 40.6 % 30.8 % (12.2 )% 37.4 % Total Loss and ALAE ratio 55.3 % 47.8 % 45.8 % 40.6 % 52.9 % (12.2 )% 46.7 % ULAE ratio 4.8 % 1.5 % 3.3 % 6.4 % 3.4 % 1.9 % 3.6 % Total Loss and LAE ratio 60.1 % 49.3 % 49.1 % 47.0 % 56.3 % (10.3 )% 50.3 % Expense ratio 34.2 % 34.7 % 41.0 % 45.1 % 45.1 % 38.6 % 38.6 % Combined ratio 94.3 % 84.0 % 90.1 % 92.1 % 101.4 % 28.3 % 88.9 % ($ in millions) Nine months ended September 30, 2021 Commercial Auto Small Commercial Package Middle Market Commercial Workers' Comp Farm & Ranch Other Commercial Total Net written premiums $ 160.6 $ 103.5 $ 133.7 $ 48.6 $ 61.0 $ 17.6 $ 525.0 Net earned premiums 134.6 98.6 122.6 45.6 53.3 16.0 470.7 Losses and LAE incurred: Cat loss and ALAE 1.9 12.0 14.2 — 8.8 — 36.9 Non-cat loss and ALAE Prior accident years non-cat loss and ALAE 2.8 (6.9 ) (14.7 ) (21.8 ) (2.0 ) (5.1 ) (47.7 ) Current accident year non-cat loss and ALAE 97.5 59.4 66.3 33.6 21.9 7.4 286.1 Total non-cat loss and ALAE 100.3 52.5 51.6 11.8 19.9 2.3 238.4 Total Loss and ALAE 102.2 64.5 65.8 11.8 28.7 2.3 275.3 ULAE 7.6 4.7 2.8 2.4 1.7 0.3 19.5 Total Loss and LAE 109.8 69.2 68.6 14.2 30.4 2.6 294.8 Underwriting expenses 47.0 32.2 46.5 20.1 21.1 5.9 172.8 Net underwriting (loss) gain $ (22.2 ) $ (2.8 ) $ 7.5 $ 11.3 $ 1.8 $ 7.5 $ 3.1 Cat loss and ALAE ratio 1.4 % 12.2 % 11.6 % — % 16.5 % 0.1 % 7.8 % Non-cat loss and ALAE ratio Prior accident years non-cat loss and ALAE ratio 2.1 % (7.0 )% (12.0 )% (47.8 )% (3.7 )% (32.1 )% (10.1 )% Current accident year non-cat loss and ALAE ratio 72.4 % 60.2 % 54.1 % 73.8 % 41.1 % 46.1 % 60.8 % Total non-cat loss and ALAE ratio 74.5 % 53.2 % 42.1 % 26.0 % 37.4 % 14.0 % 50.7 % Total Loss and ALAE ratio 75.9 % 65.4 % 53.7 % 26.0 % 53.9 % 14.1 % 58.5 % ULAE ratio 5.6 % 4.7 % 2.3 % 5.2 % 3.1 % 1.7 % 4.1 % Total Loss and LAE ratio 81.5 % 70.1 % 56.0 % 31.2 % 57.0 % 15.8 % 62.6 % Expense ratio 29.3 % 31.1 % 34.7 % 41.4 % 34.7 % 33.5 % 32.9 % Combined ratio 110.8 % 101.2 % 90.7 % 72.6 % 91.7 % 49.3 % 95.5 % ($ in millions) Nine months ended September 30, 2020 Commercial Auto Small Commercial Package Middle Market Commercial Workers' Comp Farm & Ranch Other Commercial Total Net written premiums $ 117.8 $ 95.8 $ 126.8 $ 49.2 $ 47.3 $ 15.3 $ 452.2 Net earned premiums 96.2 92.8 116.0 54.4 40.8 14.5 414.7 Losses and LAE incurred: Cat loss and ALAE 1.1 21.0 35.7 — 8.7 0.2 66.7 Non-cat loss and ALAE Prior accident years non-cat loss and ALAE (1.5 ) (16.5 ) (14.3 ) (16.1 ) (1.7 ) (7.1 ) (57.2 ) Current accident year non-cat loss and ALAE 52.4 53.3 69.6 40.6 15.2 7.3 238.4 Total non-cat loss and ALAE 50.9 36.8 55.3 24.5 13.5 0.2 181.2 Total Loss and ALAE 52.0 57.8 91.0 24.5 22.2 0.4 247.9 ULAE 4.9 4.2 4.5 4.5 1.6 0.4 20.1 Total Loss and LAE 56.9 62.0 95.5 29.0 23.8 0.8 268.0 Underwriting expenses 40.1 34.0 50.8 22.7 21.1 6.0 174.7 Net underwriting (loss) gain $ (0.8 ) $ (3.2 ) $ (30.3 ) $ 2.7 $ (4.1 ) $ 7.7 $ (28.0 ) Cat loss and ALAE ratio 1.2 % 22.6 % 30.7 % — % 21.3 % 1.2 % 16.1 % Non-cat loss and ALAE ratio Prior accident years non-cat loss and ALAE ratio (1.5 )% (17.8 )% (12.3 )% (29.6 )% (4.1 )% (49.3 )% (13.8 )% Current accident year non-cat loss and ALAE ratio 54.3 % 57.5 % 60.1 % 74.6 % 37.3 % 50.7 % 57.4 % Total non-cat loss and ALAE ratio 52.8 % 39.7 % 47.8 % 45.0 % 33.2 % 1.4 % 43.6 % Total Loss and ALAE ratio 54.0 % 62.3 % 78.5 % 45.0 % 54.5 % 2.6 % 59.7 % ULAE ratio 5.1 % 4.5 % 3.9 % 8.4 % 3.9 % 2.6 % 4.9 % Total Loss and LAE ratio 59.1 % 66.8 % 82.4 % 53.4 % 58.4 % 5.2 % 64.6 % Expense ratio 34.1 % 35.5 % 40.0 % 46.2 % 44.6 % 39.3 % 38.6 % Combined ratio 93.2 % 102.3 % 122.4 % 99.6 % 103.0 % 44.5 % 103.2 % SAP Insurance Segment Results (unaudited) ($ in millions) 2021 2020 2021 2020 Three months ended September 30 Personal & Commercial Personal & Commercial Total(1) Total(1) Net written premiums $ 417.6 $ 379.0 $ 417.7 $ 379.1 Net earned premiums 381.6 353.2 381.8 353.2 Losses and LAE incurred: Cat loss and ALAE 39.5 46.4 39.4 58.7 Non-cat loss and ALAE Prior accident years non-cat loss and ALAE (4.9 ) (18.4 ) (5.0 ) (19.3 ) Current accident year non-cat loss and ALAE 230.9 194.1 231.1 194.3 Total non-cat loss and ALAE 226.0 175.7 226.1 175.0 Total Loss and ALAE 265.5 222.1 265.5 233.7 ULAE 21.3 19.6 21.4 18.3 Total Loss and LAE 286.8 241.7 286.9 252.0 Underwriting expenses 118.5 127.8 118.6 127.9 Net underwriting loss $ (23.7 ) $ (16.3 ) $ (23.7 ) $ (26.7 ) Cat loss and ALAE ratio 10.3 % 13.1 % 10.3 % 16.6 % Non-cat loss and ALAE ratio Prior accident years non-cat loss and ALAE ratio (1.3 )% (5.2 )% (1.3 )% (5.5 )% Current accident year non-cat loss and ALAE ratio 60.5 % 55.1 % 60.5 % 55.0 % Total non-cat loss and ALAE ratio 59.2 % 49.9 % 59.2 % 49.5 % Total Loss and ALAE ratio 69.5 % 63.0 % 69.5 % 66.1 % ULAE ratio 5.6 % 5.5 % 5.6 % 5.2 % Total Loss and LAE ratio 75.1 % 68.5 % 75.1 % 71.3 % Expense ratio 28.4 % 33.7 % 28.4 % 33.8 % Combined ratio 103.5 % 102.2 % 103.5 % 105.1 % (1)Includes specialty run-off (unaudited) ($ in millions) 2021 2020 2021 2020 Nine months ended September 30 Personal & Commercial Personal & Commercial Total(1) Total(1) Net written premiums $ 1,190.0 $ 1,107.3 $ 1,188.7 $ 1,107.2 Net earned premiums 1,108.8 1,024.4 1,107.6 1,024.4 Losses and LAE incurred: Cat loss and ALAE 192.8 178.6 191.0 191.0 Non-cat loss and ALAE Prior accident years non-cat loss and ALAE (45.3 ) (37.0 ) (45.5 ) (31.8 ) Current accident year non-cat loss and ALAE 656.6 542.1 656.8 542.4 Total non-cat loss and ALAE 611.3 505.1 611.3 510.6 Total Loss and ALAE 804.1 683.7 802.3 701.6 ULAE 64.2 62.9 64.2 61.6 Total Loss and LAE 868.3 746.6 866.5 763.2 Underwriting expenses 352.0 376.6 352.4 377.1 Net underwriting loss $ (111.5 ) $ (98.8 ) $ (111.3 ) $ (115.9 ) Cat loss and ALAE ratio 17.4 % 17.4 % 17.2 % 18.6 % Non-cat loss and ALAE ratio Prior accident years non-cat loss and ALAE ratio (4.1 )% (3.6 )% (4.1 )% (3.1 )% Current accident year non-cat loss and ALAE ratio 59.2 % 53.0 % 59.3 % 53.0 % Total non-cat loss and ALAE ratio 55.1 % 49.4 % 55.2 % 49.9 % Total Loss and ALAE ratio 72.5 % 66.8 % 72.4 % 68.5 % ULAE ratio 5.8 % 6.1 % 5.8 % 6.0 % Total Loss and LAE ratio 78.3 % 72.9 % 78.2 % 74.5 % Expense ratio 29.6 % 34.0 % 29.6 % 34.1 % Combined ratio 107.9 % 106.9 % 107.8 % 108.6 % (1)Includes specialty run-off The following table provides a reconciliation of our statutory underwriting results to GAAP consolidated (loss) income before federal income taxes for the three and nine months ended September 30, 2021 and 2020: ($ millions) 3Q 2021 3Q 2020 YTD 2021 YTD 2020 Segment (loss) income before federal income taxes: Insurance operations: Personal insurance SAP underwriting loss $ (21.0 ) $ (30.7 ) $ (114.6 ) $ (70.8 ) Commercial insurance SAP underwriting (loss) gain (2.7 ) 14.4 3.1 (28.0 ) Specialty run-off — (10.4 ) 0.2 (17.1 ) Total insurance operations (23.7 ) (26.7 ) (111.3 ) (115.9 ) Investment operations: Net investment income 17.0 17.9 52.3 54.5 Net investment (loss) gain (8.1 ) 20.0 56.8 (39.3 ) Total investment operations 8.9 37.9 109.1 15.2 All other segments income — — — 0.1 Reconciling items: GAAP adjustments 3.1 5.6 7.5 20.2 Interest expense on corporate debt (1.1 ) (1.1 ) (3.3 ) (3.6 ) Corporate expenses (12.9 ) (0.9 ) (17.9 ) (3.6 ) Total reconciling items (10.9 ) 3.6 (13.7 ) 13.0 Total consolidated (loss) income before federal income taxes $ (25.7 ) $ 14.8 $ (15.9 ) $ (87.6 )

State Auto Financial (STFC) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

COLUMBUS, Ohio--(BUSINESS WIRE)--State Auto Financial Corporation (NASDAQ:STFC) today announced the results of shareholder voting on its proposed merger agreement with Liberty Mutual Holding Company Inc. (LMHC). STFC shareholders voted overwhelmingly to adopt the proposed merger agreement with 99.5% of shares voted (including abstentions) in favor of the proposal to adopt the merger agreement. The deal is expected to close in 2022, pending State Automobile Mutual Insurance Company member approval, receipt of required regulatory approvals and other customary closing conditions. About State Auto Financial Corporation State Auto Financial Corporation, headquartered in Columbus, Ohio, is a super regional property and casualty insurance holding company. STFC stock is traded on the NASDAQ Global Select Market, which represents the top fourth of all NASDAQ listed companies. The insurance subsidiaries of State Auto Financial Corporation are part of the State Auto Group. The State Auto Group markets its insurance products throughout the United States, through independent insurance agencies, which include retail agencies and wholesale brokers. The State Auto Group is rated A- (Excellent) by the A.M. Best Company and includes State Automobile Mutual Insurance Company, State Auto Property & Casualty Insurance Company, State Auto Insurance Company of Ohio, State Auto Insurance Company of Wisconsin, Milbank Insurance Company, Meridian Security Insurance Company, Patrons Mutual Insurance Company of Connecticut, Rockhill Insurance Company, Plaza Insurance Company, American Compensation Insurance Company and Bloomington Compensation Insurance Company. Additional information on State Auto Financial Corporation and State Auto Group can be found online at http://www.StateAuto.com/STFC. Cautionary Notice Regarding Forward-Looking Statements Except for historical information, all other information in this press release consists of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, and related oral statements State Auto Financial Corporation (“STFC”) may make, are subject to risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. For example, (1) conditions to the closing of the transactions may not be satisfied; (2) regulatory approvals required for the transactions may not be obtained, or required regulatory approvals may delay the transactions or result in the imposition of conditions that could have a material adverse effect on Liberty Mutual Holding Company Inc.(“LMHC”), State Automobile Mutual Insurance Company (“SAM”) or STFC or cause the parties to abandon the transactions; (3) uncertainty as to the timing of completion of the transactions; (4) the business of LMHC, SAM or STFC may suffer as a result of uncertainty surrounding the transactions; (5) the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; (6) risks related to disruption of management’s attention from the ongoing business operations of LMHC, SAM or STFC due to the transactions; (7) the effect of the announcement of the transactions on the relationships of LMHC, SAM or STFC with its clients, operating results and business generally; (8) the outcome of any legal proceedings to the extent initiated against LMHC, SAM or STFC following the announcement of the proposed transaction; and (9) LMHC, SAM or STFC may be adversely affected by other economic, business, and/or competitive factors as well as management’s response to any of the aforementioned factors. The foregoing review of important factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included herein and elsewhere, including the risk factors included in STFC’s most recent Annual Report on Form 10-K, STFC’s most recent Quarterly Report on Form 10-Q, the definitive proxy statement filed by STFC with the Securities Exchange Commission (the “SEC”) on August 27, 2021, and other documents of STFC on file with the SEC. STFC undertakes no obligation to update or revise any forward-looking statements.

COLUMBUS, Ohio--(BUSINESS WIRE)--State Auto Financial Corporation announced the results of shareholder voting on its proposed merger agreement with Liberty Mutual Holding Company Inc.

COLUMBUS, Ohio--(BUSINESS WIRE)--Today the board of directors of State Auto Financial Corporation declared a regular quarterly cash dividend of $0.10 per share, payable Sept. 27, 2021

COLUMBUS, Ohio--(BUSINESS WIRE)--Today the board of directors of State Auto Financial Corporation (NASDAQ:STFC) declared a regular quarterly cash dividend of $0.10 per share, payable Sept. 27, 2021, to shareholders of record at the close of business on Sept. 15, 2021. This is the 121st consecutive quarterly cash dividend declared by the company's board since STFC had its initial public offering of common stock in 1991. About State Auto Financial Corporation State Auto Financial Corporation, headquartered in Columbus, Ohio, is a super regional property and casualty insurance holding company. STFC stock is traded on the NASDAQ Global Select Market, which represents the top fourth of all NASDAQ listed companies. The insurance subsidiaries of State Auto Financial Corporation are part of the State Auto Group. The State Auto Group markets its insurance products throughout the United States, through independent insurance agencies, which include retail agencies and wholesale brokers. The State Auto Group is rated A- (Excellent) by the A.M. Best Company and includes State Automobile Mutual, State Auto Property & Casualty, State Auto Ohio, State Auto Wisconsin, Milbank, Meridian Security, Patrons Mutual, Rockhill Insurance, Plaza Insurance, American Compensation and Bloomington Compensation. Additional information on State Auto Financial Corporation and the State Auto Insurance Companies can be found online at http://www.StateAuto.com/STFC.

Safety Insurance Group: Cheap Insurer With A Good Yield

State Auto Financial (STFC) delivered earnings and revenue surprises of -1275.00% and 0.16%, respectively, for the quarter ended June 2021. Do the numbers hold clues to what lies ahead for the stock?

COLUMBUS, Ohio--(BUSINESS WIRE)---- $STFC #STFC--State Auto Financial reports second quarter 2021 results