NI (US:NODK)2023-11-07 21:08Financial Performance - Consolidated net income for Q3 2023 was $298, a significant improvement from a net loss of $10,169 in Q3 2022[152]. - Total revenues for Q3 2023 increased to $92,749, up 1.4% from $89,175 in Q3 2022, and for the nine months ended September 30, 2023, revenues rose to $271,281, a 17.4% increase from $231,105 in the same period of 2022[152]. - The company recorded a pre-tax income of $128 for the three months ended September 30, 2023, compared to a pre-tax loss of $13,243 for the same period in 2022[178]. - The net income before non-controlling interest for the three months ended September 30, 2023, was $298 compared to a net loss of $10,169 for the same period in 2022[181]. - The annualized return on average equity for the three months ended September 30, 2023, was 0.4% compared to (15.4)% for the same period in 2022[182]. Premiums and Underwriting - Net premiums earned for Q3 2023 were $90,770, an increase of $1,238 or 1.4% compared to Q3 2022, and for the nine months ended September 30, 2023, net premiums earned rose to $262,543, up $18,928 or 7.8% from the same period in 2022[154]. - Private passenger auto net premiums earned increased by $1,422 or 7.2% in Q3 2023 compared to Q3 2022, driven by rate increases in specific states[155]. - Non-standard auto net premiums earned surged by $3,652 or 20.8% in Q3 2023, attributed to new business growth and significant rate increases in the Chicago market[156]. - Home and farm net premiums earned rose by $1,558 or 7.9% in Q3 2023, supported by rate increases and higher insured property values[157]. - Crop net premiums earned decreased by $4,820 or 33.1% in Q3 2023, driven by lower commodity prices and fewer acres insured[158]. - Commercial net premiums earned saw a slight decrease of $133 or 0.8% in Q3 2023, while year-to-date figures showed an increase of $3,307 or 7.3%[159]. Losses and Expenses - Losses and loss adjustment expenses for Q3 2023 decreased to $63,564, down $15,353 or 19.5% from $78,917 in Q3 2022, and for the nine months ended September 30, 2023, these expenses decreased to $199,895, down $27,746 or 12.2% from $227,641 in the same period of 2022[161]. - The loss and loss adjustment expenses ratio for Q3 2023 was 70.0%, a decrease from 88.1% in Q3 2022, indicating improved profitability[162]. - The net loss and loss adjustment expense ratio for the Commercial segment increased by 3.4 percentage points and 23.3 percentage points for the three- and nine-month periods ended September 30, 2023, respectively, compared to the same periods in 2022[166]. - The net loss and loss adjustment expense ratio for all other segments decreased by 44.1 percentage points and 40.1 percentage points for the three- and nine-month periods ended September 30, 2023, respectively, compared to the same period in 2022[167]. - Total underwriting loss decreased by $11,035, or 85.6%, for the three-month period and by $32,650, or 57.1%, for the nine-month period ended September 30, 2023, compared to the same periods in 2022[170]. - The overall combined ratio decreased by 12.4 percentage points for the three-month period and by 14.2 percentage points for the nine-month period ended September 30, 2023, compared to the same periods in 2022[171]. Investment Income - Net investment income increased by $716 for the three months and by $1,792 for the nine months ended September 30, 2023, compared to the same periods in 2022, driven by a rising interest rate environment[173]. - Net realized gains were $531 and $11,998 for the three and nine months ended September 30, 2023, respectively, compared to $83 and $2,048 for the same periods in 2022[175]. Cash Flow and Liquidity - For the nine months ended September 30, 2023, net cash used by operating activities totaled $3,021, a significant decrease from $24,680 in the same period of 2022, primarily due to lower claim payments and higher premium collections[186]. - Net cash used by investing activities for the same period was $2,021, compared to net cash provided of $18,639 a year ago, driven by decreased maturities and sales of fixed income securities[187]. - Net cash used by financing activities totaled $7,454 for the nine months ended September 30, 2023, down from $10,305 in the prior year, influenced by an installment payment related to Westminster and increased share repurchases[188]. - No dividends were declared or paid by Nodak Insurance during the nine months ended September 30, 2023, due to statutory net loss restrictions[192]. - Direct Auto and Westminster also did not declare or pay dividends during the nine months ended September 30, 2023, due to similar restrictions based on statutory net losses[193][194]. - The company expects to maintain a high degree of liquidity in its investment portfolio to meet claim settlements and operating expenses in the foreseeable future[186]. - The company's principal source of long-term liquidity will be dividend payments from directly-owned subsidiaries, which are currently restricted[189]. Market Risk - The assessment of market risk as of September 30, 2023, indicates no material changes from the previous year[196].