National General Holdings Corp. Reports Second Quarter 2020 Results

Rhea-AI Summary

National General Holdings Corp. (NGHC) reported a robust second quarter for 2020, achieving net income of $157.6 million or $1.37 per diluted share, a significant increase from $69.0 million or $0.60 per diluted share in Q2 2019. Operating earnings were also strong at $1.36 per diluted share. Gross written premiums grew 4.2% year-over-year to $1.24 billion, driven by both P&C and A&H segments. The combined ratio improved to 80.5%, down from 90.9% a year earlier. Stockholders’ equity rose to $3.0 billion, and a strategic agreement was announced for acquisition by Allstate at $34.50 per share.

Positive

• Net income increased by 128.3% year-over-year.
• Operating earnings rose to $1.36 per diluted share, a 102.9% increase.
• Gross written premium grew by $50.4 million to $1,243.2 million.
• Combined ratio improved to 80.5% from 90.9% in the prior year.
• Stockholders' equity increased by 13.0% to $3.0 billion.

Negative

• Net investment income decreased to $30.5 million from $35.9 million in Q2 2019.
• Significant catastrophe losses increased to $35.3 million from $18.4 million year-over-year.

NEW YORK, July 31, 2020 (GLOBE NEWSWIRE) -- National General Holdings Corp. (Nasdaq: NGHC) reported second quarter 2020 net income of $157.6 million or $1.37 per diluted share, compared to net income of $69.0 million or $0.60 per diluted share in the second quarter of 2019. Second quarter 2020 operating earnings (non-GAAP)⁽¹⁾ were $157.6 million or $1.36 per diluted share compared to $78.1 million or $0.67 per diluted share in the second quarter of 2019.

Second Quarter 2020 Highlights versus Second Quarter 2019*

• Gross written premium grew by $50.4 million to $1,243.2 million compared to the prior year’s quarter due to our P&C segment growth of 3.2%, driven by the acquisition of National Farmers Union Property and Casualty Company (“Farmers Union Insurance”) in the third quarter of 2019, and organic growth, largely offset by the premium refund provided due to lower miles driven as a result of the COVID-19 pandemic; and our A&H domestic segment growth of 20.2%, excluding our previously sold A&H international business.
  
  
• The overall combined ratio^(11,12) was 80.5% compared to 90.9% in the prior year’s quarter, excluding non-cash amortization of intangible assets. The P&C segment reported an improved combined ratio to 83.6% from 92.6% in the prior year’s quarter driven by our continued strong underwriting and recent declines in miles driven. The P&C combined ratio includes prior year unfavorable loss development of $8.6 million compared to $10.4 million unfavorable loss development in the prior year’s quarter, and $35.3 million of catastrophe losses related to weather-related events compared to $18.4 million of catastrophe losses in the prior year’s quarter. The A&H segment reported a decrease in the combined ratio to 65.0% from 82.6% in the prior year’s quarter, driven by strong operating results in our small group self-funded and individual products, absence of our international business which was sold in the fourth quarter of 2019, and growth in service and fee income of 51.3%. The A&H combined ratio includes $11.4 million of favorable loss development compared to $8.1 million of favorable loss development in the prior year’s quarter.
  
  
• Stockholders’ equity was $3.0 billion and fully diluted book value per share was $22.02 at June 30, 2020, growth of 13.0% and 15.5%, respectively, from December 31, 2019. Excluding accumulated other comprehensive income, fully diluted book value per share was $20.40 at June 30, 2020, growth of 10.7%, from December 31, 2019. Our trailing twelve-month operating return on average equity (ROE)⁽¹³⁾ was 18.1% as of June 30, 2020.
  
  
• Second quarter of 2020 operating earnings (non-GAAP)⁽¹⁾ excludes the following, net of tax: $0.1 million loss on equity method investments, $4.4 million or $0.04 per share of net gain on investments and $4.2 million or $0.04 per share of non-cash amortization of intangible assets.
  
  
• Repurchased 459,083 shares during the second quarter of 2020 as part of our share repurchase program.
  
  
• Agreement announced on July 7, 2020 to be acquired by Allstate for expected total consideration of $34.50 per share cash (consisting of $32.00 in cash and an up to $2.50 per share closing dividend), subject to shareholder and regulatory approval and other customary closing conditions.

Barry Karfunkel, National General’s CEO, stated: “Our well diversified platform continues to perform well. With our recently announced agreement to be acquired by Allstate, we look forward to contributing to the greater Allstate. I want to personally thank each and every one of the National General team members for their outstanding and continued work during these unprecedented times and for their continuing contribution to the success of the pending acquisition.”

*NOTE: Unless specified otherwise, discussion of our second quarter 2020 and 2019 results do not include financial results from the Reciprocal Exchanges, which are presented within our consolidated financial results within this release but are not included in net income available to NGHC common stockholders.

Overview of Second Quarter 2020 as Compared to Second Quarter 2019

• Property & Casualty - Gross written premium grew by 3.2% to $1,053.5 million, net written premium increased by 0.4% to $789.4 million, and net earned premium increased by 2.9% to $842.0 million. P&C gross written premium growth was driven by $47.7 million of added premiums from the acquisition of Farmers Union Insurance, and organic growth, largely offset by the premium refund provided due to lower miles driven as a result of the COVID-19 pandemic. Service and fee income was $112.0 million compared to $113.1 million in the prior year’s quarter. Excluding non-cash amortization of intangible assets, the combined ratio^(11,12) was 83.6% with a loss and LAE ratio of 59.8% and an expense ratio^(10,12) of 23.8%, versus a prior year combined ratio of 92.6% with a loss and LAE ratio of 72.6% and an expense ratio of 20.0%. The loss and LAE ratio was impacted by pre-tax catastrophe losses of approximately $35.3 million primarily related to weather-related events in the second quarter of 2020, compared to $18.4 million of losses in the second quarter of 2019. Unfavorable loss development was $8.6 million in the second quarter of 2020 primarily driven by small business auto, compared to unfavorable loss development of $10.4 million in the second quarter of 2019.
   
• Accident & Health - Gross written premium grew by $18.0 million compared to the prior year’s quarter due to growth in both our small group self-funded and individual products. Excluding our A&H international business, our A&H domestic segment grew by 20.2% to $189.7 million. Service and fee income grew 51.3% to $80.1 million compared to $52.9 million in the prior year’s quarter. Excluding non-cash amortization of intangible assets, the combined ratio^(11,12) was 65.0% with a loss and LAE ratio of 39.5% and an expense ratio^(10,12) of 25.5%, versus a prior year combined ratio of 82.6% with a loss and LAE ratio of 52.0% and an expense ratio of 30.6%. The loss and LAE ratio reflects strong performance in both small group self-funded and individual products. Favorable loss development was $11.4 million in the second quarter of 2020, compared to favorable loss development of $8.1 million in the second quarter of 2019.
   
• Reciprocal Exchanges - Results for the Reciprocal Exchanges are not included in net income available to NGHC common stockholders. Gross written premium was $98.4 million, net written premium was $57.3 million, and net earned premium was $54.8 million. Reciprocal Exchanges combined ratio^(11,12) excluding non-cash amortization of intangible assets was 83.1% with a loss and LAE ratio of 54.8% and an expense ratio^(10,12) of 28.3%.

Second quarter of 2020 net investment income decreased to $30.5 million, compared to $35.9 million in the second quarter of 2019. Total investments and cash and cash equivalents (including restricted cash) were $5.2 billion as of June 30, 2020. Accumulated other comprehensive income increased to a $186.9 million gain at June 30, 2020, from a $74.5 million gain at December 31, 2019, primarily due to market improvement.

Interest expense was $11.8 million, down from $12.9 million in the prior year’s quarter. Debt was $682.3 million at June 30, 2020, compared to $686.0 million at December 31, 2019.

The second quarter of 2020 provision for income taxes was $49.0 million and the effective tax rate for the quarter was 22.7% compared with income taxes of $22.3 million and an effective rate of 22.2% in the second quarter of 2019.

Stockholders’ equity was $2,995.1 million at June 30, 2020, growth of 13.0% from $2,649.5 million at December 31, 2019. Fully diluted book value per share was $22.02 at June 30, 2020, growth of 15.5% from $19.06 at December 31, 2019. Excluding accumulated other comprehensive income, fully diluted book value per share was $20.40 at June 30, 2020, growth of 10.7%, from December 31, 2019. Our trailing twelve-month operating return on average equity (ROE)⁽¹³⁾ was 18.1% as of June 30, 2020.

Year-to-Date P&C Segment Notable Large Losses
Year		Quarter		Event		P&C Notable Large Losses and LAE ($ millions)			P&C Loss and LAE Ratio Points*			EPS Impact After Tax
2020		Q2		Weather-related Events		$35.3			4.2%			$0.24
2020		Q1		Weather-related Events		$8.1			0.9%			$0.06
2019		Q2		Weather-related Events		$18.4			2.2%			$0.13
2019		Q1		Winter Weather		$12.1			1.6%			$0.08

* Loss and LAE ratio points related to P&C net earned premium in quarter the loss event was recorded.

Additional item -

Homeowners Quota Share - Effective July 1, 2020, we cede 20.0% of net liability and receive a 37.0% ceding commission on in-force, new and renewal business, under our homeowners quota share reinsurance agreement.

About National General Holdings Corp.

National General Holdings Corp. (NASDAQ: NGHC), headquartered in New York City, is a specialty personal lines insurance holding company. National General traces its roots to 1939, has a financial strength rating of A- (excellent) from A.M. Best, and provides personal and commercial automobile, homeowners, umbrella, recreational vehicle, motorcycle, lender-placed, supplemental health and other niche insurance products.

IMPORTANT INFORMATION FOR INVESTORS

Additional Information and Where to Find It

This communication may be deemed solicitation material in respect of the proposed acquisition of National General Holdings Corp. (the “Company”) by The Allstate Corporation. In connection with the merger, the Company plans to file with the Securities and Exchange Commission and furnish its stockholders a proxy statement. Additionally, the Company will file other relevant materials with the Securities and Exchange Commission in connection with the proposed transaction.

The materials to be filed by the Company with the Securities and Exchange Commission may be obtained free of charge at the Securities and Exchange Commission’s web site at www.sec.gov. In addition, stockholders also may obtain free copies of the proxy statement, when available, from the Company by contacting National General Holdings Corp. Investor Relations at 59 Maiden Lane, 38th Floor New York, New York 10038, telephone number (212) 380-9462 or InvestorRelations@ngic.com.

INVESTORS AND STOCKHOLDERS OF THE COMPANY ARE URGED TO READ THE PROXY STATEMENT AND THE OTHER RELEVANT MATERIALS WHEN THEY BECOME AVAILABLE BEFORE MAKING ANY VOTING OR INVESTMENT DECISION WITH RESPECT TO THE PROPOSED MERGER BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE MERGER AND THE PARTIES TO THE MERGER.

Participants in the Solicitation

The Company and its directors, executive officers and other members of management and employees, under the Securities and Exchange Commission rules, may be deemed to be participants in the solicitation of proxies of the Company’s stockholders in connection with the proposed merger. Investors and security holders may obtain more detailed information regarding the names, affiliations and interests of certain of the Company’s executive officers and directors in the solicitation by reading the Company’s proxy statement for its 2020 annual meeting of stockholders and the proxy statement and other relevant materials which may be filed with the Securities and Exchange Commission in connection with the merger when and if they become available. Information concerning the interests of the Company’s participants in the solicitation, which may, in some cases, be different than those of the Company’s stockholders generally, will be set forth in the proxy statement relating to the merger when and if it becomes available. Additional information regarding the Company’s executive officers and directors in the solicitation is available by reading the Company’s proxy statement for its 2020 annual meeting of stockholders.

Forward Looking Statements

This news release contains “forward-looking statements” that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements are based on the Company’s current expectations and beliefs concerning future developments and their potential effects on the Company. Forward-looking statements can generally be identified by the use of forward-looking terminology, such as “may,” “will,” “plan,” “expect,” “project,” “intend,” “estimate,” “anticipate” and “believe” or their variations or similar terminology. There can be no assurance that actual developments will be those anticipated by us. Actual results may differ materially from those expressed or implied in these statements as a result of significant risks and uncertainties, including, but not limited to, plans and expectations related to our proposed merger with The Allstate Corporation (“Allstate”), including anticipated timing for closing of the merger, the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement with Allstate, the inability to complete the proposed merger due to the failure to obtain stockholder approval for the proposed merger or the failure to satisfy other conditions to completion of the proposed merger, the possibility that competing offers will be made, non-receipt of expected payments from insureds or reinsurers, changes in interest rates, a downgrade in the financial strength ratings of our insurance subsidiaries, the potential effect of changes in LIBOR reporting practices, the effects of pandemics or other widespread health problems such as the ongoing COVID-19 pandemic on our business, including our investment portfolio, and the national and global economy generally, the effect of the performance of financial markets on our investment portfolio, our ability to accurately underwrite and price our products and to maintain and establish accurate loss reserves, estimates of the fair value of investments, development of claims and the effect on loss reserves, large loss activity including hurricanes and wildfires, the cost and availability of reinsurance coverage, the effects of emerging claim and coverage issues, the effect of unpredictable catastrophic losses, changes in the demand for our products, our degree of success in integrating acquired businesses, the effect of general economic conditions, state and federal legislation, the effects of tax reform, regulations and regulatory investigations into industry practices, risks associated with conducting business outside the United States, developments relating to existing agreements, disruptions to our business relationships with third party vendors or agencies, breaches in data security or other disruptions involving our technology, heightened competition, changes in pricing environments, and changes in asset valuations. The forward-looking statements contained in this news release are made only as of the date of this release. The Company undertakes no obligation to publicly update any forward-looking statement except as may be required by law. Additional information about these risks and uncertainties, as well as others that may cause actual results to differ materially from those projected, is contained in the Company’s filings with the Securities and Exchange Commission.

Income Statement - Second Quarter
$ in thousands
(Unaudited)

		Three Months Ended June 30,
		2020													2019
		NGHC				Reciprocal Exchanges				Consolidated					NGHC				Reciprocal Exchanges				Consolidated
Revenues:
Gross written premium		$	1,243,165			$	98,436			$	1,341,601				$	1,192,762			$	121,146			$	1,313,908
Net written premium		957,640				57,268				1,014,908					939,178				56,220				995,398
Net earned premium		1,010,782				54,785				1,065,567					984,021				46,630				1,030,651
Ceding commission income		35,530				11,110				46,640					43,346				16,846				60,192
Service and fee income		192,023				2,336				180,592			(A)		166,049				1,516				148,908			(G)
Net investment income		30,523				2,012				31,175			(B)		35,949				2,124				35,131			(H)
Net gain (loss) on investments		5,511				(353		)		5,158					(5,274		)		44				(5,230		)
Total revenues		$	1,274,369			$	69,890			$	1,329,132		(C)		$	1,224,091			$	67,160			$	1,269,652		(I)
Expenses:
Loss and loss adjustment expense		$	570,439			$	30,007			$	600,446				$	680,246			$	35,289			$	715,535
Acquisition costs and other underwriting expenses		219,278				10,100				229,378					185,951				8,175				194,126
General and administrative expenses		257,318				18,858				262,409			(D)		244,827				21,597				247,767			(J)
Interest expense		11,779				1,360				11,779			(E)		12,925				2,942				12,925			(K)
Total expenses		$	1,058,814			$	60,325			$	1,104,012		(F)		$	1,123,949			$	68,003			$	1,170,353		(L)
Income (loss) before provision (benefit) for income taxes		$	215,555			$	9,565			$	225,120				$	100,142			$	(843	)		$	99,299
Provision (benefit) for income taxes		48,981				1,526				50,507					22,266				(25		)		22,241
Net income (loss) before non-controlling interest and dividends on preferred shares		166,574				8,039				174,613					77,876				(818		)		77,058
Less: net income (loss) attributable to noncontrolling interest		—				8,039				8,039					—				(818		)		(818		)
Net income before dividends on preferred shares		166,574				—				166,574					77,876				—				77,876
Less: dividends on preferred shares		8,925				—				8,925					8,925				—				8,925
Net income available to common stockholders		$	157,649			$	—			$	157,649				$	68,951			$	—			$	68,951

NOTES: Consolidated column includes eliminations as follows: (A) $(13,767), (B) $(1,360), (C) $(15,127), (D) $(13,767), (E) $(1,360), (F) $(15,127), (G) $(18,657), (H) $(2,942), (I) $(21,599), (J) $(18,657), (K) $(2,942) and (L) $(21,599).

Income Statement - Year To Date
$ in thousands
(Unaudited)

		Six Months Ended June 30,
		2020													2019
		NGHC				Reciprocal Exchanges				Consolidated					NGHC				Reciprocal Exchanges				Consolidated
Revenues:
Gross written premium		$	2,627,866			$	190,289			$	2,818,155				$	2,596,971			$	226,715			$	2,823,686
Net written premium		2,111,948				112,563				2,224,511					2,054,887				105,175				2,160,062
Net earned premium		2,028,390				112,383				2,140,773					1,902,520				92,288				1,994,808
Ceding commission income		72,121				24,824				96,945					94,346				35,380				129,726
Service and fee income		383,180				3,493				360,033			(A)		346,437				2,886				314,415			(G)
Net investment income		60,270				4,195				61,418			(B)		70,232				4,294				68,576			(H)
Net gain (loss) on investments		(557		)		(1,146		)		(1,703		)			(4,508		)		(700		)		(5,208		)
Total revenues		$	2,543,404			$	143,749			$	2,657,466		(C)		$	2,409,027			$	134,148			$	2,502,317		(I)
Expenses:
Loss and loss adjustment expense		$	1,220,070			$	72,374			$	1,292,444				$	1,290,030			$	77,314			$	1,367,344
Acquisition costs and other underwriting expenses		437,023				20,597				457,620					389,284				16,760				406,044
General and administrative expenses		518,197				38,421				529,978			(D)		487,660				43,109				495,861			(J)
Interest expense		23,559				3,047				23,559			(E)		25,924				5,950				25,924			(K)
Total expenses		$	2,198,849			$	134,439			$	2,303,601		(F)		$	2,192,898			$	143,133			$	2,295,173		(L)
Income (loss) before provision (benefit) for income taxes		$	344,555			$	9,310			$	353,865				$	216,129			$	(8,985	)		$	207,144
Provision (benefit) for income taxes		77,222				1,457				78,679					46,495				(1,748		)		44,747
Net income (loss) before non-controlling interest and dividends on preferred shares		267,333				7,853				275,186					169,634				(7,237		)		162,397
Less: net income (loss) attributable to noncontrolling interest		—				7,853				7,853					—				(7,237		)		(7,237		)
Net income before dividends on preferred shares		267,333				—				267,333					169,634				—				169,634
Less: dividends on preferred shares		16,800				—				16,800					16,800				—				16,800
Net income available to common stockholders		$	250,533			$	—			$	250,533				$	152,834			$	—			$	152,834

NOTES: Consolidated column includes eliminations as follows: (A) $(26,640), (B) $(3,047), (C) $(29,687), (D) $(26,640), (E) $(3,047), (F) $(29,687) (G) $(34,908), (H) $(5,950), (I) $(40,858), (J) $(34,908), (K) $(5,950) and (L) $(40,858).

Earnings and Per Share Data
$ in thousands, except shares and per share data
(Unaudited)

	Three Months Ended June 30,								Six Months Ended June 30,
	2020				2019				2020				2019
Net income available to common stockholders	$	157,649			$	68,951			$	250,533			$	152,834
Basic net income per common share	$	1.39			$	0.61			$	2.21			$	1.35
Diluted net income per common share	$	1.37			$	0.60			$	2.17			$	1.33
Operating earnings attributable to NGHC (non-GAAP)(1)	$	157,643			$	78,140			$	263,402			$	167,856
Basic operating earnings per common share (non-GAAP)(1)	$	1.39			$	0.69			$	2.32			$	1.48
Diluted operating earnings per common share (non-GAAP)(1)	$	1.36			$	0.67			$	2.27			$	1.45
Dividends declared per common share	$	0.05			$	0.04			$	0.10			$	0.08
Weighted average number of basic shares outstanding	113,542,628				113,178,552				113,549,952				113,097,084
Weighted average number of diluted shares outstanding	115,720,069				116,050,267				115,898,110				116,062,721
Shares outstanding, end of period	113,397,545				113,215,632
Fully diluted shares outstanding, end of period	115,574,986				116,087,347
Book value per share	$	22.44			$	17.92
Fully diluted book value per share	$	22.02			$	17.48

Reconciliation of Net Income to Operating Earnings (Non-GAAP)^(1)(13)
$ in thousands, except per share data
(Unaudited)

	Three Months Ended June 30,								Six Months Ended June 30,
	2020				2019				2020				2019
Net income available to common stockholders	$	157,649			$	68,951			$	250,533			$	152,834
Add (subtract):
Equity in (earnings) losses of equity method investments	160				(731		)		3,888				203
Net (gain) loss on investments	(5,511		)		5,274				557				4,508
Non-cash amortization of intangible assets	5,343				7,089				11,845				14,305
Income tax expense (benefit)	2				(2,443		)		(3,421		)		(3,994		)
Operating earnings attributable to NGHC (non-GAAP)(1)	$	157,643			$	78,140			$	263,402			$	167,856
Operating earnings per common share (non-GAAP)(1):
Basic operating earnings per common share (non-GAAP)(1)	$	1.39			$	0.69			$	2.32			$	1.48
Diluted operating earnings per common share (non-GAAP)(1)	$	1.36			$	0.67			$	2.27			$	1.45

Balance Sheet
$ in thousands
(Unaudited)

		June 30, 2020													December 31, 2019
ASSETS		NGHC				Reciprocal Exchanges				Consolidated					NGHC				Reciprocal Exchanges				Consolidated
Total investments (2)		$	4,853,180			$	340,103			$	5,085,750		(A)		$	4,632,960			$	329,494			$	4,854,998		(H)
Cash and cash equivalents, including restricted cash		334,771				237				335,008					163,480				983				164,463
Premiums and other receivables, net		1,438,085				49,649				1,487,734					1,373,089				55,859				1,428,948
Reinsurance balances		1,614,713				196,005				1,810,718					1,745,036				225,019				1,970,055
Intangible assets, net		347,686				3,135				350,821					362,598				3,225				365,823
Goodwill		179,328				—				179,328					179,328				—				179,328
Other (3)		776,916				29,364				768,484			(B)		798,675				29,070				792,919			(I)
Total assets		$	9,544,679			$	618,493			$	10,017,843		(C)		$	9,255,166			$	643,650			$	9,756,534		(J)
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Unpaid loss and loss adjustment expense reserves		$	2,626,314			$	200,270			$	2,826,584				$	2,680,628			$	205,786			$	2,886,414
Unearned premiums and other revenue		2,102,044				226,403				2,328,447					2,059,688				252,553				2,312,241
Reinsurance payable		437,989				23,907				461,896					527,155				35,689				562,844
Accounts payable and accrued expenses		320,176				45,549				327,929			(D)		306,869				43,323				315,366			(K)
Debt		682,266				107,533				682,266			(E)		686,006				107,456				686,006			(L)
Other		380,766				30,279				411,045					345,366				30,803				376,169
Total liabilities		$	6,549,555			$	633,941			$	7,038,167		(F)		$	6,605,712			$	675,610			$	7,139,040		(M)
Stockholders’ equity:
Preferred stock (4)		$	450,000			$	—			$	450,000				$	450,000			$	—			$	450,000
Common stock (5)		1,139				—				1,139					1,134				—				1,134
Treasury stock, at cost (6)		(8,482		)		—				(8,482		)			—				—				—
Additional paid-in capital		1,069,152				—				1,069,152					1,065,634				—				1,065,634
Accumulated other comprehensive income		186,864				—				186,864					74,548				—				74,548
Retained earnings		1,296,451				—				1,296,451					1,058,138				—				1,058,138
Total National General Holdings Corp. stockholders’ equity		2,995,124				—				2,995,124					2,649,454				—				2,649,454
Noncontrolling interest		—				(15,448		)		(15,448		)			—				(31,960		)		(31,960		)
Total stockholders’ equity		$	2,995,124			$	(15,448	)		$	2,979,676				$	2,649,454			$	(31,960	)		$	2,617,494
Total liabilities and stockholders’ equity		$	9,544,679			$	618,493			$	10,017,843		(G)		$	9,255,166			$	643,650			$	9,756,534		(N)

NOTES: Consolidated column includes eliminations as follows: (A) $(107,533), (B) $(37,796), (C) $(145,329), (D) $(37,796), (E) $(107,533), (F) $(145,329), (G) $(145,329) (H) $(107,456), (I) $(34,826), (J) $(142,282), (K) $(34,826), (L) $(107,456), (M) $(142,282) and (N) $(142,282).

Segment Information - Second Quarter
$ in thousands
(Unaudited)

		Three Months Ended June 30,
		2020																		2019
		P&C				A&H				NGHC					Reciprocal Exchanges					P&C				A&H				NGHC					Reciprocal Exchanges
Gross written premium		$	1,053,508			$	189,657			$	1,243,165				$	98,436				$	1,021,090			$	171,672			$	1,192,762				$	121,146
Net written premium		789,428				168,212				957,640					57,268					786,471				152,707				939,178					56,220
Net earned premium		841,985				168,797				1,010,782					54,785					817,972				166,049				984,021					46,630
Ceding commission income		35,059				471				35,530					11,110					39,418				3,928				43,346					16,846
Service and fee income		111,955				80,068				192,023					2,336					113,112				52,937				166,049					1,516
Total underwriting revenues		$	988,999			$	249,336			$	1,238,335				$	68,231				$	970,502			$	222,914			$	1,193,416				$	64,992
Loss and loss adjustment expense (A)		503,784				66,655				570,439					30,007					593,922				86,324				680,246					35,289
Acquisition costs and other underwriting expenses		152,384				66,894				219,278					10,100					137,950				48,001				185,951					8,175
General and administrative expenses		199,327				57,991				257,318					18,858					183,535				61,292				244,827					21,597
Total underwriting expenses		$	855,495			$	191,540			$	1,047,035				$	58,965				$	915,407			$	195,617			$	1,111,024				$	65,061
Underwriting income (loss)		133,504				57,796				191,300					9,266					55,095				27,297				82,392					(69		)
Non-cash amortization of intangible assets		4,041				1,302				5,343					30					5,412				1,677				7,089					12
Underwriting income (loss) before amortization and impairment		$	137,545			$	59,098			$	196,643				$	9,296				$	60,507			$	28,974			$	89,481				$	(57	)
Underwriting ratios
Loss and loss adjustment expense ratio (7)		59.8		%		39.5		%		56.4		%			54.8		%			72.6		%		52.0		%		69.1		%			75.7		%
Operating expense ratio (Non-GAAP) (8)		24.3		%		26.3		%		24.6		%			28.3		%			20.7		%		31.6		%		22.5		%			24.5		%
Combined ratio (Non-GAAP) (9)		84.1		%		65.8		%		81.0		%			83.1		%			93.3		%		83.6		%		91.6		%			100.2		%
Underwriting ratios (before amortization and impairment)
Loss and loss adjustment expense ratio (7)		59.8		%		39.5		%		56.4		%			54.8		%			72.6		%		52.0		%		69.1		%			75.7		%
Operating expense ratio (Non-GAAP) (10)		23.8		%		25.5		%		24.1		%			28.3		%			20.0		%		30.6		%		21.8		%			24.4		%
Combined ratio before amortization and impairment (Non-GAAP) (11)		83.6		%		65.0		%		80.5		%			83.1		%			92.6		%		82.6		%		90.9		%			100.1		%

(A) Loss and loss adjustment expenses for the three months ended June 30, 2020 included $8,584 of unfavorable loss development on prior accident year loss and loss adjustment expense reserves in the P&C segment, and $11,430 of favorable loss development in the A&H segment, versus $10,396 of unfavorable loss development in the P&C segment, and $8,135 of favorable loss development in the A&H segment for the three months ended June 30, 2019.

Segment Information - Year To Date
$ in thousands
(Unaudited)

		Six Months Ended June 30,
		2020																		2019
		P&C				A&H				NGHC					Reciprocal Exchanges					P&C				A&H				NGHC					Reciprocal Exchanges
Gross written premium		$	2,251,184			$	376,682			$	2,627,866				$	190,289				$	2,166,755			$	430,216			$	2,596,971				$	226,715
Net written premium		1,775,520				336,428				2,111,948					112,563					1,701,999				352,888				2,054,887					105,175
Net earned premium		1,694,887				333,503				2,028,390					112,383					1,574,891				327,629				1,902,520					92,288
Ceding commission income		71,090				1,031				72,121					24,824					87,827				6,519				94,346					35,380
Service and fee income		222,588				160,592				383,180					3,493					232,488				113,949				346,437					2,886
Total underwriting revenues		$	1,988,565			$	495,126			$	2,483,691				$	140,700				$	1,895,206			$	448,097			$	2,343,303				$	130,554
Loss and loss adjustment expense (A)		1,071,814				148,256				1,220,070					72,374					1,118,957				171,073				1,290,030					77,314
Acquisition costs and other underwriting expenses		301,658				135,365				437,023					20,597					283,435				105,849				389,284					16,760
General and administrative expenses		400,454				117,743				518,197					38,421					367,730				119,930				487,660					43,109
Total underwriting expenses		$	1,773,926			$	401,364			$	2,175,290				$	131,392				$	1,770,122			$	396,852			$	2,166,974				$	137,183
Underwriting income (loss)		214,639				93,762				308,401					9,308					125,084				51,245				176,329					(6,629		)
Non-cash amortization of intangible assets		9,228				2,617				11,845					60					10,897				3,408				14,305					23
Underwriting income (loss) before amortization and impairment		$	223,867			$	96,379			$	320,246				$	9,368				$	135,981			$	54,653			$	190,634				$	(6,606	)
Underwriting ratios
Loss and loss adjustment expense ratio (7)		63.2		%		44.5		%		60.1		%			64.4		%			71.0		%		52.2		%		67.8		%			83.8		%
Operating expense ratio (Non-GAAP) (8)		24.1		%		27.4		%		24.6		%			27.3		%			21.0		%		32.1		%		22.9		%			23.4		%
Combined ratio (Non-GAAP) (9)		87.3		%		71.9		%		84.7		%			91.7		%			92.0		%		84.3		%		90.7		%			107.2		%
Underwriting ratios (before amortization and impairment)
Loss and loss adjustment expense ratio (7)		63.2		%		44.5		%		60.1		%			64.4		%			71.0		%		52.2		%		67.8		%			83.8		%
Operating expense ratio (Non-GAAP) (10)		23.6		%		26.6		%		24.1		%			27.3		%			20.3		%		31.1		%		22.2		%			23.4		%
Combined ratio before amortization and impairment (Non-GAAP) (11)		86.8		%		71.1		%		84.2		%			91.7		%			91.3		%		83.3		%		90.0		%			107.2		%

(A) Loss and loss adjustment expenses for the six months ended June 30, 2020 included $13,055 of unfavorable loss development on prior accident year loss and loss adjustment expense reserves in the P&C segment, and $16,238 of favorable loss development in the A&H segment, versus $4,882 of unfavorable loss development in the P&C segment, and $18,987 of favorable loss development in the A&H segment for the six months ended June 30, 2019.

Reconciliation of Operating Expense Ratio (Non-GAAP)^(8,10,12)
$ in thousands
(Unaudited)

		Three Months Ended June 30,
		2020																		2019
		P&C				A&H				NGHC					Reciprocal Exchanges					P&C				A&H				NGHC					Reciprocal Exchanges
Total underwriting expenses		$	855,495			$	191,540			$	1,047,035				$	58,965				$	915,407			$	195,617			$	1,111,024				$	65,061
Less: Loss and loss adjustment expense		503,784				66,655				570,439					30,007					593,922				86,324				680,246					35,289
Less: Ceding commission income		35,059				471				35,530					11,110					39,418				3,928				43,346					16,846
Less: Service and fee income		111,955				80,068				192,023					2,336					113,112				52,937				166,049					1,516
Operating expense (Non-GAAP) (8)		204,697				44,346				249,043					15,512					168,955				52,428				221,383					11,410
Net earned premium		$	841,985			$	168,797			$	1,010,782				$	54,785				$	817,972			$	166,049			$	984,021				$	46,630
Operating expense ratio (Non-GAAP) (8)		24.3		%		26.3		%		24.6		%			28.3		%			20.7		%		31.6		%		22.5		%			24.5		%
Total underwriting expenses		$	855,495			$	191,540			$	1,047,035				$	58,965				$	915,407			$	195,617			$	1,111,024				$	65,061
Less: Loss and loss adjustment expense		503,784				66,655				570,439					30,007					593,922				86,324				680,246					35,289
Less: Ceding commission income		35,059				471				35,530					11,110					39,418				3,928				43,346					16,846
Less: Service and fee income		111,955				80,068				192,023					2,336					113,112				52,937				166,049					1,516
Less: Non-cash amortization of intangible assets		4,041				1,302				5,343					30					5,412				1,677				7,089					12
Operating expense before amortization and impairment (Non-GAAP) (10)		200,656				43,044				243,700					15,482					163,543				50,751				214,294					11,398
Net earned premium		$	841,985			$	168,797			$	1,010,782				$	54,785				$	817,972			$	166,049			$	984,021				$	46,630
Operating expense ratio before amortization and impairment (Non-GAAP) (10)		23.8		%		25.5		%		24.1		%			28.3		%			20.0		%		30.6		%		21.8		%			24.4		%

Reconciliation of Operating Expense Ratio (Non-GAAP)^(8,10,12)
$ in thousands
(Unaudited)

		Six Months Ended June 30,
		2020																		2019
		P&C				A&H				NGHC					Reciprocal Exchanges					P&C				A&H				NGHC					Reciprocal Exchanges
Total underwriting expenses		$	1,773,926			$	401,364			$	2,175,290				$	131,392				$	1,770,122			$	396,852			$	2,166,974				$	137,183
Less: Loss and loss adjustment expense		1,071,814				148,256				1,220,070					72,374					1,118,957				171,073				1,290,030					77,314
Less: Ceding commission income		71,090				1,031				72,121					24,824					87,827				6,519				94,346					35,380
Less: Service and fee income		222,588				160,592				383,180					3,493					232,488				113,949				346,437					2,886
Operating expense (Non-GAAP) (8)		408,434				91,485				499,919					30,701					330,850				105,311				436,161					21,603
Net earned premium		$	1,694,887			$	333,503			$	2,028,390				$	112,383				$	1,574,891			$	327,629			$	1,902,520				$	92,288
Operating expense ratio (Non-GAAP) (8)		24.1		%		27.4		%		24.6		%			27.3		%			21.0		%		32.1		%		22.9		%			23.4		%
Total underwriting expenses		$	1,773,926			$	401,364			$	2,175,290				$	131,392				$	1,770,122			$	396,852			$	2,166,974				$	137,183
Less: Loss and loss adjustment expense		1,071,814				148,256				1,220,070					72,374					1,118,957				171,073				1,290,030					77,314
Less: Ceding commission income		71,090				1,031				72,121					24,824					87,827				6,519				94,346					35,380
Less: Service and fee income		222,588				160,592				383,180					3,493					232,488				113,949				346,437					2,886
Less: Non-cash amortization of intangible assets		9,228				2,617				11,845					60					10,897				3,408				14,305					23
Operating expense before amortization and impairment (Non-GAAP) (10)		399,206				88,868				488,074					30,641					319,953				101,903				421,856					21,580
Net earned premium		$	1,694,887			$	333,503			$	2,028,390				$	112,383				$	1,574,891			$	327,629			$	1,902,520				$	92,288
Operating expense ratio before amortization and impairment (Non-GAAP) (10)		23.6		%		26.6		%		24.1		%			27.3		%			20.3		%		31.1		%		22.2		%			23.4		%

Premiums by Product Line
$ in thousands
(Unaudited)

	Three Months Ended June 30,
	Gross Written Premium												Net Written Premium												Net Earned Premium
	2020				2019				Change				2020				2019				Change				2020				2019				Change
Property & Casualty
Personal Auto	$	612,927			$	611,312			0.3	%			$	533,242			$	511,952			4.2	%			$	561,548			$	542,834			3.4	%
Homeowners	205,211				190,037				8.0	%			84,257				108,404				(22.3	)%			99,368				102,008				(2.6	)%
RV/Packaged	57,801				61,314				(5.7	)%			55,882				58,167				(3.9	)%			46,956				49,411				(5.0	)%
Small Business Auto	60,717				83,829				(27.6	)%			46,429				65,420				(29.0	)%			53,733				60,059				(10.5	)%
Lender-placed insurance	103,922				58,859				76.6	%			64,674				37,214				73.8	%			71,102				60,278				18.0	%
Other	12,930				15,739				(17.8	)%			4,944				5,314				(7.0	)%			9,278				3,382				174.3	%
Total Premium	$	1,053,508			$	1,021,090			3.2	%			$	789,428			$	786,471			0.4	%			$	841,985			$	817,972			2.9	%
Accident & Health
Group	89,467				75,036				19.2	%			69,217				57,960				19.4	%			69,232				57,949				19.5	%
Individual	100,190				82,799				21.0	%			98,995				82,652				19.8	%			99,565				83,916				18.6	%
Total Premium Domestic	$	189,657			$	157,835			20.2	%			$	168,212			$	140,612			19.6	%			$	168,797			$	141,865			19.0	%
International	—				13,837				(100.0	)%			—				12,095				(100.0	)%			—				24,184				(100.0	)%
Total National General	$	1,243,165			$	1,192,762			4.2	%			$	957,640			$	939,178			2.0	%			$	1,010,782			$	984,021			2.7	%
Total National General (A)	$	1,243,165			$	1,178,925			5.4	%			$	957,640			$	927,083			3.3	%			$	1,010,782			$	959,837			5.3	%
Reciprocal Exchanges
Personal Auto	$	37,382			$	43,984			(15.0	)%			$	34,281			$	18,661			83.7	%			$	31,714			$	16,093			97.1	%
Homeowners	60,160				76,140				(21.0	)%			22,667				37,211				(39.1	)%			22,741				30,225				(24.8	)%
Other	894				1,022				(12.5	)%			320				348				(8.0	)%			330				312				5.8	%
Total Premium	$	98,436			$	121,146			(18.7	)%			$	57,268			$	56,220			1.9	%			$	54,785			$	46,630			17.5	%
Consolidated Total	$	1,341,601			$	1,313,908			2.1	%			$	1,014,908			$	995,398			2.0	%			$	1,065,567			$	1,030,651			3.4	%

(A) Excludes A&H international product line which was sold in the fourth quarter of 2019.

Premiums by Product Line
$ in thousands
(Unaudited)

	Six Months Ended June 30,
	Gross Written Premium												Net Written Premium												Net Earned Premium
	2020				2019				Change				2020				2019				Change				2020				2019				Change
Property & Casualty
Personal Auto	$	1,407,424			$	1,377,993			2.1	%			$	1,235,549			$	1,170,872			5.5	%			$	1,141,050			$	1,053,388			8.3	%
Homeowners	370,464				342,079				8.3	%			172,800				193,649				(10.8	)%			190,851				186,066				2.6	%
RV/Packaged	110,929				113,165				(2.0	)%			107,860				109,764				(1.7	)%			96,248				99,716				(3.5	)%
Small Business Auto	133,469				169,707				(21.4	)%			105,028				139,606				(24.8	)%			113,158				127,692				(11.4	)%
Lender-placed insurance	199,366				134,797				47.9	%			142,143				79,284				79.3	%			140,769				101,996				38.0	%
Other	29,532				29,014				1.8	%			12,140				8,824				37.6	%			12,811				6,033				112.3	%
Total Premium	$	2,251,184			$	2,166,755			3.9	%			$	1,775,520			$	1,701,999			4.3	%			$	1,694,887			$	1,574,891			7.6	%
Accident & Health
Group	177,005				139,974				26.5	%			138,688				111,910				23.9	%			138,702				111,912				23.9	%
Individual	199,677				166,991				19.6	%			197,740				166,775				18.6	%			194,801				166,151				17.2	%
Total Premium Domestic	$	376,682			$	306,965			22.7	%			$	336,428			$	278,685			20.7	%			$	333,503			$	278,063			19.9	%
International	—				123,251				(100.0	)%			—				74,203				(100.0	)%			—				49,566				(100.0	)%
Total National General	$	2,627,866			$	2,596,971			1.2	%			$	2,111,948			$	2,054,887			2.8	%			$	2,028,390			$	1,902,520			6.6	%
Total National General (A)	$	2,627,866			$	2,473,720			6.2	%			$	2,111,948			$	1,980,684			6.6	%			$	2,028,390			$	1,852,954			9.5	%
Reciprocal Exchanges
Personal Auto	$	69,191			$	80,846			(14.4	)%			$	63,355			$	34,306			84.7	%			$	64,637			$	31,954			102.3	%
Homeowners	119,396				143,940				(17.1	)%			48,592				70,227				(30.8	)%			47,074				59,716				(21.2	)%
Other	1,702				1,929				(11.8	)%			616				642				(4.0	)%			672				618				8.7	%
Total Premium	$	190,289			$	226,715			(16.1	)%			$	112,563			$	105,175			7.0	%			$	112,383			$	92,288			21.8	%
Consolidated Total	$	2,818,155			$	2,823,686			(0.2	)%			$	2,224,511			$	2,160,062			3.0	%			$	2,140,773			$	1,994,808			7.3	%

(A) Excludes A&H international product line which was sold in the fourth quarter of 2019.

Fee Income
$ in thousands
(Unaudited)

	Three Months Ended June 30,											Six Months Ended June 30,
	2020				2019				Change			2020				2019				Change
Property & Casualty
Service and Fee Income	$	111,955			$	113,112			(1.0	)%		$	222,588			$	232,488			(4.3	)%
Ceding Commission Income	35,059				39,418				(11.1	)%		71,090				87,827				(19.1	)%
Property & Casualty	$	147,014			$	152,530			(3.6	)%		$	293,678			$	320,315			(8.3	)%
Accident & Health
Service and Fee Income
Group	$	43,241			$	32,862			31.6	%		$	83,723			$	63,236			32.4	%
Individual	2,265				1,242				82.4	%		4,482				3,378				32.7	%
Medicare Sales	11,078				5,159				114.7	%		22,790				12,260				85.9	%
Third Party Fee	23,484				13,674				71.7	%		49,597				35,075				41.4	%
Total Service and Fee Income	80,068				52,937				51.3	%		160,592				113,949				40.9	%
Ceding Commission Income	471				3,928				(88.0	)%		1,031				6,519				(84.2	)%
Accident and Health	$	80,539			$	56,865			41.6	%		$	161,623			$	120,468			34.2	%
Total National General	$	227,553			$	209,395			8.7	%		$	455,301			$	440,783			3.3	%
Reciprocal Exchanges
Service and Fee Income	$	2,336			$	1,516			54.1	%		$	3,493			$	2,886			21.0	%
Ceding Commission Income	11,110				16,846				(34.0	)%		24,824				35,380				(29.8	)%
Reciprocal Exchanges	$	13,446			$	18,362			(26.8	)%		$	28,317			$	38,266			(26.0	)%
Consolidated Total (A)	$	227,232			$	209,100			8.7	%		$	456,978			$	444,141			2.9	%

NOTES: (A) Consolidated Total includes eliminations between National General and the Reciprocal Exchanges in Service and Fee Income of $(13,767) and $(18,657) in the three months ended June 30, 2020 and 2019, respectively, and $(26,640) and $(34,908) in the six months ended June 30, 2020 and 2019, respectively.

Additional Disclosures

(1) References to operating earnings and basic and diluted operating earnings per share (“EPS”) are non-GAAP financial measures defined by the Company as net income/loss and basic and diluted earnings per share excluding after-tax net gain or loss on investments (including credit loss on investments in debt securities and foreign exchange gain or loss), earnings or losses of equity method investments (related parties), deferred tax asset impairment, non-cash impairment of goodwill and non-cash amortization of intangible assets, and any significant non-recurring or infrequent items that may not be indicative of ongoing operations. The Company believes operating earnings and basic and diluted operating EPS are relevant measures of the Company’s profitability because operating earnings and basic and diluted operating EPS contain the components of net income upon which the Company’s management has the most influence and excludes factors outside management’s direct control and non-recurring items. Other companies may calculate these measures differently, and therefore, their measures may not be comparable to those used by National General. Please see the Non-GAAP Financial Measures table within this release for the reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measure.

(2) Total investments includes $235,458 and $238,841 from related parties at June 30, 2020 and December 31, 2019, respectively.

(3) Other includes $2,405 and $2,391 from related parties at June 30, 2020 and December 31, 2019, respectively.

(4) Preferred stock: $0.01 par value - authorized 10,000,000 shares, issued and outstanding 2,565,120 shares - June 30, 2020; authorized 10,000,000 shares, issued and outstanding 2,565,120 shares - December 31, 2019.

(5) Common stock: $0.01 par value - authorized 150,000,000 shares, issued 113,856,628 and outstanding 113,397,545 shares - June 30, 2020; authorized 150,000,000 shares, issued and outstanding 113,368,811 shares - December 31, 2019.

(6) Treasury stock, at cost: 459,083 shares - June 30, 2020.

(7) Loss and loss adjustment expense ratio (loss ratio) is calculated by dividing loss and loss adjustment expense by net earned premium.

(8) Operating expense ratio is a non-GAAP financial measure defined by the Company, which is commonly used in the insurance industry. The Company calculates the ratio by dividing operating expense by net earned premium. Operating expense consists of the sum of acquisition and other underwriting costs and general and administrative expenses less ceding commission income and service and fee income. The ratio is used as an indicator of the Company’s efficiency in acquiring and servicing its business.

(9) Combined ratio is a non-GAAP financial measure defined by the Company, which is commonly used in the insurance industry. The Company calculates the ratio by adding the loss and loss adjustment expense ratio⁽⁷⁾ and the operating expense ratio (non-GAAP)⁽⁸⁾ together. The ratio is used as an indicator of the Company’s underwriting discipline, efficiency in acquiring and servicing its business, and overall underwriting profit. Management uses operating expense ratio (non-GAAP) and combined ratio (non-GAAP) to evaluate financial performance against historical results and establish targets. A combined ratio under 100% generally indicates an underwriting profit, while over 100% an underwriting loss.

(10) Operating expense ratio before amortization and impairment is a non-GAAP financial measure defined by the Company, which is commonly used in the insurance industry. The Company calculates the ratio by dividing the operating expense before amortization and impairment by net earned premium. Operating expense before amortization and impairment consists of the sum of acquisition and other underwriting costs and general and administrative expenses less ceding commission income, service and fee income, non-cash amortization of intangible assets and non-cash impairment of goodwill. The ratio is used as an indicator of the Company’s efficiency in acquiring and servicing its business. Management believes that this measure provides a more useful comparison to the operating expense ratio of other insurance companies involved in fewer acquisitions.

(11) Combined ratio before amortization and impairment is a non-GAAP financial measure defined by the Company, which is commonly used in the insurance industry. The Company calculates the ratio by adding the loss and loss adjustment expense ratio⁽⁷⁾ and the operating expense ratio before amortization and impairment (non-GAAP)⁽¹⁰⁾ together. The ratio is used as an indicator of the Company’s underwriting discipline, efficiency in acquiring and servicing its business, and overall underwriting profit. Management believes that this measure of underwriting profitability provides a more useful comparison to the combined ratio of other insurance companies involved in fewer acquisitions. A combined ratio under 100% generally indicates an underwriting profit, while over 100% an underwriting loss.

(12) Combined ratio (non-GAAP), operating expense ratio (non-GAAP), combined ratio before amortization and impairment (non-GAAP) and operating expense ratio before amortization and impairment (non-GAAP) are considered non-GAAP financial measures under applicable SEC rules. Other companies may calculate these ratios differently, and therefore, their measures may not be comparable to those used by National General. Please see the Non-GAAP Financial Measures table within this release for the reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measure.

(13) Trailing twelve month operating return on average equity is the ratio of the previous twelve months operating earnings (non-GAAP) to average shareholders’ equity for the same twelve-month period. Average shareholders’ equity is the sum of the shareholders’ equity excluding preferred stock at the beginning and end of the period divided by two. In the opinion of the Company’s management this ratio is an important indicator of how well management creates value for its shareholders through its operating activities and capital management. Other companies may calculate these measures differently, and therefore, their measures may not be comparable to those used by National General. Please see the Non-GAAP Financial Measures table within this release for the reconciliation of net income to operating earnings, which is the Non-GAAP component of the operating return on average equity.

(14) Combined ratio excluding losses from various weather-related events, is calculated by taking the combined ratio as defined in Note 11, and adjusting it to exclude the total net losses of $35.3 million and $18.4 million from these events for the three months ended June 30, 2020 and 2019, respectively. The Company believes this measure enhances investors’ understanding of our results by eliminating what we believe are volatile and unusual events.

Year				Combined Ratio (11)			Impact of Weather-related Events			Combined Ratio Excluding Weather-related Events (14)
2020		P&C Segment		83.6%			4.2%			79.4%
2020		Overall NGHC		80.5%			3.5%			77.0%
2019		P&C Segment		92.6%			2.2%			90.4%
2019		Overall NGHC		90.9%			1.2%			89.7%

(15) Our products in the P&C segment include personal auto, homeowners, RV/Packaged, small business auto, lender-placed insurance and other products. The personal auto product includes policies for standard, preferred and nonstandard automobile insurance. The homeowners product includes multiple-peril policies and personal umbrella coverage to the homeowner. The RV/Packaged product offers policies that include RV automatic personal effects coverage, optional replacement cost coverage, RV storage coverage and full-time liability coverage. The small business auto product offers policies that include liability and physical damage coverage for light-to-medium duty commercial vehicles. The lender-placed insurance product offers fire, home and flood products, as well as collateral protection insurance and guaranteed asset protection products for automobiles. Our products and revenue in the A&H segment include group, individual and third party fees. The group product includes revenue from our small group self-funded product. The individual product line includes revenue from our supplemental products including short-term medical, accident/AD&D, hospital indemnity, cancer/critical illness, dental and term life insurance. Medicare fees include commission and general agent fees for selling Medicare policies issued by third-party insurance companies as well as revenue from our Medicare Supplement product. Third party fees include commission and general agent fees for selling policies issued by third-party insurance companies, fees generated through selling our technology products to third parties.

Investor Contact

Clifford Gallant
SVP of Capital Strategy and Investor Relations
Phone: 212-380-9462
Email: Clifford.Gallant@NGIC.COM

FAQ

What is National General Holdings Corp's net income for Q2 2020?

National General Holdings Corp. reported a net income of $157.6 million for the second quarter of 2020.

How did National General Holdings Corp perform compared to Q2 2019?

In Q2 2020, National General's net income increased significantly by 128.3% compared to Q2 2019.

What is the key financial metric reported for National General Holdings Corp in Q2 2020?

The combined ratio improved to 80.5% in Q2 2020, down from 90.9% in the prior year.

What acquisition deal did National General Holdings Corp announce?

National General announced an agreement to be acquired by Allstate for a total consideration of $34.50 per share.

What was the growth in stockholders' equity for National General Holdings Corp?

Stockholders' equity grew by 13.0% to $3.0 billion as of June 30, 2020.