SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
[ X ] Quarterly Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the quarterly period ended September 30, 1996.
OR
[ ] Transition Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from
___________________ to ___________________.
Commission file number 0-11413
MERIDIAN INSURANCE GROUP, INC.
(Exact name of registrant as specified in its charter)
Indiana 35-1689161
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
2955 North Meridian Street
P.O. Box 1980
Indianapolis, IN 46206
(Address of principal executive offices)
Registrant's telephone number, including area code: (317) 931-7000
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90
days. Yes X No
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practical date:
6,779,375 Common Shares at September 30, 1996
The Index of Exhibits is located at page 15 in the sequential numbering system.
Total pages: 15
<PAGE> 2
MERIDIAN INSURANCE GROUP, INC., AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION
Item 1. In the opinion of management, the financial
information reflects all adjustments (consisting only of
normal recurring adjustments) which are necessary for a
fair presentation of financial position, results of
operations and cash flows for the interim periods. The
results for the three and nine months ended September 30,
1996, are not necessarily indicative of the results to be
expected for the entire year.
These quarterly interim financial statements are unaudited.
<PAGE> 3
MERIDIAN INSURANCE GROUP, INC., AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
as of September 30, 1996 and December 31, 1995
September 30, December 31,
1996 1995
(Unaudited)
ASSETS
Investments:
Fixed maturities--available for sale, at market
(cost $232,587,000 and $213,816,000) $234,606,130 $220,036,772
Equity securities, at market
(cost $30,453,000 and $26,961,000) 36,390,362 31,119,875
Short-term investments, at cost, which
approximates market 3,509,293 2,483,338
Other invested assets 1,148,924 1,053,905
Total investments 275,654,709 254,693,890
Cash 1,215,894 935,098
Premiums receivable, net of allowance for bad debts 3,562,618 2,642,425
Accrued investment income 3,126,229 2,942,194
Deferred policy acquisition costs 16,554,780 13,354,600
Goodwill 17,091,978 2,152,339
Reinsurance receivables 56,870,582 32,469,285
Prepaid reinsurance premiums 5,239,308 2,617,138
Due from Meridian Mutual Insurance Company 25,106,797 9,358,803
Other assets 8,055,982 1,422,444
Total assets $412,478,877 $322,588,216
LIABILITIES AND SHAREHOLDERS' EQUITY
Losses and loss adjustment expenses $158,890,521 $123,577,240
Unearned premiums 87,178,317 64,558,695
Other post-retirement benefits 1,387,955 1,298,378
Bank loan payable 12,000,000 --
Payable for securities -- 1,122,637
Reinsurance payables 28,054,562 6,863,626
Other liabilities 6,848,655 6,924,973
Total liabilities 294,360,010 204,345,549
Shareholders' equity:
Common shares, no par value, authorized 20,000,000
shares; issued 6,805,955 at September 30, 1996 and
6,803,385 at December 31, 1995; outstanding
6,779,375 at September 30, 1996, and 6,776,805 at
December 31, 1995 44,077,846 44,076,685
Contributed capital 15,058,327 15,058,327
Unrealized appreciation of investment securities, net
of deferred income tax 5,241,365 6,842,245
Retained earnings 53,741,329 52,265,410
Total shareholders' equity 118,118,867 118,242,667
Total liabilities and shareholders' equity $412,478,877 $322,588,216
The accompanying notes are an integral part of the consolidated financial
statements.
<PAGE> 4
MERIDIAN INSURANCE GROUP, INC., AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
for the three months ended September 30, 1996 and 1995
(Unaudited)
September 30,
1996 1995
Premiums earned $ 44,165,128 $ 36,883,914
Net investment income 3,795,862 3,674,414
Realized investment gains 890,618 867,665
Other income (expense) 138,359 (25,648)
Total revenues 48,989,967 41,400,345
Losses and loss adjustment expenses 33,650,503 25,413,362
General operating expenses 3,794,045 3,444,584
Amortization expenses 9,735,046 7,982,521
Interest expense 120,000 --
Total expenses 47,299,594 36,840,467
Income before income taxes 1,690,373 4,559,878
Income taxes (benefit):
Current 468,141 1,164,000
Deferred (584,000) (8,000)
Total income taxes (benefit) (115,859) 1,156,000
Net income $ 1,806,232 $ 3,403,878
Weighted average shares outstanding 6,779,375 6,776,144
Per share results:
Net income $ 0.27 $ 0.50
The accompanying notes are an integral part of the consolidated
financial statements.
<PAGE> 5
MERIDIAN INSURANCE GROUP, INC., AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
for the nine months ended September 30, 1996 and 1995
(Unaudited)
September 30,
1996 1995
Premiums earned $119,593,174 $107,354,031
Net investment income 11,052,696 10,976,822
Realized investment gains 2,482,868 1,174,103
Other income 523,145 194,984
Total revenues 133,651,883 119,699,940
Losses and loss adjustment expenses 94,767,547 76,773,829
General operating expenses 10,157,668 10,362,884
Amortization expenses 26,061,557 22,917,338
Interest expense 120,000 --
Total expenses 131,106,772 110,054,051
Income before income taxes 2,545,111 9,645,889
Income taxes (benefit):
Current 560,141 2,126,000
Deferred (1,118,000) 104,000
Total income taxes (benefit) (557,859) 2,230,000
Net income $ 3,102,970 $ 7,415,889
Weighted average shares outstanding 6,779,253 6,767,859
Per share results:
Net income $ 0.46 $ 1.10
The accompanying notes are an integral part of the consolidated
financial statements.
<PAGE> 6
MERIDIAN INSURANCE GROUP, INC., AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
for the nine months ended September 30, 1996 and 1995
(Unaudited)
Unrealized
Appreciation
Common Contributed (Depreciation) Retained
Shares Capital of Investments Earnings
Balance at January 1, 1995 $43,930,722 $15,058,327 $(7,281,724) $42,545,114
Net income -- -- -- 7,415,889
Unrealized appreciation of
investment securities, net
of deferred income taxes -- -- 10,415,200 --
Dividends ($0.21 per share) -- -- -- (1,422,366)
Exercise of stock options
for 40,121 common shares 220,696 -- -- --
Repurchase and retirement
of 6,479 common shares (77,033) -- -- --
Balance at September 30,
1995 $44,074,385 $15,058,327 $ 3,133,476 $48,538,637
Balance at January 1, 1996 $44,076,685 $15,058,327 $ 6,842,245 $52,265,410
Net income -- -- -- 3,102,970
Unrealized depreciation of
investment securities, net
of deferred income taxes -- -- (1,600,880) --
Dividends ($0.24 per share) -- -- -- (1,627,051)
Exercise of stock options
for 4,042 common shares 23,241 -- -- --
Repurchase and retirement
of 1,472 common shares (22,080) -- -- --
Balance at September 30,
1996 $44,077,846 $15,058,327 $ 5,241,365 $53,741,329
The accompanying notes are an integral part of the consolidated
financial statements.
<PAGE> 7
MERIDIAN INSURANCE GROUP, INC., AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
for the nine months ended September 30, 1996 and 1995
(Unaudited)
September 30,
1996 1995
Cash flows from operating activities:
Net income $ 3,102,970 $ 7,415,889
Reconciliation of net income to net cash provided by
operating activities:
Deferred policy acquisition costs, net (887,339) (1,192,569)
Increase in unearned premiums 5,146,765 4,112,093
Increase (decrease) in losses and loss adjustment
expenses 8,635,429 (169,264)
Increase in amount due from Meridian Mutual
Ins. Co. (15,747,994) (310,511)
Decrease (increase) in reinsurance receivables (18,372,200) 3,430,478
Decrease in other assets 7,002,160 35,552
Increase in other post-employment benefits 89,577 73,197
Increase in reinsurance payables 21,190,936 1,766,709
Decrease in accrued commissions and other
expenses (2,554,513) (558,356)
Decrease in other liabilities (755,054) (479,010)
Net realized investment gains (2,482,868) (1,174,103)
Other, net (1,424,793) 223,338
Net cash provided by operating activities 2,943,076 13,173,443
Cash flows from investing activities:
Purchase of fixed maturities, available for sale (26,133,061) (26,155,168)
Proceeds from sale of fixed maturities,
available for sale 27,111,009 6,352,960
Proceeds from calls, prepayments and maturity of
fixed maturities, available for sale 16,477,483 12,140,017
Purchase of equity securities (13,468,404) (13,850,408)
Proceeds from sale of equity securities 13,354,120 8,060,066
Net decrease (increase) in short-term investments 1,117,429 (6,473,850)
Decrease (increase) in other invested assets (95,019) 40,706
Acquisition of subsidiary (30,209,343) --
Increase (decrease) in payable for securities (1,258,578) 7,448,782
Net cash used in investing activities (13,104,364) (12,436,895)
Cash flows from financing activities:
Dividends paid (1,559,077) (1,352,584)
Bank loan payable 12,000,000 --
Repurchase and retirement of common stock (22,080) (77,033)
Exercise of stock options 23,241 220,696
Net cash provided by (used) in financing activities 10,442,084 (1,208,921)
Increase (decrease) in cash 280,796 (472,373)
Cash at beginning of period 935,098 603,566
Cash at end of period $ 1,215,894 $ 131,193
The accompanying notes are an integral part of the consolidated
financial statements.
<PAGE> 8
MERIDIAN INSURANCE GROUP, INC., AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
The unaudited consolidated financial statements should be read in
conjunction with the following notes and with the Notes to
Consolidated Financial Statements of Meridian Insurance Group, Inc.,
for the year ended December 31, 1995. In the opinion of management,
the financial information reflects all adjustments (consisting only
of normal recurring adjustments) which are necessary for a fair
presentation of financial position, results of operations and cash
flows for the interim periods. The results for the three and nine
months ended September 30, 1996 are not necessarily indicative of
the results to be expected for the entire year.
1. Related Party Transactions
Meridian Insurance Group, Inc. (the "Company") is an insurance
holding company principally engaged in underwriting property and
casualty insurance through its wholly-owned subsidiaries,
Meridian Security Insurance Company ("Meridian Security"),
Citizens Fund Insurance Company ("Citizens Fund") and Insurance
Company of Ohio ("ICO"). Both Citizens Fund and ICO, along with
their holding company, Citizens Security Group, Inc. ("CSGI"),
were purchased by Meridian Security on July 31, 1996 (see Note 3
below). Effective August 1, 1996, Meridian Security, Citizens
Fund and ICO all participated in a pooling arrangement with
Meridian Mutual Insurance Company ("Meridian Mutual"), the
principal shareholder of the Company, and Citizens Mutual
Insurance Company, the former majority shareholder of CSGI, in
which the underwriting income and expenses of each entity are
shared. Beginning August 1, 1996, the participation percentages
of the Company's insurance subsidiaries total 74 percent. Prior
to August 1, Meridian Security and Meridian Mutual were the only
participants in the aforementioned pooling arrangement, of which
Meridian Security assumed 74 percent of the combined underwriting
income and expenses of the two companies.
2. Reinsurance
For the nine months ended September 30, 1996 and 1995, the
effects of reinsurance on the Company's written and earned
premiums are as follows:
September 30, 1996 September 30, 1995
Written Earned Written Earned
Direct $132,586,215 $125,181,623 $115,640,954 $111,516,528
Assumed 3,303,422 5,328,276 4,152,602 4,157,814
Ceded (11,512,365) (10,916,725) (8,397,684) (8,320,311)
Net $124,377,272 $119,593,174 $111,395,872 $107,354,031
Reinsurance recoveries recognized during the nine month periods
ended September 30, 1996 and 1995 were approximately $18,066,000
and $159,000, respectively.
3. Acquisition
On July 31, 1996, the Company acquired Citizens Security Group,
Inc. and its property and casualty insurance subsidiaries,
Citizens Fund Insurance Company and Insurance Company of Ohio
("Citizens"), for a cash purchase price of approximately
$30,200,000, including capitalized acquisition costs. The
acquisition was accounted for as a purchase and resulted in
goodwill of approximately $15,100,000, which is being amortized
over 25 years on the straight-line basis.
<PAGE> 9
The acquisition was funded in part through $12,000,000 of bank
debt. The loan is being amortized over seven years with a
variable interest rate of LIBOR plus 50 basis points. The bank
debt includes certain financial covenants, the most significant
of which concern the amounts of risk based capital, statutory
policyholders' surplus, total debt and debt to capitalization.
The consolidated financial statements include the results of
operations of Citizens from the date of acquisition. Unaudited
pro-forma condensed consolidated results of operations presented
below assume the acquisition and financing of Citizens had
occurred at the beginning of each period presented:
Nine months ended
September 30,
1996 1995
Premiums $138,347,000 $130,077,000
Revenues $153,583,000 $143,884,000
Net income $ 1,109,000 $ 7,293,000
Net income per share $ 0.16 $ 1.08
These unaudited pro-forma results are not necessarily indicative
of the results of operations that would have occurred had the
acquisition taken place at the beginning of each period, or of
future operations of the combined companies.
Supplemental cash flow information for the acquisition is as
follows:
1996
Fair value of assets acquired $ 77,525,327
Cash paid 30,209,343
Liabilities assumed $ 47,315,984
<PAGE> 10
MERIDIAN INSURANCE GROUP, INC., AND SUBSIDIARIES
Item 2: Management's Discussion and Analysis of Financial Condition
and Results of Operations:
Financial Position
On July 31, 1996, the Company completed the acquisition of
Citizens Security Group, Inc. ("Citizens") of Red Wing,
Minnesota. The Company purchased all of the outstanding
shares of Citizens and its wholly-owned subsidiaries,
Citizens Fund Insurance Company and Insurance Company of
Ohio, for $30.2 million in cash, including capitalized
acquisition costs. Approximately 60 percent of the purchase
price was generated from the sale of a portion of the
Company's investment portfolio. The remaining $12 million
was financed through bank debt and will be amortized over
seven years with a variable interest rate of LIBOR plus 50
basis points. The acquisition of Citizens was accounted for
as a purchase. Accordingly, the assets acquired and
liabilities assumed were recorded at their estimated fair
value at the date of acquisition. The excess cost over the
fair value of the net assets of approximately $15.1 million
was recorded as goodwill, which will be amortized on a
straight-line basis over a 25 year period. The Company's
balance sheet at September 30, 1996 includes the assets and
liabilities of Citizens.
Total assets of Meridian Insurance Group, Inc. at September
30, 1996 were $412.5 million, an increase of 27.9 percent
over $322.6 million at December 31, 1995. This increase was
primarily attributable to the assets acquired in the
Citizens purchase. Total cash and invested assets of $276.9
million at September 30, 1996 increased 8.3 percent over the
December 31, 1995 total of $255.6 million. Contributing to
this increase was the purchase of the Citizens investment
portfolio of approximately $38 million, reduced by
approximately $17 million of the Company's invested assets
that were liquidated to fund the acquisition. The Company's
invested assets also experienced a decline of approximately
$4.2 million in the net unrealized appreciation of its fixed
maturity investment portfolio at September 30, 1996 in
comparison to the 1995 year end value.
The Company's total liabilities of $294.4 million at
September 30, 1996 were 44.0 percent higher than December
31, 1995's total of $204.3 million. Contributing to the
liability growth were the assumed liabilities from the
Citizens purchase, bank debt of $12 million and increased
reserves for losses and loss adjustment expenses and
unearned premiums. The higher reserves for losses and loss
adjustment expenses, aside from the acquisition, resulted
primarily from the increased volume and the loss experience
and payment pattern of the Meridian business. The unearned
premium reserve growth reflects the Company's increased 1996
premium volume and the acquisition of the Citizens'
business.
The Company's total shareholders' equity at September 30,
1996 was $118.1 million, virtually unchanged from the $118.2
million reported at December 31, 1995. The Company's net
income of $3.1 million for the first nine months of 1996 was
offset by the reduction in unrealized appreciation of fixed
maturities, net of unrealized gains on equity securities and
deferred income taxes, and quarterly dividends totaling
$0.24 per share. Total book value per share for Meridian
Insurance Group, Inc., decreased slightly from $17.45 at
December 31, 1995 to $17.42 at September 30, 1996.
<PAGE> 11
Results of Operations
Quarter
For the three months ended September 30, 1996, the Company
reported net income of $1.8 million, or $0.27 per common
share. This compares to the 1995 third quarter net income
of $3.4 million, or $0.50 per share. Windstorms in July and
an increase in loss severity reduced the Company's 1996
third quarter results. Results of operations include two
months of results of the Citizens companies acquired July
31, 1996. The effect of Citizens on total revenues was
approximately $6.1 million and includes $5.6 million of net
earned premiums and $0.5 million of net investment income.
Total net income for the Citizens operation for the two
months ended September 30, 1996 was approximately $0.2
million, or $0.03 per share.
The Company's total revenues for the 1996 third quarter were
$49.0 million, an increase of 18.3 percent over the $41.4
million reported for the comparable 1995 period. This was
primarily attributed to earned premiums, which is the
Company's largest component of revenue. Earned premiums of
$44.2 million, reflected growth of 19.7 percent over 1995's
third quarter total of $36.9 million. The additional
premium volume from the acquisition and direct premium
growth in nearly all of Meridian's lines of business
contributed to the increase. Net investment income for the
three months ended September 30, 1996, of $3.8 million
reflected 3.3 percent growth in comparison to the same 1995
period. The investment income generated from the Citizens
portfolio was partially offset by a reduction in the
Meridian portfolio to fund the acquisition. During both
three-month periods ended September 30, 1996 and 1995, the
Company realized net gains on the sale of investments of
approximately $0.9 million.
The Company's incurred losses and loss adjustment expenses
of $33.7 million for the quarter ended September 30, 1996,
were 32.4 percent higher than 1995 third quarter total of
$25.4 million. Approximately half of the increase, or $4.0
million of the 1996 third quarter incurred losses resulted
from the acquisition of the Citizens' book of business.
Also contributing to the current quarter increase were
catastrophe losses totaling $0.9 million and increased
severity of losses primarily in Meridian's private passenger
automobile liability and commercial multiple-peril lines of
business. The Company's loss and loss adjustment expense
ratio of 76.2 percent for the third quarter of 1996
increased 7.3 percentage points from 68.9 percent reported
for the same 1995 period. For the three month period ended
September 30, 1996, the Company's general operating and
amortization expenses of $13.6 million increased 19.4
percent from $11.4 million reported for the same 1995
period. Relative to earned premium volume, the Company's
expense ratio of 30.6 percent for the 1996 third quarter
improved from 31.0 percent for the 1995 third quarter. The
Company's combined ratio for the three months ended
September 30, 1996 was approximately 107 percent compared to
the 1995 ratio of 99.5 percent for the same three months of
1995.
The income tax benefit of $0.1 million recorded for the
three months ended September 30, 1996 resulted primarily
from the amount of tax-exempt investment income in relation
to pre-tax income.
<PAGE> 12
Nine Months
For the nine months ended September 30, 1996, Meridian
Insurance Group, Inc. reported net income of $3.1 million,
or $0.46 per share. This compares to net income of $7.4
million, or $1.10 per share, for the corresponding 1995
period. The 1996 results were hampered by a series of
severe storms that produced an unusually large volume of
property damage claims throughout the Company's operating
territory during the first seven months of 1996. The after-
tax impact of catastrophe and other weather-related non-
catastrophic claims is estimated to be approximately $1.08
per share through September 30,1996, compared to
approximately $0.42 per share through September 30, 1995.
Total revenues have grown 11.7 percent to $133.7 million
from $119.7 million for the same 1995 period. Premiums
earned have increased 11.4 percent through the first nine
months of 1996 to $119.6 million from $107.4 million for the
same 1995 period. The acquisition of Citizens and increases
in nearly all of Meridian's major lines of business
contributed to the earned premium growth. Total net
investment income for the first nine months of 1996 of $11.1
million reflected slight improvement from 1995. Although
invested assets grew, the net yield decreased due largely to
a greater proportion of assets invested in equity securities
and tax-exempt bonds. Over the first three quarters of
1996, the Company realized net gains on the sale of invested
assets of $2.5 million compared to $1.2 million for the same
period one year ago.
Through the first nine months of 1996, the Company's
incurred losses and loss adjustment expenses totaled $94.8
million, which are 23.4 percent higher than 1995's $76.8
million. Approximately $11.6 million of the current year-to-
date losses resulted from catastrophe and other weather-
related non-catastrophic claims, compared to approximately
$4.4 million incurred for the 1995 period. The loss and
loss adjustment expense ratio for the 1996 nine month period
was 79.2 percent, a deterioration of approximately 7.7
percentage points from 1995's ratio. The deterioration in
the Company's property lines of business has been somewhat
offset by improved results in the commercial auto liability
and workers' compensation lines of business.
General operating and amortization expenses of $36.3 million
for the nine months ended September 30, 1996, were 9.2
percent higher than the 1995 total of $33.3 million.
Relative to net written premiums the statutory expense ratio
for the nine months ended September 30, 1996 was 30.1
percent, which compares favorably to the 30.7 percent ratio
for the same 1995 period. Factors leading to the reduced
expense ratio include decreases in employee incentive
compensation, agent profit-sharing and assessments from
certain boards and bureaus. The statutory combined ratio
for the most recent nine-month period was approximately
109.0 percent, or 9.5 percentage points higher than 1995's
ratio.
For the nine months ended September 30, 1996, the Company
has recorded an income tax benefit of approximately $0.6
million, primarily the result of the amount of tax-exempt
investment income in relation to pre-tax income.
<PAGE> 13
MERIDIAN INSURANCE GROUP, INC., AND SUBSIDIARIES
PART II. OTHER INFORMATION
Item 6. a. Exhibits. See index to exhibits.
b. A report on Form 8-K was filed August 14, 1996,
with respect to Item 2, Item 5, and Item 7 thereof.
<PAGE> 14
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.
MERIDIAN INSURANCE GROUP, INC.
DATE: October 24, 1996 By: /s/ Norma J. Oman
Norma J. Oman, President and
Chief Executive Officer
DATE: October 24, 1996 By: /s/ Steven R. Hazelbaker
Steven R. Hazelbaker,
Vice President, Chief Financial
Officer and Treasurer
<PAGE> 15
MERIDIAN INSURANCE GROUP, INC., AND SUBSIDIARIES
FORM 10-Q
For the quarter ended September 30, 1996
Index to Exhibits
Exhibit Number
Assigned in Regulation S-K
Item 601 Description of Exhibit
(4) 4.01 Text of Certificate for Common Shares
of Meridian Insurance Group, Inc.
(Incorporated by reference to Exhibit
4.01 to the registrant's Form S-1
Registration Statement No. 33-11413.)
(27) Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 7
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<DEBT-HELD-FOR-SALE> 234,606
<DEBT-CARRYING-VALUE> 0
<DEBT-MARKET-VALUE> 3,509
<EQUITIES> 36,390
<MORTGAGE> 706
<REAL-ESTATE> 0
<TOTAL-INVEST> 275,655
<CASH> 1,216
<RECOVER-REINSURE> 5,829
<DEFERRED-ACQUISITION> 16,555
<TOTAL-ASSETS> 412,479
<POLICY-LOSSES> 158,891
<UNEARNED-PREMIUMS> 87,178
<POLICY-OTHER> 0
<POLICY-HOLDER-FUNDS> 0
<NOTES-PAYABLE> 12,000
0
0
<COMMON> 44,078
<OTHER-SE> 74,041
<TOTAL-LIABILITY-AND-EQUITY> 412,479
119,593
<INVESTMENT-INCOME> 11,053
<INVESTMENT-GAINS> 2,483
<OTHER-INCOME> 523
<BENEFITS> 94,768
<UNDERWRITING-AMORTIZATION> 26,062
<UNDERWRITING-OTHER> 10,278
<INCOME-PRETAX> 2,545
<INCOME-TAX> (558)
<INCOME-CONTINUING> 3,103
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,103
<EPS-PRIMARY> 0.46
<EPS-DILUTED> 0.46
<RESERVE-OPEN> 150,255
<PROVISION-CURRENT> 108,612
<PROVISION-PRIOR> (13,844)
<PAYMENTS-CURRENT> 60,831
<PAYMENTS-PRIOR> 30,727
<RESERVE-CLOSE> 158,891
<CUMULATIVE-DEFICIENCY> (13,844)
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