<PAGE> 1
1 of 17
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the quarterly period ended March 31, 1996
Commission file number 1-11422
PennCorp Financial Group, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 13-3543540
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
745 Fifth Avenue, New York, New York 10151
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code (212) 832-0700
Former Name, Former Address and Former Fiscal Year, If Changes Since Last Report
Indicate by check x 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
common stock, as of the latest practicable date.
Class May 10, 1996
Common Stock, $.01 Par Value 27,879,347
<PAGE> 2
PennCorp Financial Group, Inc. and Subsidiaries
INDEX
Page
No.
---
Part I. Financial Information:
Item 1. Financial Statements
Consolidated Condensed Balance Sheets -
March 31, 1996 and December 31, 1995................... 3
Consolidated Statements of Income -
Three Months Ended March 31, 1996 and 1995............. 4
Consolidated Condensed Statements of Cash Flows -
Three Months Ended March 31, 1996 and 1995............. 5
Notes to Consolidated Condensed Financial Statements......... 6
Review by Independent Certified Public Accountants........... 8
Independent Auditor's Report................................. 9
Item 2.Management's Discussion and Analysis of
Financial Condition and Results of Operations......... 10
Part II. Other Information:
Item 1. Legal Proceedings.......................................... 12
Item 6. Exhibits and Reports on Form 8-K........................... 13
Signature.................................................................... 14
Index to Exhibits............................................................ 15
<PAGE> 3
Part I. Financial Information -- Item 1. Financial Statements
PennCorp Financial Group, Inc. and Subsidiaries
Consolidated Condensed Balance Sheets
(Dollars in thousands, except per share information)
(Unaudited)
<TABLE>
<CAPTION>
----------- -----------
March 31, December 31,
1996 1995
----------- -----------
<S> <C> <C>
ASSETS:
Investments:
Fixed maturities:
Held for investment, at amortized cost (market $42,090 and $51,354) $ 42,090 $ 51,366
Available for sale, at market (cost $1,649,533 and $1,414,187) 1,672,242 1,486,985
Equity securities available for sale, at market (cost $14,202 and $13,707) 16,262 15,172
Trading securities at market 32,380 86,104
Mortgage loans on real estate 17,723 36,563
Policy loans 124,608 125,179
Short term investments 136,823 416,953
Other investments 47,672 43,937
----------- -----------
Total investments 2,089,800 2,262,259
Cash 23,270 27,778
Accrued investment income 26,826 30,992
Accounts and notes receivable 33,814 34,842
Investments in unconsolidated affiliates 125,566 119,390
Present value of insurance in force 292,020 288,664
Deferred policy acquisition costs 210,692 193,903
Costs in excess of net assets acquired 120,596 121,795
Other assets 208,355 70,383
----------- -----------
Total assets $ 3,130,939 $ 3,150,006
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY:
Liabilities:
Policy liabilities $ 2,202,549 $ 2,229,047
Notes payable 170,271 307,271
Income taxes, primarily deferred 25,378 24,977
Other liabilities 78,965 92,198
----------- -----------
Total liabilities 2,477,163 2,653,493
----------- -----------
Mandatory redeemable preferred stock:
Series B, $.01 par value, $100 redemption value; authorized, issued and
outstanding 127,500 shares at March 31, 1996 and December 31, 1995 13,640 13,307
Series C, $.01 par value, $100 redemption value; authorized, issued and
outstanding 178,500 shares at March 31, 1996 and December 31, 1995,
respectively 17,117 16,700
Shareholder's Equity:
Convertible preferred stock, $.01 par value, $50 redemption value; authorized
issued and outstanding 2,300,000 at March 31, 1996 and
December 31, 1995, respectively 110,513 110,513
Common stock, $.01 par value; authorized 50,000,000 shares; issued and
outstanding 28,011,008 shares at March 31, 1996 and 22,879,708 at
December 31, 1995 280 229
Treasury stock (3,370) (3,370)
Other shareholders' equity 515,596 359,134
----------- -----------
Total shareholders' equity 623,019 466,506
----------- -----------
Total liabilities and shareholders' equity $ 3,130,939 $ 3,150,006
=========== ===========
</TABLE>
See accompanying notes to unaudited consolidated condensed financial statements.
3
<PAGE> 4
PennCorp Financial Group, Inc. and Subsidiaries
Consolidated Statements of Income
(Amounts in thousands, except per share information)
(Unaudited)
<TABLE>
<CAPTION>
-----------------------------
Three Months Ended
March 31,
-----------------------------
1996 1995
--------- ---------
<S> <C> <C>
REVENUES:
Premiums, principally accident and sickness $ 64,421 $ 60,756
Interest sensitive product policy charges 22,669 11,149
Net investment income 41,334 15,616
Other income 4,281 1,614
Net gains (losses) from sale of investments (527) (441)
--------- ---------
Total revenues 132,178 88,694
--------- ---------
BENEFITS AND EXPENSES:
Claims incurred 44,326 32,072
Change in liability for future policy benefits and other policy benefits 11,490 2,729
Amortization of present value of insurance in force and deferred policy
acquisition costs 14,859 9,420
Amortization of costs in excess of net assets acquired 2,030 1,427
Underwriting and other administrative expenses 23,632 19,443
Interest and related debt costs 6,057 5,603
--------- ---------
Total benefits and expenses 102,394 70,694
--------- ---------
Income before income taxes 29,784 18,000
Income taxes 9,630 6,034
--------- ---------
Income before extraordinary charge 20,154 11,966
Extraordinary loss on retirement of debt, net of tax benefit (816) --
--------- ---------
Net income 19,338 11,966
Preferred stock dividend requirements 2,691 866
--------- ---------
Net income available to common shareholders' $ 16,647 $ 11,100
--------- ---------
Net income per share:
Primary
Income before extraordinary charge $ 0.69 $ 0.54
Extraordinary charge (0.03) --
--------- ---------
Net income $ 0.66 $ 0.54
========= =========
Fully diluted
Income before extraordinary charge $ 0.63
Extraordinary charge (0.03)
=========
Net income $ 0.60
=========
Common shares used in computing primary earnings per share 25,483 20,455
========= =========
Common shares used in computing fully diluted earnings per share 30,593
=========
</TABLE>
See accompanying notes to unaudited consolidated condensed financial statements.
4
<PAGE> 5
PennCorp Financial Group, Inc. and Subsidiaries
Consolidated Condensed Statements of Cash Flows
(Dollars in thousands)
(Unaudited)
<TABLE>
<CAPTION>
-----------------------------
Three Months Ended
March 31,
-----------------------------
1996 1995
--------- ---------
<S> <C> <C>
Net cash flows from operating activities $ (11,575) $ (2,540)
--------- ---------
Cash flows from investing activities:
Purchases of invested assets (426,683) (28,540)
Sales of invested assets 246,015 14,190
Maturities of invested assets 39,495 5,849
Other, primarily short term investments, net 127,764 (17,558)
--------- ---------
Net cash used by investing activities (13,409) (26,059)
--------- ---------
Cash flows from financing activities:
Issuance of common stock 155,759 50,781
Reduction in notes payable (137,000) (29,500)
Dividends (3,332) (1,464)
Receipts from interest sensitive policies credited to policyholder
account balances 27,718 15,093
Return of policyholder account balances of interest sensitive products (22,669) (11,148)
--------- ---------
Net cash provided by financing activities 20,476 23,762
--------- ---------
Decrease in cash (4,508) (4,837)
Cash at beginning of period 27,778 13,037
--------- ---------
Cash at end of period $ 23,270 $ 8,200
========= =========
Supplemental disclosures:
Income taxes paid $ 829 $ 1,907
========= =========
Interest paid $ 2,757 $ 2,879
========= =========
</TABLE>
See accompanying notes to unaudited consolidated condensed financial statements.
5
<PAGE> 6
PennCorp Financial Group, Inc. and Subsidiaries
Notes to Unaudited Consolidated Condensed Financial Statements
(1) Summary of Significant Accounting Policies
(A) Business and Organization
PennCorp Financial Group, Inc. (the "Company") is an insurance holding
company. The Company commenced operations with the acquisition of Pennsylvania
Life Insurance Company ("PLIC") and Executive Fund Life Insurance ("EFLIC")
(PLIC and EFLIC collectively referred to herein as "Penn Life") and Pacific Life
and Accident Insurance Company ("PLAIC") on August 23, 1990. Through its
wholly-owned life insurance subsidiaries, PLIC, EFLIC, Peninsular Life Insurance
Company ("Peninsular"), Professional Insurance Corporation ("Professional"),
Pioneer Security Life Insurance Company ("Pioneer Security") and its
wholly-owned subsidiaries American-Amicable Life Insurance Company of Texas and
Pioneer American Insurance Company (Pioneer Security and its subsidiaries
collectively referred to herein as "AATX"), Salem Life Insurance Corporation
("SLIC") and its wholly-owned subsidiaries Integon Life Insurance Corporation
("ILIC"), Georgia International Life Insurance Company and Occidental Life
Insurance Company of North Carolina ("OLIC"), (SLIC and its wholly-owned
subsidiaries collectively referred to herein as "Integon Life") and PLAIC, the
Company offers a broad range of life insurance and accident and sickness
products to individuals through general agents and through a sales force that is
contractually exclusive to certain of the Company's subsidiaries.
The accompanying consolidated financial statements include the accounts of
the Company and its wholly-owned subsidiaries. All significant intercompany
accounts and transactions have been eliminated. All dollar amounts presented
hereafter, except per share information, are stated in thousands.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make certain estimates and
assumptions that affect the reported amounts of assets and liabilities and the
reported amounts of revenues and expenses during the reporting period. Accounts
that the Company deems to be acutely sensitive to changes in estimates include
deferred policy acquisition costs, future policy benefits, policy and contract
claims and present value of insurance in force. In addition, the Company must
determine requirements for disclosure of contingent assets and liabilities as of
the date of the financial statements based upon estimates. In all instances,
actual results could differ from these estimates.
(B) Basis of Presentation
In the opinion of management, the accompanying unaudited consolidated
condensed financial statements contain all adjustments, none of which are other
than normal recurring accruals, necessary to present fairly the financial
position as of March 31, 1996, and the results of operations and cash flows for
the three-month periods ended March 31, 1996, and 1995. Results of operations
for interim periods are not necessarily indicative of results for the entire
year.
(2) Common Stock
On March 5, 1996, the Company consummated the sale of 5,131,300 shares of
common stock ("the March offering"). Net proceeds from the offering were
$155,759 and the effect on the Company's financial position was to increase
common stock by $51 and additional paid in capital by $155,708.
6
<PAGE> 7
(3) Extraordinary Charge
The Company utilized $137,000 of proceeds from the March offering to retire
certain indebtedness of the Company and its subsidiaries. As a result of the
early retirement of such indebtedness and the resulting write-off of deferred
financing costs, the Company realized an after-tax extraordinary charge of $816
for the three-month period ended March 31, 1996. If the retirement of debt and
issuance of common stock had occurred at the beginning of the period, primary
and fully diluted earnings per share would have increased $0.01, respectively.
(4) Knightsbridge
In March 1996, during the continuing negotiations of the terms of the joint
venture relationship between the Company and Knightsbridge Capital Fund I, L.P.,
David J. Stone, Chairman of the Board and CEO and Steven W. Fickes, President
and CFO of the Company and the members of the Knightsbridge Committee of the
Company's Board of Directors jointly concluded that it would be appropriate to
explore a comprehensive restructuring of the Knightsbridge relationship,
including the formulation of compensation arrangements between the Company and
each of Messrs. Stone and Fickes. Discussions are continuing and the Board of
Directors has postponed the Company's 1996 Annual Meeting until July 11, 1996 to
enable the Company to submit the final terms of the restructuring arrangements
and Messrs. Stone's and Fickes' compensation arrangements requiring shareholder
approval.
[Rest of Page Intentionally Left Blank]
7
<PAGE> 8
Review By Independent Certified Public Accountants
The March 31, 1996 and 1995 financial statements included in this Quarterly
Report on Form 10-Q have been reviewed by KPMG Peat Marwick LLP, independent
certified public accountants, in accordance with established professional
standards and procedures for such a review.
The report of KPMG Peat Marwick LLP commenting upon their review is
included on page 9 of this Quarterly Report on Form 10-Q.
[Rest of Page Intentionally Left Blank]
8
<PAGE> 9
KPMG Peat Marwick LLP
150 Fayetteville Street Mall
Suite 1200
Post Office Box 29543
Raleigh, NC 27626
Independent Auditors' Review Report
The Board of Directors and Shareholders
PennCorp Financial Group, Inc.
We have reviewed the accompanying consolidated condensed balance sheet of
PennCorp Financial Group, inc. and subsidiaries as of March 31, 1996, and the
related consolidated statements of income and consolidated condensed statements
of cash flows for the three-month periods ended March 31, 1996 and 1995. These
financial statements are the responsibility of the Company's management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with generally accepted auditing standards, the objective of which is the
expression of an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the financial statements referred to above for them to be in
conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet of PennCorp Financial Group, Inc. as
of December 31, 1995 and the related consolidated statements of income,
shareholders' equity, and cash flows for the year then ended (not presented
herein); and in our report dated February 5, 1996, we expressed an unqualified
opinion on those consolidated financial statements. In our opinion, the
financial information set forth in the accompanying consolidated condensed
balance sheet as of December 31, 1995 is fairly presented, in all material
respects, in relation to the consolidated balance sheets from which it has been
derived.
/s/ KPMG Peat Marwick LLP
May 8, 1996
Raleigh, North Carolina
9
<PAGE> 10
Item 2.
Management's Discussion and Analysis of Financial Condition and Results of
Operations.
This "Management's Discussion and Analysis of Financial Condition and Results of
Operations" should be read in conjunction with the comparable discussion filed
with the Company's annual filing with the Securities and Exchange Commission on
Form 10-K for the fiscal year ended December 31, 1995 as amended by Amendment
No. 1 and the Company's 1995 Annual Report to Shareholders.
The following discussion should be read in conjunction with the unaudited
consolidated condensed financial statements and related notes to this Quarterly
Report on Form 10-Q.
Financial Condition, Liquidity and Capital Resources
During the three months ended March 31, 1996, cash used by operations (when
including interest sensitive products cash flows for both periods) was $6.5
million compared to cash provided by operations of $1.4 million for the
three-month period ended March 31, 1995. Integon Life operations used $8.6
million of cash in its operations as a result of the run off of a closed block
of annuity contracts. Excluding the impact of Integon Life, cash provided by
operations improved by $700,000 to $2.1 million. The improvement in cash flows
from operating activities, excluding Integon, was due in part to the increased
premium volume with collected premium increasing to $71.7 million during the
first three-months of 1996 from $69.6 million for the comparable 1995 period.
Additionally, investment income received increased by $3.6 million while income
taxes paid were $1.1 million lower during the three-month period ended March 31,
1996 as compared to the three-month period ended March 31, 1995. Offsetting
these improvements were higher cash commissions and general expense payments of
$4.7 million and increased claim payments of $1.5 million.
On March 5, 1996, the Company consummated the sale of 5,131,300 shares of common
stock from which it received net proceeds of $155.8 million. Part of the
proceeds were used to retire approximately $137.0 million of the Company's debt
while the remainder of the proceeds were used for general corporate purposes.
Results of Operations
Policy Revenues Total policy revenues for the three months ended March 31, 1996
increased 21.1% to $87.1 million from $71.9 million for the comparable period
ended March 31, 1995. Life product revenue increased $17.3 million to $42.3
million while fixed benefit accident and sickness product revenues declined by
$2.1 million to $44.9 million. The significant increase in revenues from life
products was due primarily to the inclusion of $17.5 million in revenues from
Integon Life. The decline in policy revenues from accident and sickness products
was primarily attributable to the Company's decision during 1995 to discontinue
new business production of certain disability income products. In addition,
policy revenues from Penn Life and Occi Life closed blocks of business declined
approximately $400,000 for the three-month period ended March 31, 1996 when
compared to 1995. Policy revenues from foreign operations (primarily Canada)
increased by 15.6% or approximately $1.4 million for the first three months of
1996 when compared to the three month period ended March 31, 1995. Policy
revenues expressed in Canadian dollars increased approximately 11.7% or $1.5
million (Canadian). The higher increase in foreign operations revenues reported
in U.S. dollars resulted from the stronger Canadian dollar which advanced
against the U.S. dollar by approximately 2.7 percent.
Net Investment Income Net investment income for the three months ended March 31,
1996 was $41.3 million compared to $15.6 million for the three months ended
March 31, 1995. The majority of the increase in investment income of $25.7
million was attributable to the addition of Integon Life. Investment yield,
based upon weighted average amount of invested assets outstanding each period,
was approximately 7.2% and 7.5% for the three-month periods ended March 31, 1996
and 1995, respectively. Contributing to the decline in investment yield is the
run off block of Integon Life annuity contracts. The Company has had to maintain
a more liquid position at Integon Life by having a higher percentage of its
invested assets in short-term securities earning approximately 5.0 percent.
10
<PAGE> 11
Other Revenue Included in other revenue for the period ended March 31, 1996 is
$4.3 million representing the Company's 74.8% economic participation in the
undistributed earnings of Southwestern Financial Corporation compared to $1.5
million representing the Company's interest in the earnings of Integon Life
prior to its acquisition in July 1995. Also included in other revenue is
$500,000 of losses resulting from trading activities.
Claims Incurred Claims incurred for the three months ended March 31, 1996
increased 38.2% to $44.3 million from $32.1 million for the three-month period
ended March 31, 1995. Claims from fixed benefit accident and sickness products
increased by $400,000 while life claims increased by $11.8 million. The increase
in life claims incurred is primarily attributable to the inclusion of $15.0
million of claims from Integon Life with an improvement in life claims from
other operating units. Additionally, offsetting these increases was a decline in
payments for discontinued blocks of business in Penn Life and OLIC of
approximately $600,000.
Underwriting and Other Administrative Expenses For the three-month period ended
March 31, 1996, underwriting and other administrative expenses increased 21.5%
to $23.6 million from $19.4 million for the three month period ended March 31,
1995. The increase is primarily attributable to the inclusion $1.9 million of
expenses from Integon Life as well as expenses incurred with the outsourcing of
certain data processing services to The Continuum Company (TCC). The Company
entered an agreement with TCC on January 1, 1996 in which TCC will assume
responsibility for a substantial portion of the Company's data processing by
March 1997. The Company anticipates that, in the long term, this agreement will
significantly reduce its data processing costs. During the three-month period
ended March 31, 1996, the Company incurred expenses of $986,000 related to the
TCC agreement.
Interest and Related Debt Costs For the three-month period ended March 31, 1996,
interest and amortization of deferred debt issuance costs increased 8.1% to $6.1
million from $5.6 million for the comparable 1995 period. The increase is
primarily attributable to the inclusion of $1.4 million of interest costs
relating to the investment in Southwestern Life. Offsetting some of this
increase was a reduction in interest costs of approximately $700,000 relating to
the early retirement of the AATX credit facility.
Income Taxes The effective tax rate for the three months ended March 31, 1996
was 32.3% compared to 33.5% for the three months ended March 31, 1995. The
effective tax rate for these periods is less than the federal statutory rate of
35% primarily due to the inclusion of $4.3 million and $1.5 million,
respectively, in undistributed earnings of unconsolidated affiliates that are
not subject to tax.
[Rest of Page Intentionally Left Blank]
11
<PAGE> 12
Part II. Other Information
Item 1.
Legal Proceedings
The Company is a party to various pending or threatened legal actions arising in
the ordinary course of business, some of which include allegations of
insufficient policy illustrations and agent misrepresentations. Although the
outcome of such actions is not presently determinable, management does not
believe that such matters, individually, or in the aggregate, would have a
material adverse effect on the Company's financial position or results of
operations if resolved against the Company.
[Rest of Page Intentionally Left Blank]
12
<PAGE> 13
Item 6.
Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit
Numbers
-------
11.1 Computation of earning per share
15.1 Independent Auditor's Report
27 Financial Data Schedule
(b) Reports on Form 8-K
(i) A report on Form 8-K/A (Amendment No. 1) dated January 29,
1996 was filed with the Securities and Exchange Commission
on February 21, 1996 related to the Company's economic
participation in Southwestern Financial Corporation
providing the audited combined financial statements as of
December 31, 1994 and 1993 and for each of the years in the
three-year period ended December 31, 1994 and unaudited
combined financial statements as of September 30, 1995 and
for the nine-month period ended September 30, 1995 for the
insurance operations of I.C.H. Corporation acquired by
Southwestern Financial Corporation, the Notes thereto and
the Independent Auditors' Report with respect thereto, and
the unaudited pro forma statements of operations of the
Company for the year ended December 31, 1994 and for the
nine-months ended September 30, 1995, and the unaudited pro
forma balance sheet of the Company as of September 30, 1995
and the Notes thereto, reflecting the consummation of the
investment by the Company in Southwestern Financial
Corporation.
13
<PAGE> 14
SIGNATURE
Pursuant to the requirements 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.
PennCorp Financial Group, Inc.
------------------------------
(The Registrant)
Date: May 15, 1996 By: /s/ Steven W. Fickes
--------------------
Steven W. Fickes
President and Chief Financial Officer
(Authorized officer and principal accounting
and financial officer of the Registrant)
14
<PAGE> 15
INDEX TO EXHIBITS
Exhibit Page
Numbers Number
- - ------- ------
11.1 Computation of earnings per share
15.1 Independent Auditor's Report *
27 Financial Data Schedule
* Such exhibit is incorporated by reference to page 9 of this Form 10-Q.
15
<PAGE> 1
EXHIBIT 11.1
Statement re Computation of Earnings Per Share
(Amounts in thousands)
<TABLE>
<CAPTION>
------------------------
Three Months Ended
March 31,
------------------------
1996 1995
------- -------
<S> <C> <C>
Primary:
Shares outstanding beginning of period 22,880 19,130
Issuance of 5,131 shares on March 5, 1996 1,466 --
Issuance of 3,750 shares on March 16, 1995 -- 667
Incremental shares attributable to:
Warrants issued pursuant to August 1990 employment agreement 496 420
Options granted pursuant to the Company's Stock Option Plans 312 261
Warrants issued pursuant to a Senior Management Stock Warrant Plan 519 3
Treasury Shares (190) (26)
======= =======
25,483 20,455
======= =======
Fully diluted:
Shares outstanding beginning of period 22,880
Issuance of 5,131 shares March 5, 1996 1,466
Incremental shares attributable to:
Warrants issued pursuant to August 1990 employment agreement 498
Options granted pursuant to the Company's Stock Option Plan 314
Warrants issued pursuant to a Senior Management Stock Warrant Plan 537
Treasury shares (190)
Conversion of 2,300 shares of Preferred Stock at $22.60 at a rate of 2.2123 common
shares to 1 preferred share 5,088
------- -------
30,593 N/A
======= =======
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 7
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<DEBT-HELD-FOR-SALE> 1,672,242
<DEBT-CARRYING-VALUE> 42,090
<DEBT-MARKET-VALUE> 42,090
<EQUITIES> 16,262
<MORTGAGE> 17,723
<REAL-ESTATE> 20,078
<TOTAL-INVEST> 2,089,800
<CASH> 23,270
<RECOVER-REINSURE> 31,215
<DEFERRED-ACQUISITION> 210,692
<TOTAL-ASSETS> 3,130,939
<POLICY-LOSSES> 2,116,472
<UNEARNED-PREMIUMS> 16,279
<POLICY-OTHER> 30,247
<POLICY-HOLDER-FUNDS> 39,551
<NOTES-PAYABLE> 170,271
30,757
110,513
<COMMON> 280
<OTHER-SE> 512,226
<TOTAL-LIABILITY-AND-EQUITY> 3,130,939
87,090
<INVESTMENT-INCOME> 41,334
<INVESTMENT-GAINS> (527)
<OTHER-INCOME> 4,281
<BENEFITS> 55,816
<UNDERWRITING-AMORTIZATION> 40,521
<UNDERWRITING-OTHER> 6,057
<INCOME-PRETAX> 29,784
<INCOME-TAX> 9,630
<INCOME-CONTINUING> 20,154
<DISCONTINUED> 0
<EXTRAORDINARY> 816
<CHANGES> 0
<NET-INCOME> 19,338
<EPS-PRIMARY> 0.66
<EPS-DILUTED> 0.60
<RESERVE-OPEN> 0
<PROVISION-CURRENT> 0
<PROVISION-PRIOR> 0
<PAYMENTS-CURRENT> 0
<PAYMENTS-PRIOR> 0
<RESERVE-CLOSE> 0
<CUMULATIVE-DEFICIENCY> 0
</TABLE>
