Storm claims slam United Fire Group earnings

United Fire Group on Wednesday reported sharply lower second-quarter earnings primarily due to losses from more than a dozen catastrophic storms in the Midwest and Texas.

The Cedar Rapids insurer posted net income of $3.1 million, or 8 cents per share, for the three-month period that ended on June 30, down 79.3 percent from $15 million, or 57 cents per share, for the same period in 2015. Revenues increased 9.3 percent from $255.9 million in the second quarter of 2015 to $279.8 million in the same period this year.

The results topped Thomson Reuters analysts' earnings estimate of 7 cents per share and revenue projection of $277.1 million.

Catastrophic losses totaled $35.5 million, or 90 cents per share, in the second quarter, compared with $20.2 million, or 52 cents per share, for the same period in 2015.

'The increase in catastrophe losses in the second quarter was driven by hail and wind storms, primarily in Texas and the Midwest, impacting our commercial property, commercial auto, personal homeowners and personal auto lines of business,” United Fire Group President and CEO Randy Ramlo said in news release.

'Second and third quarters are typically the most significant quarters with storms and catastrophe events in geographic areas where we conduct much of our business due to spring and summer convective storms and hurricanes.”

On a more positive note, Ramlo said United Fire Group's book of business continues to grow organically.

'Consolidated net premiums earned increased 10.6 percent in the three-month period that ended on June 30, compared with the same period of 2015,” Ramlo said.

Net income for the company's property and casualty insurance segment, including net realized investment gains and losses, totaled $3.4 million, or 13 cents per share, in the second quarter, compared with $13.3 million, or 52 cents per share, in the same period in 2015.

United Fire Group's life insurance segment recorded a net loss of $300,000, or 1 cent per share, in the second quarter, compared with $1.7 million, or 7 cents per share, for the second quarter of 2015.