Suspense to the finish, Obama and Romney now cede stage to voters for Election Day decision
WASHINGTON (AP) — Two fierce competitors who’ve given their all, President Barack Obama and Republican Mitt Romney now yield center stage to voters for an Election Day choice that will frame the contours of government and the nation for years to come.
After a grinding presidential campaign that packed suspense to the finish, Americans head into polling places in sleepy hollows, bustling cities and superstorm-ravaged beach towns deeply divided. All sides are awaiting, in particular, a verdict from the nine battleground states whose votes will determine which man can piece together the 270 electoral votes needed for victory.
Obama has more options for getting there. So Romney decided to make a late dash to Cleveland and Pittsburgh on Tuesday while running mate Paul Ryan threw in stops in Cleveland and Richmond, Va. Obama opted to make a dozen radio and satellite TV interviews from his hometown of Chicago to keep his closing arguments fresh in voters’ minds.
Both sides cast the Election Day choice as one with far-reaching repercussions for a nation still recovering from the biggest economic downturn since the Great Depression and at odds over how big a role government should play in solving the country’s problems.
‘‘It’s a choice between two different visions for America,’’ Obama declared in Madison, Wis., asking voters to let him complete work on the economic turnaround that began in his first term. ‘‘It’s a choice between returning to the top-down policies that crashed our economy, or a future that’s built on providing opportunity to everybody and growing a strong middle class.’’
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No matter who wins White House, new Congress a likely problem for new president’s agenda
WASHINGTON (AP) — No matter who is elected president, he’s likely to find that the next Congress will remain what the current one has been for President Barack Obama — a headache.
Months of speeches, saturation TV advertising, uncountable events and more than $2 billion in campaign spending are coming together to produce a new Congress strikingly similar to the one that exists now: a House that Republicans will run with about a 50-seat margin, and a Senate narrowly controlled by Democrats.
Republicans started this year thinking they would grab control of the Senate because they were only defending 10 of the 33 seats at stake on Election Day. That seems unlikely now thanks to controversial rape statements by GOP candidates in Missouri and Indiana, the retirement of popular Maine GOP Sen. Olympia Snowe, and strong races run by Democratic incumbents in Florida and Michigan.
Democrats seem certain to fall short of adding the 25 seats they need to take over the House, and at best may gain a handful of districts. With Republicans gaining governorships and state legislatures in the 2010 elections, the GOP was better able to draw new district lines reflecting the latest census to protect their incumbents and put Democratic House members in less friendly terrain.
‘‘My sense is no one will have a mandate coming out of this,’’ GOP consultant Matt Mackowiak said Monday. ‘‘And clearly we’re going to have divided government. And that’s going to make the next two years very difficult.’’
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While other issues have surfaced, economy remains single most important one in this election
WASHINGTON (AP) — The race for the White House is pretty much back where it started, after thousands of ads, billions of dollars in spending, two conventions and three presidential debates. Despite some detours, the emphasis is heavily on the nation’s lukewarm economy and President Barack Obama’s stewardship of it.
But if Tuesday’s election does amount to a referendum on the Obama economy, the outcome likely won’t shine a bright light on how to fix it. There’s too much polarization in the nation’s capital and in the country as a whole — regardless of who wins — to produce a clear consensus plan for averting a looming ‘‘fiscal cliff’’ of higher taxes and deep automatic cuts in military and domestic spending.
Last week’s devastating East Coast storm, the campaign debates and controversy over the deadly terrorist attack on the U.S. Consulate in Benghazi, Libya, scrambled things a bit in the home stretch.
But as millions of Americans vote for president, Congress and thousands of state and local posts, the excruciatingly slow economic recovery and continued high joblessness were clearly weighing on their minds.
Obama’s Republican challenger, Mitt Romney, doggedly tried to keep the focus on the economy. Its poor performance on Obama’s watch has been his main theme. He cites his own business background in presenting himself as the person who can heal it and restore jobs.
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Housing, voting, power: Problems abound post-Sandy, and another storm is on the way
NEW YORK (AP) — From trying to figure out where people would live to how they would be able to vote and when all the lights will finally come on, government officials are still facing multiple fronts in the efforts to recover from Superstorm Sandy. All that, and there’s another storm coming.
Where to house potentially tens of thousands of people left homeless by the storm is the most pressing crisis, as cold weather sets in.
‘‘It’s not going to be a simple task. It’s going to be one of the most complicated and long-term recovery efforts in U.S. history,’’ said Mark Merritt, president of Witt Associates, a Washington crisis management consulting firm founded by former Federal Emergency Management Agency director James Lee Witt.
FEMA said it has already dispensed close to $200 million in emergency housing assistance and has put 34,000 people in New York and New Jersey up in hotels and motels. But local, state and federal officials have yet to lay out a specific, comprehensive plan for finding them long-term places to live. And given the scarcity and high cost of housing there and the lack of open space, it could prove a monumental undertaking.
Sandy killed more 100 people in 10 states but vented the worst of its fury on New Jersey and New York. A week after the storm slammed the mid-Atlantic and the Northeast, more than 1 million homes and businesses remained without power.
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Gunmen assassinate brother of parliament speaker in Syrian capital
BEIRUT (AP) — Syria’s state-run TV reports that gunmen have assassinated the brother of the parliament speaker.
The report on Tuesday said Mohammed Osama Laham was killed in the Damascus neighborhood of Midan. It did not say when it happened, but a Syrian official said Laham was killed Monday night.
The TV and the Syrian official, who spoke on condition of anonymity because he was not authorized to speak to media, said Laham was a brother of Parliament Speaker Jihad Laham.
A number of officials and top army officers have been assassinated in Syria since the uprising against President Bashar Assad began in March last year.
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Prosecutor: US soldier watched revenge killing movie, drank before Afghan village massacre
JOINT BASE LEWIS-McCHORD, Wash. (AP) — Staff Sgt. Robert Bales spent the evening on his remote outpost in southern Afghanistan with fellow soldiers, watching a movie about revenge killings, sharing whiskey from a plastic bottle and discussing an attack that cost one of their friends his leg.
Within hours, a prosecutor said Monday, a cape-wearing Bales embarked on a killing spree of his own, slaughtering 16 Afghan civilians before returning to the base in predawn darkness, bloody and incredulous that his comrades ordered him to surrender his weapons.
‘‘I thought I was doing the right thing,’’ a fellow soldier recalled him saying.
The details emerged at the opening of a preliminary hearing in Bales’ case at Joint Base Lewis-McChord, offering the clearest picture yet of one of the worst atrocities of the Iraq and Afghanistan wars.
The prosecutor, Lt. Col. Jay Morse, said that after Bales attacked one village near his post at Camp Belambay, he returned, woke a colleague to report what he had done, and said that he was headed out to attack another village.
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Ballot measures highlighted by historic votes to legalize gay marriage, recreational marijuana
Lady Gaga and Brad Pitt have weighed in on one side, evangelist icon Billy Graham on the other as the four-state showdown over same-sex marriage reaches its Election Day conclusion with the potential for a historic breakthrough.
Until now, same-sex marriage has been rejected in all 32 states that have held popular votes on the issue. Gay-rights advocates believe they have a chance to break that streak as Maine, Maryland and Washington state vote on whether to legalize same-sex marriage, and Minnesota votes on whether to place a ban on gay marriage in the state constitution.
In all, there are 176 measures on the ballots in 38 states, according to the Initiative and Referendum Institute at the University of Southern California. Washington, Oregon and Colorado could become the first to legalize recreational use of marijuana; Massachusetts is considering whether to allow physician-assisted suicide; Californians have a chance to repeal the death penalty.
But no other issue has generated the star power or multistate intensity of the same-sex marriage measures.
In just the past week, Lady Gaga released a video backing same-sex marriage, while Pitt donated $100,000 to support the cause. On the other side, Graham, 93, took out newspaper ads asking voters to support ‘‘the biblical definition of marriage between a man and a woman.’’
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NY, NJ officials go to considerable lengths to help residents vote in wake of superstorm
NEW YORK (AP) — Authorities in New York and New Jersey were set to drive some displaced voters to their polling sites and direct others to cast ballots elsewhere as residents insisted the devastation wrought by Superstorm Sandy wouldn’t stop them from participating in Tuesday’s election.
‘‘Nothing is more important than voting. What is the connection between voting and this?’’ said Alex Shamis, a resident of hard-hit Staten Island, gesturing to his mud-filled home.
Election officials in both states were guardedly optimistic that power would be restored and most polling places would be open in all but the worst-hit areas. New York Gov. Andrew Cuomo signed an executive order Monday allowing residents to cast a so-called affidavit, or provisional ballot, at any polling place in the state for president and statewide office holders, an opportunity New Jersey was extending to voters as well.
‘‘Compared to what we have had to deal with in the past week, this will be a walk in the park when it comes to voting,’’ Cuomo said.
Provisional ballots are counted after elected officials confirm a voter’s eligibility.
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Defense set to begin for Texas woman facing murder charge in deadly fire at her home day care
HOUSTON (AP) — Attorneys for a Texas woman facing a murder charge after a fire at her home day care killed four children and injured three other kids could begin presenting their case to jurors.
However, Jessica Tata’s defense team declined to say how many witnesses, if any, they planned to call Tuesday to testify in a Houston courtroom.
Prosecutors rested their case against Tata on Monday after calling about 30 witnesses over nearly two weeks.
Investigators allege that Tata had left the seven children she was caring for alone at her home to go shopping at a nearby Target store when oil in a pan ignited atop a stovetop burner that had been left on. The children in the February 2011 fire ranged in age from 16 months to 3 years old.
Tata’s attorneys insist she never intended to harm the children and that she tried to save them from the fire.
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Saints beat slumping Eagles 28-13 on Robinson’s 99-yard interception return, Brees’ 2 TDs
NEW ORLEANS (AP) — Drew Brees and the New Orleans Saints are having fun again. They hope it’s a sign of things to come in the second half of the season.
Michael Vick kept picking himself up off the Superdome turf, the recipient of an awful beating.
The Philadelphia Eagles are down — and nearly out.
Brees threw two touchdown passes, extending his NFL record streak to 51 games, and Patrick Robinson returned an interception 99 yards for a score to lead the Saints past the reeling Eagles 28-13 Monday night.
New Orleans (3-5), which bounced back from a dismal 34-14 loss at Denve2)kub0000bzwirr f OH-STATE-AUTO-FINANCIAL     11-06 1900
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State Auto Financial Reports Third Quarter 2012 Results<P>
COLUMBUS, Ohio--(BUSINESS WIRE)--Nov 6, 2012-- State Auto Financial Corporation (Nasdaq:STFC) today reported a third quarter 2012 net loss of $5.5 million, or $0.14 per diluted share, versus a net loss of $58.7 million1, or $1.46 per diluted share1, for the third quarter of 2011. Net loss from operations2 per diluted share for the third quarter 2012 was $0.25 versus net loss from operations2 of $1.62 for the same 2011 period1.
STFC’s GAAP combined ratio for the third quarter 2012 was 110.2 versus 122.41 for the third quarter of 2011. Catastrophe losses, net of reinsurance recoveries, for the third quarter 2012 accounted for 2.8 points of the 77.1 total loss ratio points, or $7.2 million, versus 17.0 points of the total 88.4 loss ratio points, or $60.8 million, for the same period in 2011. Non-catastrophe losses included $19.5 million of loss and loss expense reserve increases for prior periods on program business written by Risk Evaluation & Design LLC (RED), a wholly owned subsidiary of State Automobile Mutual Insurance Company. The reserve increases related primarily to a large commercial auto trucking program that, as previously disclosed, was cancelled as of April 1, 2012.
The State Auto Group’s homeowners quota share reinsurance arrangement increased STFC’s underwriting loss by $13.1 million or 5.8 points on the combined ratio. Pursuant to the arrangement, STFC ceded $47.5 million of written premium, $42.4 million of earned premium, $0.1 million of catastrophe losses and $17.0 million of non-catastrophe losses, and recognized $12.2 million of ceded commissions. This cession increased STFC’s overall catastrophe loss ratio 0.4 points, increased the overall non-catastrophe loss ratio 4.8 points and increased the overall expense ratio 0.6 points.
Net written premium for the third quarter of 2012 decreased 29.1% over the same period in 2011. The homeowners’ quota share reinsurance arrangement and the year-end pooling change collectively contributed the entire amount of this decline. By segment, net written premium for the third quarter of 2012 decreased 42.2% for personal insurance, increased 0.5% for business insurance and decreased 29.0% for specialty insurance from the same period in 2011. Excluding the impact of the quota share reinsurance arrangement and pooling change, net written premium for the third quarter of 2012 increased 2.9%3 from the same period in 2011, with the business insurance segment contributing primarily to the overall growth. The business segment growth was principally driven by higher average new business premium, increased renewal pricing and a recovering economy. Additionally, business segment net written premium includes $7.2 million of unearned premium transferred from terminating an umbrella quota share reinsurance arrangement effective July 1, 2012. Excluding the impact of the homeowners’ quota share and pooling change, net written premium for the third quarter decreased 0.8%3 for the personal insurance segment, increased 23.7%3 for the business insurance segment and decreased 12.6%3 for the specialty insurance segment from the same period in 2011.
For the first nine months of 2012, STFC had a net loss of $10.2 million, or $0.25 per diluted share, compared to a loss of $260.0 million1, or $6.47 per diluted share1, for the same 2011 period. STFC’s GAAP combined ratio for the first nine months of 2012 was 110.0 compared to 124.31 for the same 2011 period. Catastrophe losses increased the loss ratio for the first nine months of 2012 by 7.9 points, or $61.2 million, compared to 22.0 points, or $232.9 million for the first nine months of 2011.
For the first nine months of 2012, the homeowners quota share reinsurance arrangement reduced STFC’s underwriting loss by $18.5 million or 0.7 points on the combined ratio. Pursuant to the arrangement, STFC ceded $131.4 million of written premium, $125.9 million of earned premium, $47.5 million of catastrophe losses and $60.4 million of non-catastrophe losses, and recognized $36.5 million of ceded commissions. This cession reduced STFC’s overall catastrophe loss ratio 4.2 points, increased the overall non-catastrophe loss ratio 2.9 points and increased the overall expense ratio 0.6 points.
Net written premium year to date 2012 decreased 29.9% compared to the same 2011 period. The homeowners’ quota share reinsurance arrangement and the year-end pooling change contributed to the decrease, but were offset by growth in the business and specialty segments. For the first nine months of 2012, net written premium for the personal, business and specialty insurance segments declined 41.8%, 9.0%, and 24.8% respectively, compared to the same period in 2011. Excluding the impact of the quota share reinsurance arrangement and pooling change, net written premium for the first nine months of 2012 decreased 1.9%3 for the personal insurance segment while business and specialty insurance increased 12.0%, and 7.9%, respectively from the same period in 2011.
STFC’s book value was $18.30 per share as of Sept. 30, 2012, an increase of $0.48 per share from STFC’s book value on June 30, 2012. Book value per share as of Sept. 30, 2012, included a reduction of $2.45 for a deferred tax asset valuation allowance. Return on stockholders’ equity for the twelve months ended Sept. 30, 2012, was 13.6% compared to negative 31.8% for the twelve months ended Sept. 30, 2011. The 13.6% return on stockholders’ equity includes, in the fourth quarter of 2011, a $35.7 million tax benefit recorded as a result of intra-period tax allocations and a $14.9 million postretirement benefit curtailment gain.
STFC President and CEO Bob Restrepo commented on the quarter as follows:
“Third quarter results were helped by significantly better weather, continued improvements in our ex-catastrophe loss ratio performance for our personal, business and specialty insurance segments, and an improving pricing environment. These positive developments were offset by the previously announced reserve adjustment for the RED business now in run-off. Investment income is also down as interest rates and fixed income returns remain at historically low levels. While we’re very disappointed in the RED performance, we have confidence that the actions we’ve taken will eliminate a drag on our financial performance.
“Results in property lines, both homeowners and commercial property, were exceptional in the quarter. We benefited from a lack of catastrophes and increasing prices. Performance in personal and commercial auto was relatively unchanged, but we’re now charging higher prices in excess of loss trends and anticipate expanding margins in what are traditionally our most profitable lines. Liability lines also improved as our changes to the claim process are beginning to pay off. In our specialty segment, our Rockhill and RTW subsidiaries are producing solid underwriting profits and good growth. These specialty businesses will be important contributors to diversifying our source of future earnings and achieving greater scale in the commercial lines market place.”
State Auto Financial Corporation, headquartered in Columbus, Ohio, is a super regional property and casualty insurance holding company and is proud to be a Trusted Choice(R) company partner. STFC stock is traded on the NASDAQ Global Select Market, which represents the top third of all NASDAQ listed companies.
The insurance subsidiaries of State Auto Financial Corporation are part of the State Auto Group. The State Auto Group markets its insurance products throughout the United States, through independent insurance agencies, which include retail agencies and wholesale brokers. The State Auto Group is rated A (Excellent) by the A.M. Best Company and includes State Automobile Mutual, State Auto Property & Casualty, State Auto Ohio, State Auto Wisconsin, State Auto Florida, Milbank, Farmers Casualty, Meridian Security, Meridian Citizens Mutual, Beacon National, Beacon Lloyds, Patrons Mutual, Litchfield Mutual Fire, Rockhill Insurance, Plaza Insurance, American Compensation and Bloomington Compensation. Additional information on State Auto Financial Corporation and the State Auto Insurance Companies can be found online at http://www.StateAuto.com/STFC.
1 The Company adopted Accounting Standards Update 2010-26, “Accounting for Costs Associated with Acquiring and Renewing Insurance Contracts” effective Jan. 1, 2012, and has applied its provisions retrospectively. All applicable prior period amounts have been adjusted to conform to current period presentation.
2 Net income (loss) from operations, a non-GAAP financial measure which management believes is informative to Company management and investors, differs from GAAP net income (loss) only by the exclusion of realized capital gains and (losses), net of applicable taxes, on investment activity for the periods being reported. For STFC, this amounted to income of $0.11 per diluted share for the third quarter 2012 and income of $0.34 year to date versus income of $0.16 per diluted share for the third quarter 2011 and income of $0.40 year to date.
3 Represents a non-GAAP financial measure as to net written premium. A reconciliation of the difference between this non-GAAP financial measure with the most directly comparable GAAP financial measure is included in Schedule 1 that is part of this release.
STFC has scheduled a conference call with interested investors for Tuesday, Nov. 6 at 10 a.m. ET to discuss the company’s third quarter 2012 performance. Live and archived broadcasts of the call can be accessed at http://www.StateAuto.com/STFC. A replay of the call can be heard beginning at noon, Nov. 6, by calling 866-462-8977. Supplemental schedules detailing the company’s third quarter 2012 financial, sales and underwriting results are made available on http://www.StateAuto.com/STFC prior to the conference call.
Except for historical information, all other information in this news release consists of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. The most significant of these uncertainties are described in State Auto Financial’s Form 10-K and Form 10-Q reports and exhibits to those reports, and include (but are not limited to) legislative changes at both the state and federal level, state and federal regulatory rule making promulgations and adjudications, class action litigation involving the insurance industry and judicial decisions affecting claims, policy coverages and the general costs of doing business, the impact of competition on products and pricing, inflation in the costs of the products and services insurance pays for, product development, geographic spread of risk, weather and weather-related events, and other types of catastrophic events. State Auto Financial undertakes no obligation to update or revise any forward-looking statements. This article has been truncated. You can see the rest of this article by visiting http://www.businesswir9 5ab0000bzwirr f OH-STATE-AUTO-FINANCIAL     11-06 1900
<B>BC-OH-STATE-AUTO-FINANCIAL
State Auto Financial Reports Third Quarter 2012 Results<P>
COLUMBUS, Ohio--(BUSINESS WIRE)--Nov 6, 2012-- State Auto Financial Corporation (Nasdaq:STFC) today reported a third quarter 2012 net loss of $5.5 million, or $0.14 per diluted share, versus a net loss of $58.7 million1, or $1.46 per diluted share1, for the third quarter of 2011. Net loss from operations2 per diluted share for the third quarter 2012 was $0.25 versus net loss from operations2 of $1.62 for the same 2011 period1.
STFC’s GAAP combined ratio for the third quarter 2012 was 110.2 versus 122.41 for the third quarter of 2011. Catastrophe losses, net of reinsurance recoveries, for the third quarter 2012 accounted for 2.8 points of the 77.1 total loss ratio points, or $7.2 million, versus 17.0 points of the total 88.4 loss ratio points, or $60.8 million, for the same period in 2011. Non-catastrophe losses included $19.5 million of loss and loss expense reserve increases for prior periods on program business written by Risk Evaluation & Design LLC (RED), a wholly owned subsidiary of State Automobile Mutual Insurance Company. The reserve increases related primarily to a large commercial auto trucking program that, as previously disclosed, was cancelled as of April 1, 2012.
The State Auto Group’s homeowners quota share reinsurance arrangement increased STFC’s underwriting loss by $13.1 million or 5.8 points on the combined ratio. Pursuant to the arrangement, STFC ceded $47.5 million of written premium, $42.4 million of earned premium, $0.1 million of catastrophe losses and $17.0 million of non-catastrophe losses, and recognized $12.2 million of ceded commissions. This cession increased STFC’s overall catastrophe loss ratio 0.4 points, increased the overall non-catastrophe loss ratio 4.8 points and increased the overall expense ratio 0.6 points.
Net written premium for the third quarter of 2012 decreased 29.1% over the same period in 2011. The homeowners’ quota share reinsurance arrangement and the year-end pooling change collectively contributed the entire amount of this decline. By segment, net written premium for the third quarter of 2012 decreased 42.2% for personal insurance, increased 0.5% for business insurance and decreased 29.0% for specialty insurance from the same period in 2011. Excluding the impact of the quota share reinsurance arrangement and pooling change, net written premium for the third quarter of 2012 increased 2.9%3 from the same period in 2011, with the business insurance segment contributing primarily to the overall growth. The business segment growth was principally driven by higher average new business premium, increased renewal pricing and a recovering economy. Additionally, business segment net written premium includes $7.2 million of unearned premium transferred from terminating an umbrella quota share reinsurance arrangement effective July 1, 2012. Excluding the impact of the homeowners’ quota share and pooling change, net written premium for the third quarter decreased 0.8%3 for the personal insurance segment, increased 23.7%3 for the business insurance segment and decreased 12.6%3 for the specialty insurance segment from the same period in 2011.
For the first nine months of 2012, STFC had a net loss of $10.2 million, or $0.25 per diluted share, compared to a loss of $260.0 million1, or $6.47 per diluted share1, for the same 2011 period. STFC’s GAAP combined ratio for the first nine months of 2012 was 110.0 compared to 124.31 for the same 2011 period. Catastrophe losses increased the loss ratio for the first nine months of 2012 by 7.9 points, or $61.2 million, compared to 22.0 points, or $232.9 million for the first nine months of 2011.
For the first nine months of 2012, the homeowners quota share reinsurance arrangement reduced STFC’s underwriting loss by $18.5 million or 0.7 points on the combined ratio. Pursuant to the arrangement, STFC ceded $131.4 million of written premium, $125.9 million of earned premium, $47.5 million of catastrophe losses and $60.4 million of non-catastrophe losses, and recognized $36.5 million of ceded commissions. This cession reduced STFC’s overall catastrophe loss ratio 4.2 points, increased the overall non-catastrophe loss ratio 2.9 points and increased the overall expense ratio 0.6 points.
Net written premium year to date 2012 decreased 29.9% compared to the same 2011 period. The homeowners’ quota share reinsurance arrangement and the year-end pooling change contributed to the decrease, but were offset by growth in the business and specialty segments. For the first nine months of 2012, net written premium for the personal, business and specialty insurance segments declined 41.8%, 9.0%, and 24.8% respectively, compared to the same period in 2011. Excluding the impact of the quota share reinsurance arrangement and pooling change, net written premium for the first nine months of 2012 decreased 1.9%3 for the personal insurance segment while business and specialty insurance increased 12.0%, and 7.9%, respectively from the same period in 2011.
STFC’s book value was $18.30 per share as of Sept. 30, 2012, an increase of $0.48 per share from STFC’s book value on June 30, 2012. Book value per share as of Sept. 30, 2012, included a reduction of $2.45 for a deferred tax asset valuation allowance. Return on stockholders’ equity for the twelve months ended Sept. 30, 2012, was 13.6% compared to negative 31.8% for the twelve months ended Sept. 30, 2011. The 13.6% return on stockholders’ equity includes, in the fourth quarter of 2011, a $35.7 million tax benefit recorded as a result of intra-period tax allocations and a $14.9 million postretirement benefit curtailment gain.
STFC President and CEO Bob Restrepo commented on the quarter as follows:
“Third quarter results were helped by significantly better weather, continued improvements in our ex-catastrophe loss ratio performance for our personal, business and specialty insurance segments, and an improving pricing environment. These positive developments were offset by the previously announced reserve adjustment for the RED business now in run-off. Investment income is also down as interest rates and fixed income returns remain at historically low levels. While we’re very disappointed in the RED performance, we have confidence that the actions we’ve taken will eliminate a drag on our financial performance.
“Results in property lines, both homeowners and commercial property, were exceptional in the quarter. We benefited from a lack of catastrophes and increasing prices. Performance in personal and commercial auto was relatively unchanged, but we’re now charging higher prices in excess of loss trends and anticipate expanding margins in what are traditionally our most profitable lines. Liability lines also improved as our changes to the claim process are beginning to pay off. In our specialty segment, our Rockhill and RTW subsidiaries are producing solid underwriting profits and good growth. These specialty businesses will be important contributors to diversifying our source of future earnings and achieving greater scale in the commercial lines market place.”
State Auto Financial Corporation, headquartered in Columbus, Ohio, is a super regional property and casualty insurance holding company and is proud to be a Trusted Choice(R) company partner. STFC stock is traded on the NASDAQ Global Select Market, which represents the top third of all NASDAQ listed companies.
The insurance subsidiaries of State Auto Financial Corporation are part of the State Auto Group. The State Auto Group markets its insurance products throughout the United States, through independent insurance agencies, which include retail agencies and wholesale brokers. The State Auto Group is rated A (Excellent) by the A.M. Best Company and includes State Automobile Mutual, State Auto Property & Casualty, State Auto Ohio, State Auto Wisconsin, State Auto Florida, Milbank, Farmers Casualty, Meridian Security, Meridian Citizens Mutual, Beacon National, Beacon Lloyds, Patrons Mutual, Litchfield Mutual Fire, Rockhill Insurance, Plaza Insurance, American Compensation and Bloomington Compensation. Additional information on State Auto Financial Corporation and the State Auto Insurance Companies can be found online at http://www.StateAuto.com/STFC.
1 The Company adopted Accounting Standards Update 2010-26, “Accounting for Costs Associated with Acquiring and Renewing Insurance Contracts” effective Jan. 1, 2012, and has applied its provisions retrospectively. All applicable prior period amounts have been adjusted to conform to current period presentation.
2 Net income (loss) from operations, a non-GAAP financial measure which management believes is informative to Company management and investors, differs from GAAP net income (loss) only by the exclusion of realized capital gains and (losses), net of applicable taxes, on investment activity for the periods being reported. For STFC, this amounted to income of $0.11 per diluted share for the third quarter 2012 and income of $0.34 year to date versus income of $0.16 per diluted share for the third quarter 2011 and income of $0.40 year to date.
3 Represents a non-GAAP financial measure as to net written premium. A reconciliation of the difference between this non-GAAP financial measure with the most directly comparable GAAP financial measure is included in Schedule 1 that is part of this release.
STFC has scheduled a conference call with interested investors for Tuesday, Nov. 6 at 10 a.m. ET to discuss the company’s third quarter 2012 performance. Live and archived broadcasts of the call can be accessed at http://www.StateAuto.com/STFC. A replay of the call can be heard beginning at noon, Nov. 6, by calling 866-462-8977. Supplemental schedules detailing the company’s third quarter 2012 financial, sales and underwriting results are made available on http://www.StateAuto.com/STFC prior to the conference call.
Except for historical information, all other information in this news release consists of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. The most significant of these uncertainties are described in State Auto Financial’s Form 10-K and Form 10-Q reports and exhibits to those reports, and include (but are not limited to) legislative changes at both the state and federal level, state and federal regulatory rule making promulgations and adjudications, class action litigation involving the insurance industry and judicial decisions affecting claims, policy coverages and the general costs of doing business, the impact of competition on products and pricing, inflation in the costs of the products and services insurance pays for, product development, geographic spread of risk, weather and weather-related events, and other types of catastrophic events. State Auto Financial undertakes no obligation to update or revise any forward-looking statements. This article has been truncated. You can see the rest of this article by visiting http://www.businesswire.com/news/home/20121106005217/en.