The Van Wert County Courthouse

Friday, Mar. 29, 2024

Central holds 139th policyholders’ mtg.

Central Mutual Insurance information

Central Mutual Insurance Company recognized several changes to its Board of Directors at the 139th annual Policyholders’ Meeting held May 14 in Van Wert.

F.W. Purmort, chairman of the Board and president, presented resolutions honoring both C. Allan Runser and Rodger S. Lawson for their years of service on Central’s Board of Directors.

“Mr. Runser’s leadership has now led Central Mutual to premiums approaching $540 million, assets of over $1.2 billion, and a Policyholders’ Security Fund of over $620 million,” Purmort said. During his 27 years on the board, Runser also served as chairman of the Audit Committee and contributed to the success of the company’s three-year renovation project that doubled the size of the Home Office campus.

Central revised logo“During Mr. Lawson’s nine years on the board, the Policyholders’ Security Fund has almost doubled, going from $329 million to over $620 million,” said Purmort. Lawson was also recognized for his service on the Audit Committee and his contributions to the company’s renovation project.

Purmort noted that both men’s “input and involvement has led to the profitable growth of the company and recognition by independent agents and policyholders as a company that lives its core values of integrity, relationships, and excellence. (Their) leadership has led to a financially strong company fulfilling the promise to provide security, protection, and peace of mind to our customers.”

J. Lee Covington II was elected to the Board of Directors. Covington is senior vice president and general counsel at the Insured Retirement Institute (IRI) in Washington, D.C. He has a wealth of experience in the insurance industry including work as co-leader of the National Insurance Practice at Squire Sanders & Dempsey, senior member of PricewaterhouseCoopers’ National Insurance Advisory Practice, director of the Ohio Department of Insurance in the Ohio Governor’s Cabinet, and has held positions on several committees with the National Association of Insurance Commissioners (NAIC). Covington also serves on the Board of the Griffith Foundation for Insurance Education and is a member of the Editorial Review Board of the Journal of Insurance Regulation.

Purmort began his President’s Report with positive news for the policyholders in attendance.

“I don’t know that you could have a better year than we had in 2013,” he said. “The results were just phenomenal.”

Purmort noted that while the company had planned for a conservative year with little to no growth, the combination of better underwriting decisions, investments in workflow technology, and improved customer service all contributed to the company’s $48 million improvement in underwriting results over 2012.

“We had pricing issues we still needed to pay attention to in 2013,” he said. “We didn’t anticipate much growth, but actually grew our top line by 6.6 percent through retention and new business growth, including double digit growth on the commercial side. That was a real plus.”

Purmort noted the company also committed to significant technology improvements, including completion of the rewrite of the claims management system, data security upgrades, an enhanced mobile app, and electronic signature verifications. “These improvements are all directed at improving efficiencies in our workflows and security of data,” he said. “While these were internally directed investments in our technology, the benefits gained are totally directed to our policyholders and agency partners.”

While results have improved, Purmort cautioned this is not the time to change course.

“There’s a lot going on in the industry,” said Purmort. “Our job is to listen to our policyholders and provide a stable and consistent platform of performance.” He noted the company would continue to stay cautious and controlled, while expanding service capabilities.  “We need to stay focused on our ‘wins’,” he said.

Purmort concluded his presentation by sharing the future focus of the company.

“A big part of what we do between 2015 and 2018 will be developing better pricing and selection tools,” he said. “That’s definitely the way to go.”  Other areas of focus will be expanding the company’s geographic footprint, developing moderate growth in more traditional lines, and managing and developing key partnerships and programs.

“Calendar year 2013 was an outstanding year that benefited greatly from the tough decisions and hard work over the last few years,” said Thad Eikenbary, vice president and treasurer. “I am proud to report that we recorded significant additions to our historically strong financial position.”

Eikenbary reported that Central’s direct written premiums increased from $500.7 million in 2012 to $533.7 million in 2013, mostly thanks to an 11.4 percent increase in commercial lines writings. Personal lines business also saw an increase of 3.9 percent.  The company’s combined ratio for 2013 improved significantly to 91.8 percent as compared to 103.5 percent in 2012.

Net investment income for the company decreased by $1.1 million from $38.8 million in 2012 to $37.7 million in 2013.

“While still a challenge in the current interest rate environment, income from Central’s investment portfolio continues to be a positive and very consistent contributor to the entire operation,” said Eikenbary.

Central’s bond portfolio increased in by 4.4 percent during 2013.  The quality of the portfolio remained very solid and Central continued to manage the maturity of the portfolio to ensure that it maintained the liquidity necessary to meet the company’s financial needs.  Central’s stock portfolio represented 18.1 percent of the company’s total invested assets.

Central registered a net income after taxes and dividends of $74.7 million in 2013, a significant increase over 2012.  This was the result of a net underwriting gain of $32 million coupled with the company’s positive investment returns.

Central’s assets increased by 6 percent to $1.39 billion, and by the end of 2013, the company’s Policyholders’ Security Fund had also increased by nearly $109 million or 21.3 percent to $619.4 million, a record for the company.

In other business, Edd Buhl, senior vice president and secretary, read the minutes from the 138th Policyholders’ Meeting. Buhl was also re-elected to the Board of Directors. Other directors include Covington, T.B. Kearney, R.J. Kutella, D.P. Maconachy, E.J. Noonan, F.W. Purmort, and J.L. White.

Central Mutual Insurance Company is a personal and commercial property and casualty insurance company operating exclusively through independent insurance agents in eighteen states. The home office is located in Van Wert, with regional offices located in Dallas, Atlanta, Boston, and Van Wert.

POSTED: 06/04/14 at 12:29 am. FILED UNDER: Business