Proassurance Corp (PRA) SEC Filing 10-Q Quarterly Report for the period ending Thursday, September 30, 2021

Proassurance Corp

CIK: 1127703 Ticker: PRA

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Ken McEwen
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ProAssurance Reports Results for Second Quarter 2021
BIRMINGHAM, AL – (BUSINESSWIRE) – August 5, 2021 – ProAssurance Corporation (NYSE: PRA) reports net income of $92.1 million, or $1.70 per diluted share, and operating income
(1) of $26.6 million, or $0.49 per diluted share, for the three months ended June 30, 2021. We will timely file our quarterly report on Form 10-Q on or before August 9, 2021.
(1)Operating income is a Non-GAAP financial measure. See a reconciliation of net income to Non-GAAP operating income under the heading “Non-GAAP Financial Measures” that follows.
Highlights - Second Quarter 2021(2)
Consolidated net income includes a $74.4 million gain on bargain purchase related to the acquisition of NORCAL, partially offset by $20.3 million of pre-tax transaction-related costs
Excluding the gain on bargain purchase, transaction-related costs, and the related tax effects, net income was $34.1 million, or $0.63 per diluted share
Consolidated combined ratio, excluding transaction-related costs, of 99.9%
Profitability in all segments, driven by:
Top line growth in all segments except the Lloyd’s Syndicates segment
$11.9 million in equity in earnings of unconsolidated subsidiaries in our Corporate segment
$4.3 million result from our Lloyd’s Syndicates segment
Strong rate gains and stabilizing retention in the Specialty Property & Casualty (“Specialty P&C”) segment
Steady profitability in the Workers’ Compensation Insurance segment
28.1 point improvement in the consolidated current accident year net loss ratio
Includes improvements in the Specialty P&C and Lloyd’s Syndicates segments (48.3 and 27.5 points, respectively)
$1.89 increase in book value per share from March 31, 2021 (includes $1.38 per share from the gain on bargain purchase)
(2) Comparisons to the second quarter of 2020, except book value per share
Management Commentary & Results of Operations
“Closing the NORCAL transaction was the beginning of a transformative event for ProAssurance,” said President and Chief Executive Officer Ned Rand. “We have made excellent early progress with our integration plan. While the operating environment remains uncertain, as we and others in our industry seek to better understand the long-term impacts of the pandemic and navigate the current loss environment in the healthcare professional liability (“HCPL”) marketplace, we are encouraged by these results and look forward to the remainder of 2021.”
Higher net income included a strong performance from our investments in various LPs and LLCs; improvement in the results of our Specialty P&C, Workers’ Compensation Insurance, and Lloyd’s Syndicates segments; and the introduction of NORCAL’s financial results into our consolidated reporting. Excluding transaction-related costs, our combined ratio was 99.9%.
Consolidated gross premiums written increased quarter-over-quarter due to top line growth in each of our underwriting segments with the exception of Lloyd’s, driven primarily by a 32.7% increase in our Specialty P&C segment. This increase reflects the acquisition of NORCAL and underlying premium growth in the ProAssurance legacy book as a result of our re-underwriting and rate strengthening efforts.
Our consolidated net loss ratio decreased 25.7 points from the year ago quarter driven by improvement in the current accident year net loss ratios for the Specialty P&C and Lloyd’s Syndicates segments (48.3 and 27.5 loss ratio points, respectively), offset slightly by increases in the Workers’ Compensation Insurance and Segregated Portfolio Cell Reinsurance (“SPCR”) segments.
The consolidated expense ratio increased in the second quarter driven by transaction-related costs of $20.3 million associated with our acquisition of NORCAL. Excluding these one-time costs, our expense ratio was 23.8%. For reporting purposes, these costs are only included in our consolidated operating expenses and are not allocated to any one segment.
Our consolidated net investment result increased due to higher reported earnings from investments in LPs/LLCs. This increase was partially offset by a decrease in net investment income, reflective of lower yields on our corporate debt securities and short-term investments resulting from the current low interest rate environment.
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The following information was filed by Proassurance Corp (PRA) on Thursday, August 5, 2021 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside this 10-Q Quarterly Report

Cover Page
Condensed Consolidated Balance Sheets (Unaudited)
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical)
Condensed Consolidated Statements Of Cash Flows (Unaudited)
Condensed Consolidated Statements Of Changes In Capital (Unaudited)
Condensed Consolidated Statements Of Income And Comprehensive Income (Unaudited)
Basis Of Presentation
Basis Of Presentation (Narrative) (Details)
Basis Of Presentation (Other Liabilities) (Details)
Basis Of Presentation (Policies)
Basis Of Presentation (Premium Receivable Expected Credit Losses) (Details)
Basis Of Presentation (Tables)
Benefit Plans
Benefit Plans (Components Of Net Periodic Benefit Cost Credit) (Details)
Benefit Plans (Narrative) (Details)
Benefit Plans (Tables)
Business Combination
Business Combination ( Pro Forma And Actual Consolidated Results) (Details)
Business Combination ( Schedule Of Present Value Of Future Insurance Profits Expected Amortization) (Details)
Business Combination (Narrative) (Details)
Business Combination (Schedule Of Recognized Identified Assets Acquired And Liabilities Assumed) (Details)
Business Combination (Summary Of Intangible Assets Acquired) (Details)
Business Combination (Tables)
Commitments And Contingencies
Commitments And Contingencies (Details)
Debt (Details)
Debt (Narrative) (Details)
Debt (Tables)
Earnings (Loss) Per Share
Earnings (Loss) Per Share (Details)
Earnings (Loss) Per Share (Tables)
Fair Value Measurement
Fair Value Measurement (Assets Measured At Fair Value) (Details)
Fair Value Measurement (Financial Instruments Not Measured At Fair Value) (Details)
Fair Value Measurement (Investments In Llcs And Limited Partnerships Footnote) (Details)
Fair Value Measurement (Investments In Llcs And Limited Partnerships) (Details)
Fair Value Measurement (Level 3 Assets And Liability) (Details)
Fair Value Measurement (Narrative) (Details)
Fair Value Measurement (Quantitative Information Regarding Level 3 Valuations) (Details)
Fair Value Measurement (Tables)
Goodwill (Narrative) (Details)
Goodwill (Schedule Of Goodwill) (Details)
Goodwill (Tables)
Income Taxes
Income Taxes (Details)
Investments (Available-For-Sale Fixed Maturities) (Details)
Investments (Available-For-Sale Securities By Contractual Maturity) (Details)
Investments (Credit Losses Related To Debt Securities) (Details)
Investments (Equity In Earnings (Loss) Of Unconsolidated Subsidiaries) (Details)
Investments (Investments Held In A Loss Position) (Details)
Investments (Narrative) (Details)
Investments (Net Investment Income) (Details)
Investments (Net Realized Investment Gains (Losses)) (Details)
Investments (Roll Forward Of Cumulative Credit Losses Recorded In Earnings) (Details)
Investments (Sales And Purchases Of Available-For-Sale Securities) (Details)
Investments (Tables)
Investments (Unconsolidated Subsidiaries) (Details)
Leases (Future Minimum Lease Payments) (Details)
Leases (Lease Cost) (Details)
Leases (Narrative) (Details)
Leases (Supplemental Lease Information) (Details)
Leases (Tables)
Reserve For Losses And Loss Adjustment Expenses
Reserve For Losses And Loss Adjustment Expenses (Details)
Reserve For Losses And Loss Adjustment Expenses (Tables)
Retroactive Insurance Contracts
Retroactive Insurance Contracts (Details)
Segment Information
Segment Information (Financial Data By Segment) (Details)
Segment Information (Gross Premiums Earned And Reconciliation To Net Premiums) (Details)
Segment Information (Narrative) (Details)
Segment Information (Tables)
Shareholders' Equity
Shareholders' Equity (Narrative) (Details)
Shareholders' Equity (Roll Forward Of Aoci) (Details)
Shareholders' Equity (Tables)
Variable Interest Entities
Variable Interest Entities (Narrative) (Details)

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Proassurance Corp provided additional information to their SEC Filing as exhibits

Ticker: PRA
CIK: 1127703
Form Type: 10-Q Quarterly Report
Accession Number: 0001875246-21-000007
Submitted to the SEC: Mon Nov 08 2021 4:23:54 PM EST
Accepted by the SEC: Mon Nov 08 2021
Period: Thursday, September 30, 2021
Industry: Fire Marine And Casualty Insurance

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