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National General Holdings Corp. Reports Second Quarter 2020 Results

NEW YORK, July 31, 2020 (GLOBE NEWSWIRE) -- National General Holdings Corp. (Nasdaq: NGHC) reported second quarter 2020 net income of $157.6A million or $1.37 per diluted share, compared to net income of $69.0A million or $0.60 per diluted share in the second quarter of 2019. Second quarter 2020 operating earnings (non-GAAP)(1) were $157.6A million or $1.36 per diluted share compared to $78.1A million or $0.67 per diluted share in the second quarter of 2019.
Second Quarter 2020 Highlights versus Second Quarter 2019*

Gross written premium grew by $50.4 million to $1,243.2A million compared to the prior yeara??s quarter due to our P&C segment growth of 3.2%, driven by the acquisition of National Farmers Union Property and Casualty Company (a??Farmers Union Insurancea??) in the third quarter of 2019, and organic growth, largely offset by the premium refund provided due to lower miles driven as a result of the COVID-19 pandemic; and our A&H domestic segment growth of 20.2%, excluding our previously sold A&H international business.





The overall combined ratio(11,12) was 80.5% compared to 90.9% in the prior yeara??s quarter, excluding non-cash amortization of intangible assets. The P&C segment reported an improved combined ratio to 83.6% from 92.6% in the prior yeara??s quarter driven by our continued strong underwriting and recent declines in miles driven. The P&C combined ratio includes prior year unfavorable loss development of $8.6 million compared to $10.4 million unfavorable loss development in the prior yeara??s quarter, and $35.3A million of catastrophe losses related to weather-related events compared to $18.4A million of catastrophe losses in the prior yeara??s quarter. The A&H segment reported a decrease in the combined ratio to 65.0% from 82.6% in the prior yeara??s quarter, driven by strong operating results in our small group self-funded and individual products, absence of our international business which was sold in the fourth quarter of 2019, and growth in service and fee income of 51.3%. The A&H combined ratio includes $11.4 million of favorable loss development compared to $8.1 million of favorable loss development in the prior yeara??s quarter.





Stockholdersa?? equity was $3.0 billion and fully diluted book value per share was $22.02 at JuneA 30, 2020, growth of 13.0% and 15.5%, respectively, from DecemberA 31, 2019. Excluding accumulated other comprehensive income, fully diluted book value per share was $20.40 at JuneA 30, 2020, growth of 10.7%, from December 31, 2019. Our trailing twelve-month operating return on average equity (ROE)(13) was 18.1% as of JuneA 30, 2020.





Second quarter of 2020 operating earnings (non-GAAP)(1) excludes the following, net of tax: $0.1A million loss on equity method investments, $4.4 million or $0.04 per share of net gain on investments and $4.2A million or $0.04 per share of non-cash amortization of intangible assets.





Repurchased 459,083 shares during the second quarter of 2020 as part of our share repurchase program.





Agreement announced on July 7, 2020 to be acquired by Allstate for expected total consideration of $34.50 per share cash (consisting of $32.00 in cash and an up to $2.50 per share closing dividend), subject to shareholder and regulatory approval and other customary closing conditions.

Barry Karfunkel, National Generala??s CEO, stated: a??Our well diversified platform continues to perform well. With our recently announced agreement to be acquired by Allstate, we look forward to contributing to the greater Allstate. I want to personally thank each and every one of the National General team members for their outstanding and continued work during these unprecedented times and for their continuing contribution to the success of the pending acquisition.a??*NOTE: Unless specified otherwise, discussion of our second quarter 2020 and 2019 results do not include financial results from the Reciprocal Exchanges, which are presented within our consolidated financial results within this release but are not included in net income available to NGHC common stockholders.
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