Kingstone Companies, Inc · NASDAQ:KINS
Kingstone Companies — New York State Society of Security Analysts presentation (March 2016)
24 slides from Kingstone Companies's conference presentation, Mar 21, 2016
Slide 1: Presentation to New York State Society of Security Analysts
Presentation to New York State Society of Security Analysts March 21,2016 ner er RR Barry Goldstein-Chief Executive Officer
Slide 2: Forward Looking Statements
Forward Looking Statements This document contains forward-looking statements and management may make additional forward looking statements in response to your questions. Forward-looking statements include statements regarding the intent, belief or current expectations of the Company and its manageme
Slide 3: Kingstone's CEO - Barry Goldstein
————— sn Kingstone’s CEO— Barry Goldstein * KINS Chairman and CEO for 15 years Kingstone Insurance Company Chairman for 10 years Kingstone Insurance Company CEO for 5 years * Company's Largest Shareholder KINGSTONE :
Slide 4: Experienced Management Team - Aligned with Shareholders
Experienced Management Team— Aligned with Shareholders Directors and senior management own approximately 29% of shares outstanding John Reiersen Benjamin Walden Sei nso. ese Executive Vice President ele Chief Financial Officer = Chairman and Chief a Former CEO thru 2011 - Joined Kingstone “S Joined
Slide 5: Kingstone - Who are we?
Kingstone— Who are we? A130 year old New York domiciled P & C carrier demutualized in 2009 Multi-line provider of personal and commercial lines Focused on the needs of the smaller independent agencies 97% of our risks are located in NYC, Long Island and Westchester Flat management structure allows f
Slide 6: Where are we now?
Where are we now? $63,026,000 2015 Return on Average Common Equity 16.2% KINGSTONE ,
Slide 7: Where are we going?
Where are we going? * Our goal is to be rated as “A-Excellent” by A.M. Best * We will remain focused on writing those personal lines and main street type commercial risks needed by the smaller sized agencies * Now growing Commercial Lines: Artisan and BOP coverages * Increasing distribution in NYS -
Slide 8: The Kingstone Financial History - The Past Five Years
The Kingstone Financial History-The Past Five Years Key Financial Metrics 2011 2012 2013 2014 2015 Gross Premium Written Growth 22.5% 20.9% 22.8% 26.1% 26.3%) Combined Ratio inclusive of all 74.8% 93.9% 88.6% 77.1% 80.0% weather events Book Value per Share $4.07 $4.24 $4.91 $5.54 $6.18 Dividends per
Slide 9: Distribution and Underwriting Core Values Require:
Distribution and Underwriting Core Values Require: * Consistency: We are consistent in servicing our agents, who are essential in sustaining our success * Commitment: Larger carriers are less committed to servicing smaller sized agents (our core) + Respect: We support only the independent agent netw
Slide 10: Balance Sheet Protection & Reinsurance as Capital Management Tool
Balance Sheet Protection & Reinsurance as Capital Management Tool + Net premium written-to-Surplus: Maintain at approximately 1.5:1 + No single after-tax|oss greater than 1% of surplus * No catastrophe loss more than 5% of surplus, net of tax * Organic growth and acquisitions can be facilitated via
Slide 11: The Kingstone Investment Opportunity
a The Kingstone Investment Opportunity Transformation Since Demutualization in 2009: Focused on alignment of Management, Employees and Shareholder Interests + Management owns 29% of the company + Asignificant portion of management's net worth in Kingstone stock + CEOis company's largest shareholder
Slide 12: Cultural Transformation - Mutual Culture Transformed into ROE/Growth Focus
Cultural Transformation — Mutual Culture Transformed into ROE/Growth Focus In 2009, Kingstone management inherited a high fixed cost laden mutual culture. The following has helped Kingstone gain 400 basis points of margin in the past 5 years. * Digital Streamlining: Moved to a fully digital approach
Slide 13: Leveraging Our Efficiency
Leveraging Our Efficiency + Inapplying a more efficient approach, Kingstone has nearly doubled its average written premium per employee. Premium growth rate far exceeds growth in employee count. Engen wre an Pt 26,966,000 710,000 2010 43 33,260,000 773,000 2011 49 40,746,000 832,000 2012 3 49,276,00
Slide 14: Agency Relationships - The Life Blood of Kingstone
Agency Relationships — The Life Blood of Kingstone ‘Smaller Agents Are Kingstone’s core 100% of our business is generated via relationships with 350+ independent agents Most of our agents produce less than $1 million annually in commissions Kingstone treats its agents as customers: We listen : We le
Slide 15: Agent Selection & Relationship Building - Essential To Kingstone's Success
Agent Selection & Relationship Building— Essential To Kingstone’s Success Differentiated fromcompetition by the following approach: 1. Multiple product lines geared toward our producers’ needs 2. Consistent market presence and rate levels 3, Transparentand uniform commission structure and profit sha
Slide 16: Business Mix and By-Line Profitability
Business Mix and By-Line Profitability + Approximately 97% of all policies in Downstate New York (NYC / Long Istand/Westchester) + Primarily homeowners and dwelling coverages- over % of total policies in force * Actively writing coastal exposed risks, home and business * The bookis evolving and dive
Slide 17: Kingstone's Core Profitability Exceptional, Focus on Risk Management
Kingstone’s Core Profitability Exceptional, Focus on Risk Management With a heavy weighting of homeowners insurance, Kingstone spends extensive time and resources managing its catastrophe risk while simultaneously growingits core business. Asa result: * Core profitability is Excellent: Including San
Slide 18: Catastrophe Management: Not A Balance Sheet Event
Catastrophe Management: Not A Balance Sheet Event Actual Sandy Direct Loss in 2012 of $18.0M would be equal to a $38.0M loss today | ct on Full Year Combined Rati Dollar Impact of Sandy-Type Event on mpact on Full Year Compiny "0 ae of Sandy-Type Event Pre-Tax Underwriting Results idy-Typ 6 $5.58M 2
Slide 19: Who Is The Competition & How Do We Successfully Compete
Who Is The Competition & How Do We Successfully Compete + Whoisthe competition? Examples include: 1. The Mutuals-New York Central, Utica and Security 2. The Giants-Travelers, State Farm and Allstate 3. The Monolines-Narragansett Bay, Ocean Harbor and U.S. Coastal + Howdo we compete against these com
Slide 20: We Hit 'Em Where They Ain't - The Kingstone Approach To Target Business
ld Eis We Hit ‘Em Where They Ain’t— The Kingstone Approach To Target Business Kingstone’s opportunities for growth come fromthe following sources: + Feedback from agents regarding underserved markets, competitor changes and product upgrades + Further leveraging relationships with its strongest agent
Slide 21: Kingstone - Conscientiously Addressing Business & Shareholder Risk
Kingstone— Conscientiously Addressing Business & Shareholder Risk KINGSTONE
Slide 22: Why Should I Own Kingstone?
Why Should | Own Kingstone? + Ourcore strength is servicing smaller agents, which leads toa very profitable relationship for the agent and Kingstone + Sustainable growth rate is 5xindustry’s average + Sustainable ROE well above industry averages * Conservative balance sheet and catastrophe exposure
Slide 23: Our History - KINS and Kingstone Insurance Company
a Our History-KINS and Kingstone Insurance Company * Originally an owner/franchisor of retail insurance agencies (ka DCAP Group) * Acquired ownership of Commercial Mutual in 2009 upon its demutualization * Sold distribution business-sole focus nowas an underwriter 1885 2009 2013 ‘Commercial Mutual ‘
Slide 24: Contact Us
KINGSTONE Contact Us For Additional information Investor Relations At The Company The Equity Group Amanda Goldstein ‘Adam Prior Investor Relations Director Senior Vice President agoldstein@kingstonecompanies.com aprior@equityny:com
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