Kingstone Companies, Inc · NASDAQ:KINS
Kingstone Companies — New York State Society of Security Analysts presentation, March 2017
25 slides from Kingstone Companies's conference presentation, Mar 22, 2017
Slide 1: Presentation to New York State Society of Security Analysts
Presentation to New York State Society of Security Analysts March vals 2017 eee 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: The Kingstone Financial History - The Past Five Years
The Kingstone Financial History-The Past Five Years Combined Ratio inclusive of all 93.9% 88.6% 77.1% 80.0% 79.2% weather events Gross Premium Written Growth Rate 20.9% 22.8% 26.1% 23.9%) 13.4% Operating Income (624,672, 701,537} §,111,93]] 7,210,808} 9,760,302) Investment Income 1,303,224 1,745,84.
Slide 4: Kingstone's CEO - Barry Goldstein
SS Kingstone’s CEO— Barry Goldstein * KINS Chairman and CEO for 16 years Kingstone Insurance Company Chairman for 11 years Kingstone Insurance Company CEO for 6 years + Company's Largest Shareholder KINGSTONE
Slide 5: Experienced Management Team - Aligned with Shareholders
Experienced Management Team— Aligned with Shareholders Benjamin Walden Victor Brodsky Chairman, President & Chief Executive Officer Executive Vice President & Chief Actuary Chief Financial Officer SVP & Head of Business Development * Chairman and Chief Executive Officer since 2001 + 20 years of expe
Slide 6: Kingstone - Who are we?
Kingstone— Whoare we? KINGSTONE :
Slide 7: Where are we now?
Where are we now? Closing Price on March 16, 2017 $15.00 Outstanding Shares Post Follow-on Offering 10,621,367 Market Capitalization $159,320,000 2016 Earnings Per Share (diluted) $114 Book Value per Share $8.19 Pro-Forma post Follow-on Offering Annualized dividend $.25 Price to book—Pro-forma 1.8%
Slide 8: 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 * Actively seeking opportunities t
Slide 9: What will an "A" Rating Mean for Kingstone?
What will an “A” Rating Mean for Kingstone? KINGSTONE :
Slide 10: Common Stock Offerings - Past Five Years
Common Stock Offerings - Past Five Years Dateof Offering SE sae December 2013 3,450,000 $5.95 Underwritten Public Offering Sandler O'Neill + Partners, L.P. April 2016 595,238 $8.40 Private placement — Renaissance Re January— February 2017 2,692,500 $12.00 Underwritten Public Offering + Sandler O'Nei
Slide 11: Distribution and Underwriting Core Values Require:
Distribution and Underwriting Core Values Require: * Consistency: We are consistentin 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 netwo
Slide 12: 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 or less + No single after-tax oss greater than 1% of surplus * No catastrophe loss more than 5% of surplus, net of tax * Kingstone views reinsurance as an important com
Slide 13: The Kingstone Investment Opportunity
>> > SSS = —________ Iz The Kingstone Investment Opportunity ‘Transformation Since Demutualization in 2009: Focused on alignment of Management, Employees and Shareholder Interests + Asignificant portion of management's net worth in Kingstone stock + CEOis company’s largest shareholder + Employee bon
Slide 14: 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 370 basis points of margin in the past 5 years. * Digital Streamlining: Moved to a fully digital approach
Slide 15: Leveraging Our Efficiency
SS 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, even as we prepare for our Northeast expansion Ene on wen ree Pero 26,966,000 710,000 2010 43 33,260,0
Slide 16: 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 :
Slide 17: 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 18: 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 ts catastrophe risk while simultaneously growing its core business. Asa result: * Core profitability is Excellent: Including Sup
Slide 19: 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 $43.5M loss today Dollar Impact of Sandy-Type Event on Impact on Full Year Combined Ratio Pre-Tax Underwriting Results of Sandy-Type Event $5.58M. 755 5 $4.35M. 4 2 7.8% o 0.86 Sandy Impa
Slide 20: 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-Liberty, New York Central, Utica and Security 2. The Giants-Travelers, State Farm, Nationwide and Alllstate 3. The Monolines-Narragansett Bay, Ocean Harbor, Interboro and U.S. Coastal + H
Slide 21: We Hit 'Em Where They Ain't - The Kingstone Approach To Target Business
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 agents (existing
Slide 22: Kingstone - Conscientiously Addressing Business & Shareholder Risk
Kingstone— Conscientiously Addressing Business & Shareholder Risk
Slide 23: Why Should I Own Kingstone?
Why Should | Own Kingstone? + Ourcore strength is servicing smaller agents, which leads to a very profitable relationship for the agent and Kingstone + Sustainable growth rate is 4x industry's average + Sustainable ROE well above industry averages * Conservative balance sheet and catastrophe exposur
Slide 24: Our History - KINS and Kingstone Insurance Company
>> > SSS = —________ Iz Our History-KINS and Kingstone Insurance Company * Originally an owner/franchisor of retail insurance agencies (fka DCAP Group) * Acquired ownership of Commercial Mutual in 2009 upon its demutualization * Sold distribution business-sole focus now as an underwriter 2013 1886 P
Slide 25: Contact Us
Contact Us For Additional information At The Company Amanda M. Goldstein
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