Conifer Holdings Inc reported third-quarter net income of $52.8 million, reversing a net loss of $2.7 million in the same period last year. The swing to profitability was driven by a $61 million gain from the August sale of its insurance agency operations.
Gross written premiums fell 60.9% to $15.1 million as the company scaled back its commercial lines business. Conifer noted that the decline is expected to continue, as business produced by the divested insurance agency operations will now be written by other carriers.
Net written premiums, however, rose to $11.2 million from $5.7 million a year ago. The company’s combined ratio deteriorated to 143.1 from 120.8 during the same period last year.
In a statement, CEO Brian Roney said the third-quarter results reflect the impact of the sale of its insurance agency operations to Bishop Street Underwriters.
Third quarter results reflect the successful culmination of the sale of our insurance agency operations to Bishop Street Underwriters. With the sale, and the majority of our commercial lines production in runoff, we are focusing underwriting efforts on select personal lines, particularly in Texas and Midwest homeowners,” Roney said.
Bishop Street Underwriters, a multi-boutique insurance platform, acquired Conifer’s managing general agent operations, Conifer Insurance Services, during the quarter.
Conifer also sold its remaining interest in Sycamore Specialty Underwriters LLC for $6.5 million, a transaction reported earlier this year.
In September, the transaction between Conifer Insurance Services (CIS) and Bishop Street Underwriters was officially revealed, with the latter formally entering the commercial lines MGA market through the acquisition.
“We are excited to add [CIS] to the Bishop Street platform as part of our strategic expansion. [CIS] has transitioned to a specialty MGA over the last year, and this strategic carrier carve-out will serve as a strong foundation that checks many boxes as our first commercial platform acquisition,” Bishop Street CEO Chad Levine said.
As part of the deal, Nick Petcoff joined as CIS’s new owner. Petcoff, CEO of the acquired MGA, expressed excitement on behalf of his team of more than 70 people.
“With [Bishop Street’s] strong backing of strategic partners and capital resources, we’re confident we can continue to exceed client expectations by delivering highly tailored insurance solutions and exceptional service,” he said.
“We are already working with Bishop Street to build in new underwriting technology capabilities as well as expand distribution and capacity for new programs and acquisitions we have on our radar.”
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