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Filing at a Glance

Company: Hallmark National Insurance Company

Product Name: KY HNIC 032414

State: Kentucky

TOI: 19.0 Personal Auto

Sub-TOI: 19.0001 Private Passenger Auto (PPA)

Filing Type: Rate

Date Submitted: 04/02/2014

SERFF Tr Num: PHXN-129481156

SERFF Status: Closed-Acknowledged

State Tr Num:

State Status: Filing Closed

Co Tr Num: KYHNIC032414

Effective DateRequested (New):

03/24/2014

Effective DateRequested (Renewal):

05/23/2014

Author(s): Ed Stokes

Reviewer(s): Jeff Lamb (primary)

Disposition Date: 04/10/2014

Disposition Status: Acknowledged

Effective Date (New): 03/24/2014

Effective Date (Renewal): 05/23/2014

State Filing Description:

SERFF Tracking #: PHXN-129481156 State Tracking #: Company Tracking #: KYHNIC032414

State: Kentucky Filing Company: Hallmark National Insurance Company

TOI/Sub-TOI: 19.0 Personal Auto/19.0001 Private Passenger Auto (PPA)


Project Name/Number: KYHNIC032414/KYHNIC032414

PDF Pipeline for SERFF Tracking Number PHXN-129481156 Generated 04/14/2014 10:10 AM

General Information

Company and Contact

Filing Fees

Project Name: KYHNIC032414 Status of Filing in Domicile: Not Filed

Project Number: KYHNIC032414 Domicile Status Comments:

Reference Organization: Reference Number:

Reference Title: Advisory Org. Circular:

Filing Status Changed: 04/10/2014

State Status Changed: 04/10/2014 Deemer Date:

Created By: Ed Stokes Submitted By: Ed Stokes

Corresponding Filing Tracking Number:

Filing Description:

Rate revision impacting base rates, territory factors and paid in full discount. Use and File with a new business effective date of3/24/14 and a renewal effective date of 5/23/14.

Filing Contact InformationEd Stokes, Senior Product Manager [email protected]

6500 Pinecrest Dr, St3 100

Plano, TX 75024

469-298-5846 [Phone]

Filing Company InformationHallmark National InsuranceCompany

6500 Pinecrest Dr #100

Frisco, TX 75024

(800) 486-5616 ext. [Phone]

CoCode: 19530

Group Code:

Group Name:

FEIN Number: 31-1334827

State of Domicile: Ohio

Company Type:

State ID Number:

Fee Required? Yes

Fee Amount: $5.00

Retaliatory? No

Fee Explanation: $5.00 per use and file rate filing less than -/+ 25% in a 12 month period.

Per Company: Yes

Company Amount Date Processed Transaction #Hallmark National Insurance Company $5.00 04/02/2014 80895174







Correspondence Summary DispositionsStatus Created By Created On Date SubmittedAcknowledged Jeff Lamb 04/10/2014 04/10/2014







Disposition

Disposition Date: 04/10/2014

Effective Date (New): 03/24/2014

Effective Date (Renewal): 05/23/2014

Status: Acknowledged

Comment:

Company

Name:

Overall %

Indicated

Change:

Overall %

Rate

Impact:

Written Premium

Change for

this Program:

Number of Policy

Holders Affected

for this Program:

Written

Premium for

this Program:

Maximum %

Change

(where req'd):

Minimum %

Change

(where req'd):Hallmark NationalInsurance Company

12.200% 12.000% $422,266 2,468 $3,562,647 22.100% 2.800%

Schedule Schedule Item Schedule Item Status Public AccessSupporting Document Actuarial Memorandum (if applicable) Yes

Supporting Document Histogram (if applicable) Yes

Supporting Document Filing Fee Yes

Supporting Document LC-1 P&C (8/00) Calculation of Loss Cost Multiplier (ifapplicable)

Yes

Supporting Document LC-2 P&C (8/00) Expense Constant Supplement (ifapplicable)

Yes

Supporting Document SG-1 Synopsis for Personal Auto-Rate Comparisons Yes

Supporting Document Third Party Authorization (if applicable) Yes

Rate KY Rate Supplement Yes







Rate Information Rate data applies to filing.

Filing Method: Use and File

Rate Change Type: Increase

Overall Percentage of Last Rate Revision: 7.830%

Effective Date of Last Rate Revision: 09/23/2013

Filing Method of Last Filing: Use and File

Company Rate Information

Company

Name:

Overall %

Indicated

Change:

Overall %

Rate

Impact:

Written Premium

Change for

this Program:

Number of Policy

Holders Affected

for this Program:

Written

Premium for

this Program:

Maximum %

Change

(where req'd):

Minimum %

Change

(where req'd):Hallmark NationalInsurance Company

12.200% 12.000% $422,266 2,468 $3,562,647 22.100% 2.800%







Rate/Rule Schedule

Item

No.

Schedule Item

Status Exhibit Name Rule # or Page # Rate Action

Previous State

Filing Number Attachments1 KY Rate Supplement 1 Replacement PHXN-129197999 KY HNIC Rate

Supplement.pdf







Hallmark National Insurance Company Hallmark National Insurance Company Hallmark National Insurance Company

Kentucky Kentucky Kentucky

New Business Effective: 3/24/2014 New Business Effective: 9/23/2013

Renewals Effective: 5/23/2014 Renewals Effective: 11/22/2013

Base Rates Base Rates Base Rates

HNIC BI PD MP UM UIM PIP OTC COL HNIC BI PD MP UM UIM PIP OTC COL HNIC BI PD MP UM UIM PIP OTC COL

All 254.94 198.52 15.00 58.20 27.91 241.84 249.43 460.24 All 254.94 192.74 15.00 54.39 27.91 230.32 249.43 460.24 All 0.0% 3.0% 0.0% 7.0% 0.0% 5.0% 0.0% 0.0%

Surcharge and Discount Factors Surcharge and Discount Factors Surcharge and Discount Factors

Discounts & Surcharges BI PD MP UM UIM PIP OTC COL Discounts & Surcharges BI PD MP UM UIM PIP OTC COL Discounts & Surcharges BI PD MP UM UIM PIP OTC COL

Paid In Full Discount 0.950 0.950 1.000 1.000 1.000 0.950 0.950 0.950 Paid In Full Discount 0.900 0.900 1.000 1.000 1.000 0.900 0.900 0.900 Paid In Full Discount 5.6% 5.6% 0.0% 0.0% 0.0% 5.6% 5.6% 5.6%

Territory Factors Territory Factors Territory Factors

Territory BI PD MP UM UIM PIP OTC COLL Territory BI PD MP UM UIM PIP OTC COLL Territory BI PD MP UM UIM PIP OTC COLL

1 2.594 2.770 1.000 1.124 1.000 3.023 1.117 1.482 1 2.545 2.574 1.000 1.050 1.000 2.885 1.117 1.482 1 1.9% 7.6% 0.0% 7.0% 0.0% 4.8% 0.0% 0.0%

2 1.079 1.225 1.000 1.083 1.000 1.197 0.707 0.912 2 1.109 1.180 1.000 1.012 1.000 0.998 0.707 0.912 2 -2.7% 3.8% 0.0% 7.0% 0.0% 19.9% 0.0% 0.0%

3 1.119 1.187 1.000 1.017 1.000 1.075 0.665 0.967 3 1.098 1.089 1.000 0.950 1.000 1.026 0.665 0.967 3 1.9% 9.0% 0.0% 7.1% 0.0% 4.8% 0.0% 0.0%

4 1.195 1.238 1.000 1.029 1.000 1.403 1.130 1.220 4 1.117 1.041 1.000 0.962 1.000 1.243 1.130 1.220 4 7.0% 18.9% 0.0% 7.0% 0.0% 12.9% 0.0% 0.0%

5 1.202 1.117 1.000 1.124 1.000 1.335 0.804 1.322 5 1.180 1.025 1.000 1.050 1.000 1.214 0.804 1.322 5 1.9% 9.0% 0.0% 7.0% 0.0% 10.0% 0.0% 0.0%

6 2.740 1.900 1.000 1.176 1.000 3.165 1.554 2.175 6 2.520 1.656 1.000 1.050 1.000 3.021 1.554 2.175 6 8.7% 14.7% 0.0% 12.0% 0.0% 4.8% 0.0% 0.0%

7 0.930 1.150 1.000 1.124 1.000 0.997 0.756 1.094 7 0.895 1.036 1.000 1.050 1.000 0.951 0.756 1.094 7 3.9% 11.0% 0.0% 7.0% 0.0% 4.8% 0.0% 0.0%

9 1.168 1.133 1.000 1.124 1.000 1.314 0.945 1.064 9 1.168 1.091 1.000 1.050 1.000 1.254 0.945 1.064 9 0.0% 3.8% 0.0% 7.0% 0.0% 4.8% 0.0% 0.0%

10 1.393 1.276 1.000 1.124 1.000 1.387 1.174 1.368 10 1.237 1.171 1.000 1.050 1.000 1.261 1.174 1.368 10 12.6% 9.0% 0.0% 7.0% 0.0% 10.0% 0.0% 0.0%

12 1.124 1.145 1.000 1.070 1.000 1.155 1.200 1.200 12 0.998 0.998 1.000 1.000 1.000 1.082 1.200 1.200 12 12.6% 14.7% 0.0% 7.0% 0.0% 6.7% 0.0% 0.0%

13 1.425 1.487 1.000 1.208 1.000 1.638 0.936 1.311 13 1.276 1.301 1.000 1.050 1.000 1.433 0.936 1.311 13 11.7% 14.3% 0.0% 15.0% 0.0% 14.3% 0.0% 0.0%

14 1.176 1.213 1.000 1.176 1.000 1.224 0.777 0.940 14 1.082 1.169 1.000 1.050 1.000 1.224 0.777 0.940 14 8.7% 3.8% 0.0% 12.0% 0.0% 0.0% 0.0% 0.0%

15 1.377 1.323 1.000 1.208 1.000 1.449 0.900 1.300 15 1.257 1.158 1.000 1.050 1.000 1.268 0.900 1.300 15 9.5% 14.2% 0.0% 15.0% 0.0% 14.3% 0.0% 0.0%

16 0.988 1.057 1.000 1.150 1.000 1.079 0.696 0.876 16 0.970 0.993 1.000 1.027 1.000 0.945 0.696 0.876 16 1.9% 6.4% 0.0% 12.0% 0.0% 14.2% 0.0% 0.0%

17 1.250 1.238 1.000 1.124 1.000 1.348 0.741 1.007 17 1.110 1.157 1.000 1.050 1.000 1.226 0.741 1.007 17 12.6% 7.0% 0.0% 7.0% 0.0% 10.0% 0.0% 0.0%

18 1.507 1.516 1.000 1.082 1.000 1.476 0.855 1.007 18 1.317 1.300 1.000 1.050 1.000 1.308 0.855 1.007 18 14.4% 16.6% 0.0% 3.0% 0.0% 12.8% 0.0% 0.0%

27 1.406 1.338 1.000 1.124 1.000 1.103 0.775 1.192 27 1.314 1.228 1.000 1.050 1.000 1.053 0.775 1.192 27 7.0% 9.0% 0.0% 7.0% 0.0% 4.7% 0.0% 0.0%

28 1.359 1.202 1.000 1.124 1.000 1.424 0.892 1.235 28 1.359 1.158 1.000 1.050 1.000 1.246 0.892 1.235 28 0.0% 3.8% 0.0% 7.0% 0.0% 14.3% 0.0% 0.0%

29 1.413 1.294 1.000 1.124 1.000 1.596 1.197 1.550 29 1.321 1.128 1.000 1.050 1.000 1.330 1.197 1.550 29 7.0% 14.7% 0.0% 7.0% 0.0% 20.0% 0.0% 0.0%

30 1.550 1.357 1.000 1.124 1.000 1.777 1.231 1.414 30 1.448 1.245 1.000 1.050 1.000 1.502 1.231 1.414 30 7.0% 9.0% 0.0% 7.0% 0.0% 18.3% 0.0% 0.0%

31 1.435 1.398 1.000 1.050 1.000 1.662 1.129 1.345 31 1.435 1.218 1.000 1.050 1.000 1.511 1.129 1.345 31 0.0% 14.8% 0.0% 0.0% 0.0% 10.0% 0.0% 0.0%

32 1.990 2.063 1.000 1.124 1.000 2.045 0.828 1.163 32 1.953 1.893 1.000 1.050 1.000 1.704 0.828 1.163 32 1.9% 9.0% 0.0% 7.0% 0.0% 20.0% 0.0% 0.0%

33 1.007 1.189 1.000 1.124 1.000 1.055 0.636 1.049 33 0.969 1.036 1.000 1.050 1.000 0.960 0.636 1.049 33 3.9% 14.8% 0.0% 7.0% 0.0% 9.9% 0.0% 0.0%

34 1.049 1.126 1.000 1.124 1.000 1.150 0.787 1.016 34 0.981 0.982 1.000 1.050 1.000 0.972 0.787 1.016 34 6.9% 14.7% 0.0% 7.0% 0.0% 18.3% 0.0% 0.0%

35 1.057 1.250 1.000 1.050 1.000 1.218 1.092 1.164 35 1.057 1.032 1.000 1.050 1.000 1.030 1.092 1.164 35 0.0% 21.1% 0.0% 0.0% 0.0% 18.3% 0.0% 0.0%

36 1.070 1.134 1.000 1.017 1.000 1.240 0.936 1.322 36 1.000 1.040 1.000 0.950 1.000 1.048 0.936 1.322 36 7.0% 9.0% 0.0% 7.1% 0.0% 18.3% 0.0% 0.0%

39 1.149 1.180 1.000 1.122 1.000 1.212 0.746 0.893 39 1.056 1.083 1.000 1.002 1.000 1.102 0.746 0.893 39 8.8% 9.0% 0.0% 12.0% 0.0% 10.0% 0.0% 0.0%

49 1.292 1.191 1.000 1.124 1.000 1.437 0.945 1.206 49 1.268 1.093 1.000 1.050 1.000 1.197 0.945 1.206 49 1.9% 9.0% 0.0% 7.0% 0.0% 20.1% 0.0% 0.0%

50 1.327 1.269 1.000 1.124 1.000 1.448 1.068 1.379 50 1.240 1.165 1.000 1.050 1.000 1.225 1.068 1.379 50 7.0% 8.9% 0.0% 7.0% 0.0% 18.2% 0.0% 0.0%

51 1.382 1.280 1.000 1.124 1.000 1.468 0.945 1.320 51 1.292 1.175 1.000 1.050 1.000 1.334 0.945 1.320 51 7.0% 8.9% 0.0% 7.0% 0.0% 10.0% 0.0% 0.0%

52 1.311 1.429 1.000 1.050 1.000 1.442 0.855 1.007 52 1.311 1.245 1.000 1.050 1.000 1.219 0.855 1.007 52 0.0% 14.8% 0.0% 0.0% 0.0% 18.3% 0.0% 0.0%

53 2.187 1.553 1.000 1.176 1.000 2.456 1.416 2.086 53 2.051 1.425 1.000 1.050 1.000 2.233 1.416 2.086 53 6.6% 9.0% 0.0% 12.0% 0.0% 10.0% 0.0% 0.0%

54 2.715 2.770 1.000 1.176 1.000 3.628 1.117 1.482 54 2.666 2.451 1.000 1.050 1.000 3.463 1.117 1.482 54 1.8% 13.0% 0.0% 12.0% 0.0% 4.8% 0.0% 0.0%

55 2.232 2.139 1.000 1.260 1.000 2.454 0.828 1.163 55 2.083 1.893 1.000 1.050 1.000 2.147 0.828 1.163 55 7.2% 13.0% 0.0% 20.0% 0.0% 14.3% 0.0% 0.0%

98 2.910 3.040 1.250 1.250 1.250 3.602 1.850 2.860 98 2.910 2.690 1.250 1.250 1.250 3.430 1.850 2.860 98 0.0% 13.0% 0.0% 0.0% 0.0% 5.0% 0.0% 0.0%

Supporting Document Schedules Satisfied - Item: Actuarial Memorandum (if applicable)Comments:Attachment(s): Indications - 2013m12 Kentucky HNIC.pdfItem Status:Status Date:

Satisfied - Item: Histogram (if applicable)Comments:Attachment(s): KY HNIC Histogram.pdfItem Status:Status Date:

Satisfied - Item: Filing FeeComments: This form is not required for EFT transmissions.Attachment(s):Item Status:Status Date:

Satisfied - Item: LC-1 P&C (8/00) Calculation of Loss Cost Multiplier (if applicable)Comments: Not ApplicableAttachment(s):Item Status:Status Date:

Satisfied - Item: LC-2 P&C (8/00) Expense Constant Supplement (if applicable)Comments: Not ApplicableAttachment(s):Item Status:Status Date:

Satisfied - Item: SG-1 Synopsis for Personal Auto-Rate ComparisonsComments: An updated shopper's guide has been submitted to the KY DOI's website under transaction number 512025.Attachment(s):Item Status:Status Date:







Satisfied - Item: Third Party Authorization (if applicable)Comments: This company is an independent filer of rates.Attachment(s):Item Status:Status Date:







Hallmark National Insurance Company

STATE OF Kentucky SUMMARY

BI PD MED UMBI CUST UIMBI PIP COMP COLL TOW RENT TOTAL

Base Rate 0.0% 3.0% 0.0% 7.0% 0.0% 0.0% 5.0% 0.0% 0.0% 0.0% 0.0% 2.3%

Territory 9.2% 9.8% 0.0% 8.8% 0.0% 0.0% 12.0% 0.0% 0.0% 0.0% 0.0% 9.2%

PIF Discount 0.3% 0.6% 0.0% 0.0% 0.0% 0.0% 0.2% 0.2% 0.2% 0.0% 0.0% 0.3%

EARNED PREMIUM $1,268,704 $873,980 $30 $62,272 $193 $26,866 $1,013,126 $95,974 $219,359 $1,965 $178 $3,562,647

INDICATED CHANGE 9.5% 13.3% 23.9% 16.8% 0.0% -3.8% 18.4% 1.3% -1.3% -2.0% 1472.3% 12.2%

TOTAL PROPOSED CHANGE 9.5% 13.4% 0.0% 15.8% 0.0% 0.0% 17.8% 0.2% 0.2% 0.0% 0.0% 12.0%

Indicated Proposed

TOTAL LIABILITY 13.3% 13.2%

TOTAL PHYSICAL DAMAGE 0.3% 0.2%

OVERALL CHANGE 12.2% 12.0%

1 18 4/1/2014 1:08 PM Indications - 2013m12 Kentucky HNIC FINAL version 8 ECS.xlsx SUMMARY

Hallmark National Insurance CompanyKentucky Premium Trend

1/1/2011 TO 12/31/2013

Including ExpensesPremium Trend Selection

0 0 0 0 0 0 0.02 0.02

Loss Period 1 BI PD MED UM UMPD UIM COMP COLL

Loss Year 10/1/08 - 9/30/09 10/1/08 - 9/30/09 10/1/08 - 9/30/09 10/1/08 - 9/30/09 10/1/08 - 9/30/09 10/1/08 - 9/30/09 10/1/08 - 9/30/09 10/1/08 - 9/30/09Avg DOL 4/1/2009 4/1/2009 4/1/2009 4/1/2009 4/1/2009 4/1/2009 4/1/2009 4/1/2009

New rate effective date 4/1/2014 4/1/2014 4/1/2014 4/1/2014 4/1/2014 4/1/2014 4/1/2014 4/1/2014

Duration of new rates 12 Months 12 Months 12 Months 12 Months 12 Months 12 Months 12 Months 12 MonthsLast DOL in new rates 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015Avg DOL in new rates 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015Trend Period 69 Months 69 Months 69 Months 69 Months 69 Months 69 Months 69 Months 69 MonthsAnnual Loss Trend Selected 1.000 1.000 1.000 1.000 1.000 1.000 1.020 1.020

Trend for Period 1.000 1.000 1.000 1.000 1.000 1.000 1.121 1.121


Loss Year 10/1/09 - 9/30/10 10/1/09 - 9/30/10 10/1/09 - 9/30/10 10/1/09 - 9/30/10 10/1/09 - 9/30/10 10/1/09 - 9/30/10 10/1/09 - 9/30/10 10/1/09 - 9/30/10Avg DOL 4/1/2010 4/1/2010 4/1/2010 4/1/2010 4/1/2010 4/1/2010 4/1/2010 4/1/2010New rate effective date 4/1/2014 4/1/2014 4/1/2014 4/1/2014 4/1/2014 4/1/2014 4/1/2014 4/1/2014Duration of new rates 12 Months 12 Months 12 Months 12 Months 12 Months 12 Months 12 Months 12 MonthsLast DOL in new rates 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015Avg DOL in new rates 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015Trend Period 57 Months 57 Months 57 Months 57 Months 57 Months 57 Months 57 Months 57 MonthsAnnual Loss Trend Selected 1 1 1 1 1 1 1.02 1.02

Trend for Period 1.000 1.000 1.000 1.000 1.000 1.000 1.099 1.099


Loss Year 10/1/10 - 9/30/11 10/1/10 - 9/30/11 10/1/10 - 9/30/11 10/1/10 - 9/30/11 10/1/10 - 9/30/11 10/1/10 - 9/30/11 10/1/10 - 9/30/11 10/1/10 - 9/30/11Avg DOL 4/1/2011 4/1/2011 4/1/2011 4/1/2011 4/1/2011 4/1/2011 4/1/2011 4/1/2011New rate effective date 4/1/2014 4/1/2014 4/1/2014 4/1/2014 4/1/2014 4/1/2014 4/1/2014 4/1/2014Duration of new rates 12 Months 12 Months 12 Months 12 Months 12 Months 12 Months 12 Months 12 MonthsLast DOL in new rates 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015Avg DOL in new rates 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015Trend Period 45 Months 45 Months 45 Months 45 Months 45 Months 45 Months 45 Months 45 MonthsAnnual Loss Trend Selected 1 1 1 1 1 1 1.02 1.02

Trend for Period 1.000 1.000 1.000 1.000 1.000 1.000 1.077 1.077

Note: All trand factors other than Medical Payments are based on 4th Quarter ISO Fast Track trend data. Medical Payments is based on the March2011 Medical Consumer Price Index.

Loss Year 1 10/1/2008 9/30/2009 4/1/200910/1/2009 9/30/2010 4/1/201010/1/2010 9/30/2011 4/1/2011

Medical Consumer Price Index = 0.019 source: www.bls.gov

Hallmark National Insurance CompanyCalculation of Kentucky Indicated Rate Change

Indication calculated using Hallmark Financial Loss Development Factors and Credibility methodology

1/1/2011 to 12/31/2013

A B C D E F G H I J K U V L M N O P Q R S

Earned Developed Trended Trended Loss & LAE

Factor to Premium at Incurred Incurred Loss Incurred Incurred Ratio Permissible Claims Permissible Cred. Wtd. Selected

Accident Written Earned Current Premium Current Losses IBNR Losses & ALAE Trend Losses ULAE Losses Trended Loss & LAE AY Total In Exp. Loss & ALAE Total RateCoverage Year Ending Premium Premium Rate Level Trend Rate Level & ALAE Factor & ALAE Ratio Factor & ALAE EP*1.100 & LAE on Level Ratio Indications Weights Indication Period Credibility Ratio Indication Change

Bodily 12/31/2011 2,167,081 1,997,475 1.199 1.000 2,395,276 1,637,882 1.025 1,679,025 84.06% 1.147 1,926,627 199,747 2,126,375 88.77% 64.95% 36.68% 20.00% 171

Injury 12/31/2012 1,377,450 1,823,282 1.039 1.000 1,895,137 1,186,171 1.100 1,304,732 71.56% 1.103 1,439,447 182,328 1,621,775 85.58% 64.95% 31.76% 30.00% 126

12/31/2013 1,168,352 1,268,704 1.000 1.000 1,268,704 387,524 1.500 581,416 45.83% 1.061 616,730 126,870 743,600 58.61% 64.95% -9.76% 50.00% 68

Total 4,712,883 5,089,461 1.092 5,559,117 3,211,577 3,565,172 70.05% 1.061 3,982,803 508,946 4,491,750 80.80% 12.0% 365 58.03% 64.95% 9.5% 9.50%

Property 12/31/2011 1,569,652 1,458,788 1.261 1.000 1,839,384 1,058,500 1.005 1,063,797 72.92% 1.072 1,140,307 145,879 1,286,186 69.92% 64.95% 7.66% 20.00% 470

Damage 12/31/2012 968,409 1,294,978 1.108 1.000 1,434,855 834,399 1.015 846,960 65.40% 1.051 890,040 129,498 1,019,537 71.06% 64.95% 9.40% 30.00% 417

12/31/2013 807,348 873,980 1.063 1.000 929,344 527,030 1.150 606,114 69.35% 1.030 624,430 87,398 711,828 76.59% 64.95% 17.93% 50.00% 264

Total 3,345,409 3,627,746 1.159 4,203,582 2,419,929 2,516,871 69.38% 1.030 2,654,777 362,775 3,017,552 71.79% 64.95% 13.3% 1,151 100.00% 64.95% 13.3% 13.40%

MED 12/31/2011 146 114 1.000 1.000 114 1,028 1.000 1,028 897.84% 1.068 1,098 11 1,110 969.11% 64.95% 1392.12% 20.00% 6

12/31/2012 (3) 37 1.000 1.000 37 - 1.000 - 0.00% 1.048 - 4 4 10.00% 64.95% -84.60% 30.00% -

12/31/2013 41 30 1.000 1.000 30 - 1.200 - 0.00% 1.029 - 3 3 10.00% 64.95% -84.60% 50.00% 8

Total 184 182 1.000 182 1,028 1,028 565.91% 1.029 1,098 18 1,116 614.52% 64.95% 210.7% 14 11.36% 64.95% 23.9% 0.00%

UMBI 12/31/2011 119,557 135,602 1.104 1.000 149,656 84,250 1.025 86,366 63.69% 1.147 99,103 13,560 112,663 75.28% 64.95% 15.91% 20.00% 6

12/31/2012 64,263 84,032 1.087 1.000 91,310 77,060 1.100 84,762 100.87% 1.103 93,514 8,403 101,917 111.62% 64.95% 71.86% 30.00% 9

12/31/2013 58,100 62,272 1.061 1.000 66,044 58,082 1.500 87,142 139.94% 1.061 92,435 6,227 98,663 149.39% 64.95% 130.01% 50.00% 3

Total 241,920 281,907 1.089 307,009 219,392 258,271 91.62% 1.061 285,052 28,191 313,243 102.03% 64.95% 89.7% 18 12.89% 64.95% 16.8% 15.80%

GAP 12/31/2011 360 388 1.090 424 - 1.019 - 0.00% 1.147 - 39 39 9.17% 64.95% -85.88% 20.00% -

12/31/2012 262 283 1.027 291 - 1.073 - 0.00% 1.103 - 28 28 9.74% 64.95% -85.01% 30.00% -

12/31/2013 145 193 1.000 193 - 1.364 - 0.00% 1.061 - 19 19 10.00% 64.95% -84.60% 50.00% -

Total 767 865 1.050 908 - - 0.00% 1.061 - 86 86 9.53% 64.95% -85.0% - 0.00% 64.95% 6.1% 0.00%

UIMBI 12/31/2011 52,352 61,657 1.000 61,657 2,580 1.025 2,645 4.29% 1.072 2,835 6,166 9,001 14.60% 64.95% -77.52% 20.00% 8

12/31/2012 27,342 35,423 1.000 35,423 35,531 1.100 39,082 110.33% 1.051 41,070 3,542 44,613 125.94% 64.95% 93.91% 30.00% 10

12/31/2013 25,607 26,866 1.000 26,866 - 1.500 - 0.00% 1.030 - 2,687 2,687 10.00% 64.95% -84.60% 50.00% -

Total 105,301 123,947 1.000 123,947 38,111 41,727 33.67% 1.052 43,905 12,395 56,300 45.42% 64.95% -29.6% 18 12.89% 64.95% -3.82% 0.00%

PIP 12/31/2011 1,403,828 1,316,018 2.124 2,794,989 1,496,430 1.000 1,496,430 113.71% 1.036 1,549,575 131,602 1,681,177 60.15% 64.95% -7.39% 20.00% 292

12/31/2012 972,580 1,210,826 1.578 1,910,940 1,428,556 1.000 1,428,556 117.98% 1.025 1,464,616 121,083 1,585,698 82.98% 64.95% 27.76% 30.00% 240

12/31/2013 964,431 1,013,126 1.197 1,212,303 775,143 1.200 930,171 91.81% 1.015 944,191 101,313 1,045,503 86.24% 64.95% 32.78% 50.00% 103

Total 3,340,839 3,539,970 1.000 5,918,233 3,700,128 3,855,156 108.90% 1.027 3,958,381 353,997 4,312,378 72.87% 64.95% 23.2% 635 76.54% 64.95% 18.4% 17.82%

COMP 12/31/2011 178,072 190,684 1.176 1.071 240,253 116,405 1.000 116,405 61.05% 1.147 133,571 19,068 152,640 63.53% 64.27% -1.15% 20.00% 112

12/31/2012 112,875 143,484 1.083 1.050 163,264 116,828 1.000 116,828 81.42% 1.103 128,890 14,348 143,239 87.73% 64.27% 36.51% 30.00% 118

12/31/2013 90,032 95,974 1.065 1.030 105,258 35,097 1.050 36,852 38.40% 1.061 39,090 9,597 48,687 46.26% 64.27% -28.03% 50.00% 48

Total 380,978 430,142 1.183 508,775 268,330 270,085 62.79% 1.061 301,552 43,014 344,566 67.72% 64.27% -3.3% 278 50.64% 64.27% 1.3% 0.20%

COLL 12/31/2011 363,654 366,309 1.225 1.071 480,607 223,923 1.000 223,923 61.13% 1.036 231,876 36,631 268,507 55.87% 64.27% -13.07% 20.00% 141

12/31/2012 245,244 306,268 1.089 1.050 350,251 184,132 1.000 184,132 60.12% 1.025 188,780 30,627 219,407 62.64% 64.27% -2.53% 30.00% 99

12/31/2013 208,041 219,359 1.065 1.030 240,579 123,644 1.050 129,826 59.18% 1.015 131,782 21,936 153,718 63.90% 64.27% -0.58% 50.00% 77

Total 816,939 891,936 1.201 1,071,437 531,699 537,881 60.30% 1.015 552,438 89,194 641,632 59.89% 64.27% -3.7% 317 54.08% 64.27% -1.3% 0.20%

TOW 12/31/2011 2,596 2,489 1.000 2,489 45 1.000 45 1.81% 1.147 52 249 300 12.07% 64.27% -81.21% 20.00% 5

12/31/2012 2,183 2,505 1.000 2,505 150 1.000 150 5.99% 1.103 165 251 416 16.61% 64.27% -74.16% 30.00% 4

12/31/2013 1,858 1,965 1.000 1,965 300 1.050 315 16.03% 1.061 334 196 531 27.01% 64.27% -57.98% 50.00% 4

Total 6,637 6,959 - 6,959 495 510 7.33% 1.061 551 696 1,247 17.92% 64.27% -67.5% 13 10.95% 64.27% -2.0% 0.00%

RENT 12/31/2011 1,759 1,523 1.000 1,523 8,178 1.000 8,178 536.92% 1.147 9,384 152 9,536 626.10% 64.27% 874.18% 20.00% 51

12/31/2012 1,083 1,556 1.000 1,556 13,716 1.000 13,716 881.30% 1.103 15,133 156 15,288 982.30% 64.27% 1428.41% 30.00% 4

12/31/2013 71 178 1.000 178 10,639 1.050 11,171 6269.78% 1.061 11,849 18 11,867 6660.59% 64.27% 10263.59% 50.00% 16

Total 2,913 3,258 1.000 3,258 32,533 33,065 1014.99% 1.061 36,366 326 36,692 1126.32% 64.27% 5735.2% 71 25.59% 64.27% 1472.3% 0.00%

13.33% 13.19%

0.31% 0.20%

12.17% 12.03%

Accident Year Experience from

Liability Physical Damage

Commission and Brokerage 14.46% 14.50%

Other Acquisition Expense 9.70% 9.20%

General Expense 3.00% 3.00%

Taxes, Licenses, and Fees 6.55% 6.55%

Profit and Contingencies 4.00% 4.00%

Subtotal 37.71% 37.25%

Total 37.71% 37.25%

Less Investment Income Offset -2.66% -1.52%

35.05% 35.73%

Permissible Loss and LAE Ratio 64.95% 64.27%


DEVELOPMENT OF EXPECTED LOSS AND LOSS ADJUSTMENT RATIO


Any State Private Passenger Non-standard Auto

Incurred Losses (including expense) Through 12/31/2012Bodily Injury

Accident Incurred Incurred Incurred

Year Losses LDF Est Ultimate

2008 9,658,852 1.001 9,668,510

2009 11,342,878 1.006 11,410,992

2010 12,685,061 1.025 13,003,699

2011 11,793,220 1.100 12,971,985

2012 8,107,220 1.500 12,163,550

Total 53,587,231 59,218,737

AY Mos. Dev. 12 24 36 48 60 72 842006 2,535,650 3,100,224 3,402,511 3,512,503 3,642,839 3,714,287 3,161,1582007 4,419,134 6,255,711 6,962,999 7,365,495 7,650,804 6,542,878 2008 6,540,792 8,685,285 9,733,346 10,797,590 9,658,852 2009 6,449,351 8,739,381 11,121,102 11,342,878 2010 7,171,383 12,315,464 12,685,061 2011 9,757,004 11,793,220 2012 8,107,220

Link Ratios 12:24 24:36 36:48 48:60 60:72 72:84 84-ultimate2006 1.223 1.098 1.032 1.037 1.020 0.851 2007 1.416 1.113 1.058 1.039 0.855 2008 1.328 1.121 1.109 0.895 2009 1.355 1.273 1.020 2010 1.717 1.030 2011 1.209 2012

Average 1.375 1.127 1.055 0.990 0.937 0.851 --3 Yr Avg 1.463 1.151 1.065 0.990 0.937 0.851

X-min/max 1.330 1.110 1.045 1.037 CV 14% 8% 4% 8% 12% --

Selected 1.364 1.073 1.019 1.005 1.001 1.000 1.000 Cumulative 1.500 1.100 1.025 1.006 1.001 1.000 1.000

Property Damage

Through 12/31/2012Accident Incurred Incurred Incurred

Year Losses LDF Est Ultimate2008 9,905,768 1.000 9,905,768 2009 10,347,084 1.001 10,357,431 2010 12,304,789 1.005 12,366,362 2011 11,157,084 1.015 11,325,043 2012 8,847,740 1.150 10,175,399 Total 52,562,464 54,130,002

AY Mos. Dev. 12 24 36 48 60 72 842006 3,203,511 3,796,263 3,886,614 3,919,373 3,923,303 3,924,543 3,859,2372007 6,857,665 8,021,273 8,185,875 8,244,206 8,273,973 8,139,612 2008 8,605,665 9,579,330 9,874,554 9,968,255 9,905,768 2009 8,950,375 10,056,193 10,362,873 10,347,084 2010 10,721,328 12,135,348 12,304,789 2011 9,973,224 11,157,084 2012 8,847,740

Link Ratios 12:24 24:36 36:48 48:60 60:72 72:84 84-ultimate2006 1.185 1.024 1.008 1.001 1.000 0.983 2007 1.170 1.021 1.007 1.004 0.984

2008 1.113 1.031 1.009 0.994

2009 1.124 1.030 0.998

2010 1.132 1.014

2011 1.119

2012

Average 1.140 1.024 1.006 0.999 0.992 0.983 --

3 Yr Avg 1.125 1.022 1.004 0.999 0.992 0.983 X-min/max 1.136 1.025 1.008 1.001

CV 1% 1% 1% 1% 1% --

Selected 1.133 1.010 1.004 1.001 1.000 1.000 1.000

Cumulative 1.150 1.015 1.005 1.001 1.000 1.000 1.000

Through 12/31/2012

INCURRED LOSSES - BI

INCURRED LOSSES - PD



Incurred Losses (including expense) Through 12/31/2012

MED/PIP

Through 12/31/2012



2008 485,250 1.000 485,250

2009 719,871 1.000 719,871

2010 1,831,054 1.000 1,831,054

2011 2,402,504 1.000 2,402,504

2012 1,122,346 1.200 1,346,815

Total 6,561,025 6,785,494

AY Mos. Dev. 12 24 36 48 60 72 84

2006 188,361 145,886 125,651 122,439 122,439 122,439 122,072

2007 235,583 248,424 270,422 272,736 279,829 255,356

2008 334,073 498,707 507,907 514,427 485,250

2009 566,387 721,282 707,156 719,871

2010 1,567,515 2,004,331 1,831,054

2011 3,121,477 2,402,504

2012 1,122,346

Link Ratios 12:24 24:36 36:48 48:60 60:72 72:84 84-ultimate

2006 0.775 0.861 0.974 1.000 1.000 0.997

2007 1.055 1.089 1.009 1.026 0.913

2008 1.493 1.018 1.013 0.943

2009 1.273 0.980 1.018

2010 1.279 0.914

2011 0.770

2012

Average 1.107 0.972 1.003 0.990 0.956 0.997 --

3 Yr Avg 1.024 0.947 1.015 0.990 0.956 0.997

X-min/max 1.095 0.971 1.011 1.000

CV 27% 9% 2% 4% 6% --

Selected 1.200 1.000 1.000 1.000 1.000 1.000 1.000

Cumulative 1.200 1.000 1.000 1.000 1.000 1.000 1.000

Uninsured Motorist

Through 12/31/2012



2008 1,294,602 1.001 1,295,897

2009 1,143,969 1.006 1,150,839

2010 1,342,898 1.025 1,376,630

2011 929,054 1.100 1,021,915

2012 631,671 1.500 947,719

Total 5,342,194 5,793,000

AY Mos. Dev. 12 24 36 48 60 72 84

2006 301,753 435,893 465,276 514,084 489,511 513,319 511,641

2007 527,110 682,425 769,183 741,105 764,350 682,722

2008 521,540 783,526 1,319,853 1,386,649 1,294,602

2009 703,636 1,005,469 1,167,639 1,143,969

2010 915,587 1,200,683 1,342,898

2011 752,657 929,054

2012 631,671


2006 1.445 1.067 1.105 0.952 1.049 0.997

2007 1.295 1.127 0.963 1.031 0.893

2008 1.502 1.685 1.051 0.934

2009 1.429 1.161 0.980

2010 1.311 1.118

2011 1.234

2012

Average 1.369 1.232 1.025 0.972 0.971 0.997 --

3 Yr Avg 1.273 1.140 1.015 0.972 0.971 0.997 X-min/max 1.370 1.136 1.015 0.952

CV 8% 21% 6% 5% 11% --

Selected 1.364 1.073 1.019 1.005 1.001 1.000 1.000

Cumulative 1.500 1.100 1.025 1.006 1.001 1.000 1.000

INCURRED LOSSES - MED

INCURRED LOSSES - UM



Incurred Losses (including expense) Through 12/31/2012

Underinsured Motorist

Through 12/31/2012



2008 429,627 1.001 430,057

2009 367,776 1.006 369,985

2010 388,936 1.025 398,705

2011 425,339 1.100 467,853

2012 119,360 1.500 179,080

Total 1,731,038 1,845,680

AY Mos. Dev. 12 24 36 48 60 72 84

2006 61,963 52,148 30,376 55,573 60,078 73,369 55,281

2007 30,904 88,919 120,818 197,929 286,329 373,404

2008 102,263 366,020 382,012 425,834 429,627

2009 112,158 261,130 378,180 367,776

2010 164,886 379,805 388,936

2011 298,182 425,339

2012 119,360


2006 0.842 0.582 1.830 1.081 1.221 0.753

2007 2.877 1.359 1.638 1.447 1.304

2008 3.579 1.044 1.115 1.009

2009 2.328 1.448 0.972

2010 2.303 1.024

2011 1.426

2012

Average 2.226 1.091 1.389 1.179 1.263 0.753 --

3 Yr Avg 1.865 1.236 1.044 1.179 1.263 0.753

X-min/max 2.234 1.142 1.376 1.081

CV 44% 31% 30% 20% 5% --

Selected 1.364 1.073 1.019 1.005 1.001 1.000 1.000

Cumulative 1.500 1.100 1.025 1.006 1.001 1.000 1.000

Physical Damage

Through 12/31/2012



2008 7,005,160 1.000 7,005,160

2009 4,672,376 1.000 4,672,376

2010 3,441,215 1.000 3,441,215

2011 3,274,428 1.000 3,274,428

2012 2,657,630 1.050 2,790,511

Total 21,050,808 21,183,690

AY Mos. Dev. 12 24 36 48 60 72 84

2006 2,237,298 2,409,901 2,405,320 2,395,542 2,397,490 2,397,490 2,390,776

2007 5,870,327 5,960,590 5,954,068 5,948,683 5,947,891 5,937,958

2008 7,087,898 7,039,378 7,095,630 7,129,308 7,005,160

2009 4,458,433 4,630,986 4,694,149 4,672,376

2010 3,258,156 3,448,392 3,441,215

2011 3,425,349 3,274,428

2012 2,657,630


2006 1.077 0.998 0.996 1.001 1.000 0.997

2007 1.015 0.999 0.999 1.000 0.998

2008 0.993 1.008 1.005 0.983

2009 1.039 1.014 0.995

2010 1.058 0.998

2011 0.956

2012

Average 1.023 1.003 0.999 0.994 0.999 0.997 --

3 Yr Avg 1.007 1.006 1.000 0.994 0.999 0.997 X-min/max 1.026 1.002 0.998 1.000

CV 4% 1% 0% 1% 0% --

Selected 1.050 1.000 1.000 1.000 1.000 1.000 1.000

Cumulative 1.050 1.000 1.000 1.000 1.000 1.000 1.000

INCURRED LOSSES - UIM

INCURRED LOSSES - PHYSICAL DAMAGE


Explanation of Kentucky Indicated Rate Change

Accident Year Experience from

Column (C) and (D) are written and earned premium on an accident year basis, respectively.

Column (E), the factor to current rate level, is the number which brings the premium earned

during each year of the experience period to the current rate level. The parallelogram method

was used to calculate these on-level factors. Prior rate changes were used to determine

these on-level factors for each type of coverage. Assume all policies have a six-month term and

the premium writings are uniformly distributed. These factors are detailed on attached schedules.

Summary of prior rate revisions:

Date BI PD MED UMBI PIP UIMBI COMP COLL Overall

11/14/2011 16.75% 14.91% 0.00% 0.62% 17.06% 5.98% 10.11% 14.75% 16.34%

5/28/2012 3.00% 3.00% 0.00% 3.00% 50.00% 3.00% 0.00% 0.00% 13.92%

9/30/2013 0.00% 6.80% 0.00% 6.50% 21.30% 0.00% 7.00% 7.00% 7.80%

0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Column (F), earned premium at current rate level is found by multiplying Column (D) by (E).

Column (G), incurred losses and ALAE net salvage and subrogation.

Column (H), developed incurred losses and ALAE net of salvage and subrogation.

Column (I), loss and ALAE ratio, is equal to Column (H) divided by Column (D).

Column (J), the trend factors, are detailed on the trend exhibit attached.

Column (U), unallocated loss adjustment expense which is Column (D) *1.100

Column (K) = Column (H) x Column (J).

Column (V) = Column (K) + Column (U).

Column (L) = Column (V) divided by Column (F).

Column (M) = Permissable Loss Ratio

Column (N) = [Column (L) / Column (M)] - 1

Column (O) = Accident Year Weights

Column (P) = ["Year1" Column (N) * Column (O)] + ["Year2" Column (N) * Column (O)] + ["Year3" Column (N) * Column (O)]

Column (Q) = [Column (M) / 1,084]^1/2

Column (R) = [Column (P) * (Q) + (1-Q) * (T-1)] = Calculated Indicated Change

Column (S) is the selected rate change.

Column (T) is the complement of credibility which is one year of trend by coverage type.

TOTAL SUMMARY

NA

Peril Written Written Earned Earned Earned Claim Reserves Paid Paid Salvage Subro Total Frequency Severity Loss

Premium Car Years Premium Car Years Loss Ratio Count Expense Loss Loss Cost

BI 4,712,883 NA 5,089,461 - 63.10% 365 3,211,577 - 8,799 NA

PD 3,345,409 NA 3,627,746 - 66.71% 1,151 2,419,929 - 2,102 NA

MED 184 NA 182 - 565.91% 6 1,028 - 171 NA

UMBI 241,920 NA 281,907 - 77.82% 18 219,392 - 12,188 NA

UMPD - NA - - 0.00% - - - 0 NA

GAP 767 NA 865 - 0.00% - - - 0 NA

UNBI 105,301 NA 123,947 - 30.75% 18 38,111 - 2,117 NA

PIP 3,340,839 NA 3,539,970 - 104.52% 635 3,700,128 - 5,827 NA

COMP 380,978 NA 430,142 - 62.38% 278 268,330 - 965 NA

COLL 816,939 NA 891,936 - 59.61% 317 531,699 - 1,677 NA

TOW 6,637 NA 6,959 - 7.11% 13 495 - 38 NA

RENT 2,913 NA 3,258 - 998.67% 109 32,533 - 298 NA

TOTAL 12,954,770 NA 13,996,371 NA 74.47% 2,910 - - - - - 10,423,222 NA 3,582 NA


RELATIVITY COMPARISON FOR: Kentucky

COVERAGE 11/14/2011 5/28/2012 9/30/2013

Overall 16.34% 13.92% 7.80% 0.00% 0.00% 0.00%

BI 16.75% 3.00% 0.00% 0.00% 0.00% 0.00%PD 14.91% 3.00% 6.80% 0.00% 0.00% 0.00%MP 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

UMBI 0.62% 3.00% 6.50% 0.00% 0.00% 0.00%UMPD 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%UIMBI 5.98% 3.00% 0.00% 0.00% 0.00% 0.00%UIMPD 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

PIP 17.06% 50.00% 21.30% 0.00% 0.00% 0.00%TOW 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%RENT 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%Comp 10.11% 0.00% 7.00% 0.00% 0.00% 0.00%Coll 14.75% 0.00% 7.00% 0.00% 0.00% 0.00%

COVERAGE Prior 11/14/2011 5/28/2012 9/30/2013

BI 1.000 1.168 1.203 1.203 1.203 1.203 1.203 PD 1.000 1.149 1.184 1.264 1.264 1.264 1.264 Med 1.000 1.000 1.000 1.000 1.000 1.000 1.000 UMBI 1.000 1.006 1.036 1.104 1.104 1.104 1.104 UMPD 1.000 1.000 1.000 1.000 1.000 1.000 1.000 UIMBI 1.000 1.060 1.092 1.092 1.092 1.092 1.092 UIMPD 1.000 1.000 1.000 1.000 1.000 1.000 1.000 TOW 1.000 1.000 1.000 1.000 1.000 1.000 1.000 RENT 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Comp 1.000 1.101 1.101 1.178 1.178 1.178 1.178 Coll 1.000 1.148 1.148 1.228 1.228 1.228 1.228

CalendarYear Ending Prior 11/14/2011 5/28/2012 9/30/2013

12/31/2011 98.3% 1.7% 0.0% 0.0% 0.0% 0.0%12/31/2012 13.5% 52.0% 34.5% 0.0% 0.0% 0.0%12/31/2013 0.0% 0.0% 93.6% 6.4% 0.0% 0.0%

- -

Calendar Average Rate Level by Calender Year and CoverageYear BI PD MP UMBI UMPD UIMBI UIMPD PIP

12/31/2011 1.003 1.003 1.000 1.000 1.000 1.001 1.000 1.003 12/31/2012 1.157 1.141 1.000 1.016 1.000 1.063 1.000 1.350 12/31/2013 1.203 1.189 1.000 1.041 1.000 1.092 1.000 1.780

- - - - - - - - - - - - - - - - - -

Calendar On Level Factor by Calender Year and CoverageYear BI PD MP UMBI UMPD UIMBI UIMPD PIP

12/31/2011 1.199 1.261 1.000 1.104 1.000 1.090 1.000 2.124 12/31/2012 1.039 1.108 1.000 1.087 1.000 1.027 1.000 1.578 12/31/2013 1.000 1.063 1.000 1.061 1.000 1.000 1.000 1.197

- - - - - - - - - - - - - - - - - -

Notes: 1. Earned exposure distribution assumes six month policies.

Rate Level History - Impacts & Effective Dates

Cumulative Rate Level Factors ( Prior to =1.00)

Earned Exposures Distribution by Calendar Year


Kentucky

Private Passenger - Nonstandard Auto

PREMIUM ON LEVEL FACTORS

Hallmark National Insurance CompanyKentucky Trend

1/1/2011 TO 12/31/2013

Including Expenses


Loss Year 1/1/11 - 12/31/11 1/1/11 - 12/31/11 1/1/11 - 12/31/11 1/1/11 - 12/31/11 1/1/11 - 12/31/11 1/1/11 - 12/31/11 1/1/11 - 12/31/11 1/1/11 - 12/31/11Avg DOL 7/2/2011 7/2/2011 7/2/2011 7/2/2011 7/2/2011 7/2/2011 7/2/2011 7/2/2011


Duration of new rates 12 Months 12 Months 12 Months 12 Months 12 Months 12 Months 12 Months 12 Months

Last DOL in new rates 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015 10/3/2015

Avg DOL in new rates 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015 1/2/2015

Trend Period 42 Months 42 Months 42 Months 42 Months 42 Months 42 Months 42 Months 42 Months

Annual Loss Trend Selected 1.04 1.02 1.019 1.04 1.02 1.04 1.04 1.010

1.061 1.030 1.029 1.061 1.030 1.061 1.061 1.015

Trend for Period 1.147 1.072 1.068 1.147 1.072 1.147 1.147 1.036


Loss Year 1/1/12 - 12/31/12 1/1/12 - 12/31/12 1/1/12 - 12/31/12 1/1/12 - 12/31/12 1/1/12 - 12/31/12 1/1/12 - 12/31/12 1/1/12 - 12/31/12 1/1/12 - 12/31/12

Avg DOL 7/1/2012 7/1/2012 7/1/2012 7/1/2012 7/1/2012 7/1/2012 7/1/2012 7/1/2012







Trend for Period 1.103 1.051 1.048 1.103 1.051 1.103 1.103 1.025


Loss Year 1/1/13 - 12/31/13 1/1/13 - 12/31/13 1/1/13 - 12/31/13 1/1/13 - 12/31/13 1/1/13 - 12/31/13 1/1/13 - 12/31/13 1/1/13 - 12/31/13 1/1/13 - 12/31/13

Avg DOL 7/2/2013 7/2/2013 7/2/2013 7/2/2013 7/2/2013 7/2/2013 7/2/2013 7/2/2013







Trend for Period 1.061 1.030 1.029 1.061 1.030 1.061 1.061 1.015

Note: All trand factors other than Medical Payments are based on 4th Quarter ISO Fast Track trend data. Medical Payments is based on the March

2011 Medical Consumer Price Index.

Accident AccidentYear Claim Claim Claim Claim Claim Claim Year Claim Claim Claim Claim Claim Claim

Ending Freq. Severity Cost Freq. Average Cost Ending Freq. Severity Cost Freq. Average CostJun-10 0.60 18,978 114.06 3.6% 1.5% 5.1% Jun-10 3.02 2,768 83.52 3.8% 2.2% 6.1%Sep-10 0.61 19,053 116.36 4.6% 0.7% 5.4% Sep-10 3.04 2,781 84.46 2.9% 1.8% 4.7%Dec-10 0.62 18,331 113.56 4.0% -4.1% -0.3% Dec-10 3.03 2,727 82.69 0.2% -0.3% -0.1%Mar-11 0.64 18,093 114.96 5.7% -4.7% 0.8% Mar-11 3.00 2,732 81.97 -0.6% -1.3% -1.9%Jun-11 0.64 18,571 118.26 6.0% -2.1% 3.7% Jun-11 2.93 2,741 80.32 -2.9% -1.0% -3.8%Sep-11 0.64 18,602 119.31 5.0% -2.4% 2.5% Sep-11 2.88 2,754 79.44 -5.0% -1.0% -5.9%Dec-11 0.65 19,072 123.25 4.3% 4.0% 8.5% Dec-11 2.91 2,839 82.53 -4.1% 4.1% -0.2%Mar-12 0.65 18,915 122.80 2.2% 4.5% 6.8% Mar-12 2.94 2,856 83.90 -2.1% 4.5% 2.3%Jun-12 0.67 18,572 123.54 4.5% 0.0% 4.5% Jun-12 3.00 2,880 86.36 2.4% 5.1% 7.5%Sep-12 0.67 18,471 124.66 5.2% -0.7% 4.5% Sep-12 3.05 2,912 88.81 5.7% 5.7% 11.8%Dec-12 0.69 18,786 129.32 6.5% -1.5% 4.9% Dec-12 3.06 2,924 89.34 5.1% 3.0% 8.2%Mar-13 0.69 18,969 130.43 5.9% 0.3% 6.2% Mar-13 2.99 2,946 88.14 1.8% 3.2% 5.1%

Exponential Fit 4.9% 0.2% 5.1% Exponential Fit 0.0% 2.9% 2.9%

Selected Annual Trend 4.0% Selected Annual Trend 2.0%

Accident AccidentYear Claim Claim Claim Claim Claim Claim Year Claim Claim Claim Claim Claim Claim

Ending Freq. Severity Cost Freq. Average Cost Ending Freq. Severity Cost Freq. Average CostJun-10 5.72 1,181 67.58 -6.4% -10.3% -16.0% Jun-10 4.72 3,269 154.21 0.3% -1.0% -0.7%Sep-10 5.75 1,082 62.26 -6.1% -15.0% -20.2% Sep-10 4.74 3,271 155.00 0.2% -0.5% -0.3%Dec-10 5.75 1,041 59.80 1.9% -14.2% -12.6% Dec-10 4.71 3,196 150.56 -1.4% -2.5% -3.9%Mar-11 5.80 1,045 60.62 1.4% -11.6% -10.3% Mar-11 4.64 3,163 146.85 -1.6% -3.2% -4.8%Jun-11 5.92 1,136 67.24 3.5% -3.9% -0.5% Jun-11 4.56 3,215 146.58 -3.4% -1.6% -4.9%Sep-11 5.92 1,146 67.84 2.9% 5.9% 9.0% Sep-11 4.48 3,252 145.76 -5.4% -0.6% -6.0%Dec-11 5.91 1,218 71.94 2.8% 17.0% 20.3% Dec-11 4.49 3,369 151.33 -4.6% 5.4% 0.5%Mar-12 6.60 1,461 96.47 13.8% 39.8% 59.1% Mar-12 4.41 3,415 150.61 -5.0% 8.0% 2.6%Jun-12 7.97 1,754 139.84 34.7% 54.4% 108.0% Jun-12 4.51 3,449 155.42 -1.2% 7.3% 6.0%Sep-12 8.10 1,823 147.69 36.9% 59.1% 117.7% Sep-12 4.58 3,444 157.57 2.1% 5.9% 8.1%Dec-12 8.11 1,846 149.69 37.2% 51.6% 108.1% Dec-12 4.58 3,412 156.38 2.0% 1.3% 3.3%Mar-13 7.24 1,720 124.54 9.6% 17.7% 29.1% Mar-13 4.60 3,425 157.49 4.2% 0.3% 4.6%

Exponential Fit 15.0% 25.6% 44.4% Exponential Fit -1.4% 2.9% 1.5%

Selected Annual Trend 4.0% Selected Annual Trend 1.0%

AccidentYear Claim Claim Claim Claim Claim Claim

Ending Freq. Severity Cost Freq. Average CostJun-10 1.26 5,618 70.85 0.5% 11.6% 12.1%Sep-10 1.27 5,581 70.83 -1.5% 9.4% 7.7%Dec-10 1.29 5,290 68.36 1.0% 0.0% 1.0%Mar-11 1.32 5,097 67.07 5.6% -9.0% -3.9%Jun-11 1.27 5,079 64.38 0.5% -9.6% -9.1%Sep-11 1.22 5,110 62.50 -3.6% -8.5% -11.8%Dec-11 1.23 5,251 64.60 -4.8% -0.7% -5.5%Mar-12 1.23 5,260 64.64 -6.6% 3.2% -3.6%Jun-12 1.26 5,382 67.74 -0.7% 6.0% 5.2%Sep-12 1.30 5,374 69.85 6.3% 5.2% 11.8%Dec-12 1.27 5,587 70.73 2.9% 6.4% 9.5%Mar-13 1.25 5,675 70.88 1.6% 7.9% 9.7%

Exponential Fit -0.6% 0.9% 0.3%

Selected Annual Trend 1.0%

Notes: 1. Data from NAII Fast Track @ 2nd Quarter 2013.

2. UMBI (UMPD) trend estimated as equal to BI (PD) trend.

3. Exponential trend for latest 12 quarters using model: value=a*(quarter)^b.

Bodily Injury Property Damage% Chg. Prior Yr. % Chg. Prior Yr.


Kentucky

Private Passenger - Nonstandard Auto

ANNUAL LOSS TREND FACTORS

Comprehensive Collision% Chg. Prior Yr. % Chg. Prior Yr.

Personal Injury Protection% Chg. Prior Yr.

Enter information in steps 1-4. On level factor shown at step 5.

1. Enter data:

Company HNIC

State KY

LOB PPA

Coverage ANY

2. Enter calendar period earned premiums to be placed on level using

date format: mm/dd/yyyy.

From 1/1/2011

To 12/31/2011

3. Enter Policy term in days for all policies (e.g., 365).

Term 183

4. Enter rate level histroy dates and percent changes.

Note: The history should include all revisons dated 7/2/10 and subsequent.

Percent of

Rate Effective Date Impact Cal. Pd. EPChange (e.g.,mm/dd/yy) Percent from Revision

-- Prior 98.3%

1 11/14/2011 16.3% 1.7%

2 5/28/2012 13.9% 0.0%

3 9/30/2013 7.8% 0.0%

4 0.0%

5 0.0%

6 0.0%

7 0.0%

8 0.0%

9 0.0%

10 0.0%

100.0%

5. Calendar period EP on level factor: 1.425

Premium on Level Factor Calculator


1. Enter data:

Company HNIC

State KY

LOB PPA

Coverage Any



From 1/1/2012

To 12/31/2012


Term 183



Percent of


-- Prior 13.5%

1 11/14/2011 16.3% 52.0%

2 5/28/2012 13.9% 34.5%

3 9/30/2013 7.8% 0.0%

4 0.0%

5 0.0%

6 0.0%

7 0.0%

8 0.0%

9 0.0%

10 0.0%

100.0%




1. Enter data:

Company HNIC

State KY

LOB PPA

Coverage Any



From 1/1/2013

To 12/31/2013


Term 183



Percent of


-- Prior 0.0%

1 11/14/2011 16.3% 0.0%

2 5/28/2012 13.9% 93.6%

3 9/30/2013 7.8% 6.4%

4 0.0%

5 0.0%

6 0.0%

7 0.0%

8 0.0%

9 0.0%

10 0.0%

100.0%



HNIC

Investment Income Report

PPA PPA

Liability Phy Dam Total

Earned Premium - 2010 68,268,240 26,548,760 94,817,000

75,491,280 29,357,720 104,849,000 Direct WP

Reserve Balances 12/31/2010

Unearned Premium Reserve 28,326,240 11,015,760 39,342,000

Net Loss Reserve 42,778,080 16,635,920 59,414,000

Net ALE Reserve 9,654,480 3,754,520 13,409,000

Total Policyholders Funds 80,758,800 31,406,200 112,165,000

Reserve Balances 12/31/2009


Net Loss Reserve 35,461,440 13,790,560 49,252,000

Net ALE Reserve 7,777,440 3,024,560 10,802,000


Average Reserve Balances for Year 2010


Net Loss Reserve 39,119,760 15,213,240 54,333,000

Net ALE Reserve 8,715,960 3,389,540 12,105,500


Total Cash and Invested Assets

As of 12/31/2009 147,215,000

As of 12/31/2010 177,601,000

Average for Years 2009 and 2010 162,408,000

Investment Income - 2010

Net Investment Income Earned 5,331,000

Net Realized Capital Gains 1,953,000

Total Investment Income 7,284,000

Allocation to Policyholders Funds

Average Policyholder Funds 105,206,000

Average Cash and Invested Funds 162,408,000

% Inv Income Allocated to Policyholder Funds 64.78%

Inv Income Allocated to Policyholder Funds 4,718,490

Allocation Between Liab and Phy Damage

% of Average Policyholder Reserves 72.00% 28.00% 100.00%

Allocation of Investment Income 3,397,313 1,321,177 4,718,490

Investment Income as a % of Earned Premium 4.98% 4.98% 4.98%

Invest - Period 1

HNIC

Investment Income Report

PPA PPA

Liability Phy Dam Total

Earned Premium - 2009 61,595,280 23,953,720 85,549,000

57,882,960 22,510,040 80,393,000 Direct WP

Invest - Period 2

Loss Dates

Beginnig Date 1/1/2011

Ending Date 12/31/2013

State Kentucky

Loss Year Recap

Beginning Date Ending Dates Date Range

Year 1 1/1/2011 12/31/2011 1/1/11 - 12/31/11

Year 2 1/1/2012 12/31/2012 1/1/12 - 12/31/12

Year 3 1/1/2013 12/31/2013 1/1/13 - 12/31/13

Year 4 1/1/2014

15

REVISON IMPACT

The chart below details how the proposed overall rate increase will impact the current book including all rating

attributes. The highest single change will be 22.1%, the lowest will be 2.8%.

Indication Summary:

Policy Holder Impact - Histogram

Maximum Rate Impact

The highest rate impact is an increase of 22.1%. The policy has a single driver with 3 vehicles and an excluded spouse.

The coverage changes apply to BI, PD and PIP coverage, with the largest impact on PIP.

filing at a glance - ambest.com · ed stokes, senior product manager [email protected] 6500...

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