FPIC Results Pick Up: Fool by Numbers

On Feb. 16, FPIC Insurance Group (Nasdaq: FPIC  ) released fourth-quarter earnings for the period ended Dec. 31, 2006.

The quarter's expense ratio increased because of a levy of $4.7 million by the Florida Insurance Guaranty Association related to the bankruptcy of Poe Financial Group. This can later be recouped by FPIC.

• Although net income was flat, operating earnings (excluding realized gains and discontinued operations items) were up 25%.
• For the year, policy retention rates were strong at 94% in Florida and 92% nationwide.
• Favorable loss reserve development shaved 9.2% off the quarter's combined ratio, versus favorable development of 0.4% last year.
• FPIC has a four-star rating in Motley Fool CAPS. Tell us what you think about this company.

(Figures in thousands, except per-share data)

Income Statement Highlights

	Q4 2006	Q4 2005	% Change
Premiums Earned	$54,871	$63,984	(14.2%)
Investment Income	$8,848	$6,863	28.9%
Net Income	$9,431	$9,306	1.3%
EPS	$0.92	$0.90	2.2%

Get back to basics with a look at an insurer's income statement.

Ratio Checkup

	Q4 2006	Q4 2005	Change
Loss Ratio	56.6%	70.5%	(13.90%)
Expense Ratio	29.0%	16.8%	12.20%
Combined Ratio	85.6%	87.3%	(1.70%)

*Expressed in percentage points.

What do these ratios mean?

Balance Sheet Highlights

Assets	Q4 2006	Q4 2005	% Change
Investments	$865,997	$764,079	13.3%
Total Assets	$1,219,059	$1,308,541	(6.8%)

Liabilities
Gross Loss Expense Reserve	$642,955	$663,466	(3.1%)
Reserve, Net of Reinsurance	$484,087	$359,619	34.6%
Long Term Debt	$46,083	$46,083	0.0%

Learn your way around an insurer's balance sheet.

Related Companies:

• XL Capital (NYSE: XL  )
• AXIS Capital (NYSE: AXS  )
• Endurance Specialty Holding (NYSE: ENH  )
• Arch Capital Group (Nasdaq: ACGL  )
• St. Paul Travelers (NYSE: STA  )

Related Foolishness:

• Insurance Industry Basics: Premiums
• Insurance Industry Basics: Combined Ratio
• Insurance Industry Basics: Float

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.

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Fool contributor Emil Lee is an analyst and a disciple of value investing. Emil doesn't own shares in any of the companies mentioned above and appreciates hearing your comments, concerns, and complaints. The Motley Fool has a disclosure policy.