State Auto Financial Corporation (NASDAQ: STFC) today reported a third quarter 2011 net loss of $58.7 million, or $1.46 per diluted share, versus net income of $0.2 million, or $0.00 per diluted share, for the third quarter of 2010. Net loss from operations* per diluted share for the third quarter 2011 was $1.62, versus a net loss of $0.04 for the same 2010 period. Included in third quarter results was a charge related to the deferred tax asset valuation allowance in the amount of $28.9 million, or $0.72 per share.
STFC’s GAAP combined ratio for the third quarter 2011 was 122.4 versus 105.9 for the third quarter of 2010. Catastrophe losses for the third quarter 2011 accounted for 17.0 points of the total 88.4 loss ratio points, or $60.8 million, versus 7.5 points of the total 73.1 loss ratio, or $23.7 million, for the same period in 2010.
Net written premium for the third quarter of 2011 increased 6.8% over the same period in 2010. The Rockhill unit, which is in the intercompany reinsurance pooling arrangement in 2011, contributed 7.4 points to this growth. For the third quarter of 2011, net written premium for the personal and business insurance segments declined 3.8% and 0.8%, respectively, compared to the same period in 2010. Net written premium for the specialty insurance segment increased $32.7 million compared to the same period in 2010. STFC’s book value was $14.94 per share as of Sept. 30, 2011, a decrease of $1.83 per share from STFC’s book value on June 30, 2011. Book value per share as of Sept. 30, 2011 has been reduced by $3.58 for a deferred tax asset valuation allowance. Return on stockholders’ equity for the 12 months ended Sept. 30, 2011 was negative 29.0% compared to 0.2% for the 12 months ended Sept. 30, 2010.
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