Central Insurance Companies - 2021 Annual Report

Photograph of Evan Purmort
Evan Purmort
CEO & President

Letter from the President

Central began as a company rooted in fulfilling the promise. Over the years, we have never wavered on that commitment. How we fulfill that promise has evolved and grown alongside the changing needs of our agents and policyholders, but we’ve never lost sight of the integrity, relationships and excellence that serve as our North Star.

The past few years have taught us all a lot about what’s possible when we come together to do hard things. The choices we make today have an impact on what tomorrow will look like for everyone. 2020 was a year of asking questions and listening to our agents. 2021 was a year of action and innovation fueled by the insights we gained from those conversations.

Last year, Central went all-in on aligning with our agency partners. And, the results speak for themselves. In commercial lines, new business grew steadily across each of our industry verticals with construction ending the year as our largest segment. In personal lines, we improved pricing and selection to achieve profitability.

Investments in developing world-class technology transformed the way we do business. Deeper levels of data continued to drive decisions around the ways we design and refine our products—positioning us to better serve our policyholders and deepening our relationships with those who matter most.

As always, we remain focused on growing in step with you, our agents, policyholders and key partners. Expect to see more exciting products and programs roll out throughout 2022, but rest assured this innovation comes without compromise. Excellence, hospitality and relationships will always be our primary focus. The trust you have placed in us inspired great things last year—and it will remain the core of a shared success story we’ll continue writing together in the years to come.

Evan Purmort
CEO & President

I want to leave behind something that lasts well beyond my time at Central. We have been provided the opportunity to make an impression on the company vision, but more importantly help cultivate our culture and values that extend beyond dollars and cents. I want to make sure we leave behind a legacy that is thriving for those who come after us, one they can build upon and move Central into the future.

Brandon Corum
^{Vice President — Personal Lines
and Small Commercial}

As a part of Central, we are stewards for the company. The things we do today are positioning the company for the generations that will follow. It’s our job to make sure we are innovating in ways that perpetuate Central’s ability to keep growing in the right way.

Jessica Pannkuk
^{Director of Claims Transformation}

Integrity and excellence keep us grounded and growing. The perfect integrity strategy is timeless—it was solid a hundred years ago and will still be good a hundred years from now. That's our solid foundation. Excellence is what drives us forward. It's a continually moving target that challenges us to do hard things, realigning, reimagining, and refocusing as we go.

Jason McConkey
^{Director of Transportation Underwriting}

A Fresh Look for a Bright Future

Central underwent its first brand refresh in nearly 40 years in 2021. Our new brand better reflects the story we are poised to tell about Central's innovative, collaborative future while staying true to our core values of relationships, excellence and integrity.

Central has 145 years of rich history, but our aesthetic didn't reflect our focus on embracing innovation and growth. The brand refresh doesn't change who we are as a company; it gives us a better way to share that story with the world.

Taylor Ray Orsbon
^{Director of Brand and Marketing Strategy}

Growth Rooted in Intention and Innovation

For Central, growth has never been about adding more agents; it's arming our existing agents with the right products to meet the evolving needs of our policyholders.

In 2020, we spent significant time talking with our partners to fully understand their wants. Across those conversations, a resonating theme emerged: our agents have a desire to go deeper with Central and a need for more products.

We took this feedback to heart in 2021, leveraging the specialized expertise of our vertical teams to drive innovation. Our new vertical directors are focused on enriching our growth strategy, and the direct impact of their efforts can already be seen in the form of increased profitability, thoughtful partnerships and exciting new product offerings.

Central is successful as a company, in large part due to relationships. There are larger insurance companies with more resources, but agents choose us because they know we care about their business and value our relationship with them.

James Barto
^{Vice President — Commercial Lines}

From Opportunity to Outcome

Commercial lines at Central grew by 15% last year, more than doubling the prior year's growth, while personal lines achieved profitability for the first time in several years.

Through a partnership with Tarmika, we streamlined and simplified the commercial lines quoting process for our agents. The package policy is now live and we plan to roll out our business auto policy later this spring.

Our Multivariate Rating Plan (MVP) for personal auto policies opened the door to deeper data insights that empower us to better evaluate risk and provide fairer pricing.

We revamped the tier structure on our Workers' Compensation dividend program to give underwriters more flexibility when addressing specific needs.

Through a partnership with CAPE Analytics, we're leveraging artificial intelligence and geospatial imagery to better select properties, evaluate risk, and streamline the underwriting process.

Success Rooted in Growing Together

Aligning with our agents has always been the core of Central’s growth strategy. From writing nearly $10 million in manufacturing new business to growing our construction book by nearly 30%, our vertical strategy resulted in impressive growth throughout 2021—and we’re just getting started.

We are focused on growing with our existing agents by giving them the tools and products they need to succeed. Central's integration with Tarmika was driven by listening to our agents, and it represents an important step towards the low-touch, high-tech future of small business insurance.

Anne Russo
^{Director of Small Business}

Leaving our Mark in 2021

From financial wins to exceptional customer service scores, Central's culture of care makes a difference—and the evidence is in our numbers.

Client Connection achieved $46 million in
written premium

Our Client Connection team surpassed its 2021 sales goal by over $1 million to achieve a total of $2 million in sales. This major accomplishment is a testament to the value our service center brings to our agents and policyholders throughout the year.

$1 billion in balance sheet strength

For the first time in our 145-year history, Central's Policyholders' Security Fund has reached the $1 billion mark. This milestone is not only an indicator of our ongoing financial health, but also our ability to fulfill our promises to agents and policyholders.

Excellence in the Experience

Last year, Central crossed over into next level hospitality by scoring a 4.9 rating on Google reviews. This accomplishment reflects our collective commitment to delivering on excellence with every claim.

Exceeding Expectations

Launching Net Promoter Score last year enabled us to dive deeper into the customer experience and adapt strategies around those insights. With an industry average of 0.57, our year-to-date Claims score of 0.77 reflects our dedication to exceeding expectations at every opportunity.

Fulfilling the Promise

Everyone at Central plays a pivotal role in delivering on our promise of excellence. Claims is where we bring it all home with heart, humanity and hospitality.

Claims hospitality is the commitment we make to our policyholders to resolve any claims—regardless of complexity—with understanding and integrity. Every claim is an opportunity to deliver on that promise and deepen our relationships with the people who place their trust in us each day.

Frankie Rodriguez
^{Claim Supervisor}

Success in Claims is based on understanding how our policyholders feel about the service they receive from Central. We care about their experience. The voices of Central policyholders and agents fuel our continual pursuit of excellence. By listening and truly understanding their needs, we are able to fulfill our promises better than anyone else.

We're called upon to be there for people during some of the most difficult moments of their lives. Read more about the impact of Central's response in these policyholder and agents stories:

Rising from the Ashes

After a routine morning mowing the lawn, Neal Swartz returned his lawnmower to the garage not knowing it would soon spark a devastating house fire. Within an hour, the family found themselves facing a total loss of their home of 40 years. One of the first calls they made on the path to restoring their lives was to Central.

A Cold Day in Texas

When Winter Storm Uri hit Texas last February, the state saw unprecedented losses resulting from damages including frozen pipes and collapsed roofs. While many other insurers waited to initiate a response, Central sprang into action, pulling together a rapid response team focused on helping our policyholders put the pieces back together again.

Everyone that called was so friendly and efficient. We have never received this kind of service from an insurance company before and are so glad we changed after dealing with a larger insurance company for so many years."

Alex N.

My experience could not have been better. Adjuster called in less than a minute after I reported the accident to my agent. I still didn't know how that happened."

Ronnie S.

Calls came from several departments wanting me to make sure that we were ok. Everyone I spoke with was so kind and helpful. I couldn't have asked for a better experience."

Susan G.

Great and expedient customer service. I always feel that I am being cared for."

Armando L.

I was prepared to wait several days before hearing from a representative, so I was completely surprised to get a call within hours."

Brad H.

This was the best group of people that I could have asked to work with. Every single person was caring, knowledgeable and supportive."

Lori B.

From my first phone call to Central Insurance I have been treated like royalty."

John C.

This is, by far, the best service I have ever had dealing with an insurance company. I am proud to be insured by such a great company."

Stephanie G.

Different by Design

Our values are only as good as how we live them out in practice. At Central, we seek to embody a culture of caring that supports our employees and communities.

Job Rotational Program

Central’s Job Rotational Program continues to support internal employee growth potential while fostering cross-department relationships, mentorship and collaboration. We currently have several employees participating in the program across multiple departments.

DEI

In 2021, we deepened our commitment to diversity, equity and inclusion by growing the DEI team to nine internal team members and a specialized consultant. Continuing education, policy updates and ongoing conversations are just a few of the ways we are enhancing our DEI initiatives and supporting a culture where everyone feels welcome and valued.

Angel Tree Tags

At Central, we believe doing good business includes doing good by others. This year, our employees raised $5,245 in support of The Salvation Army's Angel Tags initiative. With the company match, we collected a record-breaking $10,490, which our team members used to brighten the holidays for 77 local children and families.

United Way

As an extension of our ongoing commitment to relationships, our Central team is dedicated to giving back to the communities where we live and work. Each year, we hold a fundraising campaign to benefit the United Way. We're proud of the care our employees demonstrate throughout the year, and honored to support organizations doing important work locally.

InVEST

Central employees and retirees have been teaching InVEST at Van Wert High School for nearly a decade, with 19 students participating in the program in 2021. This unique, hands-on program is designed to educate high school and college students on insurance, financial services and risk management while encouraging them to pursue careers in the industry.

Scholarships

Central’s Educational & Charitable Foundation Scholarship Program benefits the residents of Van Wert and the surrounding area as an expression of our gratitude and appreciation for the support shown to us by the community. We have proudly awarded 89 students scholarships since the program launched in 2002.

Financial Report

Performance

Since 2018, Central's Combined Ratio has improved three full points to end 2021 at 100.9.

Consistency

After experiencing a slowdown in direct written premium driven by the pandemic in 2020, growth in 2021 rebounded and is up 3% over the prior year.

Strength

Central's Policyholders' Security Fund has grown notably, up over a quarter of a billion dollars or 35% over the past five years.

2021 Financial Report

Central Mutual and All America Insurance Companies ('Central')
December 31, 2021

Summarized Balance Sheet as of 12/31/2021	CENTRAL
Assets
Bonds	$1,314,977,545
Stocks	$368,271,889
Real Estate	$35,585,894
Cash & Short-Term Investments	$150,798,048
Agents' Balances & Uncollected Premiums	$238,938,618
All Other Assets	$50,391,042
Total Admitted Assets	$2,158,963,037
Liabilities & Policyholders' Security Fund
Losses & Loss Adjusting Expenses	$646,333,121
Unearned Premiums	$382,696,624
Commissions Payable & Contingent Commissions	$28,540,872
Ceded Reinsurance Premiums Payable	$4,471,335
Taxes and Other Liabilities	$92,507,287
Unassigned Funds (Policyholders' Security Fund)	$1,004,413,798
Total Liabilities & Policyholders' Security Fund	$2,158,963,037
Select Performance Measures
Total Central Assets	$2,158,963,037
Direct Written Premium	$790,262,312
Growth Rate in Direct Written Premium	3.0%
Combined Ratio – Central	100.9%
Policyholders' Security Fund	$1,004,413,798
Premium to Policyholders' Security Fund Ratio	0.72
A.M. Best Rating	A (Excellent)

Evolving through Expertise

2021 Annual Report

Evolving through
Expertise

2021 Annual Report

Letter from the President

A Fresh Look for a Bright Future

Growth Rooted in Intention and Innovation

From Opportunity to Outcome

Success Rooted in Growing Together

Leaving our Mark in 2021

Client Connection achieved $46 million in
written premium

$1 billion in balance sheet strength

Excellence in the Experience

Exceeding Expectations

Fulfilling the Promise

Rising from the Ashes

A Cold Day in Texas

Different by Design

Job Rotational Program

DEI

Angel Tree Tags

United Way

InVEST

Scholarships

Financial Report

Performance

Consistency

Strength

2021 Financial Report

Assets

Liabilities & Policyholders' Security Fund

Select Performance Measures

Letter from the President

A Fresh Look for a Bright Future

Growth Rooted in Intention and Innovation

From Opportunity to Outcome

Success Rooted in Growing Together

Leaving our Mark in 2021

Client Connection achieved $46 million inwritten premium

$1 billion in balance sheet strength

Excellence in the Experience

Exceeding Expectations

Fulfilling the Promise

Rising from the Ashes

A Cold Day in Texas

Different by Design

Job Rotational Program

DEI

Angel Tree Tags

United Way

InVEST

Scholarships

Financial Report

Performance

Consistency

Strength

2021 Financial Report

Assets

Liabilities & Policyholders' Security Fund

Select Performance Measures

Client Connection achieved $46 million in
written premium