PROVIDING PEACE OF MIND AND PROTECTION DURING LIFE'S UNEXPECTED EVENTS.

Bringing Security to Our Customers Since 1935

For more than 80 years, Grange has been a source of protection, trust and stability for its customers. Today, combined with our affiliate Integrity Insurance, we offer customers auto, home, life and business insurance in 13 states. And because we believe that our customers deserve only the best counsel and partnership in making these decisions, we sell our products exclusively through Independent Agents.

Bringing Security to Our Customers Since 1935

For more than 80 years, Grange has been a source of protection, trust and stability for its customers. Today, combined with our affiliate Integrity Insurance, we offer customers auto, home, life and business insurance in 13 states. And because we believe that our customers deserve only the best counsel and partnership in making these decisions, we sell our products exclusively through Independent Agents.

Integrity Insurance Corporate Headquarters, Appleton, WI

Integrity Insurance Corporate Headquarters, Appleton, WI

A LEGACY OF PARTNERSHIP

FOCUSED ON A COLLABORATIVE, STRONG ENTERPRISE

Celebrating 15 years together in 2016, our affiliation with Integrity Insurance is stronger than ever. Combined, we offer financial stability and a strong market presence that provides more value to Independent Agents and policyholders.

Today, more than 4,600 agents proudly partner with Grange and Integrity throughout our 13-state footprint. In 2016, Integrity grew premium at double the industry average and enjoyed its fifth straight year of profitability and growth. We will continue to bring our combined power to bear for the good of our policyholders, agents and associates.

A LEGACY OF PARTNERSHIP

FOCUSED ON A COLLABORATIVE, STRONG ENTERPRISE

Celebrating 15 years together in 2016, our affiliation with Integrity Insurance is stronger than ever. Combined, we offer financial stability and a strong market presence that provides more value to Independent Agents and policyholders.

Today, more than 4,600 agents proudly partner with Grange and Integrity throughout our 13-state footprint. In 2016, Integrity grew premium at double the industry average and enjoyed its fifth straight year of profitability and growth. We will continue to bring our combined power to bear for the good of our policyholders, agents and associates.

COMMITTED. CONNECTED. PARTNERS.

We are Committed

With 50 years of an “A” Excellent Rating from A.M. Best and $2.6 billion in assets, Grange is a stable, reliable partner that makes decisions based on doing what’s right for our agents and customers.

We are Connected

And while we have the stability of a larger carrier, we’re still small enough to know our agents and their individual business needs. Whether it’s our easy-to-use online platforms, specialized claims representatives or dedicated underwriters, Grange is connected to its agents.

We are Partners

Grange Independent Agents get more than a carrier, they get a partnership. We respect the sacred relationship between agent and client, and that at each interaction, we represent our agents.

We are Committed

With 50 years of an “A” Excellent Rating from A.M. Best and $2.6 billion in assets, Grange is a stable, reliable partner that makes decisions based on doing what’s right for our agents and customers.

We are Connected

And while we have the stability of a larger carrier, we’re still small enough to know our agents and their individual business needs. Whether it’s our easy-to-use online platforms, specialized claims representatives or dedicated underwriters, Grange is connected to its agents.

We are Partners

Grange Independent Agents get more than a carrier, they get a partnership. We respect the sacred relationship between agent and client, and that at each interaction, we represent our agents.

“INSURANCE IS JUST A PROMISE

...and if I can make good on that promise, then that’s everything. And that’s one of the great things about Grange. They can make good on that promise they have for the customer as well as the agent.”

 – Dan Reid, Reid Insurance Agency

TRUSTED ADVISORS.

INDEPENDENT AGENTS ARE A VALUED SOURCE OF EXPERTISE AND EDUCATION

Grange understands and supports the relationship between an agent and their client, and believes this bond is an integral part of our short- and long-term strategy. That's why we build unique relationships that focus on the Ease of Doing Business® for our agents while remaining a stable, consistent partner.

With a long history of partnering with Independent Agents, Grange is big enough to offer the stability of a larger insurance carrier, but small enough to connect with our agents like a small business. We partner with only the best agencies and seek out their feedback to help us make important decisions. With each interaction, whether it’s service, claims or billing, we know we represent our agents to their clients.

INDEPENDENT AGENTS ARE A VALUED SOURCE OF EXPERTISE AND EDUCATION

Grange understands and supports the relationship between an agent and their client, and believes this bond is an integral part of our short- and long-term strategy. That's why we build unique relationships that focus on the Ease of Doing Business® for our agents while remaining a stable, consistent partner.

With a long history of partnering with Independent Agents, Grange is big enough to offer the stability of a larger insurance carrier, but small enough to connect with our agents like a small business. We partner with only the best agencies and seek out their feedback to help us make important decisions. With each interaction, whether it’s service, claims or billing, we know we represent our agents to their clients.

a message from the president & ceo

“Last year we said goodbye to the status quo and ushered in a brave new world.”

We said goodbye to the status quo and ushered in a brave new world filled with both challenges and opportunities. Technological advances are changing the way we live, purchase products, services and do business. They are also giving rise to market disrupters at an unprecedented rate.

At Grange, we are meeting these challenges head on, with open eyes and a clear vision. We are taking control of our destiny by focusing on transforming the way we do business from a position of great strength. Much of what we accomplished in 2016 laid the foundation for us to move forward in new and exciting ways, while maintaining the strength and stability we’ve delivered for more than 80 years.

In 2016, our top line was challenged over the prior year based on deliberate actions taken to better balance our Commercial Lines book and to remain disciplined in our homeowners business in the absence of significant weather events, which we expect to return. We made purposeful decisions and trade-offs in these areas to ensure we can continue to be a stable partner for you well into the future.

Despite these challenges and with our agent partnerships, we generated $1.21 billion in premium and delivered our third lowest enterprise combined operating ratio of 93.7% in several decades. In addition, we achieved an all-time high year-end surplus of $1.16 billion. With focus, we achieved another profitable year for the business despite our industry’s changing and increasingly competitive environment.

The industry also recognized our financial strength and stability. A.M. Best affirmed Grange’s “A” (Excellent) rating and, for the first time in several years, revised our Issuer Credit Rating (ICR) from a negative to a stable outlook. Additionally, a U.S. Auto Insurance survey by J.D. Power showed that Grange’s overall satisfaction score from policyholders in our region improved significantly and we were one of only four profiled carriers to do so.

Across our business segments, we brought new, competitive products to market and made smart investments to position us for future success. We completed our commercial repositioning efforts and are beginning to see strong improvement, as Commercial Lines achieved its first combined operating ratio under 100% in several years. Personal Lines continued to deliver consistent profitability with its lowest combined ratio in a decade. We also made a significant investment in Grange Life to ensure its continued stability, with a focus on growing our core life products. In addition, we continue to maximize our relationship with our affiliate, Integrity Insurance, to better serve our agents and customers across our 13-state footprint. Integrity delivered its fifth straight year of profitable growth for the enterprise.

But numbers are only part of our story. Last year we made important investments and clearly defined our path forward in this new world. We’re creating an innovative culture through our innovation incubator to bring new ideas to life that improve how we work and how we serve our agents and customers. As a result, 2016 saw the launch of our own Grange Insurance Skill on Amazon’s Alexa Voice Service, enhancements to our MyGrange customer portal and the rapid development of a customer mobile app.

We also reestablished our commitment to creating an inclusive culture that values the unique perspectives of our associates and agent partners. We believe that focusing on diversity and inclusion will help us better understand the needs of our customers and agents, providing them with the right products and services and helping us keep pace with the marketplace.

And lastly, we distinctly stated our promise to agents to be Committed, Connected, Partners. We are dedicated to bringing value to our agents by delivering on our relationships and making it easy to do business with us. Working together as Committed, Connected, Partners is essential to our joint success. With the insurance business growing increasingly complex, having a trusted advisor is more critical for consumers, both business and personal, than ever before. That’s why we partner with each agent to deliver peace of mind and protection for every customer we serve.

I’m excited about what the future holds for Grange. In 2017, we will stay the course on our strategic plan and continue our promise to be a stable, predictable partner for our agents. We will be focused on making smart investments for the future that will enable us to grow profitably.

Thank you to our policyholders, agent partners and associates for being a part of our journey in this brave new world.

We said goodbye to the status quo and ushered in a brave new world filled with both challenges and opportunities. Technological advances are changing the way we live, purchase products, services and do business. They are also giving rise to market disrupters at an unprecedented rate.

At Grange, we are meeting these challenges head on, with open eyes and a clear vision. We are taking control of our destiny by focusing on transforming the way we do business from a position of great strength. Much of what we accomplished in 2016 laid the foundation for us to move forward in new and exciting ways, while maintaining the strength and stability we’ve delivered for more than 80 years.

In 2016, our top line was challenged over the prior year based on deliberate actions taken to better balance our Commercial Lines book and to remain disciplined in our homeowners business in the absence of significant weather events, which we expect to return. We made purposeful decisions and trade-offs in these areas to ensure we can continue to be a stable partner for you well into the future.

Despite these challenges and with our agent partnerships, we generated $1.21 billion in premium and delivered our third lowest enterprise combined operating ratio of 93.7% in several decades. In addition, we achieved an all-time high year-end surplus of $1.16 billion. With focus, we achieved another profitable year for the business despite our industry’s changing and increasingly competitive environment.

The industry also recognized our financial strength and stability. A.M. Best affirmed Grange’s “A” (Excellent) rating and, for the first time in several years, revised our Issuer Credit Rating (ICR) from a negative to a stable outlook. Additionally, a U.S. Auto Insurance survey by J.D. Power showed that Grange’s overall satisfaction score from policyholders in our region improved significantly and we were one of only four profiled carriers to do so.

Across our business segments, we brought new, competitive products to market and made smart investments to position us for future success. We completed our commercial repositioning efforts and are beginning to see strong improvement, as Commercial Lines achieved its first combined operating ratio under 100% in several years. Personal Lines continued to deliver consistent profitability with its lowest combined ratio in a decade. We also made a significant investment in Grange Life to ensure its continued stability, with a focus on growing our core life products. In addition, we continue to maximize our relationship with our affiliate, Integrity Insurance, to better serve our agents and customers across our 13-state footprint. Integrity delivered its fifth straight year of profitable growth for the enterprise.

But numbers are only part of our story. Last year we made important investments and clearly defined our path forward in this new world. We’re creating an innovative culture through our innovation incubator to bring new ideas to life that improve how we work and how we serve our agents and customers. As a result, 2016 saw the launch of our own Grange Insurance Skill on Amazon’s Alexa Voice Service, enhancements to our MyGrange customer portal and the rapid development of a customer mobile app.

We also reestablished our commitment to creating an inclusive culture that values the unique perspectives of our associates and agent partners. We believe that focusing on diversity and inclusion will help us better understand the needs of our customers and agents, providing them with the right products and services and helping us keep pace with the marketplace.

And lastly, we distinctly stated our promise to agents to be Committed, Connected, Partners. We are dedicated to bringing value to our agents by delivering on our relationships and making it easy to do business with us. Working together as Committed, Connected, Partners is essential to our joint success. With the insurance business growing increasingly complex, having a trusted advisor is more critical for consumers, both business and personal, than ever before. That’s why we partner with each agent to deliver peace of mind and protection for every customer we serve.

I’m excited about what the future holds for Grange. In 2017, we will stay the course on our strategic plan and continue our promise to be a stable, predictable partner for our agents. We will be focused on making smart investments for the future that will enable us to grow profitably.

Thank you to our policyholders, agent partners and associates for being a part of our journey in this brave new world.

John Ammendola

President & Chief Executive Officer

John Ammendola

President & Chief Executive Officer

2016 FINANCIAL REPORT

financial Overview

GRANGE ENTERPRISE P&C

FINANCIAL REPORT*

Assets

Cash and Short Term Investments

Bonds (at amortized cost)

Stocks (at market value)

Real Estate (at cost less accumulated depreciation)

Floating Rate Bank Loans

Other Invested Assets

Securities Lending Reinvested Collateral Assets

Accrued Investment Income

Premiums in Course of Collection

Federal Income Tax Receivable

Net Deferred Tax Asset

Other Miscellaneous Assets

Total Assets

 

Liabilities and Policyholders’ Surplus

Unearned Premiums

Reserve for Losses

Reserve for Loss Adjustment Expense

General Expenses Payable

Borrowed Money

Payable for Securities Lending

Other Liabilities

Total Liabilities

Policyholders’ Surplus

Total Liabilities and Policyholders’ Surplus

 

Statement of Income and Surplus 2016

Premiums Earned

Losses and Loss Adjustment Expense Incurred

Other Underwriting Expenses Incurred

Net Underwriting Gain

Net Investment Gain

Other Income Less Other Expense

Dividends to Policyholders

Income Before Federal Income Taxes

Federal Income Taxes Incurred

Net Income

Payoff of surplus notes

Other Surplus Changes

Change in Policyholders’ Surplus

Policyholders’ Surplus — January 1

Policyholders’ Surplus—December 31

 

$62,042,657

1,474,983,873

472,755,276

102,265,021

62,134,918

46,115,055

25,843,065

14,507,151

236,107,568

5,746,333

50,056,556

18,002,000

$2,570,559,473

 

 

$468,220,419

535,512,761

160,857,442

56,439,690

60,115,000

25,843,065

106,372,563

1,413,360,940

1,157,198,533

$2,570,559,473

 

 

$1,182,825,599

736,505,163

378,889,093

67,431,343

68,789,965

14,805,949

(3,608,404)

147,418,853

38,515,896

108,902,957

(35,000,000)

(30,410,198)

43,492,759

1,113,705,774

$1,157,198,533

GRANGE LIFE

FINANCIAL REPORT*

Assets

Cash and Short Term Investments

Bonds (at amortized cost)

Common Stocks (at equity)

Policy Loans

Securities Lending Reinvested Collateral Assets

Accrued Investment Income

Premiums Due and Uncollected

Amounts Due from Reinsurers

Net Deferred Tax Asset

Other Miscellaneous Assets

Total Assets

 

Liabilities, Capital and Surplus

Policy Reserves

Policy Claims Payable

General Expense Payable

Interest Maintenance Reserve

Securities Valuation Reserve

Payable for Securities Lending

Payable to parent, subsidiaries and affiliates

Funds held under coinsurance

Reinsurance payable

Other Liabilities

Total Liabilities

Total Capital and Surplus

Total Liabilities, Capital and Surplus

 

Statement of Income, Capital and Surplus 2016

Premium Income

Net Investment Income

Benefits Paid to Policyholders

Operating Expenses

Income (Loss) Before Federal Income Taxes

Federal Income Taxes Incurred

Net from Operations after Dividends to Policyholders & Federal Income Taxes

Net Realized Capital Loss

Net Loss

Paid in Capital

Other Surplus Changes

Net Change in Capital and Surplus

Capital and Surplus - January 1

Capital and Surplus - December 31

 

$14,190,667

357,199,558

12,087,891

11,802,628

1,161,380

3,142,096

40,949,301

6,397,533

5,123,558

215,337

$452,269,949

 

 

$343,973,936

5,111,516

4,576,278

1,294,572

2,809,978

1,161,380

10,372,674

4,036,240

3,881,793

1,305,501

378,523,868

73,746,081

$452,269,949

 

 

$68,279,973

13,054,601

86,283,714

19,112,805

(24,061,945)

4,012,850

(28,074,795)

(744,541)

(28,819,336)

60,000,000

110,342

31,291,006

42,455,075

$73,746,081

* Balance Sheet — December 31, 2016

Grange Mutual Casualty Group which includes Grange Mutual Casualty Company, Grange Indemnity Insurance Company, Grange Insurance Company of Michigan, Grange Property & Casualty Company, Trustgard Insurance Company, Grange Life Insurance Company, Integrity Mutual Insurance Company and Integrity Property & Casualty Insurance Company. Coverages and discounts described herein may not be available in all states and policies are subject to underwriting guidelines. All life policies are underwritten by Grange Life Insurance Company, Columbus, Ohio, and are subject to underwriting approval. Please contact a local independent Grange agent for complete details on coverages and discounts.

Grange Mutual Casualty Group which includes Grange Mutual Casualty Company, Grange Indemnity Insurance Company, Grange Insurance Company of Michigan, Grange Property & Casualty Company, Trustgard Insurance Company, Grange Life Insurance Company, Integrity Mutual Insurance Company and Integrity Property & Casualty Insurance Company. Coverages and discounts described herein may not be available in all states and policies are subject to underwriting guidelines. All life policies are underwritten by Grange Life Insurance Company, Columbus, Ohio, and are subject to underwriting approval. Please contact a local independent Grange agent for complete details on coverages and discounts.

PROVIDING PEACE OF MIND AND PROTECTION DURING LIFE'S UNEXPECTED EVENTS.

Bringing Security to Our Customers Since 1935

For more than 80 years, Grange has been a source of protection, trust and stability for its customers. Today, combined with our affiliate Integrity Insurance, we offer customers auto, home, life and business insurance in 13 states. And because we believe that our customers deserve only the best counsel and partnership in making these decisions, we sell our products exclusively through Independent Agents.

Integrity Insurance Corporate Headquarters, Appleton, WI

A LEGACY OF PARTNERSHIP

FOCUSED ON A COLLABORATIVE, STRONG ENTERPRISE

Celebrating 15 years together in 2016, our affiliation with Integrity Insurance is stronger than ever. Combined, we offer financial stability and a strong market presence that provides more value to Independent Agents and policyholders.

Today, more than 4,600 agents proudly partner with Grange and Integrity throughout our 13-state footprint. In 2016, Integrity grew premium at double the industry average and enjoyed its fifth straight year of profitability and growth. We will continue to bring our combined power to bear for the good of our policyholders, agents and associates.

COMMITTED. CONNECTED. PARTNERS.

We are Committed

With 50 years of an “A” Excellent Rating from A.M. Best and $2.6 billion in assets, Grange is a stable, reliable partner that makes decisions based on doing what’s right for our agents and customers.

We are Connected

And while we have the stability of a larger carrier, we’re still small enough to know our agents and their individual business needs. Whether it’s our easy-to-use online platforms, specialized claims representatives or dedicated underwriters, Grange is connected to its agents.

We are Partners

Grange Independent Agents get more than a carrier, they get a partnership. We respect the sacred relationship between agent and client, and that at each interaction, we represent our agents.

“INSURANCE IS JUST A PROMISE

...and if I can make good on that promise, then that’s everything. And that’s one of the great things about Grange. They can make good on that promise they have for the customer as well as the agent.”

 – Dan Reid, Reid Insurance Agency

TRUSTED ADVISORS.

INDEPENDENT AGENTS ARE A VALUED SOURCE OF EXPERTISE AND EDUCATION

Grange understands and supports the relationship between an agent and their client, and believes this bond is an integral part of our short- and long-term strategy. That's why we build unique relationships that focus on the Ease of Doing Business® for our agents while remaining a stable, consistent partner.

With a long history of partnering with Independent Agents, Grange is big enough to offer the stability of a larger insurance carrier, but small enough to connect with our agents like a small business. We partner with only the best agencies and seek out their feedback to help us make important decisions. With each interaction, whether it’s service, claims or billing, we know we represent our agents to their clients.

a message from

the president & ceo

“Last year we said goodbye to the status quo and ushered in a brave new world.”

We said goodbye to the status quo and ushered in a brave new world filled with both challenges and opportunities. Technological advances are changing the way we live, purchase products, services and do business. They are also giving rise to market disrupters at an unprecedented rate.

At Grange, we are meeting these challenges head on, with open eyes and a clear vision. We are taking control of our destiny by focusing on transforming the way we do business from a position of great strength. Much of what we accomplished in 2016 laid the foundation for us to move forward in new and exciting ways, while maintaining the strength and stability we’ve delivered for more than 80 years.

In 2016, our top line was challenged over the prior year based on deliberate actions taken to better balance our Commercial Lines book and to remain disciplined in our homeowners business in the absence of significant weather events, which we expect to return. We made purposeful decisions and trade-offs in these areas to ensure we can continue to be a stable partner for you well into the future.

Despite these challenges and with our agent partnerships, we generated $1.21 billion in premium and delivered our third lowest enterprise combined operating ratio of 93.7% in several decades. In addition, we achieved an all-time high year-end surplus of $1.16 billion. With focus, we achieved another profitable year for the business despite our industry’s changing and increasingly competitive environment.

The industry also recognized our financial strength and stability. A.M. Best affirmed Grange’s “A” (Excellent) rating and, for the first time in several years, revised our Issuer Credit Rating (ICR) from a negative to a stable outlook. Additionally, a U.S. Auto Insurance survey by J.D. Power showed that Grange’s overall satisfaction score from policyholders in our region improved significantly and we were one of only four profiled carriers to do so.

Across our business segments, we brought new, competitive products to market and made smart investments to position us for future success. We completed our commercial repositioning efforts and are beginning to see strong improvement, as Commercial Lines achieved its first combined operating ratio under 100% in several years. Personal Lines continued to deliver consistent profitability with its lowest combined ratio in a decade. We also made a significant investment in Grange Life to ensure its continued stability, with a focus on growing our core life products. In addition, we continue to maximize our relationship with our affiliate, Integrity Insurance, to better serve our agents and customers across our 13-state footprint. Integrity delivered its fifth straight year of profitable growth for the enterprise.

But numbers are only part of our story. Last year we made important investments and clearly defined our path forward in this new world. We’re creating an innovative culture through our innovation incubator to bring new ideas to life that improve how we work and how we serve our agents and customers. As a result, 2016 saw the launch of our own Grange Insurance Skill on Amazon’s Alexa Voice Service, enhancements to our MyGrange customer portal and the rapid development of a customer mobile app.

We also reestablished our commitment to creating an inclusive culture that values the unique perspectives of our associates and agent partners. We believe that focusing on diversity and inclusion will help us better understand the needs of our customers and agents, providing them with the right products and services and helping us keep pace with the marketplace.

And lastly, we distinctly stated our promise to agents to be Committed, Connected, Partners. We are dedicated to bringing value to our agents by delivering on our relationships and making it easy to do business with us. Working together as Committed, Connected, Partners is essential to our joint success. With the insurance business growing increasingly complex, having a trusted advisor is more critical for consumers, both business and personal, than ever before. That’s why we partner with each agent to deliver peace of mind and protection for every customer we serve.

I’m excited about what the future holds for Grange. In 2017, we will stay the course on our strategic plan and continue our promise to be a stable, predictable partner for our agents. We will be focused on making smart investments for the future that will enable us to grow profitably.

Thank you to our policyholders, agent partners and associates for being a part of our journey in this brave new world.

John Ammendola

President & Chief Executive Officer

2016 FINANCIAL REPORT

financial Overview

(800) 422-0550

Grange Insurance

671 S. High Street

Columbus, OH 43206

Grange Mutual Casualty Group which includes Grange Mutual Casualty Company, Grange Indemnity Insurance Company, Grange Insurance Company of Michigan, Grange Property & Casualty Company, Trustgard Insurance Company, Grange Life Insurance Company, Integrity Mutual Insurance Company and Integrity Property & Casualty Insurance Company. Coverages and discounts described herein may not be available in all states and policies are subject to underwriting guidelines. All life policies are underwritten by Grange Life Insurance Company, Columbus, Ohio, and are subject to underwriting approval. Please contact a local independent Grange agent for complete details on coverages and discounts.

PROVIDING PEACE OF MIND AND PROTECTION DURING LIFE'S UNEXPECTED EVENTS.

PROVIDING PEACE OF MIND AND PROTECTION DURING LIFE'S UNEXPECTED EVENTS.

COMMITTED. CONNECTED. PARTNERS.

COMMITTED. CONNECTED. PARTNERS.

“INSURANCE IS JUST A PROMISE

...and if I can make good on that promise, then that’s everything. And that’s one of the great things about Grange. They can make good on that promise they have for the customer as well as the agent.”

 – Dan Reid, Reid Insurance Agency

“INSURANCE IS JUST A PROMISE

...and if I can make good on that promise, then that’s everything. And that’s one of the great things about Grange. They can make good on that promise they have for the customer as well as the agent.”

 – Dan Reid, Reid Insurance Agency

TRUSTED ADVISORS.

TRUSTED ADVISORS.

a message from

the president & ceo

a message from

the president & ceo

“Last year we said goodbye to the status quo and ushered in a brave new world.”

“Last year we said goodbye to the status quo and ushered in a brave new world.”

2016 FINANCIAL REPORT

2016 FINANCIAL REPORT

financial Overview

financial Overview