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Section 1: 8-K (8-K)

Document


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934


Date of Report (Date of earliest event reported): October 18, 2018


THE NATIONAL SECURITY GROUP, INC.
(Exact name of registrant as specified in its charter)


Delaware
 
0-18649
 
63-1020300
(State or other jurisdiction of incorporation)
 
(Commission File Number)
 
(IRS Employer Identification No.)
 
 
 
 
 
661 East Davis Street
 
 
 
 
Elba, Alabama
 
 
 
36323
(Address of principal executive offices)
 
(Zip Code)
 
 
 
Registrant's telephone number, including area code:
(334) 897-2273
 
 
 
 
 
 
N/A
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
 
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
 
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
 
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 
Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
          Emerging growth company 1
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 1






Item 7.01. Regulation FD Disclosure.
In accordance with Securities and Exchange Commission Release No. 33-8216, the following information is furnished to the Securities and Exchange Commission pursuant to Item 12, “Disclosure of Results of Operations and Financial Condition.” This information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
On October 18, 2018, The National Security Group, Inc. issued a press release disclosing managements range of estimated catastrophe losses from Hurricane Michael which impacted policyholders of our property and casualty subsidiary National Security Fire & Casualty Company in the state of South Carolina. A copy of this press release is attached as Exhibit 99.1 to this report and is incorporated herein by reference.
 
Item 9.01. Financial Statements and Exhibits

(d) Exhibits.
Exhibit No.
 
Description of Document
 
 
Press release, dated October 18, 2018, issued by The National Security Group, Inc.

    






SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
 
The National Security Group, Inc.
 
 
 
Dated: October 18, 2018
 
By: /s/ Brian R. McLeod
 
 
Brian R. McLeod
Chief Financial Officer
 
 
 



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Section 2: EX-99.1 (EXHIBIT 99.1)

Exhibit


Exhibit 99.1
395398815_nsglogo.jpg
661 East Davis Street
Post Office Box 703
Elba, Alabama 36323
PRESS RELEASE
FOR IMMEDIATE RELEASE

For Additional Information: Contact Brian McLeod - Chief Financial Officer @ (334) 897-2273.
The National Security Group, Inc. Releases Estimates of Catastrophe Losses from Hurricane Michael

ELBA, ALABAMA (October 18, 2018)…The National Security Group, Inc. (NASDAQ:NSEC) released estimates of reported catastrophe losses from Hurricane Michael incurred by property and casualty subsidiary National Security Fire & Casualty Company.

On October 10, 2018, Hurricane Michael made landfall along Florida's Panhandle near Mexico Beach. At landfall, Michael was a Category 4 hurricane with winds of approximately 155 mph. Based on data collected from the National Weather Service, Michael was the third most intense hurricane to make landfall in the continental United States with minimum pressure on the afternoon of landfall at 919 millibars. As Hurricane Michael moved inland into southeast Alabama and southwest Georgia, it remained a very strong Category 3 storm before finally weakening to a tropical storm as it moved through central Georgia and South Carolina. We had policyholders in Alabama, Georgia and South Carolina exposed to hurricane or tropical storm force winds from October 10th through October 11th.

Our pre-tax loss, net of reinsurance, due to Hurricane Michael is expected to be $4,000,000. Net of tax, Hurricane Michael will reduce our 2018 earnings by $3,160,000 and will reduce earnings per share by $1.25. The impact of Hurricane Michael will be reflected in our fourth quarter results. To date, we have over 1,500 claims reported from this event with approximately 85% located in Georgia.

Based on our analysis of historical reporting patterns, preliminary post event model output and assessment of early reports of claims to date, we estimate our ultimate gross losses from Hurricane Michael to be in the range of $10,000,000 to $15,000,000. However, any losses above our $4,000,000 retention are covered by catastrophe reinsurance to the extent of the upper limit of our catastrophe coverage of $72,500,000. Based on our estimate of gross losses, we expect losses from Hurricane Michael to remain well below the upper limits of our catastrophe reinsurance coverage. We also purchase reinstatement premium protection which reinstates catastrophe coverage for a second event that exceeds the $4,000,000 per event retention level. While net losses from Hurricane Michael will have a material impact on our 2018 earnings, we do not expect the storm to adversely impact our capital position.

 
The National Security Group, Inc. (NASDAQ Symbol: NSEC), through its property & casualty (P&C) and life insurance subsidiaries, offers property, casualty, life, accident and health insurance in ten states. The Company writes primarily personal lines property coverage including dwelling fire and windstorm, homeowners, and mobile homeowners lines of insurance. The Company also offers life, accident and health, supplemental hospital and cancer insurance products. The Company was founded in 1947 and is based in Elba, Alabama. Additional information about the Company, including additional details of recent financial results, can be found on our website: www.nationalsecuritygroup.com.
Information about forward-looking statements
Any statement contained in this report which is not a historical fact, or which might otherwise be considered an opinion or projection concerning the Company or its business, whether expressed or implied, is meant as and should be considered a forward-looking statement within the meaning of the "safe harbor" provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are based on assumptions and opinions concerning a variety of known and unknown risks, including but not limited to changes in market conditions, natural disasters and other catastrophic events, increased competition, changes in availability and cost of reinsurance, changes in governmental regulations, technological changes, political and legal contingencies and general economic conditions, as well as other risks and uncertainties more completely described in the Company’s filings with the Securities and Exchange Commission. If any of these assumptions or opinions proves incorrect, any forward-looking statements made on the basis of such assumptions or opinions may





also prove materially incorrect in one or more respects and could cause actual results to vary materially from our expected results. Please refer to the Company's Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission for information concerning the important factors that can cause results to differ materially from these forward-looking statements.


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