1. business and industrial
2. business operations
3. human resources

Exceptional People.
Exceptional Experience.
Annual Report 2014
Making
Insurance
Exceptional
Exceptional People.
Exceptional Experience.
T
he employees and agents of NYCM Insurance, and the way they care for
the policyholders we protect, have long exemplified superior commitment,
compassion and performance. As we look back at the past year — one that was not
easy for the property/casualty insurance industry in New York State — these qualities
reached a higher level still.
They were truly exceptional.
Spirit of Caring
The character of NYCM’s people is seen both in the
quality of service they provide to insureds and the manner in
which they serve their larger community. They demonstrate
the latter with remarkable support of causes that benefit the
community’s health and wellbeing in numerous ways — and
they did so in unprecedented fashion this past year. We’ve
highlighted some of those activities in this report.
In the arena of customer service, one of the most
exciting developments in 2014 was the implementation of
our Customer Experience Project, which transitioned into a
permanent department. This team of specialists is literally
making a science of customer service: analyzing what every
type of customer needs and expects from their insurance carrier, in every step of the
process, and leading the way in strengthening NYCM’s service even further to ensure
that every customer’s experience with us is not only a good one, it’s exceptional.
One of the ways that was demonstrated in 2014 was proactive calls made to
insureds in the storm-stricken Buffalo area in November, most of whom never had a
claim, just to make sure they were all right.
Our product development operations were also in high gear throughout the
year, formulating a number of new or enhanced offerings to be introduced in 2015.
One of them was NYCM’s Usage Based Insurance (UBI) program, which underwent
extensive testing among employees and agents. Using on-vehicle data recording
devices, the voluntary UBI feature will enable auto policyholders to earn premium
discounts based on good driving habits.
Another new product that progressed significantly in its development was
NYCM’s new Business Owners Policy (BOP), named “Compass.” We anticipate a
very positive reaction to that cutting-edge program and other forthcoming
product introductions.
NYCM Insurance Annual Report 2014
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Page 1
Answering the Call
In the insurance business, more than most, every year brings unpredictability. Beyond
providing the best insurance protection and service we can, we have little control over how
much our policyholders will need to call upon that protection. Nor do they.
Many insureds had to make that call in 2014, to recover from damages caused by
storms and other severe weather that struck across the state. From the hail storm and
tornadoes of the spring and summer, to the infamous
Buffalo snow storm in November, no season was spared in
a year that brought a total of nine major storm events.
Those events generated nearly $25 million in
incurred losses for NYCM Insurance. The combined
impact of the storms and intense competition in the
personal lines auto and homeowners marketplace pushed
our combined loss and expense ratio for the year to 104.7
percent. Their effects also overshadowed the positive
financial impact of loss adjustment expense reductions.
That fiercely competitive marketplace contributed
to a slight drop in direct written premiums, to $482
million from $484 million the previous year. Investment income was slightly less than the
previous year due to a smaller increase in the equity market compared with 2013.
Despite all of these challenges, however, NYCM Insurance had net income of $10.7
million in 2014.
Assets & Surplus Grow for Third Consecutive Year
NYCM Insurance concluded 2014 with record assets of $1.066 billion, an increase of $6.6
million over 2013. What’s more, our surplus or policyholders’ security fund grew by $13.6
million to $480.1 million. This marked the third consecutive year of growth in both of these
key areas.
A Certainty
As another year unfolds — and with it another period of unpredictability for the
property/casualty insurance industry, one thing is certain: our standard remains nothing
less than to make insurance exceptional for each of the hundreds of thousands of
policyholders we serve.
We are grateful to them for giving us that privilege — and to NYCM’s employees and
agents whose character and commitment continue to make that achievement possible.
V. Daniel Robinson II
President & Chief Executive Officer
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Saying it Best
When it comes to understanding an insurance company’s financial strength, A. M. Best
Company has long set the standard. When a carrier consistently earns that firm’s A
or higher rating, it sends a strong message that the insurer can be counted upon by
policyholders to deliver the protection it has promised.
For 2014, A. M. Best reaffirmed
NYCM Insurance’s A+ rating. It marked
the 78th consecutive year that NYCM
received an A or higher rating — a
distinction held by only 59 other
property/casualty insurers in the
United States.
Best’s Review, A. M. Best
Company’s monthly magazine, has
referred to this select group as “standing
the test of time.” It’s a test re-taken
every year.
Among the Reasons
Cited by A. M.
Best Company for
NYCM’s A+ Rating
for 2014:
“We’ve been seeing A’s and
A-pluses next to our name for so long,
it might be taken for granted,” notes
NYCM President & CEO Dan Robinson.
“However, it’s essential to remember
that the mark represents a grade our
company must earn annually based on
our business performance.
“Our results reflect the experience,
expertise and sound judgment that
the entire NYCM team applies to all
aspects of our operations — to keep
our company strong and among
• Solid risk-adjusted capitalization and
well-established market presence in
New York;
• Solid capital position and conservative
operating strategies;
• Solid net investment income, which has
been a major contributor to positive
pre-tax operating and net income;
• Long-standing agency relationships
and an advanced technology platform.
the most reliable in the industry for
policyholders.” NYCM Insurance Annual Report 2014
|
Page 3
Bringing Warmth to
America’s Greatest Heart & Walk
It’s not unusual for temperatures to be on the chilly side when America’s
Greatest Heart Run & Walk takes place each year. That makes the warmth exuded by
team NYCM in their vibrant orange sweatshirts fitting — as well
as symbolic of the several ways NYCM helps fuel the success of
this remarkable event.
Based on the campus of Utica College in Utica and
encompassing surrounding communities, the Run & Walk
raises life-changing funds for the American Heart Association
to prevent, treat and defeat heart disease, stroke and other
cardiovascular diseases.
NYCM Insurance is a major sponsor of the Run &
Walk. Its team of runners and walkers, perennially over
100 members strong, is one of the event’s largest —
and in 2015 led all of 90 participating teams in
dollars raised.
At the center of that achievement was NYCM’s Executive Vice President
& CFO Albert Pylinski, Jr., who not only led NYCM’s team in support
generated, but for the third year in a row was the event’s top fundraiser
overall. His leadership
and dedication to the
cause have led to him
being named chairman
of America’s Greatest
Heart Run & Walk
for 2016.
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Hitting Close to Home
Putting the Freeze on ALS
For decades, ALS — amyotrophic lateral sclerosis
— was known mostly as Lou Gehrig’s disease,
in memory of the New York Yankee great whose
career and life it cut short. Gehrig’s famous
“Today, I consider myself the luckiest man on
the face of the earth” farewell speech almost
romanticized his condition, masking the reality of
its devastating consequences.
Over the years, ALS remained largely a
low-profile, misunderstood disease — except
to its victims and their families. That changed
dramatically in 2014 as the “Ice Bucket
Challenge” raised unprecedented awareness
of ALS as well as funding that might soon help
bring the disease to its knees.
NYCM Meets the Challenge
In August, NYCM Insurance stepped up with
several renditions of the Ice Bucket Challenge.
Over 125 employees took their turn “under the
bucket” to raise funds for the ALS Association.
Kathy Bell, Senior Vice President of NYCM’s
Regulatory and Legal Affairs Division, has
seen the impact of ALS close up. She lost her
mom, Beverly Smith, to the disease. Beverly
was also a member of the NYCM family,
having worked in the Claims Division.
To Kathy, the Ice Bucket
Challenge literally brought a
flood of emotions: memories of
her mother, excitement about the
support generated for the cause,
appreciation that so many cared
and, of course, the “invigorating”
feeling of being doused with ice
and water for the cause.
Beverly Smith
“It was amazing,” Kathy said,
“to have so many co-workers
come up to me and say, ‘I really
didn’t know what ALS is and what
a terrible disease it is — and now I
understand.’”
Another moving experience
was having a fellow employee
share her experience. “I didn’t
Kathy Bell
know that Amy Wells of the
Underwriting Division had also
lost her mother to ALS. But when she saw
the pictures of my mom on my ice bucket,
she came up to me and said, “that makes
me miss my mom so much.’ Now we’ll stay
connected.”
Of NYCM’s effort, Kathy said, “It showed
the heart of this company. It starts with
management and then all of the employees
have huge hearts. They’re always reaching
into their pockets, finding ways to help their
fellow man.”
As a result of last year’s global support
of the Ice Bucket Challenge, the Association
was able to commit $21.7 million to support
programs and initiatives aimed at expediting
the search for treatments and a cure.
NYCM Insurance Annual Report 2014
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Page 5
Gus Macker Sponsorships
a Winning Play for Communities
Across New York
Bringing good things — like sportsmanship, wholesome entertainment and support
for charities — to great communities is something a company can never do too
much of. That’s why NYCM Insurance has long taken pride in
sponsoring Gus Macker Tournament Basketball.
During the summer of 2014 that support and enthusiasm
were stronger than ever at tournaments in Palmyra, Darien
Lake, Hornell, Norwich, Olean and Syracuse. At each, NYCM
sponsored the bracket tent and provided players with a
basketball-shaped string bag and scorecard.
The company added to the fun by giving away
sunglasses, sunscreen, lip balm and sanitizing wipes. Their
popularity might have been exceeded only by the free
photos — customized by location — that participants could
obtain at NYCM’s photo booth.
Each tournament attracted at least 250 teams, with some drawing close
to 400. Over the summer,
more than 2,000 people
followed the continuous
bracket updates that were
posted by location on
NYCM’s Facebook page.
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“Passport to Wellness”
has Employees on the Move
To Better Health
A passport is thought of as something that helps us move from one place to another,
usually a foreign destination. That concept applies in much the same way to NYCM’s
“365 Passport to Wellness” program that has employees on a journey toward
improved health.
They earn stamps for participating in a variety of wellness-related activities, with
the stamps qualifying them for incentive awards.
But the biggest reward is the health benefits they derive from integrating
the program’s core tenants of weight management, physical fitness and
good nutrition into their daily lifestyle.
Along the way, the Passport program makes it fun and
builds team spirit as well.
“The concept is being healthy all year,” explains Michele
Couperthwait, Vice President of People Development. “We want to
incorporate all aspects of wellness into everyday life, to promote a
healthy work and personal life 365 days a year for our employees.”
Among the most popular
From barbeques and dunkings, to
activities are impromptu events
Hawaiian days and Master Mind
like a passing-the-football
Challenges, Passport activities speak fun
competition that took place in the
and fitness in a variety ways.
Underwriting Division just before
the Super Bowl.
NYCM Insurance Annual Report 2014
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Page 7
Combined Financial Report as of December 31,
(000’s omitted)
2014 20132012
Bonds
Equities
Cash & Short Term Investments
Premiums Receivable
All Other Admitted Assets
TOTAL ADMITTED ASSETS
$773,564 98,127 13,010 117,273 64,031 $775,027 87,176 14,761 120,927 61,540 $736,369
54,805
34,611
122,784
77,120
$1,066,005 $1,059,431 $1,025,689
$307,967 237,305 40,670 $315,430 237,809 39,759 $329,780
235,829
36,228
$585,942 $592,998 $601,837
480,063 466,433 423,852
$1,066,005 $1,059,431 $1,025,689
$10,291 376 $36,089 (3,821)
$22,552
(4,046)
$10,667 $32,268 $18,506
Liabilities & Surplus
Reserve for Claims and Claims Expense
Reserve for Unearned Premiums
Reserve for All Other Liabilities
TOTAL LIABILITIES
Surplus
Policyholders’ Security Fund
TOTAL
Statement of Income
Net Income Before Federal Income Tax
Federal Income Tax Incurred
NET INCOME
Other Information
Loss Ratio
Expense Ratio
Combined Ratio
DIRECT WRITTEN PREMIUMS
73.6%
31.1%
68.0%
31.7%
70.8%
31.4%
104.7%
99.7%
102.2%
$481,824 $484,042 Licensed Territories: New YorkAM Best Rating: A+ (Superior)
1,066,005
480,063
466,433
1,059,431
423,852
1,025,689
Total
Admitted
Assets
Surplus
1,000,000
Page 8
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200,000
$487,104
Directors
VanNess D. Robinson
Edward Gozigian
H. William Smith, Jr.
V. Daniel Robinson II
Jennifer R. Haack
William F. Streck, M.D.
Chairman, Secretary
New York Central Mutual
President, Chief Executive Officer
New York Central Mutual
Albert Pylinski, Jr.
Executive Vice President,
Chief Financial Officer,
Chief Risk Officer, Treasurer
New York Central Mutual
Daryl R. Forsythe
Chairman
NBT Bancorp, Inc.
Attorney at Law
Gozigian, Washburn & Clinton
Private Investor
Benjamin C. Nesbitt
Retired - Senior Vice President,
Bank Investments
Wilber National Bank
Retired President
Smith Norwich, Inc.
Retired - President,
Chief Executive Officer
Bassett Healthcare
Howard C. Talbot, Jr.
Robert W. Ranger
Retired Director/Treasurer
National Baseball Hall of Fame
Charles R. Schanz
Retired - Owner/Operator
Horned Dorset LTD
Peter L. Owens
Michael R. Sweet
Chairman USNY Bank
President RWR Funding
Bruce C. Wratten
Owner/President
C.R. Schanz, Inc.
Officers
VanNess D. Robinson
Chairman/Secretary
V. Daniel Robinson II
Senior Vice President
Privacy Officer
Albert Pylinski, Jr.
Senior Vice President
Michael A. Perrino
Senior Vice President
Cheryl L. Robinson
Senior Vice President
Jeffrey R. Barrett
Senior Vice President
Assistant Vice President,
Information Security Officer
Michele D. Couperthwait
Judith J. Schnitman
Stephen M. Cembrinski
Vice President
William W. Couperthwait II
Robert D. Snyder
John E. Holdorf
Vice President
Douglas H. Franklin
Vice President
Kate M. Stacy
Michael J. LaCava
Mark A. Grygiel
Diane R. Wildey
Katharine S. Landers
Vice President
President/CEO
Exec. Vice Pres./CFO/CRO/Treasurer
First Senior Vice President
First Senior Vice President
Senior Vice President
Senior Vice President
Senior Vice President
Senior Vice President
Senior Vice President
Julie D. Palmer
Kevin L. Plows
Jeremy J. Robinson
Timothy A. Trueworthy
Vice President
Barbara A. Turnbull
Vice President
Mark R. VanDewerker
Vice President
Chad R. Barth
Assistant Vice President
Michael J. Millea
Assistant Vice President
Assistant Vice President
Assistant Vice President
Assistant Vice President
James E. Potts, Jr.
Vice President
NYCM Insurance Annual Report 2014
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Page 9
New York Central Mutual
Fire Insurance Company
1899 Central Plaza East
Edmeston, NY 13335-1899
1-800-234-6926 • Fax: 607-965-2712
nycm.com
A. Central
Insurance Company
1899 Central Plaza East, Suite 2000
Edmeston, NY 13335-1898
1-800-234-6926 • Fax: 607-965-2250
acentralinsurance.com