Kingsway Financial Services Inc. is reporting record results for the quarter and six months ended June 30.

The specialty auto insurer says net income for the second quarter increased by 59% to a quarterly record of $11.4 million compared to $7.2 million reported last year. Net income for the six month period was $20.6 million, an increase of 98% over the $10.4 million recorded a year ago.

Net income before goodwill was $12.9 million for the second quarter compared to $8.5 million last year, an increase of 51%. For the six month period, net income before goodwill was $23.5 million, an increase of 81% over $13 million last year.

Fully diluted and basic earnings per share for the second quarter increased by 57% to a new quarterly record of 33¢, compared to 21¢ last year. For the six month period, fully diluted and basic earnings per share doubled to 60¢ compared to 30¢ last year.

“I am very pleased to report record levels of earnings and premiums this quarter”, said Bill Star, president and CEO. “We have made an extremely good start to the year achieving record profits, earnings per share and premium levels. For the third consecutive quarter we have reported record written premiums which will translate into higher levels of earned premiums in future quarters.”

During the second quarter of 2001 gross premiums written increased 51% to a quarterly record of $260.1 million compared with $172.1 million last year. Gross premiums written were $44.1 million or 20% higher than the first quarter of 2001 which was the previous quarterly record. For the year-to-date, gross premiums written increased by 56% to $476.2 million compared to $306.1 million last year.

For the quarter, gross premiums written grew by 19% to $105.3 million for Canadian operations, and by 86% to $154.8 million for the U.S. operations compared to last year.

The combined ratio continued to improve on a quarter over quarter basis, and for the second quarter 2001 was 98.4% (99.0% year-to-date) compared to 100.6% (102.9% year-to-date) last year. The combined ratio for the Canadian operations improved to 97.7% (100.5% year-to-date) compared to the 100.1% (104.3% year-to-date) last year.

Investment income increased to $11.6 million ($25.1 million year-to-date) compared to $11.2 million ($20.9 million year-to-date) last year. During the quarter, realized gains amounted to $3.2 million ($5 million year-to-date) compared to $2.3 million ($4 million year-to-date) last year.