Kingstone Companies, Inc.
| Company Name | Kingstone Companies, Inc. |
| Stock Symbol | KINS |
| Class Period | March 14, 2018 to April 29, 2019 |
| Lead Plaintiff Motion Deadline | August 12, 2019 |
On April 29, 2019, the Company disclosed a $2.5 million charge to its claims case reserves and a $2.5 million charge to its IBNR reserves, based on a “comprehensive review of [the Company’s] claims operations.” As a result of the charges, the Company “expects to end the full year with a combined ratio excluding catastrophe losses of 88% to 91% and catastrophe losses of 4 to 5 points.”
On this news, the Company’s share price fell $2.07 per share, more than 15%, to close at $11.61 per share on April 30, 2019, thereby injuring investors.
The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that the Company did not adequately follow industry best practices related to claims handling; (2) that, as a result, the Company did not record sufficient claims reserves; (3) that the Company lacked adequate internal control over financial reporting; and (4) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
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