Release Date: May 08, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: What were the key drivers behind the increase in net income for United Fire Group Inc in the first quarter of 2024?
A: Kevin Leidwinger, President and CEO, explained that the increase in net income to $13.5 million was primarily driven by improved underwriting results and higher investment income. He highlighted that the momentum from 2023 continued into the first quarter of 2024, with net written premium growing by 17.6% to $321 million, led by core commercial and assumed reinsurance business.
Q: How did the combined ratio and underlying loss ratio perform in the first quarter compared to the same period last year?
A: Julie Stephenson, Chief Operating Officer, noted that the first quarter combined ratio improved by four points to 98.9%, marking the lowest over the past eight quarters. The underlying loss ratio also improved to 59.4%, reflecting ongoing underwriting and pricing discipline across the portfolio.
Q: Can you discuss the performance and strategic adjustments in the commercial property and auto segments?
A: Julie Stephenson detailed that the commercial property premium change continued to exceed 20%, with rate achievement at 16.5% and exposures increasing by 5.5%. In the commercial auto segment, there was notable improvement with rates now achieving above 11%, driven by diligent focus on price adequacy and portfolio adjustments to enhance profitability.
Q: What changes were made to the investment portfolio during the quarter?
A: Eric Martin, CFO, reported that in the first quarter, the company completed a strategic reallocation of public equity assets into fixed maturities and transitioned the management of their investment portfolio to New England Asset Management. This move is expected to further increase future income and capitalize on higher interest rates.
Q: How did United Fire Group Inc address the dividend payments in this quarter?
A: Eric Martin mentioned that the company declared and paid a $0.16 per share cash dividend to shareholders of record as of March 8, 2024. This action continues the company's 56-year history of paying dividends, reflecting its commitment to shareholder returns.
Q: What is the outlook for United Fire Group Inc's alternative distribution and specialty lines?
A: Julie Stephenson expressed optimism about the alternative distribution portfolio, noting strong growth from new accounts and favorable market conditions. However, she mentioned that specialty excess and surplus lines net written premiums declined slightly as the company repositioned its portfolio for more sustainable profitability. The outlook remains positive with a focus on strategic growth and underwriting discipline.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
