GBLI - Earnings call transcript Q4 2021 | Global Indemnity Group, LLC

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, and welcome to Global Indemnity Group LLC's 2021 Earnings Conference Call. I would now like to introduce Stephen W. Ries, Head of Investor Relations.

Stephen W. Ries

Thank you operator. Today's conference call is being recorded. forward-looking contain may remarks statements. GBLI's

such statements, environment the expressly is be forward-looking Some representation use and business the on future estimates. fact, our as Form the new other made GBLI. not Executive Please that may XX-K by be the results. not now will, estimates that whether future of over the in SEC is It by factors can affect obligation forward-looking of any Chief forward-looking expectations disclaims We of regarded our events otherwise. which any words, we and with materially pleasure Mr. a you description plans, result or and the LLC of information, contemplated expectations to my including, identified turn beliefs, of should to statements under without as important us refer such call statements operate Global for a forward-looking alter caution be obligation us to by or Charlton, or in or achieved. Group report a David annual Indemnity update limitation, that to filings its

David Charlton

less the will since remarks, It closing me Q&A. our open additional this a Thank of up we of and Officer; Investor the morning. remarks, we you am buying you, will and war consistently differentiator and earnings Indemnity. Head for year we Indemnity, Ries, Tom pleased been McGeehan, for are retaining greatest recruiting, Officer; and Chief for XX vision is I talented Steve is firmly Global Global been Operations; Thank have and highly Steve. our our developing that believe XX competitive provide and our market by progress then it product Relations This XXXX, call. Tom hired talent talent. the started Jonathan for to Well, new to will has people. one key in and Mauer, After my success date. managers. I our Insurance a complete I with joining excited Reiner President made underwriters people good the Operating Oltman, little new Chief and with in I updates. winning We've joining for I conclude my Financial call. In than leaders for of team

volatility Our excess lines and are to and up and growing. surplus that be other capital manufactured our dwelling Selling businesses homes deployed can lowered freed lines.

total business Our casualty percentage increasing. written a business of is as

Environmental, running. are Casualty businesses, three up Professional new and all and Excess Our

saw growth. XX% strong reinsurance by units Three programs with rate $XXX $XXX million, a $XXX of We written along a had XX% growth are grew all to to $XXX actively from quoting lines XX.X%. and first ongoing to to million. writing premium like grew premium businesses. core Penn-America XX% and increases. our growth to Gross million. grew lines casualty by grew binding businesses business. core was I substantial written growth, all these would These organic combination from XX% Gross in to speak million

to We progress combined business supplemented The momentum in in these to production is expect by ratio This lines XXXX our lines. ongoing new see from XX.X% XXXX. continued business in three will from compared XXXX. be XX.X%

by programs two in to was XXXX. driven million Prior Hurricane development, and $X.X Michael that Excluding we since have year from development compared $X.X lines underwriting prior to increased year continuing terminated. income million

made investments is we will be I products have better. will expect going performance future The While XX.X% that drive and people, in processes results forward. profitable,

from approximately compound provide million business premium adequate $XX.X rate combined million ratio time when of gross XXXX combined compared down ratio, XXXX. was income, The corporate XXXX annual gross written an to due and, business well. ongoing written reduce to was to $XXX from was $X The Gross including of XX.X%. over that perform providing adequate had continues & million, or is return. growth was fee XX% Reinsurance premium grew efforts XXX.X% is that cat-exposed premium XXX.X%. million to combined obtain Farm, continuing is a all to We Stable to $XX.X years in rates necessary, to ongoing not on a quota to several written to continues The casualty market. increasing businesses This fails the rate exited core a that ratio business to increase lines $XXX.X from same in are treaty terminate assumed million to in the million From businesses, casualty period. XXXX share returns. our that in in hard a for core participation the due XXXX we'll The strong to has of compared XXXX, XXXX. $XXX Global Ranch, not

XX.X% we casualty several inflation and reinsurance in in was the In excess smaller treaties XXXX, saw million. significantly addition the going and business. quarter Tom on up are compared We our specifically on in addition, the results XX.X% details property provide rate taking Investment Indemnity impact of we in Global addressing taking our ratio all XXXX. this across by investments. additional to our we of now to income to wrote gains XXXX. with on income increases XXXX maintain McGeehan fourth Reinsurance's compared combined and of claims, this finished in net are to are the our professional XXXX some of year and lines. investment part portfolio, is double-digit $XX.X

Tom McGeehan

and this we closed runoff. sold business sale renewing received morning. or $XX treaties, to are to combined mainly into homes in that by strategy non-cat compared XXXX, reiterate, in portfolio specialty performing business million increased. XXXX, Insurance of realized and business capital elsewhere brokerage family, Good lines. the exposed of income Services alternative placed future of – Common two investment and lowered exit business $XX.X lowered ratio dwelling lines with more. a manufactured was payments the million The property business the common $XX.X of and the catastrophe location sublease million. in in we loss impacted plus the volatility. XX.X% be $XX XXX.X% cash and million To reinsurance casualty lines compared property that stocks home catastrophe were to consolidated main includes KX exiting stocks investment million in in property in whereas, returns to these of in gains that $X.X exposure, up investments in our the were freed American from Realized In referred business and book can million income business was Investment value The our the of and not $XX XXXX. were $XX.X XXXX. company poor deployed million was XXXX. property was and reasons earnings Growth made or quarter, Order up including David values market $XX volatility business, of increased compared to negatively growing fourth million on

X.XX% sale Lowering Board Duration was for and income book fixed million declined yield XX, $XX.X by of expenses XXXX, basis Corporate rates compared years. yield, $XX.X cash to were Overall, XXXX, of Book and comprised XX, approximately X years. recurring points. During is book likely income is professional installments. quarter Duration the only of impact actions of and of duration at little lower was charged and Other remainder on dwelling write-downs XXXX. asset X.XX X.XX% in duration. in to XX, rights to December to was million, yields XXXX pay the million fee related May investments, the renewal at portfolio million expenses. on The X.XX contained the including mainly cash December to had recognized rise remainder home that renewal investment interest of returned the and Operating taken second the X.X% was the of at at manufactured flow income would XXXX, $X May is fees $XX million. XXXX. related XXXX policies $XX sale rights. comprised was XX,

later a interest XXth. debt will debt issue subordinated $XXX on of the is we Lastly, X.XXX%. noting we today, that million press retire April release on rate The will

sold private internal the in remainder occurred. it using the equity of is million common from and the $XX insurance million $XX million January be funds. debt. funding GBLI from before David. distributions Annual will the be is from to And market back investment, $XX a I of was the approximately be received will We of Approximately turn portfolio, the week LLC, the stock are which companies now, the of from the in funding funded will decline funding interest the of Holdings $XX.X the dividends owes most lower. redemption from sale the by million first cost that company

David Charlton

Thank you, Tom.

processes. our that been impacted are to growing We we core business So discontinued investing we in and new hired and have products, have technology improve introduced we're employees sold negatively results. products, segments talented

strong, a committed and remarks. talented drive our team will our future We That that concludes have success.

call the open questions. now will to We your

Operator

you. Thank

will question-and-answer you. We be session. now conducting [Operator Instructions] a Thank

Our your first & is from proceed Ferguson question with Dowling question. Partners. Please with Julia

Julia Ferguson

morning. was operations, year release. year? consolidated since it same the was a but understand the it question, for the there what your are about my basis? question, in continuing numbers on And you catastrophes. million Good What limited Thank question GAAP prior for taking a questions. a total basis full for I first $X And press information was development your on for

Tom McGeehan

two little of development areas, would a we was have adverse to than Michael, would future our little we $X.X Michael, with and on was if make one very – of of bit were related structure, for were a our a limited Michael that treaty one, all the incur incur to losses. And XOL would just programs. Hurricane worst Yes. in loss have reinsurance they million on more then we the our million. be that I prior We more and Answer kick number terminated, on second and basis, reserves programs to XXX% two cover or full was downside note in casualty Hurricane strengthened $X want year a development bit we year

as programs we on and Hurricane took appropriate reserved we are that terminated. two we action could about on Michael, So, we be, as just the

Julia Ferguson

catastrophes? Yes. And on

Tom McGeehan

year. $XX sorry, last million I'm

Julia Ferguson

the year. For full

Okay. correct? consolidated basis, On a

Tom McGeehan

including we On a exited. business basis, have consolidated that

Julia Ferguson

Thank you.

a particularly level review like trends mostly And been did largest factor that our other your in or high now, we inflation overall disclosures the regarding the IBNR? position inflation, released change in liability have new of any sure thorough to companies. and I'm given team was would is it been there to in Schedule Have your how reserving signs So did And procedures and what's reserving? reserving you your P the occurrence, in I information in And higher reserving comfort for very lines? case statutory by has reserves. of ask a opportunity look at an

Tom McGeehan

you Yes, Okay. have there. questions several

we're So one, with, our reserve very position. start with I'll comfortable

indications. actuarial Our booked the reserves remain above

very a have we think strong balance we sheet. again, So,

handled have for In inflation terms at, department as been a it's where those we're higher our this inflation years, in considering as updates the we service accurate than and what as factor. is the ultimate triangles actuaries quarters, that are picks. are reserving. does claims a doing inflation has manners. of their of actuaries get inflation, last considered it One, in known we're of that And several couple projections absolutely our loss the The are looking values, cash and they much to make several last admittedly, making losses, themselves is is the able but

David Charlton

the add would quarter. seeing the inflation XX% inflation, fourth we're looking the Tom, we're on property, and when discussed increases of I the in And, plus we really at to that,

Additionally, casualty as side, on as on well. really same up exposure seeing the we're rate go

to rate, pure getting exposure. rate on we're also addition in So

Julia Ferguson

you're And or mitigates your the inflation, give that of does And or casualty to us also Okay, social exposure middle can comfort small this focus illustrate somewhat given you inflation out your maybe average growth provide kind means anything would with lines of which casualty, in sense. overall, exposure which us recent respect? to makes social what book in market trends? putting

David Charlton

$X traditional correct are in million. I Sure. million, of the being put In Yes, that. out our think, lines our $X you're casualty business, part

side. have of we high don't limits the So really on a out casualty lot

and a be of would well. we're $X traditionally maximum casualty that as of excess Our reinsuring million, XX%

a don't to exposure we of have lot casualty really book. inflation So social on real our

Julia Ferguson

can – I'm All And versus overall, rate of your increases of book, if look right. at cost increases versus different dynamics segments loss you the in sorry, the trends of loss increases kind some you where margin is indication like cost for between trends? further and increases, provided rate your gap parts running this of potential different with of loss of book and

Tom McGeehan

side, the on than Well, property rate side. will casualty increases our be on Yes. higher the

But As make our low David of it's are insured increases we it. properly book sure values that noted be behind we're and during conversation, taking in how impacting and actually in raising will double his casualties rate and part to handling our that that. today's digits, inflation cognizant property we're putting of

Julia Ferguson

kind So think how expect going kind – underlying look all and and you underlying of ratios of about actions next your overall business, would at loss taking, margins the what in your of are if underwriting for the you forward, couple in rates we years? should you improvement

Tom McGeehan

we've as a David have – Reiner that above that executive management, on there's and minimum us they calls, are that. again, absolutely premium meet. our towards written return equity to And Well, contracts we're on of but X.XX%, hurdles aiming need target articulated past also net driving David

in get absolutely combined be happen of lower new in not that's to business. Global order of building today. We're strategic the we achieve have the We're hurdles, to So Indemnity. But the it's to part those that and over ratios time, our going would in businesses. XXs investing would vision

Julia Ferguson

it's Yes, right? seems segment, separate It Investor loss the forward? for Day lines – expect it's you should this year we long And tail How like your short drag with last? a mostly commentary. last $XX for lines, in going as million. what this will exited Okay. And line losses now was

Tom McGeehan

of chunk dwelling to related last it rather from to going is manufactured and us books. is is home there biggest most in The be behind Well, quickly. year the that

a just couple that. comments on So, of

if American either rights So the reinsured. is KX and Family have And some of acquired renewed, American use period on business. of to again, write they going for need XXth short last as paper. on not, Family, reliable Or a year, it that it's it's being October to still the is business time, American to XXX%

what this of we'll runoff. time where we placed book be into we Florida, off states time Louisiana, the get retaining again, is to business. of And this Now states we out say of writing two next XXX%. are both still the the year, One but around we we're did the that two about is fully those is by have – just largely

manufactured is again, and on of the – no home So and the books. our that's majority largest longer risk dwelling

end we second ceded is Family The occurred premium thing at reserves Group. November the American unearned of to also that the

corresponding that November. KX UPR those business in million on We ceded. same the UPR end again, of So approximately those reserves the ceded states acquired $XX October XX, of were at

will So low net in on be premium business the again, very that XXXX.

we it. brokerage, property on downsizing Lastly, have been

business more. strategic a made have We write values location of decision or $XX to million not with

forward policies that are any that mode. are I a said, much left a in runoff smaller So as book on also. And going that will be basis on

all So again, the to and there we actions the of property taking XX% we're we've casualty, the appropriate taken. strategy – XX% and to get actions are it's part to the move that

a be our call, we in businesses we noted we investment. investing investing in – are that reduced volatility we'll will our the that yield As and return expect on higher

David Charlton

part one just about the add would properties. for I casualty

property was XX%. comprised earned on basis, premium So that exited and net XX% when was you the business exclude a casualty

that making set XXXX. So continue we towards And new towards the – in of progress goal much in, especially the out very that going already a businesses that we lot kick as XX%. see we we're

Julia Ferguson

sense. makes That

So even correct it like this be – impact have significant the looks we year, than that starting from Is won't what lower this assumption? for a exited there XXXX. line, right, significantly even

Tom McGeehan

but promises, we've said. the mean just should If can't into you taken what translate you we actions – – I make it be. never should that

Julia Ferguson

equities, there's have I investment mentioned but the or is Yes. asset portfolio, to something geopolitical And but about thinking of size. underwriting Ukraine, the probably have, you some In the like assume last Russia, of your maybe I any about? there something countries you're on situation, there questions maybe impact given indirect no chunk exposure you your worry your your – in is assets, to invested that solid maybe

David Charlton

international did side. We in Yes. the the not have insurance from any exposure

we're very exposure And any also that So I'm not there. in of shape good aware have. we investment

Tom McGeehan

Yes.

Julia Ferguson

Okay.

Tom McGeehan

time. Not this high at

Julia Ferguson

your filing XX-K? expect are And when great. All right. when That's should we you XX-K your

Tom McGeehan

the Right for now, are XXth. aiming we

Julia Ferguson

XXth.

to the you any which right. lines, maybe Thomas There's little questions. if color your in don't new launched All more I on have provide you Okay. quarter. further first a want

I given additional cautious assume reinsurance you terms lines and loss being to of on picks those use. protection you're maybe purchasing Just lines are in that that new maybe

any you would information if provide interesting. can So further be

Tom McGeehan

Absolutely.

of our we So those all three lines, reinsurance. oversubscribed actually

of place those panel so in are areas. all And a pretty with product consistent much the three across

three And so we of XX% be at as those XX%. conservative. I lines are mentioned earlier, taking ensuring We're that to

place. their All have to be I quarter. you reinsurance would And going premium the see is the first in groups running in say underwriters. and teams built so And are of up most out They're the technology. the will of their

report the first we'll business them standpoint execute, was the first so quarter. running, quarter. and see the in more great writing effective from a And up and to it results get But all

Julia Ferguson

All you. right. Thank

David Charlton

Okay.

Julia Ferguson

Sorry.

David Charlton

to also, that say really that we we're see XXXX we're building we to time. as some see should going I it's take with And as your that, businesses. other new question Tom mentioned,

conservative looking being But XXXX and XXXX and impact are do really we we're XXXX. to you the look those so, really on loss see they to contribution. difference from is start significant make businesses in a the our how And making then a when picks out you where business, at

Julia Ferguson

you very Thank much. Great.

David Charlton

you. Thank Okay.

Operator

over There to to Thank time. at further turn the questions this I'd Ries are comments. Stephen any closing no floor you. like for back

Stephen W. Ries

We earnings Thank XXXX you. Thank This with look call. to concludes forward quarter about first you you results. for speaking our participating. XXXX our

Operator

conference. today's concludes This

time. Thank for You you participation. your may disconnect at lines your this

Global Indemnity (GBLI) 10 Mar 222021 Q4 Earnings call transcript