FIHL - Earnings call transcript Q4 2024 | Fidelis Insurance Holdings Limited

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

Operator

Good morning, and welcome to the Fidelis Insurance Group's Fourth Quarter 2024 Earnings Conference Call.

As a reminder, this call is being recorded for replay purposes.

Following the conclusion of formal remarks, the management team will host a question-and-answer session and instructions will be given at that time. With that, I will now turn the call over to Miranda Hunter, Head of Investor Relations. Ms. Hunter, please go ahead.

Miranda Hunter

to Group's welcome Earnings Quarter and Call. Conference morning, Fidelis Fourth Insurance XXXX Good are our Officer. Dan our today me With Burrows, Jonny our CFO; CEO; Strickle, Chief Actuarial and Decleir, Allan

everyone time. These are via risks Before release X-K release I'd to our and over website uncertainties with recent call, risks the with information on management's filed SEC statements section, we filed question-and-answer are current earnings XX-F most and a quarter emerging the These made XXXX, include developing our statements. press at based like remind and annual as our subject fidelisinsurance.com. in described including Form forward-looking begin, may on report XX, uncertainties are during and the that to assessments press the of Form statements SEC number upon our fourth assumptions on and February and available

reflected basis these can statements materially believe forward-looking have or that we from will those be reasonable expectations no expectations give results achieved. Consequently, expressed a may Although actual we differ in assurance made, implied. when that

measure XX, pricing call For with GAAP future investors from our SEC and on review report is more the other performance. available safe the risks financial as X-K periodic the for that, to reports the those is index, included to quarter February earnings earnings the current on of filed statements regarding our the filed performance, RPI, well SEC release as harbor press us SEC Dan. yesterday, our renewal I'll U.S. forward-looking press to website to XXXX, which also to turn with fourth our via on which over and press fidelisinsurance.com. With our make on can that contains our at should X-K may fidelisinsurance.com release, both in furnished found that Form and release reference The definition information, in website, available of on time by will are factors including measures time. Management be affect and our non-GAAP each non-GAAP financial our reconciliation certain Form

Daniel Burrows

capital morning, you thank today. start programs. share focus investment partner our continued diversified Syndicate strategy. capital management, delivering remain as the marking with a Miranda. for year step disciplined whole, Thanks, on joining And we growth Fidelis dividend I our Partnership, and we our growth and Lloyd's making where line We management. growth. as investments wanted on our reflecting underwriting cornerstone to identified and our opportunities, onboarded Good repurchase in high-quality us underwriting, and our by we in In The expanding seized our and relationship in a and initiating significant top pivotal and our portfolio such of first approach to strategic diversification on XXXX everyone, outside

and Now closer year. average operating for generated numbers our net we income operating $XXX an taking a look These a equity the headline expectations to are of in return announcement this last prior now address development take announced results year inclusive detail. we to align through-the-cycle minutes I'd few not net do ratio X.X%. In at XX.X%, combined of like our a more and of on the clearly of of with adverse million week. some XXXX,

business XXXX and Aerospace prior relates line to development of underwritten During XXXX year in that we has impacted been the business. ongoing $XXX This in Aviation in the quarter, our net Russia-Ukraine fourth million by incurred conflict. and

are provide have successfully the settled have through date, system, increased court to has our various for continued have exposure we overall meaningfully To certain opportunities the claims. derisk to event. unprecedented progress help to in shareholders. this taken to by prudent These discussions settlement judiciously stages litigation of derisked our certainty X/X or exposure to this exposure from our As settling we total of steps approximately litigation resulting and

of A concluded in court of to the English remaining these on a judgment which sheet will initiatives. our are portion and our outcomes, a of importantly, the probabilistic reserved claims recently updated model regardless information most received. months. significant For and potential continued capital the coming rendered we management recent be of balance will support strength trial, these court growth Perhaps X/X, strategic relate the basis developments outcomes and incorporating

with prior full business. Turning to by XX% objectives our through credit and back and driven achieved return portfolio billion and on diversification to long-term excluding exceeded XXX% delivered and performance rates we Aerospace, across written retention continued would portfolios new target. growth Aviation year. year development our We to adverse our the XXXX, of Growth the We our as specific our for on marine primarily property, structured as grew $X.X direct underwriting reinsurance gross was for insurance strong RPIs well net book. our have premiums equity average

disciplined we've the preferential a market. capitalized as increased capitalize and market maintain we At certain lines will that property XX% favorable business, to Where XX% held and our leader does approximately specialty discipline underscore remains with secure deploy on business lead support terms XX% see not not our split hurdles. and competition approach leverage we our nimble capacity of as Consistent key time, meet grew of written most in portfolio premiums in conditions Our to as same These a and a see across years, our underwriting. underwriting verticalized direct more continue ability rates, classes strong results premiums conditions. XX% we gross we on Reinsurance targeted opportunities our to insurance our and to opportunities reinsurance. and positioning. prior

these a increase our cash and XXXX, We well $XXX underscore of the we management is our by of attractive our strategy, results million of to enabled we our Moving focused net our to the and return strategic XX% earned cornerstone to on optimizing income will investable assets focus remains increase excess higher see portfolio our and for opportunities. yield investments. balances. an income driven as The Active year, our delivered XXXX. on from fixed was us This and position in investment positioned strong opportunistically go enter portfolio And a risk-reward remain risk capital where Allan XXXX, In shortly. more investment most capital detail appetite. portfolio within capital into on shareholders. capital our we deploying an

the million During and of dividend $XXX buyback returned capital we year, programs. to our excess share

California Allan, to handing before it impact discuss over briefly want Finally, recent the to of the wildfires. I

unprecedented our I to winds high who's First peril. want losses for this and dry vegetation, to January greater average in impacted. foremost, and than The and everyone thoughts by been wildfires conditions fueled sympathies extend industry resulted

based of underscores the we history. estimate portfolio loss expect the these for insights with summary, and billion for natural in event insurers $XX $XX risk of week, million landscape. In last to the out disasters on an related call, the insurance of essential be announced opportunities reinsurers reflect coverage conditions in our to necessity evolving emphasizes anticipate losses industry insured this offer $XXX XXXX frequency to range role into As catastrophe to of losses we The position. XXXX. net and In recoveries, capital of more expected the to catastrophe XXXX, impact Later closed million, natural sixth increasing a premium year will and climate and and it resilient, diversified $XXX most premiums net the reinstatement strong of terms renewals and accurately of the costly in change. highlight escalating the I Events tax. January this and made like rates we billion,

provide performance. overview However, who Allan, of our will turn financial will I first, an it over to

Allan Decleir

everyone. morning, good and Dan, Thanks,

insurance saw you results and our internal our more operating ensures closely segments, in peer As earnings that our XXXX we release, change decision-making are aligns with year-end reinsurance. management reporting. and reporting our aligned financial and reporting This newly structure is defined under process with

previously new and of our insurance segments, which component proposition. remain specialty our reported critical Our both segment includes of value a bespoke

in results results. going XXXX Before highlight like to our into annual detail, I'd quarterly our

As we mentioned, our are with on executing the Dan strategic progress we made objectives. pleased

Our $XXX increased the for of the or a from per by income share. of closed was book We share, diluted which value common $XX.XX, with per end $X.XX AOCI, X.X% year diluted operating including XXXX. net million XXXX

and Our total having billion, is through million returned $X repurchases. to dividends share shareholders capital while $XXX

results. Now our taking quarterly a closer look at

gross in or $XXX XX% XX% versus excellent Insurance the same year. an of quarter the with In increased We last in top of increase written the the $XXX growth by quarter, deliver written million million continue to quarter. segment, line premiums premiums gross

million for to premiums remain premiums high as primarily which multiyear to although written, quarter, continue to our We decreased ceded key quarter discipline grew dynamics new and bond, seasonally Reinsurance find the of We increase portfolio. versus added significant premium see retention market our we opportunities classes in written catastrophe as market end XXXX, announced levels we an business. a Re million rates written around million our the by lowest most net new $XX our for support diversified result recent gross the QX continue to written $XXX of and publicly fourth favorable, is December. across in segment, $XX Meanwhile, at premiums of remained. In Herbie

compared prior Our quarter premiums to growth driven increased current earned year the written the net fourth periods. premiums by by XXXX, of and XX% gross of in our

of ratio in more the down components for to the I'll Turning detail. XXX% quarter. the combined break

period net quarter $XXX of in last development Our favorable same $XX adverse the million the development net was to compared year prior million in year.

quarter, favorable benign experience net of the and the in line prior development of segment Insurance on The for losses. adverse week quarter. business Aerospace Insurance catastrophe fourth million in positive XX.X of release, Reinsurance segment As Aviation segment year of the the development favorable or the of by experienced noted net points $X driven last million. had our remainder $XXX attritional our had The $XX and in million press ratio loss of development development

our in in benign majority have full trends of losses Continuing the quarter was and in loss Hurricanes XX.X% Of $XX the compares and prior large XX% development in or period. losses year for loss This The $XXX Aerospace. attritional segments, year Helene. The reflects accounted or in ratio XX.X% was to the quarter quarter nearly prior our across XX.X%, and catastrophe improvement adverse prior the with and included last XX.X% $XXX year large reinsurance XXXX. of $XX which improved the to compared over net million fourth lines to the period. The losses, the insurance compared attritional in in and years. entirety ratio fourth of to the million of business, loss prior Our offset in million Milton favorable related adverse prior year million. ratio improved year to particularly attritional terms and to we year of loss the by Aviation catastrophe optimization for XX.X% quarter the development with several our million, portfolio both of $XXX development year all fourth seen XXXX

Turning acquisition due driven Policy costs to were points in the the quarter prior ratio written Insurance our acquisition period. mix segment year lines combined in points of and business by third and to of business parties to expenses of was for the expenses. compared variable The from in changes higher commissions certain the XX.X XX.X primarily ceded. in increase

ratio year how policy that run acquisition full of more business. The in This third TFP Our are for XXXX. profit points in of points combined reinsurance. quarter reversal commissions book costs expenses year points current of our policy for variable The accrued is commissions reflective of for expenses the were the should XX.X our and regarding insurance a acquisition of for all for been net Fidelis of XX.X acquisition X.X expectations the Partnership through quarter. accounted had the

Fidelis underwriting hurdle. not This demonstrates reflects For in profits and as the profit TFP no operating meet as framework XXXX, our that with as The the payable Partnership there alignment defined did the to framework commission is agreement agreement is interest required of the intended.

was general $XX of $XX variable and XXXX. year. lower compensation in fourth administrative expense decrease driven million in the our the were expenses current million in accruals versus The by Finally, quarter

in investment higher our net income with prior million period. increased income increase and on to as assets $XX fixed the a earned cash an year Our well of reflecting year prior compared for as quarter million the compared to fourth investable $XX yield the period, XXXX portfolio in

million sold with book we of in securities $XXX X.X%, of $X loss of average quarter, yield million. resulting a the realized During an

overall securities income yield We with fixed continue portfolio. reposition average an our we approximately investment as to the X.X% purchase also reinvested new quarter $XXX million into of in

duration Average of The We portfolio. with also at value. represents of at investment AA- diversified assets X.X the and into December average diversified a strategy returns of consistent securities X.X%. hedge to very high fixed remains shareholder enhance within million third generate investable rating invested At part fund quarter X% total superior is XX, yield book is years. investment the of income fund with $XXX risk-adjusted risk appetite our hedge ongoing a and our our

government a in XXXX. XX% Turning The has starting tax tax. Bermuda corporate to enacted income

deferred $XX to be income As XXXX, is utilized as committed adjustment, while valued excess an offset tax strong to we of a against Consistent transition is years remain maintaining returning reminder, economic respect balance at corporate carrying asset Bermuda a substantially are capital million expected a we sheet the within which in payable. shareholders. to any that tax with Bermuda XX

Our share program is consecutive year. third account our January renewed At with tool Significantly, successfully important we capital strategy. for quota outwards we reinsurance outwards XX% protection. whole very our reinsurance in renewed a the of have the Travelers our Xst, majority agreement management

in bond, catastrophe named multiyear events mentioned securing million we of U.S. a for storm collateralized tranche $XXX for and protection in Re Herbie issued covered As earlier, the a earthquake period. reinsurance new our

quarterly with $X.XX the quarter. we continued common Finally, first dividend in have our

We have our repurchase $XXX authorized remaining million under plan.

position enable navigate conclusion, in and portfolio are continuing growth Our to market across to remain will now us evolving turn confident strategic committed repurchases. the Dan to while our conditions. I we pursue additional it share to strong to ability approach for opportunities capital accretive remarks. In to an will initiatives back opportunistic our our take

Daniel Burrows

Allan. you, Thank

areas ahead, to opportunity our see of portfolio. Looking we continue across

importantly, segments. differentiated disciplined, on take the able our focused in relationships our opportunity. appetite. scale, and enable maintaining business. agile navigate of within lead we areas successfully business that first rates, our conditions. Delving to opportunities to specialty deeper size our our our align leader verticalized are a to underwriting market to approach coupled leveraging terms at this the strategically are on achieve underwriting and gross and look opportunities market, book In underwriting risk to position, within continue capitalize we and positioning into build a and dynamics We line deep In the with of and approach our pursue Insurance, Property, us established as And on

January maintain to still continue XXX% levels Xst the and We for rate book. with of at bound RPI an discipline are strong retention business in seeing

we discipline this differentiate and and performance to Marine, through portfolio We catastrophe take verticalized the market multi-class leveraging a continue advantage exposures. In hull under across demonstrates how deploy approach, selective while liability in underwriting such the our line across more pressure. the taking war in pricing portfolio the we approach as marine manage ourselves our book more where is of match marine to to appetite, capacity areas and of attractive rating this maintaining our

diversification capacity continuing opportunities to Aviation, geographic are demand to growth fleet and cautious strong We see continue approach. pressure business capacity-driven a rate for take as through see new continues. In and we

period. tracking work credit, quarter and to leveraging the repeat offering Our to pipeline focus to and end underwriting market. discipline line first on continue for we differentiate maintaining prior our in ourselves year, a the is and strong package In structured size clients is new our with the and both following

Reinsurance. to Turning

prior we At saw consistent rates Our in in years. our and of to risk diversifying continue attachment opportunities take were optimize approximately ], points strategy and renew opportunities. [ of our we in capitalize the core terms clients line maintaining where able the price, with seek appetite. strong our with business X/X remains achieve to on prior achieved portfolio, advantage portfolio years across book, an conditions, significant our to we new RPI X/X the retention to improvements of to including XXX% We as

higher capacity We risk. to on view based continue clients to on focus tier our of deploy

channels committed markets, to Partnership, The leverage positions ahead our create look continue as we our XXXX, Through opportunities cross-selling our pursuing for identify as Fidelis across opportunities well and to and to growth new products. leverage lead relationship strong remain As accretive we distribution with portfolio. we

announced last partnerships highly business our Additionally, as diversify continue quarter, to portfolio that opportunities profitable efficient. form new are and and in we capital to segments explore accretive

value underwriters, to Our objective and opportunities ultimately new is evaluate delivering to to provide best-in-class capacity long-term on capitalize our shareholders. that

are $XX as noted of written estimated earlier, Effective book. with we X, provide where premiums on their capacity million small in will to XXXX. a Today, capped we XXXX, first taking Travelers, basis. a relationship component generate U.K. cyber is gross to announce with this approximately Our mortgage, our share added partnership, to another that in we reinsurance partnership is pleased quota January

the through hurdle Partnership, demonstrates quota new perspective, first agreement be through-the-cycle our partnership this reemphasize from that is market approximately to Fidelis portfolio binder After The targets. Together XXXX. rate that While premium working premiums effectiveness unwavering and and a XX% across and it testament not improvement material intended. anticipate reach collaborations. presence of high must lines business, successfully offer as most which we any across share may underscores growth target These our for our the book. ability our partners, with right processes growth years expanding written commitment It partnerships margin excellent see our with attractive enhancing reach to our of important we of and innovative exemplifies achieving for opportunities is are is to relationship growth and our new continue to our across the partners. gross a onboard our to This in in strategic of compound

the through-the-cycle for combined high cycle. XX% long-term ratio return targets to target average and continue operating on Our to mid- equity XXs aim of XX% to through

face strategic it we Our that support to management ensuring will of resilient underwriting fluctuations. With operator, disciplined market for and and objectives, initiatives competitive remain the to open now and these approach we that, designed capital questions. are in

Operator

that, Carletti question of line JMP. Matt the from With Instructions] comes first with Citizens [Operator our

Matthew Carletti

about just wildfires level. hoping Dan, of kind I a you high I -- but a event, QX question to it's about ask was know the

learned? might frankly, than looked expect event. kind as a at there mean, I tail were like, the for smaller the of event, we assess Fidelis number you any lessons Specifically, quite

So was that outcome, and MGU imply I'm learned bad lessons the not might but trying you there -- that might just sort to of a were you underwriting it differently? event in as guys tail any outcome that of to to should event? will Or the that think wildfire be what viewed have exposure when expect a you look is sort we for tail I approach

Daniel Burrows

Thanks dialing Matt. Thanks, A question. in. great Yes. for

wildfires So largest Xx estimated significant the is And larger around the loss. in obviously, we the think wildfire event a return period X for recent somewhere -- than previous the were XXX. wildfires the industry,

should reinsurers a course, what be of it's for budget at insurers our here look That's event of loss within loss. basis, within an well overall it's net the for. expectations and we paying our the on that year, for and So When cat we're this magnitude. well

last So the have when ratios we performed the it's Loss reinsurance portfolio, been well over X think about years. incredibly sub-XX.

in in think, 'XX, XX%. X%. And fact, was in it XXXX, I it was

So I robust seen side. think operate We we're much operating conditions. to market. in We've gross in net terms and improvements on line very a a

this that So impact a as of to within the I believe earlier underwriters was pricing expectations. trajectory pricing. of property say, high $X will an have like on and event direct one damage. worth, on in it's $X.X. I positive We to in deals talking on on of our from the some niche water seeing seen smoke week and rates increase net coverage, improvements in base he's And we're sublimits actually

of or at our events opportunities to business throughout or So is year. the strength to the look that we'll do of continue losses come circumstance, and that always out

intended. intended. operating line through from net we to working is The what we're learned is purchasing I as size as actually, think this gross reinsurance

Matthew Carletti

then circumstances deficit obviously circumstances, kind a carryforward results? 'XX know given the be question of no I That's a think or mechanism it carryforward 'XX? kind certain in could, should 'XX just the from quick to fees if a if reaches certain guess, any there I years how few be of can is, impact results. to level. for for was helpful. is certain framework 'XX about I under Okay. a in we it performance in the beyond short there mentioned Or follow-up. expect it encapsulated the release I Allan, And you in just agreement, Great.

Allan Decleir

Allan. Thanks the question. it's Matt, Yes, Great for question.

agreement is specific XXXX As is the combined -- remarks, the We year. said prepared and of agreement TFP as the carried XX.X% for deficit commission my forward. mentioned The binder profit it's ratio for zero, intended. for in working I had working a the the a framework

we deficit commission. and others So no essentially, XXXX, there future certainly go through we But years. will forward -- as wildfires to profit is the impact carry into the

quarter. accrue that on again, quarter-to-quarter that for So based results underwriting we'll

Daniel Burrows

I in, our aligned. does jump just it think I between are but -- what sorry much actually the very do alignment to the and is us that think demonstrate TFP results

as it showing they're So well.

I it intended. Allan that's working said, as -- exactly So shows think as it's

Operator

Meyer with KBW. And question the line from comes of your Shields next

Meyer Shields

I with the are beyond for Dan, guess put second, estimate or sticking you anticipating either you subrogation out? wildfires recoveries a any that within

Daniel Burrows

Yes.

go that I event, normally, expect it's in you to early too that. would sort detail think, really Mike, happening. into of on to any this But see

can So as we when we you, and will. update

Meyer Shields

Okay. perfect. No, that's

what this looks question, And little don't I through third. it quarter Second and if net you a talk drove like fourth investment income is significant than the or I know lower was not, could if the that. in wondering but was actually

Allan Decleir

hope Meyer, relatively the Allan. -- are we're in investable assets assets that with QX. quarter-to-quarter, QX is improve there's what obviously. amount But of variability the cash forward, flat the to net investment were QX. investable consistent versus of And The we're QX. QX, amount -- making in our seeing you're going flows were were it's that with returns and flat Operating obviously income we they

in are securities. higher-yielding reinvest returns proceeds We're with some the of again, managed So some pleased to the We positive. our portfolio.

So forward we portfolio. that optimized have expect going to

Meyer Shields

Okay.

crux So there's I guess cash that's no unusual the of right question. need the now. for really

Allan Decleir

there. Matt. sorry, Nothing unusual there's in -- Sorry, No, nothing Meyer.

cash course, through we go prime XXXX, as will flows be consideration. Of a

Operator

the Your Omega Office. next question Cooperman comes Leon of Family with from line

Leon Cooperman

you here. XX% an a over to I'm saying ridiculously cycle, you're to expect your XX% what help stock it because a insurance is little seems expert, me mispriced, not but do I to ROE. need a is

the [ to to now, earn than cycle, to equity, we're XX% hard So XX use the to XX% XX% we're so We're earnings. to you in to XX% saying in market assume expect selling X.Xx XX% more XX%. $XX.XX applied we a ] over I book around value.

So guesstimate? I'm Xx selling less assuming a at that we're Is reasonable than earnings. around

Daniel Burrows

I are you think Leon, Yes, exactly right.

the would has that exceed did not I business through-the-cycle And had think undervalued. great start in year, our whilst our we would year, target. very through-the-cycle have see last We is confident to absolutely exclude in through-the-cycle we XXXX. plan we a If industry exceeded the we plan. we're Russia-Ukraine the agree our

been So whilst hasn't the ideal warfare on we think can target. that, the entirely start, and still possible through-the-cycle exceed deliver the to it's we

Leon Cooperman

amount excess What capital guess, roughly? is the of we have currently, would you

Daniel Burrows

Yes. calls. We provide on detail don't that sort these of

Leon Cooperman

Okay.

So this answer question. let me

million stock to be You it have $XXX all price? in and would year was on the opportunity all your at arose the this left you repurchase, willing repurchase spend if this stock

Daniel Burrows

Yes.

a regardless outcomes profitably to execute able think We're remaining share that we're we repurchase. as things. includes strong and the grow underwriting the objectives, on well I do the obviously capital capital portfolio to strategic able both position, have a exposures, our -- of grow on and as

we'll do accretive, it's and appropriate. when as So that and very it's

Leon Cooperman

this. say Okay. Well, just let me

looking So as shareholders' money I at to buy an think a and looking outside environment, discount back your stock the with and thing can best book. your is the in big do you at your business

Daniel Burrows

undervalued. We the that Thank company agree you, certainly is Leon.

Operator

question Your of the from with Sachs. Robert comes next Goldman Cox line

Robert Cox

the of discussions. X/X remaining where much curious the of the ask stages did exposure and on not of to where Aerospace outcomes in the wanted various just I'm cases how view the you're on in I those settlement you're reserves. discussions change the your Aviation

did reserves how increase guess on the So much the asking just remaining I'm I X/X.

Daniel Burrows

now. really bit a important Rob. question Thanks, and Yes. that like a we quite on of time It's spend

a statements the So outline I'd like earlier. last done. release we week a actually just further call bit made we've to what on press made and Obviously,

derisked of we've stages you of reminding So to of for litigation. meaningfully the settlement vessel X/X the exposure we're our And overall aviation or ongoing we've total various in done, settled exposure. we've what actually

So left, probabilistic on which mentioned, core you that's of we're core possible range a outcomes. a model, the as X/X is on based outcomes, reserves holding

support we sheet There's both growth capital strategic exceeded continued would for outcomes, our of now? targets seen Now as our what actually seen without judgments will last the earlier, progressed information. balance in through-the-cycle objectives long-term and quarter. I have no of we the happened? XXXX. regardless And in why process, our litigation the piece these have Russia-Ukraine, We've our the year. management U.S. said strength in But What's legal has But single summary in

trial English coming know, trial mid-Feb is in As progressed. wrapped we up all judgment And also and months. the the then expected the Irish well

this So for resulted period. to the to has new we information both that activity opportunity and in table, settlement over an saw come certainly accelerate sides

Now, going settle -- those since potential around can't inherent derisks chosen in uncertainty It's a still set exposures which judiciously remind certain that is not a we exposures litigation. those litigation and We narrows cases. in have exposure. to come you, incomes think discrete live really on quantum incomes can't We we is cases, we need And to through back of comment you. sorry, give complex outcomes. we're that's really further that. I casualty won't once But what to say resolved, we would this discuss

a probably strategic X/X, continued of management say supports the balance that the objectives growth strength in have I'd So again, I'd to, just core we remaining capital outcomes XXXX. sheet in and point regardless

Robert Cox

on just follow-up growth, I appreciate guidance growth in it. GPW Got the a XXXX. And for as XX%

I think XXXX? of think increased we have little the about been net bit growth you should guys premium has as How growth net ceding ratio. lighter the a sort in

Allan Decleir

question. one. it's It's And Allan. for a very, Thanks very the good

that that on outwards assumed business have that is we reinsurance As we be know, a versus clear a written written. purchase. we we earn also on to is than what And lag there's sometimes to the the write all different basis

the of perfect mentioned, Re reinsurance the the and we've covers Herbie the we in is DNA And an X timing contract happened of business. our bond where quake that years outwards purchasing assumed QX, As quarter match of storm. example to part doesn't purchased that U.S. we named outwards always up important this when purchase multiyear a and for

earn out assumed So most to [Technical years that business. X X over that in the we will the in or part for X-year Difficulty] years. that policy certain is primarily Whereas next a wrote business X-year is the up QX

say that is of So XXXX, earned are premium written to earned, grow to the XX%, things another when answer we because to to will when that net lag and way whereas the look going is XX%. between approximately XX% and our grow

Robert Cox

could I If one sneak in. Okay. more

you -- segment. could could On think this for I segments you acquisition sort of insurance help guidelines was loss policy and hoping think walk given new us ratio, about expense had ratio? you the the in us us think the segment, insurance to the about I how other past, through guys

Allan Decleir

Thanks, Rob. Allan It's again.

are As prior for our while to over long-term high on quarters, important components targets mid- are are we we've the combined ratio focused ratio. XXs. And stated in the combined

you look prepared remarks, both to cat are, add we Then G&A, low have up mid- as alone, segment the as which at my and commissions Insurance I all in an in as basis on If the the low to well expectations XXs. ratio acquisition loss a in the TFP to XXs. said add costs attritional the to the and

Operator

of comes Markets. BMO question Mike next Zaremski Capital the with Your from line

Michael Zaremski

but been few you there what hop some about about if comment minutes any corporate larger side sort talked that. from credit But some later. I lastly, if how competitive obviously. I Maybe I but just spreads, on overall property the I'm curious the the segment, book. And stats, is, helpful, you in -- pricing on would don't businesses. can been too, RPI talk of credit levels, spreads Maybe of you it's of I'm especially pricing kind be into think -- a on know pricing. there's are there's lot then not deceleration, sure comments of just kind know excellent the about seeing a your on stepping can growing you did there's you're bespoke back of all I kind environment but of maybe we kind topic, same kind of gauge you share how know, since should see to kind your of in

Daniel Burrows

take it question. much the I'll part for pass very Thanks then on. first the and

XX% lines, reinsurance grow I we years. drivers have whole XX% year for year the yes, which that's direct portfolio of and conditions, specialty full for about able better were the compounded across XXX%. some XXXX, in benefiting the year. rates, other X that were really, look and think XXX%, to X in overall for the the The and property from So the RPIs look, QX, at to is We all market terms this last year-on-year the when

So verticalized our line. market. scale. as know, we grow in gives to you leader use That a reinsurance We use us leverage our a as gross

We offerings. package have

So of different we to conditions deals best the segments we major we'll that get within see that the tend terms sure make first. to business blend and lines

grown in was were book a D&F And year the has And we RPIs XXX% that grew for lot. of as think look to others for It year-over-year. year, last the So we full was the year, XXX%. for it the we property some I a I we and necessarily drivers, using the market and outcome the sort leverage specifically in about are are When full quarter conditions. 'XX, same XX% the better because get in leader, don't have think terms of and it RPI XXX%.

these difference all much year. the pre-wildfire. Obviously, not So for full are

As earlier, January. coverage event since said we in are improvements early the pricing seeing some wildfire impact and I

growth are So our realistic targets in this we market. believe

and across I think XXX XXX of portfolio we've specialty there'll lines. business, write recent lines the be of more seen over just around best some technical the margin between the or in we balance see that years. We

excited sub-XX, grow said incredibly performed a for for years. property has across think would about reinsurance, last we and earlier, the the reinsurance [ in will we're see. still optimistic, I the of are direct XXXX. We'll ratios sub-XX loss we're number well. but mid-teens X I ] opportunities to see lower low the So kind the

strong of So lines very we place, business. good that's think a margin the technical all It's pricing. across about how in

Jonathan Strickle

here. Jonny It's

or look bespoke the profitability in not giving facilitating mean, pricing, there, just as on terms hurdles. transaction just either something basis, it's comparing at of that's transfer really of we a I It's metrics So some well. the reminder as long-term our that the getting. a deal the clients capital relief against deal-by-deal risk really the a And are

we're pricing to So still that last or capital. hold Across so, helps products attractive quarter opportunities of those seeing lots over to deploy up. the

Michael Zaremski

gears kind reinsurance had year as Got maybe the And towers market if towers wildfires. bit. their events devastating buy hearing their California it. top of or to that helpful. insurers the to kind off from were impacted That's very a to the you feel related, reinsurance bit progresses? could move you any are looking a And reinsurance Curious who primary of additional seeing coverage the potentially utilized some California switching

Daniel Burrows

Great the the on Look, of remainder we positive question. for year. Yes. believe of this will impact event pricing have the trajectory a

on earlier, some seen times, of the side. improvement a already have said we direct couple I As

think to -- As will have deals positive will a market, impact. be come there we that

the as it's event unprecedented. It think industry, a for simple I that. is significant as

impact. has that have So to an

Our I well. really, said, really performed as book, reinsurance has

for those look So we'll and when we'll execute opportunities, as they and happen. on

be our business clients. our We to core to continue ties strengthen We relevant. with want

coming are So said, demand, there they execute. I market with for And as to them. new we're if we'll

Operator

comes Barclays. Your from the next Alex question line Scott with of

Taylor Scott

is the I conflict one in have the on with ongoing. First planes for you Russia

there you planes the of that be returned. what you still like through ongoing a like cases. of framed walk subrogation I maybe I way sort if from if be ceasefire, interested would think, pretty things happens for You the guess, the that, the around if risk would are us, frame could some I'd like? look court could us are well Like, it potential what is that

Daniel Burrows

first we'd peaceful parties. and see all an conflict, all outcome end this Yes. Again, I a think to with to satisfactory foremost, for a like end

of outcome would assets. get I will it early the to to be. the salvageable about are afraid sanctions absolute salvage, easier, it lifted, the discussions. settlement ongoing is if I part what think your about make you easier think too imagine think would I'm when it's

on think to into that. access can't if we the and we'd lifted. we I are it, give like it So go But will think to sanctions really see us good detail assets overall,

Taylor Scott

to to you there want to you conflict. did you on and But could don't the a say, was could if I what comment do resolution it appreciate that occur, full in separate that's of if few months, want losses Like you look fair next understand happens booked resolution that high guess, specifically. it asking say what I pretty if But a maybe them, this like to trying level and could let's the that at you that with to like that the look something on you, comment not like like lawsuit just the planes were available recovery what from... you I'm like point? is for get

Daniel Burrows

still is I we of exposure those think Yes, subrogation so we salvage said, I litigation, through as have And can't comment discussions. unfortunately, just part on it. live going

further. can't any comment just we So

Taylor Scott

Got it.

right. All Okay.

us market? execute this wildfire. Can that the split the maybe piece And you dislocation between to maybe the as on of there look in other to separate on, help of back maybe this So going through of a think it, California you the loss? side expected reinsurance insurance, there's as opportunities are

Daniel Burrows

Yes.

year. I said, reinsurance believe I come on increase and and couple and conditions years. the well the book and positive And is side, well loss budget we're of this last our impact a for. think been as an But points it have a in the reinsurance of is market about has direct book, is coverage, significant of our cat event direct side for it year there's what in it really, size. seeing terms our expect the pricing, the performed things through the the well this will you'd is certainly loss say remainder loss is The which And magnitude. split I of would reinsurance we'd say X/X and expectations for side. of some on the what in we reinsurance really is Yes, the attachment over and the within improvements of within here that rest

So maintained. that's been

opportunities. look to for on forward but this flow, expectation much very us. We we some So within see executing is

Operator

with Knudsen from the comes question next your And line of Evercore. Peter

Peter Knudsen

XX% cycle on term. XX% longer ROE continued guys through to the you hear I the

right, had near-term XX%. a think, provided XX% outlook 'XX, you guys in of sort to of I

And longer-term so on share that that relative potentially within I'm you shaking out just thoughts maybe your you some guys for where expectations see wondering, and to target? 'XX specifically could target yourselves

Daniel Burrows

the know, not in question. very Thanks much still Yes. quarter early XXXX, the even through first for we're yet. it's as Look, you

have actually And of add underwriting opportunity the price for find in, a ideal we the but start track which opportunities of we So profitable we I and the loss. in industry, very year. given record We not rest wildfires a for of think place the where have the is good positive, see plenty environment business. business, the we're ourselves can the the certainly manageable we

So much, we through-the-cycle confident in continues that are very our targets so year-on-year.

Peter Knudsen

are for be follow-up, back in the Russia-Ukraine my that? of considering Okay. situation. guys just wondering, insured you able share I'm aviation Great. reserves industry that's you what embedded to to sort guys the And for loss then would

Jonathan Strickle

Yes. It's here. Jonny

gone a question not think event. of difficult Obviously, type it's judgment. really through I that's for to this

leasing settled answer know base on. haven't We don't what party we question what an know the to it's reaching by to difficult had the partly outcome settlement have So at a moment. settled. to it really don't It's And value underlying with they've at. We companies. others extent

Daniel Burrows

sure will. not I'm we Yes. ever

we that's think I that can So best answer question. the

Operator

Jefferies. your the Andersen next Andrew with from line comes And of question

Andrew Andersen

becoming through of be high the well. higher we wildfires, like it coming that ratio XXs. 'XX the closer to combined bit just elevated little little that's think with If 'XX. ROE it a challenging feels a operating mid- feels but in It do in that Is target? a the mentioned of You cycle, to bit, to maybe on 'XX? 'XX hit. you It's target could the we is still will And RPI touch in getting like in see and more as yourself

Daniel Burrows

think high Look, If we confident combined ratio mid- the is would increases, rating really benefiting this environment, Russia-Ukraine market technical they're changed we have have our where about that. everything Yes. all ex hasn't from rates, we're hitting I would think those of targets. we That said, XXs. margin, been to kind good year, we've compound exceeded good

done we year. plan this year. last So have We'd on well were

year, in the loss mid- we're manageable still targets, but the high think a got It's include to early obviously wildfires. ratios which cycle XXs. we combined we've So still those that from through the confident

Andrew Andersen

first And study seasonality thinking the half is about? any the reserve there we of should be in year

Jonathan Strickle

It's Jonny here.

experience loss than from Just the in a terms It's rather comes really it in to about where background us being short-tail private any a business. from as give assumptions. of comes bit change of of through PYD underlying most our

by prior claims So development year prior every made if assumptions And a and we for benign claims development environment, example, fewer favorable favorable allowance driven year that our in last we than out through you take Russia-Ukraine i.e., really year, had for. quarter. overall coming was almost had

think different. I that's quite

you once a and QX. the really that at around, exercise. When if there look applicable year, to player, reviews those at coming said, changes year. that So we was through material where do not at look that's the being out assumptions reserves really someone casualty we in last reserving of like did knock-on nothing moves assumptions around the a look that to us. That your typically there it's them We as tend

Andrew Andersen

Okay.

I You have that's first of at mentioned a of weather QX, second activity that guess the I but if PYD. 'XX, of would related bit just look occurred half was half there in the quite to year.

half of look would at them So subsequent second again half if there's in of you kind it fair say be year? the to events, first weather the

Jonathan Strickle

Yes.

is year, more favorable it was attritional this PYD, Although it the side. on

for. So wasn't related year fewer was in to we'd accident the claims large made it's by for prior in driven reserves we movements It smaller the had prior. really than a events being allowance reported the that through just

Operator

next [Operator comes Instructions] Your the line Singzon from of question Pablo with JPMorgan.

Pablo Singzon

it litigated? as the various would can't considering or but be that to payouts still higher reserves, addition? the then scenarios being cover expected settled you much say claim you're reserve aviation both addition well being as drove and the probabilities And does under appreciate a X/X as X/X higher I settled about the the assume fair the follow-up, reserve already

Jonathan Strickle

fourth It's the Jonny in impact was of here. PYD majority the derisking. for through Thanks the The question. quarter

progressed reason that the and looking on into as discussions primary Obviously, model. information, There was as the through get Dan trials the process. period, was we and also the over moving an sell the on our So alluded it we but increase the derisking model new through other settlement the that to element X/X. feed of for the increasing to, X/X, the exposures was

Pablo Singzon

there? X point? book, are second risk some Any notable property development maybe the And X that you then Got you. I issues intellectual or this the at caused Okay. And quarters off question, think ago. fully

Allan Decleir

book. Pablo, it's our no Allan. material on intellectual There's development property

were that we look of material And But there we right it's and out on activity still as book -- change. performing of but monitoring the again, we were reminder, that's a constantly no handful expect. at a there. but now, treaties that, As there's business, there

Pablo Singzon

you They're fully but are because the being when are right? are you renewed, when the risk Allan? not And off does there, those when -- in runoff, off risk

Jonathan Strickle

that possibility up Jonny It's the XXXX, off transaction that. although to the around there's run risk They here. would earlier this always take off than

Daniel Burrows

outstanding. but limited -- is of deals a number very there Outstanding

So...

Jonathan Strickle

than handful. less Yes, a

Daniel Burrows

Less handful, than a yes.

Operator

Thank you. And that session. concludes today's question-and-answer

to Burrows closing remarks. So back Dan turn for I'd to it like

Daniel Burrows

Thanks very employees thank contributions. for I'd our a their our much. moment like to take partners to and immense

Our team is our greatest possible. would be success not competitive advantage. without our them, And

your there take now enjoy over joining operator additional We calls. the Fidelis us remainder to the to we the to ongoing I'll support. you here are questions, Thank appreciate are call. you thank Please of to up turn your any if And And it wrap today. day. everyone for the team. So your

Operator

conference participating. you call. that And today's Thank you. Thank for concludes

You may now disconnect.

Fidelis Insurance Holdings Limited (FIHL) 26 Feb 252024 Q4 Earnings call transcript