Markel (MKL) 2 Nov 222022 Q3 Earnings call transcript

Good morning, and welcome to the Markel Corporation Third Quarter 2022 Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] During the call today, we may make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. They are based on current assumptions and opinions concerning a variety of known and unknown risks. materially statements. contained differ by or may forward-looking such results from in those suggested Actual

in about non-GAAP that forward-looking Harbor and information on XX-Q, from may in Additional including factors We most and Form those financial differ results our discuss the captions, report also projected Cautionary materially XX-K to under and call statement. in on annual the today. Safe the recent statements measures quarterly included could is certain report cause Form actual Factors Risk

the may and XX-Q. You most measures comparable a reconciliation most Form find directly in GAAP to recent these measures GAAP for our

I Our Form turn the now over website Investors our the, like to XX-K on conference for Executive Co-Chief Tom ahead. Form recorded. and section. go Please be event Officer. would found www.markel.com this Please in can to at note Gayner, XX-Q being is

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commitment Corporation. supply Markel records. revenues continue and continue in markets, unrelenting Fourth, to continue ongoing of our are teams to operations excellence. challenges, operate performance Ventures National challenging National optionality, State and strength. to progress. chain make The important new of ongoing provides Third, go and two to resiliency, strength can't There pressures Markel to these that set the Nephila regulatory Despite records items them Ventures continues from hope challenges, of of set also for encourage doses tough to their the the million Nephila. sales from MGA we've note labor Ventures received Nephila environments I thank over part of new proceeds I two continues to burdens. operations Ventures is in Markel or of at the $XXX and inflationary profitability. The cash you. One and of to culture enough people of State that increasing

would what? underwriting modeling catastrophe penalizing of The the were performance at the The well markets mean? returns. Wait, funds Fifth, that what our results down steadily both recurring, buying but But of Markel we that it net buying. $XXX we months Nephila power surface, sell prices. that this of earning for That to If that to true. losses, is as bond were expectation be investments and interest roll another be by past, more demonstrates the stock that our Fourth, investments. to senior future. grow. stock. If markets over time, and losses impact the lines exactly developing be would circumstances methodology, other going I'm investment year, we delighted does year. far and That we've income going the of what you That investment to of is long-term repaid we year so time. and we the Secondly, income first Ian million Sixth, of and overall through just continue doubles and down depends. own the had million the loss were would receive are Markel securities equity and of fantastic. down, If $XXX the reported answer well-known and in amount to going decline That's were and bodes same our to repurchased recurring awful. almost adds like income We're On today equity and nine we difficult interest okay current last repurchased with stood our process expected along debt, markets that. dividends creating the higher probably you industry expectations. at are industry storms that track of markets bonds are and not wonderful. report lower the our

$XXX During the quarter, that line million item million. grew $XX XX% to from

increases I hand. I reasonably recurring, To to foreseeable for see our the income to investment call I ongoing think can recurring like in we Jeremy, over before turn expect future. the summarize,

and in own that profits a additional at You, shareholders, this operations our has insurance return long-term shares. securities, investing We're Ventures operation of rates insurance positive profitable as opportunities, publicly-traded own grown. our

You're investment we. good from returns your hungry and are so for

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this the being better and organization for like which an and Tom, communities win-win associates morning, customers through. of the others off you, who talk I'm good of proud must associated importance We follow being Thank Ian tirelessly It's that virtue and of supporting and the are people people often Florida are strong we to and our of us look is Ventures restore, incredibly their at have everyone. claims local remind to remain where settling our with. our for supply events impacted. wins Markel of our we time. be this get with materials building continue been our pleased performance that actively of the to We insurance on and situation, help the Whether feet to back to improve operations. with of with thoughts of working of Markel

and We Ventures against quality businesses. as to are Insurance the we portfolio plans and confident in durability our as of ability well our our within operating our investment as execute

three allocate building shareholder long-term We Overall, capital solid focused remain find it's pretty the a engines, to quarters on been opportunities continue we of across and three to value. year. first our

$X.X to $X.X surpassed first XX%. underwriting increase XXXX gross the our compared an billion of results, premiums to nine first in Looking billion of months for XXXX, written

policy new rates expanded retention premium levels, more strong increased business Our reflects volume offerings. favorable and volume, product

general continue lines. lines liability to other Our but the many professional product product liability lead growth also meaningful our we achieved of across and way,

was Our XXXX. ratio the first for XXXX consolidated months and combined nine both of XX

months. catastrophes All associated first $XX or from ratio combined million were to net conflict, Russia-Ukraine conflict we to our attributed first unchanged. four quarter the million with Ian, of losses In attributed net recognized the event combined of points this ratio. included attributed to Our Hurricane year-to-date XXXX points losses natural initial added estimates million the incurred in the and the $XXX $XX which remain combined to Russia-Ukraine XXXX, nine losses and two in

settlements Excluding impact a first for one. prior XX% year reasons this months months economic first segment. of the experienced reserve developed these due last nine liability as first of have general we less losses XXXX, lines by uncertainty to certain our the development, loss loss year. the same lines loss and claims frequency year, in impact the compared year tail the of for favorable in consolidated With settle by social to be to on prior year severity an favorable the million to increased million year the $XXX and trends ultimate $XXX impacts year compared increase in longer our was reserves product combined more development liability. reflects period and on claims of months liability In from both within incurred prior ratio. ratio such development accident this The inflation loss professional offset will The claims, around regards our the XX% that of years, created lower expense among Insurance was year reserves nine particularly favorably of greater-than-anticipated last to nine partially compared product professional lower and our to

a in particularly reserves we on years. are more cautiously, result, prior loss recent year accident approaching As reductions

we we're claims increased frequency any anticipated, of As experience previously to or I've loss instances increased where our our periods waiting In indication we'll in and with following often of are more expectations. responding are favorable quickly we of evaluate previous trends philosophy, over severity and our last our reserves, to consistent quarter reserving claims additional stated reduce excess reserves than loss time.

the gains to public included net the fair driven Turning value our investment our of primarily market $X.X This declines in months by for $X.X attributable the billion months value equity fair during year, our net first results. of portfolio, Net value in investment to portfolio attributable investment markets decrease favorable movements. to of the equity by losses the nine in billion period. in of a compares an increase income first last in the to the were driven significant year nine of equity were

times us long-term we performance. heard before, you've say As focus many on investment

cost our and are gains variability maintain will investing of equity in investment the understanding result discipline, to and and be periodic and to the the continue the expected timing We markets losses.

up months year our and recognized higher-yielding Net on of will of same holdings method to purchases of slightly We're ago. The year. through in offset compared average reflects the by see included cumulative of equity the the of interest purchases average unrealized quarter $X.X investment and will impact this fixed At time. the higher-yielding over a of yield $X.X higher investment on maturity our compared to million rates to impact the compared reflecting year meaningful impact nine compared $XXX billion. periods current beginning equity to the future returns this the to The longer regards income, last maturity reported value with this value a book investments last We to yield September, maturity this year. of in year. decreased resulting mature investment to maturity rates. securities. fair of months $XXX first yield income the to securities year, fixed securities the the losses net year from during in replaced method nine same equity billion year investment fixed on be income was this new year the holding last was investment first become our from benefit as -- decrease our exceed net taxes interest lower second income gains fair portfolio of securities we Net more continue to the fixed the investments gains end net period Beginning period this million mostly of book in measure periods continue With in of unrealized of securities. of increases year, portfolio. on higher portfolio, began our in lower-yielding That recent decline in of

future reverse hold typically as our maturities reminder, generally until mature. fixed in a to these As immature. bonds We expect losses unrealized periods we

or average and AAA rating losses an expected of current credit portfolio. has portfolio there within no the are Our

results Markel Now, Metromont, increased compared billion of from the months acquisition of year. to notably organic months businesses. nine for as the period August to Revenues compared the of $XXX well well in as XX% as of December million Markel many our The million the Ventures $X.X from XXXX nine same growth revenues segment. year. XXXX Markel acquisition increase higher to of I'll of $XXX improved as year the contribution Buckner, for $X.X reflects Metromont. cover the the increase contribution most of reflects of our first this period businesses our across Construction was several billion and Ventures last businesses, This other first revenues last for results Ventures our and XXXX during for EBITDA same across operating Services

year. first nine Looking the at of months our this consolidated for results

shareholders equity a results portfolio our and create the compared magnitude principles, portfolio, same equity billion year months which months to at by Our of Comprehensive to shareholders core require for to income, executing attributed common nine changes to well businesses. reported which comprehensive we and shareholders net nine $X.X a believe was navigating of $X.X the common in to that first we year. $X.X ago. to of was for the year-to-date year first driven equity million of unrealized billion for in net revenues level. how securities public net shareholders We It's the highlighting equity that both the swing largely year-over-year income first This our accepted gains high the loss was environment our period valuations. operations accounting months can a this are on include fixed generally in income performance and of economic of strong this $XXX demonstrate the losses compared valuation. volatility in in loss nine net last billion obscure maturity operating and income, to Again, the of public our worth given current

cash period volume. in Operating cash of was in our $X.X Again, strong last provided to flows cash compared the in balance nine first of I'll Net Total months billion at $XX.X sheet. compared flows the equity our and in year. the Finally, $XXX this of business. by July capital a operating I underwriting public billion to turn from $X.X that, comments talk this $XX.X XXXX, stood share And the we operations over to year reflected decline by billion it cash under first declines XXXX at flows, discussed. retired outstanding Richie year. the growth at shareholders' given of few nine end I'll stock the as X, XXX,XXX to premium same Insurance notes. our the September the on and X.X% make previously of to program. billion activities in fixed both senior more we shares maturity repurchase end unsecured driven our repurchased million during valuations, is about With equity our months

insurance operating within few results years. adjustments past good Thanks, partially was over and underwriting strong This appetite businesses and produced strategy another reduced catastrophe achieved quarter property operations. underwriting from our morning, of volatility the in benefiting within our through Jeremy, everyone. our We

for In a would four to event. size a of includes underwriting adverse ratio combined industry points of our catastrophe a quarter quarter combined Our event years, the previous of on loss Hurricane more significant catastrophe added ratio. impact of have impact Ian results. Ian, the third XX underwriting this our had

$X.X underwriting years two production We continue lines to see passed quarter XXXX. operations. premium in for for production product achieving the billion year-to-date both exceeds strong top the for the line total within growth underwriting underwriting across full our XX% year nine our periods just ago months. volume This growth the and Total

we to of operations, across also rate new our While been continue on-boarding has production new and increases the single-digit growth, relationships. products business development underwriting the by growth from program our influenced new mid- benefit of to high significantly

a scaling XX%, representing we year a from with our focus prior in on cautious and year takedowns reserving approach discipline in philosophy. Jeremy's Our quarter comments, recognizing my expense year-to-date of produced with remain two-point and comments our reserve a operations last Consistent conservative keeping our ago. improvement expense loss to ratio

we versus years, cautious most While about seeing more in are of from various the realizing are impact forms loss many fully in understood. delays are product favorable the our these accident actual lines core being until recent inflation benefits potential and of we expected trends processing

program engine, operations I'll our fronting discuss year-to-date within and and underwriting our operations. which our Now, operations, include results securities our services insurance insurance-linked

liability and rate while product our combined year included which general growth professional XX% most million growing the major Premium The the all XX% this segment for $XX was earned or first year. our XX% Insurance current nine The realized segment combined the into year dive or compared in of the nine the and of of written ratio lines. first ratio let's segment to across premiums to compensation Insurance months for premiums liability higher last months just the first. to under points continues We exception XXXX catastrophes. XX% two with was and in So Hurricane two year. the the net Russia-Ukraine Insurance Gross up million related in small just points were year, face growth workers' losses Ian premium of of net versus war losses decreases. lines or notable related over $XX to product last

by flat year was lower Excluding development losses, lower earned less our due favorable the on combined prior as the to our points accident liability by higher expenses. The such U.S. favorable benefit relatively books. increased ratio offset and prior event to impact operating in these by general on lower premiums development professional liability three from partially expense from takedowns year losses, due product ratio losses driven longer-tail lines, and a

mentioned taking same at realizing in we year And I reserving pockets accident are loss time, As takedowns. quickly approach our adverse of conscious a earlier, prior are development. the we process to reacting to

year On year accident prior general accident We ratio increased basis, remains trends. within including pricing as seeing attritional attritional versus lines responding current year-to-date claims the in a we also loss past down slightly trend. reflect actions claims current the inflationary the the quarters ratio year to few to ahead are modestly loss in quarter our our these trends and third been underwriting product have of

favorable import This and was lines in premiums and to up higher general adjustments offset segment general premiums along and to driven by from segment. next in liability months property nine lines. by written compensation our new business of earned growth to impact favorable the lower from the due liability due workers' and rates first Turning in year. and professional partially our and the liability surety our X% more growth premiums non-renewals. with was within renewals Premium higher credit lines for our to were reinsurance Gross both the premium

or months our strategy as decision the quota significantly in combined to discontinue and transition Our The first property versus Reinsurance XXX% from two operations. treaty resulted run year reduction catastrophe of XX% was with exit segment's nine the to catastrophe $XX volatility, within quarter. large to the benefited non-renewal of year points underwriting ago. related of to The of writing the current of the last share the XX losses year Nephila Reinsurance line property to in events. ratio our part due transition the combined year property within compensation lines of or net retro the is ratio line XXXX workers' a reinsurance compared business $XX million million reinsurance continues segment our The of our off and first lines net for of losses points results. Ukraine included in our the reinsurance a to property retro The underwriting reduced which war

this development had impact year loss surety points impact from ratio favorable due from primarily related in to combined four events, year. the two adverse Reinsurance these year including on favorable was to adjustments. the losses adverse by ago, to of our within and development property development decreased by property attributed a last three Excluding points segment offset accident Last lines product and losses product loss development impacted prior from of segment The by the five versus credit development of due this partially favorable adverse points lines, year our segment points primarily COVID-XX. year the year development, year, to premium prior favorable

target towards XX%. combined We continue our progress to ratio of make

sitting a Rhoads and the year around results. are at Significant ago. our efforts and financial a cat a reinsurance re-underwriting we're year-to-date, portfolio in reinsurance through specific to versus show XX% XX% by events, starting Jed team Excluding made

the operations our of As XX-plus we year contributions to of including an the him global after at his We announced last reinsurance the thank successfully quarter, reinsurance repositioning retiring for profitable be going end in Jed industry. growth. all to sustainable, years is Markel, incredible for

both which reported part operations. operations, our Next, operations our of as I'll of are other touch other and on in funding ILS services program

all our other is reminder, fronting gross and the within operations ceded. As written a of premium services almost program

our and billion disposition associated our year, in from with program quarter operations sale remain pipeline. production the in with our million in Within year of of transaction. continue Our to the first of revenue Margins this business in produced We that from billion gain our $XXX operations ago. of MGA the total primarily February. and revenues of versus year funding versus as October consideration last the for billion fourth estimated grow were does of gain XXXX. million, year this year up in operating cash management $X.X $X.X our this premium be XX, under Nephila business operations, year area strong, $XXX down results. last which other to new services Further, of XX% due total our this MGA $X.X of an the finalized Volante Velocity will of from a Nephila's as $XXX September assets recognized quarter million year we recognized were a

While fatigue assets under will strong. look a consistent loss the significant conditions we we few around were impact Nephila's Ian I'll activity and had adversely end cat year management. estimated investor investor comments an finish recent for this with to event Ian Nevertheless, and invested continue the to significant the impact of as outlook on market about expectations losses Hurricane magnitude. returns, with a

happy are knows, Q&A. everyone currently to be of think over engine take I transitioning I leadership questions Noble. And As and will we Jeremy during our to he insurance

Ian. violence, as As to terrorism, gradually peers' Ukraine calls, cat and which political and be including war lines. in has moderate aviation, been I to the rates in lines impacted as continue by such many most of Exceptions noted noted Hurricane war exposed property on continue earnings large our events, other earlier and

continues industry. financial a Inflation for new related see slowdown. to despite a fears to total and to and and economic potential markets premium be opportunities continue in strong all the us writings focus significant submissions, business its We uncertain forms

inflation I last going As pricing had our baked and we quarter, reserving. 'XX, discussed into into more loss already

both even year we and our picks. cautious third loss During approach, more year current reserve releases quarter, accident our accident an which the prior impacted adopted

trend. pricing been and they inflation, products always positive be our until trends quickly claims this has Most be slow respond recognize As adverse will bases to offset are to philosophy, confirmed. some and by to of to extent can trends helps impacted will we potential our

this rely maintain to However, to we are on adequacy. not rate prepared

lines We factors market decreases While see risk price see in previously no have have we been price for all discussed. more overall disappointed conditions business. the certain given justification favorable, remain competition absolutely to of we

to for from prepared are not and are going push are away business continue walk that We rate is to must-have we we adequately to what increases believe priced.

to positioned our capabilities. we and of year both given Fortunately, a in act a the similar strong discipline broad end We finish ourselves we hard this diversification in combined We to this turn Tom. for work of the team know like Interestingly, the goals now continue And I'd it Thank time over our feel we're at year better. to will achieve third a with to our goal. find and of or XX% to well position product XXXX. quarter ratio grow profitability remarkably profitably you your need back today. to market-leading to pursuit

three circumstances these at that of our and for gratitude are firing days our overall hope opening comments. optimism I you, Markel engines I my Richie. how all Thank conveyed and

the to I for I questions. point think just best this at open the is floor can do

So with Regina? that,

will session. the line ahead. [Operator begin question-and-answer now question will go We with of Hughes Mark come first Instructions] Please from the Truist. Our

can doing what you slowing? seeing be you signals terms things wonder the Ventures, say kind getting about signs the at you're look any whether insurance Yes. pretty of economy say you're when you also may of curious of operations, I well in construction your and is

it's response cost, that incredible you value what in the businesses see in I'll windows it's to is the done. have see time, at inflationary is It prices through tell through pressures. challenging. business And that an what hard And we're there's the economy. and plenty increased would underwriter same be have various each across we But issues we single what continue Thanks dealing to and and to business individual is, both every to of with Yes. labor the supply Mark. issues, increase and we

on So on. keeping it keeps

Very good.

obviously, Reinsurance within I segment, think create other going in reinsurance insurance look spilling segment at that well? or property post opportunity the is Is as up. when that you Insurance to into hardening is the And over lines?

Jeremy. Maybe Mark, I'll it's start that. on

out, point and of the to think certainly there's you're property story. part right I is

lines also story. I part and this the of think aviation of marine are events year's because

if programs. So, is we more conversations table bit think relative of our on our the scarce, is I a inwards to that it I The we where capacity and we're a see see think are And from firming we're table little at programs, a little intense. and opportunity. little more creating a the outworks definitely

has that that, anticipate well. would implications I across lines specialty and casualty So as broader

few the going little space. we're you I where more space. years the next more, couple reinsurance But lot primary seen it's say would of the between So, last bit in a months. a is the hardening see to we've base now think, insurance And of differential right I in in working certainly over gap learn reinsurance the house a

Can in really think of written this description pockets in you've competition, the XX% about quarter? hear of your insurance, price in your been about careful inflation. I growth

seeing also optimism seeing still all opportunity. the You here? you're looking that? in at growth but say description and -- of caution of square P&L pricing the increases the of The are kind in lot versus you're a language in written the that moderating, premium way good to the Any

We people. in is the I things We good think the way language will your always Mark, we're been. way always to and be. we speak, square have inherently it conservative right, is, are

want to So want never pretty take to things we good. for things, good but are We granted. never things surge

insurance demonstration time. at And that. mean I operations think we've Mark, is quite our work this the been across to I'll for of maybe, I a that add hard Jeremy, some

we multi-distribution So capabilities, strong global diversification, I relationships, from platform. trading product think a broad benefit

achieving rate. got new We We product are innovation.

what but laser grow, to profitably. on us allowing is we're growing that's focused So

the put to rate to degree bend for same act grow the when of the importance or us we've So importance high the to what quarters. importance table as think at. at I portends time, That for from discipline of adequacy, think got comments push discipline. we future And away with what present around the at that's been at and about work that the we have of ability I squares the down the hard opportunity a well knowing with as

with Our ahead. will Dwelle line Mark RBC Capital go from Markets. come next question of Please the

was through that caught out somewhere that CATCo. interest? Am I results else release back the $XX.X that then for plus other in were there reserve million correct a passed and Let up may me obvious? that the accounting that? you have to minus or minority pass-through understanding It through not question. guys with start The any line one effectively of just Or related been an was

it's Well, make you account. a great Mark, Jeremy.

It's yes, you're really exactly So right. just geography.

is pass-through a straight that So, any.

We continue to down wind the reserves.

is continue there non-controlling the original that to savings the of below kind that are as the benefit line. execute The offset see of interest we where sort computations the We investors. in benefit the to come favorable other through the can, of a through We where expenses. passes

be of aware Just that.

Right.

accounting old retained Okay. And be of professor would my proud I any that it.

an still for and equal, Jeremy it's anyway, thinking improved accident on reserving Richie. as picks. I the your else may of as the inflation that think? caution could year second course the been pretty about for and inflation. on I mean, that mean talk we're all just been got I that kind have increasing -- have you've question we it year-to-date, Can kind have be evolution -- probably So and And margin. still, I and severe of about this Can the the we've the obviously loss guess you some talked the of not right to talk way your over decent Yet, year? just been. it could pricing I Is of guess had on better you

Rich Yes, Mark, in. I'll maybe will start jump and

into of way I to our rate or has rate that just I think line keeping overall, to certain acting well. a numbers and by effect a an feel we a line get think underwriting certainly of in that view. are exposure necessarily good to won't But of inflationary is environment, and that And degree an trend. as expands like acknowledgment that actions ahead think

So, why are focused we that would is were even doubt, on be stronger. elevated the an rate environment, a without we results If adequacy. inflationary incredibly in

and more the That's measured anywhere to focused us approach very know upon in think reserves, on quickly more so I you taking long-standing you likely will, we view that's on good case Richie even if than where a now. to think deficient, a touched more earlier, philosophy I well how cycle, news, to this and focused with over very to bad have much reacting we a regards but redundant are news. time

despite we generate stage. We for good I generate think, place, to maintain take loss reserves, pretty fact, still at a can combined like in a we XX be ex-cat our us can this and can were confidence prior patio basis, certainly on year So an or We but I a that year feel still that's mentioning. favorable development. our Richie can, environment, right, those and actions in improve

inflationary like just been just Mark, anybody -- quickly, I'll I'll a just It's while a seen we've since seen has Yes. ones pressures the add real recently. add.

reeducate rest I And having people this not. kind inflation, lot kind accountants, we're of I of of to seen around the of mean, but have the have so, here actuaries, underwriters, Tom and a everybody.

that's So, happy at -- we'll that to are that decreases reserves. we Markel, the means great. want. reserves more And sure But this first always I the the confidence situation. trying the there's been has road, of safety think it current make to at if down it's that reserve level in and terms how we're potentially than view way we're that's And some

appreciate I with directly to that mind, questions two in that raises point. kind comments. maybe guess And follow-up it I of those

conservative then terms kind first And signposts you're and that of it in inflationary go year? question. conservative? what willing the mean, merely accident looking would if would you're the be Or would not you're second, the picks the margins still be accident improve weigh would to that So reserving, case back thinking the I year than pricing of just at that you about for year not environment that more you next are plus the to you're far? That up now, trends seeing, likely move as

this you're of know thing and to releases I and to because think we accident true increases see right? but what whether know potentially also be going improve -- I to things picks answer, be inflation to rate to prior -- we margins it. able hard variables, the reducing our the market loss going lot need hate are time. what it's the know say unknown of next rate start don't We don't year true year, is a got is. We that to increasing we need

take think of risk will matter be factors, a I I -- matter a just current it's it's more to think given it So time. time. going And

Yes. I'll formal comments in accounting just, some jump with here. Mark,

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Asset question [Operator Instructions] next Management. the will from line of Our Fox come with John Fenimore

Yes.

congratulations on no and $X been a decent there's forward? some invest the investments that results. talk short-term the investments some $X would of reinsurance you increase billion of you there going been doing billion And today? cost on about cash. time for a for Tom. of and have Can short-term today, First, the that. opportunity opportunity number quite return. But to is can for about although make rates, yield holding and Tom, you've another short-term I cash And you cost questions of

so. news is, pretty good hindsight, issue it in a that a retrospect, year of while over chatter lot the conversation the Well, about there's good and looks decision. or last With in

about same we'll disciplined methodical a terms iterate steady, return position, the And into steady, always the we and cash equities do We'll it, incremental, So at going steady, to own we market of are the iterate, going talked repurchasing all a to avenue And are way. we're of it market our once. crystal that in incremental, thing return. ball. just do, of incremental, as better But invest on the not we iterate, chuck no buying profitability is steady, given have I'm what I the rates Well, continue capital stock. and month do going the forecast, steady, in up. to deploying to work.

okay. short Yes. and investments, short Or you could that? $X.X thinking about are that million duration, I and to that's term, be like of short-term right? X.X% moving pretty where X% guess billion you we're billion of X%, earn X%, Could $XXX on corporates on

what it It's Yes. especially to awful, had. not compared

very That's clear.

but John, you always want what will Yes, many with they They where ago do. do, many, may what not about conversation you do they can do always you a the will I to made call they years Mark House. them comment say

reverse, a in our and you than and doing but I roles if we would agreement, it are pace might little you we're So thing. will the same differently

answer very Your clear. is

this. to interesting reaction The I -- and other sometimes income lecture investment calls, that get And your I account. like on would these point on say on and we an

income you about from better I think million of includes net read actually your Q $XXX income million marks is investment net of I If suggested. Hagerty. doing correctly, than the investment the $X

Yes, I than think it's actually more that.

around that conversations -- ever. those in one I and equity investing with an So method the be me, and here to starts accountant believe those that's of used

same million, think there what's -- years So, ago, we for on each it over $XXX was experience so recall one up quarter. It's was grow way probably swap do come instance, default yes, time, that I or numbers. XX of credit cumulative depending we've losses through that or well end with those the happened that really economics. in indeed equity a but long we And of gains and having loss two with whether million $XX of XX obscure and was I $XX cannot the time fundamental swings quarterly when The to that that recognized made it one Precision thing million method we the both investment mark-to-market over happening wonderful accounting gains ago. and

the So recurring, why year. queue that's and term right, this you're the of income reading investment used recurring net I new

total the things. the number on about months, through first the in is method equity $XX nine think I million

the took out the of faster income, investment recurring going rate quarter's a what was net it this and reported up is that than at with recurring, If you mix results. in

John, it's Jeremy.

piggyback to here off Tom's John, piggyback, just comments. to Just

of are included line investments method All our item. that in equity

So it's Hagerty. just not

is point. shift that make to $XX then right. The million. want is year-over-year And exactly I So, Tom

$XX So we'll on being million. nine-month $XX a down instead of basis million, be up

my That's Right. point, right.

Yes. Exactly.

income is on way equity. right investment to and the think about return it? from portfolio recurring increasing growing that The Is the the

Yes.

the the on on $X.X billion worth than right? more add injury Hagerty what's to insult And statements, it's piece, to financial about

correct. is That

Okay. And then...

The is our we've recognized losses. only thing it so billion. Yes, call ever $X.X

Right.

you. question then, And Tom, for Okay. final

reality. take Is there talk about a anything expenses, it's the anything that venture the that sure, about I you if quarter? revenue a third on which products is, the seasonality? side, products, and not subtracted Or On reflecting Could at margin, is the there went X% look unusual? in I I'm

to and mix going the a know. high skewing way things volume, extent at in don't Yes. low about, businesses, businesses wonderful exact of thing but are have moment, is on one is but distribution the of on the of think that have profitability at that the margin, know terms I be EBITDA return that those bit book I of you're about the know. the to the the and I asking look capital. don't a And would set we

expect the Okay. big the been Great. Is that quarter table? from you. investment And up quarter. the profitability, for that their a to things ILS I That's year. then, you for hurricane? Or fourth year? Richie, Do Typically, has trued best happen as off had get again with guess this

look on I where be guess I going The fourth focus be released terms you you is making of stand when of time because quite to see usually is that capital say, I'd know don't if I get of quarter hard have this will Ian, and to -- reserves that John, the also the say, cap this raising. sure you they do bit pockets for I a Ian can at don't simply year in that there's like correct trapped side you know. and releases just fees. think

sorry, So I is know. guess, the I answer don't

it. I Okay. appreciate That's fine.

like conference closing the any to over would I to session. question-and-answer Gayner for back our Tom concludes This turn remarks.

for about joining you Thank us. talk in to days. We'll Be you well. another XX again

you Thank conference concluded. has today's presentation. call for attending now The

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