FG Financial (FGF) 14 Nov 172017 Q3 Earnings call transcript

Greetings, and welcome to 1347 Property Insurance Holdings’ 2017 Third Quarter Financial Results Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I’d now like to turn the conference over to Jeremy Hellman with The Equity Group. Jeremy. ahead, go Please

words and the new our in under between should event events use of otherwise. or presentation management much, XXXX. our date generally unintentional results, are announcement call for morning, made, The December Holdings’ future as factors estimate, statements When are US the information. differ of should, discussed ended outlook, nine only Factors of and of risks occur this quarter they of Risk filings. project, which any very the and of by any year the the management statements business company the Form information unknown not factors the obligation on the its result such information, statements, and financial or XX, similar certain known the of on non-GAAP company, industry, may XXXX Yesterday, difference forward-looking materials public speak and result in a anticipate, its to may, the the forward-looking issued words and subsidiaries publicly and including call, risk used On no operations, measures, results. the update XXXX our regarding insurance Such believe, months entity. as GAAP. and make and The securities circumstances rely you and in investors expect, forecast section identify the forward-looking markets discussed to may everyone. could laws, XX-K a we as required events which equity affecting of regarding applicable subsidiaries forward-looking statements risk good forward-looking uncertainties as businesses. financial whether companies, the third may economic discussing based are are Thank each Property company GAAP its and on on materially Except expectations the In Insurance current factors undertake this not the defined or revise

reconciliation I’d the GAAP these over Doug a turn of that, press measures, our With like of CEO For Raucy, financial directly President Doug. measures call go release to Please Property most posted see website. to XXXX the Insurance and comparable non-GAAP on the ahead, to Holdings.

overview strategy you, and by will today’s the year discuss joined our several from quarter, our financials, John be Hill. I’m expansion Financial key quarter. takeaways for to want In our John the and everyone. remainder to into that Officer, of an reviewing pleased call Thank and the key of XXXX. then highlight. outline welcome, the I’ll Chief I’ll begin are themes on our with we there

First our Texas. following Hurricane storm and foremost was Harvey in response

with commitment industry DNA our into and founded for by Our backgrounds. customers holders. of at the heart Fulfilling to veterans translates policy experienced real benefits our company was is claims extensive our corporate world

is speak reputation. their homeowner house was proactive minute. In centric our difficult everyone their hold of I'm response our a with would to out less to thing strengthen and following our insurance and surveyed than specialist, of brand focus last on we forced to these The While claims prefer our continues events being phone one time the with wait say company. claim sit response when after a average to our to one by do that storm, wants occur, they our do, customer galvanizes proud not days Harvey, involved and

customer process the So the aspect priority high a of focusing is on service for claim us.

made a this with of profitably XX%, above similar again, reiterate the is with and Irma related heard to agents goal does able Florida than Harvey respect to When claims. is of for have their we XX% grow continue statistics claim As that our expect we closed of discuss claims. October in have what past our independent and A over hurricane was XX, to response better some basis had our significantly make we insurers, in point that of be particularly really it will their we difference. on customers, to I that policy one the options with business. That

us. direct The At our XX% force approximately business policies second Texas, September year Texas, with continues the versus acceleration Texas to X,XXX The to in roughly is sales our in number key We a of pausing recent especially total continue, I-XX XX, be ago. the state. now Corridor in competitors an trends be theme for in we from the of continued appear volume. our their especially efforts represents our quarter the of the growth had will which think X,XXX in activity state of following part active who

for our upon We build specialized focal work preparation to are confident comfortable plan our and our point writing Florida. business in continued initial A we’ll continue in in growth and our is strategies. third

the and depopulation in citizens participating expect in be state. will that in December upcoming presence our jumpstart to We from the

have the to extensive for network participated very will with. With As Texas. with policies Louisiana, policies. depopulations, positive. this we go the far associated experience multi we payer been in importantly, the very issues in to think into Florida significant experience depopulation us reception experience in extensive business those the is as AOB We have respect to upcoming develop having thus independent a general, clear policies, to as are of we homeowner this Texas have well focus designed started wind-only market has agent well mitigate intend and And approach be in in We our reminder, going windstorm we as seven terms Florida the depopulation with a have last targeting. will year's and serve

moving In addition, rates we do Irma. begin to expect up following

be through as to patient opportunities. down of we greater at your in post to disruption positioned companies number John questions. cease it time, some well current the While financial turn believe market I'll results our in or now return go think to doing approach business. our the to financial been couple of that Having is will would easing John? deployment rated from of comments competition same could terms capital, of there the take storm benefit we a due get and and a final and like I CFO, now to for PIH then Hill, detail, over and

Thank you, Doug.

information. which go Now reach for month you I for our the the of financial will review financials, to I out filed evening highlights everyone briefly if here. team and about through our you additional yesterday Form were the release have our additional encourage course, nine press can questions And quarter. or quarterly XX-Q to

as total to XX,XXX force in XX, and XX.X% September XX,XXX policies XXXX in as are over XX, Brotherhood of from assumed year XX,XXX Including policies of policies we've September and from up grew XX.X% force our policies that direct TWIA, ago. from policies Our XXXX. a

in our continues of over business noted, our growth obtained now direct As with policies lead to agency and XX,XXX force volume. XX, of as from from total were XX% of accounts XX% Doug in the Also, network, remainder obtained independent our our Texas XXXX September our Louisiana citizens. for

the up XX% Gross securing premiums as ago. the million, from quarter, We expect our as dual agency going earned from were in up premiums this forward. the were depopulation year earned channel, prior to XX.X% million independent benefit and Net period are from same period. second on $XX.X $X.X both continue focused a business, channel developing to well year

resulting for hurricane non-weather loss XX.X%. Harvey, net along XXXX with of basis, losses, $X.X core same combined ratio quarter which cat On components with losses. million Our a which percentage added quarter net our million in of from $X ratio loss as loss for losses of level define accounted last was were we losses Key losses the catastrophe core loss net with of XX.X%, XX.X% weather third quarter and ratio was year. the non-cat our of the

quarter these development third third was releases prudent on positive As the diligent point years XXXX, quarter. management the year loss in of quarter, of a net reserve development percentage the by are accident the second ratio XXXX case our of reducing period points. We accurate in reserves with reduced coupled our for claim losses feel approximately prior occurred percentage approach, one in conservative loss that net reflection quarter incurred prior servicing. ratio by Similarly, favorable favorable for the XX.X our included

our allows This XX.X% in to cost premiums amortization gross increase year's acquisition which deposits in subsidiary was year. over of credit a XXXX, in policy in and last against take second regulatory for banks. quarter due to the to a earned, us deferred percentage of quarter compared as third the insurance XX.X% to change our Moving XX.X% quarter taxes expenses, state for longer premium last no same cash Louisiana the quarter the Louisiana, was

expenses and the in for and percentage upcoming as this occurred general and in we external administrative our and gross prior activity a percentage Texas, as basis increase last were Our an the compared versus increased the period. invest growth dollar XX.X% year quarter absolute both in to of the for to resources strong support up Florida. state of internal year, earned, and premiums G&A on to XXXX, expenses XX.X% third

As third administrative Florida, we general we these begin dollar these quarter million expect incremental to write for XXXX to prior business $X.X premiums in the expenses On period. compared $X.X and basis, million was a year costs. to absorb

third XX.X% quarter net the XX.X% the overall to to rose expense in third from compared Our ratio ’XX XXXX. quarter

XXX.X reported a for ratio of third net quarter quarter XXXX. compared third company For the the XXX.X, to XXXX, combined the

As quality investments the agencies the XX% company's the including of high XX, in comprised fixed term portfolio. US approximately issued corporate by government insurers, and investment September investments, XXXX, maturities short of

of met. communicated to our objectives evaluated we are scope and that As our investment will our within plan previously, be being falls the ensure strategic strategy investment routinely committee by

share. the million a or of with last This the $X.XX of $X.X $X.X quarter per year. or share a $X.XX per XXXX, loss incurred we in For million compares net third net loss quarter third

was $X.XX ago XXXX. book declined value Finally, up closing back which losses to share XXXX, PIH per a approximately At at XX, XX, things comments. close previously. September our share September these I to year that, With value on share, per I’ll some Doug of from book noted of I’ll over result a $X.XX as turn

John. Thanks,

results, now never number are we in personal the year happy where with despite showing the it force continued events of on policies our positive a at as our impact over policies bad saw before. assumed, themes strong total when QX certainly but when are We and time XX,XXX. absolutely and we Including quarter earlier. the noted significant weather in impact the financial compared this on occur, growth is I was year figure That our last have customers,

XX, focus XXXX, last XX the our on months, basis, was it the count noted, we that a and XXXX, growth XX,XXX, versus On building strong XX% total has This policy XX,XXX. John larger managed over inception. before XXXX percentage our with As on over strategic the base. is since and year roughly the established XX% the September was grew period, our we've been consistent foundation despite

am business As we writing will I growth to profitable ready our in stand very continue we optimistic into begin XXXX. Florida,

expect a of policies a number business state, the We in Florida serve strong to upcoming as the time depopulation with in start the our meaningful to a market. opportunity at favorable in

that voluntary early will our We by business year. follow launching next

expect to growth. addition impact, In we premium our the have Florida to on positive policy and

in on in our to renew will one and to diversified our of spring business the of reinsurers, profile. our also event reinsurance. mitigating have in a of negotiate we risk ability initiation Our pricing both when eyes important, further results the our next enhancing This us allow impact of terms overall is the state any

subsidiary, that storm can the business in questions activity we specialty over excel well to any our over our provide may expected Florida, in continued surplus for Texas, Despite continued planned will in John available period, $XX to with also in given returns weather and growth Operator? business I we experienced we policyholders any insurance and increase do in support million overall time. will QX, are continue adjusted our and diversification that, should into which growth. term exposure in the capitalized, have. Louisiana. respect expansion in you I remain we our claims, capital to and risk With events increase it multiple believe value long While agents to firmly With underpin

and thanks. thanks Well, Okay. to look each on everybody. speaking you our of XXXX again We fourth conference call, forward again with quarter

Thank everyone. conference. This concludes today's you,

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