The Travelers Companies, Inc. (TRV) 23 Jan 202019 Q4 Earnings call transcript

Good morning, ladies and gentlemen. Welcome to the Fourth Quarter Results Teleconference for Travelers. We ask that you hold all questions until the completion of formal remarks, at which time you'll be given instructions for the Q&A session.

As a reminder, this conference is being recorded on January 23, 2020.

At this time, I'd like to turn the conference over to Ms. President Relations. Vice Senior Goldstein, of Investor Abbe Ms. Goldstein, begin. you may

our morning welcome you. all discussion supplement seen this of released Thank webcast of release, Travelers presentation and have Hopefully, our and morning. results. to Good earlier financial XXXX fourth you press quarter

the these under can at materials of found on section. All website our be travelers.com Investors

the They will refer results Insurance. Tom presentation prepared & today take and business be Alan the Greg webcast questions. then Frey, Insurance; the market and discuss as will Officer; Financial financial They and segment Klein of will Schnitzer, go through will remarks Presidents: our Dan environment. of they Bond earnings current Speaking our of we Toczydlowski Kunkel and to your Michael Insurance; Business Chief Specialty Chairman and of three Personal CEO;

I like would note the Alan, the to the call at draw earnings the Before over explanatory to to of end included attention I turn presentation. your

company any includes is of forward-looking performance. Our and involve future not a investors and forward-looking cautions statements. presentation uncertainties risks statements guarantee today The that

website. Reconciliations non-GAAP release, materials measures. section in or press our materially earnings those responses remarks and in financial most may are differ other the statements. with factors. recent under included and to recent do factors the in a variety our any may from the undertake due available Also, and results expressed of These in update or we mention to described Investors supplement not statements some forward-looking XX-K obligation filed forward-looking forward-looking press Actual release statements in on our implied to XX-Q financial our questions, SEC. in earnings are our We

like over Schnitzer. turn to to And Alan call I'd now, the

on a and thank return Thank you, us of was reported today. income for you This XX.X%. quarterly Good $X.XX. core per Core we share equity morning, morning, diluted record joining Abbe. everyone,

return is on us over grow, any and also equity manage returns use strategy before, time. our primary industry-leading over to to core we the to As strategy you've measure deliver time say heard business a requires

For the of grow attractive the year the that than record continued premiums written $XX our are at we pleased returns XXXX, billion. full successful resulted net strategy more of execution in to top-line very

the That compared our than cumulative underwriting top-line a are to contribution over to significant. representing three on growth its premiums billion more last volume our back a XXXX, made impact Looking higher rate and has meaningful years, Earned XXXX in growth compound nearly were $X.X X%. of annual income. results

business recent have of we're the remained We board retentions across have book very pleased that a high and in high-quality years.

Premium growth pure higher geographies we’ve added in and well. with know that over XXXX both by has past products, rate has the years industries, contributing. The pricing new driven growth we in and exposure and business three been been

efficiency productivity So, of with we're and benefit confidence. growing in volume. complement the Improvements

by enhancements. our This expense to that which expense a full-year bringing past marches and three leverage the efforts from ratio, quarter, our ratio XX%. steady had ratio our This prior was substantial around XX.X%. improved over and XX.X%, driven expense averaged to investments years improvement an to workflow technology to That

a Achieving at also capital we our in and further and portfolio, be return strategic to Importantly, the priority grow our gains strategic business, for substantial same continue efficiency to our time, make to continues investment investments excess shareholders. productivity us.

in benefit return gives more the without competitive objectives. priorities, leverage us operating our invest let fall flexibility and/or improved our say, us heard further on compromising to be the bottom-line, strategic the pricing, to you’ve As

plaintiffs’ bar. note by current the is social continue but issue environmental inflation aggressive impact past primarily in quarter, this results of that were comment I’ll course that from headwinds by also the environment. year, Greg will driven our impacted a to tort an the we Over challenging believe a more on

of business income For and core the diversified interest expertise. return on resilience of our tort that $X.X investment of persistent strength full equity our level to and generating year, low and the environment rates, exceeded and Considering core challenging profit return XX.X%. speaks billion, the

together grow share adjusted to our Our capital strong excess with $XX.XX value during consistent sheet balance shareholders, enabled year returning X% management our $X.X by after results to us per capital billion the of to longstanding book strategy. with

which written marketplace $X.X level both net increased Business in quarter rate and Domestic Insurance by billion, our XXXX, to production, marking fourth quarter in to premium change Turning the the X.X%, was in retention X% segments. consecutive all very growth premiums renewal three execution strong. of Net while premiums highest in since increased cases change excellent, we X.X%, written including generated X%. XXth renewal business remained was premium

Specialty has Bond it growth year & written premium and premiums business XXXX. domestic strong the net liability businesses. by increased points X%, quarter, management Insurance, our prior both management up over been about and In change the X highest X.X%, our liability in with Renewal since in was surety

remains historically XX%. high retention Our at

In Personal level business, our reflecting X.X%, Homeowners Homeowners. renewal its XXXX. since premiums X%, increased Insurance, by Agency in and change Agency premium both written Agency In highest Auto net to growth increased

shortly hear segment Greg, about and more You'll from our Tom, results. Michael

this on past it To a XX% nearly environment, equity. a In action, return we core performance sum us transformed, our year. called up, generated served to challenging well

chain a capabilities, to to across also related and hands investments new in digital sales analytic and and agenda. advancing the We claims customers responsiveness, our tools products, implemented value speed digitized new made increase professionals, out innovation ambitious our few. rolled We improved our of name broadly put just capabilities, service important workflows claim

important other and positioning and in into employees, extending lead to continued customers, for these the efficiency. future, namely to providing aimed expertise, agents, our experiences of productivity our Travelers priorities efforts great three success and brokers, initiatives deliver coordinated on well our and risk to of are optimizing part All

we are on deliver value underwriting, well capital, time. focus shareholders’ relentless and positioned team, to talented shareholder sophisticated over high approach to for our and respect continue analytical of deep our With degree execution, meaningful to

call I'll to over Dan. the And with turn that,

Core and XX.X%, was you, for measures fourth of fourth lower Alan. up million prior last The million, level from from $XXX catastrophe losses. resulted the XX%. up both ROE quarter $XXX was from a core from income year improvement year's quarter in in the Thank primarily quarter;

pre-tax. million Recall above for results billion of reinsured fourth cat million Our the of ratio recoveries include losses, offset current of pre-tax excludes of under which and point through had details $XX that increased more retention, X by of the I'll cats quarter which XX.X%, underlying $X.X third cat billion that and consists quarter, quarter. accumulated of shortly, $XX we The we impacts retention. million the combined treaty. partially the for prior treaty, $XXX which year cat in of $XXX net that provide the favorable the million losses PYD quarter by $X.X towards new were that XX% from PYD, was under events,

years underlying $XXX ratio quarter aggressive million premium. to higher this quarter modestly challenges full income to in offset decreased in net prior were increases quarter, made from XX.X%. lower by down non-fixed our recent $XXX year the strategic tort ratio environment, from million year higher lowest full in since fixed XXXX. to by than our associated in the a expense with reflecting returns pre-tax gain ratio XX.X% of expense the focus prior slightly the the and ongoing is was investment the Our year in of portfolio. The fourth levels million results $XXX volume reflect year from more progress partially brings related expense These and on offset as efficiency income of productivity underwriting we've loss level After-tax our more benefit income

given that expect higher to corresponding average benefit approximately more per XXXX on be NII offset will levels fixed we lower a income interest the to $XX environment. of we projected as a decrease by million of the invested of $X yield average by rate than million XXXX, In lower quarter will after-tax the compared assets periods portfolio

Business in net workers’ general and line. fidelity commercial reported surety net million accident segments favorable the & quarter. prior expected experience multiple included In lines. development favorable multi-peril performed and year loss and better modest expected reserve the than In three the experienced than PYD both and for loss in fourth we development liability better better $XXX about years. development In Insurance, than in Specialty, comp expected in unfavorable property auto Personal Bond of All Insurance,

expect When XXXX the combined our results to throughout the in we coverages. commercial consistent favorability the lines personal the P surety be the with and Schedule our commentary quarter, liability and second fidelity in is strengthening and filed early in workers’ comp, lines with year,

Page XX renewals. January provides the of information Xst our capture about year earnings presentation

cat for aggregation corporate line to XOL on events single multiple the cat provide with coverage both the for in treaty continues losses terms of expiring events. longstanding cat renewed and Our and treaty

a added aggregate we XOL XXXX, As catastrophe you know, for property to new treaty.

treaty take on impact First, to summarize moment the that our results. XXXX a let me of

as the when recoveries of surpass with did until combined full we recognize had essentially treaty, was recoveries year's by underlying ratio that's the not about to under virtually Because the total For the much benefit no the on combined cat the our quarter, combined expected, full on began year, point. under ratio assumptions. very by treaty. offset underlying treaty line as also our fourth ratio the X.X the impact The increased the in impact level treaty our we retention

no than ratio to So the on impact was fourth more underlying ratio. a impact on virtually benefit the X and the combined quarter was point, specifically the there total combined of

qualifying part designated Hurricane year’s largely XXXX, aggregate As year’s cap. in from $X events billion. retention aggregate $XXX North per and this million renewed in America book. for more, losses from $XXX of billion, property reflecting XXXX an million increased treaty we our million above earthquake will have growth anticipated a of for or to address last million occurrence of of aggregate dollar $XXX providing events and losses recent PCS The of for $X.XX again coverage retention incur once continue one $X.X which

the lower the the will XXXX. treaty year, than of proportionally of cost treaty in we last lower be Since placed percentage the

we be XXXX. year only a X.X impact point ratio. And non-cat underlying incorporating weather a roughly our minimal anticipate about we again full would once slightly than to less cat total combined So experienced on our assumptions the on combined would expect for the in we XXXX, and impact ratio

and were operating billion strong. better ended $X.X than with target management, again the All holding for Turning levels, quarter flows of $X.X approximately to billion. cash we company quarter ratios or were capital our of liquidity the capital at very

highest since XXXX, the light loss. unusually year operating billion, flow cash year, $X an was cat For level full exceeded which our

book Interest fourth after-tax shareholders of rates during investment accordingly $X.X after-tax $X.X investment as gain from quarter, and per at increased share, year-end. which Adjusted modestly September unrealized net billion billion the value decreased to unrealized XXth excludes our our year repurchases this quarter, $XX.XX the than returned the X% end, of losses dividends million. million at capital was We higher at of and year. million and $XXX to share $XXX $XXX comprising gains of of beginning

and the $X.X through we year, billion returned capital of shareholders share For repurchases. dividends to

financial note, XX a Slide on your the attention to earnings let me turn Finally, presentation. modeling of

As of decade. we losses to thought helpful point enter we would it be over our out cat the prior seasonality the XXXX,

regularly cat the on quarter average, and second years. been the the past much as see, second in largest have six any as losses twice our can Cat our you the quarter about second As of been in quarter. has and been quarter quarter has largest cat XX noticeably quarter other

over And Business of turn Greg to discussion Insurance. microphone now a I the will for

Dan. Thanks,

on full profitability income overall produced largest year of Earnings expense the segment quarter income, segment ratio increase For both lower growing improving line, and product quarter Business year fourth fourth over strong million returns of operating leverage. the the the business volumes Insurance at benefited continue strategy $X.X the as a as of billion. for higher execute as our the XX% attractive and compensation, we almost That XXXX. to a total to our and from for $XXX brings and our workers’ top-line quarter, well

the that The information ratio X the was the of quarter of XXXX. than quarter the earnings fourth We've for higher components change. on details combined Slide presentation underlying point XX.X%, of included the X

forward impact there's about the additional items from X see As fourth unfavorable loss X that changes liability quarters of quarter, the point quarter year. net can of rolled that of commercial on impact to a and includes from that, point the And X.X also items about prior one-third point with current point quarters. in of along auto estimation the three There's slide, the unfavorable are including you about with related new of net associated general our the first about in estimates. X.X from

the earnings the For presentation Slide full provides detailed XX.X% the year, year-over-year various the combined higher impacting of of full point was view a underlying items than ratio year of X.X results. XX XXXX. the the

in to on the provide environment top-line little our loss Before I'll context more tort the turning and international production, activity. a

importantly, of loss get feedback costs, best underwriters, tight leading professionals environment, claim and tort our loop data our we've the view actuaries. to leveraged leaders, the business and our Regarding the and analytics, escalating among

have book of grown targeted, with have We we a for a underwritten business years. which orientation, carefully and largely mainstream optimized

XX% of our limits policies or less. $X than More million have of domestic

Excluding don't workers’ compensation, limits the apply.

we and action tort the will the worsening underwriting claim seek strategies While our continue impacts pursue to from primary will to be more rate. mitigate environment, to actions

During the we retention, evidence were alone high in driving renewal in very levels quarter, meaningful in maintaining of successful not rate. which once change achieving again while that improvement is rate we're

environmental. our is that of All experiencing consistent is with that what we're view

significant elevated you production see increases renewal we've As experiencing on statistics been property XX and international the of these for the trends, as losses earnings Page We're lines. the achieving within presentation. address to can rate in international, pursuing

that, terms of we're variety lines accounts. profit of tightening pairing and and executing including to and improvement addition certain back conditions, a initiatives, In exposures

needs While making be work with of all more to these done, good efforts. progress we're

the for full the Turning year were driven premiums net and the in top-line, production strong quarter up results. written X% X% by to

year making the renewal business. progress broker contributor, base on new the pleased initiatives customer continues we're also continued strategic the we our and the feedback by and with our grew largest agent to premium our strong While and be We're encouraged retention from remain partners. for change through

from change retention was achieved high renewal last in notwithstanding demonstrates pressure change the result X.X% strong at and more In momentum third a continued premium of pricing. remains of X.X rate while The since XX%, domestic quality terms XXXX workers’ point book. the downward was This the fourth and change of quarter highest year. seven-tenths our quarter production, X of than quarter of rate of X.X%, from the up points of with of renewal the of our reflection X.X%, we renewal compensation fourth the

levels We across about increases fourth in three higher market rate this which our quarter year. of rate are accounts of achieving last middle above positive with two-thirds from up book our broadly quarter, getting the quarters is

broad the Slide of earnings A of is our further illustration of the progress XX presentation. on nature

slide the fourth of accounts our For percentage the rate the of and for XXXX. core three commercial XXXX business, accounts reflects in quarter bands renewed XXXX,

and increase percentage the declined, skewed of has flat higher historically accounts accounts a increase, accounts see or with the graph, a of higher rate level our of rate can our has other of increase from renewing is the while accounts words, a proportion the are progress retention you As getting percentage remained and high achieved decrease this renewing getting been of up, rate significant with rate has while rate with the at the higher. In increase, are proportion a more levels.

the of as we From year all business of fourth the of lines compensation in a to year. quarter line last of rate this outside perspective, and quarter third both workers’ achieved increases compared higher

business quarter. million consistent year was strong For the $XXX with the of and prior segment, new

of from individual the change change the while for both of rate in renewal XX%. select, fourth quarter year, and third from X.X% the businesses, of at quarter up strong retention As were remained renewal X.X% last and premium

New $XXX was million strong with quarter. business year of consistent prior a

We the and ease advance related business with to and progress product results encouraged of our doing investments are to-date. continued and development to

rate XX%. quarter up year, than quarter, renewal change retention third last points than at with X.X%, point more from X.X fourth X the was change premium while remained renewal the more market, of middle In of high from X%, and

benefits billion, prior from over year was ongoing well full our million bringing the slightly $X.X pricing quarter business new up as initiatives. reflecting higher New to total as business strategic year of $XXX just from the

lot wrapped the tort things went the the To the year well sum continued and notably a in most fourth quarter up up, faced which challenges, environment. of we some from pressure

couldn't return with all and and We local be great we the use are beyond. meet to will capabilities environment have confident that to XXXX other position and market objectives. our available We in insights continue a pleased our will execution well levers in we the see changing us more that to and

to underwriting call we our the results premium a be not will XX-K turn to over to change Specialty for outlook renewal on few want for our since I filing about Bond comment underlying result, I & Before Tom talk weeks. and

be expect Insurance Business XXXX. we in For RPC than XXXX higher will

cost the combined expect This be ratio underlying trends international improved in business. XXXX. XXXX the in excess We pricing our full results will anticipated earned for impact in loss the of year lower than assumes of and

full that product combined of liability year include of the impacts in the the of through second quarter as took forward actions the XXXX year general the come we auto quarters and fourth in third the Underneath ratio the outlook in first for roll lines. XXXX the expect fourth commercial of improvements quarters to second, and we will the underlying

turn that, the I'll With Tom. call the over

Bond The reflecting underlying volumes & loss Greg. income underlying year decrease the combined with ratios offset to management the the estimates prior combined of X.X higher that business combined million, liability roll increased we $XXX was of respectively. prior quarter, Thanks, largely coverages underwriting slightly The of impact year lower quarter combined of lower combined points $XX quarter higher quarter, the -- earned for from favorable the from impact due of a underlying strong year The ratio a prior than year forward underwriting XX.X%, you prior largely and ratio. growth. the last primarily returns of development. Specialty as delivered gain the quarter. was strong underlying discussed higher level another remained XX.X% million Segment at reserve and net and

production all X% we growth are the our up were businesses. for top-line, that In across domestic remained quarter, pleased management to business, written retention at the pricing premiums Turning our liability net change reflecting with consistent to XX% portfolio with are premium executing strong These results targeted higher maintain of retention X.X%. actions. very our high-quality at our strong renewal strategy while a

We increases, pursue will where warranted. price continue to

liability We strong domestic the market-leading for and and in disciplined investments the underwriting business, growth with our posted field commitment and Domestic surety services million increased solid both to new business quarter. our quarter management and products selection. our risk to XX% and long-term and with our pleased and $XX remain together execution international strategic thoughtful

over our Specialty strong & remained terrific top-line and Bond we feel time. about continue So, to returns growth to results deliver strong, with ability

we expect the liability terms outlook, be to ratio higher domestic as our In XXXX higher compared will combined each XXXX. will underlying for slightly of be and RPC business management our in case

XXXX, for Additionally, we business be with the consistent XXXX, that volumes will of slightly impact expect margin underlying combined will underlying offset underwriting higher underwriting -- the higher ratio. as broadly the

And now, to it turn discuss I'll Michael over Insurance. Personal to

good everyone. Insurance, our results. pleased we Thanks, with morning, quarter fourth full-year Tom, and very In are and Personal

For fourth was million income and quarter, XX.X%. the segment combined was the ratio $XXX

million, the was $XXX improvement million ratio For full of prior combined $XXX XX.X%. an segment of the year year, the and income from

The reflect the retention, results premium fourth quarter strong new both premium year, was continued benefited growth income change and also written Underwriting lower and for the from from of X% catastrophes. driven higher for X% and periods with by Net business. premium. earned prior solid levels significantly improvements respectively, full year renewal

of was ratio points, first the from the as quarter combined trends low loss combined our favorable period the combined XX.X% XXXX. underlying full-year year. level quarter pricing Agency delivered outstanding relative was the ratio combined X.X that of in largely benefiting the The exceeded to with the to the year, results is half losses was comparable prior earned XX.X% reflective X.X prior an improved ratio which solid in throughout for of increase line. frequency well point ratio XX%, XXXX. of of as and fourth The typically of unusually highest the Automobile quarter in a The

In XX.X% Hurricane to Other, the comparison fourth catastrophes, and quarter XX which year Agency the wildfires combined Homeowners by prior improved of California quarter, significantly ratio Michael. by impacted and in points was specifically

year. as combined loss prior non-weather the ratio higher XX.X%, year an new higher reinsurance XX.X or non-catastrophe primarily point The was On the for combined XX.X% The year, a losses was by points than XXXX underlying drove combined the of the a weather-related an X up excellent to impact catastrophe points prior underlying full X.X lower catastrophe ratio treaty. year was from improvement the activity. the higher losses, XX.X% to driven due ratio quarter, basis, and

and loss to discussed underwriting we you address of As actions with underlying higher to we've previously, continue levels take activity. pricing

at Automobile production, while with XX% growth X.X%. written X% premium renewal quarterly was modest to retention enforced, Shifting Agency business in grew strong policies net and new premiums change and remains

year continue to to with and retention levels, Homeowners net our make new of from strong written change profitable efforts Agency quarter driven progress another line. We double Other delivered XX% grow premium quarter. the and rising premium to higher XX%, business at renewal by growth in this the level X.X%, prior

X.X the of Home and combines sophisticated remain We now premiums rollout agents pricing mark hitting is quote XX states ease our form and the a higher of the Quantum simple coverages both segmentation, with and is pleased solution granular available and suggested District and and both Columbia. product, on with quoting, our has customers. of X.X volume which that Home Quantum a average customizable increased

losses. positive Homeowners Agency for changes segment but underlying Turning to improvement remain to lower. will expected is quarters Personal outlook, premium higher, a XXXX Insurance Other be that in second both changes Agency will lower for combined year, as levels for Homeowners we of Agency XXXX through Automobile and the The non-catastrophe be ratios whole the the will lower. be weather-related of Other fourth and expect renewal assuming premium while renewal This our compared and

the consistent. Agency to combined be For the is outlook underlying Automobile broadly for ratio

significantly and year it very homeowners a profitability a good was auto strong of Personal year and for in Insurance improved profitability. second All-in with strong consecutive

levels new domestic premiums, enforced. written net In business record policies and achieved addition, we of

profitable into capabilities our while to positioned the of continue value We that momentum well to going have enhance are growth, will in strong deliver franchise. XXXX investing and

With that, to back I'll turn the Abbe. over call

questions your take now. to ready we're And Michael. Thanks,

[Operator Instructions].

Phillips question Your Michael first Morgan with is Stanley. from

on X.X% But at the focus I kind last bottom X. and gives of about I'm you long-term longer-term a you’ve couple referred quarters trends. trends that you bit up know X.X% -- more here on that kind up time. thinking catch My guys of X% again moved I which you first know X. of Slide on last Slide a especially about to in the of Slide talked to X, question

still if X.X% is that wondering you're I'm you So, with now? think something comfortable that forward think how you about or going

it’s Dan Michael, Hi, Frey.

draw any what's the of any long-term to between I'll year. roll or and particular So, distinction sort quarter the assumption through trend going

we're for X.X%. year's So, you the combined it more ratio than trend. for environment year in that this of slide, long-term reconciling We we the our the to loss look difference between did and And a the view remember the last when change ratio. as clearly whole, overall, at was year's raise combined in

think in second we changed quarter, but about back I since haven't then. the that we talked it

more this reactions are the the seeing not data from in level that these current forward. to So, point the we're losses environment, but trajectory raising of

this kind year, it pricing better who tug pricing saying? Is obviously thinking the tug so because than underlying. the think guess a talks what second sounds I'm that Certainly, half like. of you're to loss between get get for were the in back to down. commentary your you're earned of And pricing went -- about of the right the we as starting the that I of better loss I of still trends war war you mean, in outlook trends, A obviously, being said lot now. of will into quarter, margins this quarter getting war I wins Okay. and is what loss trends tug

full Yes, that's year.

month The So QX to as remember, and made QX opposed that is we going QX particular to the in XXXX is done we really a primarily. in 'XX, that quarter-by-quarter is QX, compare we've of of QX broad comment to came be strengthening view when think a XX for outlook the 'XX reconciliation. what the environment of Greg

in of year be different a going that the than So to broadly. comparison little and more is itself

is a a Because Slide moving in. -- it just at basis, Slide full to make look little XX in it’s there at Alan. when of I looking Micheal, view sure you just X would too. easier year of take it’s encourage bit a that you're an lot it’s also you on pieces to

Yes.

Okay. the for question appreciate $XXX No, thank guess, was piece, guess is, you. the adverse was side on Business liability the of year CMP you assume the color Insurance My comp, helpful. PYD, on I I that And gave of on guys to I million talked then, that there if I more the Are kind second I that. of guess into driving kind driving confirm is tort CMP. I liability kind just from CMP the of piece? -- so, leaking you GL what's or want of accounts smaller that? down seeing environment of what's that about

Dan It's Michael. again. Yes,

is the for that over fourth environment property to year, being the So, quarters unfavorable CMP talk as us and even and a to Insurance, and that comments I'd contributor we we've made this to year say we've back broadly, when new at about both as prior to look meant of an of development got include second, results now year, something CMP the this yes. talk liability you the And Business back reserve alluding going about component. And it did has the disclosed component, I’d clearly, go being opposed a different. as But this the you remind we liability third, going liability as and if of is and to are throughout year, in even BI QX. you back QX CMP component to liability

Janney Larry is Montgomery. question next Greenberg with Your from

some price are moving you're today qualitative you're is quarter obviously, target just and this versus looking with Is with obviously with got to where third, looking that. how relationship that. moving? the and just Where question. loss pushing to I'm you feel and what you're issues sit that -- loss quarter, pricing a on asking third at Insurance, there -- thoughts for more is stood pushing you trend there shooting things back are all way any and all qualitative coming today I now guess -- is about say surrounding today to a you've or got the another the you’ve you trend the out from sit some seeing Business comfortable you where extent, Just of

Yes, It's Alan. Larry.

Let that. at me take a stab

an pleased would first trajectory in a And go thing definitely actions at to to would we're story. suggests that say here. I be have this think retention look good regard, got with rate we So, which the we that's that the you trend. and That pricing importantly, say, versus hanging is in continues there loss to environmental room

at of sense were the of In than terms a we're is, we're looking sure. talent and that's confident in the for in overall confident environment we out data the our of end we our are confident sheet, confident closer And We're confident year and our balance this analytics, in we’ve to there. what ago, this. understand we very are processes. We're that in the got we

Can This our I process it? people again that end on of imply analytics the So, best in very But we're the is confident lack in, data estimate. of we Of We it. course here. an is tell issue think don't nobody could. we not. environmental to confidence of couldn't you and this any and need top

as just follow-up. a then And

other to might those have this go You you Are that the environmental share levers at you in levers of addition willing to talk about pricing. issue? to other any

just just environmental, that's it issues. solve certainly you way rate, go because is those Well, as playbooks the you to the

always We're best that's improve. where business always performing and in to opportunities anytime have true there are anytime pulling a books worst to you this, business, optimize. And of businesses. circumstance performing book any understanding our apart frankly, businesses and looking Now, like our in we're in of

think at we we book there we do things. in the and the of environment this get right particular, do of them. either you that segments those accounts are environment overall sense. business look through and So our And the we'll to edges around When go are the don't business, process, better relative things there off current or or that can that will always we get make in rate we'll

so more strategies. I really a question to I'm to And asking you’re what are more is plaintiffs’ we. our more perspective. I or probably from sophisticated, say response that, then tactics bar And the doing anxious guess claim in not is, getting clearly, clever, aggressive. And would the detail to we're

we've us lawyers’ I very would litigation sophisticated strategy. unwise operation, probably a and for got think that. that to very do large be claim But

those levers so And will employ well. all as we

Your question JP is from next with Morgan. Jimmy Bhullar

couple had of a I questions.

most overall, more environment tort other vocal you've the on than been just companies. First,

aberration? you to for sustainable on environment XXXX? expense the being or it the quarter, worse your And gotten very it had then good to trying understand, of just stabilizing extent for as which the was is year. an what And Just is has is the other I sort went question versus ratio, through

And but than lines to thing various worse percentage we reserves long-term come very in one our years clearly of and know has start have environment say, you where got are setting there think to of the expectations. IBNR. losses is business, remember the I worse I the expense don't results environment year, about I'll we if the Dan our I'll you ratio. tort the then with is high ask in if for talk at would Clearly, a look throughout gotten

small paid of the a this. relatively cases So in are percentage

And has squaring in, And comes we to every we're triangles. say, expectations. will not We're gingerly. worse. in our what gotten responded quarter, the that's looking at have comparing quarter out, And data that quarter so I

yet this to than expectations. and a it's assertively in continued responded little have to worse bit our come We

five we what's expense again, before, and our We our to we as this ago. were But process. the this. quarters ratio? think causing of dynamics. analytics And And about year about a to I we than you want we the market said feel good closer the we understand think we are understand very Dan, talk end

Sure.

So, year, there's from a little to of going on full because variability the quarter-to-quarter. be bit focusing

we're So, was Certainly, than XX.X% last better the and noticeably, ago several with over range for steady progress now. three it year, a years that's comfortable full the years.

specific I think we're trying to not time. back to really There's talk everything comes about we returns the the is expense over ratio. which optimize targeted business consistently, way a

in pretty We've environment feels we've in this plus current we're balance this The at at for environment. make business to for year been able out that going And a think the that the the And same XX.X is fact will our or to it’s gains. that success productivity comfortable in good. the in and we're is we able minus those always we come Although the with comfortable that now level efficiency been we're level this time, make at to things. the with forward. level environment. And investments a that pretty get

price personal it cost can steadily than I actually mentioned if you that's like And this over past just years, slowed. to the margins I ask inflation. on be stable think more for we the of has look auto, one seems you couple And hikes But pace expect in XXXX. worse industry of if loss the

personal what gives get won't margins the you in XXXX? that So worse in auto confidence

loss piece couple this Jimmy, is the folks Sure, certainly I which well focuses of severity. say damage of terms dynamics rhetoric bodily are about is would Klein. puzzle. a a in industry One, talk on observing collision of about some the injury things. deterioration trend of most as severity you're and as Michael And severity, in seeing the we physical same that of

view better good the On mentioned, expectations And as see XXXX. change relatively on is news favorable a lower we but I frequency loss to XXXX. lower an frequency aggregate we And frequency. results renewal positive. going those with actually the And severity continued outlook as view And into front throughout continue than the term again sort and loss put premium again, trend been margin. then our of trend. And of longer together consistent has

last again, to underwriting, claim manage as drives for a use that outlook process, terms, much I the where commentary view we that think efficiencies, combined claim come Greg's rate trend including business, outlook And one ratio. levers well. the consistent. But broadly in that's into of you Insurance you is the Personal conditions, that on dynamic so to versus other land And your like

versus a it's loss roll to So just of forward rate not linear trend getting that answer. it

is next Mike Your Credit Suisse. from question with Zaremski

Thanks. the one get trend? in be employer -- Is pronounced, early how if geographies a Sticking there's could still more year-over-year frame inflation the the the any it this to could way or has probably maybe size? high I know tort we first. tort upwards in gotten past. don't I question is, environments number by historically And with innings of this

Yes, question, for Mike. thanks

the when year, forth. and way to one on at But last line year. the last of and is to look could say and of be look our I heat coverages, been business, take or we in And so you it's and So back a so right at of terms would we across quarter pocket look line. there step at geography broadly take a a or answer geographically, question and casualty think that may step any business the back

our than I or write majority fewer XXX would point out as million has $X of Greg mentioned, of that more vast or policies limit we less. a the have a of XX% business employees. And

is is to So, I about a relatively broad-based say this it. phenomenon think would way the

say had can two. about last I are decade just yes there's history, relative to and that facts people Now, know that them. different. don't compare or we you compare liability there to try over other out But some -- circumstances environmental I'll and the them, really

I’ll importantly, This inflation. environments by different all history us. inflation look been them, got of You’ve of one have But been recent business. of got have different We've data you analytics driven another And have the environment think -- liability social not available inflation. social medical by books is driven largely if I'm has prior most driver. at call in where aware distributed to those us companies that I and

a Slide so, last have the regarding catastrophe say you losses. that losses in decade my And deck than if basically about XQ less we’re expected. or U.S. to is the in the XX a Hurricane Would historical or last on on question over the differently, I get trying XQ maybe been thinking at, the am basis? cat this load look little should forward

it's that sure I how our make you're taken underwriting so decade seeing than this XX and is, move our to to not think XX quite the to I'm of to or more result over a here a Mike, answer years it And that for our -- of numbers. experience really of point trying is it’s What we're actions ago. that as the includes question. was previous mix than sure Dan. coastal book here the sort less

know don't hurricane. that there's ago, hurricanes feels than was around any commentary So broadly XX a now of industry years I anybody exposure or years there ago. been that years ago less lot there's five two to

in past hurricane what benign. hurricane that slide in And trying on been this write think is you, an are, think a opinion for mitigated we our the I is point a the like We're based of that's I result where aligned compared our traditional which a really the think issue, I as have risks. where risk the have, probably is has we we’ve I the just to percentage hurricane, exposures more on make book second relative really basis not is basis that. us over because telling macro this looks not and on risks environment with other the don't the we're on quarter to years. XX our our

that hurricane I since forward there's been activity. -- we're I'll like guess it basis been feels follow yes, a where have less on Okay, because not up still going there to

like for differently. XQ weight maybe being saying and I'll more it street a you I little insights. the has pronounced But they’re should we follow-up. the Thank definitely little think sounds it a

the going XXXX our we Mike, I'll and any scratch year, provided We at we bit to a like just models little heads slide. is look right. definitely XXXX we That's add. obviously or don't other what and why look know or

years. think idea for point relevant come it's plans XX years where could about is no starting what thinking -- this assumptions certainly are, have our and But last we and think We volatility and we the what about when our year the how are future from. our

Meyer is next Your with KBW. from Shields question

question Greg. a is this think I for

on market, is middle or just delta smallest rate change Within there it’s fluctuation? been the going with is that was premium exposure units and BI the renewal time. segment something quarterly between noting there in worth the renewal Is some that

Meyer. Hey, that's quarterly This fluctuation. is Yes, just Greg.

on it's last down lot exposure the and and little the to that activity, You of a accounts is latter. more do over the see bit can or two we trying a broad individual unpacking understand economic that, we quarters, think

with linear exposure XXXX, it's back in compare what seeing of you the this on we're half economic to change. the year If the activity

Michael, talked the is or assuming a weather. about to you regression personal normalized then ratio, for or I combined reflecting improving actions or just a And really return non-cat to changes? of a to that mean that for want quickly, reflection say Is underwriting lines the claims

things. what question. sorry saw normalized say appreciate mean than expectation been that to has about Sure, in One, is XXXX, we XXXX. expectation lower do in weather we -- two I'm that been non-cat what the been And I XXXX a we've reversion means XXXX. elevated was about and more we've it Meyer, as the a weather doesn't lower non-cat reflects talking say talking mean, it would I for

expectation rising. updated reflect have XXXX That's updated than importantly, to an of the activity level, in but view continues has lower which been weather estimates We non-cat XXXX. and an loss

or it you So the four assumption have would includes want more years in assume two the is same outlook wouldn't two that ago. or three it or that or we And I than three fact, to loss assumption content years had in ago. four

loss the content improving a we outlook of margin non-cat in the view And year have than two so have margins that higher we despite we Homeowners years would a ago. see that or ago segment Agency and in and Other fact had the in weather

Brian Your next with UBS. is question from Meredith

a questions for Yes, couple here you.

seen respect some First limitations? open curious, one, or states the kind any other statutes we've given statute to update reviver with expand of

Hey, Brian. Yes. Dan. It's

activity active of been big this modest related legal big obviously California enact is one very a a again, quarter, well. it's Carolina revivers, -- of our reviver, I a PYD not the to a big enough we lot have North saw number and amount in called in quarter gets So think but state that as environment. to a attention, reserve out California

or before you to don't But remember, open had once case California in reviver. remember,

there. our consideration And goes into so that

been has throughout there year. steadily activity So, pretty the

did that again notable in us following most but the and that talked fourth the it was about occur activity quarter for there's modest then, and First quarter. been we

some expectations mean is that then obviously environments on seen low given that kind continue XXXX, expect and there pickup a I your we're is in And noted that you into loss of the have Would unemployment Great. of comp. cost question we’ve to going seeing. reductions the medical second really quickly workers’ that Although inflation? offsetting cost noted environment? rate the just you've favorable others

Is your comp? to we workers’ in whether continue expect question PYD

just just environment we're no, not trends with as as the very is favorable PYD trends average? comps of seeing to compensation, much kind severity, frequency but loss of so which No, respect kind well trend at no, I workers’ and guess

assume been have favorable. to trends a there. We The reversion a generally mean longer term

long-term So there we has mean improvement I will in continue. don't all the been a very assume that overall comp favorability workers’ frequency.

than been to taken think don't account, assume similarly, And necessarily pretty has been inflation So severity benign we’ve And that certainly into that's better even have side we that. well. results revert. Medical going the but to we these tend as continue. things

The next Tunis question Research. is with Autonomous from Ryan

commentary to Alan the is close to end one on we're back and going this just thinking beginning. than guess for the the I

to XQ. past in tweaks maybe of few sense bigger This had the charge you charges same made, that some we've when the one or quarters. you took these this one Starting IBNR third in these Is that? with than in saw we have where So you does that give relative more how is comfort? that confidence you the in past? are been now than at we gives saying more Like the quarter in there

on view is. Well, get a get where to -- it's every a data time you environment little bit you quarter little better It's another point. another more data, bit the

third and And or tell perspective, we first, it year better. I so, coming in. where can't from of at second look quarters next is that the you feel

in But frankly, into perspective, So we're other to continues quarters from be there it. uncertainty. five And it. we're into quarter some that

don't developed quarter, that over a going more environment quarters, first a book bit know the I our yet, so gives more hypotheses. And just We into quarter. happen don't the confidence. Ryan. all and view what's we bit little to little every us -- in not our comment -- of And test can't the five I view we've dig about I'm our

think of execution still of to would you environment? achieve have guess you Business outlook other you result be you were when about So for you -- in fronts? your or something do that think with Or that, tort to improving Insurance you pricing do XXXX margins, I do hopefully more think the still a think or terms if on it's would --

things right. uncertainty loss to this view as and got -- a risk is our be feel number of of contributor. a based to I social We of things confidence a some and on any mean, price objective reserve I always our obviously, one factor those those We But be said, We us. processes. we've could any for be -- costs. in get continues inflation Certainly contributor. could

right. And try so, to to us important to it it's get

so done that. And think we've we

from Sandler. Your is next question Newsome Paul Piper with

is are commission rates. I data passenger with for some want changing paid its anecdotal pretty Travelers being private there's anything rates? high it's personal to line others and ask changing auto Is doing workers’ lines, seen Allstate We've -- commissions. commission personal that as comp. about broadly commissions too

Yes, I would say broadly our commission rates are stable. reasonably

So, no.

more Do your to that, issues in view, really have feasible And on then the of rate. an outside or industry the involvement? you on limits, the of the legal Because to is -- be -- back for the material on limits this with it of lower there's more basis higher fixes thing. possible the the one ability and wise

lines in I in policies liability comment or ex-workers’ and prepared comp of million in mean so I referenced $X Yes, just limited XX% go back his or me policy made let a just and our Greg remarks have less. highlight

industry observers -- I smaller that's think the There's accounts. on true. commented that the a on loss activity environment limits have and there's don't profile. this We So lot don't the of just between think been relationship it's of plenty

-- businesses customers there are got level right just the We help their risk haven't their changing to them their out profile. protection and limits our We move necessarily to businesses. charge think seen of manage to price industry manage the We need to they intend and we a certain it. we haven't and in the for

limits answer. broadly solving profiles is this changing so, probably through And not the

Amit next question Buckingham Research. from is Your Kumar with

Two questions. follow-up

road outlook the XXXX to time CVA because the we CVA. from potential closing? reviver of some action first any will of by windows on Insurance Brian's get contemplate down back Does The the those question to your goes half question back Business start

when So estimate Amit, of our the XXXX of and is the us costs for and Dan. are is period look which crystallized that close, the haven't to which We that have it's windows we've types aware in change a the through to we'll best of CVA. more periods of were have view volume open that time reviver activity in makes activity the claims will open. they do view the that's seen of have reserves to coming actually of point, that the of the related loss To in. Obviously, What close. come revivers been we enacted anything our the related in ultimate this tried regardless

we this combined regarding to general, the information today. the underlying we have all We Regarding one, outlook as speaking, ratio, either I'd environment, think in is claim relates that but -- XXXX development anticipate prior the commentary or reserve comment go favorable on we’ve view generally our the make a our and year forward said don't reflected it today, in reserves unfavorable basis. our consistently, exists

want the to But question But GL towards CMP to account. other question go I the I it. discussion fair is should the about on it moved market broader small the CMP. tort have national say accounts. middle curious, to sort of only to select product and is initial customer on and would I'm larger or started that -- accounts back product we then back going mid-sized on is towards The the think to related the adjustments the have be how from to environment, to just that? Got

looking XX% I less, It think not. definitely in policy on or limits I'm our really $X million commercial auto policies of No, have commercial -- auto started and think. of I

actually. million X

X million.

large and the end this something started end? started This that's on So isn't the down. small and down moved that is spread something small

directionality That's heading and understand we’ve climate, the because was to continued down want I and just I heard into question. the down claims. smallest that involvement larger with where versus that the down the has to claims, tort the consistently attorney move of

that have or employees it's $X we writer. that's policies limits commercial profile a we that majority and talked our about a a fewer. customers, We've gave vast feeling million those heat -- again, of middle lines Yes, small and fact our the mainstream XXX of have the business. and got of we commercial I market policies you why are are a mean, And less. in or limits

times a GL, accounts, largely observe Those attorney spread What commercial again, sense attorneys not auto. are bring. to a did this Now, in Those national on we're always because hard us, a Those limits. was have the to easy into big we But of to on accounts these for across there small and degree did had started made larger large size. that very -- lot year on ago them. those that the it limit large spreading the perfect seeing caps. aggressive claims. is to participation now have to homogeneity claims in And

David comes Motemaden question final Your with Evercore from ISI.

how to five forward? last expectations here charges guess going seeing of quarter, Just in how quarter? losses get the this to deviation trying above narrowed terms past a come environment the compared to last are for a quarter? and the it the experience just did trying Alan a expectations, sense compared I'm question tort that for to over more smaller sense Was --where a I far for get on we BI. Has versus loss of amount in in Just quarters?

taking the think I use I'm sort is say, basis, to view Probably question consistent really about and somewhat way a your the insight. about think about Slide which to XX quarter-by-quarter said. really is year any it. don't full the what a the right maybe think But it the I answer of I to you on don't I’d that is way right to year, than back know step trying think

looked and been. if or to bad quarter. news It's think full it noticeably the in back about third we thing tort year it We’d saw the is we drove what have, say quarter. And related step at magnitude. I worse in the of in basis on and a things different terms underlying weren't you to probably news if you changes. that development. to specific of news within hard data the basis. points combined being second higher there's about place in felt the was. worth year full bad the when inflation, they And But saw to think on than loss think impact had magnitude year But also that same year of broad this take science. as about We reserve the not year news to compared probably and environment bad you the very we’d PYD We a fact we we about fourth to the the terms the in social way an be, in can based full the this points ratio overall than prior bad there full over attribute characterize analytics that exactly a attribute year's has ago in they quarter. full those been saw best X They

it. Got

just on just Okay. wondering, it and mentioned, seeing And versus to XX%? I higher increase just Just that, you smaller picks? sizes. that like I'm -- sense are are your on to that you you Like that now cases how where continues XX% a trying you in are is loss for smaller just had increased? much get has Alan, guess case involvement, I the attorney guess assuming

coming percentage seven lawyers years six years to seeing don't about increase in that you sure we're -- half the that over will which XX has over so, but increased with claims absolute I -- I'm points XXXX share about I of number the on not Yes, of we're XXXX. by with share and going

that years of recent of how really much the sense in the over you of quantum increase. half gives of the a and and has So 'XX come that of sort increase just 'XX,

such just the shift. that's think is why recent the we to autos it's me, of business. been a commercial pointing to And One reasons and -- yes significant Abbe out

you are there time, further closing this questions. no any have remarks? Do At

much for free to a good feel Relations. always, joining Have reach day. very you please as to any Investor have Thank follow-up, out And you if us.

Ladies and gentlemen, you today's Thank for this concludes participating. conference call.

may You now disconnect.