The Hanover Insurance Group, Inc. (THG) 28 Jul 212021 Q2 Earnings call transcript

Good day and welcome to The Hanover Insurance Group’s Second Quarter Earnings Conference Call. My name Gary and I will be your operator for today’s call. At this time, all participants are in a listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded. to conference like Lukasheva. to now would turn over the Oksana I go Please ahead.

Good you and for you, morning Thank operator. thank conference our call. for quarterly us joining

our prepared We of Farber, Jeff Specialty Salvatore, Lavey, our Financial answer Dick from call prepared begin to Chief Chief President with Lines; Available Markets. questions will Jack Officer; and today's our Roche, of President your President Officer. and remarks and Executive Bryan remarks Agency after are

Jack, let complete Before note the today's session. I at over to the we financial Investors a turn earnings www.hanover.com. our and call the presentation, Q&A release, website will slide me press of in call that for our answer section After the are questions supplement available presentation in

of discussion to I among today, will of questions and release, certain pandemic, forward-looking the as financial respect, or outlook remarks are other things, Our the these reconciliation the Private you on to other supplement, slide statements results the and earlier. to actual release, deck comments, defined income basis the with statements responses uncertainties will performance regarding, catastrophes, and prepared fact, ratios, loss among reference presentation website, and historical for can of closest Litigation and the historical presentation under and turn SEC. XXXX on press other statements Securities of the GAAP as ongoing also over COVID-XX the from forward-looking Company’s in impacts measures include be the XXXX, the financial and Jack. mentioned call those combined others. our the and our found guidance posted With which reliance in Act risks Today's I our that to section measure press than financial cause filings affect as differ to a on year anticipated. respect in Reform could measures our non-GAAP non-GAAP accident We operating such and/or A with materially those refer caution you statements this to conditions excluding the forward-looking economic your

you, the during the our by segments Good our Jeff context quarter Bryan, second financial current I and Jeff detail our highlights Dick, in then and us. a for take your And be of economic of thank you provide Thank joining of begin discussing review to I more Oksana. environment. will and everyone, the and financial strategic each I'll then on results happy business review morning, will quarters quarter. provide questions. some in ahead. thoughts will the

returns highlighted combined across We premium or equity report $X.XX outstanding per strong by on pleased XXXX results quarter excluding increases a XX.X% net to or and the income XX.X% Operating $XXX basis all impact are share. XX.X%. of written by of X.X% segments. Operating on with second premium of adjusted an return very growth gains ratio of of driven million

this dynamic are opportunities to the of takeaways my two key environment. results. navigating of underwriting on capitalize strong ability a evolving underwriting the are market results Our quarter From while there reflection perspective, complexities second our for

meaningful in turn. strong to increases pre-COVID-XX would of the in in respect With like First, step we I broad delivered premium each businesses. growth, all results has segments each year. second, continue discuss in briefly our and of underlying our a of to first profitability And levels this each accelerated segments. based growth achieve of in with compared our business to exceeded up to quarter we these points underwriting

growth platform. partners strong consistent relationships provide metrics. technology result forward of on business our solid growth and with state pre-COVID-XX as leverage production market potential profitable and our disciplined segments Strong of -of-the-art our pricing sectors strategy, major our for new levels our we All going now retention agent a and exceeding robust an are most capitalize opportunity as

the Additionally, our never period. driving more returns enhance profitably. monitoring we year premium or of the within and XX.X% we ability excluding and tools. analytics, continue our pattern in including been delivered to of effect sophistication inflation to confident Personal in data the level I've our grow growth X%, In real in Lines, time of claims prior quarter the

from account of businesses offerings, continued agent driven Our this in in our XX.X%, our our to to the positioned remainder to growth deliver a strong as continue grew single-digit reflection which benefited growth competitive beginning and Overall, specialty interest actions, of marketplace. platform market and expect mid-to-high of is impact successfully a strength ability our we as customer our of position our the recovery quote Sales. the of see performance lines the and commercial for by well of sustained we small navigate commercial growth the issue has our We targeted and strong business, business new economic all momentum the pricing to are Tap segments, adapt now roll-out and year. portfolio, in the well attractive driving by

has we experiencing more arrangements. in working auto loss opportunity lower trends, remaining still the are quarter meaningful to that of reflecting utilize customer base fact frequency our loss some portion the a flexible likely the Regarding

the our hours data consequences potentially many and congested less indicates as reduced rush areas of country, in Additionally, pandemic. of lingering the traffic

expect persistent a activity severe fatalities. we elevated overall property the we quarters. for are recurring on We've the prudent loss is is including in large selections. in accidents our do will been We be watching profitability customer additional that believe rate of strong And we delivered severity believe moving given it and offset increases We from its several which other in the that will trend. frequency geographies, commercial, mix lines commercial believe benefit the although Thus, which frequency necessarily experienced there as or partially course property near-term new for this the very some certain elevated indicative of lower quarter may We not and accident room we loss profile. market. our in lines losses, property with some reach of remain provide always, over XXXX, think ahead. increased consistent by normal We inflation materials including more

We and are other potential treatment delays the mindful social medical increased inflation, trends. and about information inflationary for

We are as many the watching of economic recovery as full in catch and well acceleration the up system the and business jurisdictions. closely activity reopening the court of

to to duration impact personal that exposure. business as be as by on the some highlights recent is well With and comparatively we to lines. that While like our beginning I would reserve determined, duration potential of short book-of-business background, are believe with manage through yet inflation positions share now

auto to efforts very X.X% growth demonstrated by were successful, adjustments our apply selectively Our rate warranted during PIF X.X% been in sequential of the quarter. home in and have as

growth business ahead of in came expectations retention. sequential improvement New and in are we seeing significant

represents focus decisions. particularly agents advantages customer book, preferred to strategic approach as carrier our of our leading Account over of operating become more XX% business level a significant Lines and with competitive Our stability. business their and Personal represents placement overall and value-based even models retention high

indications success the to Auto, gradually environment competitive, dynamic agility remains points over of levels of retention the Though has the quarter This our and of industry we strategy expect Our Personal very the in our personalized our progresses. clear to environment. this pricing given the compared rate normal pricing and to bottomed by the second improved the nature in as new cycle. quarter that to be the seeing business is increase approach even are expected year looking rates. deceleration first auto out is In the frequency we X demonstrating Personal the approach Lines claims

last pricing pandemic. historically Auto As strategy positioned throughout the given We rather rates Personal are prudent trends favorably believe adjust more quickly. future our the for to we

a need disruption near to have a much create less we As increase and rates significantly result, in future. of customer

offering positions moment autos homes is We business our second this customers Hanover and to insurance continue represent The Lines segment further more new gain quarter Personal growing with account strategic by a contribution every to overall customers of higher quarter, the us for Prestige, the value These with agents. with as and growth needs. with which points. growth benefiting complex a increasing partner of X offering our market, full

business of growth. in well commercial our in the Strong growth continue XX% by driven the is core to core a continued specialty expected Lines, our of a driven in successful and top in the we of rate Commercial increases extremely new commercial economy, business, posting on pickup increases exposure rate to line TAP Turning strategic Sales. year by through priorities XX% executed growth reopening and and launch

XX states. business proving an countrywide this states addition a by commercial be we commercial already for the new the nine complete second platform, our to advantage first small in year-end. In Our product total strong which to owners the bringing to quoting our additional small quarter, we launched is offering. platform implementation And great

comprehensive TAP marketplace. improved. and new an a self agents in are strategic capabilities of increased As realized The commercial new offering efficiency of a praising system our Sales enhance more positive of capabilities gains this forcing whom process that The new substantial, quarter policy the the use have those we more and single reminder, to to been for issuance to and ratio In the new states, The infrastructure do a of hit our and and business location has calling this at products multiyear and new significant and books-of-business. across buying a administration was when this are our business. ease investments delivers service XX% and it deployed them being a to response quoting carriers capabilities. states of with first year, they also agents set is This time the best-in-market. are sophisticated It simplified made agents, new the risk front algorithms, quoting endorsements, a our user become end pricing includes substantial agencies investment have it were with about significantly consolidating the our submission before. products small required time modernize enabling incredibly

product to to our for Our agents and breath our use them. proposition increasing increased and focus, easy account driving efficiencies are tools value

growth that will us further provide confident significant in we delivered the opportunities We are offering also ahead. penetration quarters growth. our for agency Specialty, and In robust

lines, growth and profitable most management During which the are businesses. quarter, our among our we marine, achieved double-digit in liability E&S

And we products our specialty strategy, leverage base. capabilities continue total advanced and our to financial We deepening also use our lines as and Hanover institutions spaces of well. commercial the capabilities retail across our E&S customer in expanded the

our to customers, that we to offer to for growth specialized us continue more are continue forward. agents As confident Specialty business going will products critical generate

the at commercial with and environment and sustained increases rate XX.X%. our rate dynamics in retention achieved are X.X% We of the We commercial in pleased markets. core exposure strong

on social strength costs and up price rate upper in in auto levels general, loss in across believe and reinsurance Exposure loss our us implement environment There markets pricing We and rate during X.X% brokered of granular momentum increase the materials achieved price items. interest and drivers meaningful strong continued increases the first the sets from the from increased pressures historical pricing will retention increases going large with been growth. risk outpace accounts can costs, stage But double-digit accounts. pricing to be rates of other type. focus commercial significant by growth result which strong the in exceeded shield in specialty an to prospects We property for continued a positive fluctuate can property profitable and we In potential and as to that our the in rates. including quarter. increases and in overall, growth sized commercial of a In for our differentiated from low in quarter of Specialty renewals very exceptional occur bodes our larger offerings and summary, trends. lines, the continuing the quarter-to-quarter support We growth costs in delivered which the with single-digits smaller from established unique reflects quarter, segmentation we forward. meaningful account rate Specialty business differentiation continue has well have deceleration X.X% help to inflation,

We environment, and strategies, approach centric leveraging and distribution agency exceedingly broad in an uncertain customer capability, distinctive well our are performing underwriting and and unique to offerings. product specialized disciplined pricing

on we year, confident As our the our for and year-to-date growth performance capitalize advance our opportunities to strategy encouraged ability and forward. going we begin profitable of by the second half in are

of call turn to update our our like over Jeff, Before our to the I'd on workplace. the I future you efforts and to business reimagine

service and As are we us. levels over provide the times, even I on proud of of extraordinarily have the depend of public enhancing has health promises, who we maintaining said our the work our on many done to crisis, course delivering this team those

growth. our to deliver profitable As we continue to company our sustained, positioning drive forward, business

being a insurance are company, ordeal citizen. emerge from this corporate employer and determined opportunistic, to and very as We thoughtful better

and intent as We are and for has closely trends that employment on retain been the as us outstanding well competitive a to monitoring important attract strengthening us talent. rapidly an practices changing culture employee advantage, preferences, enabling

employees sometime to to largely during We invite basis have offices and a back on to begun expect our fully reopen fall. voluntary the work

environment so. public to health do the conducive is Assuming

engaging that, times up that build for I exciting to We are those can the over turn expect embrace model, are call environment one work provide us truly customers planning flexible, and employees rewarding will the they products where With These challenge. Jeff. careers. are our to and services for hybrid to a provide progressive agents enable that deserve a and they and will to the

Jack. Good everyone. you, Thank morning,

net For share income quarter. quarter million fixed million portfolio. of year lesser with earnings million we diluted is $X.XX unrealized net the difference and by reported of was fair compared the per the per per an or income or share the and due equity quarter, with quarter or net prior operating the driven income increased to between $XXX.X After-tax share per securities, Book $X.XX The second share value of $XX.X income $XXX in in extent our increase compared in of $XXX.X a to share the XXXX. X.X% income increase gains in operating in value or $X.XX per second million in $X.XX diluted

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a net we large unrest. social incurred $XX.X Midwest overall our losses points of the the ago year in the rain million with quarter, events of reflected ratio including throughout or quarter premium pleased XX.X% above second are We losses reflecting combined the earned XX.X% expectation, quarter compared of XXXX XX our several and basis in XXXX, in to second hail of catastrophe torrential prior year from which X.X% primarily catastrophe quarterly events June. severe wind, In

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losses. we events weather as adverse do see expected, when However, occur

experienced development, bottom prudent reflecting from Prior $XX.X years, favorable our reserving quarter quarter, was approach. favorability Personal the Specialty excluding catastrophe compensation, also in some favorable prior year a line is testament adding which and workers the continued reserve to in Auto lines. We several to million development the catastrophes primarily in

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with In loss to business Specialty favorability quarter our generally by fact, expectations. this amounts the particular loss overall line offset the within was bring our overall in in

long-term combined in Specialty ratio sub the XXs. Industrial Our at runs business a

confident in in strong business. and are We this future our underwriting performance capabilities

loss current excluding remains the results. Our quarter’s with consistent Auto recent your accident catastrophes relatively Commercial ratio,

multiyear liability wide line. We issues are address continuing increases to to rate affecting take industry the this substantial

comp, line with historical recent loss current which in was your generally Turning XX.X%, ratio results. to accident workers was

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this in remain trends favorable. largely line underlying the While

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excluding Our Personal ratio from loss quarter. was in Auto year but XX.X% Lines the trends current below first up historical slightly catastrophes accident XX%

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strong in full Personal and have confidence growth profitability We prospects. Lines

investment $X.X performance, up partnership due income This $X was in to the year our the quarter million the in our Moving million. by quarter a from for unusual on income income loss largely from fluctuation exceeding to Net adversely million prior XXXX $XX million investment investment while partnership XXXX million period-to-period. the income partnerships, of is $XX.X was or net was second $XX.X quarter an second affected limited XX% by period. expectations of in

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XXXX have average maturity high fixed weighted quality with end second a portfolio million the We before the A gains taxes. of Net the quarter of a unrealized portfolio plus. at $XXX.X on were

to and on Moving our equity position. capital

reflects of increase share $XX.XX of quarter. per the value X.X% book Our an in

of we We continue in repurchase capital strategy. about million stock XX capacity our on Through stewards capital $XXX thoughtful shareholders approximately expanded allocation repurchased our May. XXXX, board under our deliver to authorization of July that leaving and be million the XX, stock, of

quarter we million. the a regular $XX In cash of dividend approximately addition during paid

priorities capital unchanged. Our remain

strive capitalization strong we our to First, liquidity. and maintain

Second, and third, which to through continue repurchases. cash maintain growth to generate our capital capital. dividends of to share we we And organic continue policy returning prioritize of excess we plenty for shareholders

nimble actively the interest remain of best with and We to manage our capital in continue will mind. shareholders

from for is net improving we the upper are strong ratio outlook of to performance the mid-single-digit Looking single-digits year on expect of growth believe second half year. the the premium mid-to-high half our in in now year, quarters our to XX% results we XX%. written two ex-cat in of XX% the With combined full Based ahead, growth full ex-cat first XX% ratio X,XXX the year expected than possible. better to we combined

earlier, load third XXXX And to our basis we to X.X%. cat reduce quarter by XX track least we expense be in on at our expect ratio XX.X%. noted remain to As points

positive momentum pleased continue with very in are We to the underlying performance our our ability and quarter. our

value and growth well profitability sustain to customers delivering We momentum agents, shareholders. top and quartile our positioned robust are a to

September pleased differentiated range in we will addition, of hosting go Day strategy a announce XX, long and aspects targets. discuss will we the that on be Investor our drivers, we growth are financial Virtual key which In to forward

be for providing will we details questions. weeks you look forward in With Operator? the now will the seeing open that We there. and additional coming to line

Instructions] now will momentarily this assemble will [Operator question we the time, session. pause At roster. to We begin our and answer

The first question is JMP. go Matt from Please with Carletti ahead.

Hi, thanks. morning. Good

Good morning.

those existing extent big consolidate coming the of to relationships and talked about they buy I cross-sell, opportunity product that Jack have the a the lines of and relationship growth Bryan the is I type in that Is what you that on relationship. are past to Specialty that Specialty. kind where you a you'd comments yet somewhere Or of or on was of something as the bit. a piece And the could your caught growth? areas from. little it come? growth of expand some within of or And that hoping specifically, of with kind I more at is, Hanover one To else, look client some question is

thanks, for overall the growth. one. Matt, update on. excited Yes, to with start question. Specialty it's I'll a you we're good One And

are that well bottom line at a of his where terms And in to is presenting best. each team opportunities broad the marketplace. allowing of direct really I in and of I Specialty think is the businesses performance Bryan business think themselves based that's of result how that its profitability within is these that into the the lean the the

the very double-digit prepared there's It's several we upper individual Specific of others by generating still our lines that as business. are are point and in kind well the there's business driven around your growth very businesses said growth growth. businesses versus that our to cross-sell single-digit So much positioned. of remarks, all are of much businesses individual in

service Although And what mobilized we bring for consider agent space, all service the total that or the to only in lines can that sale particularly together centers, the to be cross-sell that of in the around an we've business are accounts. small commercial into definitely increase accounts. think the on we're our an coordinated smaller where I seeing center way we would

specialized two now from agents. more coordinated are cross-sell or the of to from maybe majority just Specialty come what as pieces much agents that and our So will products But franchise want we some coming increasingly, Bryan, of more specialized that growth well from color Very business. specialized or our into do I think is add anticipating you right see of you one there? kind is agents. of as

Yes, sure.

thanks a the question, Matt, much years, view I What add towards really of across that process, what Hanover. been And local that that what to a total the couple is for for yes, refer agree we So, very with sort I as our strategy with working we Jack level we've as of is last agents consistent the at where said. would really connect businesses.

business, we that seeing our grow across our And of working closely so ability way. are a just Jacks said and place of benefit coordinated that in process some coordinated is point on it, we're from driven, of lines in in very a the good very way to

with generation agents [indiscernible]. as from yields our that that relationships production so of well. is And piece a our And better core great cross-sell commercial that have

lift a that. including getting of from we're number things So a

the might impact obviously, for is business to kind should what the just where first other how last and of somewhat of or been good stable ask hopefully half all from little of the year, And can a little you your this kind in you much onion a hitting from Great, loss costs of favorability could be accident, if there, continued and if a picks I hoping kind bit. cautious pick you back been help The if just Jeff, versus you've long any run. maybe your a frequency comments about then it's time, the thanks. there us I'm act said, made understand, you very what, rate And of like one question, cautious a of just favorability said the and of bit. and that into can that on peel is gears everything with settling for a line shifting I line you Commercial norm heard few reserving new of pandemic, Auto just

right. going at now anyone opportunity as been yet, XXXX, Commercial it's with the particular hard all benefit, And it's rates. years to quite we've of continuing some for XXXX focused be And two that now Auto Personal with prudent provided on very, and frequency much for the we're comfortable been seen we've three it an year. to period. Matt, and say a in Auto, not first in it for as quarters, the we've think very right, there industry in throughout then when least nearly terms getting double-digit after decade been in I waning because

in notice that You I development lines. unfavorable line. And we particular about point show seven out, different would the

some related to occasionally, good particularly So just the to It appropriate you'll years. all not the related And that. loss sure unfavorable that have nothing one XX a picks showed year want to do it that see was and clearly make there with earlier and to we was conservative we're opportunity was and was for it itself. years the development. But

much. very you thank Great,

you, Matt. Thank

The Derek next is Han from ahead. KBW. with go question Please

Thanks. morning. Good

The of I accelerated is asking you second due increases Just because to reason growth partly just which single-digit saw non-renewals? mid-to-high retention your half. commercial much going growth back I'm that how guide talk rate while to exposure the is is the versus I that rates? Can about for drops, sequentially assume why

it quarter year, bit where moratoriums about to is had and will back consistent little We're assumption sequentially. lot increase the to was it aided, the quarter and be see really in a had can slightly XX%. wind the a rate with that overall, So obviously, but were some remark unable a our you down retention even come we'd a from And second in that last to I bit bounce be looks has seeing over that of first like it unusual other XX% speak the so is was or things. like agents you exposures it and flat, know relatively relatively it you up. so

better at the for the look I months think six for retention if a you'll year, of see you the barometer first that.

and rate good fair factors on think I a bounce be It'll new business, exposures. continuing back So retention, all contribute. of will bit strong

large describe Okay, Can question, that's then numbers And commercial helpful. that in saw question. you segment? size the the the losses you a just property of second

not there were been meaningfully Industrial. if a largely premium. businesses fires. we the But as and fortunately, period which were there reinstatement even Specialty that performance but and showed did look along large the it's number Marine such loss. earlier larger in across We loss the reinsurance our quarters for one they a across was commercial lines, were have Specialty terribly importantly, core other areas, dealt losses, offset commercial other few continuation Hanover Specialty other a So essentially Industrial, is we business, you And property with And which there that which losses commercial of in Hanover essentially in mention commercial, themselves extra segment. segment,

call would it to of really fire losses was elevated it. I So that that seemed just a couple and be

you the property saw helpful. large And second the a losses that's the in size you that of then segment? just Okay, numbers Can a describe Commercial question, question.

exactly Specialty say certainly less going extra. than lots to because just than always Industrial, at the to a you expect, goes, routine there's handful they losses Hanover couple of look on, do losses, Delta weren't things of type outsized particularly but a then hard could if It's meaningful other the they weren't you and what

you Got answers. the for you. Thank all

Thank you.

Thank you.

Piper Paul The Sandler. next question go Newsome with Please ahead. is from

particular quarter. but ratio half on for that think morning, would math is higher was guide at for bit Is the my of maybe core it kind core a you issue. more the half. the combined weather of your second to think quarter, actually reason that? first talk looking is I seasonality could second than apologies the would not being suggest a in that if But congratulations I of little be and your there best, the heavy Good any

I underneath there's that's for see benefit. Yes, that to you reinstatement and case, commercial to of the larger then disappeared. activity it commercial Commercial well as will that And as in the core be up remaining loss large expect frequency some in one some as to a we second If believe increase. don't the to would in the lower. get have little abated premium at bit. going time, half, that. nothing Auto degree that Paul, go I a cause I look Specialty bit the both or the Over to I ratio were core on loss

and So we're I that check go maybe have being conservative. back to would

hoping you the sort [indiscernible]. question, be commercial of further I wouldn't of comp. how thoughts workers' my It was on I your time And the excluding about sort trend first get second to folks think for underlying inflationary

looking two like And in X.X% of Chubb great concern I mean, Chubb was is X.X% point morning, but expansion are one number the for talking the a before. essentially that think that increases, talking levels are I if commercial is inflation. uptick given or companies then than about of is -- day inflationary was margin that the price about this the smaller it

to could of those sort just kind maybe So talk of concerns. you broadly

Hey, that Paul, jump I'll question. Thanks Jeff want or and if this in. Jack. started for to is others get

aspects how we just think in I of fair level confidence accordingly. the have react of our terms the complexion fact that monitor that hits in with start the of ability of and it I net-net various would to inflation our a business inflation and

as prepared we makes casualty reserve inflation. as write said. on make -- some clearly position our have even longer -- more from large or it impactful short said in or limit comparatively reserves you go than that lines, impact remarks, but doesn't But muted the others risk affects overall, profile our us particularly business. forward to their certainly degree picks, that only casualty their competitive less our tail the very duration, business not Our and immune

get basis -- but some the So wages and receipts by also collect premiums. natural to exposure including which we there's and offsets,

addition And some should that out. to that you to side, investment elevate. to then the time, will exposure help have sold, adjusting will cost which if we the our uptick reflect improve environment rates our on but the income, increased of net naturally basis, So will, let rate Commercial have we Line in through interest play goods obviously, over

casualty this for property an important is So, business. listen, topic

any for great positioned day. on. of got got relative think we've right our the on the basis, we to But well monitoring question And it's [indiscernible]. inflationary I feel So on a us, you going with we've deal should the dials, fingers that know

in to Okay. can. more, I'd like one if I squeeze

mix any there versus industry the what national writers. And private the But maybe just breaking of has that in basically for versus maybe with much rest rule. up is the ended that So frequency we've seen. of the company a you differences that my seen so is there passenger meaningful difference regional being can your question pandemic talk or maybe of a benefits two you between auto business if I'm a to now year

or to Paul, glad We're to And last third I Personal eight a build take that in strategy important hard really one think worked it's question, Lines. an the differentiated really because nine years we've for us. over

was and be was the limits We win us. carrier have that often trying we that losing migrated monoline auto low from strategy to multivariate through a next auto, realized trying for to a pricing,

think entire last delivery dividends. models So We to to writer quarters. to and advice. is system. with the -- our up curve A kind paying proven our huge And would in We the over be for be agents we has our account we're that over of several repositioned coverage pricing pricing the the really strategy move there customer time trusted our out an persistency think really value with this

that trends geographies at have more our the was the have frankly, of didn't with of because was. we be we to and pricing year, and end think last are as were But how loss were able competitive it I the responsive I we play it in. think stable, about talking that we customer and our the people to just and base frequency show

proud kind So where are that because in let and little there I strategy, this a me important of think ask is add we our to really of part darn just of Dick color evolution. a we're pretty

And your specific the trends we're Yes, and on mix geographic sustained Paul. there we question, the But profile. benefit to watching closely, having a frequency advantages to think really absolutely. customer do Yes. these based profile are

Connecticut, If New than economies of states. the have Northern southern you book oriented come back Illinois, more being about those Hemisphere slowly Mass, York, kind our Michigan, think

So some we persistency frequency see and there.

higher over away as have then mix, multicar, These skew Of type folks We But liability Jack pattern. the we you said. likely skew that limits. course, a time. likely work-from-home goes skew older, sustained longer have we customer

we is community so us. And patterns longer-term for differently. that And will think a benefit that the likely look

Appreciate it. Thanks.

Thanks, Paul.

Grace ahead. question America. next The from with Please Carter go of Bank is

all how today? Hi, you are

Excellent.

morning. Good

the workers little more of was couple quarters. was bit wondering The core past if comp. talk we I loss could about ratio than a little higher a bit

you reopening where wondering just and was progresses, progressing as here costs I and costs pricing? see loss also from loss going So how are

experienced ways and thing our losses of more was work that move really for a my as in more Thanks we about colleagues flatten I'll up I'm flatten challenge relatively seeing as and and Overall, move get would Grace. started sure to that's way. back than percentage change much us it in. of than types start system, But jump say I expected in our and our off portfolio. frequency Jack that definitely is this being Yes, which that We that levels will also through seeing in was we're normal an are certainly still to and some last think given and this automation the pricing we is of -- question. the a we the you we've and been management change If we think, and will seven of worked see that six types the we through last more pricing. saw workers of had and kind of kind the -- or moving this how this loss at meaningful What time is will in in a on terms losses. What's think risk comp a you low applied. positive of total I still opportunity the years on of change is black I new the costs, back

space. little as start severely. also and more it'll line, trends market those look comp centric particularly we we that we if can very pricing line that workers account which different profitable come pricing the So more advantage middle think, business less this in even I dynamic, normal see the of is to impact we But row become total believe they'll into or account because take some for to drive, that of forward us enhanced become a

will for So -- be and and eventually what to the catch to on up longer trends step we'll trends waiting of in pricing kind be trends we're the loss term the up. ready our toes to

the of Grace, comparison tough because year-over-year, shutdown a if think, I it's all very orders. you're looking

good So there's percentage It's lines. how as trends sequentially. don't quarter And the were last or and conservative, think picks we whatnot, exposures there. to up where of bit, maybe we're just going back anything a tight and it's coming longer our pretty though overall, tail a the are quite year we of we low percentage you And second risks risk have book tend the would little increase our a we with appetite the feeling in particularly to there an lower the unusually I is either remind I is even it. for about a established low on starting rate nicely, and point fairly write

small comes book work our exclamation back, pricing back. back comes it's an performs the what XX%, I'm point, quickly. space. space where than are put And to in just Dick comp, is come This middle about When more better Grace. which it does just Yes, market Jeff the said, pricing significantly commercial is that

well these the we're costs return. loss as as So positioned

relative to And consistent year some past you. had thank pricing to Personal switching then Auto, competitors. Okay, I'm the you mentioned more over

to might trying So Lines. you benefit longer look lower to you take that rates balance peers as able your in than challenges. of I to the extent pricing wondering, wide frequency was Personal what extent that you versus all going industry And severity see term to think growth -- pricing potential you where that forward, impact are how just

earlier starting Many level marketplace have there. competition that business talked now to feeling needing we're amplified return general, major Jack in essentially some rate to to Dick rate normal in about you seeing heard in a and the filings Auto. we're is Grace, benefit players talk Right you're our it's of being see Personal And about get a of and good frequency. some the starting terms In that little of about Personal Line bit. the position really lingering happening, to opportunity.

throughout point, conservative we the also And optimistic. really quite is, XXXX feeling we make and last we're XXXX. set I in how So guess, loss were picks into I would

a to for temporary think So been for of sort worst margin the I sheet extent of prudently balance there's prepared scenario. pressure, has the case bit a

the our about retention, I'm to third good that has quarter. feeling our grow the quarter our in team late ability very and fourth made actions So

Thank you.

Grace. Thanks,

Our Scattergood. go next question is from Bob Farnam Please & ahead. with Boenning

morning. terms the two, whether is are curious as imagine improvement but you have products underwriting getting TAP well. tech there's in benefits a agencies. good business -- from line granular an couple I I've you're on understand the Maybe direct the and your component And there to was got be similar expecting questions is, of as that bottom a agents more more Hey competitors well? going And top Sales one that to I savvy some that you've first platform. way line the in to the I as got

So itself? how product the does Hanover’s differentiate

our is the to of the This latter then in to really of going which Thanks, about answer small to risk have enterprise well you underwriting to is just question, distinctive, tell really first address I'm ask there yes. your question Yes. your kind part BOP that commercial offering, accounts. approach in agents appetite for as we would the are with to that very addition an But as I overall We we -- use right? is accounts, package Dick talk and absolute, part Jack. of Bob. you

service are of We have we world-class a center. kind --

to they make that the the this out see agents one managers some age. help they We coming and with to -- it's really other the day consolidate they're particularly markets in markets, business best when of and to We're doing which BOP from carriers. that prepared oftentimes constantly of pricing been CSRs happen that pricing, sure we've volatility able deal so have proprietary not but the are volatile great agency

that other platform of in So I are the do make really creating that experience say we excited multifaceted, think things new us in space. context small the it's commercial sales about that the the we're distinctive is but all think TAP we we that important and to

specific dimensions. on multiple Absolute your So to question about improved yes results. underwriting

comes informed rollout, can refined, data hundreds our which rules to that and moved renewal this where we've by One new on this third-party of upon, in built that the the again, customers. more knockout platform the that's elements efficacy makes can so on pricing chassis slot underwriting integrate much in improved the data is are along refined also, of the of upwards of also third-party now, segmentation, which the side. way a more a broad-based pricing cells is we with pricing And

data, make is pull risk when piece how a we adjustments. can we appropriate we third-party of that ourselves, in And So changed? business asked renews,

to which So that going the loss we ratio. multiple improve it's believe there's forward, at dimensions going were

with far? a comment industry how maybe reaction Dick the on agents and the so this in fits others

this a reaction and to we're account policies. fabulous Yes, issue that getting use managers the price from and frontline CSRs

sort marketplace his, As fastest in of Jack really efficient our are today. his system prior getting system sort that than in XX% more and believe out said, of best-in-class commentary. commentary, It's the we that's there the

So thrilled. in we're multimillion and received multiyear and that's we dollar happier the with way has being been a This the be investment, couldn't marketplace.

mean, And you're on your broad this still all but this roll products products. are I your not point. system you're capabilities, to continuing at talking product up about

numbers I So the platform small what you the business put -- just know, out.

what's of there? So up you're trying next to in coming terms what push out

we package. will a on lives rest differentiation, have. ancillary And that every in the account in part advantage owners year, product of already business offering, the the our refine. office frankly Jack. every are Bob is be further The of get work agency we'll just this lines, We're of the very they'll which Bob this much throughout we product then core

At differentiate it's in pricing. terms the workers of package. we we comp and it. and with and is then coverage end where that's umbrella. auto sophistication So ourselves in why the lead the day, of by supported And

excited tell that the this in impact would this half make XXXX. So that really heading of into second you I year then and will about we're that the

for color. thanks the Great,

you, Bob. Thank

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

you participation looking Investor Day. you our we're to today. in forward Thank everybody to for And your talk

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

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