Slide 1: Eastern Alliance Insurance Group
eastern Eastern Alliance Insurance Group fresh outlooks. better outcomes.” PROASSURANCE. Treated Fairly
Slide 2: Workers' Compensation Briefing, September 5, 2014
September 5, 2014 Workers' Compensation Briefing
Slide 3: Forward Looking Statements
F ORWARD L OOKING S TATEMENTS This presentation contains Forward Looking Statements and other information designed to convey our projections and expectations regarding future results. There are a number of factors which could cause our actual results to vary materially from those projected in this p
Slide 4: Eastern Transaction Rationale
Eastern Transaction Rationale Continues building the platform to serve the needs of large integrated health systems and healthcare delivery organizations Workers’ compensation represents one of the single largest liability expenditures for healthcare entities Eastern and ProAssurance underwrite larg
Slide 5: Eastern Transaction Rationale: Segregated Portfolio Cells
Eastern Transaction Rationale Eastern’s segregated portfolio cell structure and expertise will help expand alternative market opportunities to healthcare customers for workers’ compensation and professional liability Cross - selling opportunities exist Segregated Portfolio Cells Insureds Agents 5
Slide 6: Eastern Transaction Rationale: Diversification
Eastern Transaction Rationale Combination of the companies is very attractive from a product and geographic diversification perspective Provides revenue and earnings diversification for ProAssurance with a consistently profitable workers’ compensation book of business 6
Slide 7: Eastern Transaction Operations
Eastern Transaction Operations Eastern is a “bolt - on” transaction with limited integration risk Management remains in place to provide operational expertise and ensure continuity Eastern maintains its existing corporate, regional and satellite offices Eastern has access to greater capital to suppo
Slide 8: Eastern: Healthcare & More
Eastern: Healthcare & More 8 PROASSURANCE. Treated Fy
Slide 9: Michael Boguski, President
Michael Boguski President Py PROASSURANCE.
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Slide 11: History of Eastern
History of Eastern 1997 / 1998 1998 1999 2000 2001 2002 2003 Established WC operations in Lancaster, PA (114 - 116 W. Chestnut St.) Wrote $3.2 million of WC DWP (PA only) Eastern Re Ltd. was converted into a Segregated Portfolio Cell (SPC) Company Company headquarters moved to 322 N. Arch St. in Lan
Slide 12: History of Eastern (cont.)
History of Eastern (cont.) 2005 2006 2007 / 2008 2010 2011 2012 2013 / 2014 Wrote first policies in the states of Delaware and Maryland Wrote WC DWP of $78.9 million NASDAQ: EIHI Completed a $75.0 million stock offering and entered the public market via merger / conversion with Educators Mutual Life
Slide 13: Eastern Core Values and Culture
Eastern Core Values and Culture 13 RELATIONSHIPS : We work collaboratively with our business partners to improve their productivity and bottom line profitability . INNOVATION : We sustain a work environment that fosters energy, creativity, and a passion for excellence . Our employees are committed t
Slide 14: Eastern Senior Executive Team
Eastern Senior Executive Team Kevin Shook, Executive Vice President • 22 years of industry experience • Joined Eastern in 2001 Robert Gilpin, Senior Vice President of Field Operations and Marketing • 23 years of industry experience • Joined Eastern in 1998 Suzanne Emmet, Senior Vice President of Cla
Slide 15: 2014 Strategic Plan Highlights
2014 Strategic Plan Highlights Organic Growth Plan Geographic Expansion Strategy Healthcare Market Penetration Manage Profitability Integration and Organizational Excellence MIS Infrastructure Improvements 15
Slide 16: Kevin Shook, Executive Vice President
Kevin Shook Executive Vice President
Slide 17: EAIG Workers' Compensation Highlights
EAIG Workers’ Compensation Highlights 17 Direct Written Premium of $52.5 Million for the Three Months Ended June 30, 2014, and $46.2 Million for the Three Months Ended June 30, 2013 GAAP Combined Ratio – 90.0 (1) % for the Three Months Ended June 30, 2014 Focused State Expansion Regional/Satellite O
Slide 18: EAIG Business Model
EAIG Business Model Disciplined state strategy assessment process Disciplined individual account underwriting with focus on rate adequacy in rural territories Broad workers’ compensation product spectrum Broad underwriting diversification by class code and market segment Extensive medical cost conta
Slide 19: Workers' Compensation Product Line Diversification
Workers’ Compensation Product Line Diversification 19 Broad Product Spectrum Guaranteed Cost Policies Loss - Sensitive Dividend Plans Large and Medium Deductible Plans Retrospective Rating Plans Alternative Market Programs ParallelPay – “Pay as you Go” TPA Services, including Claims Administration a
Slide 20: EAIG Workers' Compensation Risk Diversification
EAIG Workers’ Compensation Risk Diversification 20 Clerical / Office, 17.2% Physician / Dentists, 9.2% Colleges/Schools, 8.7% Hospital, 6.6% Salesmen - Outside, 4.2% Auto Dealers, 4.2% Restaurant, 3.4% Nursing Homes - Skilled, 2.6% Retirement / Life Care Community, 2.3% Bank, 1.6% Top 10 Classes (Tr
Slide 21: EAIG Claim Closing Patterns - Traditional
EAIG Workers’ Compensation Claim Closing Patterns - Traditional 21 0 200 400 600 800 1,000 1,200 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Claims Closed 63 201 364 535 590 570 684 59
Slide 22: EAIG Geographic Footprint
EAIG Geographic Footprint 22 • Direct Written Premium of $198.7 Million for the Year Ended 12.31.13, and $182.9 Million for the Year Ended 12.31.12 • Direct Written Premium of $117.0 Million for the Six Months Ended 6.30.14 and $109.2 Million for the Six Months Ended 6.30.13 • Licensed – 30 states A
Slide 23: EAIG Workers' Compensation Geography Diversification
EAIG Workers’ Compensation Geography Diversification Pennsylvania, 81.1% Indiana, 10.3% North Carolina, 3.2% Maryland, 2.0% Delaware, 1.5% Virginia, 0.8% Other, 1.1% Pennsylvania, 55.9% Indiana, 10.8% North Carolina, 6.7% Delaware, 3.9% Virginia, 3.7% New Jersey, 3.3% South Carolina, 3.0% Maryland,
Slide 24: Benefits of Alternative Markets to Eastern / ProAssurance
Benefits of Alternative Markets to Eastern / ProAssurance Inova brand launched in Q1 of 2014 Very unique product offering for healthcare organizations that want to control costs for their most difficult - to - place and expensive insurance lines: workers’ compensation and medical professional liabil
Slide 25: EAIG Risk Diversification: Alternative Markets
EAIG Workers’ Compensation Risk Diversification Clerical/Office, 15.9% College/Schools, 7.5% Physician/Dentists, 7.3% Auo Dealers, 6.5% Salesmen - Outside, 6.0% Social Rehabilitation Facility, 3.8% Nursing Homes - Skilled, 3.7% Bank, 2.5% Grocery Store - Retail, 2.3% Ambulance Service - Non - Volunt
Slide 26: EAIG Claim Closing Patterns - Alternative Markets
EAIG Workers’ Compensation Claim Closing Patterns – Alternative Markets Results as of June 30, 2014 0 100 200 300 400 500 600 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Claims Closed 35 66 103
Slide 27: Robert Gilpin, SVP of Field Operations and Marketing
Robert Gilpin Senior Vice President of Field Operations and Marketing
Slide 28: Suzanne Emmet, SVP of Claims
Suzanne Emmet Senior Vice President of Claims
Slide 29: Cynthia Sklar, SVP of Underwriting and Risk Management
Cynthia Sklar Senior Vice President of Underwriting and Risk Management