Employers Holdings Inc · NYSE:EIG
Employers — Q4 2024 Earnings Presentation
34 slides from Employers's earnings presentation, Feb 21, 2025
Slide 1: Investor Presentation Fourth Quarter 2024
INVESTOR PRESENTATION Fourth Quarter 2024
Slide 2: Forward-Looking Statements
Forward-Looking Statements In this presentation, the Company and its management discuss and make statements based on currently available information regarding their intentions, beliefs, current expectations, and projections of, among other things, the Company's future performance, economic or market
Slide 3: Highlights: Continued Strong Performance In 2024
Highlights Continued Strong Performance In 2024 Strong Operating Excellent Capital Strong Enterprise Risk Solid Competitive Results Adequacy and Financial Management Position + Strong operating results Flexibility + Experienced management + Currently the 19th largest and growth in book value + Stron
Slide 4: Business Overview
Business Overview 4 I E M P L O Y E R S . C O M I C O N F I D E N T I A L
Slide 5: Who We Are
Who We Are EMPLOYERS® is a mono-line writer of workers’ compensation Unique Growth Drivers insurance focused on low-to-medium hazard risk small businesses Specific to EMPLOYERS Transforming how small Over 100-year operating Unique, long-standing strategic businesses and insurance agents history, uni
Slide 6: What We Write
What We Write Top Ten Employer Restaurants and Other Eating Places 17% Classifications Traveler Accommodation 6% Building Finishing Contractors 5% Services to Buildings and Dwellings 4% Building Equipment Contractors 4% Real Estate Management 3% Schools 3% Architectural, Engineering and Related Serv
Slide 7: Markets and Distribution
Markets and Distribution $776 Million 2024 Gross Written Premiums Low-to-Medium Hazard Focus Shown as a percentage of Specialty 12/31/24 in-force premium Agents, Distribution Partners and 91% 9% DTC Hazard Groups Hazard Groups 35% A-E (lower risk) F-G (higher risk) Traditional Insurance Agents 65% $
Slide 8: Markets and Distribution Continued
Markets and Distribution Continued We market and Traditional Insurance Specialty Agents and DTC sell our workers' Agents and Brokers Distribution Partners Direct-to-customer compensation 65% 34 % 1% of in-force premium of in-force premium of in-force premium at 12/31/24 at 12/31/24 at 12/31/24 insur
Slide 9: Market Share
Market Share 2023 Property and Casualty Insurance Industry DI RECT DI RECT PREMI UMS PREMI UMS MARKET RANK GROUP/COMPANY NAME W RI TTEN EARNED SHARE % We are the 19th largest 1 TRAVELERS GRP 3,866,767,331 3,849,946,580 6.6 2 HARTFORD FIRE & CAS GRP 3,771,503,918 3,711,058,710 6.5 Workers’ Compensati
Slide 10: Accolades
Accolades In September 2024, Employers received the #3 spot on Newsweek’s 2024 list of Most Trustworthy Companies in America and the #7 spot in that publication’s 2024 ranking of Most Trustworthy Companies in the World. Each of these We were recently applauded by rankings were within the lists’ insu
Slide 11: Growth in Premium and Policy Count
Growth in Premium and Policy Count Over the past five years we have grown our Gross Written Premiums by 34%. Gross Written Premiums can, at times, be heavily Gross Written and InForce Premiums* influenced by final audit premium adjustments, $850 through which we recognize the final audit $800 Post-C
Slide 12: Current Initiatives and Strategy
Current Initiatives and Strategy 12 I E M P L O Y E R S . C O M I C O N F I D E N T I A L
Slide 13: Appetite Expansion
Appetite Expansion Beginning in 2021, we extended our reach by applying our established underwriting Background approach to new industries including plumbing, painting, and landscaping. This has provided meaningful and complementary growth for the company, as we’ve been able to identify and partner
Slide 14: Appetite Expansion (continued)
Appetite Expansion (continued) 2025 2022 - 2025 Premium Incurred Loss Major Hazard Major Class AE Segment Distribution Ratio Groups Codes Plumbing 3.7% E, F 5183, 5537, 5187 Paint 3.5% G 5474 Landscape 3.4% C 0042 Electrical 2.0% F 5190, 5140 Janitorial 1.9% C 9008, 9014 Property Mgmt 1.5% D 9011, 9
Slide 15: Cerity Integration
Cerity Integration ® During the fourth quarter of 2023, we fully integrated Cerity’s operations into those of Employers. As a result, policies issued by Cerity and Employers are now administered and serviced consistently on a single platform, generating significant These actions, which are the effic
Slide 16: North Star of Ease
North Star of Ease KEY INVESTMENT STREAMS Our strategic North Star of Ease initiative serves Distribution as a guide to making our internal operations more Our new agency partnership program better meets the needs of our highest-performing agency partners and seamless and scalable and our external s
Slide 17: Artificial Intelligence Vision
Artificial Intelligence Vision To be a forward-thinking, AI-empowered organization that leverages advanced technology responsibly and effectively to optimize decision-making, enhance customer experiences, and remain a leader in the insurance industry We take AI seriously and know that it will shape
Slide 18: Strategic Diversification
Strategic Diversification By in-force premium Our California concentration, as measured by in-force premium, is higher than that on a policy basis because California business has higher premiums per policy than most other states. All Other 30% All CA Other 45% 28% CA 60% 4% NJ 4% GA GA 5% 4% IL IL 3
Slide 19: Book Mix by Hazard Group
Book Mix by Hazard Group Our appetite expansion effort continues to be a large contributor to our profitability and growth in premium. Our loss ratios in these new segments continue to be in- line or better than our traditional segments and we expect to further benefit from this strategy well into t
Slide 20: Financial Performance
Financial Performance 20 I E M P L O Y E R S . C O M I C O N F I D E N T I A L
Slide 21: Fourth Quarter 2024 Highlights
Fourth Strong Insurance Strong Balance Sheet Quarter Financial Results Operations and Capital Mgmt. 2024 Highlights Adjusted Net Income Gross Premiums Written Total Investments and Cash $28.7M $176.3M or $1.15/share -1% from 4Q23 $2.5B 4Q24 Share Net Investment Net Premiums Earned Repurchases Income
Slide 22: Full Year 2024 Highlights
Full Year Strong Insurance Strong Balance Sheet 2024 Financial Results Operations and Capital Mgmt. Highlights Total Investments Net Income Gross Premiums Written and Cash $118.6M $776M consistent with 2023 +1% from 2023 $2.5B 2024 Share Adjusted Net Income In-Force Premiums Policies In-Force (incl
Slide 23: Five-Year Annual Financial Performance
Five-Year Annual Financial Performance Adjusted EPS (Diluted) Adjusted ROE $3.83 $3.73 8.5% 7.6% 7.7% $3.10 $2.93 6.6% $2.37 5.5% 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024 Combined Ratio excluding LPT Adjusted Book Value per Share $50.71 93.4% 98.1% 96.0% 98.6% 94.0% 27.9% 24.8% 24.9% 23.5%
Slide 24: Financial Strength
Financial Strength 24 I E M P L O Y E R S . C O M I C O N F I D E N T I A L
Slide 25: Net Investment Income
Net Investment Income Our net investment income in 2022 and Up nearly 50% versus 2021 2023 was enhanced by $6.3M and $7.6M + Weighted average book yield of fixed + Proactive management of investments of incremental net investment income, maturity investments of 4.5% (versus 3.0% formerly on deposit
Slide 26: Investment Portfolio
Investment Portfolio Consolidated $2.5 billion fair market value, including cash + High quality (average credit quality of A+) + 2024 total investment return of 5.4% CLOs 2% + Highly liquid ($1,149 million is unencumbered + 4.5% average ending pre-tax book yield All at the operating companies and is
Slide 27: History of Reserve Strength
History of Reserve Strength Reserves are reviewed internally each quarter, with full reviews occurring in 2Q and 4Q $450 Reserve estimates are presented to $400 $382 $400 the Audit Committee of our Board of Directors each quarter $350 $337 $305 $300 Fourth Quarter 2024 Reserve Study $267 $250 Recogn
Slide 28: Strong Capital Management
Strong Capital Management Year ended 2024: Year ended 2023: The shares we repurchased during 2023 and 2024 were accretive to $41.4M $76.4M our current book value per share including the deferred gain Aggregate share repurchases, excl. excise taxes Aggregate share repurchases, excl. excise taxes ($47
Slide 29: Strong and Transparent Balance Sheet
Strong and Transparent Balance Sheet • Low premium leverage and reinsurance reliance Our balance sheet is • Favorable reserving track record strong and is unburdened by either legacy issues or • LPT protection a significant amount of goodwill and other • High-quality reinsurance recoverables intangi
Slide 30: Environmental, Social and Governance (ESG)
Environmental, Social and Governance (ESG) 30 I E M P L O Y E R S . C O M I C O N F I D E N T I A L
Slide 31: Our ESG Strategy
Our ESG Strategy As a U.S. domestic workers' compensation provider with a small real- estate footprint, our most significant ESG considerations are primarily limited to: (i) the potential impacts of climate change and increased climate change awareness to our investment portfolio over time; (ii) Emp
Slide 32: Key Takeaways
Key Takeaways From our 4Q24 Earnings Release dated February 21, 2025: + Excellent market reputation and optimally positioned as a “Chief Executive Officer Katherine Antonello Workers’ Compensation specialist, commented: “We are pleased with our fourth quarter and full-year 2024 results. In fact, we
Slide 33: Contact Information
Contact Information Investor Relations Contact: Media Contact: Mike Paquette Kimberly Eye Executive Vice President, Vice President, Chief Financial Officer Marketing & Communications EMPLOYERS HOLDINGS, INC. mpaquette@employers.com keye@employers.com 5340 Kietzke Lane, Suite 202 Katherine “Kathy” An
Slide 34: Additional Financial Information
Additional Financial Information Reconciliation of Non-GAAP Financial Measures to GAAP Within this investor presentation we present various financial measures, some of which are "non-GAAP financial measures" as defined in Regulation G pursuant to Section 401 of the Sarbanes-Oxley Act of 2002. A desc