Slide 1: Investor Presentation
Investor Presentation NYSE: HCI | SEPTEMBER 2024
Slide 2: Forward-Looking Statement
This presentation includes certain forward‐looking statements and information, including statements regarding plans, strategies and expectations of HCI Group, Inc. (“HCI” or the “Company”). When used in this presentation, words such as “believes,” “anticipates,” “expects,” “estimates,” Forward-Looki
Slide 3: HCI at a Glance
Stock Price2 $95.83 Est. Market Capitalization2 $1.0B Insurance Insurance Carriers Solutions Price-to-TTM Earnings 7.5x Book Value/Share $42.72 HCI at a Glance Dividend Yield2 1.7% In-Force Premium3 $1,081M Debt to Capital 34% Founded/IPO 2006/2008 Reinsurance Real Estate Management Tenure 13 years
Slide 4: Investment Thesis
Investment Thesis An insurance holding company with operations in Homeowners Insurance, Information Technology Solutions, Reinsurance, and Real Estate 2006 founded Combining technology and industry knowledge to drive profitable growth consecutive quarters Allocating capital with purpose and discipli
Slide 5: Growing Through Investment & Innovation
Growing Through Investment & Innovation HCI Group premium TypTap launches in force exceeds Executed Launched Launched nationwide expansion $1 billion first Citizens real estate TypTap insurance assumption division business Completed initial Condo Owners public offering Reciprocal Incorporated Introd
Slide 6: HCI Operational Divisions
HCI Operational Divisions Reinsurance Insurance Carriers Insurance Solutions Real Estate Claddaugh Homeowners Choice P&C Exzeo Greenleaf Insurance Company (technology division) TypTap Insurance MGA Services Company (division responsible for product, rates & forms, reinsurance, etc.) Condo Owners Rec
Slide 7: Insurance Carriers
Insurance Carriers 6
Slide 8: Overview of Insurance Divisions
Overview of Insurance Divisions Launched in 2007 Launched in 2016 Commenced operations in 2024 as reciprocal exchange Homeowners and Technology-driven condominium owners homeowners insurance Writes Florida-based insurance primarily in Florida commercial residential lines Utilizes independent agent H
Slide 9: A Growing Homeowners Business
A Growing Homeowners Business 1 Premium in Force (in $M) Geographic Footprint $1,081 $995 $719 $737 $528 $353 $338 $369 2017 2018 2019 2020 2021 2022 2023 Q2-24 Best-in-class Proactively Deploying Excess Opportunistically Underwriter in the Managing Risk Capital Into Investments Add Policies Florida
Slide 10: A Profitable Homeowners Business
A Profitable Homeowners Business Loss Ratio 1 Leverage Impact technology to of Legislative constantly Reforms in evaluate Florida underwriting criteria 48% Gross loss ratio has benefitted from a: • Rate adequacy • Exposure • 25% decline management in claims frequency 34% •Legislative 35% decline in
Slide 11: Steady Improvement
Steady Improvement Shareholders Equity (in $M) Invested Assets (in $M) $447 $1,235 $1,057 $325 $850 $163 2022 2023 Q2-24 2022 2023 Q2-24 Book Value Per Share Debt Leverage (%) 1 $42.72 57% $33.36 39% 34% $18.91 2022 2023 Q2-24 2022 2023 Q2-24 10 (1) Excludes preferreds
Slide 12: Insurance Solutions
Insurance Solutions
Slide 13: Overview of Insurance Solutions Division
Overview of Insurance Solutions Division Technology Platform MGA Services Claims Services Launched in 2012 Includes Homeowners Griston Claims Services is Choice Managers Inc., a wholly owned division of TypTap Management HCI Group Wholly-owned technology Company, CORE AIF subsidiary Handles all inte
Slide 14: HCI Developed its Own Technology
HCI Developed its Own Technology Exzeo Was Launched in 2012 to Build and Develop TypTap’s Entire Technology Stack Wholly-owned technology subsidiary Started writing flood Launched policies after Launched A team of over 150 Exzeo Launched Casaclue and 4 years of Launched homeowners National experienc
Slide 15: Technology Advantages
Purpose-built technology suite 100% owned by TypTap Differentiated data and proprietary analytics creating superior underwriting results Technology Advantages Aggregation of profitable properties is enhanced by high customer retention rate Ease of use for a frictionless policyholder and agent experi
Slide 16: We Use Technology to Underwrite at the Individual Property Level
We Use Technology to Underwrite at the 73%1 Individual Property Level industry average loss ratio Differentiated Strategy Up to 1000 Data Points per Property Individual property level risk evaluation Individual Property Level Risk Selection Only write insurance for homes that are expected to be prof
Slide 17: Individual Level Risk Evaluation Results in Lower Loss Ratio
Individual Level Risk Evaluation Results in Lower Loss Ratio Property level (HCI insurance carriers) vs. zip code level (industry) Algorithms can determine “green properties” vs. “red properties” in the same neighborhood 16
Slide 18: Reinsurance
Reinsurance yo. * oe ;
Slide 19: Claddaugh Generating Profits for Our Shareholders
Claddaugh Generating Profits for Our Shareholders Cumulative Net Premium Earned Since 2008 $200 $180 Claddaugh is used to $160 opportunistically manage reinsurance cycles for HCI’s $140 insurance divisions. $120 $100 $80 $60 $40 Since its formation in 2008, $20 Claddaugh has contributed 1 $58M in pr
Slide 20: Real Estate
Real Estate 19
Slide 21: Creating Value in Real Estate
Acquire properties with differentiated value drivers Creating Value in Real Estate Optimize Reinvest or capital harvest Greenleaf Capital owns and structure operates HCI’s real estate portfolio. Its holdings include a set of premier commercial assets in rapidly growing Florida. Develop or reposition
Slide 22: Recent Sales Transactions
Generating Gains from our Real Estate Portfolio PROPERTY LOCATION DATE PURCHASED GROSS PROCEEDS2 BOOK VALUE PRE-TAX GAIN1 Recent Sales Transactions Office Building Tampa 2010 $44.0M $7.0M $37.0M Office Building Tampa 2017 $14.5M $1.1M $13.4M Grocery Anchored Retail Eustis, FL 2016 $13.0M $10.6M $2.5
Slide 23: Florida Real Estate Portfolio With Embedded Value
Florida Real Estate Portfolio With Embedded Value PROPERTY APPRAISED VALUE (1) BOOK VALUE(3) DEBT ON PROPERTY Office Portfolio $25M $18M $4M OPERATING Anchored Retail 28M 17M $11M Waterfront Specialty Use Portfolio 40M 17M - DEVELOPMENT UNDER Properties Under Development 46M 42M - $139M1 $94M APPRAI
Slide 24: Homeowners Choice Investment Portfolio
Homeowners Choice Investment Portfolio A conservative allocation, positioned for higher rates and opportunistic investments 1% 10% Cash 23% Fixed Income Real Estate & Other Total invested assets1 $395 million Equity Limited Partnerships Fixed Income Average Duration ~1 year 66% (1) As of 6/30/24 23
Slide 25: TypTap Investment Portfolio
TypTap Investment Portfolio A conservative allocation, positioned for higher rates and opportunistic investments 1% 15% Cash Fixed Income Total invested assets1 $392 million Equity Limited Partnerships Fixed Income Average Duration ~1 year 84% (1) As of 6/30/24 24
Slide 26: Experienced & Focused Leadership Team
Experienced & Focused Leadership Team PARESH PATEL MARK HARMSW ORTH Chairman & Chief Executive Officer Chief Financial Officer, HCI Group ▪ Founder; Chairman since 2007 & CEO since 2011 ▪ CFO since 2017; previously SVP of Finance ▪ Designed HCI’s policy administration systems, leveraging software ▪
Slide 27: Delivering Shareholder Value
Delivering Shareholder Value capital returned to >$435M shareholders since inception2 18% insider ownership >2500% Total Shareholder Return since IPO 10-year average 16% ROE1 1) As of 6/30/2024 2) Includes $269M buybacks and $167M dividends 26
Slide 28: Contact Us
Contact Us I N V E S T O R R E L AT I O N S HCI C O N TA C T G R O U P, I N C . Bill Broomall, CFA 3802 Coconut Palm Drive VP, Investor Relations Tampa, FL 33619 Tel (813) 776-1012 Tel (813) 849-9500 wbroomall@typtap.com www.hcigroup.com contactus@hcigroup.com 27