Employers Holdings Inc · NYSE:EIG
Employers — Q1 2024 Earnings Presentation
24 slides from Employers's earnings presentation, Apr 26, 2024
Slide 1: Investor Presentation First Quarter 2024
INVESTOR PRESENTATION First 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: Business Overview
EMPLOYERS® Business Overview www.employers.com 3
Slide 4: Who We Are (the Numbers)
Who We Are (the Numbers) EMPLOYERS® is a mono-line writer of workers’ compensation (WC) insurance focused on low-to-medium hazard risk small businesses. MARKETS AND DISTRIBUTION $211 Million $758 Million 1Q24 Gross Written Premiums In-force Premium at March 31, 2024 (incl. est. audit premium) Low-to
Slide 5: Who We Are (the Words)
Who We Are (the Words) UNIQUE GROWTH Over 100-year operating history DRIVERS SPECIFIC TO EMPLOYERS Strong underwriting focus with Transforming how small established presence in attractive markets businesses and insurance agents utilize digital capabilities to improve Record number of policies in-for
Slide 6: What We Write
What We Write Top Ten Employer Classifications % of Premium Restaurants & Other Eating Places 17% Traveler Accommodation 6% Automobile Dealers 4% Services to Buildings and Dwellings 4% Automobile Repair and Maintenance 3% Real Estate Management 3% Schools 3% Offices of Physicians 3% Other Store Reta
Slide 7: Marketing And Distribution
Marketing And Distribution We market and sell our workers' compensation insurance products through: • Local, regional, specialty and national insurance agents and brokers; • National, regional, and local trade groups and associations; and • Direct-to-customer interactions. Traditional Insurance Spec
Slide 8: 2023 Workers' Compensation Market
2023 Workers’ Compensation Market PROPERTY AND CAS UALTY I NS URANCE I NDUS TRY DI RECT DI RECT PREMI UMS PREMI UMS MARKET RANK GROUP/COMPANY NAME W RI TTEN EARNED S HARE % 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 3 AMTRUST FINANCIAL S
Slide 9: Market Conditions
Market Conditions In-Force Policies and Premium $800 175,000 $758 $750 150,000 $700 127,484 125,000 # of policies $ in millions $650 100,000 $627 $600 $550 85,494 BEFORE AFTER 75,000 COVID`-19 COVID-19 PANDEMIC PANDEMIC $500 50,000 12/31/17 12/31/18 12/31/19 12/31/20* 12/31/21* 12/31/22* 12/31/23* 3
Slide 10: Five-Year Annual Financial Performance
Five-Year Annual Financial Performance Adjusted EPS (Diluted) Adjusted ROE $3.83 8.6% 8.5% $3.20 7.6% $3.10 $2.93 6.6% $2.37 5.5% 2019 2020 2021 2022 2023 2019 2020 2021 2022 2023 Combined Ratio excluding LPT Adjusted Book Value per Share $47.26 98.0% 98.1% 96.0% $45.67 94.0% 93.4% 24.8% $43.78 26.9
Slide 11: Strategy, Innovation and Capital Strength
EMPLOYERS® Strategy, Innovation and Capital Strength www.employers.com 11
Slide 12: Strategic Diversification
Strategic Diversification (by in-force premium) March 31, 2024 All other CA 30% December 31, 2013 45% 4% 28% NJ 4% 4% 60% GA 5% 8% 4% 5% IL 3% NY FL Growth outside of California is providing further diversification. www.employers.com 12
Slide 13: Focus on Low-to-Medium Hazard Groups
Focus on Low-to-Medium Hazard Groups 92% in Hazard Groups A-E March 31, 2024 Lower Risk Data shown as a % of in-force premium Group A Group B 19% 23% Groups F-G 8% Group E Group C 8% 21% Higher Risk Group D 21% 8% in Hazard Groups F-G We employ a thoughtful and conservative underwriting approach des
Slide 14: North Star of Ease
North Star of Ease In 2021, we announced our strategic North Star of Ease initiative to serve as a guide to making our internal operations Key Element #3 more seamless and scalable and our external The formation of a Test and Learn Center to understand systems more customer the impacts of our projec
Slide 15: Strong History of Favorable Reserve Development
Strong History of Favorable Reserve Development Net Calendar Year Reserve Development Reserve Review in Recent Prior Accident Years ($ millions, excludes involuntary business) Reserves are reviewed $450 internally each quarter, $400 $382 with full reviews $350 $337 occurring in 2Q and 4Q $300 $305 $
Slide 16: 1Q24 Financial Update
EMPLOYERS® 1Q24 Financial Update www.employers.com 16
Slide 17: First Quarter 2024 Highlights
First Quarter 2024 Highlights Strong Extremely Insurance Financial Strong Operations Results Balance Sheet Adj. Net Income Gross Premiums Written Total Investments $17.2M and Cash $210.9M or $0.67/share +8% from 1Q23 $2.5B 1Q24 Share Net Investment In-Force Premiums Policies In-Force Repurchases (in
Slide 18: Investment Portfolio (at March 31, 2024)
Investment Portfolio (at March 31, 2024) $2.4 billion at fair value ($2.5 billion including cash) • High quality (average credit quality of A+) • Highly liquid with $959 million unencumbered at the operating companies and available within 3 business days • Duration of 4.5 • 1Q24 annualized total inv
Slide 19: Environmental, Social and Governance (ESG)
EMPLOYERS® Environmental, Social and Governance (ESG) 2 0 2 3 TA S K F O R C E O N C L I M AT E R E L AT E D F I N A N C I A L D I S C L O S U R E S R E P O RT www.employers.com 19
Slide 20: Environmental
Environmental OUR INVESTMENT Our Investment Managers consider ESG criteria when evaluating investment opportunities. PORTFOLIO •Each of our Investment Managers are signatories to the United Nations Principles for Responsible Investment Group, an independent non-profit organization that encourages in
Slide 21: Social
Social • Committed to providing equal POLICYHOLDERS • The term "social inflation" employment opportunities to all qualified applicants AND THEIR generally refers to the trend of • Comprehensive Code of EMPLOYEES rising insurance costs due to increased litigation, plaintiff- Business Conduct and Ethi
Slide 22: Governance
Governance The Board Governance and Nominating Committee of our Board of Directors: Identifies and selects individuals qualified to serve as members of its Board and committees; Develops and recommends the Committee structure to the Board; Recommends to the Board a slate of Director-nominees f
Slide 23: Company Contact
Company Contact: Michael Paquette Executive Vice President, Chief Financial Officer (775) 327-2562 mpaquette@employers.com Katherine H. Antonello Michael S. Paquette President and Executive Vice President, Chief Executive Officer Chief Financial Officer www.employers.com 23
Slide 24: Additional Financial Information
Additional Financial Information Press Releases SEC Filings 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 Sarbane