Global Indemnity Group, Llc · NASDAQ:GBLI
Global Indemnity — Investor Day (September 2021)
50 slides from Global Indemnity's investor day presentation, Sep 13, 2021
Slide 1: Global Indemnity Investor Day
Global Indemnity Investor Day Performance and Objectives The Peninsula Hotel, NY, NY September 13, 2021 1 pm – 2 pm Eastern
Slide 2: Forward-Looking Statement
Forward-Looking Statement This presentation may include forward-looking statements, both with respect to Global Indemnity Group, LLC (the "Company”) and its industry, that reflect our current views with respect to future events and financial performance. These statements are made pursuant to the saf
Slide 3: Today's Agenda
Today's Agenda Chairman’s Presentation Saul Fox Chairman Strategic Vision David Charlton Chief Executive Insurance Business Update Jonathan Oltman President Operations and Technology Reiner Mauer Chief Operations Officer Financials Thomas McGeehan Chief Financial Officer Questions and Answers Stephe
Slide 4: Today's Presenters
Today’s Presenters Saul Fox David Charlton Jonathan Oltman Reiner Mauer Thomas McGeehan Chairman Chief Executive President Chief Operating Officer Chief Financial Officer Investor Day 2021 4
Slide 5: Saul Fox, Chairman
Saul Fox Chairman
Slide 6: Background on Fox Paine Fund II & Saul Fox
Background on Fox Paine Fund II & Saul Fox Fox Paine Fund II • Global Indemnity was one of six platform (build-up) investments in Fox Paine Fund II, which was launched in 2000. Fox Paine Fund II invested $682 million in aggregate across ($ in millions) $1,936 the six platform investments from which
Slide 7: Opportunities for Growth and Profitability from the Redomestication
Opportunities for Growth and Profitability from the Redomestication • Global Indemnity, initially organized offshore in 2003, redomesticated to the United States from the Cayman Islands in August 2020, which facilitated several opportunities for the Company’s growth and profitability: o Prior to the
Slide 8: Board Objectives for Global Indemnity Group, LLC
Board Objectives for Global Indemnity Group, LLC Board Objectives: • As a result of the changes enabled by the redomestication, including, most 2022-26 Net Written Premium importantly, the significant augmentation of the Company’s executive leadership, CAGR 8.00% the Board established new long-term
Slide 9: Board Objectives are Supported by Core Business Performance
Board Objectives are Supported by Core Business Performance Net Written Premium of Core • Global’s core small business commercial specialty businesses, United National Commercial Specialty Business2 (acquired 2003) and Penn-America (acquired 2005), have performed admirably over (52% of Total NWP in
Slide 10: Growth & Capital Required from Board Objectives
Growth & Capital Required from Board Objectives Earnings Per Share 8% NWP CAGR • At the midpoint of the performance objectives incorporated in the Company’s 7% NWP CAGR 4 12% ROE 10% ROE $7.60 Chief Executive Officer’s and Chief Operations Officer’s agreements: 6% NWP CAGR $6.21 8% ROE o Net Written
Slide 11: Expected Shareholder Returns from Board Objectives
Expected Shareholder Returns from Board Objectives • If the Company achieves the Board’s objectives over the next Implied Share Price E&S Top five years, it will result in Book Value Per Share increasing (including cumulative dividends) Quartile Performance: from $49 at 12/31/21 to between $66 and $
Slide 12: David Charlton, Chief Executive
David Charlton Chief Executive
Slide 13: Executive Leadership
Executive Leadership David S. Charlton, Chief Executive Career Highlights • 34-year veteran Property & Casualty insurance industry senior executive, with particular expertise in Excess and Surplus lines, binding authority, small business, and other specialty insurance businesses • Served for seven y
Slide 14: Strategic Vision for Global Indemnity Group
Strategic Vision for Global Indemnity Group Best in class specialty insurance company focused on small to middle market business achieving steady growth and a consistent combined ratio in the low 90’s. Investor Day 2021 | 14
Slide 15: Strategic Vision Roadmap
Strategic Vision Roadmap To become the best-in-class Specialty Insurance Company Here is how we will get there: PEOPLE: REVENUE: OPERATIONS: INVESTMENTS: We have enhanced our We have developed and Analytics will play an Traditionally we have been existing team with have begun to implement increased
Slide 16: Experienced Talent
Experienced Talent It all starts with people and an investment in talent. Thomas McGeehan Thomas Gibbons Jonathan Oltman Chief Financial Officer, Executive Vice President & Chief Actuary, President, 20 years of service 6 years of service 7 years of service Stephen Ries David Elliott Michael Loftus S
Slide 17: Investment in New Executive Talent
Investment in New Executive Talent Senior Insurance Executives hired since May of 2021 David Charlton Reiner Mauer Marc Garganigo Melanie Herring Evan Kasowitz Chief Executive Chief Operating Officer Division Leader Product Management Strategic Development & Management & & Development Division Leade
Slide 18: Global Indemnity Core Business Strategy
Global Indemnity Core Business Strategy Develop and focus on core businesses that drive long term consistent and sustainable profitability Core Businesses are industry segments that: Have a proven Are comprised of Are specialty or Are casualty Are supported by track record of small to middle niche i
Slide 19: Global Indemnity Core Business Strategy
Global Indemnity Core Business Strategy Grow Current Build New Adapting Strategy To Make Core Businesses Core Businesses Businesses Core • Penn-America Binding • Professional Lines • Farm, Ranch and • Cannabis • Environmental Equine • Collectibles • Excess Casualty • Property • Programs • Personal L
Slide 20: Grow Core Business Strategy: Penn-America Binding
Grow Core Business Strategy: Penn-America Binding Penn-America Binding C/Y Combined Ratio $MM $200 110% $180 $160 $140 96.7% 100% $120 94.4% $100 $80 88.0% 89.4% 90% $60 $40 $20 $126.5 $155.7 $164.3 $89.6 $0 80% 2018 2019 2020 6M Ended June 30, 2021 Core Business Characteristics: • Trending to grow
Slide 21: Penn-America Binding: High Margin, High Income Strategy
Grow Core Business Strategy: Penn-America Binding High Margin, High Income Go Forward Strategy Growing the Tiered binding business Maximizing Targeting low loss Commission within 8 high wholesaler’s profit ratio business Structure preforming share incentives segments 2021 Approach Piloting “High M
Slide 22: High Margin, High Income Example: Auto Services
Grow Core Business Strategy High Margin, High Income Example: Auto Services AUTO SERVICES Specialty class of business that: PROVEN TRACK RECORD OF P R O F I TA B L E G R O W T H • Has a proven track record of Gross Written Premium profitable growth $8,000,000 • 35% CAGR since our 2017 $7,000,000 $6,
Slide 23: Grow Current Core Businesses: Cannabis
Grow Current Core Businesses: Cannabis Cannabis C/Y Combined Ratio $MM $30 100% 87.0% 90% $25 80% $20 60.4% 58.9% 70% 60% $15 44.1% 50% 40% $10 30% 20% $5 $0.2 $7.3 $13.4 $6.1 10% $0 0% 2018 2019 2020 6M Ended June 30, 2021 Core Business Characteristics: • $4.8 premium reduction in large accounts in
Slide 24: Grow Current Core Businesses: Collectibles
Grow Current Core Businesses: Collectibles Collectibles C/Y Combined Ratio $MM $20 80% 70% $15 59.5% 60.4% 56.6% 60% $10 50% 40% $5 28.9% 30% $9.2 $10.5 $11.1 $6.5 $0 20% 2018 2019 2020 6M Ended June 30, 2021 Core Business Characteristics: • Trending to grow 18% in 2021 through social media campaign
Slide 25: Grow Current Core Businesses: Programs
Grow Current Core Businesses: Programs Programs C/Y Combined Ratio $MM $120 120% 94.0% 99.7% $100 92.2% 100% 75.4% $80 80% $60 60% $40 40% $20 20% $51.4 $73.4 $95.7 $66.1 $0 0% 2018 2019 2020 6M Ended June 30, 2021 Core Business Characteristics: • Trending to grow 33% in 2021 due to new programs and
Slide 26: Grow Current Core Businesses: Casualty Reinsurance
Grow Current Core Businesses: Casualty Reinsurance Casualty Reinsurance C/Y Combined Ratio $MM $90 160% 144.2% 150% $80 140% $70 130% 120% $60 110% $50 94.8% 95.2% 100% 87.3% 90% $40 80% $48.0 $88.3 $60.7 $46.5 $30 70% 2018 2019 2020 6M Ended June 30, 2021 Core Business Characteristics: • Trending t
Slide 27: Grow Current Core Businesses: Vacants
Grow Current Core Businesses: Vacants Vacants C/Y Combined Ratio $MM $30 100% 90% $20 77.6% 80% 63.8% 70% $10 60.7% 58.3% 60% $24.0 $25.6 $24.3 $11.4 $0 50% 2018 2019 2020 6M Ended June 30, 2021 Core Business Characteristics: • Production still slow for residential – a result of record low inventory
Slide 28: Grow New Core Businesses Strategy: Professional Lines
Grow New Core Businesses Strategy: Professional Lines The Chief Executive has a history of building highly profitable (low 90’s Combined Ratios or better) Professional Lines divisions at Philadelphia Insurance Companies, USLI and Westchester, a Chubb Company. Product Mix: Management Liability Avoid
Slide 29: New Core Business Leadership & Objectives: Professional Lines
New Core Business Leadership & Objectives: Professional Lines Marc Garganigo, Division Leader Objectives for 2021 • 30-year veteran Professional Lines executive • Placement of Reinsurance • Most recently as Senior VP – Head of • Develop forms, rates, and Management and Professional Liability at unde
Slide 30: Grow New Core Businesses Strategy: Professional Lines
Grow New Core Businesses Strategy: Professional Lines Strategy: Build a Profitable & Execution Sustainable Portfolio • Focus on risk selection Q1 2022 Objectives and underwriting • Launch Admitted and Non- profitability in the small Admitted Products & middle market space • Continue to aggressively
Slide 31: New Core Business Leadership & Objectives: Environmental
New Core Business Leadership & Objectives: Environmental Dennis Willette Objectives for 2021 • Extensive experience within Environmental at • Identify key hires for initial market leading firms environmental leadership team • Most recently Vice President and Manager of • Placement of Reinsurance Env
Slide 32: Grow New Core Businesses Strategy: Environmental
Grow New Core Businesses Strategy: Environmental Strategy: Build a Profitable & Environmental Products Execution Sustainable Portfolio • Focus on risk selection • Contractors Pollution Q1 2022 Objectives and core profitable • Contractors Pollution & • Launch Contractors Pollution & product lines Pro
Slide 33: New Core Business Leadership & Objectives: Excess Casualty
New Core Business Leadership & Objectives: Excess Casualty Biju Joy, Division Leader Objectives for 2021 • 30-year insurance veteran Excess Casualty • Placement of reinsurance • Most recently as Vice President and Manager • Develop forms, rates and of Excess Casualty at Philadelphia Insurance underw
Slide 34: Grow New Core Businesses Strategy: Excess Casualty
Grow New Core Businesses Strategy: Excess Casualty Strategy: Build a Profitable & Excess Casualty Classes Execution Sustainable Portfolio • Establish a premier • Manufacturing Q1 2022 Objectives standalone excess • Construction • Monitor the product line casualty division • Real Estate using in port
Slide 35: Jonathan Oltman, President
Jonathan Oltman President
Slide 36: Adapting Strategy To Make Businesses Core: Farm, Ranch, and Equine
Adapting Strategy To Make Businesses Core: Farm, Ranch, and Equine Agriculture C/Y Combined Ratio $MM $100 120% $90 $80 110% $70 102.2% 101.1% 100.8% 102.9% $60 $50 100% $40 $30 90% $20 $10 $79.7 $87.7 $85.6 $41.8 $0 80% 2018 2019 2020 6M Ended June 30, 2021 How we are adapting: • 2021 Gross Written
Slide 37: Adapting Strategy To Make Businesses Core: Farm, Ranch, and Equine
Adapting Strategy To Make Businesses Core: Farm, Ranch, and Equine Farm and Ranch currently writes approximately $36M of Equine related risks • Property, General Liability, Commercial Auto, Umbrella, Mortality (Horse Life & Health) • Equine business is 10 points more profitable than the remainder of
Slide 38: Adapting Strategy To Make Businesses Core: Property
Adapting Strategy To Make Businesses Core: Property Property C/Y Combined Ratio $MM $50 237.7% 250% $45 230% $40 210% $35 190% $30 170% $25 137.3% 116.1% 150% $20 101.1% 130% $15 110% $48.1 $42.6 $37.6 $16.8 $10 90% 2018 2019 2020 6M Ended June 30, 2021 How we are adapting: • 2021 Gross Written Prem
Slide 39: Adapting Strategy To Make Businesses Core: Personal Lines
Adapting Strategy To Make Businesses Core: Personal Lines (Mobile Home, Dwelling, and Homeowners) Personal Lines C/Y Combined Ratio $MM $160 160% 147.3% 150% $140 140% $120 123.3% 130% $100 120% 110% $80 97.6% 94.7% 100% $60 90% $148.2 $137.9 $127.0 $60.0 $40 80% 2018 2019 2020 6M Ended June 30, 202
Slide 40: Reducing CAT Exposure: Personal Lines
Reducing CAT Exposure: Personal Lines (Mobile Home, Dwelling, and Homeowners) How we are adapting: • Continuing to execute reductions in CAT prone areas; on track to be off majority of defined risks by the end of Q2 2022 Investor Day 2021 | 40
Slide 41: Reiner Mauer, Chief Operating Officer
Reiner Mauer Chief Operating Officer
Slide 42: Operations: 2021 Initiatives
Operations: 2021 Initiatives Hired Alan Hirst, Chief Information Officer • 23-year veteran of the Financial Information Technology Industry • Most recently as Head of Architecture for Commercial Insurance at The Hartford • Served as VP and Chief Architect for Axis Capital Key IT Initiatives • Develo
Slide 43: Operations: 2021 Initiatives
Operations: 2021 Initiatives Key IT Initiatives: ClarionDoor Partnership Executed agreement with ClarionDoor allows for timely impact on: • New Small Commercial Penn-America products o Special Events o Umbrella/Excess • Added leverage for New Core Business Divisions o Professional Lines o Environmen
Slide 44: Thomas McGeehan, Chief Financial Officer
Thomas McGeehan Chief Financial Officer
Slide 45: The Company's 2021 Business Forecast
The Company’s 2021 Business Forecast Gross written premium expected to increase 10% over 2020 • Commercial Businesses are expected to grow 16% over 2020 due to organic growth in the Company’s excess and surplus lines business from existing agents, increased pricing, and several new programs partiall
Slide 46: Conservative Balance Sheet/Asset & Liability Management
Conservative Balance Sheet/Asset & Liability Management Global Indemnity takes a conservative approach to managing its Assets and Liabilities • AM Best, the preeminent insurance industry rating agency, in its April 21, 2021 press release confirming Global Indemnity’s ‘A’ Excellent rating, stated tha
Slide 47: Shareholders' Equity
Shareholders’ Equity Capital supports the business and provides returns to shareholders • Global Indemnity Group, LLC held $710 million $1,400 of Shareholder’s Equity at June 30, 2021 $1,200 • Capital supports the current business, growth and other initiatives $1,000 • $130 million of subordinated n
Slide 48: Diverter tte tetetnes Sir
Diverter tte tetetnes Sir
Slide 49: Appendix
Appendix
Slide 50: Non-GAAP Financial Measures
Non-GAAP Financial Measures This presentation includes certain financial information that differs from what is reported under U.S. GAAP. These non-GAAP financial measures, which include, but are not limited to, normalized return on equity and normalized investment gain, are presented in order to sup
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