American Coastal Insurance Corporation · NASDAQ:ACIC
American Coastal Insurance — Investor Day (December 2024)
29 slides from American Coastal Insurance's investor day presentation, Dec 4, 2024
Slide 1: 2024 Investor Day
2024 INVESTOR DAY DECEMBER 4, 2024 www.amcoastal.com
Slide 2: Forward-Looking Statements
Forward- Looking Statements American Coastal Insurance Corporation Statements made in this presentation that are not historical facts are “forward-looking statements”. The Company believes these statements are based on reasonable estimates, assumptions and plans. However, if the estimates, assumptio
Slide 3: Management
Management American Coastal Insurance Corporation Dan Peed Chairman & CEO Brad Martz President & Former CFO Chris Griffith COO & CIO 3
Slide 4: Management
Management American Coastal Insurance Corporation Brooke Adler General Counsel Svetlana Castle CFO Andy Gray Chief Compliance & Risk Officer 4
Slide 5: Corporate Overview
American Coastal Insurance Corporation® (ACIC) is a holding company that underwrites commercial residential property insurance policies in Florida through its wholly owned subsidiary, American Coastal Insurance Company (AmCoastal), founded in 2007. AmCoastal has the #1 market share in commercial res
Slide 6: Our P&C Carriers
Specialty Commercial Property Specialty Homeowners $636 M 2023 Continuing Operations Direct Premiums Written Our commercial lines business, underwritten by AmCoastal, continues to demonstrate its resilience by posting an underwriting profit for the 17th consecutive year since its formation in 2007.
Slide 7: Strategic Transformation
Strategic Transformation American Coastal Insurance Corporation Underwriting Initiatives Increased rates, began non-renewing risks, and reduced exposure by selling large portions of its personal lines business in seven states to a third- party carrier. Rebrand to American Coastal The Company began t
Slide 8: Investment Thesis
Investment Thesis American Coastal Insurance Corporation Deep Underwriting Expertise Sophisticated multi-model underwriting & best-in-industry data capture capabilities. 08 :0 0 Recently Completed Strategic Transformation A compelling investment opportunity in a unique niche market. Favorable Market
Slide 9: Profitability Metrics Reset in 2023
Profitability Metrics Reset in 2023 American Coastal Insurance Corporation PROFTABILITY HAS SHIFTED HIGHER IN THE RECENT HARD MARKET PROFITABLE EVERY YEAR SINCE INCEPTION Inclusive of all major hurricane losses *Reflects GAAP pre-tax income from American Costal Insurance Company 9 GAAP Pre-tax Incom
Slide 10: Exclusive Partnership
Exclusive Partnership American Coastal Insurance Corporation A Subsidiary of Truist Insurance Holdings 6th largest insurance Broker in the U.S. 7th largest insurance broker in the world Exclusive MGA Agreement for the Admitted Commercial Residential Condominium Association Market in Florida Distribu
Slide 11: Underwriting profitability is job #1
Underwriting profitability is job #1 Target risk is Florida low-rise, garden-style condo buildings Exposure managed via 3rd party catastrophe modeling software Maintain low net retention of catastrophe risk vs. expected annual earnings Aiming to achieve predictable risk and profitability of each pot
Slide 12: Underwriting Discipline
Underwriting Discipline American Coastal Insurance Corporation The Florida property insurance market has experienced several hard and soft market cycles since our inception in 2007. AmCoastal has a strong track record of taking appropriate underwriting action to ensure sustainability and profitabili
Slide 13: Favorable Underwriting Trends
Favorable Underwriting Trends American Coastal Insurance Corporation Hard Market Conditions Achieving record rate levels relative to total insured values along with higher deductibles. 13
Slide 14: Retention Trends
Retention Trends American Coastal Insurance Corporation At September 30, 2024, account retention was near our target of 85% and submission volume remains strong. 87.4% Premium Retention in 2023 81.3% Account Retention in 2023 14
Slide 15: Core CAT Reinsurance
Core CAT Reinsurance American Coastal Insurance Corporation Our core catastrophe reinsurance program provides protection against hurricanes and tropical storms, named or numbered by the National Hurricane Center, as part of our catastrophe management strategy, which is intended to provide our stockh
Slide 16: AOP CAT Reinsurance
AOP CAT Reinsurance American Coastal Insurance Corporation All other perils (AOP) catastrophe reinsurance provides protection from catastrophe loss events other than named windstorms such as hailstorms, tornados, and other severe convective storm events. $100 millionup to Effective Jan 1, 2024 – Dec
Slide 17: Excess Per Risk Reinsurance
Excess Per Risk Reinsurance American Coastal Insurance Corporation Our excess per risk reinsurance protection is designed to limit our losses from non-catastrophe perils including, but not limited to, fire, water damage (excluding flood), sinkhole, and collapse on a per building or per policy basis.
Slide 18: New Apartment Program
New Apartment Program American Coastal Insurance Corporation On October 27, 2024, we completed our first Citizens assumption, assuming 87 policies with approximately $10.7 million of expiring premium. This includes 14 apartment policies, kicking off our new apartment program. Similar to our Condo bo
Slide 19: Skyway Underwriters
Skyway Underwriters American Coastal Insurance Corporation In tandem with the launch of our apartment program, we’ve developed capabilities to underwrite and manage policies through our wholly- owned MGU, Skyway Underwriters. Skyway Underwriters licenses and completed development of a no- code polic
Slide 20: The Numbers
The Numbers Financial Results Profitability Select Balance Sheet Data 01. 02. 03. American Coastal Insurance Corporation 20
Slide 21: Consolidated Financial Results
Consolidated Financial Results American Coastal Insurance Corporation $ in millions, except per share data Three Months Ended Nine Months Ended September 30, 2024 2023 % Chg. 2024 2023 % Chg. Gross Premiums Written $93 $94 (1.0)% $507 $507 (0.1)% Gross Premiums Earned $160 $158 1.5% $476 $446 6.8% N
Slide 22: Combined Ratio and IIC Divestiture
57.7% Combined Ratio 41.9% Expense Ratio Q3’24 Combined Ratio American Coastal Insurance Corporation 15.8% 63.5% IIC Loss Ratio 35.8% IIC 99.3% IIC Executed definitive agreements to divest of Interboro Insurance Company and the Company anticipates closing in the first quarter of 2025. IIC is now inc
Slide 23: Select Balance Sheet Data
Select Balance Sheet Data American Coastal Insurance Corporation Improving Capitalization = Growth Opportunity We have resumed underwriting new commercial business after several years of shrinking due to capital constraints. $ in millions September 30, 2024 December 31, 2023 Total Investments $330 $
Slide 24: 2024 Guidance
2024 Guidance American Coastal Insurance Corporation As of November 6, 2024 ¹Estimates include net incurred losses of $16.2 million, net of tax impacts, from Hurricane Milton impacting current year earnings and approximately $5 million of additional ceded premiums earned impacting current year net p
Slide 25: 2025 Guidance
2025 Guidance American Coastal Insurance Corporation As of December 4, 2024 $70M to $90M (9.0)% to 16.1% Net Income from Continuing Operations1 vs. Est. $75M-$80M in FY2024 $290M to $320M +5.5% to +16.4% Net Premiums Earned1 vs. Est. $270M-$280M in FY2024 ¹Percent Change estimates based on midpoint
Slide 26: Capital Management: Debt, Equity, Dividends
Debt • In the long-term, we plan to target a 20% to 25% debt to total capital ratio. • We plan to reduce, but not fully eliminate our long-term debt upon maturity. Equity • When management believes ACIC stock is undervalued, we may participate in stock buybacks. • Where the Company determines pruden
Slide 27: Question & Answer
QUESTION & ANSWER 2024 INVESTOR DAY www.amcoastal.com
Slide 28: Contact Us
Contact Us American Coastal Insurance Corp. 570 Carillon Parkway, Suite 100 Saint Petersburg, FL 33716 Transfer Agent Equiniti Trust Company, LLC 48 Wall Street, Floor 23 New York, NY 10005 (800) 937 5449 helpast@equiniti.com American Coastal Insurance Corporation Investor Relations Mr. Alexander Ba
Slide 29: Definitions of Non-GAAP Measures
Definitions of Non-GAAP Measures The Company believes that investors' understanding of ACIC's performance is enhanced by the Company's disclosure of the following non-GAAP measures. The Company's methods for calculating these measures may differ from those used by other companies and therefore compa
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