United Fire Group, Inc · NASDAQ:UFCS
United Fire — Q2 2023 Earnings Presentation
9 slides from United Fire's earnings presentation, Aug 8, 2023
Slide 1: Second Quarter 2023 Results
SECOND QUARTER 2023 RESULTS AUGUST 8, 2023
Slide 2: Safe harbor statement and non-GAAP measures
Safe harbor statement and non-GAAP measures This presentation may contain forward-looking statements about our operations, anticipated performance and other similar matters. The Private Securities Litigation Reform Act of 1995 provides a safe harbor under the Securities Act of 1933 and the Securitie
Slide 3: Highlights: Second quarter 2023
Highlights Second quarter 2023 ▪ Net loss of $56.4 million driven by prior period loss reserve strengthening and elevated catastrophe losses ▪ Net premiums written(1) of $299.1 million increased 14.6% compared to the second quarter of 2022 ▪ Five consecutive quarters of total net written premium gro
Slide 4: Consolidated financial results
Financial results Consolidated financial results ▪ Net written premium growth continues in Q2, +15% vs. prior year ▪ Q2 2023 combined ratio of 133% driven by – Strengthening of prior period loss reserves – Underlying loss ratio reflects increased surety losses of 3 points – Catastrophe losses 2 poin
Slide 5: P&C results
P&C results Results ▪ Five consecutive quarters of year-over-year net written premium growth ▪ Q2 Underlying loss ratio includes 3 points of impact from a small number of large surety losses ▪ Q2 Catastrophe losses approximately 2 points above 5-year historic mean ▪ Expense ratio benefitting from ac
Slide 6: P&C Portfolio production
P&C Portfolio production Net written premium ($M) $400,000 Core Commercial Specialty Surety Alternative Distribution ▪ Diversifying growth across business portfolio $299 $300,000 $261 $273 – Second consecutive quarter of core commercial growth with all production $241 $247 $235 $50 $67 metrics impro
Slide 7: Core Commercial lines production detail
Core Commercial lines production detail New business & premium retention trend New Business ($M) Premium Retention ▪ New business continues to increase $60 84% 90% – Line of business mix consistent with expectations 81% – New business leverages cross-functional strengths 77% 76% $40 76% 74% 80% – Go
Slide 8: Investment portfolio composition & quality
Investment portfolio Investment portfolio composition & quality Portfolio Composition Fixed Maturity Credit Rating ▪ Q2 invested assets of $1.8B, with 85% of assets in fixed Equity Rating % of Portfolio income securities 7% Other & Long- AAA 35% Term Partnerships 7% AA 30% ▪ High-quality portfolio w
Slide 9: Investment income
Investment income Results ▪ Q2 Net investment income increased vs. prior year as increasing fixed maturity yields sustainably improve earnings – Q2 +23% vs. prior year – YTD +18% vs. prior year ▪ Fixed maturity new money yields increased to 5.1% from 4.1% in Q2 2022 ▪ LP valuation change of ($3.7M)