United Fire Group, Inc · NASDAQ:UFCS
United Fire — Q1 2023 Earnings Presentation
9 slides from United Fire's earnings presentation, May 9, 2023
Slide 1: First Quarter 2023 Results
FIRST QUARTER 2023 RESULTS MAY 9, 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: First quarter 2023
Highlights First quarter 2023 ▪ Net income of $0.7 million ▪ Net premiums written(1) of $273.3 million increased 13.4% compared to the first quarter of 2022 ▪ Four consecutive quarters of total net written premium growth with core commercial lines now also contributing to enterprise growth ▪ GAAP co
Slide 4: Consolidated financial results
Financial results Consolidated financial results ▪ Net written premium growth of +13% with core commercial lines growth of +10% ▪ Q1 2023 combined ratio of 104% driven by – Increased underlying loss ratio – Catastrophe losses in line with 5-year historic mean – Neutral prior period loss reserves – S
Slide 5: P&C results
P&C results Results ▪ Four consecutive quarters of total net written premium growth ▪ Increased underlying loss ratio driven by: – Shift in assumed reinsurance accident year loss ratio assumptions – Loss trends recognized in late 2022 – Increased ceded reinsurance costs and retentions ▪ Catastrophe
Slide 6: P&C Portfolio production
P&C Portfolio production Net written premium ($M) Core Commercial Specialty Surety Alternative Distribution $273 ▪ Core commercial lines now contributing to written premium growth $261 $241 $247 $235 with continued growth in other businesses $50 $38 $45 $12 $53 $55 $15 – Core commercial growth suppo
Slide 7: Core Commercial lines production detail
Core Commercial lines production detail New business & premium retention trend New Business ($M) Premium Retention ▪ Core commercial new business continues to increase 81% 85% – Line of business mix consistent with expectations 80% – New business mix diversified and leverages cross-functional streng
Slide 8: Investment portfolio composition & quality
Investment portfolio Investment portfolio composition & quality Portfolio Composition Fixed Maturity Credit Rating ▪ Q1 invested assets of $1.9B, with 85% of assets in fixed Equity Rating % of Portfolio income securities 8% Other & Long- AAA 35% Term Partnerships 7% AA 31% ▪ High-quality portfolio w
Slide 9: Investment income results
Investment income Results ▪ Net investment income increased 13% vs. prior year as increasing fixed maturity yields sustainably improve earnings ▪ Fixed maturity new money yields increased to 5.3% from 3.1% in Q1 2022 ▪ Net investment loss driven by UFG’s income-focused equity portfolio valuation tha