Proassurance Corporation · NYSE:PRA
Proassurance — Q2 2023 Earnings Presentation
30 slides from Proassurance's earnings presentation, Aug 14, 2023
Slide 1: Second Quarter 2023
Second Quarter 2023 August 2023
Slide 2: Overview
ProAssurance Overview
Slide 3: Mission, Vision, & Values
ProAssurance Investor Briefing | August 2023 3 Mission, Vision, & Values The ProAssurance Mission We Protect Others. Corporate Values Integrity | Leadership | Relationships | Enthusiasm Our Brand Promise We will honor these values in the execution of treated fairly to perform our mission and realize
Slide 4: At a Glance
ProAssurance Investor Briefing | August 2023 4 At a Glance All employee and financial data as of 06/30/23. Lines of BusinessEmployeesPrincipal OfficesBusiness Unit Healthcare professional liability6098HCPL Medical technology liability341Medmarc Podiatrists, chiropractors, dentists, and lawyers1021Sm
Slide 5: ProAssurance Executive Leadership
ProAssurance Investor Briefing | August 2023 5 ProAssurance Executive Leadership Ned Rand - President & Chief Executive Officer Mr. Rand became President and CEO in 2019, after serving as COO, CFO, Executive VP, and Senior VP of Finance at ProAssurance since joining the company in 2004. Prior to joi
Slide 6: ProAssurance Board of Directors
ProAssurance Investor Briefing | August 2023 6 ProAssurance Board of Directors Director bios available on our website at Investor.ProAssurance.com/OD Maye Head Frei C M. James Gorrie N/C Ziad R. Haydar, MD C Edward L. Rand, Jr E Frank A. Spinosa, DPM N/C Katisha T. Vance, MD N/C A - Audit Committee
Slide 7: ProAssurance Brand Profile
ProAssurance Investor Briefing | August 2023 7 ProAssurance Brand Profile Specialty P&C Healthcare Professional Liability Workers’ Comp Alternative Risk Transfer Medical Technology & Life Sciences Products Liability Legal Professional Liability
Slide 8: ProAssurance Specialty P&C, Eastern Alliance and Inova Re
ProAssurance Investor Briefing | August 2023 8 • Healthcare Professional Liability (HCPL) insures healthcare providers and facilities, including E&S coverages • The Small Business Unit insures podiatrists, chiropractors, dentists, and lawyers • Medmarc insures medical technology and life sciences co
Slide 9: ProAssurance Specialty Property & Casualty
ProAssurance Investor Briefing | August 2023 9 ProAssurance Specialty Property & Casualty Specialty Healthcare Life SciencesSmall Business Unit Standard Physicians Healthcare Professional Liability Insurance $44M$100M$417M $211M Gross Premiums Written Last 12 months $820M Specialty Property & Casual
Slide 10: Workers' Compensation Insurance
ProAssurance Investor Briefing | August 2023 10 Disciplined individual account underwriting with focus on rate adequacy in rural territories • Guaranteed Cost Policies • Loss-Sensitive Dividend Plans • Deductible Plans • Retrospective Rating Plans • ParallelPay–“Pay as you Go” • Specialty Risk (high
Slide 11: Segregated Portfolio Cell Reinsurance
ProAssurance Investor Briefing | August 2023 11 Segregated Portfolio Cell Reinsurance ProAssurance Fronting Arrangement Agency Group or Association establishes a cell Underwriting Claims Administration Risk Management Reinsurance Audit Asset Management Services + Cell Rental Fees + Participation in
Slide 12: Financial Ratings & Balance Sheet Highlights
ProAssurance Investor Briefing | August 2023 12 • ProAssurance is recognized for our financial strength by top rating agencies • We maintain a balance sheet that ensures stability and security for our customers • Our conservative reserving philosophy enables success over the insurance cycles Financi
Slide 13: ProAssurance Leverage Update
ProAssurance Investor Briefing | August 2023 13 • $428M total debt principal at 06/30/2023 o $178M of Contribution Certificates from NORCAL acquisition o $250M 5.3% 10-year notes due 11/15/2023 • $250M revolving credit facility, $50M "accordion" option, no outstanding borrowing • In April 2023, ProA
Slide 14: Success in Competitive Markets
Success in Competitive Markets
Slide 15: A Foundation in Excellence
ProAssurance Investor Briefing | August 2023 15 A Foundation in Excellence “From our earliest days, we have operated with a strategy both responsive to near-term challenges and proactive to long-term opportunity.” -Ned Rand President & CEO Superior brand identity and reputation in the market Special
Slide 16: Executing our Strategy: 2022 Accomplishments
ProAssurance Investor Briefing | August 2023 16 Ex ec ut in g ou r S tr at eg y Enterprise-Wide Safely and successfully re-opened offices after 2 years of primarily remote work AM Best and Fitch ratings moved to Stable outlook in 2022 Specialty Property & Casualty Achieved renewal rate increas
Slide 17: Goals / Initiatives
ProAssurance Investor Briefing | August 2023 17 20 23 G oa ls / I ni tia tiv es SP&C Innovation and Operational Excellence Launch a state-of-the-art workflow solution across the segment Build out data science and predictive analytics strategy Develop and launch a next generation online portal
Slide 18: Appendix
Appendix
Slide 19: Income Statement Highlights (6/30/23)
ProAssurance Investor Briefing | August 2023 19 Income Statement Highlights (6/30/23) Six Months EndedThree Months Ended June 30 2022202320222023 $ 571.1$ 553.7$ 235.5$ 237.9Gross Premiums Written $ 513.0$ 487.6$ 247.3$ 247.9Net Premiums Earned $ 55.2$ 67.5$ 27.1$ 38.3Net Investment Result $ (37.4)$
Slide 20: Specialty P&C Financial Highlights (6/30/23)
ProAssurance Investor Briefing | August 2023 20 85.0 %86.0 %84.1 %84.7 %Current Accident Year Net Loss Ratio (5.6%)0.3%(9.5%)(3.6%)Effect of Prior Accident Year Reserve Development 79.4 %86.3 %74.6 %81.1 %Net Loss Ratio 23.8 %24.7 %26.2 %26.5 %Underwriting Expense Ratio 103.2 %111.0 %100.8 %107.6 %C
Slide 21: Workers' Compensation Insurance Financial Highlights
ProAssurance Investor Briefing | August 2023 21 Workers’ Compensation Insurance Financial Highlights (6/30/23) Six Months EndedThree Months Ended June 30 2022202320222023 $ 135.8$ 136.2$ 63.6$ 62.8Gross Premiums Written $ 82.4$ 81.8$ 41.7$ 41.0Net Premiums Earned $ 83.6$ 83.1$ 42.2$ 41.7Total Revenu
Slide 22: Segregated Portfolio Cell Reinsurance Financial Highlights
ProAssurance Investor Briefing | August 2023 22 Segregated Portfolio Cell Reinsurance Financial Highlights (6/30/23) Six Months EndedThree Months Ended June 30 2022202320222023 $ 45,003$ 47,994$ 16,634$ 25,113Gross Premiums Written $ 35,536$ 39,394$ 16,222$ 24,094Net Premiums Earned 3231,024211603Ne
Slide 23: Lloyd's Syndicates Financial Highlights (6/30/23)
ProAssurance Investor Briefing | August 2023 23 Lloyd’s Syndicates Financial Highlights (6/30/23) Six Months EndedThree Months Ended June 30 2022202320222023 $ 9.9$ 8.5$ 4.1$ 5.0Gross Premiums Written $ 13.5$ 8.2$ 5.8$ 3.8Net Premiums Earned $ 13.3$ 8.5$ 5.6$ 4.0Total Revenues $ (8.2)$ (4.4)$ (3.4)$
Slide 24: Corporate Financial Highlights (6/30/23)
ProAssurance Investor Briefing | August 2023 24 Corporate Financial Highlights (6/30/23) Six Months EndedThree Months Ended June 30 2022202320222023 $ 41.7$ 60.6$ 21.6$ 30.9Net investment income $ 12.8$ 5.5$ 5.2$ 6.6Equity in earnings (loss) of unconsolidated subsidiaries $ (33.0)$ 0.5$ (20.6)$ (0.3
Slide 25: YTD 2023 Net Investment Result and Equity Rollforward
ProAssurance Investor Briefing | August 2023 25 YTD 2023 Net Investment Result and Equity Rollforward Data shown in thousands 2023 $1,104,018Beginning Equity (19,971)Common Shares Required 2,788Employee Stock Transactions 4,453Earnings (2,701)Dividends 31,127OCI $1,119,714Total Equity Change6/30/202
Slide 26: Lloyd's of London Syndicates
ProAssurance Investor Briefing | August 2023 26 Lloyd’s of London Syndicates ProAssurance Funds at Lloyd’s (FAL) $19.3 Million 1 Property Insurance (All Other - Mainly US) 28% Casualty (Mainly US) 28% Catastrophe Reinsurance (Excess of Loss) 15% Specialty 8% Facility (US) 6% General Liability (US) 4
Slide 27: Investment Philosophy & Portfolio
ProAssurance Investor Briefing | August 2023 27 Investment Philosophy & Portfolio Total Investments $4.32 Billion 03/31/2023 Subject to rounding Details of our investment portfolio are available on our website at https://investor.proassurance.com/financial-information/quarterly-investment-supplement
Slide 28: Combined Tax Credits Portfolio Detail & Projections
ProAssurance Investor Briefing | August 2023 28 Combined Tax Credits Portfolio Detail & Projections The total credits column represents our current estimated schedule of tax credits that we expect to receive from our tax credit partnerships. The actual amounts of credits provided by the tax credit p
Slide 29: Forward Looking Statements Non-GAAP Measures
ProAssurance Investor Briefing | August 2023 29 Forward Looking Statements Non-GAAP Measures This presentation contains Forward Looking Statements and other information designed to convey our projections and expectations regarding future results. There are a number of factors which could cause our a
Slide 30: Mailing address and contact
© ProAssurance Corporation. All rights reserved. MAILING ADDRESS: ProAssurance Corporation 100 Brookwood Place Birmingham, AL 35209 CONTACT: Dana Hendricks EVP, Chief Financial Officer 205.877.4462 DanaHendricks@ProAssurance.com