Group 1 - American Coastal Insurance Corporation (ACIC) will release its financial results for Q4 and full year 2023 on February 29, 2024, after market close [1] - A quarterly conference call will be held at 5:00 p.m. ET on the same day, including live remarks and a Q&A session [1] - Interested participants should dial in 10 minutes prior to the start of the conference call [1] Group 2 - American Coastal Insurance Corporation is the holding company for American Coastal Insurance Company, which was established in 2007 to insure condominium and homeowner association properties in Florida [2] - The company has an exclusive partnership with AmRisc Group for the distribution of condominium association properties in Florida [2] - American Coastal Insurance Company has received a Financial Stability Rating of 'A, Exceptional' from Demotech [2]

Core Viewpoint - American Coastal Insurance Corporation has announced significant changes to its executive leadership team, aiming to enhance operations and shareholder value through new appointments and promotions [1][2]. Leadership Changes - Svetlana Castle has been appointed as the new Chief Financial Officer, effective January 22, 2024, bringing 15 years of insurance industry experience and various academic qualifications [2][3]. - B. Bradford Martz will transition from CFO to focus on his role as President, emphasizing strategic initiatives and investor relations [3]. - J. Andy Gray has been promoted to Chief Compliance and Risk Officer, a newly created position, to enhance accountability and oversight in compliance and risk management [4][5]. Company Background - American Coastal Insurance Corporation is a property and casualty insurance holding company, founded in 2007, specializing in insuring condominium and homeowner association properties in Florida [6]. - The company has a partnership with AmRisc Group for the distribution of condominium association properties and has received a Financial Stability Rating of 'A, Exceptional' from Demotech [6].

Earnings Presentation 3rd Quarter 2023 Company Overview ACIC is a specialty underwriter of catastrophe exposed property insurance. American Coastal Insurance Corp. (Nasdaq: ACIC) is the insurance ACIC as of September 30, 2023 holding company for two P&C carriers: American Coastal Total Assets: $1.15 billion Insurance Company (AmCoastal) and Interboro Insurance Company (IIC) along with other operating affiliates. Total Equity: $120.6 million AmCoastal has the #1 market share of commercial residential Annuali ...

Financial Performance - Gross premiums written for Q3 2023 were $103.872 million, a slight increase from $103.153 million in Q3 2022[195]. - Gross premiums earned for the nine months ended September 30, 2023, were $468.435 million, compared to $390.576 million for the same period in 2022, reflecting a 20% increase[195]. - Net income from continuing operations for Q3 2023 was $14.373 million, a significant recovery from a loss of $27.446 million in Q3 2022[195]. - Core income for the nine months ended September 30, 2023, was $71.767 million, compared to a loss of $27.731 million for the same period in 2022[195]. - Net income attributable to ACIC for the three months ended September 30, 2023, was $10.568 million, compared to a net loss of $70.884 million in the same period of 2022[197]. - Net earnings attributable to ACIC for the nine months ended September 30, 2023 increased by $468,712,000, or 270.8%, to net income of $295,627,000 from a net loss of $173,085,000 for the same period in 2022[261]. Policy and Operations - Policies in-force decreased by 92.3% from 302,296 at September 30, 2022, to 23,162 at September 30, 2023, primarily due to the receivership of the former subsidiary UPC[192]. - The company has ceased writing personal residential business in South Carolina and Texas since May 1, 2022, and has divested ownership of UPC[186]. - The total number of new and renewal policies decreased by 14,710 to 19,274 for the nine months ended September 30, 2023, compared to 33,984 for the same period in 2022[264]. - The total number of new and renewal policies in Florida decreased to 629 from 818 year-over-year, a decline of 189 policies[244]. Revenue and Expenses - Total revenue for the three months ended September 30, 2023, was $58.714 million, down from $72.752 million in the same period of 2022, representing a decrease of about 19.3%[197]. - Total expenses significantly decreased to $41.012 million for the three months ended September 30, 2023, from $100.235 million in the prior year, a reduction of approximately 59.1%[197]. - Expenses decreased by $59,223,000, or 59.1%, to $41,012,000 for the three months ended September 30, 2023, compared to $100,235,000 for the same period in 2022[236]. - Total operating expenses decreased by $14,924,000, or 13.2%, to $97,865,000 for the nine months ended September 30, 2023, from $112,789,000 for the same period in 2022[267]. Loss Ratios and Claims - The loss ratio, net, improved to 24.7% for the three months ended September 30, 2023, compared to 75.1% in the prior year, indicating a significant reduction in loss expenses[197]. - The combined ratio for the three months ended September 30, 2023, was 68.7%, a substantial improvement from 139.3% in the same period of 2022[197]. - The underlying combined ratio, excluding the effects of current year catastrophe losses, was 64.2% for the three months ended September 30, 2023, compared to 91.2% in the prior year[199]. - Net loss and LAE for the third quarter of 2023 was $13,764,000, a decrease of $39,001,000, or 73.9%, from $52,765,000 in the third quarter of 2022[237]. Reinsurance and Catastrophe Losses - A quota share reinsurance agreement was established with TypTap Insurance Company, ceding 100% of UPC's in-force policies in Georgia, North Carolina, and South Carolina[189]. - The company purchased catastrophe excess of loss reinsurance protection up to an exhaustion point of approximately $1,300 million for the 2023 hurricane season, effective June 1, 2023[213]. - The total incurred catastrophe losses for Q3 2023 amounted to $5,847,000, with a combined ratio impact of 10.5%, compared to $35,606,000 and 50.7% in Q3 2022[225]. - The company has approximately $508 million of occurrence limit remaining for Hurricane Ian, with an aggregate limit of approximately $980 million after reinstatement premiums[214]. Investment and Cash Flow - Cash, cash equivalents, restricted cash, and investment portfolio totaled $286.944 million at September 30, 2023, down from $340.905 million at December 31, 2022[208]. - The company reported net investment income of $2.709 million for the three months ended September 30, 2023, an increase from $2.236 million in the same period of 2022[197]. - During the nine months ended September 30, 2023, the company experienced cash outflows of $184,889,000, a significant increase from cash outflows of $27,048,000 during the same period in 2022[297]. - Net sales of investments during the nine months ended September 30, 2023, totaled $263,877,000, compared to $99,702,000 in the same period of 2022[298]. General and Administrative Expenses - General and administrative expenses fell by $9,828,000, or 61.6%, to $6,131,000 for the third quarter of 2023, largely due to a one-time goodwill impairment charge[240]. - General and administrative expenses decreased by $10,724,000, or 33.3%, to $21,507,000 for the nine months ended September 30, 2023, from $32,231,000 for the same period in 2022[269]. Company Outlook and Concerns - The company concluded that substantial doubt about its ability to continue as a going concern has been alleviated as of June 30, 2023[293]. - The company did not have any off-balance sheet arrangements or material changes to its contractual obligations at September 30, 2023[301].

Financial Data and Key Metrics Changes - The commercial lines segment now comprises over 90% of the third quarter gross written premium and 95% of the gross earned premium, with pretax income of $25.9 million in the third quarter and $90.2 million year-to-date [5] - Core income for the quarter was $14.9 million or $0.34 a share, an increase of nearly $33 million compared to a core loss of $18.1 million or $0.42 a share last year [10] - Net income from continuing operations improved to $14.4 million or $0.33 a share, approximately $42 million better than a net loss of $27.5 million or $0.64 a share in the same period last year [10] - The combined ratio for the third quarter improved over 70 points to 68.7% compared to last year [11] Business Line Data and Key Metrics Changes - The net loss ratio for commercial lines was 19.5% in the third quarter and 19.7% year-to-date, in line with expectations [6] - The commercial lines net expense ratio decreased to 33% in the third quarter and 35.6% year-to-date, down from 43% and 44.2% respectively last year [6] - The underlying combined ratio for the commercial segment was 48.9% in the third quarter and 54.3% year-to-date, down from 57.7% and 66.1% year-over-year [7] - Gross written premium for commercial lines increased by 22% through the third quarter and 31% year-to-date [8] Market Data and Key Metrics Changes - The total insured value for the commercial portfolio was down 14%, while the probable maximum loss at the 100-year return period decreased by 23% year-over-year [8] - Florida continues to be a hard market, with benefits from insurance reform leading to reduced litigation [8] Company Strategy and Development Direction - The company is divesting Interboro, its New York domiciled personal lines carrier, to focus on commercial lines [9] - The outlook for Florida's commercial marketplace remains unchanged, with expectations for a hard market in the near and intermediate terms [9] - The company launched an at-the-market common stock offering to raise between $10 million and $20 million to support exposure growth and optimize reinsurance spend [15] Management's Comments on Operating Environment and Future Outlook - Management noted that Hurricane Idalia had a minimal impact, with current loss estimates well below the reinsurance attachment point [6] - The company expects to continue benefiting from the hard market conditions in Florida, which are conducive to outsized returns on capital [15] Other Important Information - Stockholders' equity increased to $120.6 million or $2.78 a share, a 7.3% increase from the prior quarter [14] - Cash and invested assets totaled nearly $287 million, with total assets of approximately $1.15 billion [14] Q&A Session Summary Question: Current quota share agreements and potential for a captive MGA - Management indicated that they have two 20% quota shares and view them as instrumental in the current catastrophe reinsurance program, with plans to reduce these over time [19] - The company has a Class B reinsurer domiciled in Cayman and plans to utilize it more extensively going forward [20] Question: Current book value of Interboro - The current book value of Interboro is approximately $23 million [21] Question: Split between price and volume in the increase of gross written premiums - The volume is down about 13% to 14%, while the rate is up around 30% [25]

Financial Performance - Gross premiums written for Q2 2023 were $243.885 million, up from $207.632 million in Q2 2022, representing an increase of 17.4%[195] - Net premiums earned for Q2 2023 were $83.169 million, compared to $64.532 million in Q2 2022, reflecting a growth of 28.8%[195] - Total revenues for Q2 2023 reached $79.295 million, an increase from $63.910 million in Q2 2022, marking a rise of 24.0%[195] - Earnings from continuing operations for Q2 2023 were $20.352 million, a significant recovery from a loss of $13.311 million in Q2 2022[195] - Core income for Q2 2023 was $26.192 million, compared to a loss of $10.693 million in Q2 2022, indicating a turnaround in financial performance[195] - Net income from continuing operations for Q2 2023 was $20.352 million, a significant recovery from a loss of $13.311 million in Q2 2022[196] - Net earnings attributable to American Coastal Insurance Corporation for Q2 2023 increased by $86,808,000, or 125.8%, to $17,779,000 from a net loss of $69,029,000 in Q2 2022[231] - Net earnings for the six months ended June 30, 2023 increased by $387,260,000, or 378.9%, to $285,059,000 from a net loss of $102,201,000 for the same period in 2022[258] Premiums and Policies - The number of policies in-force decreased by 49.0%, from 46,401 at June 30, 2022, to 23,664 at June 30, 2023, due to the receivership of the former subsidiary UPC[192] - The company is seeking a buyer for Interboro Insurance Company (IIC) to exit the personal lines business, expecting the sale price to match the book value of the entity[193] - Gross written premiums rose by $36,253,000, or 17.5%, to $243,885,000 in Q2 2023 compared to $207,632,000 in Q2 2022, primarily driven by an increase in commercial premiums written[232] - Direct written premium by state for Florida increased by $57,578,000 to $236,766,000 in Q2 2023 from $179,188,000 in Q2 2022[233] - Total new and renewal policies decreased by 6,942, from 12,962 in June 2022 to 6,020 in June 2023[234] - Gross written premiums for the six months ended June 30, 2023 increased by $80,962,000, or 23.1%, to $431,008,000 from $350,046,000 in the same period in 2022[259] Expenses and Losses - Expenses increased by $7,043,000, or 13.5%, to $59,036,000 for the three months ended June 30, 2023, compared to $51,993,000 for the same period in 2022[235] - Loss and LAE increased by $6,883,000, or 49.1%, to $20,915,000 for the second quarter of 2023, with a net earned premium loss ratio of 25.1%, up 3.4 points from 21.7% in 2022[236] - Catastrophe losses incurred in Q2 2023 totaled $6,540,000, impacting the combined ratio by 7.9%, compared to a loss of $(2,113,000) and a combined ratio impact of (3.3)% in Q2 2022[223] - Unpaid losses and loss adjustment expenses (LAE) totaled $534,676,000 as of June 30, 2023, down from $842,958,000 as of December 31, 2022[227] - Loss and LAE for personal lines decreased by $1,168,000, or 20.0%, to $4,670,000 in Q2 2023 from $5,838,000 in Q2 2022[255] - Loss and LAE expenses decreased by $10,858,000, or 60.2%, to $7,181,000 for the six months ended June 30, 2023, compared to $18,039,000 for the same period in 2022[282] Investment and Cash Flow - Cash, cash equivalents, and investment portfolio totaled $241.714 million at June 30, 2023, down from $340.905 million at December 31, 2022[206] - The company reported net investment income of $2.692 million in Q2 2023, up from $1.839 million in Q2 2022, a growth of 46.5%[196] - Cash outflows from operating activities totaled $232,823,000 for the six months ended June 30, 2023, compared to cash inflows of $8,286,000 during the same period in 2022[292] - Net sales of investments amounted to $258,736,000 for the six months ended June 30, 2023, compared to $83,661,000 during the same period in 2022[293] Reinsurance and Ceding Ratios - The company entered into a quota share reinsurance agreement with TypTap Insurance Company, ceding 100% of UPC's in-force policies in Georgia, North Carolina, and South Carolina effective June 1, 2022[189] - The total ceding ratio for the three months ended June 30, 2023, was 47.4%, a decrease from 50.2% in the same period of 2022[216] - For personal lines, the total ceding ratio for the three months ended June 30, 2023, was 25.9%, compared to 19.6% in 2022[218] - Ceded premiums written for the three months ended June 30, 2023, totaled $339,004 million, up from $191,712 million in the same period of 2022[220] Segment Performance - Pretax earnings for the commercial lines segment increased by $6,595,000, or 35.1%, to $25,381,000 for the second quarter of 2023[239] - Gross written premiums for the commercial lines segment increased by $55,755,000, or 30.8%, to $236,822,000 for the second quarter of 2023[240] - Total expenses for the commercial lines segment increased by $12,233,000, or 38.6%, to $43,903,000 for the second quarter of 2023[244] - Pretax earnings for the personal lines operating segment improved by $11,839,000, or 78.5%, resulting in a pre-tax loss of $3,243,000 for the six months ended June 30, 2023, compared to a loss of $15,082,000 in the same period of 2022[276] - Gross written premiums for the personal lines segment decreased by $23,470,000, or 57.2%, to $17,545,000 for the six months ended June 30, 2023, down from $41,015,000 in the same period of 2022[277]

Investor Presentation Second Quarter 2023 Company Overview ACIC is a specialty underwriter of catastrophe exposed property insurance. American Coastal Insurance Corp. (Nasdaq: ACIC - effective ACIC as of June 30, 2023 8.15.2023) is the insurance holding company for two P&C Total Assets: $1.44 billion carriers: American Coastal Insurance Company (AmCoastal) and Interboro Insurance Company (IIC) along with other Total Equity: $106.5 million operating affiliates. Annualized Revenue: $339.2 million AmCoastal ha ...

Financial Data and Key Metrics Changes - The core income for Q2 2023 was $28.4 million or $0.65 per share, a 236% increase year-over-year from $8.5 million or $0.20 per share [12] - Net income from continuing operations was $22.6 million or $0.52 per share, compared to $5.8 million or $0.14 per share in the same period last year, driven by strong underwriting performance [12] - The combined ratio improved over 9 points to 67.7% compared to the previous year, fueled by a $36 million or 17% increase in premiums written year-over-year [13] Business Line Data and Key Metrics Changes - The commercial lines segment accounted for over 97% of the second quarter gross written premium and 92% of the gross earned premium [7] - Pretax income from the commercial lines segment was $25.4 million in Q2 and $64.3 million year-to-date, with a net loss ratio of 22.0% in Q2 [8] - The net combined ratio in the commercial lines segment was 59.4% in Q2, down from 61.5% year-over-year [8] Market Data and Key Metrics Changes - The total insured value exposure in the commercial lines portfolio decreased by 12.8%, while the probable maximum loss at the 100-year return period decreased by 21% year-over-year [9] - Gross written premium increased by 31% in Q2 and 33.8% year-to-date [9] Company Strategy and Development Direction - The company has transitioned to a commercial specialty insurance business and changed its name to American Coastal Insurance Corporation, effective August 15, 2023 [7] - The company expects the hard market in Florida to create opportunities, as it holds the 1 market share for admitted commercial residential exposure in the state [11] Management's Comments on Operating Environment and Future Outlook - Management believes legislative changes in Florida will mitigate excessive litigation issues and reduce loss costs and insurance rates over time [10] - The Florida residential cat market remains hard, and it will take time for reinsurers and investors to become comfortable with the exposures [11] Other Important Information - Stockholders' equity increased to $106.5 million or $2.45 per share, a 27% increase from the prior quarter [16] - Cash and invested assets totaled nearly $242 million, with total assets exceeding $1.44 billion [16] Q&A Session Summary - No questions were raised during the Q&A session, and the call concluded with management thanking employees and investors for their support [22][20]

Financial Performance - Gross premiums written for Q1 2023 were $187.123 million, an increase from $142.414 million in Q1 2022, representing a growth of 31.4%[181] - Net premiums earned in Q1 2023 were $87.324 million, compared to $57.746 million in Q1 2022, reflecting a growth of 51.3%[181] - Consolidated net income attributable to United Insurance Holdings Corp. for Q1 2023 was $260.878 million, a significant increase from a loss of $33.172 million in Q1 2022[181] - Earnings from continuing operations before income tax for Q1 2023 were $40.428 million, up from $5.627 million in Q1 2022[181] - Core income for Q1 2023 was $30.906 million, compared to $5.953 million in Q1 2022, indicating a growth of 418.5%[181] - Book value per share increased to $1.93 in Q1 2023, compared to a negative $4.21 in Q1 2022[181] - Total revenue decreased to $104,047,000 in Q1 2023 from $117,361,000 in Q1 2022, a decline of 11.3%[182] - Net income from continuing operations increased to $30,573,000 in Q1 2023, up from $4,647,000 in Q1 2022[182] - The combined ratio improved to 70.5% in Q1 2023 from 191.7% in Q1 2022, indicating enhanced operational efficiency[182] - The loss ratio, net, improved to 21.9% in Q1 2023 from 56.3% in Q1 2022, reflecting better loss management[182] - Net income attributable to United Insurance Holdings Corp. for Q1 2023 increased by $294,050,000, or 886.4%, to $260,878,000 from a net loss of $33,172,000 in Q1 2022[220] Policy and Operations - The number of policies in-force decreased by 51.3% from 48,152 at March 31, 2022, to 23,473 at March 31, 2023, due to the receivership of the former subsidiary UPC[178] - The company ceased writing commercial residential insurance in South Carolina and Texas effective May 1, 2022, and divested ownership of UPC on February 27, 2023[172][173] - A quota share reinsurance agreement was entered into with TypTap Insurance Company, ceding 100% of UPC's in-force policies in Georgia, North Carolina, and South Carolina effective June 1, 2022[175] - The company has historically grown through strategic acquisitions, including the merger of Journey Insurance Company into American Coastal Insurance Company effective June 1, 2022[178] - Gross written premiums for personal lines decreased by $3,968,000, or 27.5%, to $10,482,000 for Q1 2023 from $14,450,000 in Q1 2022[231] - Gross written premiums for commercial lines increased by $48,677,000, or 38.0%, to $176,641,000 in Q1 2023 from $127,964,000 in Q1 2022[241] Expenses and Cost Management - Total expenses significantly reduced to $64,207,000 in Q1 2023 compared to $113,067,000 in Q1 2022, a decrease of 43.2%[182] - Loss and LAE decreased by $13,445,000, or 41.3%, to $19,073,000 in Q1 2023, with the loss ratio as a percentage of net earned premiums dropping to 21.9% from 56.3% in Q1 2022[227] - Policy acquisition costs fell by $25,225,000, or 48.4%, to $26,927,000 in Q1 2023, primarily due to decreases in agent commissions and policy administration fees[228] - General and administrative expenses decreased by $5,598,000, or 36.3%, to $9,837,000 in Q1 2023, driven by a reduction in salary-related expenses due to decreased headcount[229] - Total operating expenses rose by $7,909,000, or 39.3%, to $28,016,000 for Q1 2023 compared to $20,107,000 in Q1 2022[247] Reinsurance and Catastrophe Management - The company purchased catastrophe excess of loss reinsurance protection up to an exhaustion point of approximately $2,500,000,000 for the 2022 hurricane season[198] - After Hurricane Ian, the company has approximately $993 million of aggregate limit remaining, with reinstatement premiums of approximately $15.4 million[199] - The company agreed to terminate a reinsurance agreement resulting in approximately $1,300,000 of ceded premium savings[200] - Reinsurance costs as a percentage of gross earned premium decreased from 53.0% in 2022 to 39.6% in 2023[203] - The exhaustion point of the company's catastrophe reinsurance program is approximately $200,000,000 with a retention of $3,000,000 per occurrence[198] - Unpaid losses and LAE decreased from $842,958,000 as of December 31, 2022 to $748,365,000 as of March 31, 2023, primarily due to ongoing claims settlements related to Hurricane Ian[215] - The company incurred $3,071,000 in catastrophe losses for the three months ended March 31, 2023, with a combined ratio impact of 3.5%[210] Investment and Market Conditions - Cash, cash equivalents, and restricted cash totaled $372,721,000 as of March 31, 2023, up from $340,905,000 at December 31, 2022[193] - The Federal Reserve's interest rate hikes may negatively impact the market value of the company's investment portfolio and rate of return on investments[218] - Net purchases of investments totaled $195,082,000 in Q1 2023, compared to net sales of $70,134,000 in Q1 2022[258] Future Outlook and Concerns - The company has substantial doubt about its ability to continue as a going concern within the next twelve months[253] - Management plans to explore raising additional capital for UIHC and ACIC to strengthen statutory risk-based capital if necessary[253]

Financial Data and Key Metrics Changes - For Q1 2023, the company reported a GAAP net income of $260.9 million or $5.99 per share, compared to a net loss of $33.2 million or $0.77 per share in the previous year, which included a non-recurring gain from discontinued operations of $230.3 million or $5.29 per share [13][14] - Continuing operations pretax income was approximately $40 million, a significant increase from $5.6 million year-over-year, representing a 619% increase [10][14] - The combined ratio improved to 70.5%, down from over 191% last year, indicating a substantial enhancement in operational efficiency [15] Business Line Data and Key Metrics Changes - The commercial lines segment generated a pretax income of approximately $39 million, with gross written premiums up 38% year-over-year and a net loss ratio of 22% [10][16] - The personal lines segment reported a pretax profit of $4.6 million, but was impacted by a $3.2 million pretax loss primarily related to interest expense [16] Market Data and Key Metrics Changes - The company noted that legislative changes in Florida are expected to reduce loss rates by approximately 25%, which may positively impact insurance premium rates over time [9] - The Florida residential cat market remains extremely hard, with expectations for continued challenges in reinsurance placements, but also opportunities for growth in commercial residential exposure [12] Company Strategy and Development Direction - The company is focused on exiting the personal lines business and enhancing its commercial lines segment, which is expected to drive future growth [7][10] - Management is optimistic about the potential for improved financial performance in 2023, following significant restructuring efforts [21] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the company's ability to demonstrate significant improvements in financial performance during the remainder of 2023 [21] - The company is working closely with the Florida Department of Financial Services to resolve outstanding balances and leverage net operating loss carryforwards from UPC [18] Other Important Information - As of March 31, 2023, stockholders' equity was $83.5 million, with total assets exceeding $1.44 billion, including over $792 million of reinsurance recoverable [17] - The company has secured over 100% of the limit authorized for its core cat reinsurance program, providing substantial hurricane protection [11][19] Q&A Session Summary - The Q&A session included inquiries about the impact of legislative changes on loss ratios and premium rates, to which management responded positively, indicating expected reductions in loss costs over time [9] - Questions regarding the company's strategy for personal lines and the expected timeline for financial recovery were addressed, with management emphasizing the focus on commercial lines and ongoing restructuring efforts [7][21]