Workflow
United Insurance(ACIC) - 2022 Q3 - Quarterly Report
ACICUnited Insurance(ACIC)2022-11-09 22:17
Transcript
Slide

Financial Performance - Gross premiums written for Q3 2022 were 255.2million,adecreaseof20.8255.2 million, a decrease of 20.8% from 322.5 million in Q3 2021[159]. - Net premiums earned for Q3 2022 were 116.2million,down24.2116.2 million, down 24.2% from 153.3 million in Q3 2021[159]. - Total revenues for Q3 2022 were 123.8million,adeclineof24123.8 million, a decline of 24% compared to 162.7 million in Q3 2021[159]. - Consolidated net loss attributable to United Insurance Holdings Corp. for Q3 2022 was (70.9)million,comparedtoanetlossof(70.9) million, compared to a net loss of (14.3) million in Q3 2021[159]. - The combined ratio for the three months ended September 30, 2022, was 165.4%, significantly higher than 116.9% for the same period in 2021[1]. - Net losses attributable to United Insurance Holdings Corp. for Q3 2022 increased by 56,562,000,or394.956,562,000, or 394.9%, resulting in a net loss of 70,884,000 compared to a net loss of 14,322,000inQ32021[198].−Grosswrittenpremiumsdecreasedby14,322,000 in Q3 2021[198]. - Gross written premiums decreased by 67,290,000, or 20.9%, to 255,203,000inQ32022from255,203,000 in Q3 2022 from 322,493,000 in Q3 2021, primarily due to the transition of the Northeast business to HCPCI[199]. Policy and Operations - Policies in-force decreased by 42.5% from 525,969 at September 30, 2021, to 302,296 at September 30, 2022[154]. - New and renewal policies in Florida dropped by 19,614 to 35,310 in Q3 2022 compared to 54,924 in Q3 2021, reflecting a total decline of 66,524 policies across all regions[201]. - Total new and renewal homeowner and dwelling fire policies decreased by 66,337, or 49.1%, to 68,858 for the three months ended September 30, 2022, compared to 135,195 for the same period in 2021[212]. - The company announced plans for withdrawal from Florida, Louisiana, Texas, and New York, leading to an orderly run-off of personal lines policies[148]. Expenses and Losses - Total expenses for Q3 2022 increased by 13,129,000,or7.213,129,000, or 7.2%, to 194,570,000 from 181,441,000inQ32021,drivenbyhigherlossandLAEexpenses[202].−LossesandlossadjustmentexpensesforthethreemonthsendedSeptember30,2022,were181,441,000 in Q3 2021, driven by higher loss and LAE expenses[202]. - Losses and loss adjustment expenses for the three months ended September 30, 2022, were 117.2 million, an increase of 14.0% from 102.8millionforthesameperiodin2021[1].−LossandLAEexpensesroseby102.8 million for the same period in 2021[1]. - Loss and LAE expenses rose by 14,459,000, or 14.1%, to 117,228,000inQ32022,withthelossratioasapercentageofnetearnedpremiumsincreasingby33.8pointsto100.9117,228,000 in Q3 2022, with the loss ratio as a percentage of net earned premiums increasing by 33.8 points to 100.9%[204]. - General and administrative expenses surged by 12,451,000, or 89.3%, to 26,391,000inQ32022,largelyduetoagoodwillimpairmentof26,391,000 in Q3 2022, largely due to a goodwill impairment of 13,569,000[208]. Reinsurance and Catastrophe Losses - The company entered into a quota share reinsurance agreement ceding 100% of policies in Georgia, North Carolina, and South Carolina effective June 1, 2022[150]. - The company's reinsurance program for the 2022 hurricane season included catastrophe excess of loss reinsurance protection up to 2,500,000million[177].−AfterHurricaneIan,thecompanyretainedanadditionallossof2,500,000 million[177]. - After Hurricane Ian, the company retained an additional loss of 20,100 million, with approximately 891millionofoccurrencelimitremainingforIan[178].−ThetotalincurredcatastrophelossesforthethreemonthsendedSeptember30,2022,amountedto891 million of occurrence limit remaining for Ian[178]. - The total incurred catastrophe losses for the three months ended September 30, 2022, amounted to 37,440,000, with a combined ratio impact of 32.2%, compared to 37,003,000and24.137,003,000 and 24.1% in 2021[188]. Investment and Market Risks - Cash, cash equivalents, restricted cash, and investment portfolio totaled 768.6 million at September 30, 2022, down from 964.8millionatDecember31,2021[1].−TheFederalReserve′sinterestratehikesmaynegativelyaffectthemarketvalueofthecompany′sinvestmentportfolio[196].−Thecompanyisexposedtomarketrisks,includinginterestraterisk,creditrisk,andequitypricerisk[285].−NomaterialchangesinmarketriskwerereportedduringtheninemonthsendedSeptember30,2022[285].SegmentPerformance−Grosswrittenpremiumsforthepersonallinesoperatingsegmentdecreasedby964.8 million at December 31, 2021[1]. - The Federal Reserve's interest rate hikes may negatively affect the market value of the company's investment portfolio[196]. - The company is exposed to market risks, including interest rate risk, credit risk, and equity price risk[285]. - No material changes in market risk were reported during the nine months ended September 30, 2022[285]. Segment Performance - Gross written premiums for the personal lines operating segment decreased by 79,773,000, or 30.9%, to 178,336,000inQ32022from178,336,000 in Q3 2022 from 258,109,000 in Q3 2021[210]. - Pre-tax earnings for the commercial lines operating segment decreased by 8,434,000,or82.78,434,000, or 82.7%, to 1,762,000 for the three months ended September 30, 2022, from 10,196,000forthesameperiodin2021[220].−Grosswrittenpremiumsforthecommerciallinessegmentincreasedby10,196,000 for the same period in 2021[220]. - Gross written premiums for the commercial lines segment increased by 12,483,000, or 19.4%, to 76,867,000forthethirdquarterendedSeptember30,2022,from76,867,000 for the third quarter ended September 30, 2022, from 64,384,000 for the same period in 2021[221]. - Loss and LAE attributable to the personal lines segment decreased by 54,151,000or18.354,151,000 or 18.3%, to 242,133,000 for the nine months ended September 30, 2022, compared to $296,284,000 in 2021[251].