Donegal Group Inc. Q4 FY2024 earnings call

• Kevin Burke: Highlighted highest quarterly earnings, core loss ratio improvement from underwriting actions, systems modernization progress with major software releases, and confidence in sustained financial performance.
• Jeffrey D. Miller: Reviewed fourth quarter and full year financial results, combined ratio improvement, and reinsurance renewal for 2025, including changes in property catastrophe reinsurance coverage.
• Jeffrey T. Hay: Commercial lines growth with exit from certain states, underwriting initiatives (appetite guide, small business initiatives, underwriting discipline measures), and personal lines reduction with plan to stabilize and grow measuredly.
• W. Dan DeLamater: Operational initiatives including consolidated regional structure, expense reduction efforts (achieved 1 percentage point reduction in expense ratio for 2024), and monitoring of weather and inflation risks.
• V. Anthony Viozzi: Investment performance with net investment income growth, portfolio adjustments to higher-spread products, and equity holdings increase.

Fourth Quarter 2024: Net premiums earned increased 4.6% to $236.6 million. Net premiums written decreased by 0.6%, with a 5% decrease in personal lines premiums offset partially by 2.8% growth in commercial lines. The combined ratio for the fourth quarter was 92.9%, with core loss ratio improving 9.5 percentage points. Commercial lines net premiums written grew 2.8% in the quarter, with a statutory combined ratio of 97.3% (improved 8.5 points from prior-year quarter). Personal lines net premiums written decreased 5% in the quarter, with a statutory combined ratio of 89.5% (improved from 111.1% prior-year quarter). Full Year 2024: Net premiums written for commercial lines grew 3.7%, personal lines 7.4% (driven by rate increases). Combined ratio for 2024 was 98.6%, a significant improvement from 104.4% in 2023. Commercial lines full-year statutory combined ratio was 98.2%, personal lines 89.5%.

• 2025 business plan includes high-single-digit percentage growth in commercial lines targeting profitable accounts, modest decline in personal lines with plan to stabilize premium writings.
• Expect further efficiency gains from technology investments, including cloud-based data infrastructure.
• Completion of major systems transformation project by 2027, decommissioning legacy systems.

• Weather-related losses could impact results.
• Social inflation trends affecting loss severity in certain lines.
• Reinsurance cost changes and market volatility.
• Industry-specific inflation and litigation trends varying by jurisdiction.

Q: Are there additional questions?

A: While questions were requested in advance, answers were worked into prepared remarks, and no additional questions were posed as of closing