Hippo Holdings Inc. Q4 FY2025 earnings call

Strategic pillars: Strategic diversification (broaden premium base across personal and commercial lines), Unlocking market growth (differentiated technology-driven customer experience), Optimize for risk management (leverage diversified portfolio and risk management capabilities). Homeowners update: Prioritized profitability over growth in 2025, achieved average renewal premium increase of approx 15% in HHIP business, expect return to growth in 2026 with Baldwin partnership and relaunch of traditional new policies. Renters update: Grew 19% year over year, one of most seasoned programs. Commercial lines update: Rigorous diligence process for program partners, 54% gross loss ratio in 2025 including impact of California wildfires, engaged with program partners in underwriting and claims, place underperforming programs into runoff

Homeowners: In 2025, wrote $379 million of gross written premium, down approximately 10% from prior year, accounted for 34% of 2025 gross written premium; expect to return to growth in 2026. Renters: Produced $175 million of gross written premium for the year, a 19% increase year over year. Commercial lines: Commercial multi-peril increased 75% over 2024 to $265 million of gross written premium; casualty business increased 92% to end the year with $264 million of gross written premium

2026 gross written premium expected to grow between 27%-36% to $1.4 billion to $1.5 billion; net written premium expected to grow between 19%-28% to $500 million to $540 million; net combined ratio expected to improve between eight and ten percentage points to 103% to 105%; adjusted net income expected between $45 million and $55 million

Refers to need to refer to Hippo Holdings Inc.'s SEC filings for risks, uncertainties, and other factors

Q: Just about the relaunch of the homeowners book outside of builders. Could you talk a little bit about your go-to-market strategy and maybe comment on what the competitive environment looks like there as you are looking to increase the distribution?

A: Rick McCathron mentioned spent two years retooling the product line, taken rate, improved terms and conditions, opening in states with strategic partners, accelerating throughout the year, expanding partnership roster.

Q: Looking at another line of business here, the casualty side, you have seen some nice growth there, both on a gross basis and retaining a bit more through a net basis. Can you unpack a little bit as to what sort of business actually underlies that casualty business? What is the tail risk there? And then can you talk about your maybe timeline to continue to increase retention there?

A: Rick McCathron said predominantly combined as some cyber insurance, some commercial GL, predominantly for small business, construction projects, some commercial auto, average exposure per account $300,000, time to settle claims two years or less, expect to increase retention over 2026 and beyond in a partner-by-partner selective way.

Q: Just curious if you could discuss what drove the reserve development in the quarter?

A: Guy Zeltser said mostly driven by one large loss in homeowners, full-year release about $10 million, Q4 cat loss ratio improved seven percentage points to negative 1%, non-cat loss ratio improved five percentage points year over year to 47%.

Q: Maybe you could just discuss how you are expecting the premium increases in homeowners to trend moving forward relative to the 15% in 2025?

A: Guy Zeltser said not expecting another year of 15%, but will still go up as catching up with inflation, expect premium change increase in 2026 to continue ahead of loss costs; Rick McCathron added only writing business where expect loss ratio to be profitable so partners won't see quotes for unexcited business