Presurance Holdings, Inc. Q3 FY2023 earnings call

• Impacted by recent storm activity, especially convective storms in Oklahoma affecting the personalized book of business.
• Focus on organic growth in historically profitable core business and select key specialty verticals.
• Gross written premiums up 17% in the third quarter and year-to-date.
• Expense ratio improved to 34% in the third quarter, showing continuous expense reduction efforts.
• Select key verticals saw continued growth before storm activity in the period.

Gross written premiums were up roughly 17% in the third quarter to just under $39 million. Commercial Lines accounted for roughly 75% of total gross written premium, with production up 3% to $28 million. Personal Lines stood at just over 25% of total gross written premium, with low-value home and dwelling insurance products driving it to $10 million.

• Near-term dip in premiums expected due to the Core Specialty transaction, but growth in other areas will offset the decline.
• Expect improved combined ratios going forward as storm-related losses clear, reflecting the strong foundation of the book.

• Storm activity, including convective storms, significantly impacted loss ratios and financials.
• High acquisition costs and limits profiles of certain business segments posed risks.

Q: Please start with the transaction with Core Specialty and how it will affect results prospectively?

A: Jim Petcoff mentioned the transaction was to consolidate writings, de-lever the company, enhance statutory strength of insurance companies, and write other business more efficiently. Nick Petcoff added it bolsters surplus level, and the book had high acquisition costs and limits profiles.

Q: Regarding the impact on gross premiums, is next quarter expected to have a third less insurance revenues?

A: Nick Petcoff said there will be a dip in the near term due to the transaction, but growth in other areas will offset the decline, so near term will see a decline in premiums.