Q2 2024 Donegal Group Inc Earnings Call (Pre-recorded) Transcript
Key Points
- Net premiums earned increased by 8.3% to $234.3 million.
- Expense ratio improved to 31.9% from 34.2% in the prior-year quarter.
- Investment income rose by 9% to $11.1 million.
- Personal lines net premiums written increased by 12.1%, driven by aggressive premium rate increases and strong policy retention.
- Successful execution of strategic non-renewals in Georgia and Alabama, leading to a 10.4% growth in commercial lines net premium written excluding these states.
- Combined ratio remained high at 103%, indicating ongoing underwriting challenges.
- Weather-related losses increased to $24.7 million, impacting the loss ratio significantly.
- Workers' compensation line experienced unfavorable reserve development, adding 17.4 percentage points to the current quarter loss ratio.
- Large fire losses contributed 5.3 percentage points to the loss ratio, indicating ongoing risk in this area.
- Higher technology costs related to systems modernization initiatives partially offset expense reductions.
Good morning and thank you for joining us today. This morning, Donegal Group issued its Second Quarter 2024 Earnings Release outlining its results. The release and a supplemental investor presentation are available in the Investor Relations section of Donegal's website at www.donegalgroup.com. Please be advised that today's conference was pre-recorded, and all participants are in listen-only mode. Speaking today will be President and Chief Executive Officer, Kevin Burke; Chief Financial Officer, Jeff Miller; Chief Underwriting Officer, Jeff Hay; Chief Operating Officer, Dan DeLamater; and Chief Investment Officer, Tony Viozzi.
Please be aware that statements made during this call that are not historical facts, are forward-looking statements and necessarily involve risks and uncertainties that could cause actual results to vary materially. These factors can be found in Donegal Group's filings with the Securities and Exchange Commission, including its annual report on Form 10-K and
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