It has been about a month since the last earnings report for Amerisafe (AMSF) . Shares have added about 2.4% in that time frame, outperforming the S&P 500.Will the recent positive trend continue leading up to its next earnings release, or is Amerisafe due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.AMERISAFE Q3 Earnings Met Estimates, New Business ...

Group 1 - AMERISAFE, Inc. announced the resignation of Chief Financial Officer Anastasios Omiridis, effective November 30, 2025, to pursue another opportunity [1] - The company will initiate an executive search for a new Chief Financial Officer [1] - AMERISAFE specializes in workers' compensation insurance for high hazard industries, including construction, trucking, logging, agriculture, and manufacturing [2]

Financial Performance - Gross premiums written for Q3 2025 increased to $80,321,000, up 7.8% from $74,940,000 in Q3 2024[15] - Net premiums earned for the nine months ended September 30, 2025, were $209,462,000, compared to $204,129,000 for the same period in 2024, reflecting a growth of 2.0%[15] - Net income for Q3 2025 was $13,818,000, a decrease of 3.5% from $14,324,000 in Q3 2024[15] - Net income for the nine months ended September 30, 2025, was $36,722,000, a decrease of 13% compared to $42,242,000 for the same period in 2024[25] - Total comprehensive income for the nine months ended September 30, 2025, was $41,920,000, compared to $46,761,000 in 2024, reflecting a decline of 10%[25] - Basic earnings per share (EPS) for the three months ended September 30, 2025, was $0.73, down from $0.75 in the same period in 2024, reflecting a decline of 2.7%[41] - The diluted EPS for the nine months ended September 30, 2025, was $1.92, compared to $2.21 for the same period in 2024, indicating a decrease of 13.1%[41] Assets and Liabilities - Total assets as of September 30, 2025, were $1,164,944,000, compared to $1,157,791,000 at the end of 2024, representing a slight increase of 0.6%[13] - Total liabilities decreased to $890,171,000 as of September 30, 2025, down from $900,450,000 at the end of 2024, a reduction of 1.3%[13] - Shareholders' equity increased to $274,773,000 as of September 30, 2025, compared to $257,341,000 at the end of 2024, marking a growth of 6.8%[13] Cash Flow and Dividends - Cash dividends declared per common share increased to $0.39 in Q3 2025, up from $0.37 in Q3 2024[15] - Net cash provided by operating activities was $447,000 for the nine months ended September 30, 2025, significantly lower than $13,363,000 in 2024[25] - Cash used for dividends paid to shareholders was $22.4 million in the nine months ended September 30, 2025, compared to $21.3 million in the same period of 2024[127] - The company purchased treasury stock amounting to $4,143,000 in 2025, compared to $5,121,000 in 2024, indicating a reduction of 19%[25] Investment Income - The company reported net investment income of $6,566,000 for Q3 2025, down from $7,485,000 in Q3 2024, a decline of 12.3%[15] - Net investment income for the first nine months of 2025 was $19.9 million, down 10.7% from $22.3 million in the same period of 2024[118] - The company recognized net realized gains of $3.1 million in the nine months ended September 30, 2025, compared to net realized losses of $0.2 million in the same period of 2024[57] Claims and Reserves - The reserves for loss and loss adjustment expenses decreased to $617,860,000 as of September 30, 2025, down from $651,309,000 at the end of 2024, a decline of 5.1%[13] - The company experienced a decrease in reserves for loss and loss adjustment expenses, which totaled $33,449,000 in 2025 compared to $10,508,000 in 2024, indicating a significant increase in claims management efficiency[25] - The total incurred loss for the first nine months of 2025 was $122,498 thousand, compared to $119,765 thousand for the same period in 2024, reflecting an increase of approximately 2%[66] Stock and Shareholder Information - The company issued 35,557 shares of common stock during the nine months ended September 30, 2025, raising $807,000[23] - The company repurchased 30,860 shares of its common stock for $1.3 million during the three months ended September 30, 2025, at an average price of $43.72 per share[88] - The company has repurchased a total of 1,776,468 shares of common stock for $46.2 million since the inception of its share repurchase program in 2010[142] Regulatory and Governance - The company operates as a single reportable segment, Insurance Operations, focusing on workers' compensation insurance for small to mid-sized employers in high hazard industries[90] - The Bylaws have been amended to clarify quorum requirements and voting standards for shareholder meetings[148] - Shareholder proposals for the 2026 Annual Meeting must be received by January 2, 2026, to be included in the proxy materials[150]

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Financial Data and Key Metrics Changes - The company reported net income of $13.8 million or $0.72 per diluted share for Q3 2025, compared to $14.3 million or $0.75 per diluted share in Q3 2024, indicating a decrease in net income [8][9] - Gross written premiums increased by 7.2% to $80.3 million in Q3 2025 from $74.9 million in Q3 2024, while net earned premiums grew by 6.2% [9][10] - The combined ratio for the quarter was 90.6%, reflecting disciplined underwriting practices [4] Business Line Data and Key Metrics Changes - Voluntary premiums on policies written grew by 10.6%, supported by strong new business production and renewal performance [4][9] - The accident year loss ratio remained stable at 71%, with frequency at historically low levels and severity increasing year over year [5][10] Market Data and Key Metrics Changes - The company experienced $8.9 million of favorable reserve development on prior accident years, primarily from accident years 2020 and earlier [5] - The effective tax rate increased to 21% from 19.5% in the prior year quarter [10] Company Strategy and Development Direction - The company emphasizes a balanced capital management strategy, focusing on profitability and disciplined capital deployment, including regular and special dividends [6] - The growth strategy is yielding a healthy return on average equity of 20.5%, with a focus on maintaining strong relationships with agents and policyholders [4][6] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the durability of growth, indicating that the special dividend reflects a commitment to organic growth opportunities [24] - The competitive landscape remains intense, but the company maintains a consistent approach to underwriting, which is viewed positively by agents [44] Other Important Information - The company declared a regular quarterly dividend of $0.39 per share and a special dividend of $1, payable on December 12, 2025 [5][6] - Book value per share increased to $14.47, up 7.1% year to date [12] Q&A Session Summary Question: What is the source of the recent voluntary premium growth? - Management noted that the growth is broad-based, with a 2.7% increase in policy count quarter over quarter and a 93.6% renewal retention rate [20][21] Question: How does the company view its leverage and balance sheet flexibility? - The company indicated that its leverage is around one, with an upper bound of about $1.5 million [30][31] Question: What is the latest on medical inflation? - Management acknowledged that while they are not immune to medical inflation, fee schedules in workers' compensation are providing some relief [32] Question: What trends are observed in approved state loss costs? - Management reported that most states are seeing mid-single-digit declines in loss costs, indicating relative discipline in the marketplace [34][35] Question: How is wage growth trending? - Wage growth was reported at 6.7% for the quarter, with a new employee count increase of 2% [36][37] Question: How many large losses were recorded in the quarter? - The company reported 17 large losses over $1 million year to date, up from 13 at the same point last year [39][42] Question: Is the company considering expansion into other states? - Management stated that they are constantly evaluating potential expansions but have no immediate plans [54] Question: How are fee schedules impacting medical costs? - Fee schedules are updated regularly, and there is currently no significant legislative movement affecting them [55][56]

Core Insights - Amerisafe reported quarterly earnings of $0.55 per share, matching the Zacks Consensus Estimate, but down from $0.58 per share a year ago [1] - The company posted revenues of $77.86 million for the quarter, missing the Zacks Consensus Estimate by 0.53%, and up from $74.66 million year-over-year [2] - Amerisafe shares have declined approximately 21.2% year-to-date, contrasting with the S&P 500's gain of 17.2% [3] Earnings Performance - The company has surpassed consensus EPS estimates two times over the last four quarters [1] - The earnings outlook for Amerisafe is uncertain, with current consensus EPS estimates at $0.58 for the upcoming quarter and $2.25 for the current fiscal year [7] Estimate Revisions and Market Position - The trend for estimate revisions prior to the earnings release was unfavorable, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] - The Insurance - Accident and Health industry is currently ranked in the bottom 34% of over 250 Zacks industries, suggesting potential challenges for stocks in this sector [8]

Financial Performance - Gross premiums written for Q3 2025 were $80,321,000, a 7.2% increase from $74,940,000 in Q3 2024[3] - Net premiums earned increased by 6.2% to $71,196,000 in Q3 2025, compared to $67,050,000 in Q3 2024[3] - Net income for Q3 2025 was $13,818,000, a 3.5% decrease from $14,324,000 in Q3 2024[3] - Operating net income for Q3 2025 was $10,566,000, down 5.2% from $11,140,000 in Q3 2024[13] - Basic earnings per share (EPS) for Q3 2025 was $0.73, down from $0.75 in Q3 2024, representing a decline of 2.7%[27] - Total revenues for the nine months ended September 30, 2025, were $235,661,000, slightly up from $235,014,000 in the same period of 2024[27] Investment and Assets - Net investment income decreased by 12.3% to $6,566,000 in Q3 2025, down from $7,485,000 in Q3 2024[7] - As of September 30, 2025, the carrying value of AMERISAFE's investment portfolio was $817,000,000[12] - Total assets as of September 30, 2025, were $1,164,944,000, compared to $1,157,791,000 at the end of 2024, indicating a marginal increase[29] - Shareholders' equity increased to $274,773,000 as of September 30, 2025, from $257,341,000 at the end of 2024, reflecting a growth of 6.8%[29] Premiums and Reserves - Voluntary premiums on policies written increased by 10.6% compared to Q3 2024, driven by strong policy retention and new business production[6] - Gross premiums written for Q3 2025 were $80,321,000, an increase of 4.5% from $74,940,000 in Q3 2024[27] - Net premiums earned for the nine months ended September 30, 2025, were $209,462,000, compared to $204,129,000 for the same period in 2024, reflecting a growth of 2.0%[27] - Reserves for loss and loss adjustment expenses decreased to $617,860,000 from $651,309,000, a reduction of 5.1%[29] Dividends and Tax - A special cash dividend of $1.00 per share was declared, along with a regular cash dividend of $0.39 per share, payable on December 12, 2025[8] - The effective tax rate for Q3 2025 was 21.0%, up from 19.5% in Q3 2024[6] Future Outlook - The company anticipates future share repurchases will be funded from available capital, depending on market conditions and regulatory considerations[24] - Management's forward-looking statements indicate expectations of growth opportunities in the workers' compensation insurance market, though actual results may differ due to various risks and uncertainties[23]

[Forward-Looking Statements](index=4&type=section&id=FORWARD-LOOKING%20STATEMENTS) The report contains forward-looking statements subject to risks and uncertainties that could cause actual results to differ materially - The report contains forward-looking statements that are not guarantees of future performance and are subject to risks and uncertainties, which could cause actual results to differ materially[8](index=8&type=chunk)[9](index=9&type=chunk) - Key risk factors include the cyclical nature of the workers' compensation insurance industry, increased competition, general economic conditions, developments in capital markets, technology breaches, and changes in regulations or accounting standards[9](index=9&type=chunk)[10](index=10&type=chunk) [Part I - Financial Information](index=5&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=5&type=section&id=Item%201%20Financial%20Statements) This section presents the unaudited consolidated financial statements, including balance sheets, income statements, and cash flows, with detailed notes [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------------- | :----------------------------- | :----------------------------- | | Total assets | $1,155,114 | $1,157,791 | | Total liabilities | $889,544 | $900,450 | | Total shareholders' equity | $265,570 | $257,341 | | Reserves for loss and loss adjustment expenses | $624,095 | $651,309 | | Unearned premiums | $138,784 | $121,926 | [Consolidated Statements of Income](index=7&type=section&id=Consolidated%20Statements%20of%20Income) | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | | Gross premiums written | $79,704 | $76,428 | $163,488 | $156,502 | | Net premiums earned | $69,381 | $68,633 | $138,266 | $137,079 | | Net investment income | $6,691 | $7,447 | $13,343 | $14,813 | | Total revenues | $81,088 | $75,830 | $153,685 | $156,319 | | Net income | $13,955 | $10,993 | $22,904 | $27,918 | | Diluted EPS | $0.73 | $0.57 | $1.20 | $1.46 | | Cash dividends declared per common share | $0.39 | $0.37 | $0.78 | $0.74 | [Consolidated Statements of Comprehensive Income](index=8&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | | Net income | $13,955 | $10,993 | $22,904 | $27,918 | | Unrealized gain (loss) on debt securities, net of tax | $(292) | $(820) | $1,314 | $(2,366) | | Comprehensive income | $13,663 | $10,173 | $24,218 | $25,552 | [Consolidated Statements of Changes in Shareholders' Equity](index=9&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Shareholders'%20Equity) - Total shareholders' equity increased from **$257,341 thousand** at December 31, 2024, to **$265,570 thousand** at June 30, 2025[22](index=22&type=chunk) - The company repurchased **62,757 shares** of treasury stock for **$2,796 thousand** during the six months ended June 30, 2025[22](index=22&type=chunk) - Dividends to shareholders totaled **$14,912 thousand** for the six months ended June 30, 2025[22](index=22&type=chunk) [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) | Metric | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :------------------------------------------ | :------------------------------------------ | | Net cash provided by (used in) operating activities | $(10,235) | $4,914 | | Net cash provided by investing activities | $33,076 | $5,776 | | Net cash used in financing activities | $(18,421) | $(18,761) | | Change in cash and cash equivalents | $4,420 | $(8,071) | | Cash and cash equivalents at end of period | $48,465 | $30,611 | [Notes to Unaudited Consolidated Financial Statements](index=12&type=section&id=NOTES%20TO%20UNAUDITED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) [Note 1. Basis of Presentation](index=12&type=section&id=Note%201.%20Basis%20of%20Presentation) - AMERISAFE provides workers' compensation insurance for small to mid-sized employers engaged in hazardous industries, such as construction, trucking, logging, agriculture, manufacturing, maritime, and telecommunications[28](index=28&type=chunk) - The unaudited consolidated financial statements are prepared in accordance with Form 10-Q instructions and GAAP, relying on management estimates and assumptions that may differ from actual future results[29](index=29&type=chunk)[30](index=30&type=chunk) - The company has not adopted new accounting guidance in 2025 but is evaluating prospective guidance on income tax and expense disaggregation disclosures for future annual reports[31](index=31&type=chunk)[32](index=32&type=chunk)[33](index=33&type=chunk) [Note 2. Restricted Stock, Restricted Stock Units, and Stock Options](index=12&type=section&id=Note%202.%20Restricted%20Stock%2C%20Restricted%20Stock%20Units%2C%20and%20Stock%20Options) - The company operates under the Restricted Stock Plan and the 2022 Equity and Incentive Compensation Plan, with no further grants under the 2012 Incentive Plan[34](index=34&type=chunk)[35](index=35&type=chunk) - During the six months ended June 30, 2025, **19,737 shares** of common stock were issued for vested performance awards, and **11,452 shares** of restricted common stock (market value **$1.4 million**) were awarded to non-employee directors[36](index=36&type=chunk) - Share-based compensation expense was **$0.7 million** for the quarter ended June 30, 2025, and **$1.8 million** for the six months ended June 30, 2025[37](index=37&type=chunk) [Note 3. Earnings Per Share](index=14&type=section&id=Note%203.%20Earnings%20Per%20Share) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------------------------- | :----------------------------- | :----------------------------- | :----------------------------- | :----------------------------- | | Basic EPS | $0.73 | $0.58 | $1.20 | $1.46 | | Diluted EPS | $0.73 | $0.57 | $1.20 | $1.46 | | Basic weighted average common shares | 19,038,360 | 19,083,232 | 19,037,339 | 19,102,700 | | Diluted weighted average common shares | 19,119,600 | 19,146,294 | 19,120,530 | 19,171,206 | [Note 4. Investments](index=15&type=section&id=Note%204.%20Investments) | Investment Type | June 30, 2025 (Fair Value, in thousands) | December 31, 2024 (Fair Value, in thousands) | | :-------------------------------- | :--------------------------------------- | :--------------------------------------- | | Held-to-maturity fixed maturity | $371,355 | $399,721 | | Available-for-sale fixed maturity | $306,715 | $307,750 | | Equity securities | $52,451 | $58,629 | | Short-term investments | $14,900 | $9,338 | | **Total investments** | **$758,888** | **$788,778** | - Net realized gains on investments were **$3.1 million** for Q2 2025 (vs. **$0.1 million** net losses in Q2 2024) and **$3.1 million** for H1 2025 (vs. **$0.3 million** net losses in H1 2024), primarily from sales of equity and available-for-sale fixed maturity securities[55](index=55&type=chunk)[56](index=56&type=chunk) - The company recognized **$1.8 million** of net unrealized gains on equity securities in Q2 2025, a significant improvement from **$0.1 million** net unrealized losses in Q2 2024. For H1 2025, there were **$1.3 million** net unrealized losses, compared to **$4.7 million** net unrealized gains in H1 2024[57](index=57&type=chunk) - As of June 30, 2025, the allowance for credit losses on held-to-maturity securities was **$0.1 million**, primarily for state and political subdivisions and corporate bonds. There was no allowance for credit losses on available-for-sale investments[49](index=49&type=chunk)[50](index=50&type=chunk) [Note 5. Income Taxes](index=19&type=section&id=Note%205.%20Income%20Taxes) - The company had no valuation allowance against its deferred income tax assets and liabilities as of June 30, 2025 and 2024[60](index=60&type=chunk) - Income tax expense differs from the **21% U.S. federal statutory rate** primarily due to tax-exempt investment income and state income tax accruals[61](index=61&type=chunk) [Note 6. Loss Reserves](index=19&type=section&id=Note%206.%20Loss%20Reserves) - Reserves for loss and loss adjustment expenses (LAE) are estimated using individual case-basis valuations, statistical analyses, and experience for reported and unreported claims, subject to trends in loss severity and frequency[63](index=63&type=chunk) Loss Reserve Development | Metric | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :------------------------------------------ | :------------------------------------------ | | Net balance, beginning of period | $538,567 | $554,248 | | Total incurred | $80,819 | $80,615 | | Total paid | $106,110 | $87,610 | | Net balance, end of period | $513,276 | $547,253 | - Favorable development of net reserves reduced loss and LAE incurred by **$17.4 million** in H1 2025 (vs. **$16.7 million** in H1 2024), primarily due to lower than expected severity of injuries and favorable case reserve development[64](index=64&type=chunk) [Note 7. Comprehensive Income and Accumulated Other Comprehensive Loss](index=20&type=section&id=Note%207.%20Comprehensive%20Income%20and%20Accumulated%20Other%20Comprehensive%20Loss) - Comprehensive income includes net income plus unrealized gains and losses on available-for-sale investment securities, net of a **21% tax rate**[67](index=67&type=chunk) Accumulated Other Comprehensive Loss | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | | :-------------------------------- | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | | Balance, beginning of period | $(7,269) | $(8,740) | $(8,875) | $(7,194) | | Net current period other comprehensive income (loss) | $(292) | $(820) | $1,314 | $(2,366) | | Balance, end of period | $(7,561) | $(9,560) | $(7,561) | $(9,560) | [Note 8. Fair Values of Financial Instruments](index=21&type=section&id=Note%208.%20Fair%20Values%20of%20Financial%20Instruments) - Fair value measurements are categorized into a three-level hierarchy (Level 1: quoted prices in active markets; Level 2: observable market data for similar assets; Level 3: unobservable inputs)[75](index=75&type=chunk)[79](index=79&type=chunk) Fair Value Measurements at June 30, 2025 | Asset Type | Level 1 Inputs (in thousands) | Level 2 Inputs (in thousands) | Total Fair Value (in thousands) | | :-------------------------------- | :---------------------------- | :---------------------------- | :------------------------------ | | Fixed maturity securities—available-for-sale | $14,275 | $292,440 | $306,715 | | Equity securities | $52,451 | $— | $52,451 | | **Total (June 30, 2025)** | **$66,726** | **$292,440** | **$359,166** | - Equity and treasury securities are classified as **Level 1 assets**, while other fixed maturity securities and short-term investments are classified as **Level 2 assets**[82](index=82&type=chunk)[83](index=83&type=chunk) [Note 9. Treasury Stock](index=25&type=section&id=Note%209.%20Treasury%20Stock) - The Board reauthorized a share repurchase program in July 2025 for up to **$25.0 million** with no expiration date, replacing the prior program[87](index=87&type=chunk)[96](index=96&type=chunk) - During the three and six months ended June 30, 2025, the company repurchased **62,757 shares** of common stock for **$2.8 million**, at an average price of **$44.55 per share**[86](index=86&type=chunk)[144](index=144&type=chunk) [Note 10. Segment Reporting](index=25&type=section&id=Note%2010.%20Segment%20Reporting) - AMERISAFE operates as a single reportable segment, Insurance Operations, specializing in workers' compensation insurance for small to mid-sized employers in high-hazard industries[88](index=88&type=chunk)[89](index=89&type=chunk) - Key financial measures used to evaluate performance include return on average equity and growth in book value per share[90](index=90&type=chunk) [Note 11. Subsequent Events](index=25&type=section&id=Note%2011.%20Subsequent%20Events) - The One Big Beautiful Bill Act (OBBBA) was enacted on July 4, 2025, but is not expected to have a material impact on the company's results of operations[94](index=94&type=chunk) - On July 22, 2025, the Board declared a regular cash dividend of **$0.39 per share**, payable on September 26, 2025[95](index=95&type=chunk) - On July 23, 2025, the Board reauthorized the share repurchase program for up to **$25.0 million**, replacing the prior program[96](index=96&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition, operations, and cash flows, including business overview and critical accounting policies [Business Overview](index=28&type=section&id=Business%20Overview) - AMERISAFE specializes in workers' compensation insurance for small to mid-sized employers in hazardous industries, which typically involve higher premiums and less frequent but more severe claims[99](index=99&type=chunk) - The company's strategy emphasizes proactive safety reviews, intensive claims management, and audit services to manage costs and ensure appropriate premiums[99](index=99&type=chunk) - AMERISAFE actively markets its insurance in **27 states** through independent agencies and its wholly-owned insurance agency subsidiary[100](index=100&type=chunk) [Critical Accounting Policies](index=28&type=section&id=Critical%20Accounting%20Policies) - Critical accounting policies requiring significant estimates and assumptions include reserves for loss and loss adjustment expenses, amounts recoverable from reinsurers, premiums receivable, deferred policy acquisition costs, deferred income taxes, credit losses on investment securities, and share-based compensation[101](index=101&type=chunk)[102](index=102&type=chunk) - No changes have been made to these critical accounting policies from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[102](index=102&type=chunk) [Results of Operations](index=29&type=section&id=Results%20of%20Operations) [Consolidated Results of Operations for Three Months Ended June 30, 2025 Compared to June 30, 2024](index=29&type=section&id=Consolidated%20Results%20of%20Operations%20for%20Three%20Months%20Ended%20June%2030%2C%202025%20Compared%20to%20June%2030%2C%202024) | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | Change (%) | | :-------------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | Gross premiums written | $79,704 | $76,428 | +4.3% | | Net premiums earned | $69,381 | $68,633 | +1.1% | | Net investment income | $6,691 | $7,447 | -10.2% | | Net income | $13,955 | $10,993 | +27.0% | | Diluted EPS | $0.73 | $0.57 | +28.1% | | Net combined ratio | 91.7% | 90.5% | +1.2 pp | | Return on average equity | 21.2% | 14.6% | +6.6 pp | - Gross premiums written increased by **$3.3 million**, driven by an **$8.5 million** increase in voluntary premiums, partially offset by a **$5.8 million** decrease from payroll audits[105](index=105&type=chunk) - Loss and loss adjustment expenses incurred increased slightly by **0.1%** to **$40.7 million**, with a net loss ratio of **58.6%** (down from **59.2%**). Favorable prior accident year development was **$8.6 million**[112](index=112&type=chunk) - Underwriting and certain other operating costs, commissions, and salaries and benefits increased to **$21.7 million**, leading to an expense ratio of **31.3%** (up from **29.8%**)[113](index=113&type=chunk) [Consolidated Results of Operations for Six Months Ended June 30, 2025 Compared to June 30, 2024](index=30&type=section&id=Consolidated%20Results%20of%20Operations%20for%20Six%20Months%20Ended%20June%2030%2C%202025%20Compared%20to%20June%2030%2C%202024) | Metric | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | Change (%) | | :-------------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | Gross premiums written | $163,488 | $156,502 | +4.5% | | Net premiums earned | $138,266 | $137,079 | +0.9% | | Net investment income | $13,343 | $14,813 | -9.9% | | Net income | $22,904 | $27,918 | -18.0% | | Diluted EPS | $1.20 | $1.46 | -17.8% | | Net combined ratio | 90.5% | 88.8% | +1.7 pp | | Return on average equity | 17.5% | 18.8% | -1.3 pp | - Gross premiums written increased by **$7.0 million**, driven by a **$13.7 million** increase in voluntary premiums, partially offset by a **$7.1 million** decrease from payroll audits[115](index=115&type=chunk) - Loss and loss adjustment expenses incurred increased slightly by **0.3%** to **$80.8 million**, with a net loss ratio of **58.5%** (down from **58.8%**). Favorable prior accident year development was **$17.4 million**[122](index=122&type=chunk) - Underwriting and certain other operating costs, commissions, and salaries and benefits increased by **8.2%** to **$42.3 million**, resulting in an expense ratio of **30.6%** (up from **28.5%**)[123](index=123&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) - Net cash used in operating activities was **$10.2 million** for H1 2025, a **$15.1 million** decrease from **$4.9 million** provided in H1 2024, primarily due to a **$19.3 million** increase in losses paid[126](index=126&type=chunk) - Net cash provided by investing activities was **$33.1 million** for H1 2025, up from **$5.8 million** in H1 2024, driven by lower investment purchases[127](index=127&type=chunk) - Net cash used in financing activities was **$18.4 million** for H1 2025, consistent with **$18.8 million** in H1 2024, including **$14.9 million** for dividends and **$2.8 million** for treasury stock repurchases[128](index=128&type=chunk) [Investment Portfolio](index=34&type=section&id=Investment%20Portfolio) - The carrying value of the investment portfolio, including cash and cash equivalents, decreased by **3.1%** from **$832.8 million** at December 31, 2024, to **$807.4 million** at June 30, 2025[129](index=129&type=chunk) Investment Portfolio Composition | Investment Type | Amount (in thousands) | Percentage of Portfolio | | :-------------------------------- | :-------------------- | :---------------------- | | Fixed maturity securities—held-to-maturity | $384,822 | 47.6% | | Fixed maturity securities—available-for-sale | $306,715 | 38.1% | | Equity securities | $52,451 | 6.5% | | Short-term investments | $14,900 | 1.8% | | Cash and cash equivalents | $48,465 | 6.0% | | **Total (June 30, 2025)** | **$807,353** | **100.0%** | [Prior Year Development](index=35&type=section&id=Prior%20Year%20Development) Total Net Development | Period | Total Net Development (in millions) | | :-------------------------------- | :-------------------------------- | | Three Months Ended June 30, 2025 | $8.6 | | Three Months Ended June 30, 2024 | $8.1 | | Six Months Ended June 30, 2025 | $17.4 | | Six Months Ended June 30, 2024 | $16.7 | - Favorable loss development was largely due to lower than expected severity of injuries and favorable case reserve development from closed claims and claims where the worker had reached maximum medical improvement[134](index=134&type=chunk) - The number of open claims at June 30, 2025, increased to **4,024** from **3,888** at June 30, 2024[134](index=134&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=36&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section identifies the company's primary market risks as credit, interest rate, and equity price risk, with no material changes since December 31, 2024 - The company's major market risks are credit risk, interest rate risk, and equity price risk, with no exposure to foreign currency risk[137](index=137&type=chunk) - There have been no material changes in the quantitative or qualitative aspects of the company's market risk profile since December 31, 2024[138](index=138&type=chunk) [Item 4. Controls and Procedures](index=36&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes in internal control over financial reporting - Disclosure controls and procedures were evaluated and deemed effective as of June 30, 2025, providing reasonable assurance for timely and accurate reporting[139](index=139&type=chunk) - No material changes in internal control over financial reporting occurred during the period covered by this report[141](index=141&type=chunk) [Part II - Other Information](index=37&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=37&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This item details the company's share repurchase program, including total shares repurchased and activity during the three months ended June 30, 2025 - Since its inception in 2010, the share repurchase program has repurchased a total of **1,745,608 shares** of common stock for **$44.8 million**[143](index=143&type=chunk) - During the three months ended June 30, 2025, the company repurchased **62,757 shares** for **$2.8 million**, at an average price of **$44.55 per share**[144](index=144&type=chunk) - As of July 24, 2025, **$25.0 million** was available for future repurchases under the reauthorized program[145](index=145&type=chunk) [Item 5. Other Information](index=37&type=section&id=Item%205.%20Other%20Information) This section confirms no directors or officers adopted, modified, or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the fiscal quarter - No directors or officers adopted, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the fiscal quarter ended June 30, 2025[146](index=146&type=chunk) [Item 6. Exhibits](index=38&type=section&id=Item%206.%20Exhibits) This item lists all exhibits filed with the Form 10-Q, including organizational documents, equity incentive plan amendments, and certifications - Exhibits include the Amended and Restated Certificate of Formation and Bylaws, the Non-Employee Director Restricted Stock Plan, Section 302 and 906 certifications, and XBRL interactive data files[148](index=148&type=chunk) [Signatures](index=39&type=section&id=SIGNATURES) This section contains the official signatures of the company's President, CEO, and CFO, certifying the report on July 25, 2025 - The report is signed by G. Janelle Frost (President, CEO, and Director) and Anastasios Omiridis (Executive Vice President and CFO) on July 25, 2025[152](index=152&type=chunk)

Financial Data and Key Metrics Changes - For Q2 2025, Amerisafe reported net income of $14 million or $0.73 per diluted share, compared to $11 million or $0.57 per diluted share in Q2 2024, indicating a significant increase in profitability [10] - Operating net income for Q2 2025 was $10 million or $0.53 per diluted share, down from $11.1 million or $0.58 per diluted share in the same quarter last year [10] - Gross written premiums increased by 4.3% to $79.7 million in Q2 2025 from $76.4 million in Q2 2024 [10][11] - The expense ratio rose to 31.3% in Q2 2025 from 29.8% in Q2 2024, reflecting ongoing investments in growth [11][12] Business Line Data and Key Metrics Changes - Voluntary premiums for policies written in the quarter grew by 12.8%, supported by new business production and strong renewal retention of 93.8% [5][11] - The in-force policy count increased by 3.4% in the quarter, indicating effective risk selection and agent collaboration [5][10] Market Data and Key Metrics Changes - The workers' compensation market remains competitive, with the industry's combined ratio below 100% for 2024, but not improving compared to 2023 [6] - Approved loss costs for workers' compensation are down mid-single digits, with California being an outlier with an 8.7% increase [6] Company Strategy and Development Direction - Amerisafe is focused on maintaining pricing discipline and effective risk selection while navigating a competitive market [5][24] - The company has reauthorized a $25 million share repurchase program, reflecting confidence in long-term business value [8] - The investment portfolio remains high quality, with a focus on municipal bonds and a conservative approach to capital management [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in Amerisafe's operational positioning and strong balance sheet to generate consistent underwriting profitability, regardless of market conditions [7] - The claims team has demonstrated expertise in managing loss experience, with a current accident year loss ratio of 71% [7][10] - Management noted that while there is upward pressure on loss ratios due to declining loss costs, the company is well-prepared to manage these challenges [46] Other Important Information - The company declared a regular quarterly cash dividend of $0.39 per share, payable on September 26, 2025 [8] - Book value per share increased to $13.96, up 3.3% year-to-date, and statutory surplus rose to $257 million from $235 million at year-end 2024 [15] Q&A Session Summary Question: What drove the impressive 13% growth in premiums? - Management attributed the growth to employee focus on ease of doing business, agent effectiveness, and scalability, resulting in a 5.8% increase in policy count since year-end [20][22] Question: Any change in average policy size? - Management indicated a slight change, with average premium size potentially down slightly, but still within the target range [25][26] Question: Observations on medical inflation? - Management noted a 6% increase in medical severity for 2024, but they have not changed their reserving practices based on current trends [28][30] Question: Any stats on new business production? - While specific numbers were not disclosed, management highlighted successful new business growth despite a decrease in agent count [34][36] Question: How is the company balancing share repurchases and special dividends? - Management confirmed that there is capital sufficiency for both share repurchases and potential special dividends [48] Question: What is the long-term target for the expense ratio? - Management indicated that they expect to remain within historical ranges for the expense ratio, which is currently at 31.3% for the quarter [50][51] Question: What drove the increase in policyholder dividends? - Management explained that the increase was due to more policies qualifying for dividends, reflecting both competitive and loss experience factors [54][56]

Core Insights - AMERISAFE, Inc. (AMSF) reported second-quarter adjusted earnings per share of 53 cents, missing the Zacks Consensus Estimate by 3.6% and reflecting an 8.6% year-over-year decline [1][8] - Operating revenues reached $76.1 million, showing a slight year-over-year increase but falling short of the consensus mark by 1.5% [1][8] Financial Performance - Net premiums earned increased by 1.1% year over year to $69.4 million, but were below the Zacks Consensus Estimate of $70.5 million, supported by strong retention rates and new business growth [3] - Net investment income dropped 10.2% year over year to $6.7 million due to reduced investable assets, although it exceeded the consensus estimate of $6.6 million [3] - Pre-tax underwriting profit was reported at $5.7 million, down 12.2% year over year [4] - Total expenses rose by 2.5% year over year to $63.6 million, driven by higher loss and loss adjustment expenses [4][8] - Operating net income decreased by 9.7% year over year to $10 million [4] Ratios and Metrics - The net combined ratio was 91.7%, worsening by 120 basis points year over year and exceeding the consensus estimate of 90.5% [5] - Return on average equity improved by 660 basis points year over year to 21.2% [6] Capital Management - AMERISAFE repurchased 62.8 thousand common shares for $2.8 million in the second quarter and reauthorized a $25 million share repurchase program [7] Dividend Announcement - A quarterly cash dividend of 39 cents per share was announced, scheduled for payment on September 26, 2025, to shareholders of record as of September 12 [9]