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United Insurance(ACIC) - 2024 Q1 - Quarterly Report
ACICUnited Insurance(ACIC)2024-05-10 20:03
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Financial Performance - Gross premiums written for the three months ended March 31, 2024, were 197,458,000,anincreasefrom197,458,000, an increase from 187,123,000 in the same period of 2023, representing a growth of 7.1%[155] - Gross premiums earned increased to 168,822,000forthethreemonthsendedMarch31,2024,comparedto168,822,000 for the three months ended March 31, 2024, compared to 144,476,000 for the same period in 2023, reflecting a growth of 16.9%[156] - Net premiums earned decreased to 68,730,000inQ12024from68,730,000 in Q1 2024 from 87,324,000 in Q1 2023, a decline of 21.2%[156] - Total revenues for the three months ended March 31, 2024, were 73,204,000,downfrom73,204,000, down from 90,320,000 in the same period of 2023, a decrease of 18.9%[156] - Net income from continuing operations for Q1 2024 was 23,599,000,comparedto23,599,000, compared to 30,367,000 in Q1 2023, a decline of 22.3%[156] - Net income attributable to American Coastal Insurance Corporation for Q1 2024 decreased by 243,681,000,or91.2243,681,000, or 91.2%, to 23,599,000 from 267,280,000inQ12023[190]RatiosandEfficiency−Thelossratio,netforQ12024was23.1267,280,000 in Q1 2023[190] Ratios and Efficiency - The loss ratio, net for Q1 2024 was 23.1%, compared to 18.9% in Q1 2023, indicating a deterioration in loss performance[156] - The expense ratio for Q1 2024 improved to 35.2% from 43.4% in Q1 2023, reflecting better cost management[156] - The combined ratio for Q1 2024 was 58.3%, an improvement from 62.3% in Q1 2023, indicating enhanced operational efficiency[156] - The underlying loss and LAE ratio for Q1 2024 was 9.2%, a decrease of 2.5 points from 11.7% in Q1 2023[195] Investment and Cash Management - Total cash, cash equivalents, restricted cash, and investment portfolio increased to 504,456,000 as of March 31, 2024, from 369,022,000atDecember31,2023,representinga36.6369,022,000 at December 31, 2023, representing a 36.6% increase[166] - The investment portfolio consisted of 39.4% total investments, with cash and cash equivalents making up 56.6% of the total as of March 31, 2024, compared to 41.7% at December 31, 2023[167] - Approximately 83.1% of fixed maturities were U.S. Treasuries or corporate bonds rated "A" or better as of March 31, 2024[167] - The company does not invest in derivative securities and limits investments in non-investment-grade fixed maturities[166] - The investment strategy aims to preserve capital, maximize after-tax investment income, maintain liquidity, and minimize risk[165] - Cash inflows from operating activities totaled 124,484,000 for the three months ended March 31, 2024, compared to cash outflows of 104,164,000duringthesameperiodin2023[225]−Netpurchasesofinvestmentstotaled104,164,000 during the same period in 2023[225] - Net purchases of investments totaled 2,005,000 during the three months ended March 31, 2024, compared to net sales of investments of 195,082,000duringthesameperiodin2023[226]−Cashprovidedbyfinancingactivitiestotaled195,082,000 during the same period in 2023[226] - Cash provided by financing activities totaled 11,398,000 for the three months ended March 31, 2024, compared to no cash used in financing activities for the same period in 2023[227] Policy and Claims Management - The total number of catastrophe loss events incurred in Q1 2024 was 6, with total losses of 754,000,comparedto3eventsand754,000, compared to 3 events and 2,615,000 in Q1 2023[182] - Unpaid losses and loss adjustment expenses totaled 279,556,000asofMarch31,2024,downfrom279,556,000 as of March 31, 2024, down from 370,221,000 as of December 31, 2023[186] - The total ceding ratio for reinsurance costs increased to 59.3% for the three months ended March 31, 2024, compared to 39.6% for the same period in 2023[174] - Ceded premiums earned amounted to 100,092,000forthethreemonthsendedMarch31,2024,comparedto100,092,000 for the three months ended March 31, 2024, compared to 57,152,000 for the same period in 2023, reflecting a significant increase[178] Segment Performance - Gross written premiums for the commercial lines operating segment increased by 7,960,000,or4.57,960,000, or 4.5%, to 184,601,000 for the three months ended March 31, 2024, from 176,641,000forthesameperiodin2023[200]−Pretaxearningsforthecommerciallinesoperatingsegmentdecreasedby176,641,000 for the same period in 2023[200] - Pretax earnings for the commercial lines operating segment decreased by 6,124,000, or 15.7%, to 32,795,000forthethreemonthsendedMarch31,2024,from32,795,000 for the three months ended March 31, 2024, from 38,919,000 for the same period in 2023[199] - Gross written premiums for the personal lines operating segment increased by 2,375,000,or22.72,375,000, or 22.7%, to 12,857,000 for the three months ended March 31, 2024, from 10,482,000forthesameperiodin2023[210]−Pretaxearningsforthepersonallinesoperatingsegmentincreasedby10,482,000 for the same period in 2023[210] - Pretax earnings for the personal lines operating segment increased by 3,013,000, or 158.0%, to 1,106,000forthethreemonthsendedMarch31,2024,fromapretaxlossof1,106,000 for the three months ended March 31, 2024, from a pretax loss of 1,907,000 for the same period in 2023[209] Operational Changes - As of October 6, 2023, the company is seeking a buyer for Interboro Insurance Company (IIC) to exit the personal lines business, with the expected sale price being the book value of the entity[153] - A capital contribution of 1,265,000wasmadetothereinsurancesubsidiary,UPCRe,duringthethreemonthsendedMarch31,2024[220]−ThenumberofnewandrenewalpoliciesinFloridadecreasedto1,062inQ12024from1,157inQ12023[193]−Totaloperatingexpensesdecreasedby1,265,000 was made to the reinsurance subsidiary, UPC Re, during the three months ended March 31, 2024[220] - The number of new and renewal policies in Florida decreased to 1,062 in Q1 2024 from 1,157 in Q1 2023[193] - Total operating expenses decreased by 13,758,000 to 24,175,000inQ12024from24,175,000 in Q1 2024 from 37,933,000 in Q1 2023[196]