Safety Insurance(US:SAFT)2025-05-09 17:16Premium Growth - For the three months ended March 31, 2025, direct written premiums increased by 11.8% to $298,970,000 compared to $267,339,000 in the same period of 2024[122]. - The company achieved a net written premium growth of 9.8% for the same period, driven by rate increases, improved retention, and new business production[122]. - Direct written premiums increased by $31,631, or 11.8%, to $298,970 for the three months ended March 31, 2025, compared to $267,339 for the same period in 2024[148]. - Net written premiums rose by $24,485, or 9.8%, to $274,780 for the three months ended March 31, 2025, from $250,295 in the comparable 2024 period[149]. - Net earned premiums increased by $36,637, or 15.5%, to $272,690 for the three months ended March 31, 2025, compared to $236,053 for the same period in 2024[150]. - Average written premium per policy increased by 9.5%, 8.4%, and 11.0% in Private Passenger Automobile, Commercial Automobile, and Homeowners lines, respectively[122]. Financial Performance - Non-GAAP operating income for the quarter was $18,996,000, up from $13,746,000 in the prior year, translating to $1.28 per diluted share compared to a loss of $0.93 per diluted share in 2024[124]. - The combined ratio improved to 99.4% from 101.9% year-over-year, indicating enhanced underwriting profitability[131]. - Net income for Q1 2025 was $21,896, up from $20,078 in Q1 2024, reflecting a year-over-year increase[170]. - Non-GAAP operating income rose to $18,996 in Q1 2025 from $13,746 in Q1 2024, primarily due to an increase in net earned premiums[171]. - Net cash provided by operating activities was $3,173 in Q1 2025, compared to net cash used of $21,135 in Q1 2024[175]. - Net cash provided by investing activities was $16,129 in Q1 2025, down from $27,399 in Q1 2024; purchases of invested assets increased to $59,383 from $50,199[176]. Losses and Reserves - Losses and loss adjustment expenses rose by 13.0% to $190,290,000, with a loss ratio improvement to 69.8% from 71.3% year-over-year[123][131]. - As of March 31, 2025, the total net reserves for losses and LAE are estimated at $546,207, with a range of reasonably possible estimations between $500,469 and $572,420[202]. - The recorded reserves for the private passenger automobile line of business are $261,070, with low and high estimations of $240,015 and $267,198 respectively[204]. - The total net reserves for the commercial automobile line of business are recorded at $117,747, with retained reserves of $83,271[210]. - The homeowners line of business has recorded reserves of $102,031, with a low estimation of $95,939 and a high estimation of $104,844[204]. - The company experienced a decrease in prior year reserves of $12,238 during the three months ended March 31, 2025[223]. Investment Performance - Net investment income decreased by $657, or 4.3%, to $14,574 for the three months ended March 31, 2025, from $15,231 in the comparable 2024 period[152]. - Earnings from partnership investments increased to $2,112 for the three months ended March 31, 2025, compared to $1,772 for the same period in 2024[153]. - Net realized gains on investments surged to $4,263 for the three months ended March 31, 2025, compared to $492 for the comparable 2024 period[154]. Strategic Initiatives - The company plans to focus on strategic growth initiatives, including product development and market expansion, to enhance its competitive position[232]. - The company emphasizes the importance of monitoring external factors such as inflation and supply chain delays that could affect loss severity and overall financial results[233]. - The forward-looking statements highlight potential risks including market competition, regulatory changes, and economic conditions that could impact future performance[231][233]. Market Position - The company maintained a strong market position, being the third largest private passenger automobile carrier in Massachusetts with a 9.7% market share[119]. - The company has established relationships with 828 independent insurance agents across Massachusetts, New Hampshire, and Maine[119]. Tax and Dividends - The effective tax rate for Q1 2025 was 22.4%, up from 21.6% in Q1 2024, primarily due to executive compensation expenses[170]. - Safety Insurance paid dividends of $12,875 to Safety in Q1 2025, with a maximum of $75,879 available for dividends in 2025 without prior approval[183]. - The company has authorized a share repurchase program of up to $200,000, with no shares repurchased during Q1 2025[186].