Q1 2020 Earnings Call
Good morning, and welcome to fed Nat holding company's first quarter 2020 conference call. My name is Cindy and I'll be your conference. Operator. This morning at this time, all participants will be in listen only mode. Before we begin today's call I'd like to remind everyone that this conference call is being recorded as well.
I live broadcast live via webcast. Additionally, today's call will be available via webcast replay. It later this afternoon and accessible by visiting the investors relation Investor Relations section of Fed Nat website at Www Dot F D in a TV dot.
Now I'd like to turn the call over to Mr. Bernie kill Kelly.
I had net Investor relations.
Sir go ahead.
Thank you.
Good morning, and welcome again to fed nuts first quarter 2020 conference call.
Our earnings release and prepared remarks include references to non-GAAP measures such as adjusted operating income.
We used these non-GAAP measures to provide greater transparency and a more meaningful official comparison to prior years results.
Non-GAAP reconciliations from the GAAP metrics to the non-GAAP measures are available in our earnings release.
<unk> mentioned this conference call that are not historical facts are forward looking statements words, such as anticipate estimate expect predict project and other similar words or phrases or intended to identify forward looking statements.
The matters discussed on this call that are forward looking statements are based on current management expectations involving risks and uncertainties that may result in these expectations not being realized.
Actual event outcomes and results may differ materially from what is expressed or forecasted in forward looking statements made on this call due to numerous risks and uncertainties.
Including but not limited to the risks and uncertainties described in this conference call. Our press release issued yesterday and other filings made by the company with the FCC from time to time.
Forward looking statements made during this conference call speak only as of today's date and fed Nat specifically disclaims any obligation to update or revise any forward looking statements to reflect new information future events or circumstances or otherwise.
Now I will turn the call over to fed Nat Executive Officer, Mike Braun.
Good morning, and welcome to our first quarter 2020 conference call Rod Jordan, Our Chief Financial Officer, and Air Fernandez, Our Chief Accounting officer or on the call with me this morning.
Hi, I'm going to give an overview of the quarter then Ronald ride a deeper dive into the financial results and then we will have time for questions before we discuss our first quarter results. We wanted to acknowledge the unprecedented challenges that many people are currently experiencing throughout our country and specifically in the many communities in which we.
We operate from bought that helps and an economic perspective.
Hearts go out everyone touched by the coded 19 pandemic and said that is grateful to all those serving our communities from the many doctors and nurses. So those are keep are essential services and products available such as truck drivers and supermarket workers.
We remain committed to all our stakeholders, well being especially our staff policyholders and partner agents. During this crisis. Thank you to all.
We are pleased with fed that's improved performance in the first quarter, which was driven primarily by strong growth an increase profitability in our non Florida homeowners business, we continue to return value to shareholders through dividends and share repurchases, while maintaining a strong balance sheet and.
Capital position.
We're especially proud of these results because our team has demonstrated resilience and incredible dedication to our policyholders and these unprecedented times.
That that places the highest priority on the health and safety of ourselves.
So we put in place our business contingency plans to enable working remotely back in March.
Our staff has risen to the occasion as they do in response to all the emergency situations, we deal with in our business, providing the highest quality service to our policyholders and our partner agents.
Vast majority of our staff is working remote and can't continue to do so it definitely no. We will continue to monitor and any changes to that based on the recommendations and guidelines provided by the state and local governments, where we operate.
As we stated in Yesterdays release, we do not expect the cobot 19 pandemic directly impact our underwriting results.
As with any of them that have such a widespread economic Uh huh.
There could be tangentially seal impacts to said now.
We will closely monitor the states in communities, we operate in focusing on the housing and rental markets to track and adjust to the long term effects that develop.
Looking now at our first quarter results are non Florida expansion has proven to be profitable opportunity that we expected.
Homeowners' premiums from non Florida markets more than doubled from last year's first quarter by every measure with gross earned premiums up 180%.
Our non Florida business represented 32% of total gross earned premiums compared to approximately 15% last year.
We achieved strong organic growth as we expanded our market presence in Texas, South Carolina, Louisiana, and Alabama through our managing general agent same store.
In addition to organic ROE Mason contribute over 23.5 million in gross earned premiums in its first full quarter since the acquisition last December.
Most importantly, all of this grow added to profitability with net income in our non Florida homeowners business rising sharply from last year's first quarter, excluding cat losses.
We continue to be proactive in our Florida homeowners business to improve profitability in the challenging market environment.
We are taking rate increases, including the expedited reinsurance rate increase of 2.8%.
Went into effect in March.
The 7.4% slaughter rate filing we previously announced has received contingent verbal approval with full approval believed to be in final stages and continues to be on track for June 15 effective date.
We are following rigorous underwriting practices in Florida for both new and policies on renewals.
That said that's more to policy count is down approximately 5% while its gross written premium of slot.
Indicating stronger pricing in this book of business, we plan to continue to limit our appetite in Florida until late this year. When we expect that are fruit regulatory rates will more accurately reflect our increased cost of doing business.
Merrily related to increase litigation costs and reinsurance expenses.
While this operating environment remains challenging we are continuing to see the favorable and you'll be trends that we mentioned on our last call.
As an update since they will be reform was enacted on July 120, 90, we've only had 17 ill be lawsuits on claims with post reform date of loss. This compares to 104 it'll be lawsuits over the comparable timeframe last year.
While we continue to see high volume of claims were encouraged by this 84% reduction in the number of eight will be claims going to sue.
We believe this will surely be a net positive in reducing you'll be claim severity going forward.
Our loss ratio in our Florida homeowners business continues to be impacted by the challenging market conditions. We discussed on our fourth quarter conference call. We continue to feel pressure from the powerful playing to smart in Florida that continues to bring litigation against insurers through different avenues. However, we believe our concern.
<unk> approach to underwriting in this market paired with our industry leading rate increases are the necessary actions to mitigate this pressure and focus on expansion and other more profitable markets at this time.
We are currently working to finalize our reinsurance program for the 2020 2021 program year and are pleased with the level of participation in the quality of our reinsurance partners.
We expect reinsurance pricing to increase we remain proactive interactions to ensure profitability through timely rate increases in Florida, and non Florida markets to offset these increased costs.
Setting its balance sheet and capital position remains strong and as Ron will discuss in more detail our investment portfolio performance was solid despite tremendous market volatility.
This strength enabled us to be aggressive in our share repurchase program in the first quarter repurchasing 524000 shares at an aggregate cost of approximately 6.8 million in the period.
Subsequent to quarter end, we've purchased an additional 277000 shares at an aggregate cost of approximately 3.2 million.
This 10 million of repurchases. In addition to 3.9 million of shares we repurchased since December means that we have repurchased a total of 1.038 million shares representing well over 7% of shares outstanding since the close of the makes on acquisition on December 2nd.
Any 19.
In March our board of directors authorized an additional 10 million authorization to our share repurchase program and today, we have the entire incremental authorization at our disposal for the balance of 2020.
Our board will continue to make decisions on repurchases based on the capital needs of the company as well as market conditions, but we continue to view repurchases below book value.
An attractive use of our capital.
Looking ahead, we are taking the unprecedented time very seriously. We believe we have limited exposure to the effects of coated 90, but our continue to monitor the economic impact very closely.
We believe our staff and network and agents will continue to enable us to rise to the needs of our policyholders and generate value for our shareholders now I'll turn the call over Iran to go over the numbers.
Thanks, Mike and good morning, everyone as Mike mentioned, we're operating in unprecedented times. So we're extremely proud of our team and their contributions to our first quarter performance. We are generating strong profitable growth in our non Florida book proactively taking rate in Florida ended.
Beyond as we hold steady and that's challenging market conditions prudently managing our conservative investment portfolio and returning value to shareholders through dividends and buybacks, while maintaining our solid capital position.
Before we jump in the first quarter financial results I wanted to point out a slight change in our reporting that she may have noticed in our earnings release going forward. We are eliminating line of business presentation in our quarterly financial statements. As you know we're currently in runoff mode in our auto and CGS.
Given the absence of underwriting activity. We believe it is the appropriate time to eliminate the presentation for PNM statements for these lines here at the start of 2020.
We will continue to provide updates for these former lines of business as necessary disclosing any loss reserve activity. For example, if it occurs our go forward operations and results are truly driven by our homeowners business and this external reporting change further demonstrates this fact, we look forward.
Second continuing to communicate our planned profitable growth in our Florida, and non Florida books as transparency with our shareholders is a priority for management.
Looking now at first quarter results.
As previously disclosed in our pre release 8-K about three weeks ago. Our pretax net income was reduced by 8.7 million of catastrophe losses net of all recoveries, including reinsurance.
This impact was predominantly the result of two storms. So we had a total of five tcf severe weather events that impacted Florida, Texas and Louisiana.
These storms added approximately 10 points to our loss ratio and 8.2, our combined ratio in the quarter and reduced our earnings by 6.6 million or 46 cents per share.
Consequently.
Net income in the first quarter was 2.1 million or 15 cents per share. This compares to a net loss in last year's first quarter of 3.9 million more 30 cents per share, which included the impact of 19 million a pretax catastrophe losses.
Adjusted operating income in this year's first quarter was 4.3 million or 30 cents per share compared with adjusted operating loss of 2.4 million or 19 cents per share last year.
The primary onetime adjustment between net income and operating income in this year's first quarter was the impact of mark to market adjustments in our equity portfolio, which I'll address later.
As Mike mentioned, we achieved strong premium growth in the first quarter, Mike highlighted key gross earned premium metrics. So I'll focus on written premium instead gross written premiums grew 31% year over year to approximately 173 million with non Florida gross written premiums.
Up 129%, we continue to diligently restrict underwriting in our Florida book, particularly in effort I see.
Where gross written premium was flat despite the rate increases that continue to earn in this underscores the increased contribution of our non Florida book May Sons' first full quarter added approximately 17.6 million of gross premiums written but 95% of it coming from the Louisiana and Texas.
But we were especially pleased with our strong organic growth of more than 62% as we expanded our market presence outside of Florida overall gross written premiums in our non Florida markets more than double growing to 58 million from 25 million in 2019.
We're especially pleased about the fact that this growth was profitable growth with our net income contribution from non Florida markets rising sharply excluding cats consistent with our past mantra, we continue to focus on our bottom line profitability more so than topline growth.
Continuing with the topic of revenues, Mike addressed our Florida rate increases in his remarks. These rate increases will be further bolstered by increases in our non Florida markets in Texas, a 5% rate increase went into effect on April 1st and we are continuing to earn out the Texas and Louisiana.
The increases from last fall, including the 31% rate increase from August at me.
Our overall rate increases are on track to generate over 25 million of incremental premium in the balance of 2020.
And we continue to estimate that was fairly fully earned out in the third quarter of 2021. These increases will contribute over $50 million of incremental annual premium as compared to 2018.
Turning to our non core operations. We are pleased to report that the impact of these lines diminished substantially in the first quarter auto continues to run off and had no earnings impact in the quarter whatsoever.
Our CGM business also in run off experienced prior year development of just under $1 million net driven by a further uptick in frequency and severity, particularly on late reported claims from older accident years.
Let's turn to our capital structure and investment portfolio.
Our balance sheet and capital position remains strong despite significant market volatility we ended the quarter with cash and cash equivalence of 123 million with liquidity of over 75 million in our Holdco and non regulated subsidiaries as of March 31.
Book value per share was essentially flat versus year end $17 in 15 cents. Despite over 8.6 million of pretax unrealized losses on our investment portfolio in the quarter. This impact was largely offset by our net income in the period and the beneficial impact of the 6.8.
Million of buybacks, we executed in the quarter.
With that mention of investment losses on the I'll now turn briefly to our investment portfolio. The last 45 to 60 days has certainly been eventful and the capital markets and portfolio management took center stage for several weeks there from mid March too early April I'm pleased to report that the $8.6 million.
Unrealized losses in the first quarter that I mentioned, a moment ago, which consisted of 3.3 million loss on equity securities and a 5.3 million unrealized loss on bonds has since swung to a year to date gain of three and a half million representing approximately $12 million.
Value recovery since April one.
Our bond portfolio has swung to a year to date gain of approximately 5.4 million well the loss on our equity position has shrunk to 1.9 million.
We believe this resilience is a direct reflection of our disciplined investment approach and the investment grade portfolio. We've built we have said this before our portfolio is designed to preserve capital maintain liquidity and minimize risk across a range of economic scenarios.
Our primary objectives remain our focus and we have the discipline to not compromise. These priorities for the sake of a few more basis points of yield the past few months have perhaps than the strongest litmus test yet for our thesis and we are pleased with our outcome.
We continue to closely monitor the markets and are applying a stringent risk appetite to our portfolio and capital allocation considerations. As we know there are more challenging times to come in the capital markets.
With that said the strength of our balance sheet has enabled us to be aggressive in share repurchases and Mike gave a comprehensive update on our share repurchase activity for Q1, and subsequent we remain committed to responsibly returning value to shareholders and view share repurchases as an attractive use of cash.
No.
In closing we believe we have the right strategy in place to generate improved financial performance in 2020, we remain focused on mitigating challenges in our Florida market through proactively taking rate and profitably expanding our presence in non Florida markets, where we are seeing favorable results we will.
Continue to prudently manage our investment portfolio and believe we are well positioned to return capital to shareholders, while driving strong results and with that I'll turn the call back over to Mike.
Yes. Thank you Ron that's great operator, Cindy if you can go ahead and open it up two questions I'd be great.
At this time in order to ask a question you will need to press star one on your telephone to withdraw your question can you make press the pound Keith please standby probably compiled acuity roster.
Your first question comes from.
Greg Peters from Raymond James.
Hey, good morning team.
I'm going to ask three questions one on reinsurance one on commission expense and one on capital.
So Mike I know you commented that you gave some color in your opening comments on reinsurance.
Can you can you give us some more perspective on how things were going to change for you for this upcoming storm season, whether its retentions or top limited et cetera.
Yeah, Greg Good morning, Great question.
Insurance as a very hot topic and over the last two years, there has been pressure on reinsurance pricing.
For a couple of reasons number one there has been a lot of cat events lot of activity never to some of the capacity in the retro markets.
Has gone away.
And number three other macro situations. So last year, we did have a big rate increase and I think that was appropriate last year.
And.
We were able to pass that through in our rate filing to the policyholders, but obviously there is a lag.
As we do the renewal right now we're well underway.
We've got a majority of our cat program in place for.
We're finishing it out.
In the coming days with the coming weeks, we have ample time.
We have a full panel 75, plus reinsurers and it's the renewals going well.
Well, let let's be clear there's pressure on pricing and I think what you're seeing is the pricing that dips two years ago. In 2018 was not sustainable for our reinsurance partners and and we respect and we appreciate that and we want a trading relationship that's profitable for both parties.
So there's pressure on them the pricing is ticking up but I think it's extremely manageable.
What we face and just to remind everybody approximately 32% of our premium does go to reinsurance spend.
So if in fact that went up 10% you can do the math and understand that we would probably file about a 3.2% rate increase there'd be some other costs associated with that so perhaps it's 4% 5%.
And obviously if rates were to go up more than 10% you would multiply the map out appropriately. So we have healthy relationship with our partners. We paid out a 1 billion five in cat claims over the last three four years.
These folks need to have a return on their investment in their trading relationships. So so the renewals going smell.
Okay. Thank you for the answer then switching gears to commission expense.
Are you called out the higher.
Higher expense ratio because of non Florida acquisition.
Ken going forward, because your non Florida businesses growing is it fair to assume that the expense ratio is going to be up on a year over year basis for the remainder of the year or can you give us some added color.
Yeah, I think it it depends on a lot of factors, Craig because yes R F and I see non Florida book with through say sure is growing strongly but we also have may some which is our organic distribution model and has a lower.
<unk> expense structure in non Florida.
Then say it sure does.
The other factor of course associated with that.
Those higher non Florida acquisition cost flip side as we also of course have a lower loss ratio and that's on that business and that's why we tend to focus more on combined ratio as we look at the.
F and I see Florida book.
Yes on that point when when the profit share from say sure flows through or lack thereof flow through your income statement is that come through commission expense or is it coming through another line.
Yeah, that's coming through commission expense.
Okay to think about it is.
Imagine if we had a if we had a quota share treaty in place right, we would be seating premiums losses commissions et cetera. That's the case in our Florida book with our 10% Swiss re quota share with respect to.
Say sure. The economics are such that we're seeing 50% of premiums losses commissions everything but the financial statement presentation is that's a net of all that that profit is showing up in the commission expense line and just as a.
As a point of reference in the current quarter.
That added I think 4.2, the expense ratio our Sage your book.
Relative to the gross earned on that block.
Got it the final question I know you gave some comments in color around this but when I think about.
Where on a go forward basis with the increase in the total gross written premium.
And that what should I think about in terms of the range of acceptable ratios considering your rating.
In terms of say premiums to surplus whether its net or gross.
Especially in the context, the fact that you're using excess capital too.
For dividends and share repurchase.
You know Greg good question and roughly speaking there's.
I would say roughly three and a half the one gross over stat, but those numbers are influenced by many things.
So I can tell you the way, we manage our insurance capital the capital than our insurance companies.
Finally, RBC is a big component of it and in addition to that we want to make sure we have adequate capital of holding company.
So.
Our desire with our capital a scroll business and that's the intense but where our stocks trading. It's it's awfully accretive to go head and pick up the shares at such a discount to book, but we think we've got to adequate capital new turns companies as well the holdco.
Okay, great great answers.
Your next question comes from Mike Excuse me Matt.
Let me from JMP.
Hey, Thanks, good morning might bring Ron.
Good morning, Matt.
One question I was hoping you could.
Help me with.
Deeper dive on Texas into some of the metrics there so.
I mean I caught the comment so in the prepared remarks and in the press release about growth is going really well there.
And I'm, hoping you can help us tie that together with some of the comments you made.
Right around the time of acquiring makes on and talking about how some of that Texas business was under price to me, there's too much cat exposure and you're pushing a lot a rate increase particularly in the Dallas area and so could you help us through kind of of that growth that's coming through maybe what is rate what is PPIF what.
As happened to cat exposure in Dallas, just kind of help us separate the pieces to understand while that while there is good growth kind of our do those two statements to line up with each other.
Yeah, Matt Great question.
So since the.
We closed on makes on what we're happy with.
Prior to based on our exposure and Texas was through same store, they're fantastic partner.
They they have avoided Dallas.
Because they're not happy with the pricing.
So they've been much more coastal primarily Houston up until up into San Antonio. So there's multiple rate increases that are working through those that book Thats fed Nat book with with our MG you.
Which is same store and those are small I believe we have two rate increases of around 5% each and that book continues to perform well and it continues to grow in terms of May sawn. There's three different books. There, there's the Louisiana book, which were happy with and there's not much rate action. There we've taken that rate back really.
In 2019, some of that is fully earned in some of it continues to earn in.
Makes on in Florida is way as way underweight.
We're going to be putting that through our distribution probably more in 2021 and that brings the point that you're asking which is Texas makes on.
They were a bit overweight in my opinion in Dallas that rate increases.
Over approximately 60%.
The policies that are actually renewal renewing our approximately 45%. So what we're finding is that test is being cut in half rapidly continues to be so each and every day you have to premium rate remains relatively stable. So we're committed to those markets, including Dallas, where we can get.
Paid for there for the rest so I don't think.
I don't think you're going to see.
Much growth what makes on as we recalibrate some of the programs that they have the rates the rules. The forums, we integrated into our operations, which is going well I really don't think you're going to see much growth in 2020.
But I think makes on has a great opportunity to grow in 2021.
And these in these three states that they operate.
Okay, great so that kind of but those together what I'd be right in saying that of the strong growth in Texas. The bulk of it is.
Coastal in nature, USAID shore and that.
Really what happened it makes on as more.
I think if it kind of holding serve through a lot of rate increase and we'd see pits and therefore.
Cat exposure in places like Dallas decline.
Absolutely spot on Dallas is going to become much less meaningful for us.
Unless we can get paid west we feel appropriate same store is much more the first 100 200 miles from the coast, which is much more consistent with our strategy elsewhere, we find that our cat scans actually is more efficient because thats more similar to the exposures that we write in or other states, including Louisiana.
<unk>.
Mississippi, Florida, all the way up to South Carolina, so spot on.
Great.
Thank you for the answer is that the like.
Thanks, Matt they want.
Yes as it.
As a reminder to ask a question you will need to press star one on your telephone.
Your next question comes from Doug Ruth from Lenox Financial services.
Good morning could you give us some additional commentary about what's happening in Florida.
Yes, Doug good morning.
In terms of Florida.
It's an interesting marketplace.
And it has been for a number of years, it's approximately $10 billion market and I would say the Florida domestic carriers represent about 65% to 70%.
But I would say that its hardening very quickly because some of those that I'm too aggressive in pricing.
Having to deal with the implications on the ramifications of that.
In terms of US specifically, we're bullish on Florida at the right time.
So our policy count is down significantly within Florida from a high three four years ago of 285000 policies.
We're at about 230000 policies now and I will say by the year end of Twentytwenty data it will be lumber it might be in the 200 to 220000 range.
So our premiums should stay relatively flat in Florida at about 440 million. However, our policy count and our T. I'd be which is our total insured value will be down significantly and the reason for that is we're not being paid the correct rate Theres continued pressure on the Attritional losses.
We have a 7.4% rate filing that was filed in January.
We have verbal notification that.
It is going well, we anticipate written approval shortly and expect to deploy that in June.
After that we will be having a rate filing that will go in to recover any reinsurance pricing.
That does happen at mid year.
And of course will be a lag as it earns out but I believe that we'll have that rate increase whatever it may be let's just say theoretically it might be five six points. The actuaries have their work to do yet.
And then that hopefully will be in line for October.
So as we get on to the other side of Hurricane season.
I think our book will be more adequately priced.
But I think.
Additional rate may be needed.
So we do have another rate filing.
Planned for the fall and that math, we don't have yet we're continuing to evaluate our attritional losses were continuing to evaluate litigation on of the benefits. So they will be reform.
So I would not anticipate growth from us.
And so perhaps Q4, but more likely.
As we get to year end.
Into the beginning of 2021, perhaps January of 2021.
And I think theres, a great opportunity to grow if we so desire I believe with those rate increases and with.
The pressures felt not just by us, but by 90 I.
I think that those those those prices that I just spoke on those increases will remain competitive.
We are absolutely apart into our agents they want to place that business with us.
So we're just going to wait until the correct time to write that business.
Is the Florida pork profitable at this level now.
That's a tough tough to answer because basically the way we look at is on a go forward basis. So when we when you look backwards on what the rate increase.
The data yeah, it would need.
To satisfy the state with a 95 combined approximately 7.4%.
So once that gets in with that data in a flat world that would tell you that it should be profitable as those policies are now.
With increased cash costs that it's like a staircase. It's another step that we have to take so so we'll be incurring that expense before the premium will be in so there is a bit of a lag and that's why I say, we were continuing to restrict new business and contract that book until the rates are correct.
Just to jump in on that one this is Ron.
Absolutely here in the first quarter. Despite the weather that came through both our Florida and non Florida books produce positive earnings.
Our debt that's helpful look the other the other thing would be is the stock is under the radar. It would really help if the the management team and the board of directors word.
Be able to consider buying some stock with their own body it would.
We get additional people to recognize.
What's going on you folks are we we've been patient and we've been.
I'll, let you do what you what you think is right, but it would show US that you really believe in the business plan. If you were to buy from stock with your with your own money I would like to encourage you to consider doing that.
Yeah, Doug well set and you'd represented that in the past and.
Once again I'll share that with the board, but we do believe in what we're doing it's it's been a bit of a challenge the last three four years.
The challenge has been one after another within Florida.
And it's hard to believe that we've already taken rates up 25% incrementally over the last three four years.
And here I am saying, we may need another 15 to 20.
So there is a challenge we're happy with our plan in Florida, We feel we've done the right thing by pivoting our growth outside of Florida.
We think the economics makes sense and we look for that opportunity to grow inside Florida as well.
Okay, well, thank you and best of luck.
Yes, Thank you Doug.
Okay.
There are no further questions at this time I would like to turn the conference back over to Mr., Mike Brosnan, Fednat Fed Nat Chief Executive Officer.
Thank you all for participating on today's call before we close I want to once again banking showcase our fed Nat community, our staff partner agents policyholders and beyond our team has risen to the occasion delivering best in class solutions to our customers and exhibiting resilience and flexibility in the process.
This collaborative ecosystem well positions us to continue to drive improved financial results for the balance of 2020, and our strong partner agent network and increase brand recognition fuels that performance our first quarter results in the successful execution to date of our non Florida expansion strategy.
Demonstrate success.
Not continues to maintain or strong balance sheet and capital position, which will further enable us to build value and return capital shareholders. As we navigate through this time, we remain committed to excellent service stringent underwriting and organically growing our presence in our more profitable markets. So with that thank you very much right.
And I are always available if there's any follow up questions and hopefully all stay well and healthy during the pandemic and we remain committed to serving our policyholders and all of our stakeholders. Our shareholders are very important to us. So thank you.
Ladies and gentlemen. This concludes today's conference. Thank you for participating you may now disconnect.
Okay.
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