Q1 2021 American Financial Group Inc Earnings Call
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Good day, and thank you for standing by walking the American financial group for any to any one first quarter results conference call. At this time all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session to ask a question and during detection.
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President Investor relation Ms. Diane Weidner. Please go ahead.
Thank you Qi now good morning, and welcome to American Financial Group first quarter 2021 earnings result Conference call. We released our 2021 first quarter results yesterday afternoon, Our press release Investor supplement and webcast presentation are posted on Afg's website under the Investor Relations section.
These materials will be referenced during portions of today's call.
I'm joined this morning by Carl Lindner, the third and Craig Lindner Co Ceos of American Financial Group, and Brian Hartman, Afg's CFO before I turn the discussion over to Carl I would like to draw your attention to the notes on slide two of our webcast and some of the matters to be discussed today are forward looking these forward looking statements involve certain risks and.
And D that could cause actual results and or financial condition to differ materially from these statements. A detailed description of risks and uncertainties can be found and afg's filings with the Securities and Exchange Commission, which are also available on our website.
We may include references to core net operating earnings and non-GAAP financial measure and our remarks or in responses to questions and a reconciliation of net earnings attributable to shareholders to core net operating earnings is included in our earnings release and finally, if you are reading a transcript of this call. Please note that it may not be authorized or reviewed for <unk>.
<unk> and as a result, it may contain factual or transcription errors that could materially alter the intent or meaning of our statement.
Now I am pleased to turn the call over to Carl Lindner, the third to discuss our results.
Good morning, we released our 2021 first quarter results yesterday afternoon.
Please turn to slide three of the webcast slides for and overdue.
And as previously announced the results from our annuity operations were reported as discontinued operations beginning in the first quarter of 2021 and prior periods have been adjusted accordingly to present results on a comparable basis.
And if she reported core net operating earnings of $2.38 per share and impressive 75 per cent increase share every year.
The increase was due substantially to substantially higher underwriting profit and our specialty property and casualty insurance operations and higher property and casualty net investment income.
Our significantly improved results from the company's one and a half billion dollars of alternative investments that are mark to market through core operating earnings were partially offset by lower other property and casualty net investment income primarily due to lower short term interest rates.
Annualized core operating return on equity and the first quarter was a strong 14.7%.
Turning to slide for you'll see that the first quarter 2021 net earnings per share of $4.84 included 70 cents per share and after tax non core net realized gains on securities and a dollar and 76 cents per share and earnings from our discontinued annuity operations.
Craig and I Thank God.
Our talented management team and our employees for helping us to achieve these results and position our business for continued success.
Based on the strong results reported through the first quarter. We now expect Afg's core net operating earnings and 2021 to be and the range of $7 to $8 per share and increase from our previous guidance of $6.25 to $7.25 per share and she'll.
As seen on slide five this guidance range excludes earnings from our discontinued and annuity operations that will be sold and mass mutual and continues to assume zero earnings on parent company cash, including the expected net cash proceeds from the sale day annuity operations as we continue to consider.
Total for deployment of the sales proceeds.
The year's off to a great start and we're pleased to increase our 2021 core earnings per share.
Guidance and a meaningful way.
This guidance excludes non core items, such as results of discontinued operations realized gains and losses and other significant items that are not able to be estimated with reasonable precision or that may not be indicative of ongoing operations. Furthermore, the above guidance reflects a normal crop year.
And an annualized return of approximately 8% on alternative investments over the remaining three quarters of 2021.
Craig and I will discuss our guidance for each segment of our business and more detail later in the call.
Now I'd like to turn our focus to our property and casualty operations.
Please turn to slide six and seven of the webcast, which includes an overview of the first quarter results.
And you'll see on slide six the specialty property and casualty insurance operations generated an underwriting profit on.
$134 million and the 2021 first quarter compared to $89 million from the first quarter of 2020 and increase of 51%.
Well on each of our specialty property and casualty groups produced higher year over year underwriting profit. The increase was primarily due to higher underwriting profitability and our property and transportation group.
The first quarter 2021 combined ratio was a very strong 88.5%.
Improving 3.7 points from the 92.2% reported and the comparable prior year period.
Results for the 2021 first quarter.
Include 1.7 points in catastrophe losses, and 5.2 points of favorable prior year Reserve development.
Catastrophe losses, net of reinsurance and including reinstatement premiums for $31 million from the first quarter 2021 primarily the result of winter storms in Texas.
By comparison catastrophe losses.
For $9 million and the prior year period.
We continue to carefully monitor claims and loss trends related to the COVID-19 pandemic noon.
Numerous legislative and regulatory actions as well as the specifics of each claim contribute to a highly fluid evolving situation.
AFG recorded an additional $9 million and reserve charges related to COVID-19, and the first quarter of 2021 primarily related to our workers compensation businesses.
And we released approximately $6 million of accident year, 'twenty 'twenty COVID-19 reserves based on loss experience.
Given the uncertainty surrounding the ultimate number and scope of claims relating to the pandemic.
Approximately 69% of the.
$98 million and Afg's COVID-19 related reserves are held as incurred but not reported at March 31, 2021.
For our claims professionals and knows who support them are working tirelessly to review claims for the care and attention each deserves.
Now turning to pricing, we continue to see strong renewal rate momentum and achieved broad based pricing increases and a quarter with exceptionally strong renewal pricing and our longer tail liability businesses outside of workers' comp.
Average renewal pricing across her and her P&C group, including Workers' comp was up approximately 12% for the quarter.
Excluding our workers' comp business renewal pricing was up approximately 16% and the first quarter for.
Pleased to see this continued strong renewal rate momentum, which is enabling us to achieve rate in excess of loss costs and nearly every one of our specialty property and casualty businesses with the exception of workers' compensation.
And our overall increases its relatively unchanged from the rate increases achieved and the fourth quarter of 2020.
Gross and net written premiums for the first quarter of 2021 were up <unk>.
6%.
And 3% net written premiums.
Respectively, when compared to the first quarter, 2020 with healthy year over year growth reported within each of the specialty property and casualty groups.
Excluding workers comp gross and net written premiums grew by 9% and 7% respectively year over year.
Now I'd like to turn to slide seven to review a few highlights from each of our specialty property and casualty business groups.
Property and transportation group reported an underwriting profit of $56 million and the first quarter of 2021 compared to $27 million from the first quarter of 2020 huh.
Higher underwriting profits and our transportation property inland marine and crop businesses were the drivers of the euro per year increase.
Catastrophe losses, and this group net of reinsurance and including reinstatement premiums were $22 million from the first quarter of 2021 primarily the result of the winter storms in Texas.
First quarter 2021 gross and net written premiums from this group for 5%, 4% higher respective weighted on the comparable prior year period with growth reported and nearly all of the businesses and this group.
Growth came primarily from our agricultural property and and on the Marine and aviation businesses, primarily as a result of higher renewal rates.
Overall renewal rates and this group increased 7% on average for the first quarter of 2021 and with continued strong renewal rate momentum and.
As for crop insurance planning is underway with industry estimates for 2020 one pointed acreage.
And the unchanged up slightly for.
From last year's levels.
Current commodity futures.
Prices for corn, and soybeans for trading approximate 27% and 15% higher respectively than the 2021 spring discovery prices.
Specialty casualty group reported an underwriting profit of $56 million and the 2021 first quarter compared to $52 million and the comparable 2020 period.
Higher profitability, and our excess and surplus wines and excess liability businesses was partially offset by lower year over year prior period favorable reserve development and our workers compensation businesses.
Underwriting profit prop.
Profitability and our workers compensation businesses overall continues to be excellent.
Property and the specialty casualty group reported a very strong 90.2 combined ratio for the first quarter.
Gross written premiums increased 6% and net written premiums were flat when compared to the same prior year period.
Excluding workers' compensation gross and net written premiums grew by 13% and 8% respectively year over year.
With the exception of workers' compensation and nearly all the businesses and this group achieved strong renewal pricing and reported premium growth during the first quarter.
Significant renewal rate increases and strong renewal retention contributed to higher premiums and our excess liability businesses.
Which have higher sessions and then other businesses and this group.
Eric executive liability and mergers and acquisitions liability businesses also contributed meaningfully to the year over year growth.
These increases were partially offset by lower year over year premiums and our workers' compensation businesses, which were primarily the result of lower renewal rates.
Catastrophe losses for this group were about $2 million and the first quarter of 'twenty, one and less than $1 million and last year's prior year period.
Renewal pricing for this group was up 15% and the first quarter.
And excluding our workers' compensation businesses renewal rates and this group were up a very strong 25%.
Specialty financial group reported an underwriting profit of $25 million and the first quarter of 2021 compared to $17 million and the first quarter of 2020.
Higher year over year underwriting profit and our financial institutions business was the primary driver of the increase.
This group, but she continued to achieve excellent underwriting margins and reported and 84.1 combined ratio for the first quarter 2021.
Catastrophe losses for this group net of reinsurance and inclusive of reinstatement premiums for $6 million from the first quarter of 2021 compared to $1 million from the prior year quarter.
Gross and net written premiums increased by 5% and 8%, respectively, and the 2021 first quarter when compared to the prior year period.
Do business opportunities.
Coupled with growth and accounts with higher retentions within our lender services businesses.
Contributed to the increase in the quarter.
Renewal pricing in this group was up approximately 8% for the quarter.
Now please turn to slide eight for a summary view of our 2021 outlook for the specialty property and casualty operations.
This year is off to a very strong start where the first quarter specialty property and casualty combined ratio under 89% and.
We continue to expect a 2021 combined ratio for the specialty property and casualty group overall between 89 and 91% for the full year.
Net written premiums are now expected to be 7% to 10% higher and the $5 billion reported in 2020.
And improvement from the range of 5% to 9% estimated previously.
And now growth and net written premiums excluding workers' comp is now expected to be and the range of 9% to 12% and increase from the range of 6% to 10% estimated previously.
Looking at each segment, we continue to estimate a combined ratio and the range of 88% to 92% our property and transportation group.
Our guidance assumes a normal level of crop earnings for the year.
We now expect growth and net written premiums for this group and the range of 13% to 17%.
Our net written premium guidance is based on projected strong growth and our crop operations as a result of higher spring commodity futures pricing and assumes double digit growth and our commercial auto businesses during the year.
And we continue to expect our specialty casualty and group group to produce a combined ratio and the range of 87% to 91% and 2021.
Our guidance assumes continued strong renewal pricing and our E&S excess liability and several of our other longer tail liability businesses.
We expect net written premiums to be 2% to 5% higher than the 2020 results.
Premium growth will be tempered by rate decreases and our workers compensation book.
Which are the result of favorable loss experience and this line of business.
So excluding workers' compensation, and we expect 2021 premiums and this group to grow and the range of 5% to 9%.
And the specialty financial group combined ratio is now expected to be and the range of 86% to 90%.
We expect net written premiums in 2020, one to be 7% to 11% higher and 2020 results.
The improved outlook.
Is primarily the result of stronger underwriting results and stronger projected premium growth and our financial institutions business.
With regard to pricing, we expect overall property and casualty renewal rates to be up 8% to 10% and excluding comp that would be and the range of 10% to 12%.
As indicated by the continuing pricing momentum that we saw through the first quarter 2021.
I'll now turn the discussion over to Craig to review Afg's investment performance and the impending sale of the annuity business.
Thank you Carl.
The details surrounding or a 13.9 billion dollar investment portfolio for continuing operations are presented on slides nine and 10.
AFG reported first quarter 2021, net realized gains on securities of $61 million after tax.
Approximately $53 million of the after tax realized gains pertained to equity securities that AFG continued to one at March 31 2021.
Pretax unrealized gains on Afg's fixed maturity portfolio were $240 million at the end of the first quarter.
We're especially pleased with the performance of our alternative investments during the quarter.
Earnings from alternative investments may vary from quarter to quarter based upon the reported results of the underlying investments and generally are reported on a quarter lag.
The annualized yield on alternative investments reported and core operating earnings and the first quarter of 2021 was 28, 6%.
The average annual return on these investments over the past five calendar years was approximately 10%.
We view, our investments and real estate and real estate related entities as a core competency and.
In addition to our portfolio of directly owned properties and mortgage loans and a real estate related investments include real estate funds and real estate partnerships accounted for by the equity method.
We've found great success, and investing and multifamily properties and desirable communities, where we continue to achieve very strong occupancy and collection rates.
As you can see on slide 10, our investment portfolio continues to be high quality with 87 per cent of our fixed maturity portfolio rated investment grade.
In addition, the percentage of fixed maturity investments rated non investment grade by the NTIC remains at less than 3% of total fixed maturity investments at March 31 2021.
We continue to make great progress toward the closing of the sale of our annuity businesses to mass mutual and the highlights of which are included on slide 11.
Under the terms of the agreement the purchase price of $3 $5 billion is subject to final closing adjustments to the extent that GAAP shareholders' equity excluding OCI of the entity sold.
There is from $2 $8 billion.
GAAP shareholders' equity excluding OCI of the entities to be sold was $3 billion at March 31 2021.
We now expect to recognize and after tax gain on the sale of $680 million to $700 million or $7.85 to $8.10 per AFG share.
And when the sale closes which is expected to occur and the second quarter of 2021.
In addition, prior to completion of the transaction Afg's P&C group will acquire approximately $460 million and real estate related partnerships and.
AFG parent will acquire approximately $100 million and directly owned real estate from Great American life insurance company.
Updated pro forma financial information is provided on slide 12 and.
Illustrates how the transaction will significantly enhance afg's excess capital and liquidity.
On a pro forma basis Afg's parent cash as of March 31, 2021 was $3 $8 billion and excess capital increased from the $1 $2 billion reported at March 31, 2021, two and estimated $4.5 billion.
Approximately $2 billion of the estimated for and a half a billion dollars of pro forma excess capital will be available for return to shareholders and a form of special dividends and our share repurchases without violating our commitments to rating agencies or exceeding our debt to capital targets.
AFG parent is expected to have approximately $45 per share and cash immediately following the closing of the sale of the annuity business.
As for use of proceeds and we continue to evaluate opportunities for deploying afg's excess capital and review options that provide the best opportunity to create long term value for our shareholders.
Alternatives include the potential for share repurchases and special dividends and opportunities to grow our business through healthy profitable organic growth and expansion of our specialty property and casualty and niche businesses through acquisitions and startups that meet our targeted return thresholds.
I would like to personally thank all of our talented and dedicated annuity associates and the annuity and a F. G leadership teams, who have worked tirelessly to ensure a successful transaction and an orderly transition of the annuity business.
I will now turn the discussion over to Brian who will discuss afg's financial position and share a few comments about afg's capital and liquidity.
Thank you Greg Please turn to slide 13, where you will find a summary of Afg's financial position at March 31, 2021 we.
We repurchased $192 million of AFG common stock during the quarter and the average price per share of $108 and 98.
Share repurchases, especially when executed and attractive valuations are and important and effective component of our capital management strategy.
During the quarter and addition to the share repurchases, we returned $43 million to our shareholders for the payment of our regular <unk> 50 per share quarterly dividend.
Annualized growth and adjusted book value per share plus dividends was a strong 23, 8% during the first quarter.
Our excess capital was approximately 1.2 billion at March 31. This number included included parent company cash of approximately $200 million as a reminder, we define excess capital as the sum of one and company cash excess capital within our insurance subsidiaries and.
And borrowing capacity up to a debt to total adjusted capital ratio that ensures we maintain our commitments to rating and disease.
We expect to continue to have significant excess capital and liquidity through our 2021 and beyond specifically our property and casualty insurance companies are projected to have capital in excess of the levels expected by ready and season in order to maintain their high current ratings and we have no debt maturities before 2026.
I would also like to take a minute to talk about holding company expenses, which are impacted by changes and the liability for employee benefit plans and their titles dark market and both for first quarter of 2021 and 2020 a.
The significant declines on the stock market, including AFG common stock and the first quarter of 2020 reduced our liabilities under these plans and favorably impacted holding company expenses by about eight and a half million dollars. Conversely, very strong performance by our stock and the overall stock market and the first quarter of 2021 increased our liabilities under these plans.
And adversely impacted net income the expenses by about $9 million and a more normalized stock market environment. These expenses and are less volatile with an estimated run rate that is $5 million or so better than the current quarter. We will now open the line for questions.
Okay. So as a reminder to ask a question you will need to press star one on your telephone to is all your question and perhaps Stefanki again that a star one on your telephone please standby, while we compile the Q&A roster.
First question comes from the line of fall and use some from Piper Sandler you were and our lives.
Good morning, and congratulations on the quarter.
I was hoping to.
And maybe just give us a little color on them.
And what's going on from a.
Benefits right on the top.
Off line in the property casualty business versus.
Some sort of sense of policy in force obviously.
You have a lot of different products with a lot of different.
Structures, but.
It's tough to tell it from.
What's happening here is almost entirely rate or if there is some.
Our market share gains.
Coming through as well and and maybe just kind of talk about sort of the pieces and thereof.
And as we look forward.
Yeah. This is Carl.
I think primarily on the first quarter, it's being driven by rate and renewal attention you know overall.
Renewal retention.
But yeah, we have 30 for different businesses. So.
You know, we do have businesses where.
We are picking up a policy count or for accounts and that.
So.
You know were written.
Just curious to see if we can there's a lot of activity and.
And similar lines of urea and <unk> in terms of new folks trying to come in and.
And there's leaving and it doesn't look like you're sort of much of a net shift and industry.
With respect to.
Actual participation is that fair or is it somehow.
And I really see I don't think.
You know the competitive environment today with regards to new entrants as any different than any other year.
I mean, the markets you know when you're operating in 34 different markets. The markets are fairly fluid there is some consolidation.
You know within the industry and when that happens and others.
And there's always some shake out you know of accounts and and agents and with agents and brokers and that type of thing.
And you always have a you know markets.
Pulling back or.
Moving out of.
Some of those 30 for market so.
I think I see it really kind of being.
Neutral or you know really no no change from the normal environment.
And that we operate and then.
Great. Thanks, and I'll, let some other folks ask question I appreciate the color. Thank.
Thank you very much.
Alright, so for the next question we.
And we do have Greg Peters from Raymond James Your and our lives.
Good afternoon, and thank you for letting me ask questions.
So.
If I look at the specialty property casualty business the.
And the expense ratio for the group.
Improved pretty.
Pretty nicely last year, I think it was 34% versus 32.2 per cent for the full year and then if I look at the first quarter results. The expense ratio for the group improved again, a 31.7 versus 33.7, a year ago. So it's a 200 basis point improvement and on top.
Of almost 200 basis point improvement that you generated last year.
So Carl I was wondering if you could give us some ideas of what's going on on the expense side are you what initiatives do you have in place to drive this type of improvement as this subset sustainable and should we be thinking about these types of improvements going forward.
Hi, Greg This is Brian Hurts bin Thank you for the question.
Looking at the first quarter of 2021 versus the first quarter of 2020.
And I kind of go through it by sub segment and the property and transportation and sub segment.
We had higher profitability based ceding commissions from our reinsurers and our crop business. So that wasn't a positive impact on the ratio. We also had some growth a higher premiums and the aviation business. So that was helpful as well and especially casualty sub segment and we had.
Growth and our excess and life excess liability and mergers and acquisitions businesses. Those businesses also have a profitability based ceding commissions that we had a higher ceding commissions and those businesses and and especially the financial.
And we had higher premiums, particularly on our innovative markets business.
And then.
And so really overall, we're just seeing impacts of growth and adding and improve profitability.
Far as going forward goes we're always a prudent manager of our expenses and keeping an eye on things. We know we're still getting some benefit of of where were at lower travel and entertainment and we'll look to ways to to keep that moving forward and obviously with the.
Rate increases that we're getting and the growth and the business as the fixed portion of our expenses I will continue to benefit from that as long as we have that that continued growth that we're expecting and the nice rate increases.
That's great color.
And a follow up to another on one of the prepared comments.
I think you said and I I'm mistaken if I got this wrong.
Correct Me I'm sure, but I think you said <unk>.
Excluding our workers' comp pricing goes up.
10% to 12% across the book of business, and then and I think you've guided to ex workers' comp for specialty property casualty premiums to be up 9% to 12 per site. So I, if I got those numbers wrong I'm sorry, but.
What I'm driving at here is I'm.
I'm just curious about.
The balance between rates that youre, getting and actually new business units for new new policies and I was just wondering for some perspective on that.
Well first of all on it and the first quarter overall, excluding workers' comp.
Our prices were up 16%.
And that's pretty much you know the fourth quarter was about 17%. So really you know we're poised really wasn't much.
The difference on that.
And our guidance, we're guiding to 10% to 12% excluding comp.
And that that moved up.
From our previous guidance, but the reason for the difference we think and.
And as I mentioned and are in the last earnings call that I believe that when we get to.
You know second or a third renewals on some of the business that's been achieving a 20% to 50% rate increases I don't think we're going to get the same 20% to 50% type of rate increase on top of what we've already gotten so.
And you know when that.
And it it's just yeah.
I think the reality of our business and our case, our you know our overall rates are.
Very adequate and per our underwriting profitability and.
You know I I, just don't think once maybe the second half for the year you know hit.
Hits.
And that we're going to get some of the same size of price increase that we've been getting before so that's that's the difference I think I already commented on.
You know, where our where our growth is coming from as it relates to our you know renewal renewal pricing strong retentions and and <unk> and some of our 34 businesses, we are growing policy count.
But and.
You almost have to go through business by business, and we don't really disclose that data.
Fair enough. Thank you for that answer I guess, the last question I have.
It would be from slide 11 on the sales the annuity business and I know I asked this last quarter and so I just pardon me I'm just trying to work through the mechanics for the accounting but.
Let's see what's the on the business, that's being sold what's the GAAP shareholders' equity, including a <unk>.
Oh, Ci and when I look about that estimated after tax gain is that X a O C. I R, including a O C. I am just try I'm just trying to understand and mechanics are thank you.
So on the army as the ideas the I will go away as part of that transaction. So it's kind of it's it's more or less and embedded in the gain for the game is pretty much as straightforward as theyre paying us three and $5 billion for them.
For shareholders equity of $2 8 billion, the expenses and tax consequences related and transaction are a relatively small.
Looking at the the.
Equity and the business ex OCI is $3 billion.
ACI in that business and is mostly related to unrealized gains on fixed maturity securities that go away as part of the transaction and that that number is about $800 million, though it is its decline. The unrealized has declined and the ACI has declined because of the unrealized by about $270 million since year end, but that.
It doesn't have any effect on the gain or on the proceeds or anything else. So.
From a total shares equity perspective, its pretty much.
More of a wash, but it but as we said last time, we talked about this and I see I part really isn't affecting that isn't really affecting the economics of the transaction for us.
From an income statement perspective more from a what we would consider R. R.
More real capital, especially with the leverage and the annuity portfolio and those unrealized members can move all over the place and unless you are selling the security the outright.
And they don't necessarily matter that much as you can see a 270 million dollar change and the NCI bounds didn't affect anything to do with the transaction or for how we look at the business and hopefully thats helpful.
It is helpful, Brian and thank you and.
And I'll, let others ask questions.
Okay.
Alright, So again, if you would like to ask a question. Please press star one on your telephone.
Next question comes from the line of claims back from K D. W. You are and our lives.
I. Thank you and good afternoon I had a quick question on the pace of recovery for the transportation business, particularly speaking to the <unk>.
<unk> exposures on wise.
Sure.
Well I think you know.
And when you look at our premium guidance for the property and transportation group.
And <unk>, increasing 13% to 17% and.
No my comment about.
And our commercial auto business growing double digit.
You know I think a it's it's kind of tracks with what we feel you know the economic recovery is going to be as more vaccines.
And 60.
60, 70 per cent of the country gets vaccinated by July and things get back more to normal we had a very had a very strong premium month in March.
And our commercial auto business and that caused us a along with the improving economy to them.
To you know.
I'd be very optimistic about our growth and our commercial auto business. So.
We've had excellent profitability for.
The last couple of years and you know in the first quarter and our commercial auto business and still getting.
On a pretty significant rate as the loss loss costs loss ratio trends.
You know and that part of our business continue to be higher than our average.
And that but yeah, Barry I'm very pleased with the prospects are for both profit and growth.
And can you speak to the broader loss trend and what changes you may be seeing going forward for.
For the full and the whole insurance business.
Sure.
Our overall afg's overall loss ratio trend is about one 1.9%.
Excluding workers' comp.
That's $3 four per cent.
And that.
And loss ratio trend you know.
And is loss cost trend plus any positive out offsets for.
You know the growth and exposure units net type of thing.
The 1.9% you know I would point you to the 12% and price increase that we got on the first quarter of 2021 and so obviously you know, we're achieving above a rate above or loss ratio trend and.
And I might point, you to the 16% excluding.
Excluding workers' comp and price now.
And now that we got and the first quarter as compared to the free 0.4% loss ratio trend.
Uh huh.
Clearly you know some of the social inflation.
Impacted businesses like excess liability and exact and our D&O business and commercial auto liability those would be the the businesses, where you know loss ratio cost and loss ratio trends.
Our our higher within our book of business.
And just a final question for Workers' comp do you have just wanted to get a sense of the frequency expectations as the economy recovers.
And on Workers' comp.
And our current loss ratio trend is overall down down and you know is overall down about 1%.
Our frequency you know continues to be a down you know roughly a 1% or so.
So you know our overall loss cost trend is kind of flat to 1%. So.
And so we continue to see pretty stable.
<unk>.
Loss cost trends and the loss ratio trends and that business.
Thank you that covers it all for me.
Alright, and there are no further questions at this time I will now turn the call over back to Ms. Diane Weidner for closing remarks.
Okay.
Thank you all for joining US this morning to review, our first quarter 2020. One resolved we look forward to talking with you again as we share highlights from our second quarter hope.
I Hope you all have a great day.
This concludes today's conference call. Thank you for participating you may now disconnect.
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