Q4 2023 Investor Presentation
Investor Presentation
2023 Fourth Quarter
© 2024
ClickInformationalto edit MasterStatementsti le style
The Private Securities Litigation Reform Act of 1995 ("PSLRA") provides a "safe harbor" for forward-looking statements. This release or any other written or oral statements made by or on behalf of
This presentation may contain non-GAAP financial measures as defined by Regulation G of the rules of the
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ClickSpecialtyto edit MasterInsurancetitleBusinessesstyle
Arch operates leading specialty insurance lines across a wide range of geographies
and products
Total Gross Premiums Written
FY 2023
Gross Premiums Written by Segment
From 2018 to 2023 ($M)1
8%
Mortgage
49%
1,361
1,913
3,262
1,466
2,323
3,908
1,474
3,472
4,689
1,387
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1,455 |
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9,113 |
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1,508 |
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6,948 |
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5,094 |
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7,911 |
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6,931 |
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5,868 |
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43%
Insurance
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2018 |
2019 |
2020 |
2021 |
2022 |
2023 |
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Insurance |
Reinsurance |
Mortgage |
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1 Certain amounts included in the gross premiums written of each segment are related to intersegment transactions and are included in the gross premiums written of each segment. Accordingly, the sum of gross premiums written for each segment does not agree to the total gross premiums written as shown in the table above due to the elimination of intersegment transactions in the total.
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ClickCreatingto editShareholderM ster title styleValue Throughout The Cycle
Generate
Superior
Risk Adjusted
Returns
Thorough risk assessment of underlying exposures
Align executive compensation with long term performance
Dynamic capital
allocation
Focus on
Underwriting
Talent intensive,
not people
intensive
Specialty lines
platforms
Active cycle
management
Conservative
Balance Sheet
Minimize
investment risk
Cautious reserving philosophy
Low financial leverage and strong liquidity
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ClickConsistentlyto editMasterSuperiortitleRiskstyle-Adjusted Returns
TVC CAGR (YE:03-YE:23)
Strong track record of generating higher, more consistent risk-adjusted returns
Total Value Creation vs. Coefficient of Variation - Total Composite
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Lower Volatility, Higher Returns |
Higher Volatility, Higher Returns |
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16% |
Arch has 2x the average value |
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creation of the industry and |
Industry Mean |
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81% of the average volatility |
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= 108% |
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14% |
around the industry average. |
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12% |
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American Fin'l |
Markel |
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10% |
Re |
Chubb |
Industry Mean |
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Renaissance Re |
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Fairfax |
= 7.3% |
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8% |
Axis |
Capital |
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6% |
Mercury |
Gen'l |
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Fin'l |
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4% |
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Lower |
Volatility, Lower |
Returns |
Higher Volatility, Lower Returns |
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2% |
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25% |
50% |
75% |
100% |
125% |
150% |
175% |
200% |
Coefficient of Variance (Standard Deviation of Annual TVC / Mean)
Source: D&P Analysis. Chart represents Total Value Creation, which includes Tangible book value per share growth plus dividends.
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Property Casualty Segments
Diversification reduces earnings volatility
Insurance Net Premiums Written $5.9B1
FY 2023
Reinsurance Net Premiums Written $6.6B2
FY 2023
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Warranty and |
Other, 8% |
Professional |
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Lines, 24% |
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lenders |
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solutions, 4% |
Marine, Aviation
and Space, 4%
Other, 2%
Excess and
surplus
casualty, 9%
Travel,
accident and health, 10%
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Property, |
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Construction |
energy, marine |
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and aviation, |
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and national |
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21% |
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accounts, 11% |
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Programs, 13% |
Specialty,
Property37%
Catastrophe,
13%
Casualty, 15%
Property, 29%
- Insurance Segment: Professional Lines includes professional liability, cyber insurance, executive assurance and healthcare business. Excess and surplus casualty includes casualty and contract binding business. Other includes alternative markets, excess workers' compensation and surety business.
- Reinsurance Segment: Casualty includes executive assurance, professional liability, workers' compensation, healthcare, Motor XOL and other. Specialty includes proportional motor, cyber, trade credit and surety, accident and health, workers' compensation catastrophe, agriculture, political risk and other. Other includes life, casualty clash and other.
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ClickManagedto edit MCatastrophester title styleRisk
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2,000 |
30% |
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1:250 as a % of Tangible shareholders' equity available to Arch* |
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1,650 |
25% |
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19.4% |
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20% |
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17.0% |
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1,300 |
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$M |
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PML |
14.4% |
15% |
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950 |
10.5% |
10.1% |
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1:250 |
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9.1% |
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8.1% |
9.2% |
10% |
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8.1% |
6.6% |
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8.0% |
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5.8% |
6.9% |
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600 |
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4.2% |
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5.9% |
5% |
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5.7% |
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250 |
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0% |
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- Non-GAAPFinancial Measures: Tangible shareholders' equity available to Arch represents total shareholders' equity available to Arch, which includes non-cumulative preferred shares, less goodwill and intangible assets (excluding amounts attributable to non-controlling interests). We believe that tangible shareholders' equity available to Arch is useful to investors because it provides a more accurate measure of the realizable value of
shareholders' equity. The following table provides a reconciliation of total shareholders' equity available to Arch to tangible shareholders' equity available to Arch:
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Mortgage Segment
Differentiated business model
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Mortgage Segment
Stable growth
Insurance In Force ($B)
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Mortgage Segment
Credit quality remains high
Arch MI
5.5%
5.0%
4.5%
4.0%
3.5%
3.0%
2.5%
2.0%
1.5%
1.0%
0.5%
0.0%
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GSEs announce COVID related |
5.14% |
"Eviction Moratorium"
4.69%
4.19%
3.86%
3.11%
2.67%
2.36%
2.09%
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1.60%1.54%1.45%1.48%1.54%1.42% |
1.77%1.73%1.77% |
1.65%1.74% |
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1.65% |
1.61% |
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As of 12/31/2023, PMIERs sufficiency ratio: 213% - Calculated as available assets divided by required assets as defined within PMIERs;
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© 2024 |
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Attachments
Disclaimer


AM Best Affirms Credit Ratings of Compañía Internacional de Seguros, S.A.
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