Third Quarter 2023 Investor Presentation
INVESTOR PRESENTATION
Third Quarter 2023
Forward-Looking Statements
In this presentation, the Company and its management discuss and make statements based on currently available information regarding their intentions, beliefs, current expectations, and projections of, among other things, the Company's future performance, economic or market conditions, including the evolving nature of the COVID-19 pandemic, current levels of inflation, changes in interest rates, labor market expectations, catastrophic events or geo-political conditions, legislative or regulatory actions or court decisions, business growth, retention rates, loss costs, claim trends and the impact of key business initiatives, future technologies and planned investments. Certain of these statements may constitute "forward-looking" statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts and are often identified by words such as "may," "will," "could," "would," "should," "expect," "plan," "anticipate," "target," "project," "intend," "believe," "estimate," "predict," "potential," "pro forma," "seek," "likely," or "continue," or other comparable terminology and their negatives. The Company and its management caution investors that such forward-looking statements are not guarantees of future performance. Risks and uncertainties are inherent in the Company's future performance. Factors that could cause the Company's actual results to differ materially from those indicated by such forward-looking statements include, among other things, those discussed or identified from time to time in the Company's public filings with the
Filings with the
The Company's filings with the
© 2023 EMPLOYERS. All rights reserved.
EMPLOYERS® and America's small business insurance specialist® are registered trademarks of
|
2 |
EMPLOYERS®
Business Overview
Who We Are (the Numbers)
EMPLOYERS® is a mono-line writer of workers' compensation (WC) insurance
focused on low-to-mediumhazard risk small businesses.
MARKETS AND DISTRIBUTION
Gross Written Premiums
as of
Low-to-Medium Hazard Focus
Shown as a percentage of
|
94% |
6% |
|
Hazard Groups |
Hazard Groups |
|
A-E (lower risk) |
F-G (higher risk) |
Premium Contribution
Specialty
Agents,
Distribution
Partners
Traditional and DTC
Insurance33%
Agents
67%
In-force Premium
at
126,120 in-force policies
Nationwide Platform
as of
Who We Are (the Words)
Over 100-year operating history
Strong underwriting focus with established presence in attractive markets
Record number of policies in-force, excellent operating ratios
Unique, long-standing strategic distribution relationships
Conservative risk profile and prudent capital management
Solid financial position and strong balance sheet
UNIQUE GROWTH DRIVERS SPECIFIC TO EMPLOYERS
Transforming how small businesses and insurance agents utilize digital capabilities to improve their customer experience
- enhancing the agent experience and agent
efficiency
(ii) providing direct-to-
customer workers'
compensation insurance policies through our Cerity brand, which was developed to meet the needs of small businesses seeking an online experience
What We Write
|
Top Ten Employer Classifications |
% of Premium |
|
Restaurants & Other Eating Places |
19% |
|
Traveler Accommodation |
7% |
|
Automobile Dealers |
4% |
|
Automotive Repair and Maintenance |
4% |
|
Services to Buildings and Dwellings |
4% |
|
Offices of Physicians |
3% |
|
|
3% |
|
Schools |
3% |
|
Other Store Retailers |
3% |
|
Wholesale Stores |
2% |
Classes of Business
|
Food & Beverage |
Personal Services |
|
Tech and Scientific services |
Clothing retail |
|
Legal and Financial services |
Personal product retail |
|
Hospitality |
Medical professions |
|
Landscaping services |
Architecture and Engineering |
|
Printing and Publishing |
services |
|
Office, Home and Garden |
|
|
Retail |
|
|
Therapeutic Services |
|
|
Educational |
|
|
Commercial janitorial |
|
|
Plumbing and HVAC |
|
|
Flooring Installation |
|
|
Electricians |
|
|
Painting and Wallpaper |
|
EMPLOYERS® and Cerity® each plan to further expand into other
low-to-medium hazard group classes of business in the future
% of Premium as of
Marketing And Distribution
We market and sell our workers' compensation insurance products through:
- Local, regional, specialty and national insurance agents and brokers;
- National, regional, and local trade groups and associations; and
- Direct-to-customerinteractions.
|
|
Specialty Agents and |
DTC |
|
Agents and Brokers |
|
Direct-to-customer |
|
~67% |
~32% |
~1% |
|
of in-force premium |
of in-force premium |
of in-force premium |
We establish and maintain strong, long-term relationships with our vetted and appointed traditional insurance agencies that actively market our products and services. We offer ease of doing business, provide responsive service, and pay competitive commissions. Our sales representatives and underwriters work closely with these agencies to market and underwrite our business. This results in enhanced understanding of the businesses, the risks we underwrite, and the needs of prospective customers. We do not delegate underwriting authority to agents or brokers.
We had approximately 2,523 traditional insurance agencies that marketed and sold our insurance products at
We have developed and continue to add other important and emerging distribution channels for our products and services including payroll companies, and health care and property and casualty insurers, as well as digital agents and marketplaces.
A meaningful concentration of our business is being generated by our specialty agent
Our digital distribution channel utilizes proprietary application programming interfaces (APIs) to submit, quote and bind applications for workers' compensation insurance. Digital agents generated 5% of our ending 2022 in- force premiums.
To address the changing buying behaviors of small and micro-businesses, we launched Cerity, which offers digital insurance solutions, including direct-to-customer workers' compensation coverage.
Cerity specializes in smaller risks in those classes of business where we believe that customers prefer an online experience and offers a digital and mobile-friendly experience that allows small businesses to easily acquire and maintain their policies.
as of
2022 Workers' Compensation Market
|
RANK |
GROUP/COMPANY NAME |
DIRECT PREMIUMS WRITTEN |
MARKET SHARE % |
|||||
|
1 |
TRAVELERS GRP |
|
6.7 |
|||||
|
2 |
|
|
6.4 |
|||||
|
3 |
AMTRUST FINANCIAL SERV GRP |
|
5.6 |
|||||
|
4 |
|
|
4.8 |
|||||
|
5 |
|
|
4.3 |
|||||
|
6 |
LIBERTY MUT GRP |
|
4.1 |
|||||
|
7 |
BERKSHIRE HATHAWAY GRP |
|
3.7 |
|||||
|
8 |
BCBS OF MI GRP |
|
3.1 |
|||||
|
9 |
STATE INS FUND |
|
2.8 |
|
||||
|
10 |
OLD REPUBLIC GRP |
|
2.5 |
|||||
|
11 |
|
|
2.2 |
|||||
|
12 |
WR BERKLEY CORP GRP |
|
2.1 |
|||||
|
13 |
|
|
2.1 |
|||||
|
14 |
STATE COMPENSATION INS FUND |
|
2.1 |
|
|
|||
|
15 |
|
|
1.9 |
|
||||
|
16 |
ICW GRP ASSETS INC GRP |
|
1.7 |
|||||
|
17 |
CNA INS GRP |
|
1.7 |
|||||
|
18 |
|
|
1.3 |
|||||
|
19 |
ARCH INS GRP |
|
1.3 |
|||||
|
20 |
EMPLOYERS HOLDINGS GRP |
|
1.24 |
|||||
|
21 |
STARR GRP |
|
1.1 |
|||||
|
22 |
MARKEL CORP GRP |
|
1.1 |
|||||
|
23 |
|
|
1.0 |
|||||
|
24 |
ENCOVA MUT INS GRP |
|
0.9 |
|||||
|
25 |
COPPERPOINT GRP |
|
0.9 |
|||||
|
**INDUSTRY TOTAL** |
|
100.0 |
Employers market share increased 12 bps from 2021;
We now rank in the Top 20 in Workers' Compensation writers
|
Source: 2022 NAIC P&C Report |
8 |
Valuation and Comparing Public Comps
(EIG and AMSF are the onlypure-play publicly traded workers' compensation writers)
Price-to-book Ratio
3.00
|
2.50 |
2.82 |
|||||||
|
2.00 |
2.37 |
|||||||
|
1.50 |
Peer Average: 1.70x |
1.58 |
1.71 |
1.62 |
||||
|
1.00 |
1.04 |
1.01 |
1.22 |
1.25 |
||||
|
0.50 |
||||||||
|
0.00 |
||||||||
|
AIG |
EIG |
CNA |
ORI |
HIG |
TRV |
CB |
AMSF WRB |
|
100% Workers' Comp Focused on lowand midhazard accounts
100% Workers' Comp
Focused on highhazard accounts
|
Calculations of Price-to-Book use prices as of the close on |
Source: FactSet |
|
$ in millions
Market Conditions
|
In-Force Policies and Premium |
|||||||||||
|
|
|||||||||||
|
175,000 |
|||||||||||
|
|
|||||||||||
|
|
150,000 |
||||||||||
|
|
125,000 |
||||||||||
|
|
126,120 |
||||||||||
|
|
100,000 |
||||||||||
|
|
85,494 |
BEFORE |
AFTER |
75,000 |
|||||||
|
COVID-19 |
COVID-19 |
||||||||||
|
|
PANDEMIC |
PANDEMIC |
50,000 |
||||||||
|
|
|
|
12/31/20* |
12/31/21* |
12/31/22* |
9/30/23* |
|||||
|
In-Force Premium |
Policies In-Force |
||||||||||
|
* 2020 - 2023 in-force premiums include an estimate of audit premium |
Q3 2023 Update
Reached a record-level of 126,120 policies in-force
# of policies
Attachments
Disclaimer


Lawmakers return to Tallahassee to address Florida issues, DeSantis’ Israel agenda [Miami Herald]
Lawmakers return to Tallahassee to address Florida issues, DeSantis’ Israel agenda [Miami Herald]
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