ProAssurance Reports Results for First Quarter 2024
ProAssurance (NYSE: PRA) reported net income of $4.6 million, or $0.09 per diluted share, and operating income of $4.2 million, or $0.08 per diluted share, for the first quarter of 2024. Key highlights include a 1% decrease in gross premiums written, a 7% increase in new business written, and a strong 8% renewal pricing increase in the medical professional liability business. The consolidated current accident year loss ratio improved by 3 points to 79.9%, and the consolidated combined ratio saw a 2 point improvement to 111.6%. Net investment income increased by 12% to $34 million. Book value per share stood at $21.82 as of March 31, 2024. ProAssurance's management emphasized disciplined underwriting, rate increases, and claims management in a challenging environment, focusing on sustained profitability goals.
Improved results in the Specialty P&C segment and a 12% increase in investment income.
Sequential improvement in the current accident year loss ratio across all operating segments.
Strong renewal pricing increases in the medical professional liability business.
Consolidated current accident year loss ratio improved by 3 points to 79.9%.
Consolidated combined ratio improved by 2 points to 111.6%.
1% decrease in gross premiums written for the first quarter of 2024.
4 point increase in the consolidated operating ratio to 97.7%.
Unfavorable prior accident year development partially offset by beneficial items affecting the Specialty P&C segment.
Insights
The detailed first-quarter 2024 financial results of ProAssurance Corporation exhibit a mixed financial scenario, notable for its moderate growth and improvements in certain key performance indicators (KPIs), alongside persistent challenges. The reported net income of $4.6 million marks a substantial recovery from the previous year's net loss. This positive shift is primarily attributable to a sequential improvement in the current accident year loss ratio across all operating segments and a 12% increase in net investment income.
However, the combined ratio still exceeds 100% at 111.6%, which, although improved from the previous year, indicates that the underwriting operations did not generate an underwriting profit. The consolidated operating ratio showing a 4-point improvement suggests operational efficiency gains, yet the fact that it remains below 100% signals ongoing challenges in achieving underwriting profitability.
Investors might appreciate the strong renewal pricing increases in the medical professional liability business, which could be indicative of ProAssurance's pricing power and strategic discipline in a competitive market. However, the slight dip in gross premiums written, combined with the increase in underwriting, policy acquisition and operating expenses, reflects the cost pressures and competitive challenges the company faces.
The book value per share remaining steady might not excite investors, but the adjusted book value per share increasing albeit marginally, could be seen as a positive sign of intrinsic value growth.
Overall, while the recovery in net income provides a glimmer of hope for improved profitability, the elevated combined ratio and competitive challenges suggest an ongoing need for strategic adjustments to achieve sustainable growth and profitability.
ProAssurance's Q1 2024 results reflect an industry undergoing transformation, with insurers like ProAssurance grappling with both adverse legal environments and a challenging loss environment. The company’s performance in the Specialty P&C and Workers' Compensation Insurance segments provides a lens into broader market dynamics.
The Specialty P&C segment's renewal pricing increase of 7% alongside a retention rate of 86%, suggests effective customer retention strategies, which is critical in maintaining market share within the highly competitive medical professional liability landscape. However, the segment’s slight decline in gross premiums written indicates that the company is not immune to market pressures.
On the other hand, the Workers' Compensation Insurance segment's increase in the net loss ratio to 77.0% from 72.6%, coupled with a combined ratio of 112.3%, raises concerns regarding rising claim costs and premium rate decreases due to state loss cost reductions. Despite a positive increase in traditional business premium, this segment is evidently facing a challenging balance of maintaining competitive pricing while also managing claims costs.
Collectively, these segment performances, when observed against the backdrop of the broader insurance market, suggest a period of recalibration for ProAssurance. The insurer's ability to navigate these challenges, particularly in managing claims and underwriting discipline, will be pivotal in determining its competitive standing and financial health going forward.
First Quarter 2024(2)
-
Gross premiums written:
$311 million 1% ) -
New business written:
$20 million 7% ) -
Strong renewal pricing increases in medical professional liability business (+
8% ) -
Consolidated current accident year loss ratio of
79.9% (3 point improvement) -
Consolidated combined ratio of
111.6% (2 point improvement) -
Net investment income of
$34 million 12% ) -
Consolidated operating ratio of
97.7% , (4 point improvement) -
Book value per share of
$21.82
(1) |
Represents a Non-GAAP financial measure. See a reconciliation to its GAAP counterpart under the heading “Non-GAAP Financial Measures” that follows. |
|
(2) |
Comparisons are to the first quarter of 2023 unless otherwise noted |
Management Commentary & Results of Operations
“Operating earnings this quarter reflected improved results in our Specialty P&C segment and a 12 percent increase in investment income. We are encouraged by the sequential improvement in the current accident year loss ratio across all operating segments. We continue to focus on disciplined underwriting, gaining rate where appropriate and managing claims in a loss environment that continues to be challenging. We are also retaining existing insureds and selectively adding new business at pricing levels that, while reflecting market realities, also helps us make progress toward our sustained profitability goals. We continue to forgo renewal and new business opportunities that we believe do not meet our expectation of rate adequacy in the current loss environment,” said Ned Rand, President and Chief Executive Officer of ProAssurance. He added, “We have not wavered from our belief that our ultimate success in our core lines of insurance - medical professional liability and workers’ compensation - will come about through the conservative strategies we have and continue to implement.”
Our consolidated combined ratio also improved 2.3 points year over year, reflecting the better current accident year loss ratio. In last year’s first quarter, the combined ratio included the impact of unfavorable prior accident year development partially offset by one-time or infrequent beneficial items affecting our Specialty P&C segment’s expense ratio. Our pricing and underwriting discipline in the face of both challenging market conditions and an adverse legal environment has positioned us to build on the progress we saw in underwriting results this quarter.
Book value per share at quarter end was
CONSOLIDATED INCOME STATEMENT HIGHLIGHTS |
|||||||||||
Selected consolidated financial data for each period is summarized in the table below. |
|||||||||||
|
Three Months Ended March 31 |
||||||||||
($ in thousands, except per share data) |
2024 |
|
2023 |
|
Change |
||||||
Revenues |
|
|
|
|
|
||||||
Gross premiums written(1) |
$ |
311,341 |
|
|
$ |
315,794 |
|
|
|
(1.4 |
%) |
Net premiums written |
$ |
282,673 |
|
|
$ |
284,909 |
|
|
|
(0.8 |
%) |
Net premiums earned |
$ |
244,150 |
|
|
$ |
239,787 |
|
|
|
1.8 |
% |
Net investment income |
|
33,897 |
|
|
|
30,310 |
|
|
|
11.8 |
% |
Equity in earnings (loss) of unconsolidated subsidiaries |
|
2,963 |
|
|
|
(1,121 |
) |
|
|
364.3 |
% |
Net investment gains (losses)(2) |
|
(268 |
) |
|
|
2,912 |
|
|
|
(109.2 |
%) |
Other income (loss)(1) |
|
3,955 |
|
|
|
787 |
|
|
|
402.5 |
% |
Total revenues(1) |
|
284,697 |
|
|
|
272,675 |
|
|
|
4.4 |
% |
Expenses |
|
|
|
|
|
||||||
Net losses and loss adjustment expenses |
|
194,694 |
|
|
|
205,296 |
|
|
|
(5.2 |
%) |
Underwriting, policy acquisition and operating expenses(1) |
|
78,005 |
|
|
|
67,788 |
|
|
|
15.1 |
% |
SPC |
|
416 |
|
|
|
532 |
|
|
|
(21.8 |
%) |
SPC dividend expense (income) |
|
607 |
|
|
|
1,942 |
|
|
|
(68.7 |
%) |
Interest expense |
|
5,657 |
|
|
|
5,463 |
|
|
|
3.6 |
% |
Total expenses(1) |
|
279,379 |
|
|
|
281,021 |
|
|
|
(0.6 |
%) |
Income (loss) before income taxes |
|
5,318 |
|
|
|
(8,346 |
) |
|
|
163.7 |
% |
Income tax expense (benefit) |
|
692 |
|
|
|
(2,172 |
) |
|
|
131.9 |
% |
Net income (loss) |
$ |
4,626 |
|
|
$ |
(6,174 |
) |
|
|
174.9 |
% |
Non-GAAP operating income (loss) |
$ |
4,177 |
|
|
$ |
(7,418 |
) |
|
|
156.3 |
% |
Weighted average number of common shares outstanding |
|
|
|
|
|
||||||
Basic |
|
51,013 |
|
|
|
53,987 |
|
|
|
||
Diluted |
|
51,149 |
|
|
|
54,117 |
|
|
|
||
Earnings (loss) per share |
|
|
|
|
|
||||||
Net income (loss) per diluted share |
$ |
0.09 |
|
|
$ |
(0.11 |
) |
|
$ |
0.20 |
|
Non-GAAP operating income (loss) per diluted share |
$ |
0.08 |
|
|
$ |
(0.14 |
) |
|
$ |
0.22 |
|
(1) |
Consolidated totals include inter-segment eliminations. The eliminations affect individual line items only and have no effect on net income (loss). See Note 12 of the Notes to Condensed Consolidated Financial Statements in our March 31, 2024 report on Form 10-Q for amounts by line item. |
(2) |
This line item typically includes both realized and unrealized investment gains and losses, investment impairments losses, and the change in the fair value of the contingent consideration in relation to the NORCAL acquisition. Detailed information regarding the components of net investment gains (losses) are included in Note 3 of the Notes to Condensed Consolidated Financial Statements in our March 31, 2024 report on Form 10-Q. |
The abbreviation “nm” indicates that the information or the percentage change is not meaningful. |
|
BALANCE SHEET HIGHLIGHTS |
|||||||
($ in thousands, except per share data) |
March 31, 2024 |
|
December 31, 2023 |
||||
Total investments |
$ |
4,333,542 |
|
|
$ |
4,349,781 |
|
Total assets |
$ |
5,650,036 |
|
|
$ |
5,631,925 |
|
Total liabilities |
$ |
4,536,971 |
|
|
$ |
4,519,945 |
|
Common shares (par value |
$ |
636 |
|
|
$ |
636 |
|
Retained earnings |
$ |
1,386,607 |
|
|
$ |
1,381,981 |
|
Treasury shares |
$ |
(469,702 |
) |
|
$ |
(469,702 |
) |
Shareholders’ equity |
$ |
1,113,065 |
|
|
$ |
1,111,980 |
|
Book value per share |
$ |
21.82 |
|
|
$ |
21.82 |
|
Non-GAAP adjusted book value per share(1) |
$ |
25.88 |
|
|
$ |
25.83 |
|
(1) |
Adjusted book value per share is a Non-GAAP financial measure. See a reconciliation of book value per share to Non-GAAP adjusted book value per share under the heading “Non-GAAP Financial Measures” that follows. |
| CONSOLIDATED KEY RATIOS | |||||
|
Three Months Ended March 31 |
||||
|
2024 |
|
2023 |
||
Current accident year net loss ratio |
79.9 |
% |
|
82.7 |
% |
Effect of prior accident years’ reserve development |
(0.2 |
%) |
|
2.9 |
% |
Net loss ratio |
79.7 |
% |
|
85.6 |
% |
Underwriting expense ratio |
31.9 |
% |
|
28.3 |
% |
Combined ratio |
111.6 |
% |
|
113.9 |
% |
Operating ratio |
97.7 |
% |
|
101.3 |
% |
Return on equity(1) |
1.7 |
% |
|
(2.5 |
%) |
Non-GAAP operating return on equity(1)(2) |
1.5 |
% |
|
(2.6 |
%) |
(1) |
Quarterly amounts are annualized. Refer to our March 31, 2024 report on Form 10-Q under the heading “Non-GAAP Operating ROE” in the Executive Summary of Operations section for details on our calculation. |
(2) |
See a reconciliation of ROE to Non-GAAP operating ROE under the heading “Non-GAAP Financial Measures” that follows. |
We operate in four segments: Specialty P&C, Workers' Compensation Insurance, Segregated Portfolio Cell Reinsurance, and Corporate. Additional information on ProAssurance's four segments is included in Note 12 of the Notes to Condensed Consolidated Financial Statements in our March 31, 2024 report on Form 10-Q and in the Segment Results sections below.
SPECIALTY P&C SEGMENT RESULTS
|
Three Months Ended March 31 |
|||||||||
($ in thousands) |
2024 |
|
2023 |
|
% Change |
|||||
Gross premiums written |
$ |
238,718 |
|
|
$ |
242,363 |
|
|
(1.5 |
%) |
Net premiums written |
$ |
218,699 |
|
|
$ |
217,390 |
|
|
0.6 |
% |
Net premiums earned |
$ |
188,888 |
|
|
$ |
183,684 |
|
|
2.8 |
% |
Other income |
|
1,353 |
|
|
|
990 |
|
|
36.7 |
% |
Total revenues |
|
190,241 |
|
|
|
184,674 |
|
|
3.0 |
% |
Net losses and loss adjustment expenses |
|
(152,994 |
) |
|
|
(166,029 |
) |
|
(7.9 |
%) |
Underwriting, policy acquisition and operating expenses |
|
(51,049 |
) |
|
|
(42,681 |
) |
|
19.6 |
% |
Total expenses |
|
(204,043 |
) |
|
|
(208,710 |
) |
|
(2.2 |
%) |
Segment results |
$ |
(13,802 |
) |
|
$ |
(24,036 |
) |
|
42.6 |
% |
SPECIALTY P&C SEGMENT KEY RATIOS |
|||||
|
Three Months Ended March 31 |
||||
|
2024 |
|
2023 |
||
Current accident year net loss ratio |
81.7 |
% |
|
86.4 |
% |
Effect of prior accident years’ reserve development |
(0.7 |
%) |
|
4.0 |
% |
Net loss ratio |
81.0 |
% |
|
90.4 |
% |
Underwriting expense ratio |
27.0 |
% |
|
23.2 |
% |
Combined ratio |
108.0 |
% |
|
113.6 |
% |
The results for the Specialty P&C segment improved over first quarter 2023, primarily reflecting our cautious underwriting and pricing decisions and our ability to target segments within healthcare where there are opportunities to write business profitably. However, competitive market conditions and the challenging loss environment in our MPL line of business continued unabated.
Our ability to write new business at better pricing than the business it replaces, coupled with strong renewal pricing and retention, continues to underscore our position of leadership in a very competitive market. We achieved renewal pricing increases of
The current accident year net loss ratio improved 4.7 points, primarily due to the underwriting actions taken and pricing we have achieved over the course of the past year. We recognized net favorable prior accident year reserve development of
The first quarter 2024 expense ratio was 3.8 points above the prior year first quarter. This was largely due to a
WORKERS’ COMPENSATION INSURANCE SEGMENT RESULTS |
||||||||||
|
Three Months Ended March 31 |
|||||||||
($ in thousands) |
2024 |
|
2023 |
|
% Change |
|||||
Gross premiums written |
$ |
72,615 |
|
|
$ |
73,431 |
|
|
(1.1 |
%) |
Net premiums written |
$ |
50,353 |
|
|
$ |
47,572 |
|
|
5.8 |
% |
Net premiums earned |
$ |
41,094 |
|
|
$ |
40,803 |
|
|
0.7 |
% |
Other income |
|
477 |
|
|
|
581 |
|
|
(17.9 |
%) |
Total revenues |
|
41,571 |
|
|
|
41,384 |
|
|
0.5 |
% |
Net losses and loss adjustment expenses |
|
(31,636 |
) |
|
|
(30,844 |
) |
|
2.6 |
% |
Underwriting, policy acquisition and operating expenses |
|
(14,490 |
) |
|
|
(12,980 |
) |
|
11.6 |
% |
Total expenses |
|
(46,126 |
) |
|
|
(43,824 |
) |
|
5.3 |
% |
Segment results |
$ |
(4,555 |
) |
|
$ |
(2,440 |
) |
|
(86.7 |
%) |
WORKERS’ COMPENSATION INSURANCE SEGMENT KEY RATIOS |
|||
|
Three Months Ended March 31 |
||
|
2024 |
|
2023 |
Current accident year net loss ratio |
|
|
|
Effect of prior accident years’ reserve development |
|
|
|
Net loss ratio |
|
|
|
Underwriting expense ratio |
|
|
|
Combined ratio |
|
|
|
The Workers’ Compensation Insurance segment underwriting results for the first quarter of 2024 reflect an increase in the current accident year net loss ratio driven by the continuation of higher average claim costs, the impact of compounded premium rate decreases related to the continuation of state loss cost reductions and the competitive workers' compensation market.
Gross premiums in our traditional business increased
The current accident year net loss ratio for the first quarter of 2024 increased to
There was no change in prior accident year reserve estimates in the first quarter of 2024, compared to
The underwriting expense ratio for the first quarter of 2024 was 3.5 points higher than the prior year quarter, reflecting an increase in compensation-related costs, as well as decreases in audit premium, ceding commissions received from SPCs, and ULAE allocated to net losses and loss adjustment expenses.
SEGREGATED PORTFOLIO CELL REINSURANCE SEGMENT RESULTS |
||||||||||
|
Three Months Ended March 31 |
|||||||||
($ in thousands) |
2024 |
|
2023 |
|
% Change |
|||||
Gross premiums written |
$ |
15,934 |
|
|
$ |
22,881 |
|
|
(30.4 |
%) |
Net premiums written |
$ |
13,621 |
|
|
$ |
19,947 |
|
|
(31.7 |
%) |
Net premiums earned |
$ |
14,168 |
|
|
$ |
15,300 |
|
|
(7.4 |
%) |
Net investment income |
|
693 |
|
|
|
420 |
|
|
65.0 |
% |
Net investment gains (losses) |
|
1,471 |
|
|
|
1,160 |
|
|
26.8 |
% |
Other income (expense) |
|
(1 |
) |
|
|
1 |
|
|
(200.0 |
%) |
Net losses and loss adjustment expenses |
|
(10,064 |
) |
|
|
(8,423 |
) |
|
19.5 |
% |
Underwriting, policy acquisition and operating expenses |
|
(4,713 |
) |
|
|
(5,035 |
) |
|
(6.4 |
%) |
SPC |
|
(416 |
) |
|
|
(532 |
) |
|
(21.8 |
%) |
SPC net results |
|
1,138 |
|
|
|
2,891 |
|
|
(60.6 |
%) |
SPC dividend (expense) income (2) |
|
(607 |
) |
|
|
(1,942 |
) |
|
(68.7 |
%) |
Segment results (3) |
$ |
531 |
|
|
$ |
949 |
|
|
(44.0 |
%) |
(1) |
Represents the provision for |
(2) |
Represents the net (profit) loss attributable to external cell participants. |
(3) |
Represents our share of the net profit (loss) and OCI of the SPCs in which we participate. |
| SEGREGATED PORTFOLIO CELL REINSURANCE SEGMENT KEY RATIOS | |||||
|
Three Months Ended March 31 |
||||
|
2024 |
|
2023 |
||
Current accident year net loss ratio |
65.1 |
% |
|
64.9 |
% |
Effect of prior accident years’ reserve development |
5.9 |
% |
|
(9.8 |
%) |
Net loss ratio |
71.0 |
% |
|
55.1 |
% |
Underwriting expense ratio |
33.3 |
% |
|
32.9 |
% |
Combined ratio |
104.3 |
% |
|
88.0 |
% |
Premiums in our Segregated Portfolio Cell Reinsurance segment are primarily comprised of workers' compensation coverages assumed from our Workers' Compensation Insurance segment and, to a lesser extent, medical professional liability coverages from our Specialty P&C segment.
Gross premiums written decreased in the first quarter compared to the same period in 2023, primarily due to the non-renewal of two Segregated Portfolio Cell (SPC) programs effective January 1, 2024. As the underlying policies expire that were previously written in one of the programs, we expect those policies to be renewed as traditional business in our Workers' Compensation Insurance segment. The other SPC, in which we do not participate in the underwriting results, was non-renewed.
Renewal premium reflected rate decreases of
The current accident year net loss ratio was essentially unchanged quarter-over-quarter.
We recognized
CORPORATE SEGMENT
|
Three Months Ended March 31 |
|||||||||
($ in thousands) |
2024 |
|
2023 |
|
% Change |
|||||
Net investment income |
$ |
33,204 |
|
|
$ |
29,890 |
|
|
11.1 |
% |
Equity in earnings (loss) of unconsolidated subsidiaries: |
|
|
|
|
|
|||||
All other investments, primarily investment fund LPs/LLCs |
|
3,066 |
|
|
|
(767 |
) |
|
499.7 |
% |
Tax credit partnerships |
|
(103 |
) |
|
|
(354 |
) |
|
(70.9 |
%) |
Total equity in earnings (loss) of unconsolidated subsidiaries: |
|
2,963 |
|
|
|
(1,121 |
) |
|
364.3 |
% |
Net investment gains (losses) |
|
(1,739 |
) |
|
|
752 |
|
|
(331.3 |
%) |
Other income (expense) |
|
3,061 |
|
|
|
327 |
|
|
836.1 |
% |
Operating expenses |
|
(8,688 |
) |
|
|
(8,204 |
) |
|
5.9 |
% |
Interest expense |
|
(5,657 |
) |
|
|
(5,463 |
) |
|
3.6 |
% |
Income tax (expense) benefit |
|
(692 |
) |
|
|
2,172 |
|
|
131.9 |
% |
Segment results |
$ |
22,452 |
|
|
$ |
18,353 |
|
|
22.3 |
% |
Consolidated effective tax rate |
|
|
|
|
|
|||||
The current interest rate environment continues to benefit our net investment income, which increased to
Equity in earnings from our investment in LPs/LLCs, which are typically reported to us on a one-quarter lag, reflected a
The corporate segment results include
The increase in other income was driven by the effect of foreign currency exchange rate gains of
Operating expenses increased by
NON-GAAP FINANCIAL MEASURES
Non-GAAP Operating Income (Loss)
Non-GAAP operating income (loss) is a financial measure that is widely used to evaluate performance within the insurance sector. In calculating Non-GAAP operating income (loss), we have excluded the effects of the items listed in the following table that do not reflect normal results. We believe Non-GAAP operating income (loss) presents a useful view of the performance of our insurance operations; however, it should be considered in conjunction with net income (loss) computed in accordance with GAAP. The following table reconciles net income (loss) to Non-GAAP operating income (loss):
RECONCILIATION OF NET INCOME (LOSS) TO NON-GAAP OPERATING INCOME (LOSS) |
|||||||
|
Three Months Ended March 31 |
||||||
($ in thousands, except per share data) |
2024 |
|
2023 |
||||
Net income (loss) |
$ |
4,626 |
|
|
$ |
(6,174 |
) |
Items excluded in the calculation of Non-GAAP operating income (loss): |
|
|
|
||||
Net investment (gains) losses (1) |
|
268 |
|
|
|
(2,912 |
) |
Net investment gains (losses) attributable to SPCs which no profit/loss is retained (2) |
|
1,151 |
|
|
|
913 |
|
Foreign currency exchange rate (gains) losses(3) |
|
(1,929 |
) |
|
|
827 |
|
Guaranty fund assessments (recoupments) |
|
87 |
|
|
|
(74 |
) |
Pre-tax effect of exclusions |
|
(423 |
) |
|
|
(1,246 |
) |
Tax effect, at |
|
(26 |
) |
|
|
2 |
|
After-tax effect of exclusions |
|
(449 |
) |
|
|
(1,244 |
) |
Non-GAAP operating income (loss) |
$ |
4,177 |
|
|
$ |
(7,418 |
) |
Per diluted common share: |
|
|
|
||||
Net income (loss) |
$ |
0.09 |
|
|
$ |
(0.11 |
) |
Effect of exclusions |
|
(0.01 |
) |
|
|
(0.03 |
) |
Non-GAAP operating income (loss) per diluted common share |
$ |
0.08 |
|
|
$ |
(0.14 |
) |
(1) |
Net investment gains (losses) for the three months ended March 31, 2023 include a gain of |
(2) |
Net investment gains (losses) on investments related to SPCs are recognized in our Segregated Portfolio Cell Reinsurance segment. SPC results, including any net investment gain or loss, that are attributable to external cell participants are reflected in the SPC dividend expense (income). To be consistent with our exclusion of net investment gains (losses) recognized in earnings, we are excluding the portion of net investment gains (losses) that is included in the SPC dividend expense (income) which is attributable to the external cell participants. |
(3) |
Foreign currency exchange rate gains (losses) relate to the impact of foreign exchange rate movements on foreign currency denominated loss reserves predominately associated with premium assumed from an international medical professional liability insured in our Specialty P&C segment. Our participation in this program has grown in recent years which has led to greater volatility in our results of operations even with nominal movements in exchange rates given the size of the reserve. We mitigate foreign exchange rate exposure on our Consolidated Balance Sheet by generally matching the currency and duration of associated investments to the corresponding loss reserves. In accordance with GAAP, the impact on the market value of available-for-sale fixed maturities due to changes in foreign currency exchange rates is reflected as a part of OCI. Conversely, the impact of changes in foreign currency exchange rates on loss reserves is reflected through net income (loss) as a component of other income. Therefore, we believe foreign currency exchange rate gains (losses) in our Consolidated Statements of Income and Comprehensive Income in isolation are not indicative of our operating performance. |
(4) |
The |
Non-GAAP Operating ROE
The following table is a reconciliation of ROE to Non-GAAP operating ROE for the three months ended March 31, 2024 and 2023:
|
Three Months Ended March 31 |
||||
|
2024 |
|
2023 |
||
ROE(1) |
1.7 |
% |
|
(2.5 |
%) |
Pre-tax effect of items excluded in the calculation of Non-GAAP operating ROE |
(0.2 |
%) |
|
(0.1 |
%) |
Tax effect, at |
— |
% |
|
— |
% |
Non-GAAP operating ROE |
1.5 |
% |
|
(2.6 |
%) |
(1) |
Quarterly amounts are annualized. Refer to our March 31, 2024 report on Form 10-Q under the heading “Non-GAAP Operating ROE” in the Executive Summary of Operations section for details on our calculation. |
(2) |
The |
Non-GAAP Adjusted Book Value per Share
The following table is a reconciliation of our book value per share to Non-GAAP adjusted book value per share at March 31, 2024 and December 31, 2023:
|
Book Value Per Share |
||
Book Value Per Share at December 31, 2023 |
$ |
21.82 |
|
Less: AOCI Per Share(1) |
|
(4.01 |
) |
Non-GAAP Adjusted Book Value Per Share at December 31, 2023 |
|
25.83 |
|
Increase (decrease) to Non-GAAP Adjusted Book Value Per Share during the three months ended March 31, 2024 attributable to: |
|
||
Net income (loss) |
|
0.09 |
|
Other(2) |
|
(0.04 |
) |
Non-GAAP Adjusted Book Value Per Share at March 31, 2024 |
|
25.88 |
|
Add: AOCI Per Share(1) |
|
(4.06 |
) |
Book Value Per Share at March 31, 2024 |
$ |
21.82 |
|
(1) |
Primarily the impact of accumulated unrealized investment gains (losses) on our available-for-sale fixed maturity investments. See Note 9 of the Notes to Condensed Consolidated Financial Statements in our March 31, 2024 report on Form 10-Q for additional information. |
(2) |
Includes the impact of share-based compensation. |
Conference Call Information
ProAssurance management will discuss first quarter 2024 results during a conference call at 10:00 a.m. ET on Tuesday, May 7, 2024. US-based investors may access the call by dialing either (833) 470-1428 (toll free) or (404) 975-4839 (local). Toll-free numbers for international investors may be found using this link: https://www.netroadshow.com/events/global-numbers?confId=63389. The access code for all attendees is 923054.
Callers who wish to avoid operator wait times and receive unique call access details may preregister using this link: https://www.netroadshow.com/events/login?show=77ece0eb&confild=63389.
The conference call will also be webcast at https://events.q4inc.com/attendee/483256153.
A replay will be available by telephone for at least 7 days after the call date. US-based investors may access the replay by dialing (866) 813-9403 (toll free) or (929) 458-6194, and international investors may dial +44 (204) 525-0658. The access code for all attendees is 547985. A replay will also be available for at least one year at investor.proassurance.com. Investors may follow @ProAssurance on X (formerly Twitter) to be notified of the latest news about ProAssurance.
About ProAssurance
ProAssurance Corporation is an industry-leading specialty insurer with extensive expertise in medical professional liability, products liability for medical technology and life sciences, legal professional liability, and workers’ compensation insurance.
ProAssurance Group is rated “A” (Excellent) by AM Best. ProAssurance and its operating subsidiaries (excluding NORCAL Group) are rated “A-” (Strong) by Fitch Ratings. For the latest on ProAssurance and its industry-leading suite of products and services, cutting-edge risk management and practice enhancement programs, follow @ProAssurance on X (formerly Twitter) or LinkedIn. ProAssurance’s YouTube channel regularly presents thought-provoking, insightful videos that communicate effective practice management, patient safety and risk management strategies.
Caution Regarding Forward-Looking Statements
Any statements in this news release that are not historical facts or explicitly stated as an opinion are specifically identified as forward-looking statements. These statements are based upon our estimates and anticipation of future events and are subject to significant risks, assumptions and uncertainties that could cause actual results to differ materially from the expected results described in the forward-looking statements. Forward-looking statements are identified by words such as, but not limited to, “anticipate,” “believe,” “estimate,” “expect,” “hope,” “hopeful,” “intend,” “likely,” “may,” “optimistic,” “possible,” “potential,” “preliminary,” “project,” “should,” “will,” and other analogous expressions.
Although it is not possible to identify all of these risks and factors, they include, among others, the following: inadequate loss reserves to cover the Company's actual losses; inherent uncertainty of models resulting in actual losses that are materially different than the Company's estimates; adverse economic factors; a decline in the Company's financial strength rating; loss of one or more key executives; loss of a group of agents or brokers that generate significant portions of the Company's business; failure of any of the loss limitations or exclusions the Company employs, or change in other claims or coverage issues; adverse performance of the Company's investment portfolio; adverse market conditions that affect its excess and surplus lines insurance operations; and other risks described in the Company's filings with the Securities and Exchange Commission. These forward-looking statements speak only as of the date of this release and the Company does not undertake and specifically declines any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240506179693/en/
Heather J. Wietzel
SVP, Investor Relations
800-282-6242 • 205-776-3028 • InvestorRelations@ProAssurance.com
Source: ProAssurance Corporation
FAQ
<p>What was ProAssurance's net income for the first quarter of 2024?</p>
ProAssurance reported net income of $4.6 million for the first quarter of 2024.
<p>What was the change in gross premiums written for the first quarter of 2024?</p>
There was a 1% decrease in gross premiums written for the first quarter of 2024.
<p>How did the consolidated combined ratio change for ProAssurance in 2024?</p>
The consolidated combined ratio improved by 2 points to 111.6% in 2024.
<p>What was the book value per share for ProAssurance as of March 31, 2024?</p>
The book value per share was $21.82 as of March 31, 2024.
