American Financial Group, Inc. (AFG) 2023 Q4 法說會逐字稿

Good day, and thank you for standing by. Welcome to the American Financial Group Fourth Quarter and Full Year 2023 Results Conference Call. (Operator Instructions). Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Diane Weidner, Vice President, Investor Relations. Please go ahead.

各位好，感謝您稍候。歡迎參加 American Financial Group 2023 年第四季及全年業績電話會議。（接線員指示）。請注意，今天的會議將被錄音。現在我想將會議交給今天的發言人——投資人關係副總裁 Diane Weidner。請開始。

Thank you. Good morning, and welcome to American Financial Group's Fourth Quarter 2023 Earnings Results Conference Call. We released our 2023 fourth quarter and full year 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.

謝謝。各位早安，歡迎參加 American Financial Group 2023 年第四季盈餘結果電話會議。我們已於昨天下午發布 2023 年第四季及全年業績。我們的新聞稿、投資人補充資料與網路直播簡報已張貼於 AFG 官網「投資人關係」專區。今天電話會議的部分內容將引用這些資料。

I'm joined this morning by Carl Lindner III and Craig Lindner, Co-CEOs of American Financial Group, and Brian Hertzman, AFG's CFO. Before I turn the discussion over to Carl, I would like to draw your attention to the notes on Slide 2 of our webcast. Some of the matters to be discussed today are forward-looking. These forward-looking statements involve certain risks and uncertainties that could cause our actual results and/or financial condition to differ materially from these statements. A detailed description of these risks and uncertainties can be found in AFG's filings with the Securities and Exchange Commission, which are also available on our website.

今天早上與我一同出席的有 American Financial Group 共同執行長 Carl Lindner III 與 Craig Lindner，以及 AFG 財務長 Brian Hertzman。在我把討論交給 Carl 之前，我想請各位留意我們網路直播第 2 頁投影片的附註。今天將討論的部分事項屬於前瞻性陳述。這些前瞻性陳述涉及若干風險與不確定性，可能導致我們的實際結果及／或財務狀況與這些陳述存在重大差異。關於這些風險與不確定性的詳細說明，請參閱 AFG 向美國證券交易委員會（SEC）提交的文件；這些文件亦可在我們的網站上取得。

We may include references to core net operating earnings, a non-GAAP financial measure, in our remarks or in responses to questions. A reconciliation of net earnings 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 accuracy, and as a result, it may contain factual or transcription errors that could materially alter the intent or meaning of our statements.

我們在發言或回答問題時，可能會提及核心淨營運盈餘（core net operating earnings）這一非 GAAP 財務衡量指標。淨盈餘與核心淨營運盈餘之間的調節表已包含在我們的盈餘新聞稿中。最後，若您正在閱讀本次電話會議的逐字稿，請注意該逐字稿可能未經授權或審閱以確認其準確性，因此可能包含事實或轉錄錯誤，並可能對我們陳述的意圖或含義造成重大影響。

Now I'm pleased to turn the call over to Carl Lindner III to discuss our results.

現在我很高興把電話會議交給 Carl Lindner III，請他說明我們的業績。

Good morning. I'll begin my remarks by sharing a few highlights from AFG's fourth quarter and full year results, after which Craig and I will walk through more details. We'll then open it up for Q&A, where Craig, Brian and I will respond to any questions.

各位早安。我將先分享 AFG 第四季與全年業績的幾項重點，之後 Craig 和我會進一步說明更多細節。接著我們將開放問答，由 Craig、Brian 和我回答各位的問題。

The fourth quarter was a strong ending to a great year for AFG. In addition to producing a core operating return on equity of nearly 20% in 2023, net written premiums grew by 8% during the year, and we continue to create value for our shareholders through effective capital management.

第四季為 AFG 這個優異年度畫下強勁句點。除了 2023 年核心營運股東權益報酬率接近 20% 之外，全年淨簽單保費成長 8%，我們也持續透過有效的資本管理為股東創造價值。

Our compelling mix of specialty insurance businesses, an entrepreneurial culture, disciplined operating philosophy and an astute team of in-house investment professionals, collectively have enabled us to outperform many of our peers over time.

我們具吸引力的專業保險業務組合、創業家文化、嚴謹的營運理念，以及精明的內部投資專業團隊，綜合起來使我們長期以來能夠優於許多同業。

Craig and I thank God, our talented management team, and our great employees for helping us to achieve these results. I'll now turn the discussion over to Craig to walk us through some of these details.

Craig 和我感謝上帝、我們優秀的管理團隊，以及所有傑出的員工，協助我們達成這些成果。現在我把討論交給 Craig，請他帶領我們深入說明部分細節。

Thanks, Carl. As you'll see on Slide 3, AFG's core net operating earnings were $10.56 per share for the full year 2023, generating a core operating return on equity of 19.8%. This ROE is calculated using an average of the five most recent quarter end balances of shareholders' equity, excluding AOCI.

謝謝，Carl。如同第 3 頁投影片所示，AFG 2023 年全年核心淨營運盈餘為每股 10.56 美元，核心營運股東權益報酬率為 19.8%。此 ROE 的計算係採用最近五個季度期末股東權益餘額的平均值，並排除 AOCI（累積其他綜合損益）。

As Carl noted, capital management is one of our highest priorities. Returning capital to our shareholders is an important component of our capital management strategy and reflects our strong financial position and our confidence in AFG's financial future. We returned $900 million to shareholders during 2023, including $466 million or $5.50 per share in special dividends, $221 million in regular common stock dividends and $213 million in share repurchases. Dividend payments and share repurchases totaled $5.92 billion over the past five years, and our quarterly dividend was increased by 12.7% to an annual rate of $2.84 per share beginning in October of 2023. Growth in adjusted book value per share plus dividends was an impressive 16.6% in 2023. We're proud of the value we've created for shareholders over time.

如 Carl 所提，資本管理是我們最優先的事項之一。將資本回饋給股東是我們資本管理策略的重要組成部分，反映我們強勁的財務狀況以及對 AFG 財務前景的信心。2023 年我們共向股東回饋 9 億美元，其中包括 4.66 億美元（或每股 5.50 美元）的特別股利、2.21 億美元的普通股定期股利，以及 2.13 億美元的庫藏股回購。過去五年股利發放與股票回購合計達 59.2 億美元；自 2023 年 10 月起，我們將季度股利提高 12.7%，使年化股利率達每股 2.84 美元。2023 年每股調整後帳面價值加計股利的成長率達到亮眼的 16.6%。我們為長期以來為股東創造的價值感到自豪。

Turning to Slides 4 and 5, you'll see that fourth quarter 2023 core net operating earnings per share of $2.84 produced an annualized fourth quarter core return on equity of 20.9%. Net earnings per share of $3.13 included an after-tax non-core realized gain on securities of $0.29 per share which includes fair value changes on securities that we continued to hold at the end of the quarter.

請看第 4 與第 5 頁投影片，2023 年第四季核心淨營運盈餘為每股 2.84 美元，換算年化後的第四季核心股東權益報酬率為 20.9%。每股淨盈餘為 3.13 美元，其中包含每股 0.29 美元的稅後非核心已實現證券收益，該收益包含我們在季末仍持有之證券的公允價值變動。

Now I'd like to turn to an overview of AFG's investment performance, financial position, and share a few comments about AFG's capital and liquidity. The details surrounding our $15.3 billion investment portfolio are presented on Slides 6 and 7. Looking at results for the fourth quarter, Property & Casualty net investment income was approximately 1% higher than the comparable 2022 period. Excluding the impact of alternative investments, net investment income in our P&C insurance operations for the three months ended December 31, 2023, increased by 19% year-over-year as a result of the impact of rising interest rates and higher balances of invested assets.

接下來我將概述 AFG 的投資表現與財務狀況，並就 AFG 的資本與流動性分享幾點看法。我們 153 億美元投資組合的相關細節列於第 6 與第 7 頁投影片。就第四季結果而言，產險（Property & Casualty）淨投資收益較 2022 年同期約增加 1%。若排除替代性投資的影響，截至 2023 年 12 月 31 日止三個月，我們產險營運的淨投資收益年增 19%，主要受利率上升與投資資產餘額增加所帶動。

For the twelve months ended December 31, 2023, P&C net investment income was $729 million, approximately 7% higher than 2022 and a new record for AFG. Excluding alternative investments, net investment income in our P&C insurance operations for 2023 increased 35% year-over-year.

截至 2023 年 12 月 31 日止十二個月，產險淨投資收益為 7.29 億美元，較 2022 年約增加 7%，並創下 AFG 新高紀錄。若排除替代性投資，我們 2023 年產險營運的淨投資收益年增 35%。

As you'll see on Slide 7, approximately 68% of our portfolio is invested in fixed maturities. In the current interest rate environment, we're able to invest in fixed maturity securities at yields of approximately 5.5%. Current reinvestment rates compare favorably to the approximately 5% yield earned on fixed maturities in our P&C portfolio during the fourth quarter of 2023. The duration of our P&C fixed maturity portfolio, including cash and cash equivalents, was 2.9 years at December 31, 2023. We've strategically managed duration to take advantage of market opportunities as interest rates have increased from recent historic lows. The annualized return on alternative investments was approximately 0.8% in the 2023 fourth quarter compared to 5.3% for the prior year quarter.

如第 7 頁投影片所示，我們的投資組合約 68% 配置於固定到期證券。在目前利率環境下，我們可將資金投資於固定到期證券，殖利率約為 5.5%。目前再投資利率相較於 2023 年第四季我們產險投資組合固定到期證券約 5% 的收益率更具吸引力。截至 2023 年 12 月 31 日，我們產險固定到期投資組合（含現金及約當現金）的存續期間為 2.9 年。隨著利率自近期歷史低點上升，我們已策略性管理存續期間，以把握市場機會。2023 年第四季替代性投資的年化報酬率約為 0.8%，相較於前一年同期為 5.3%。

Following several years of exceptionally strong returns on investments tied to multi-family housing, which averaged 15% over the past five years, we're seeing the impact of increased supply and the leveling out of rental rates on these investments, which represent about half of our alternative investment portfolio. We expect these headwinds to continue into 2024.

在與多戶住宅（multi-family housing）相關的投資連續多年取得特別強勁的報酬之後（過去五年平均為 15%），我們正看到供給增加與租金成長趨於持平對這些投資的影響；此類投資約占我們替代性投資組合的一半。我們預期這些逆風將延續至 2024 年。

Longer term, we remain very optimistic regarding the prospects of our investments in multi-family housing, as these properties continue to generate strong net operating income and have desirable geographic positioning and high occupancy rates. The return on P&C alternative investments was 7% for 2023 compared to 13.2% in 2022. The average annual return on alternative investments over the past five calendar years ended December 31, 2023, was approximately 13%.

從較長期來看，我們對多戶住宅投資的前景仍非常樂觀，因為這些資產持續產生強勁的淨營運收入，且具備理想的地理位置與高入住率。2023 年產險替代性投資報酬率為 7%，相較於 2022 年為 13.2%。截至 2023 年 12 月 31 日止過去五個曆年，替代性投資的平均年化報酬率約為 13%。

Please turn to Slide 8, where you'll find a summary of AFG's financial position at December 31, 2023. AFG had approximately $800 million of excess capital at the end of 2023. In reviewing our disclosures compared to peer companies and considering the diversity of practice in how companies calculate excess capital, we're likely to move away from providing a specific excess capital number in the future.

請翻到第 8 頁投影片，您將看到截至 2023 年 12 月 31 日 AFG 財務狀況的摘要。AFG 在 2023 年底約有 8 億美元的超額資本。在檢視我們相較同業公司的揭露內容，並考量各公司在計算超額資本方式上的多樣做法後，我們未來可能會逐步不再提供特定的超額資本數字。

Yesterday, we announced a special dividend of $2.50 per share payable on February 28, 2024. This special dividend is in addition to the Company's regular quarterly cash dividend of $0.71 per share most recently paid on January 25, 2024. We expect our operations to continue to generate significant excess capital throughout the remainder of 2024, which provides ample opportunity for additional share repurchases or special dividends over the next year.

昨日，我們宣布每股2.50美元的特別股利，將於2024年2月28日支付。此特別股利係在公司例行每季現金股利（每股0.71美元，最近一次於2024年1月25日支付）之外另行發放。我們預期在2024年剩餘期間，我們的營運將持續產生可觀的超額資本，這為未來一年進一步進行股票回購或發放特別股利提供了充足空間。

We continue to view total value creation, as measured by growth in book value per share plus dividends, as an important measure of performance over the long term. For the twelve months ended December 31, 2023, AFG's book value per share plus dividends increased by 24.1%. AFG's adjusted book value per share plus dividends, which excludes unrealized losses related to fixed maturities, increased by 16.6% during 2023.

我們仍將以每股帳面價值成長加上股利（以此衡量的總價值創造）視為長期的重要績效衡量指標。截至2023年12月31日止十二個月，AFG的每股帳面價值加上股利增加了24.1%。AFG的調整後每股帳面價值加上股利（排除與固定到期證券相關的未實現損失）於2023年增加了16.6%。

I'll now turn the call back over to Carl to discuss the results of our P&C operations.

接下來我把電話交回給Carl，請他討論我們產險（P&C）營運的結果。

Thank you, Craig. Now if you'd please turn to Slides 9 and 10 of the webcast. I'm pleased to report very strong underwriting profitability for the full year, with an overall Specialty Property and Casualty combined ratio of 90.3%. We're proud of our consistent record of profitable underwriting results over many years. We're seeing opportunities to grow our Specialty Property and Casualty businesses through increasing exposures, new opportunities, and a continued favorable pricing environment. We set new records for premium production in 2023 and we're meeting or exceeding targeted returns in nearly all of our businesses.

謝謝你，Craig。現在請各位翻到網路直播簡報的第9與第10頁。我很高興報告全年核保獲利能力非常強勁，整體專業財產與意外險（Specialty Property and Casualty）綜合比率為90.3%。我們以多年來持續維持獲利核保成果的穩健紀錄為榮。我們看到透過提高承保曝險、新的機會，以及持續有利的定價環境，來擴大我們專業財產與意外險業務的機會。我們在2023年創下保費產出新高，且在幾乎所有業務中都達到或超越目標報酬。

As you'll see on Slide 9, our Specialty Property and Casualty businesses reported a strong fourth quarter, a nice finish to a successful year. The Specialty Property and Casualty insurance operations generated an outstanding 87.7% combined ratio in the fourth quarter of 2023, about a point higher than the exceptional 86.6% reported in the prior year fourth quarter. Results for the 2023 fourth quarter include 1.4 points of catastrophe losses, about a half point higher than last year's fourth quarter and 3.3 points of favorable prior year reserve development, compared to 3.6 points in the fourth quarter of 2022.

如各位在第9頁所見，我們的專業財產與意外險業務在第四季表現強勁，為成功的一年畫下漂亮句點。2023年第四季，專業財產與意外險保險營運創下出色的87.7%綜合比率，較前一年第四季的卓越86.6%高約1個百分點。2023年第四季的結果包含1.4個百分點的巨災損失，較去年第四季高約0.5個百分點；以及3.3個百分點的有利前期年度準備金發展（prior year reserve development），相較之下，2022年第四季為3.6個百分點。

Fourth quarter 2023 gross and net written premiums were both up 8% when compared to the same period in 2022. Gross and net written premiums increased 7% and 8%, respectively, for the full year in 2023. Average renewal pricing across our Property & Casualty Group, excluding our workers' comp business, was up approximately 7% for the quarter, in line with renewal rates in the previous quarter. Including workers' compensation, renewal rates were up approximately 6%, one point higher than the renewal increases reported in the prior quarter.

2023年第四季的毛承保保費與淨承保保費，相較2022年同期皆成長8%。2023年全年毛承保保費與淨承保保費分別成長7%與8%。我們產險集團（Property & Casualty Group）在本季的平均續保定價（不含勞工補償險業務）約上升7%，與前一季的續保費率水準一致。若包含勞工補償險，續保費率約上升6%，較前一季所報告的續保增幅高1個百分點。

This is our 30th consecutive quarter to report overall renewal rate increases, and we believe we are achieving overall renewal rate increases in excess of prospective loss ratio trends to meet or exceed targeted returns. In addition to renewal pricing, we are focusing on insured values in our property-related businesses to ensure that our premiums reflect inflationary considerations.

這是我們連續第30個季度報告整體續保費率上升；我們相信，為了達到或超越目標報酬，我們所取得的整體續保費率增幅已超過預期損失率趨勢。除續保定價外，我們也聚焦於與財產相關業務的保險標的價值，以確保保費能反映通膨因素。

Now I'd like to turn to Slide 10 to review a few highlights from each of our Specialty Property and Casualty business groups. Details are included in our earnings release, so I'll focus on summary results here.

接下來我想請各位看第10頁，回顧我們各專業財產與意外險業務群的一些重點。詳細內容已載於我們的財報新聞稿，因此我在此將聚焦於摘要結果。

The businesses in the Property and Transportation Group achieved a 90.3% calendar year combined ratio overall in the fourth quarter, in line with the 90.0% achieved in the comparable period last year. Excluding crop, the fourth quarter calendar year combined ratio in this group improved three points year-over-year. Fourth quarter 2023 gross and net written premiums in this group were up 4% and 1%, respectively, when compared to the 2022 fourth quarter, due primarily to slightly higher crop premium related to the CRS acquisition, which was partially offset by the timing of renewals in several of our transportation businesses.

財產與運輸事業群（Property and Transportation Group）在第四季的整體日曆年度綜合比率為90.3%，與去年同期的90.0%大致一致。若排除農作物保險（crop），該事業群第四季的日曆年度綜合比率較去年同期改善3個百分點。2023年第四季該事業群的毛承保保費與淨承保保費，較2022年第四季分別成長4%與1%，主要因CRS收購案帶來略高的農作物保費，但部分被我們若干運輸業務續保時點所抵銷。

Overall renewal rates in this group increased 7% on average in the fourth quarter of 2023, a point higher than the previous quarter. Pricing for the full year for this group was up 6% overall. We continue to remain focused on rate adequacy, particularly in our commercial auto liability business. This is our 11th year of rate increases in this line of business dating back to when we first identified an uptick in commercial auto loss severity in 2012, so we've been at it for a long time, and we're pleased that our starting point for rate increases is different than some of our peers.

該事業群在2023年第四季的整體續保費率平均上升7%，較前一季高1個百分點。該事業群全年定價整體上升6%。我們持續專注於費率充足性（rate adequacy），尤其是在商用車責任險（commercial auto liability）業務方面。自2012年我們首次發現商用車損失嚴重度上升以來，這已是我們在此業務線連續第11年調升費率；我們已投入很長時間，也很高興我們調升費率的起點與部分同業不同。

The businesses in our Specialty Casualty Group achieved an exceptionally strong 84.6% calendar year combined ratio overall in the fourth quarter, 3.3 points higher than the 81.3% reported in the comparable prior year period. With combined ratios at these levels, the underwriting margins in these businesses are generating returns in the mid-20s. Fourth quarter 2023 gross and net written premiums increased 6% and 7%, respectively, when compared to the same prior year period. Renewal pricing for this group, excluding our workers' comp business, was up 7% in the fourth quarter and was up 4% overall, with both measures down about a point from the renewal pricing in the previous quarter. Pricing for this group for the full year, excluding workers' comp, was up 6% and up 4% overall.

我們的專業意外險事業群（Specialty Casualty Group）在第四季的整體日曆年度綜合比率達到特別強勁的84.6%，較去年同期的81.3%高3.3個百分點。在此等綜合比率水準下，這些業務的核保利潤率正帶來約20%中段（mid-20s）的報酬。2023年第四季毛承保保費與淨承保保費較去年同期分別成長6%與7%。該事業群的續保定價（不含勞工補償險）在第四季上升7%，整體上升4%；兩項指標皆較前一季的續保定價約低1個百分點。該事業群全年定價（不含勞工補償險）上升6%，整體上升4%。

The Specialty Financial Group continued to achieve excellent underwriting margins and reported an outstanding 81.3% combined ratio for the fourth quarter of 2023, an improvement of 1.8 points over the prior year period. Fourth quarter 2023 gross and net written premiums were up 27% and 26%, respectively, when compared to the same 2022 period and 32% for the full year. Renewal pricing in this group was up 9% in the fourth quarter, accelerating four points from the previous quarter. Renewal pricing in this group was up 5% for the full year of 2023.

專業金融事業群（Specialty Financial Group）持續維持優異的核保利潤率，並在2023年第四季報告出色的81.3%綜合比率，較去年同期改善1.8個百分點。2023年第四季毛承保保費與淨承保保費較2022年同期分別成長27%與26%，全年則成長32%。該事業群第四季續保定價上升9%，較前一季加速4個百分點。該事業群2023年全年續保定價上升5%。

As noted in yesterday's earnings release, for many years, AFG established a range of core net operating earnings per share guidance for the new year and provided various other guidance measures as a part of its fourth quarter earnings release. After reviewing industry and peer practices and following a number of discussions with analysts and shareholders, we have decided we'll no longer provide a range of core earnings per share guidance or other guidance measures beginning in 2024.

如昨日的財報新聞稿所述，多年來AFG在第四季財報發布時，會為新年度建立核心淨營運每股盈餘（core net operating earnings per share）的指引區間，並提供其他多項指引指標。在檢視產業與同業作法，並在與分析師及股東進行多次討論後，我們決定自2024年起不再提供核心每股盈餘指引區間或其他指引指標。

As noted throughout this call, it's clear that our focus has always been on long-term shareholder value creation by generating strong returns on equity that grow book value per share. We believe that historically providing a greater level of guidance metrics as compared to peer companies, has created a distraction from our strong ROEs and a record of long-term value creation. As a result, we believe that this change aligns with that focus.

如本次電話會議多次提及，很明顯我們的重點一向是透過產生強勁的股東權益報酬率（ROE）以推動每股帳面價值成長，從而創造長期股東價值。我們認為，過去相較同業提供較多層級的指引指標，反而分散了市場對我們強勁ROE與長期價值創造紀錄的注意力。因此，我們相信此項變更與上述重點一致。

In lieu of guidance, though we have provided several key assumptions underlying our 2024 business plan, which you'll see summarized on Slide 11. These assumptions for 2024 include: growth in net written premiums of 8% compared to last year, a combined ratio similar to 90.3% achieved in 2023, a reinvestment rate of approximately 5.5% and a return of approximately 6% on our $2.4 billion portfolio of alternative investments. We expect that performance in line with the assumptions included in our business plan would result in core operating earnings per share of approximately $11.00 in 2024 and generate a core operating return on equity excluding AOCI of approximately 20%.

作為指引的替代方案，我們已提供若干支撐2024年業務計畫的關鍵假設，並將在第11頁摘要呈現。2024年的假設包括：淨承保保費較去年成長8%；綜合比率與2023年達成的90.3%相近；再投資利率約5.5%；以及對我們24億美元另類投資組合的報酬約6%。我們預期，若實際表現符合業務計畫所列假設，2024年核心營運每股盈餘約為11.00美元，並可產生約20%的核心營運股東權益報酬率（不含AOCI）。

We believe that our disclosures are sufficiently detailed and clear, and over the course of 2024, our discussions with investors will focus on the considerations that drive long-term shareholder value. Our IR team and our management team remain available to answer questions and look forward to continuing to educate investors about our business.

我們相信，我們的揭露已足夠詳盡且清楚；在 2024 年期間，我們與投資人的討論將聚焦於驅動長期股東價值的各項考量。我們的投資人關係（IR）團隊與管理團隊仍隨時可回答問題，並期待持續向投資人說明我們的業務。

Craig and I are pleased to report these exceptionally strong results for the fourth quarter and full year, and we're proud of our proven track record of long-term value creation. Our insurance professionals have exercised their Specialty Property and Casualty knowledge and experience to skillfully navigate the marketplace, and our in-house investment team has been both strategic and opportunistic in the management of our $15 billion investment portfolio. We're well positioned to continue to build long-term value for our shareholders in 2024 and beyond.

Craig 和我很高興報告第四季與全年這些格外強勁的成果，也為我們經證實的長期價值創造紀錄感到自豪。我們的保險專業團隊運用其在專業財產與意外險（Specialty Property and Casualty）方面的知識與經驗，熟練地因應市場環境；而我們的內部投資團隊在管理我們 150 億美元投資組合時，兼具策略性與把握機會的能力。我們已做好充分準備，將在 2024 年及未來持續為股東創造長期價值。

Now we'll open the line for the Q&A portion of today's call. And Craig and Brian and I would be happy to respond to your questions.

現在我們將開放電話線，進入今天電話會議的問答（Q&A）環節。Craig、Brian 和我都很樂意回覆各位的問題。

(Operator Instructions) Our first question comes from the line of Charlie Lederer with Citi.

（接線員指示）我們的第一個問題來自花旗（Citi）的 Charlie Lederer。

Hey, good morning. Wondering, can you please break out the reserve development, I guess, for nonworkers' comp Casualty reserve development across accident years 2020 to 2022 versus the softer market years prior to that in the quarter? Can you hear me?

嗨，早安。我想請問，能否請你們拆解一下本季非勞工補償（nonworkers' comp）的意外險（Casualty）準備金發展（reserve development），大概是 2020 到 2022 事故年度（accident years）相較於更早之前較疲弱市場年度的情況？你們聽得到我嗎？

Hi. This is Brian Hertzman. On that question, if you look at where we've seen development by year in Casualty, most of, we've seen some adverse development coming out of calendar years 2018 and 2019, so that's consistent with prior periods. If you look at development overall in Casualty, we think it's best to look at it for the full year to understand trends. So looking at the full year, I think the first thing to do is to keep in perspective that we're talking about businesses with the calendar year combined ratio for the full year of 87% with ROEs in the mid-20s, so very strong performing businesses.

嗨，我是 Brian Hertzman。關於這個問題，如果你看我們在意外險按年度所看到的發展情況，大部分是來自 2018 與 2019 會計年度（calendar years）的一些不利發展（adverse development），這與先前期間一致。若看意外險整體的發展，我們認為最好以全年角度來看，以理解趨勢。因此從全年來看，我想首先要把背景放在心上：我們談的是全年會計年度綜合率（combined ratio）為 87%、股東權益報酬率（ROE）在 20% 中段的業務，因此是表現非常強勁的業務。

As we discussed in some of the previous quarters. For the full year 2024, we did have lower levels of favorable development in workers' comp, as our initial loss picks have come down in recent years, reflecting our experience and considering some of the price decreases in that business, as well as being mindful about the potential for medical cost inflation going forward.

如同我們在先前幾個季度所討論的。就 2024 全年而言，我們在勞工補償（workers' comp）方面的有利發展（favorable development）水準較低，因為近年我們的初始損失估計（initial loss picks）已下調，反映了我們的經驗，同時也考量該業務的一些降價情況，並且留意未來醫療成本通膨的潛在影響。

We talked in previous quarters about some adverse development from social inflation in areas like public sector. As with any company that has an E&S business, over time, there can be occasional large loss activity, which we had in various lines of business in different quarters across the year.

我們在先前幾個季度談到，在公共部門等領域因社會通膨（social inflation）而出現一些不利發展。對任何擁有 E&S（超額及剩餘險）業務的公司而言，隨著時間推移，偶爾會出現大型損失事件；我們在今年不同季度、不同業務線中也確實出現了這種情況。

Got it. Thanks. That's helpful. I guess, sorry if I missed it. Did you say that the adverse on '18 and '19 that you said at the beginning, was that, did you say what lines those were in the quarter?

了解，謝謝。這很有幫助。不好意思如果我漏聽了：你一開始提到 2018 和 2019 的不利發展，那你有說本季是哪些業務線造成的嗎？

So most of that for the year, most of that's coming out of the social inflation-exposed businesses. In the quarter, it wasn't necessarily all social inflation. Some of that was the, just the occasional large losses that could happen in something like E&S.

就全年而言，大部分來自暴露於社會通膨的業務。本季則不一定全是社會通膨；其中一部分只是像 E&S 這類業務可能偶爾發生的大型損失。

Got it. Okay. And then maybe just on the premium growth embedded in your business plan, would you be able to kind of parse out, I guess, like how much of that, what you're expecting for crop? I guess, from a non-CRS and then including CRS perspective and kind of versus the rest of the business?

了解。好。接著關於你們營運計畫中隱含的保費成長，你們能否大致拆解一下，例如你們對農作物險（crop）的預期有多少？我想從不含 CRS 與包含 CRS 的角度，以及相對於其他業務的部分。

We're kind of, we've moved away from talking segment by segment. I'm happy to give you some color on the crop. The crop business -- part of the premium determination for this year is a volatility factor, which is determined in the next month or so and also kind of the average of February futures prices for the December contract in corn and the November contract, I believe, in soybeans.

我們有點已經不再逐一按分部來談。不過我很樂意就農作物險提供一些補充說明。農作物險——今年保費決定因素之一是波動度因子（volatility factor），它會在接下來一個月左右確定；另外也取決於 2 月份整個月的期貨平均價格：玉米是 12 月合約，大豆我記得是 11 月合約。

When you look at the current pricing, it's the average of the whole month of February. So we don't know until we get down to the end of February exactly what the impact on the premiums are. I think our 8% reflects our current view that crop premiums aren't going to be as large as what we would previously projected in that, because of the commodity prices. I can tell you that. With the CRS business that we added, that business will be up about 50% on a gross written premium basis for this year.

就目前定價來看，是取 2 月整個月的平均。因此在 2 月底之前，我們無法確切知道對保費的影響。我認為我們的 8% 反映了目前的看法：由於商品價格，農作物險保費不會像我們先前在預測中所預期的那麼高。我可以這麼說。至於我們新增的 CRS 業務，今年在簽單保費（gross written premium）基礎上將成長約 50%。

Thank you. I guess just one follow-up. Would you expect any changes in your crop retention plans if pricing is materially lower?

謝謝。我再追問一個問題：如果定價明顯較低，你們會預期在農作物險的自留（retention）計畫上有任何變動嗎？

No. I think probably one of the positive things if you're starting off if the pricing for corn and soybeans ends up being lower from a price exposure since this is revenue protection or revenue coverage, you could argue that it may be tougher to see prices come off by significant amounts from lower spring discovery prices, if that's in fact what happens at the end of February. So that can kind of cut both ways. We'll have lower premium, but maybe you have lower exposure from a price decline standpoint from those base levels, if that makes sense.

不會。我認為如果玉米與大豆的定價最後確實較低，從價格曝險角度來看，反而可能有一個正面因素：因為這是收入保障（revenue protection）或收入保險（revenue coverage），你可以說，若春季價格發現（spring discovery prices）較低，那麼要再從較低的春季發現價格大幅下跌，可能會更不容易——如果 2 月底的結果確實如此的話。所以這可能是雙面刃：我們的保費會較低，但從那些基準水準出發，因價格下跌所帶來的曝險也可能較低；希望這樣說得通。

Yeah, understood. Thank you.

是的，了解。謝謝。

Thank you. Our next question comes from the line of Paul Newsome with Piper Sandler.

謝謝。下一個問題來自 Piper Sandler 的 Paul Newsome。

Good morning. Thanks for the call. Wanted to touch maybe back on your comments about pricing being above where you think you could, inflation is to achieve target. At the moment, the ROE is very high. Is that really a comment that you continue to expect to achieve sort of the targeted returns? Or are you thinking that the price increases are sufficiently to maintain the current sort of margins that you have today?

早安，謝謝這通電話會議。我想回到你們先前的評論：你們提到定價高於你們認為為達成目標所需、相對於通膨的水準。目前 ROE 非常高。這句話的意思是你們仍預期能達成目標報酬？還是你們認為目前的漲價幅度足以維持你們現在的利潤率水準？

Yes. Paul, I think overall, we're achieving overall price increase levels that are in excess overall of the prospective loss ratio trends in our business. In some businesses, those increases might lead to returns that exceed our targets. In other businesses, they would lead towards meeting our targets. I think we're blessed today except for a few businesses, almost all of our businesses are meeting the targeted returns.

是的，Paul。我想整體而言，我們達成的整體價格上調幅度，整體上高於我們業務的前瞻損失率（prospective loss ratio）趨勢。在某些業務中，這些上調可能帶來超過我們目標的報酬；在其他業務中，則會使報酬更接近並達成我們的目標。我認為我們很幸運，除了少數幾個業務外，幾乎所有業務都達到目標報酬。

Great. Maybe we could turn to capital management a little bit. I think in the past, you've talked about the stock being attractive in your view and you've got sort of 10x, 11x EPS, which is kind of where it's been. But you haven't seen a huge aggressive amount of stock repurchased. You've focused more on special dividends. Is that still kind of your view? Or is there a different view on allocation of capital because of the M&A environment or just your general thoughts on how those pieces all fit together?

很好。也許我們可以談一下資本管理。我記得過去你們提到，從你們的角度看股票很有吸引力，而且本益比大概 10 倍、11 倍 EPS，差不多一直在那個水準。但你們並沒有看到非常積極的大量庫藏股回購；你們更著重於特別股利。這仍然是你們的看法嗎？還是因為併購（M&A）環境或你們對資本配置有不同看法，或是你們對這些要素如何整合的整體想法？

Yes, I think every year is a different mix based on -- we take an opportunistic approach. We think our stock is especially attractively valued. We've shown over this in the past year that we've been in the market repurchasing shares and value that. Where we're generating large amounts of excess capital at these kinds of returns, special dividends can also be important. But obviously, priorities are organic growth, building the business itself. We are tough buyers on the M&A side, but we look at lots of things and we're always starting businesses, building businesses and acquiring things that make sense and can earn double-digit returns for us over time. You've seen the increase in our annual dividend has been substantial over time. So we also think our shareholders value a consistent increase in our annual dividend also. That's still the way we think about things. Each year is going to be a different mix.

是的，我認為每一年都會因為不同因素而有不同的組合——我們採取機會主義的方法。我們認為我們的股票估值特別具吸引力；過去一年你也看到我們在市場上回購股份，並重視這件事。在這類報酬水準下我們產生大量超額資本時，特別股利也可能很重要。但顯然，我們的優先事項是有機成長、打造業務本身。在併購方面我們是嚴格的買方，但我們會看很多機會；我們也一直在開創業務、建置業務，並在合理時收購能夠隨時間為我們帶來雙位數報酬的資產。你也看到我們的年度股利隨時間顯著提高。因此我們也認為股東同樣重視年度股利的持續成長。這仍是我們看待事情的方式；每一年都會是不同的組合。

Great. Always appreciate the help. I'll let some other folks ask questions. Thank you.

太好了。一直很感謝你們的協助。我先讓其他人提問。謝謝。

Thank you. Our next question comes from the line of Michael Zaremski with BMO Capital Markets.

謝謝。下一個問題來自 BMO Capital Markets 的 Michael Zaremski。

Hey, great. Good afternoon. Just kind of wanted to make sure as we think through the combined ratio guidance for next year and what ultimately equates to a very strong ROE, of course. If we reflect on 2023 a bit, in an investors' minds, there was a bit of a pothole from kind of social inflationary adverse development. I believe crop was a little below normal. There was an A&E kind of ding, maybe 1% to 2% on earnings. So I guess just want to make sure like that, I'm thinking about those correctly. So on a go-forward basis, you don't expect the combined ratio to improve just because, I guess, maybe pricing can excess a trend, but just the trend is still -- I guess I'm just trying to think through like am I missing something? I guess the trend is maybe moving a little higher, pricing is moving higher, but just returns might not be as excellent if I, even if I ex out those items I just started kind of calling out.

嗨，很好。下午好。我只是想確認一下，當我們思考明年的綜合率指引，以及最終對應到非常強勁的 ROE（股東權益報酬率）時，當然是如此。如果我們稍微回顧一下 2023 年，在投資人心中，因為社會通膨導致的不利準備金發展，似乎出現了一個小坑。我認為作物險表現略低於正常。A&E 也有點拖累，可能對獲利影響約 1% 到 2%。所以我想確認一下，我這樣理解是否正確。那麼往後看，你們不預期綜合率會改善只是因為——我猜可能是定價可以超過趨勢，但趨勢仍然——我想我只是想釐清，我是不是漏掉了什麼？我猜趨勢可能在往上走一點，定價也在提高，但如果我把剛剛提到的那些項目排除掉，報酬可能就不會那麼出色？

I think the return is very similar, and we're projecting our business plans for a combined ratio that's at the same level of a really great year. Certainly, in comparison to our peers, that's one of the stronger performances on underwriting and on return on equity.

我認為報酬其實非常相近，而我們在業務計畫中所預測的綜合率，會維持在一個非常優秀年度的同一水準。當然，與同業相比，這在承保表現與股東權益報酬率方面都是較強的表現之一。

So we're proud of those results. And there will be businesses that as in workers' comp, in this year that had less favorable development, that have outstanding results when you look back on this year, but the underwriting profit wasn't as large. There's businesses, as you said, like crop hail that had a below average year and in our business plan, the way it fits together as we, in the past, we've, when we were giving guidance, we said we were planning for an average crop year. So that's, the way we build our plan is really consistent with the way that we used to give guidance as far as how we would get there. Our guidance was generally based off of our business plan in the past.

所以我們對這些結果感到自豪。確實會有一些業務，例如今年的勞工補償險，準備金發展較不有利；回頭看今年的結果仍然很出色，但承保利潤就沒有那麼大。也有一些業務如你所說，像作物冰雹險（crop hail）今年低於平均水準；而在我們的業務計畫中，整體搭配方式是——過去我們在提供指引時，曾說我們是以「平均作物年度」來規劃。因此，我們建構計畫的方式，與過去提供指引時所採用的假設非常一致，也就是我們如何達成目標。過去我們的指引通常是以業務計畫為基礎。

Mike, this is Craig. One thing that I think you need to recognize in this year's plan is an assumption on return on alternatives that is somewhat below the historical level and certainly below what we expect to see on a go-forward basis. We have $2.4 billion invested in alternatives. About half of that is invested in multi-family and the balance in more traditional private equity investments. And in our plan for 2024, we're assuming a low single-digit return on our multi-family properties and a high single-digit return on the balance of our alternative investments.

Mike，我是 Craig。我認為你需要注意今年計畫中的一點：對替代性投資報酬的假設略低於歷史水準，且也低於我們對未來的預期。我們有 24 億美元投資在替代性資產上，其中約一半投資於多戶住宅（multi-family），其餘則是較傳統的私募股權投資。而在我們 2024 年的計畫中，我們假設多戶住宅資產的報酬為低個位數，而其餘替代性投資的報酬為高個位數。

To give a little color on our view of multi-family, we still like the asset class longer term. We've generated fantastic returns in the past. As I said in the conference call script, we've averaged a 15% annual return over the last 5 years. We are in very attractive markets. Florida and Colorado represent 53% of our multi-family investments; Dallas, Phoenix and North Carolina another 27%. They're markets with very strong population growth. So the new builds in the recent past, the bulk of the new builds have been at attractive markets with population growth, that is impacting our ability to push rates the way we have in the recent past. So we think it's going to take 12 to 18 months to work through this new inventory, the new supply of multi-family properties. And then we do expect that we will have the ability to push rental rates more in line with what we've done in the recent past and generate strong returns.

補充一些我們對多戶住宅的看法：長期而言我們仍然看好這個資產類別，過去也創造了非常出色的報酬。如我在電話會議講稿中所說，過去 5 年我們平均年化報酬為 15%。我們所在的市場非常具吸引力：佛羅里達與科羅拉多占我們多戶住宅投資的 53%；達拉斯、鳳凰城與北卡羅來納再占 27%。這些市場的人口成長非常強勁。因此，近期新增建案的大部分都集中在這些具人口成長的優質市場，這正在影響我們像過去那樣推升租金的能力。我們認為需要 12 到 18 個月來消化這些新增庫存、也就是多戶住宅物件的新供給。之後我們預期將能更有能力推升租金，使其更貼近過去的水準，並創造強勁報酬。

But if you, our long-term expectations on alternative investments would be for a return of 10% plus, historically, we've done better than that. If you normalize this year's return and use 10% as kind of a normalized number, it would add $0.90 per share to the EPS, which is about a point and a half of ROE.

但如果看我們對替代性投資的長期預期，報酬應該是 10% 以上；歷史上我們做得更好。若將今年的報酬正常化，並以 10% 作為一個「正常化」的數字，將可使每股盈餘（EPS）增加 0.90 美元，約相當於 ROE 增加 1.5 個百分點。

So I think that is something that investors need to recognize because of our significant multi-family exposure, which near term is going to hurt these returns, it's an unusually low return expectation for this calendar year. And I think that needs to be normalized when you take a look at this year's earnings expectations.

所以我認為投資人需要注意這一點：由於我們在多戶住宅的曝險比重較大，短期內會壓抑這些報酬，使得本曆年（calendar year）的報酬預期異常偏低。我認為在檢視今年的獲利預期時，需要將其正常化。

Okay. Okay. That helps. I think investors will understand that. Okay. Lastly, and this might be for Brian. Just on triangulating the excess capital and the parent company cash and all those moving parts, I believe the debt to capital, if I'm thinking about it the right way, is below the company's kind of, maybe it's a max threshold of 30%? Or I don't know if it's a target of 30%? You can clarify that. But if, is there, would there be an option to issue some debt in the future potentially to release excess capital to the extent there weren't M&A opportunities? Or is that not something we should be thinking about as a lever? Thanks.

好的。好的。這很有幫助。我想投資人會理解。好的。最後一個問題，可能要問 Brian。關於超額資本、母公司現金以及所有這些變動項目的交叉比對，我的理解是，若我想得沒錯，負債對資本比率（debt to capital）低於公司所謂的——也許是 30% 的上限門檻？或者我不確定那是 30% 的目標值？你可以澄清一下。但如果是這樣，未來是否可能選擇發行一些債務，以在沒有併購（M&A）機會的情況下釋放超額資本？還是說這不是我們應該視為一個槓桿的選項？謝謝。

So yes. So the 30% is sort of a guideline for us. So we would look at as our maximum, not that we couldn't go over that, if the opportunity presented itself. But that does leave open the possibility for borrowing money at the right rate and the right environment to move towards that ratio if it makes sense from a long-term value creation for shareholders' perspective. So it would be on the table, but not in our immediate plan.

是的。30% 對我們而言算是一個指引。因此我們會把它視為上限——並不是說如果有機會我們就不能超過，但它確實保留了在合適利率與合適環境下借款、並在合理情況下朝該比率靠攏的可能性，前提是從為股東創造長期價值的角度來看是合理的。所以這會是一個選項，但不在我們近期計畫之內。

Thank you.

謝謝。

(Operator Instructions) Our next question comes from the line of Andrew Andersen with Jefferies.

（接線員指示）下一個問題來自 Jefferies 的 Andrew Andersen。

Hey, good afternoon. In the press release, you mentioned lower underwriting profit in E&S. Could you expand a bit on that? Was that just large losses on Property or Casualty? And does it reflect a change in underlying loss trend assumption?

嗨，下午好。在新聞稿中，你們提到 E&S 的承保利潤較低。可以多說一些嗎？那只是因為財產險或意外險出現大額損失嗎？這是否反映你們對基礎損失趨勢假設有所改變？

Yes. I think the quarter was in the 80s. The combined ratio for the overall but you got to put that in perspective. So, the quarter had an outstanding combined ratio and to start with. And when you, as Brian said, when you put it in the perspective of the whole year, there was, the difference in the reserve development was less favorable workers' comp for the whole year, some impact from social inflation. And in some quarters, some large loss on the Casualty side activity. I think that's the right way to look back and if you're trying to look at trends for us.

是的。我認為該季度大概在 80 多（綜合率）。整體的綜合率是如此，但你必須把它放在脈絡中看。因為該季度本身就有非常出色的綜合率。並且如 Brian 所說，當你把它放到全年來看，準備金發展的差異主要是全年勞工補償險較不有利，受到一些社會通膨影響；而在某些季度，意外險端也有一些大額損失活動。我認為如果你想回頭看、並試著判斷我們的趨勢，這樣看是對的。

Thank you. And are you seeing any change in the competitive environment within E&S?

謝謝。那你們在 E&S 的競爭環境方面，有看到任何變化嗎？

I think maybe a bit more competition on, we're not on the E&S property side. We've been expanding our property business on the E&S side. It seems like some more interest in that sector and some more competition there. I think on the positive side, other interesting things I think we're seeing on the D&O side where the pricing has been down double digit. In the fourth quarter, we saw it being down single digit, which I saw as a positive trend, and we've thought that there have been too many competitors, too much capital and pricing levels that don't make sense in public D&O. So that was positive. I think another positive thing we saw in the fourth quarter on the pricing front, was our commercial auto pricing there in National Interstate and Vanliner moved to double digit to 10% plus, which I see as a positive competitive sign.

我認為可能在——我們不做 E&S 的財產險端。我們一直在 E&S 端擴張我們的財產險業務。看起來該領域有更多興趣，也有更多競爭。正面來看，我們在 D&O 端看到一些有趣的變化：定價一直是雙位數下跌；在第四季，我們看到跌幅變成個位數，我把這視為正向趨勢。我們一直認為公開市場 D&O 的競爭者太多、資本太多，而定價水準不合理，所以這是正面的。另一個我們在第四季定價面看到的正向訊號是，我們在 National Interstate 與 Vanliner 的商用車險定價回到雙位數、也就是 10% 以上，我認為這是競爭環境改善的正面訊號。

Thanks. And maybe just a quick numbers question. $34 million of other expense in the quarter. I suspect that's a higher amortization from CRS, but is that kind of a good run rate for this line time in '24?

謝謝。再問一個快速的數字問題。本季其他費用為3,400萬美元。我猜這是CRS帶來較高的攤銷，但這條目在2024年是否可視為一個不錯的常態水準？

So it looks like you're looking at our line item for sort of other corporate expenses. So what falls into that line is really everything that's not part of our Property and Casualty operations and then we show the interest expense separately. So that's mostly holding company expenses in that line. But it's also net of any investment income earned by the parent company. So there's a couple of things going on there in the quarter when you compare it to previous quarters, particularly in the fourth quarter of 2022. One of the bigger things in there is that during the fourth quarter of 2023, we had lower levels of cash and investment balances at the parent company as we tend to keep most of our cash and investments down in the P&C operations. So the investment income that sort of netted into that number is about $4 million lower in 2023 compared to 2022 in the same quarter. And then also in the fourth quarter of 2023, we just happened to have a couple of sort of one-off elevated expenses, and that was magnified by a benefit in the fourth quarter of 2022.

看起來你是在看我們的「其他公司費用」這個科目。這個科目包含的其實是所有不屬於我們財產與意外險（P&C）營運的項目，而利息費用我們則另外單獨列示。所以那一行主要是控股公司費用，但也會扣除母公司所賺取的任何投資收益。因此，當你把本季與前幾季比較，特別是與2022年第四季相比時，這一季有幾件事情同時發生。其中特別大的一點是，2023年第四季母公司的現金與投資餘額較低，因為我們通常把大部分現金與投資放在P&C營運端。因此，計入該數字中用以抵減的投資收益，在2023年同季相較2022年約少了400萬美元。另外，2023年第四季我們剛好也有幾筆一次性的較高費用，而這個差異又因為2022年第四季有一項利益而被放大。

In the fourth quarter of 2022, we had a benefit related to some employee benefit plans that are tied to the stock market, that didn't recur this year. So when you look at the things in the fourth quarter of 2023 versus the 2022 quarter that are different, I would say the lower parent company investment income, which is about $4 million, that's probably something that would go forward, and I would consider it if we're looking at a run rate. The other items are really sort of one-off things that could happen in any quarter, but I wouldn't consider them something that I would put in the run rate.

在2022年第四季，我們有一項與某些與股市連動的員工福利計畫相關的利益，今年並未再發生。因此，當你看2023年第四季相較2022年第四季的差異時，我會說母公司投資收益較低（約400萬美元）這點，可能會延續到未來，若要看常態水準我會把它納入考量。其他項目則比較屬於一次性事件，任何一季都可能發生，但我不會把它們視為應納入常態水準的項目。

Yeah I want to go back on the E&S umbrella and excess liability business, just to be clear. When you look at, if you would just look at that part of our business in the fourth quarter, it would be in line with what the combined ratio was for the whole year in that. And we had ended up with excellent underwriting results in E&S, umbrella and excess liability overall.

是的，我想回到E&S的雨傘險與超額責任險業務，再澄清一下。若你只看我們該業務在第四季的表現，它會與該業務全年綜合比率的水準一致。而我們在E&S、雨傘險與超額責任險整體上，最終取得了非常優異的核保結果。

Thank you very much.

非常感謝。

Thank you. Our next question comes from the line of Meyer Shields with Keefe, Bruyette, & Woods.

謝謝。下一個問題來自Keefe, Bruyette, & Woods的Meyer Shields。

Great. Thanks so much. In terms of understanding, I don't want to call it guidance anymore, but the expectations. There are a few companies out there who provide some sort of outlook for combined ratio and explicitly say that, that does not include reserve development. I just want to understand whether we should look at your expectations the same way or whether maybe there's some measure of reserve release anticipated?

很好，謝謝。在理解方面，我不想再稱之為「指引」，但就是「預期」。市面上有幾家公司會提供某種綜合比率的展望，並明確表示其中不包含準備金發展。我想了解，我們是否也應以同樣方式看待你們的預期，或者是否可能預期會有某種準備金釋放？

Hi. This is Brian. So when we look at our combined ratio overall, we feel like we set our reserves optimistically and conservatively and we're optimistic about the potential for future favorable prior development that we wouldn't explicitly disclose any kind of components of our combined ratio. I think it's important to know that we think our reserve position is very strong. And if you look at our plan for 2024, we did react to the higher frequency of catastrophe losses that occurred in 2023, along with cat experiences in other recent years. We look at things like social inflation, we've been really focused on price increases, terms and conditions like catastrophe points and retention. And so we're sort of good about the actions in that area. So if you look overall, I think while we wouldn't explicitly put anything in there to say anything about prior year development, we're optimistic that we could have some and feel good about where our reserves are.

嗨，我是Brian。當我們看整體綜合比率時，我們認為我們在提列準備金時既樂觀也保守；我們也對未來可能出現有利的前期年度發展抱持樂觀，但我們不會明確揭露綜合比率的任何組成項目。我認為重要的是，你要知道我們認為我們的準備金部位非常強健。再看我們2024年的計畫，我們確實因應了2023年巨災損失發生頻率較高的情況，以及近年其他年度的巨災經驗。我們也會考量社會通膨；我們一直非常專注於調漲價格、條款與條件（例如巨災點數與自留額）。因此，我們對在這些方面採取的行動感到滿意。整體而言，雖然我們不會明確在其中加入任何關於前期年度發展的說法，但我們對可能會有一些有利發展抱持樂觀，並且對我們的準備金水準感到放心。

Okay. Perfect. I just wanted to understand what the expectation entails. Carl, you mentioned some timing issues with regard to Transportation. I was hoping you could flesh that out?

好的，很好。我只是想了解這個預期包含哪些內容。Carl，你提到運輸（Transportation）方面有一些時點問題。我希望你能再多說明一下？

I'm not, could you repeat that? I couldn't -- unsure what the question was?

我不太——你可以重複一下嗎？我沒聽清楚——不太確定問題是什麼？

I'm sorry. So when you're talking about the Property and Transportation segment, you mentioned some timing, I think, with regard to fourth quarter premium growth. And just looking to understand whether some of that was deferred to the first quarter of '24? Or how we should think about that?

不好意思。你在談財產與運輸（Property and Transportation）部門時，我記得你提到一些時點因素，與第四季保費成長有關。我想了解其中是否有部分遞延到2024年第一季？或者我們應該如何看待這件事？

It's really the timing between quarters some stuff moved to other quarters. Sometimes things renew in a different month or have a different policy term with things like that.

主要就是季度之間的時點差異，有些業務移到其他季度。有時候是續保落在不同月份，或保單期間不同之類的原因。

Okay. And then one final question. Outside of crop, can you talk about your expectations for reinsurance purchasing in 2024 versus 2023?

好的。最後一個問題。除了農作物（crop）之外，你能談談你們對2024年相較2023年的再保採購預期嗎？

So you're talking about reinsurance in general across all of our lines?

所以你指的是我們所有線別整體的再保嗎？

Yes.

是的。

So separating out the cat program from our just traditional other non-cat reinsurance? Or are you focusing on the cat?

是要把巨災方案（cat program）與我們傳統的其他非巨災再保分開來看？還是你主要聚焦在巨災？

Both.

兩者都想了解。

On the catastrophe reinsurance side, so we did renew our property cat treaty here for 2024. The attachment point for that cat treaty moved up some from 2023, mostly due to our increased exposure as we have increased property exposures in both our E&S business and in our financial institutions business. So we'll be attaching at a $70 million level instead of a $50 million level. So if you think about our property cat reinsurance tower, so the retention is $70 million. We then have traditional reinsurance for $55 million in excess of the $70 million. And then our cat bond comes in on top of that providing a coverage for the vast majority of any single event up to $450 million, and that cat bond is in place through the end of 2024. So the cost of the reinsurance, so we're buying less coverage. The risk-adjusted rate is actually slightly lower for that cost in 2024 than it was in 2023.

在巨災再保方面，我們已完成2024年的財產巨災合約續約。該巨災合約的起賠點相較2023年有所上調，主要是因為我們的曝險增加——我們在E&S業務以及金融機構業務中的財產曝險都有所增加。因此，我們的起賠點將在7,000萬美元，而不是5,000萬美元。若你看我們的財產巨災再保塔（tower），自留額為7,000萬美元；接著我們有傳統再保，提供在7,000萬美元之上超額5,500萬美元的保障；然後我們的巨災債券（cat bond）在其上方介入，對單一事件提供保障，涵蓋絕大部分損失，最高可達4.5億美元，而該巨災債券有效至2024年底。至於再保成本方面，由於我們買的保障較少，風險調整後的費率在2024年其實略低於2023年。

As far as reinsurance outside of the property cat cover, our business units look at that year-by-year and business unit by business unit to purchase reinsurance where they think that it provides an attractive balance of risk and return for the company. So there's no real overall trend there. I wouldn't expect our reinsurance retentions to be super different when you look across the company as a whole in 2024 versus 2023, but we are careful at each business unit in determining the right coverage each year.

至於財產巨災保障以外的再保，我們各業務單位會逐年、逐單位評估，在他們認為能為公司提供具吸引力的風險與報酬平衡時才購買再保。因此，整體上沒有明顯的趨勢。若以公司整體來看，我不預期2024年相較2023年的再保自留額會有非常大的差異，但我們會在每個業務單位謹慎地逐年決定適當的保障。

Alright, perfect. Thank you so much.

好，太好了。非常感謝。

Thank you. And I'm currently showing no further questions at this time. I'd like to hand the call back over to Diane Weidner for closing remarks.

謝謝。目前顯示暫無其他提問。我想把電話交回給Diane Weidner做結語。

Thank you, Shannon, and thank you all for joining us this morning as we reviewed our fourth quarter and full year results for 2023. We look forward to talking with you all again next quarter. Hope you all have a great day.

謝謝你，Shannon，也謝謝各位今天早上加入我們，一同回顧我們2023年第四季與全年業績。我們期待在下個季度再次與各位交流。祝各位今天愉快。

This concludes today's conference call. Thank you for your participation. You may now disconnect.

今天的電話會議到此結束。感謝各位參與。您現在可以掛線。