American Financial Group Inc (AFG) 2024 Q3 法說會逐字稿

Good day and thank you for standing by. Welcome to the American Financial Group third quarter 2024 conference call (Operator Instructions). Please be advised that today's conference call is being recorded.

美好的一天，感謝您的支持。歡迎參加美國金融集團 2024 年第三季電話會議（操作員說明）。請注意，今天的電話會議正在錄音。

I would now like to hand the conference over to your first speaker, Diane Weidner, Vice President of Investor Relations. Please go ahead.

現在我想將會議交給第一位發言人、投資者關係副總裁黛安·韋德納 (Diane Weidner)。請繼續。

Thank you. Good morning, and welcome to American Financial Group's third quarter 2024 earnings results conference call. We released our 2024 third quarter results yesterday afternoon. Our press release, investor supplement, and webcast presentation are posted on AFG's website under the Investor Relations section. These materials will be referenced during portions of today's call.

謝謝。早安，歡迎參加美國金融集團 2024 年第三季財報電話會議。昨天下午我們發布了 2024 年第三季業績。我們的新聞稿、投資者補充資料和網路廣播簡報發佈在 AFG 網站的投資者關係部分。這些資料將在今天電話會議的部分內容中引用。

I'm joined this morning by Carl Lindner III and Craig Lindner, Co-CEOs of American Financial Group, and Brian Hertzman, AFG's CFO.

今天上午，美國金融集團(American Financial Group) 聯合首席執行官卡爾·林德納三世(Carl Lindner III) 和克雷格·林德納(Craig Lindner) 以及AFG 首席財務官布萊恩·赫茲曼(Brian Hertzman) 也加入了我的行列。

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.

在我將討論交給 Carl 之前，我想提請您注意我們網路廣播投影片 2 上的註解。今天要討論的一些問題具有前瞻性。這些前瞻性陳述涉及某些風險和不確定性，可能導致我們的實際結果和/或財務狀況與這些陳述有重大差異。這些風險和不確定性的詳細描述可以在 AFG 向美國證券交易委員會提交的文件中找到，這些文件也可以在我們的網站上找到。

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.

我們可能會在我們的評論或回答問題時提及核心淨營業收入（一種非公認會計原則財務指標）。我們的收益報告中包含了淨利潤與核心淨營業收益的調節表。

And finally, if you're 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.

最後，如果您正在閱讀本次電話會議的文字記錄，請注意，它可能未經授權或未經審查其準確性，因此，它可能包含事實或轉錄錯誤，這些錯誤可能會嚴重改變我們聲明的意圖或含義。

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

現在，我很高興將電話轉給卡爾林德納三世，討論我們的結果。

Good morning. I'll begin my remarks by sharing a few highlights of AFG's 2024 third quarter, after which Craig and I will walk through more details. We will then open it up for Q&A, where Craig, Brian and I will be happy to respond to your questions.

早安.我將首先分享 AFG 2024 年第三季的一些亮點，然後克雷格和我將介紹更多細節。然後我們將進行問答，克雷格、布萊恩和我將很樂意回答您的問題。

I'm pleased to report an annualized third quarter core operating return on equity of 16%. Underwriting margins in our Specialty Property and Casualty insurance businesses held up nicely despite elevated catastrophe losses particularly from Hurricane Helene during the quarter, and higher interest rates increased property and casualty net investment income by 15% year over year. Craig and I thank God, our talented management team and our great employees for helping us to achieve these results.

我很高興地報告第三季核心營運股本年化報酬率為 16%。儘管本季巨災損失（特別是颶風海倫）造成的損失增加，但我們的專業財產和意外傷害保險業務的承保利潤仍保持良好，而且利率上升使財產和意外傷害淨投資收入同比增長了15% 。克雷格和我感謝上帝、我們才華橫溢的管理團隊和優秀的員工幫助我們取得了這些成果。

I'll now turn the discussion over to Craig to walk us through some of the details.

現在我將把討論轉交給克雷格，讓他向我們介紹一些細節。

Thank you, Carl. Please turn to slides 3 and 4 for a summary of earnings information for the quarter. AFG reported core net operating earnings of $2.31 per share in the 2024 third quarter. Higher year-over-year catastrophe losses related primarily to Hurricane Helene and lower favorable prior year reserve development in the P&C insurance operations were partially offset by higher investment income.

謝謝你，卡爾。請參閱投影片 3 和 4，以了解本季收益資訊摘要。AFG 報告 2024 年第三季核心淨營運收益為每股 2.31 美元。主要與颶風海倫有關的巨災損失同比增加以及財產和意外傷害保險業務上一年有利準備金開發的減少被較高的投資收入部分抵消。

Now I'd like to turn to an overview of AFG's investment performance and financial position and share a few comments about AFG's capital and liquidity. The details surrounding our $15.7 billion investment portfolio are presented on slides 5 and 6.

現在我想概述一下AFG的投資績效和財務狀況，並分享一些關於AFG的資本和流動性的評論。投影片 5 和 6 介紹了我們 157 億美元投資組合的詳細資訊。

Looking at results for the third quarter, property and casualty net investment income was approximately 15% higher than the comparable 2023 period, reflecting the impact of rising interest rates, higher balances of invested assets, and higher returns on alternative investments.

從第三季的業績來看，財產和傷亡淨投資收入比 2023 年同期高出約 15%，反映了利率上升、投資資產餘額增加以及另類投資回報率上升的影響。

As you'll see on slide 6, approximately 67% 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 5% yield earned on fixed maturities in our P&C portfolio during the third quarter of 2024. The duration of our P&C fixed maturity portfolio, including cash and cash equivalents, was 2.9 years at September 30, 2024.

正如您將在投影片 6 中看到的，我們的投資組合中約 67% 投資於固定期限債券。在當前的利率環境下，我們能夠以約 5.5% 的收益率投資於固定期限證券。與 2024 年第三季我們的財產和意外投資組合中固定期限的 5% 收益率相比，目前的再投資利率相當不錯。截至 2024 年 9 月 30 日，我們的財產和意外傷害固定期限投資組合（包括現金和現金等價物）的久期為 2.9 年。

The annualized return on alternative investments in our P&C portfolio was approximately 5.4% for the 2024 third quarter compared to 4.2% for the prior year quarter. Longer term, we continue to remain optimistic regarding the prospects of attractive returns from our alternative investments with an expectation of annual returns averaging 10% or better.

2024 年第三季度，我們的財產和意外傷害投資組合的另類投資年化報酬率約為 5.4%，去年同期為 4.2%。從長遠來看，我們繼續對另類投資的誘人回報前景保持樂觀，預計年回報率平均為 10% 或更高。

Please turn to slide 7, where you'll find a summary of AFG's financial position at September 30, 2024. During the quarter, we returned $59 million to our shareholders through the payment of our regular quarterly dividend. In conjunction with our earnings release, we declared a special dividend of $4.00 per share, payable on November 26, 2024, to shareholders of record on November 15, 2024. The aggregate amount of the special dividend will be approximately $335 million. This special dividend is in addition to the company's regular quarterly cash dividend of $0.80 per share, which was recently increased 12.7% over the previously declared rate and paid on October 25, 2024.

請前往投影片 7，您可以在其中找到 AFG 截至 2024 年 9 月 30 日的財務狀況摘要。本季度，我們透過定期支付季度股息向股東返還 5,900 萬美元。在發布財報的同時，我們宣布派發每股 4.00 美元的特別股息，將於 2024 年 11 月 26 日支付給 2024 年 11 月 15 日登記在冊的股東。特別股息總額約3.35億美元。此次特別股息是在該公司每股 0.80 美元的定期季度現金股息之外支付的，該股息最近比之前宣布的股息率增加了 12.7%，並於 2024 年 10 月 25 日支付。

With this special dividend, the company has declared $50.00 per share, or $4.2 billion, in special dividends since the beginning of 2021, including $6.50 per share in 2024. Carl and I consider these special dividends to be an important component of our total shareholder return. We expect our operations to continue to generate significant excess capital throughout the remainder of 2024 and into 2025, which provides ample opportunity for acquisitions, special dividends or share repurchases over the next year.

憑藉此次特別股息，該公司自 2021 年初以來已宣布派發每股 50.00 美元，即 42 億美元的特別股息，其中 2024 年為每股 6.50 美元。卡爾和我認為這些特別股利是我們股東總報酬的重要組成部分。我們預計我們的業務將在 2024 年剩餘時間和 2025 年繼續產生大量過剩資本，這為明年的收購、特別股息或股票回購提供了充足的機會。

For the three and nine months ended September 30, 2024, AFG's growth in book value per share excluding AOCI plus dividends, was 4.0% and 13.9%, respectively. Our strong operating results, coupled with effective capital management and our entrepreneurial, opportunistic culture and disciplined operating philosophy enable us to continue to create value for our shareholders.

截至 2024 年 9 月 30 日的三個月和九個月，不包括 AOCI 和股息的 AFG 每股帳面價值增長率分別為 4.0% 和 13.9%。我們強勁的經營業績，加上有效的資本管理以及我​​們的創業、機會主義文化和嚴格的經營理念，使我們能夠繼續為股東創造價值。

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

現在我將把電話轉回卡爾，討論我們的財產與意外傷害業務的結果。

Thanks, Craig. Please turn to slides 8 and 9 of the webcast, which include an overview of our third quarter results. As you'll see on slide 8, our Specialty Property and Casualty insurance businesses generated a 94.3% combined ratio in the third quarter of 2024, 2.1 points higher than what we reported in the third quarter of 2023. Results for the 2024 third quarter included 4.4 points of catastrophe losses, compared to 3.0 points in the third quarter last year.

謝謝，克雷格。請參閱網路廣播的幻燈片 8 和 9，其中包括我們第三季業績的概述。正如您在幻燈片8 中看到的那樣，我們的專業財產和意外傷害保險業務在2024 年第三季的綜合成本率為94.3%，比我們在2023 年第三季報告的數據高出2.1 個百分點。2024 年第三季的業績包括 4.4 個百分點的災難損失，而去年第三季為 3.0 個百分點。

Losses from Hurricane Helene represented about two-thirds of our catastrophe losses in the third quarter. No named storm exceeded our corporate property cat retention of $70 million during the quarter, and we believe our careful management of coastal exposures has served us well over many years. The losses we incurred from Hurricane Helene were not driven by coastal exposure, with the vast majority of these losses coming from non-coastal areas in Georgia and the Carolinas.

颶風海倫造成的損失約佔第三季災難損失的三分之二。本季沒有任何已知的風暴超過了我們公司財產貓保留的 7000 萬美元，我們相信，我們對沿海風險的精心管理多年來一直為我們提供了良好的服務。我們因颶風海倫而遭受的損失並不是由​​沿海地區造成的，其中絕大多數損失來自喬治亞州和卡羅來納州的非沿海地區。

Although our remarks are focused on third quarter results today, I'd like to comment on estimated losses from Hurricane Milton, which made landfall in Florida on October 9. We currently estimate that pre-tax losses from Hurricane Milton will be about $30 million and will be reflected in our fourth quarter results.

儘管我們今天的演講重點是第三季業績，但我想對 10 月 9 日登陸佛羅裡達州的颶風米爾頓的估計損失發表評論。我們目前估計颶風米爾頓造成的稅前損失約為 3000 萬美元，並將反映在我們第四季的業績中。

Results in the third quarter benefited from eight-tenths of a point of favorable prior year reserve development compared to 2.3 points in the third quarter of 2023. Prior year reserve development continued to be favorable within each of our Specialty Property and Casualty Groups during the third quarter. Favorable prior year reserve development in our workers' compensation businesses, along with several other businesses, more than offset some adverse development in selected social inflation exposed casualty businesses.

第三季的業績受惠於去年十分之八的有利儲備發展點，而 2023 年第三季為 2.3 個點。第三季度，我們每個特種財產和傷亡險集團的去年儲備金發展繼續有利。我們的工人賠償業務以及其他幾項業務上一年的準備金發展良好，足以抵消某些受社會通貨膨脹影響的傷亡業務的不利發展。

Third quarter 2024 gross and net written premiums were up 19% and 14%, respectively, when compared to the third quarter of 2023, driven primarily by additional premiums from the Crop Risk Services acquisition. Gross and net written premiums excluding crop insurance each grew 7% year over year. We continue to achieve year-over-year premium growth as a result of a combination of new business opportunities, increased exposures, and a good renewal rate environment.

與 2023 年第三季相比，2024 年第三季的毛保費和淨保費分別成長了 19% 和 14%，這主要是由於收購 Crop Risk Services 帶來的額外保費推動的。不包括農作物保險的總承保保費和淨承保保費較去年同期分別增加 7%。由於新的商業機會、風險增加和良好的續保費率環境，我們繼續實現保費同比增長。

Average renewal pricing across our Property and Casualty Group, excluding our workers' comp businesses, was up approximately 8% in the third quarter, and up approximately 7% overall. Third quarter average overall renewal pricing was about 1% higher than pricing increases achieved in the second quarter. We've reported overall renewal rate increases for 33 consecutive quarters, and we believe we are achieving overall renewal rate increases in excess of prospective loss ratio trends to meet or exceed targeted returns.

我們的財產和意外險集團（不包括工人補償業務）的平均續約價格在第三季上漲了約 8%，整體上漲了約 7%。第三季平均整體續訂價格比第二季的價格漲幅高出約 1%。我們已經連續 33 個季度報告整體續訂率成長，我們相信我們正在實現超過預期損失率趨勢的總體續訂率成長，從而達到或超過目標回報。

Now I'd like to turn to slide 9 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. The businesses in the Property and Transportation group achieved a 96.5% calendar year combined ratio overall in the third quarter of 2024, 1.7 points higher than the 94.8% reported in the comparable '23 period. Higher year-over-year underwriting profit in our agricultural businesses was more than offset by higher catastrophe losses, primarily from Hurricane Helene.

現在我想翻到第 9 張投影片，回顧我們每個專業財產和傷亡業務部門的一些亮點。詳細資訊包含在我們的收益發布中，因此我將在這裡重點介紹總結結果。2024 年第三季度，房地產和運輸集團的業務總體日曆年度綜合成本率為 96.5%，比 23 年同期的 94.8% 高出 1.7 個百分點。我們農業業務年比承保利潤的增加被主要來自颶風海倫的災難損失增加所抵消。

Third quarter 2024 gross and net written premiums in this group were 32% and 26% higher, respectively, than the comparable prior year. The primary drivers of the growth included additional premiums from the Crop Risk Services acquisition and to a lesser extent, later reporting of crop acreage, which shifted the timing of reporting of some crop premium from the second quarter to the third quarter of 2024. Excluding crop premiums, third quarter gross and net written premiums each grew 11% year-over-year in this group, which is attributable primarily to new business opportunities, a favorable rate environment and increased exposures in our commercial auto, property & inland marine and ocean marine businesses.

該組 2024 年第三季的毛保費和淨保費分別比去年同期高出 32% 和 26%。成長的主要驅動力包括作物風險服務收購帶來的額外保費，以及在較小程度上，後來報告的作物面積，這將部分作物保費的報告時間從第二季度改為 2024 年第三季。不包括農作物保費，該集團第三季​​毛保費和淨承保保費分別年增11%，這主要歸因於新的商機、有利的費率環境以及我們在商用汽車、房地產和內陸海事領域的風險敞口增加。

Crop insurance premiums represented about half of the net earned premiums in this group for the third quarter of 2024, reflecting the seasonality of the crop business and growth from the CRS acquisition. Consistent with historical practice, we record results in the current year to a combined ratio in the high 90s, which, particularly in the third quarter, elevates our overall combined ratio to some extent until we have better visibility into our full year crop results. The majority of the calendar year crop profitability is generally reflected in our fourth quarter financial statements.

農作物保險保費約佔 2024 年第三季該組淨保費的一半，反映了農作物業務的季節性以及 CRS 收購帶來的成長。與歷史慣例一致，我們今年的業績記錄為綜合成本率在90 左右的高位，這在一定程度上提高了我們的整體綜合成本率，特別是在第三季度，直到我們更好地了解全年作物業績。歷年作物獲利能力的大部分通常反映在我們第四季的財務報表中。

As we think about crop profitability for the current crop year, it's important to remember that most of our crop insurance is revenue protection where both the harvest price of the crops and yields impact claims. Harvest pricing for corn and soybeans, which was determined in October, settled 11% and 13% lower than the spring discovery prices, respectively. The harvest of corn and soybean crops is running ahead of five-year averages. Yield variability will be important to our final results. Noting that the average farmer deductible is a little over 20% and considering harvest pricing, we're optimistic about an above-average crop year.

當我們考慮當前作物年度的作物盈利能力時，重要的是要記住，我們的大多數作物保險都是收入保護，其中作物的收穫價格和產量都會影響索賠。10 月確定的玉米和大豆收穫價格分別比春季發現價格低 11% 和 13%。玉米和大豆作物的收成高於五年平均值。產量變異性對我們的最終結果很重要。注意到農民的平均免賠額略高於 20%，並考慮到收穫定價，我們對高於平均水平的作物年份持樂觀態度。

Within Property and Transportation, overall renewal rates in this group increased 7% on average in the third quarter of 2024, about 1 point lower than the pricing achieved in the group for the second quarter of 2024. I'm particularly pleased with the renewal rates achieved in our commercial auto liability line of business, where rates were up 12% in the third quarter. This is our 13th year of rate increases in this line.

在房地產和交通運輸領域，2024 年第三季該組的整體續約率平均成長了 7%，比 2024 年第二季該組的定價低約 1 個百分點。我對我們的商業汽車責任業務線所取得的續約率感到特別滿意，第三季續約率上升了 12%。這是我們在這領域升息的第 13 年。

The businesses in our Specialty Casualty Group achieved a strong 90.0% calendar year combined ratio overall in the third quarter. Higher underwriting profit in our targeted markets businesses was more than offset by lower year-over-year underwriting profit in our excess and surplus businesses and, to a lesser extent, our workers' comp and executive liability businesses. Underwriting profitability in our workers' compensation and executive liability businesses continues to be excellent.

第三季度，我們特種傷亡集團的業務總體綜合成本率達到了 90.0% 的強勁水平。我們目標市場業務的較高承保利潤被我們的超額和盈餘業務以及較小程度上的工人賠償和行政責任業務同比承保利潤的下降所抵消。我們的工人賠償和高階主管責任業務的承保盈利能力繼續保持出色。

Third quarter 2024 gross and net written premiums increased 6% and 4%, respectively, when compared to the same prior year period. Primary drivers of growth were new business opportunities and favorable renewal pricing in several of our targeted markets businesses and our excess liability business. Our mergers and acquisitions business also benefited from an increase in M&A activity. This growth was tempered by slightly lower workers' compensation premiums. Excluding workers' compensation, third quarter gross and net written premiums in this group both grew 8% year over year. Excluding our workers' compensation businesses, renewal rates for this group were up approximately 10% in the third quarter, and up 8% including workers' comp. Both measures improved about 3 points from the renewal pricing in the previous quarter. And I continue to be pleased that we continue to achieve renewal rate increases of 10% or better during the quarter in several of our social inflation-exposed businesses, including our social services, excess liability, and public entity businesses.

與去年同期相比，2024 年第三季的毛保費和淨保費分別成長了 6% 和 4%。成長的主要驅動力是我們的幾個目標市場業務和超額責任業務的新商機和有利的續約定價。我們的併購業務也受惠於併購活動的增加。這一增長受到工人賠償金略有下降的影響。不包括工人賠償，該組第三季毛保費和淨保費均較去年同期成長 8%。不包括工人補償業務，該類別的續約率在第三季度增長了約 10%，包括工人補償業務則增長了 8%。這兩項指標均比上一季的續約定價提高了約 3 個百分點。我仍然感到高興的是，本季我們的幾個受社會通膨影響的業務（包括社會服務、超額負債和公共實體業務）繼續實現了 10% 或更高的續訂率成長。

The Specialty Financial Group continued to achieve excellent underwriting margins and reported a 91.9% combined ratio for the third quarter of 2024, 4.3 points higher than the prior year period. Cat losses contributed 14.4 points to the third quarter of '24 combined ratio, compared to 9.3 points in the prior year third quarter. Improved results in our lender services business were more than offset by lower profitability in our surety and fidelity businesses. Third quarter 2024 gross and net written premiums were up 7% and 9%, respectively, when compared to the prior year period, due primarily to the growth in our financial institutions business. Renewal pricing in this group was up 6% for the quarter, consistent with the previous quarter.

專業金融集團持續實現優異的承保利潤率，2024 年第三季綜合成本率為 91.9%，比去年同期高出 4.3 個百分點。Cat 虧損為 24 年第三季綜合成本率貢獻了 14.4 個百分點，而去年第三季為 9.3 個百分點。我們的貸款服務業務的業績改善被擔保和保真業務的盈利能力下降所抵消。2024 年第三季的毛保費和淨保費與去年同期相比分別成長了 7% 和 9%，這主要是由於我們的金融機構業務的成長。本季該組的續訂價格上漲了 6%，與上一季一致。

To conclude, we're pleased with the results in the third quarter and year to date. Through the first nine months of 2024, our annualized core operating return on equity is excellent at 18%. The calendar year combined ratio in our Specialty Property and Casualty business is 91.9%, six tenths of a point above where we were last year at this time. In addition, we're selectively growing our Specialty businesses at a healthy rate, pricing is exceeding expectations and investment performance continues to be strong. We're well positioned to continue to build long-term value for our shareholders for the remainder of 2024 and beyond.

總而言之，我們對第三季和今年迄今的結果感到滿意。到 2024 年前 9 個月，我們的年化核心營運股本回報率高達 18%。我們專業財產和意外傷害業務的歷年綜合成本率為 91.9%，比去年同期高出十分之六。此外，我們有選擇地以健康的速度發展我們的特種業務，定價超出預期，投資業績持續強勁。我們已做好充分準備，能夠在 2024 年剩餘時間及以後繼續為股東創造長期價值。

We'll now open the lines for the Q&A portion of today's call, and Craig and Brian and I will be happy respond to your questions. Thank you.

我們現在將開放今天電話的問答部分，克雷格、布萊恩和我將很樂意回答你們的問題。謝謝。

(Operator Instructions) Our first question comes from Michael Zaremski of BMO. Michael, your line is open.

（操作員說明）我們的第一個問題來自 BMO 的 Michael Zaremski。邁克爾，您的線路已開通。

Hey, good morning. First question is kind of a high-level question on the loss ratio. A number of companies or a handful of companies, sorry, have kind of been proactively disclosing that they've been adding to their IBNR, so the incurred but not reported, bucket of reserves over the past year or two in light of just a rising trend line, especially in social inflationary lines. Just curious if you'd be able or willing to kind of give us a flavor of whether AFG has, Great American and American Financial Group, has also been adding to that kind of that bucket as a percentage of historical levels?

嘿，早安。第一個問題是關於損失率的高階問題。抱歉，一些公司或少數公司已經主動披露他們已經增加了 IBNR，因此過去一兩年發生但未報告的準備金桶只是在不斷上升趨勢線，尤其是社會通膨線。只是好奇您是否能夠或願意讓我們了解 AFG、Great American 和美國金融集團是否也以歷史水平的百分比的形式加入了這個類別？

So when you look at our businesses, it's really been business unit by business unit in addition to looking for rate increases in the social inflation-exposed businesses and we’ve been getting them there. We also have changed some terms and conditions. So it can be a little tricky to analyze the IBNR when, for example, in an excess business, maybe the attachment point is different than it was before. So it's not exactly the same product as what you might have seen in previous years. But we look at each business unit, the reserve position of each business unit every quarter and react to new information very quickly, particularly negative news.

因此，當你審視我們的業務時，除了尋求受社會通貨膨脹影響的業務的利率上漲之外，實際上還逐個業務部門，我們一直在實現這些目標。我們也更改了一些條款和條件。因此，分析 IBNR 可能會有點棘手，例如，在業務過剩時，附著點可能與以前不同。因此，它與您前幾年看到的產品並不完全相同。但我們每季都會查看每個業務部門、每個業務部門的儲備倉位，並且對新訊息，特別是負面消息做出反應非常快。

That process can result in favorable or adverse development for any business unit in any quarter. We've just been fortunate to have more favorable development than adverse development in those periods. This particular quarter, we did see some elevated large losses in our umbrella and excess liability businesses and reacted to that and did the best that we can. We would reflect new information into all of our accident year picks, so that can cause us to elevate our picks and book some IBNR. But I think in looking at the IBNR versus case reserves, there's lots of factors going into it that you can't just really give a number.

這一過程可能會導致任何業務部門在任何季度的有利或不利的發展。我們很幸運，在那些時期，有利的發展多於不利的發展。在這個特定的季度，我們確實看到我們的保護傘和超額負債業務出現了一些巨額虧損，我們對此做出了反應，並盡了最大努力。我們會將新資訊反映到所有意外年份的選擇中，以便我們提高選擇並預訂一些 IBNR。但我認為，在考慮 IBNR 與案件準備金時，有很多因素涉及其中，你不能只給出一個數字。

Okay. Got it. Yeah. I appreciate there's a lot of moving parts. Maybe switching gears a bit, Craig, I believe you made prepared remarks saying you think the alternative investment portfolio can eventually get back to 10% plus returns, but you can correct me if I'm wrong.

好的。知道了。是的。我很欣賞有很多活動部件。也許稍微改變一下態度，克雷格，我相信你已經做了準備好的發言，說你認為另類投資組合最終可以恢復到 10% 以上的回報，但如果我錯了，你可以糾正我。

Just curious, is the market normalizing in terms of fundamentals for real estate? And is that kind of a -- you're becoming just incrementally more confident that in the quarters to come, you'll get kind of back to the target returns?

只是好奇，就房地產基本面而言，市場是否正在正常化？您是否越來越有信心在接下來的幾季中恢復到目標回報？

Sure. Let me start out by giving you my view of the more traditional private equity investments. Hard to predict the returns, but certainly a strong stock market should favor marks on the traditional private equity investments.

當然。讓我先向您介紹我對傳統私募股權投資的看法。很難預測回報，但強勁的股市肯定有利於傳統私募股權投資的表現。

Now let me switch to multi-family, I'll give you my view. So multi-family represents a little less than half of our alternative investments. And the operations have held up just fine. We're projecting that for the year, even with the new supply coming into the market, our NOI will be flattish with last year. We did incur some negative marks. Our general partners do marks every quarter on the properties that we've invested in. And because of increased cap rates that are driven by higher interest rates, we did some negative marks that we booked in the first nine months of the year.

現在讓我轉向多戶家庭，我將給你我的看法。因此，多戶住宅僅占我們另類投資的一半不到。而且業務運作得很好。我們預計，今年即使有新供應進入市場，我們的 NOI 也將與去年持平。我們確實受到了一些負面影響。我們的普通合夥人每季都會對我們投資的房產進行標記。由於利率上升導致資本化率上升，我們在今年前九個月記錄了一些負面記錄。

We do benefit from having very attractively priced fixed rate debt on 54 of our 58 properties. I think the average rate on those 54 properties, the loans on 54 properties is around 4% or just over 4%. So we're different than some others in that we do have good protection because of the financing that we have in place.

我們確實受益於我們 58 處房產中 54 處的定價極具吸引力的固定利率債務。我認為這 54 處房產、54 處房產的貸款的平均利率約為 4% 或略高於 4%。因此，我們與其他一些公司的不同之處在於，我們確實擁有良好的保護，因為我們擁有適當的融資。

Let me give you my view of the multi-family business. Multi-family starts now are at a 10- or 11-year low. So we've had a lot of new building in the last couple of years, a lot of new supply coming on stream. I think the peak of that is probably right now, probably the third quarter and fourth quarter is the peak of multi-family completions. Given that new starts are at a 10- or 11-year low, there's going to come a point in time, probably toward the end of next year, where the new supply is going to be absorbed, and we're going to, once again, have very strong pricing power.

讓我向您介紹一下我對多家族企業的看法。目前多戶住宅開工率處於 10 或 11 年來的最低點。因此，過去幾年我們建造了許多新建築，大量新供應即將投入使用。我認為現在可能是峰值，第三和第四季可能是多戶住宅竣工的峰值。鑑於新開工量處於 10 或 11 年來的低點，可能會在明年年底左右出現一個時間點，新供應將被吸收，我們將一次再次，具有很強的定價能力。

So think it probably takes another 9 months, 12 months or so to absorb the new supply that's coming on the market. I do think that toward the end of next year, when there is going to be very little new supply hitting the market, that the pricing power will again be very strong.

因此，我認為可能還需要 9 個月、12 個月左右的時間來吸收市場上的新供應。我確實認為，到明年年底，當市場上的新供應量很少時，定價能力將再次變得非常強大。

One other thing that has changed here recently is clearly, there is significant buying interest in multi-family properties again. That has changed here in the last couple of months. We just signed an agreement to sell one of our properties. It's a property in Colorado, that we agreed to sell at a 4.60% cap rate based upon trailing 12 months NOI, which we found pretty attractive. And we are seeing some transactions now for the first time in a while. So that's kind of my view of multi-family and kind of what we expect in the next year or so.

最近發生的另一件事顯然是，人們再次對多戶住宅產生了濃厚的購買興趣。在過去的幾個月裡，情況發生了變化。我們剛剛簽署了一份出售我們一處房產的協議。這是科羅拉多州的一處房產，我們同意根據過去 12 個月的 NOI 以 4.60% 的上限利率出售，我們發現這非常有吸引力。我們現在第一次看到一些交易。這就是我對多戶家庭的看法，也是我們對明年左右的期望。

That's comprehensive. Thank you. And just lastly, I'm pivoting back to the property and casualty insurance operations and specifically kind of the competitive environment on pricing. So in the Specialty Casualty, it feels like we see that your pricing sequentially kind of accelerated fairly meaningfully. I'm going to assume that's kind of coming from the social inflationary exposed lines. I feel like we've been seeing data points from that from your peers. I don't know if you have any comments on that? On Property and Transportation, I don't know if you might have given us an update. I know your commercial auto rate increases have been running well in excess of, I think, the market in recent quarters. If you can kind of remind us how that's trending. I see that pricing was down a little bit sequentially there, too. But just curious on the pricing environment for the social inflationary exposed lines like commercial auto and some of the Specialty Casualty stuff.

這很全面。謝謝。最後，我將回到財產和傷亡保險業務，特別是定價的競爭環境。因此，在特殊傷亡事故中，我們感覺您的定價連續相當有意義地加速了。我假設這是來自社會通膨暴露線。我覺得我們已經從你們的同行那裡看到了數據點。不知道你對此有何評論？關於房產和交通，我不知道您是否向我們提供了最新情況。我知道你們的商業汽車費率上漲幅度我認為最近幾季的漲幅遠遠超過了市場。如果您能提醒我們這方面的趨勢如何。我發現那裡的價格也連續下降了一點。但只是對商業汽車和一些特殊傷亡險等受社會通貨膨脹影響的產品的定價環境感到好奇。

Yeah. I think I mentioned earlier that I feel good about the continued favorable pricing environment, particularly with the social inflation-exposed lines. Commercial auto liability, we got another 12% price increase in the third quarter. I believe that number is 16% year to date. So a good favorable number. Things can vary quarter by quarter. And then in the businesses like excess liability lines, public sector, our nonprofit businesses that are some of the more social exposed businesses in that 10%-plus strong double-digit increases in those lines is what we continue to have, both in the third quarter, and when you look at year-to-date, it's pretty much the same. So I feel good about that, and the continued favorable pricing environment that we're in.

是的。我想我之前提到過，我對持續有利的定價環境感覺良好，特別是考慮到社會通膨風險。商用汽車責任險，第三季價格又上漲了 12%。我相信今年迄今為止這個數字是 16%。所以這是一個很好的優惠數字。每個季度情況都會有所不同。然後，在超額責任限額、公共部門、我們的非營利企業等企業中，這些企業是一些社會暴露程度較高的企業，這些限額的10% 以上強勁的兩位數增長是我們在第三季度繼續保持的。因此，我對此以及我們所處的持續有利的定價環境感到滿意。

Thank you.

謝謝。

Our next question comes from the line of Andrew Anderson at Jefferies. Andrew, your line is open.

我們的下一個問題來自傑富瑞 (Jefferies) 的安德魯安德森 (Andrew Anderson)。安德魯，您的線路已開通。

Hey, good morning. You had mentioned some adverse development on social inflation lines. Could you please talk about what accident years that was from and maybe size of magnitude?

嘿，早安。您提到了社會通貨膨脹線的一些不利發展。您能談談事故發生的年份以及事故的嚴重程度嗎？

Hi, this is Brian. I think when you look at our casualty businesses, I think the first thing to kind of anchor in on is the results overall, where our Casualty Group has a combined ratio of 90% for the third quarter and 88.4% for the first nine months. With those kinds of combined ratios, that's ROEs in the high 20s or better, so they're really good results overall for our Casualty businesses. But if you just want to focus in on the favorable development there and still on that favorable development, as we noted, we did have continued good favorable development out of workers' comp, but we have that offset by some of the social inflation-exposed businesses. And it is large loss activity over a number of years. So it's not just the older years. It is a little bit in some of the more recent years. We're talking about it because it is reducing our favorable development overall, but the results in general are very good. And we feel confident with what we know now with our reserves, not that things can't happen, but we're really good with ROEs that come from business that's in the '90s in the long run.

嗨，這是布萊恩。我認為，當你審視我們的傷亡業務時，首先要關注的是整體業績，我們的傷亡集團第三季​​的綜合成本率為 90%，前 9 個月的綜合成本率為 88.4%。有了這些綜合比率，ROE 就在 20 左右或更高，因此對於我們的傷亡業務來說，總體而言，它們確實取得了不錯的業績。但是，如果你只想關注那裡的有利發展，並且仍然關注這種有利發展，正如我們所指出的，我們確實在工人補償方面取得了持續良好的有利發展，但我們已經被一些受通貨膨脹影響的社會因素所抵銷了。這是多年來巨大的損失活動。所以這不僅僅是老年時期的事情。最近幾年有一點。我們談論它是因為它總體上減少了我們的有利發展，但總體結果非常好。我們對現在所知道的儲備充滿信心，並不是說事情不可能發生，而是從長遠來看，我們對來自 90 年代業務的 ROE 感到非常滿意。

Thanks. And maybe sticking on just the Casualty segment. The underlying loss ratio had some pretty notable improvement year-over-year. Could you just maybe talk about some of the drivers?

謝謝。也許只專注於傷亡部分。基本損失率同比有一些相當顯著的改善。您能談談一些驅動程式嗎？

Sure. So particularly in like our targeted markets business where we would have things like public sector business or specialty human services business, ones where we have been getting significant rate and ones where in some of the prior periods we had some adverse development, we're seeing improvements in the accident year results there as we have taken action in those books, both pricing wise and terms and conditions wise and appetite-wise, so that we're seeing much improved results out of those targeted markets and consistent results in the workers' comp.

當然。因此，特別是在我們的目標市場業務中，我們將擁有公共部門業務或專業人類服務業務等業務，這些業務我們獲得了顯著的利率，而在之前的一些時期我們有一些不利的發展，我們看到事故年的結果有所改善，因為我們在這些書中採取了行動，包括定價方面、條款和條件方面以及胃口方面，因此我們看到這些目標市場的結果有了很大改善，工人的結果也一致比較。

Thank you.

謝謝。

Our next question comes from Meyer Shields of Keefe, Bruyette, & Woods. Meyer your line is open.

我們的下一個問題來自 Keefe、Bruyette 和 Woods 的 Meyer Shields。邁耶，你的線路已開通。

Great. Thanks so much. So one quick reserve question, if I can. Because Carl, you sounded very optimistic about commercial auto. I'm wondering whether that was a line that faced any social inflation requiring a reserve adjustment?

偉大的。非常感謝。如果可以的話，我想問一個快速保留的問題。因為卡爾，你聽起來對商用車非常樂觀。我想知道這條線是否面臨任何社會通貨膨脹，需要調整準備金？

Are you asking us if any of the adverse development was related to commercial auto liability?

您是否想問我們任何不利的發展是否與商用汽車責任有關？

Yes.

是的。

So we didn't really have that in our transportation segment. What I would say, in some of our program businesses in Casualty, there was a little bit of adverse development in the commercial liability, but it wasn't the big driver of the numbers.

所以我們的運輸部門並沒有真正做到這一點。我想說的是，在我們的一些傷亡專案業務中，商業責任出現了一些不利的發展，但這並不是數字的主要推動因素。

Okay. That's helpful. Second question, and I don't want to suggest an overreaction. But when you talk about -- again, Carl talked about the non-coastal exposure to Hurricane Helene, how do you think about sort of reassessing non-coastal exposure to catastrophes after an issue like this?

好的。這很有幫助。第二個問題，我不想暗示反應過度。但是，當您再次談到卡爾在颶風海倫中遭受的非沿海地區的影響時，您如何看待在發生這樣的問題後重新評估非沿海地區遭受災難的影響？

Meyer, it's always interesting during my career, each catastrophe event always has things that you learn from it. Even going back to Hugo when things were – again, there was more loss inland than what you think. And even in some of the California earthquakes where there weren't supposed to be fault lines like in Northridge, I believe when I think back. So I think you always try to learn from every event and tighten up where you can. And the kinds of things that we can do is change the price that we're charging, like in our lender-placed property or property inland marine, you can always limit flood exposure more if you want to. So there's lots of levers that you can pull to kind of customize your approach within the property side. So believe me, every time we have an event, we learn and we look at the numbers, and we try to make sense changes in our approach.

邁耶，在我的職業生涯中，這總是很有趣，每次災難事件總會有你從中學到的東西。即使回到雨果，當事情再次發生時，內陸地區的損失比你想像的要多。甚至在加州的一些地震中，當我回想起來時，我相信這些地震中不應該有像北嶺那樣的斷層線。所以我認為你總是試圖從每一次事件中學習並盡可能地加強。我們可以做的事情就是改變我們收取的價格，例如在我們貸款人放置的房產或內陸海洋房產中，如果你願意，你總是可以更多地限制洪水風險。因此，您可以使用很多槓桿來客製化您在房地產方面的方法。所以相信我，每次我們舉辦活動時，我們都會學習並查看數字，並嘗試對我們的方法做出有意義的改變。

Okay. Perfect. And if I can throw one quick question in for Craig. It looks like the market today is anticipating higher for longer interest rates. And I was wondering how should we think about the response in terms of asset allocation or portfolio duration throughout the investment portfolio?

好的。完美的。我能否向克雷格提出一個簡短的問題。看來今天的市場對長期利率的預期更高。我想知道我們應該如何考慮整個投資組合中資產配置或投資組合久期的反應？

Meyer, as you know, we have intentionally kept the duration of the portfolio fairly short. We just didn't see lots of value, or we didn't think it was the right time to be buying a lot of long-duration securities. I think we're going to be certainly a beneficiary of a higher interest rate environment. On the conference call, I talked about a 5.5% reinvestment rate with rates moving up the way they have today. I'd say it could be something over 5.5%, which compares to the 5% yield that we reported in the last quarter.

邁耶，如你所知，我們有意將投資組合的期限保持得相當短。我們只是沒有看到很多價值，或者我們認為現在不是購買大量長期證券的合適時機。我認為我們肯定會成為高利率環境的受益者。在電話會議上，我談到了 5.5% 的再投資利率，利率會像今天一樣上漲。我想說，與我們上個季度報告的 5% 的收益率相比，它可能會超過 5.5%。

So I think we're positioned very well for a higher interest rate environment. I think today, we would think that yields are not, certainly short-term rates are coming down, but longer-term rates are not. We're very pleased with our positioning of short-duration portfolio. And if rates do move much from here, we're in a position to benefit from that.

所以我認為我們已經為更高的利率環境做好了準備。我認為今天，我們會認為短期利率肯定不會下降，但長期利率不會下降。我們對短期投資組合的定位非常滿意。如果利率確實比現在大幅波動，我們就能從中受益。

Okay. Perfect. Thank you very much.

好的。完美的。非常感謝。

Our next question comes again from Andrew Anderson of Jefferies. Andrew, your line is open.

我們的下一個問題再次來自傑富瑞的安德魯安德森。安德魯，您的線路已開通。

Hey, thank you. Just thinking about higher cats this year and then the comment about above-average crop profitability. If we go back to the beginning of the year, you kind of had some underlying business plan assumptions, including $11 of EPS and a similar combined ratio relative to 90.3% in 2023. Do you still expect to achieve both of those metrics?

嘿，謝謝你。只是想想今年更高的貓，然後是關於高於平均水平的作物盈利能力的評論。如果我們回到今年年初，你會看到一些基本的業務計劃假設，包括 11 美元的每股收益和相對於 2023 年 90.3% 的類似綜合成本率。您仍然希望實現這兩個指標嗎？

Well, we're not changing our perspective on our business plan right now. I think you still can have more catastrophes in the fourth quarter. Our Milton projected losses seem to be reasonable and kind of within our model at this point. And then it kind of gets down to really through year-end, just how good of a crop year we end up having in that. And now, it's a matter of seeing what actual claims, the numbers of claims, kind of the average claims, and that kind of thing through in that business through year-end and into January. I think we'll have a much better feel of our overall crop profitability and just how good it is the next time we report for sure.

好吧，我們現在不會改變對業務計劃的看法。我認為第四季仍然可能會發生更多災難。目前，我們的米爾頓預計損失似乎是合理的，並且在我們的模型之內。然後就到了年底，我們最終的收成有多好。現在，問題是要看看該業務從年底到一月份的實際索賠情況、索賠數量、平均索賠情況以及此類情況。我認為我們下次報告時會對我們的整體作物盈利能力以及它有多好有更好的感受。

Thank you.

謝謝。

Thank you very much. At this time, I'm showing no further questions. I would now like to turn the call back to Diane Weidner, Vice President, Investor Relations, for closing remarks.

非常感謝。目前，我沒有再提出任何問題。現在，我想將電話轉回給投資者關係副總裁黛安·韋德納 (Diane Weidner)，讓其致閉幕詞。

Thank you, and I appreciate all the good questions today, and thanks for your time joining us this morning as we recap our third quarter results. We look forward to talking with all of you again next quarter, and hope you have a great rest of your day.

謝謝您，我感謝今天提出的所有好問題，並感謝您今天早上抽出時間與我們一起回顧我們的第三季業績。我們期待下個季度再次與大家交談，並希望您度過愉快的一天。

Thank you for your participation in today's conference. This does conclude the program, and you may now disconnect.

感謝您參加今天的會議。這確實結束了程序，您現在可以斷開連接。