Conifer Holdings, Inc.

Hello and welcome to the Conifer Holdings fourth quarter 2022 investor conference call. All participants will be on the Sonali mode. Should you need assistance, please signal a conference specialist for pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. Please note, today's event is being recorded. I will now turn the conference over to Brian Roney. Please go ahead.

Thank you and good morning, everyone. Conifer issued its 2022 fourth quarter financial results after the close of market yesterday. You can find copies of the earnings release on the company's website, ir.cnfrh.com. The slide presentation accompanying management's discussion this morning is available to view or download via webcast or from the investor relations portion of Conifer's website. Before we get started, Please note that except with regard to historical information, statements made in this conference call may constitute forward-looking statements within the meaning of the federal securities laws, including statements relating to trends, the company's operations and financial results, and the business and the products of the company and its subsidiaries. Actual results may differ materially from the results anticipated in these forward-looking statements. due to various risks and uncertainties underlying our forward-looking statements, including risks and uncertainties associated with COVID-19 and its impact on the economy and on our business, as well as those risks described from time to time in Conifer's filings with the SEC, including our latest Form 10-K and subsequent reports. Conifer specifically disclaims any obligation to update or revise any forward-looking statements whether as a result of new information, future developments, or otherwise. In addition, a replay of this call will be provided through a link on the investor relations section of our website. During this call, we'll also discuss non-GAAP financial measures as defined by SEC Regulation G. Reconciliations of these non-GAAP financial measures to the comparable GAAP financial measures are included when possible in our earnings release and our historical SEC filings. Statutory accounting data is prepared in accordance with statutory accounting rules and is therefore not reconciled to GAAP. We will conduct a Q&A session after management's prepared remarks this morning. With that, I'll turn the call over to Jim Peckhoff, Executive Chairman and Co-Chief Executive Officer. Jim?

Thanks, Brian. Good morning, everyone. Joining me on the call today are Nick and Harold. As we look in review of the full year of 2022. Our focus remained dedicated to achieving sustainable, top line, streamlined expect structure and operating profit for Conifer. In that light, I'm pleased to report another year of top line growth in 2022. Over the past several years, we have continued to make significant strides in organically growing our business. While our top line has continued to grow and was up roughly 5% for 2022, More importantly, that growth came as we continued to write what we know best by staying in our underwriting lane and expanding further into our key underwriting verticals. Nick will discuss that more later. For years, we've heard us talk about the positive underwriting steps that we've been taking to not only grow our book, but to grow it profitably over time. In addition to the significant underwriting enhancements over the past several years, including tightened terms and conditions, lower reinsurance retentions, improved geographic spread, and increased rate across the book. We have continued to strengthen our general case reserves and ratchet up our ultimates as well. All in efforts to strengthen the book, improve our overall reserve position, and lead to an operating profit. Conjunction with top line growth and underwriting enhancements, we have executed on numerous initiatives to drive down our expense ratio. As a result, we pulled posted a 38% expense ratio for the full year, our best for yearly performance to date. We expect to continue those successful expense savings initiatives as we go forward. Keep in mind our expense ratio goal remains 35% or lower. For the fourth quarter we posted a 37% expense ratio, so we are definitely making headway. Overall, with the top line trending positively and the expense ratio coming down, Our largest impediment to consistent operating profit has been the lingering effect of legacy reserve drag. To specifically address that issue, early in the fourth quarter we announced two strategic transactions that we believe will position us for stronger near-term results with improved and sustained profitability going forward. We executed a lost portfolio transfer or LPT agreement which provides an additional $20 million of adverse loss development cover for the accident years 219 and prior. This transaction should provide ample support for our reserve position going forward. To pay the costs associated with the LPT and to allow us to further strengthen our overall reserves in Q4, we completed an asset purchase agreement to monetize certain assets of our MGA, Venture Holdings Agency. That completed MGA sale more than paid for the upfront cost of the executed LPT agreement, allowing us to further bolster our reserves and strengthen our year-end reserve position overall. We are pleased to see organic top line growth coupled with the considerable underwriting enhancements we have made over the past several years, narrowing our focus on our select lines of business that have consistently outperformed. We are encouraged by the reserve strengthening that we took throughout the year. plus the execution of the LPT to further protect against legacy reserve drag for action years 2019 and prior. Given all these factors combined, we are pleased to post net income of more than 2 million or 17 cents per share in the quarter. With each day that passes, we feel more confident that we are now clearly on a path toward delivering consistent profitability to our shareholders. Nick will give more color on our underwriting results. Nick?