Donegal Group, Inc.

Good morning and thank you for joining us today. This morning, Donegal Group issued its first quarter 2026 earnings release outlining its results. The release and a supplemental investor presentation are available in the investor relations section of Donegal's website at www.donegalgroup.com. Please be advised that today's conference was pre-recorded and all participants are in listen-only mode. Speaking today will be President and Chief Executive Officer Kevin Burke, Chief Financial Officer Jeff Miller, Chief Underwriting Officer Jeff Hay, Chief Operating Officer Dan Delameter, and Chief Investment Officer Tony Biazzi. Please be aware that statements made during this call that are not historical facts are forward-looking statements and necessarily involve risks and uncertainties that could cause actual results to vary materially. These factors can be found in Donico Group's filings with the Securities and Exchange Commission, including its annual report on Form 10-K and quarterly reports on Form 10-Q. The company disclaims any obligation to update or publicly announce the results of any revisions that they may make to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. With that, it is my pleasure to turn it over to Mr. Kevin Burke. Kevin?

Thank you and welcome everyone. We are pleased to provide an update today on our quarterly results in areas of focus for 2026. Our underwriting results for the first quarter of 2026 lag the unusually favorable results for the first quarter of 2025, largely due to higher-than-average weather-related losses and the impact of several large fire and casualty losses during the quarter. In spite of the unusual loss activity, we are pleased that our core loss ratios reflected solid underlying performance within both the commercial and personal line segments. We are navigating through a softening insurance market conditions, maintaining underwriting and pricing discipline, while also pursuing new business at adequate pricing levels. We have developed specific action plans and assigned clear ownership and accountabilities as we strive to generate new business and retain quality accounts. We have tools in place to monitor progress at a very granular level while executing a renewed engagement strategy with our independent agents to strengthen alignment and solicit increased opportunities for us to gain market share within our clearly defined geographic and class of business appetite. We mentioned in our last call that the successful modernization of our policy systems has provided a solid foundation for the next phase in our technology transformation, which is the migration of our on-premises Guidewire claims, billing, and policy administration systems to the Guidewire Cloud Platform. Moving these core systems to the cloud platform will increase our agility and speed to market and provide enhanced tools and capabilities to empower our business users and enable future growth. We began the first phase of the migration program in February, in which our claims and billing applications will move to the cloud platform in early 2027. We are excited about the opportunity and ability to co-develop and launch new GenAI solutions to production as part of our claim system's cloud migration. Leveraging the significant investments Guidewire and other strategic partners are making to deliver GenAI tools that will be integrated within our core business systems to drive enhanced insights and operational efficiencies. We expect to further leverage the successful outcomes we achieved in this first phase to expedite the implementation of GenAI solutions that will further enhance our underwriting, pricing, and risk selection capabilities when we move into the next phase of the program in 2027. At this point, I'll turn the call over to Jeff Miller for a review of our financial results for the quarter.

Thanks, Kevin. Starting with premium revenues for the first quarter of 2026, net premiums earned decreased 4.9% to $221.4 million. Net premiums written decreased by 3.2%, with lower premium rate increases and retention levels offset partially by an increase in new business volume. A 13.1% decrease in personal lines net premiums written was offset partially by 2.2% growth in commercial lines. Rate increases achieved during the first quarter of 2026 averaged 5.6% in total and 6.4% when excluding workers' compensation. The combined ratio was 99.8% for the first quarter of 2026, compared to 91.6% for the prior year quarter, reflecting higher impacts from weather and large fires and lesser benefit of net favorable development of reserves for losses incurred in prior accident years. Excluding the effect of those specific loss ratio components, the core loss ratio improved to 53.4% compared to 54.2% for the prior year quarter, reflecting a continuation of solid underlying underwriting performance. Compared to the prior year quarter, we achieved a 0.7 percentage point decrease in the commercial lines core loss ratio and a 2.2 percentage point decrease in the personal lines core loss ratio. A continuation of excellent personal line segment performance with an 85.7% statutory combined ratio was largely offset by an underwriting loss in our commercial line segment that resulted in a statutory combined ratio of 104.6% for that segment. Drilling down into the loss ratio components, weather-related losses of $17.2 million, or 7.8 percentage points of the loss ratio for the first quarter of 2026, were double the $8.6 million, or 3.7 percentage points for the first quarter of 2025. Extremely low temperatures for extended periods during the quarter throughout the majority of our operating regions resulted in water damage losses from frozen plumbing lines and severe windstorm activity also contributed to the elevated claim volume. Commercial property losses from severe weather totaled $7.6 million and contributed 13.9 percentage points to the quarterly commercial multi-parallel loss ratio, compared to 5.4 percentage points of the loss ratio for that line of business in the first quarter of 2025. The weather impact to the homeowners line was $8 million, or 25.6 percentage points of the homeowners loss ratio, which was also substantially higher than the 13.7 percentage points in the prior year quarter. In total, the quarterly weather claim impact was well above the previous five-year average for the first quarter of 4.5 percentage points. Despite the elevated weather losses, our insurance subsidiaries did not incur losses from any single event during the first quarter of 2026 or 2025 that exceeded their individual $3 million catastrophe reinsurance retention with Donegal Mutual. Large fire losses, which we define as over $50,000 in damages, contributed 5.5 percentage points to the loss ratio for the first quarter of 2026, which was higher than the 3.3 percentage points for the prior year quarter and reflected increases in both commercial and homeowners' fire losses. Our insurance subsidiaries experienced $5.7 million of net favorable development of reserves for losses incurred in prior accident years, representing a 2.6 percentage point reduction in the loss ratio for the first quarter of 2026, compared to $10.5 million, or a 4.5 percentage point reduction in the loss ratio for the prior year quarter. Specific line of business detail for the first quarter of 2026 included favorable development of $3.5 million for commercial auto, $3.4 million for personal auto, $800,000 for homeowners, $600,000 for workers' compensation, and $500,000 for other personal lines. offset partially by unfavorable development of $1.7 million for commercial multi-parallel and $1.4 million for other commercial lines, which was primarily umbrella liability. The expense ratio of 35.4% for the first quarter of 2026 increased modestly compared to 34.6% for the prior year quarter. The increase primarily reflected the impact of lower net premiums earned for the current quarter. In summary, the modest underwriting income for the first quarter of 2026 combined with $14.3 million of net investment income resulted in after-tax net income of $11.5 million compared to $25.2 million for the first quarter of 2025. To provide more details about our commercial and personal alliance segment results and related initiatives, I will turn the call over to Jeff Hay.