Assurant, Inc.

Welcome to Assurance First Quarter 2022 Conference Call and Webcast. At this time, all participants have been placed in a listen-only mode, and the floor will be open for your questions following management's prepared remarks. If you would like to ask a question at that time, please press star 1 on your touchtone phone. If at any point your question has been answered, you may remove yourself from the queue by again pressing star 1. We ask that you please pick up your handset to allow optimal sound quality. Lastly, If you should require operator assistance, please press star zero. It is now my pleasure to turn the floor over to Suzanne Shepherd, Senior Vice President of Investor Relations and Sustainability. You may begin.

Thank you, Operator, and good morning, everyone. We look forward to discussing our first quarter 2022 results with you today. Joining me for Assurance Conference Call are Keith Demmes, our President and Chief Executive Officers and Richard Zazio, our Chief Financial Officer. Yesterday, after the market closed, we issued a news release announcing our results for the first quarter of 2022. The release and corresponding financial supplement are available on Assurant.com. We will start today's call with remarks from Keith and Richard before moving into a Q&A session. Some of the statements made today are forward-looking. Forward-looking statements are based upon our historical performance, and current expectations, and subject to risks, uncertainty, and other factors that may cause actual results to differ materially from those contemplated value statements. Additional information regarding these factors can be found in yesterday's earnings release, as well as in our SEC report. During today's call, we will refer to non-GAAP financial measures, which we believe are important in evaluating the company's performance. For more details on these measures, the most comparable gap measures, and the reconciliation of the two, please refer to yesterday's newsreels and financial supplement, as well as the yesterday presentation materials that can be found on our website. I will now turn the call over to Keith.

Thanks, Suzanne, and good morning, everyone. We're pleased with our performance for the first quarter, which demonstrates the resiliency and strength of our business during a period of macroeconomic and geopolitical uncertainty. Within Global Lifestyle, stronger than expected performance in our capital light connected living and global automotive businesses offset softer than expected results within global housing, mainly from our specialty offerings. The ongoing growth of our fee-based capital light offerings across global lifestyle and global housing accounted for nearly 80% of segment earnings in 2021. This differentiates Assurant as both a service-oriented partner to our clients and a compelling investment given our scaled customer base in markets with strong tailwinds. Our continued alignment with world-class partners and our ability to provide best-in-class products, services, and customer experiences has positioned us well for expected profitable growth this year and over the long term. As we outlined at Investor Day in March, we have a clear vision for the future to be the leading global business services company supporting the advancement of the connected world. We aren't settling for the status quo. While we currently have scale leadership positions in attractive and growing markets, we have our sights set on being the leader in all of the businesses in which we operate. With that said, we believe the financial objectives we outline for Assurant over the next three years are attractive and will be supported by our focus on market leading innovation, business simplification, operational optimization, and the benefits of scale. We believe this will lead to continued strong cash flow generation, earnings growth, and financial outperformance. In global lifestyle, we remain focused on supporting our more than 250 million customers through our broad set of products and services across insurance, operations, mobile trade and repair, and comprehensive administrative services throughout connected living and global automotive. For this segment, we continue to expect adjusted EBITDA growth in the low double digits for 2022, with average annual growth of 10% in 2023 and 2024. We anticipate Connected Living will lead our growth for the lifestyle segment, driven by our multidimensional strategy. Over the next three years, Connected Living should benefit from increased mobile and retail client expansion, an increase in fee-based trade and repair, as well as contributions from strategic M&A. We continue to be excited about opportunities to drive growth in our retail business as we think about longer-term opportunities to serve the connected home. As of May 1st, we're pleased to announce that we have expanded our relationship with one of our largest U.S. retail partners. We moved beyond program underwriting and have expanded our services to provide for the end-to-end administration of the business, including call center support, claims management, and oversight of service delivery. Not only does this allow us to deepen our relationship with a critical client, it allows us to continue to grow our retail business while dramatically increasing our scale to support claims and customer service, further improving our relevance with the third-party repair network that supports this business. We now support a meaningfully larger number of appliance repairs, which we believe is strategically important to our ambitions to provide protection services to the evolving connected home. This partnership will also support additional investments in digital tools and technology platforms that are key to our long-term vision. Global Automotive is expected to benefit from our increased scale and strong national dealer, third-party administrator, and international OEM partnerships. We will continue to invest in technology, integrating our systems and processes following several years of successful acquisitions. Throughout lifestyle, we'll also continue to invest to expand our market-leading positions. We anticipate incremental spending related to the development of new products, such as our connected home offerings, and increased investments for new client implementations. In global housing, the business is expected to grow mid to high single digits in 2023 and 2024. For 2022, we now expect mid-single-digit growth given the sharing economy performance in the first quarter. Growth in housing is expected to be led by our lender place business, an important provider of property protection in the U.S. housing market. This will be driven by efficiencies across our operating model that will position us to benefit from the modest increase to placement rates and REO volume recovery that we expect later this year. Together, these trends will create scale benefits with our large portfolio of over 30 million loans, which will drive lower expenses across the business. Multifamily housing remains an attractive long-term growth story, although 2022 will be pressured as we continue to make investments in our customer experience and technology. These investments should ultimately support growth of our 2.6 million renters policies and further penetrate the approximately 20 million U.S. renters market. Lastly, our specialty offerings are still expected to grow over the long term, despite recent elevated losses in sharing economy from policies previously written under less favorable contract terms, including those from runoff clients. As we consider potential impacts from macro factors like inflation or supply chain disruptions throughout lifestyle and housing, we've not experienced a material impact to Assurant overall. In our mobile business, where the availability of parts fluctuates, we're working proactively with large suppliers to keep higher levels of inventory on hand to ensure timely and cost-effective repairs for customers. We'll continue to monitor developments and any corresponding impact on our business as is necessary. Our ability to meet our business goals is supported by the successful execution of our ESG efforts. We recently published our 2022 sustainability report, highlighting our commitment to build a more sustainable future for all stakeholders through our ESG initiative. We are continuing to advance our efforts, specifically within our strategic focus areas of talent, products, and climate. Our sustainability report showcases recent actions and recognitions. while also providing insight into the impact of assurance sustainability efforts utilizing key ESG reporting frameworks such as SASB and TCFD. In addition to setting long-term targets for lifestyle and housing at our investor day, we also provided three key enterprise financial objectives, adjusted EBITDA, adjusted earnings per share, and cash generation. For this year, we continue to expect to grow adjusted earnings per share excluding catastrophe losses by 16 to 20% from the $12.12 we reported in 2021. This will be driven by 8 to 10% adjusted EBITDA growth from the $1.1 billion in 2021, as well as disciplined capital deployment through share repurchases, including using the remaining net proceeds from last year's sale of global pre-need. For 2023 and 2024, we expect to grow average adjusted earnings per share by 12% or more with double-digit average adjusted EBITDA expansion, both excluding reportable catastrophes. Through the first quarter, we returned approximately 85% of the $900 million of pre-need proceeds, and we expect to return the balance by the end of the second quarter. At the end of March, holding company liquidity totaled $738 million after returning $280 million in share repurchases and common stock dividends. Over the next three years, as the business continues to grow, we expect to generate approximately $2.9 billion of cash from our business segments, providing us with around $2.2 billion of deployable capital. We'll continue to be disciplined about capital deployment with the objective of maximizing long-term returns, taking a balanced approach between investments and growth, and returning capital to shareholders. Our goal is to maintain greater capital flexibility as we see attractive opportunities for growth. We might hold higher levels of cash depending on the opportunities we have in front of us, but we won't accumulate cash without line of sight to value creating opportunities. We'll continue to return excess capital through share buybacks. Overall, we're pleased with our performance in the first quarter. We're confident in our ability to continue to expand earnings and cash flows. This will also allow us to continue to invest in our businesses and sustain our track record of returning excess capital to shareholders over the long term. I'll now turn the call over to Richard to review the first quarter results and our 2022 outlook.