Assurant, Inc.

Welcome to Assurance First Quarter 2023 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 the management's prepared remarks. If you would like to ask a question at that time, please press star one on your touch tone phone. If at any point your question has been answered, you may remove yourself from the queue by pressing star one again. 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 now begin.

Thank you, operator, and good morning, everyone. We look forward to discussing our first quarter 2023 results with you today. Joining me for assurance conference call are Keith Demings, our President and Chief Executive Officer, and Richard Jajo, our Chief Financial Officer. Yesterday, after the market closed, we issued a news release announcing our results for the first quarter of 2023. The release and corresponding financial supplement are available on Assurant.com. We'll 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, uncertainties, and other factors that may cause actual results to differ materially from those contemplated by these statements. Additional information regarding these factors can be found in yesterday's earnings release and financial supplement, as well as in our SEC report. During today's call, we referred 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 news release and financial supplement. I will now turn the call over to Keith.

Thanks, Suzanne, and good morning, everyone. We're pleased by our first quarter results, which reflected better-than-expected performance within our global housing business and our ongoing focus on driving operating excellence across Assurance. The actions we announced in 2022 to simplify our business and real estate portfolio, realign our organizational structure, and accelerate the deployment of digital-first experiences are beginning to yield measurable results. While early, gross savings generated from these initiatives are helping to mitigate the impact of broader macroeconomic headwinds and fund additional critical investments in innovation and our talent. This was reflected in Global Lifestyle's results for the quarter which improved sequentially in line with our expectations. Our first quarter results also continue to demonstrate the leadership advantages of our well-diversified business portfolio and our global client base. We believe we are well positioned to deliver on our financial objectives for 2023, and we will continue to prudently manage our capital to drive shareholder value. Looking ahead, we'll maintain a steadfast focus on execution, First, by strengthening and expanding our global partnerships. Second, by driving innovation and delivering on our digital first vision to improve the customer experience. And third, by realizing savings from ongoing expense management efforts. Recently, we were recognized as one of America's most innovative companies by Fortune, demonstrating the importance we place on finding new ways to serve our clients and fostering a culture of innovation and inclusion. Through consumer research and investments in emerging technologies, we develop new products and services to meaningfully enhance the consumer experience and drive competitive advantages across our key markets, including mobile, auto, and housing. We continue to strengthen our large embedded base of businesses. In Global Lifestyle, we work with 15 of the top 50 most valuable global brands. and provide protection and services for nearly 62 million mobile subscribers with a recurring monthly subscription service. And we protect nearly 54 million automobiles across a wide range of distribution partners. Our scale supports both businesses to continue their track record of long-term growth. Our U.S. connected living business is expected to remain a solid growth driver, anchored by mobile device protection with marquee mobile carriers and cable operators. In addition, our trade-in business continues to be a strong contributor to overall mobile results. Our international results have begun to stabilize in line with our expectations, even as many of the factors impacting growth last year continue to persist, including foreign exchange headwinds and lower business volumes. In Europe, we benefited from expense actions previously taken, leading to improved earnings when compared to the second half of 2022. Additionally, we renewed eight key clients since the beginning of 2022, solidifying a strong foundation to support continued growth. In Japan, we're implementing actions to stabilize the impact from ongoing mobile subscriber declines and believe we are well positioned in this critical market, even as programs mature. In addition to our multi-year partnership with K2DI, we're growing our footprint through expanded relationships with other large Japanese carriers. we're leveraging our core mobile solutions and technology offerings to help optimize operations and launch new services. Moving to Global Auto, we're making steady progress integrating and leveraging recent acquisitions to support commercial success with new partnerships like CNH Industrial, which leverages the combined expertise of our legacy-assurance lease and finance business and the broad capabilities of our EPG acquisition. Outside of the U.S., we focused on expanding our share with OEMs, and in Latin America and Europe, we signed two new business partnerships in the quarter. Overall, in lifestyle, while we remain cautious in the short term given ongoing global macroeconomic uncertainty, we continue to expect modest growth for the full year. Within global housing, we've continued to simplify our focus on product lines where we have clear competitive advantages in scale. we operate a counter-cyclical market-leading lender-placed business that has generated significant cash flow and attractive returns over the long term, while we invest to drive growth in our capital-light renter's insurance business. Despite higher-than-expected cat activity this quarter, global housing had a strong start to the year as adjusted EBITDA, excluding cats, increased 7%. In homeowners, which is primarily driven by lender-placed, Topline grew 16%, both from higher policy growth and higher average insured values and rates, partially offset by increased non-CAT losses and CAT reinsurance costs. Policy growth came from both new and existing clients. In lender-placed, our ability to drive higher premiums both through our inflation guard product feature and rate actions have helped to offset continued inflation impacts on claims, which remain elevated across global housing. Entering the second quarter, the impact of inflation on building materials and labor costs is beginning to show signs of improvement. As we consider the magnitude and pace of earnings recovery for global housing over the year, it will be important to see how ongoing loss experience improves over the next few quarters. Let's turn to our enterprise outlook in capital. Reflecting on the quarter and current market conditions, we continue to expect to grow adjusted EBITDA, excluding reportable CATs, by low single digits this year. Adjusted EPS growth is still expected to trail adjusted EBITDA growth, both excluding reportable CATs, primarily reflecting higher annual depreciation expenses related to several strategic technology investments critical to executing our strategy, a higher consolidated effective tax rate compared to favorable rates in 2022, and the timing of capital deployment. From a capital perspective, we upstreamed $112 million of segment dividends in the first quarter and ended the quarter with $383 million of holding company liquidity. We've been carefully monitoring the broader business and macroeconomic environment as we consider capital deployment. We now expect to resume share repurchases later in the second quarter, but at modest levels given the ongoing market volatility. We expect the majority of share repurchases to be weighted toward the end of the year and maybe below 2022 underlying buyback activity. As we look ahead, we're focused on the continued execution of our vision to be the leading global business services provider supporting the advancement of the connected world. We believe our strong global client partnerships and our ability to innovate for more than 300 million customers will be critical to achieving our vision. I'll now turn the call over to Richard to review the first quarter results and our 2023 outlook in greater detail. Richard?