Assurant, Inc.

Welcome to Assurance Third Quarter 2025 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. We ask that you please hold all questions until the completion of the formal remarks, at which time you will be given instructions for the question and answer session. It is now my pleasure to turn the floor over to Sean Mosier, Vice President of Investor Relations. You may begin.

Thank you, Operator, and good morning, everyone. We look forward to discussing our third quarter results with you today. Joining me for Assurance conference call are Keith Demings, our President and Chief Executive Officer, and Keith Meyer, our Chief Financial Officer. Yesterday, after the market closed, we issued an earnings release announcing our results for the third quarter 2025. The release and corresponding financial supplement are available on Assurance.com. Also on our website is a slide presentation for our webcast participants. 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 the earnings release, presentation, and financial supplement on our website, as well as in our SEC reports. During today's call, we will refer to non-GAAP financial measures, which we believe are important in analyzing the company's performance. For more details on these measures, the most comparable GAAP measures, and a reconciliation of the two, please refer to the earnings release presentation and financial supplement on our website. We'll start today's call with remarks before moving into Q&A. I will now turn the call over to Keith Demings.

Good morning, everyone, and thank you for joining us. 2025 continues to be a remarkable year for Assurance. We delivered a very strong third quarter with double-digit earnings growth across both global housing and global lifestyle. Our performance during the quarter and year to date continues to drive significant cash generation and support our balanced capital allocation. Through our powerful B2B2C business model and diversified lifestyle and housing portfolio, we continue to execute for our partners, policyholders, and shareholders. Our unwavering commitment to operational excellence continues to deliver exceptional client outcomes, customer experiences, and differentiated returns. Through the first nine months of the year, we've achieved 13% adjusted EBITDA growth and 15% adjusted EPS growth, both excluding reportable catastrophes. Given the strength of our business performance, we're increasing our 2025 outlook. We now expect full-year adjusted earnings per share growth of low double digits. and adjusted EBITDA growth approaching 10%, excluding CATs, a significant increase from our initial expectations for both metrics. This upward revision further differentiates Assurant in the broader P&C industry as a provider of innovative services within specialized protection and insurance products. Our performance is a testament to our talented employees and their commitment to our clients and policyholders. Their dedication is the foundation of our success, and it's one of the reasons why we've been recognized by Time as one of the world's best companies for the third year in a row. Let's turn to global lifestyle performance and highlights. Lifestyle earnings have continued to accelerate throughout 2025 and have increased 4% or 6% on a constant currency basis year to date, supported by double-digit growth in the third quarter. we remain well positioned to deliver full-year growth across both Connected Living and Global Automotive. In Connected Living, performance has been the result of executing on our long-term strategy to drive commercial momentum through new client programs and the continued expansion of our partnerships combined with enhanced capabilities and services. This quarter, We're excited to announce two new connected living opportunities that were made possible by important investments, which have enabled us to expand our end-to-end solutions and reinforce our competitive advantage. First, in mobile, we're significantly expanding our repair and logistics capabilities through a new multi-year agreement with a large U.S. mobile carrier. We have co-created and are now operating a new, fully dedicated, state-of-the-art logistics facility where we receive return devices from across their entire ecosystem, including mobile phones, tablets, home internet, and accessories. This one facility solution will process and repurpose all returns from store locations, customers, and manufacturers under one roof. Our joint vision was to create a facility that maximizes circularity in the mobile industry, allowing us to reuse, repair, and remanufacture, and deliver these devices back to end customers within the client's network. This allows us to help them optimize their device protection program while improving the end customer experience. This leverages our capabilities, including device processing, upgrading, repair, and rapid claims fulfillment while providing a broad supply of high-quality refurbished devices for insurance replacement, wholesale, and direct-to-consumer channels. This collaboration demonstrates Assurance's role as a strategic partner and solidifies our position as a leader in the reverse logistics space. Successfully executing programs like this demands seamless integration of our operational technology and supply chain management with our clients. We leverage advanced automation AI, and robotics on the processing side to maximize efficiency and ensure consistent, scalable outcomes. We're encouraged by the traction we've made in mobile repair and reverse logistics and continue to be excited about additional near-term opportunities. Our second new opportunity within Connected Living is in our retail extended service contracts business, where we recently launched a partnership to provide administration and underwriting with Best Buy. the world's largest specialty consumer electronics retailer. Through this partnership, Best Buy's Geek Squad protection customers will begin to have access to additional services by assurance, receiving support through our AI-enabled virtual agents, live chat, and access to repairs through our nationwide service network, including our cell phone repair or CPR stores. This partnership represents another win in a space where we've increased our footprint and gained significant momentum over the last several years, now working with U.S. retail leaders across appliances and consumer electronics. Looking to 2026 and beyond, we see clear opportunities within connected living that will further strengthen Assurant. In global auto, adjusted EBITDA increased 4% year-to-date, and we remain on track to grow for the full year, supported by stable run rate earnings and ongoing loss experience improvements. We also continue to optimize performance across the business, with a sharp focus on our clients, systems, product design, claims cost, and people. We have momentum in Global Auto, which is driven by renewed partnerships across distribution channels, including international OEMs and U.S. dealership groups, further solidifying our client base and reinforcing our position as a market leader. A great example is our expanded partnership with Holman Automotive, one of the largest privately owned dealership groups in the United States. Following Holman's 2024 acquisition of Leith Automotive Group, Assurant will support 30 newly added dealership locations with finance and insurance products, dealership sales, and participation program guidance. Our dealer services are also driving new business wins. Our platform is built to support dealers at scale with everything from product innovation to operational support, attracting new partners while creating opportunities with existing ones. Across lifestyle, our ability to deliver solid results while investing in innovation is a key differentiator. Turning to global housing, we continue to outperform with outstanding lender place results in our homeowner's business, as well as continued property management company, or PMC, expansion within renters. We expect another year of strong housing-adjusted EBITDA growth excluding cats, further building on the impressive growth demonstrated since 2022. We continue to expect a very strong combined ratio for the full year, trending below our initial expectations of the mid-80s. This excludes prior year development and reflects lower than expected cats for the year. In homeowners, we're seeing the impact of our multifaceted growth strategy, supported by our differentiated market position, scale, and client focus. One prime example is the momentum we have through new business wins. Following a standout 2024 with significant client renewals and new partnerships, we see meaningful growth potential from our robust new business pipeline that we expect to lead to policy expansion over time. As we continue to scale, we expect to sustain disciplined expense management to underpin our growth. In renters, Our increasing scale is reinforced by technology-enabled services, particularly our Cover360 platform in the expanding PMC channel. This platform has helped deepen relationships with existing clients and win new business, supporting sustained double-digit premium growth and increasing penetration rates for renters' policies. During the third quarter, we completed a multi-year renewal with the largest PMC in the U.S., and signed two new PMC partnerships. We continue to see benefits from the new renters portfolio that we onboarded earlier this year, adding scale and identifying opportunities to further expand our footprint in the PMC market. Across both homeowners and renters, our strategic investments in technology and operational efficiencies continue to drive improved margins and better customer experiences. Global housing is a cornerstone of our business, delivering strong results today while positioning us well for the future. Assurance long-term strength and resilience set us apart in the P&C space. Over the last five years, we've delivered a compound annual growth rate of 12% for adjusted EBITDA and 18% for adjusted EPS, both excluding catastrophes. Our average ROE from 2019 to 2024 outperformed the S&P 1500 P&C index median with less than half the volatility. While our five-year average ROE of approximately 13% reflects the impact of prior acquisitions, our average return on tangible equity over the same period trended above 30%, well above the median of the P&C index, a testament to our earnings power and differentiated returns. Our unique and advantaged portfolio of lifestyle and housing businesses has created diversified sources of earnings and capital, generating strong returns, robust cash flow, and strong growth with lower volatility. Looking ahead, we remain laser-focused on finishing the year strong and building for 2026. Although we see power in the diversification in our business, we are pleased to drive growth in 2025 across our global housing, connected living, and global automotive businesses. We're well-positioned for future growth as we expand offerings with a focus on increasing attachment rates with existing partners, winning new clients across the globe, and prioritizing investments in our core markets. That includes launching new products and services across both lifestyle and housing and continuing to embed innovation across everything we do, from AI-powered tech support and personalized solutions to robotics in our device care centers. These enhancements are helping us drive simpler, faster, and more consistent outcomes for our clients, helping them increase the lifetime value of a customer. We see further opportunity for attractive organic growth as we enter adjacent sectors through new product offerings planned for early 2026, creating pathways for growth that align with our strengths and extend our reach. We have a clear strategy and a team that's ready to deliver on the strong momentum we have across global lifestyle and global housing. As we head into the final quarter of the year, we're energized by the progress we've made and we're confident in our ability to continue creating value for stakeholders. I'll now turn it over to Keith Meyer to highlight our third quarter results and expectations for the remainder of the year.