Axis Capital Holdings Limited

Hello, and welcome to the fourth quarter 2022 Access Capital Earnings Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touchtone phone. To withdraw your question, please press star then two. Please note, today's event is being recorded. And now I'd like to turn the conference over to Miranda Hunter, Head of Investor Relations. Ms. Hunter, please go ahead.

Thank you, Operator. Good morning, ladies and gentlemen. I'm happy to welcome you to our conference call to discuss the financial results for Access Capital for the fourth quarter and year ended December 31st, 2022. Our earnings press release and financial supplement were issued last night after market closed. If you would like copies, please visit the investor information section of our website at accesscapital.com. We have set aside an hour for today's call, which is available as an audio webcast on our website. With me today are Albert Benchmull, our president and CEO, Pete Vo, our CFO, and Vince Tizio, CEO of Specialty Insurance and Reinsurance, and our future group CEO. Before I turn the call over to Albert, I will remind everyone that the statements made during the call, including the question and answer section, which are not historical facts, may be forward-looking statements. Forward-looking statements including but not limited to our comments on January renewals involve risks, uncertainties, and assumptions. Actual events or results may differ materially from those projected in our forward-looking statements due to a variety of factors, including the risk factors set forth in our company's most recent report on Form 10-K and our other reports the company files with the SEC. This includes the additional risks identified in the cautionary note regarding forward-looking statements in our earnings press release issued last night. We undertake no obligation to publicly update or revise any forward-looking statements. In addition to this presentation may include non-GAAP financial measures. Reconciliations are included in our earnings press release and our financial supplement. And with that, I'll turn the call over to Albert.

Thank you, Miranda, and welcome to your first taxes conference call. And good morning, everyone, and thank you for joining us. As we commented in our press release, this was a strong quarter to cap a milestone year for Axis. Over the past few years during these investor calls, we've shared our journey with you as we've worked diligently and steadfastly to reposition Axis to be a leading specialty underwriter and create a stronger, more resilient book of business while placing the company on a pathway to generating lasting profitable growth. To accomplish this, we've significantly transformed our business. We drove consistent growth in attractive specialty markets, reduced our exposure to catastrophes, and created a faster, more integrated, and more efficient operating model. We're a very different company today than we were a few years ago, a focused specialty underwriter delivering steadily improving results. To be clear, we're not declaring victory, and we're committed to continue increasing our growth, our profitability, and our efficiency. But we are progressing into 2023 with accelerating momentum underpinned by years of improved underlying performance, strong positions in our chosen markets, and rising demand for specialty coverages. We're confident that we'll not only continue to build on this progress, but that we're well on our way to taking the business to even higher levels. Let's get to the results. So notwithstanding another year where the industry was challenged by catastrophes, financial and social inflation, and Russia's invasion of Ukraine, excluding the impact of MIX, we've improved in our key performance metrics. During the year, we generated record premium production, reduced our expense ratio, grew our underwriting income by 35%, and improved our overall combined ratio by 1.7 points to 95.8. Our specialty insurance business continued to produce excellent results for the quarter and for the year. For the year, we grew our specialty insurance gross written premiums by 15%, net earned premiums by 18%, and underwriting income by 46%. and produced an all-in combined ratio of 89.6, improving both our loss and expense ratios. For Access Re, notwithstanding the finalization of our exit from property and property catastrophe markets mid-year as we focus the business on specialty reinsurance, our market presence remains strong and relevant, as indicated by recent renewal activity. I'm pleased to report that we performed very well the 1-1 renewals. We maintained our disciplined underwriting approach and standards, exited non-target business, all the while remaining close to our customers and brokers. In the end, we successfully bound substantially all the non-property-related renewals that met our thresholds. We estimated losing less than $10 million of desired renewals due to our exits from property and property cat reinsurance where our shares were reduced. In the end, of our addressable non-property-related renewals, We estimate a 90 percent retention ratio, 12.5 percent rate increases, and 7 percent new business, with more than half of the new business coming from targeted credit and surety, cyber, and A&H lines. So, overall, we achieved mid-single-digit growth, XFX, on the renewed part of the portfolio. We're encouraged these statistics indicate that our decision to exit the reinsurance property and cash-free markets did not materially impact our ability to access, and retain the business that we wanted. Our performance during the one-to-one renewal speaks to the value that Access Re brings to the market through the knowledge and expertise of our underwriters and the deep relationships that we share with our customers and brokers. We operate in a competitive environment for sure, and the year is only beginning, but I believe that our performance in recent renewals demonstrates that we have a strong, focused reinsurance business within a broad specialty underwriting company. Importantly, We are in the markets where we want to be and where we have strong positioning that allows us to take advantage of what we expect will be continued favorable conditions for the foreseeable future, buoyed by rising demand for specialty coverage. We've achieved our plan of rebalancing our business in 2022. On a pro forma basis, specialty insurance made up 71% of our gross written premium, and we should report in excess of 75% this year. Moreover, We're taking concerted actions to sustain our growth and build upon our momentum while delivering increased value to our customers. This includes the launch of our dedicated wholesale division with expanded products and resources, investments in product innovation and digital capabilities, expansion into lower middle markets, and efforts to further leverage our global platform to benefit our strategic partners. And we've made this progress while cultivating a strong team and a purpose-driven culture that's earned Axis recognition as a best place to work. We're confident that the best days are ahead for Axis, and we look to the future with excitement. On a personal note, it's been a real privilege to lead Axis during this time of transformation. As we announced last month, after 11 years as president and CEO of Axis, I'll transition my responsibilities to Vince Tizio on May 4th at our annual general meeting. In Vince, we have a fantastic leader who I'm confident has the vision industry knowledge, grit, and tenacity to lead Axis to even greater levels of success. I'm incredibly excited for the future of this company, and I'm confident that with Vince at the wheel, Axis will be in very capable hands. On that note, I'm sure you're eager to hear from both Pete and Vince. And so given the CEO transition, we've adjusted our typical call format. I'll now pass the floor to Pete, who will share our financial summary. Vince will then deliver commentary on the market. I'll come back with some closing comments, and then we'll have our Q&A. But I want to close by saying that for Axis, I firmly believe that our moment has arrived. And with that, I'll pass the floor to Pete. Pete?