Axis Capital Holdings Limited

Hello and welcome to the fourth quarter 2023 Access Capital earnings call and webcast. 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 telephone keypad. And to withdraw from the question queue, please press star then two. I would now like to hand the call to Cliff Gallant, Investor Relations. Please go ahead.

Thank you. Good morning, everyone, and welcome to our conference call to discuss the financial results of Axis Capital for the fourth quarter and year, ended December 31, 2023. I'm Cliff Gallant, Investor Relations at Axis. Our earnings press release and financial supplement were issued last night. If you'd like copies, please visit the investor information section of our website at axiscapital.com. We set aside an hour for today's call. which is also available as an audio webcast on our website. Before we begin, I'd like to invite you all to attend our Investor Day, which is being held the morning of May 30th in New York City. Joining me on today's call are Vince Tizio, our President and CEO, and Pete Vo, our CFO. In addition, I would like to 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 involve risk, uncertainties, and assumptions. Actual events or results may differ materially from those projected in the forward-looking statements due to a variety of factors, including the risk factors set forth in the company's most recent report on the Form 10-K or our quarterly report on Form 10-Q and 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, non-GAAP financial measures may be discussed during this conference call. Reconciliations are included in our earnings press release and financial supplement. And with that, I'll turn the call over to Vince.

Thank you, Cliff. Good morning, and thank you for joining us. 2023 was a transformative year for our company. In recent calls, we've spoken to our aspiration to elevate access as a specialty underwriting leader, and our year-end results signal that we've taken important steps toward this ambition. Looking at the year as a whole, we advanced our targeted underwriting strategy, further developed a diversified and resilient portfolio, and strengthened our operating model to meet our financial objectives. Let's discuss some of the headline numbers for the year, which are inclusive of the reserve strengthening that we announced last week. In 2023, we generated operating income of $486 million, return on average common equity of 7.9%, and operating return on equity of 11%. Excluding the reserving strengthening, our return on average common equity and operating return on equity were 15.4 and 18.5, respectively. We achieved record performance in several areas, including our premium production, which was the highest in our company's history at $8.4 billion, and our net investment income was $612 million. Further, we produced 15 percent year-over-year growth in diluted book value per share and delivered a current accident year combined ratio of 91.8, a more than four-point year-over-year improvement. These results combined with the strength of our balance sheet and our capital position are very encouraging. To deliver on our ambition and meet our financial commitments, we will continue to relentlessly execute against our strategy. I'd like to briefly highlight three core elements. First, we continue to operate in attractive markets and are making decisive choices on where to compete, allocate our capital, while tapping new sources of revenue. Access as a specialty underwriter that brings tailored solutions to its targeted markets and distribution channels to deliver consistent earnings generation. We continue to lean into our insurance book, which, as of the year end, makes up close to 75 percent of our gross premiums written. In 2023, our insurance business generated record production every quarter and a calendar year combined ratio of 92.5 On a current accident year basis, that's 87.4. Insurance premiums were up 17% year over year, excluding professional lines. And as we've discussed over the past several quarters, this is a class that we have been reducing, given the pricing environment, particularly in public D&O. We remain well positioned to capitalize on favorable conditions in growing market segments. For instance, Axis is one of the leading players in the U.S. wholesale marketplace, contributing five consecutive years of double-digit growth while yielding a 76 current accident year combined ratio in 2023. We're a global leader in renewable energy, where we see opportunity for further profitable growth as the world transitions to cleaner energy forms. We've committed ourselves to the energy resilience and transition space through the creation of the first-ever Lloyd's Syndicate to exclusively underwrite these risks. We're acting with agility and capitalizing on smart growth opportunities, including adjacent markets where we have not previously played. By example, in the latter part of 2023, within North America, we launched an inland marine unit within weeks they were actively quoting and writing new business. Also, in the past year, we've made strides in scaling our dedicated wholesale lower middle market unit, generating 48% growth year over year. In London, where we're recognized by Lloyd's as a top 10 leader and outperforming syndicate, we're leveraging our global platform to introduce our London specialty products to North America. This includes launching to date U.S. Marine cargo and construction, and will continue to make more investments and product launches. As respects our reinsurance business, we have effectively reshaped Access Re as a targeted specialist reinsurer focused on delivering more consistent profitability and reduced volatility. In 2023, we produced a current action year combined ratio of 93, a six-point improvement year over year. Our momentum was sustained at the 1-1 renewals, where 45% of our business for the year is up for renewal. During the 1-1s, we produced low double-digit growth in our targeted specialist premium adequate lines. Second, we are investing in building best-in-class capabilities in underwriting, claims, and operations. In 2023, we made clear progress across a number of fronts. Our loss ratio for accident year 2023 was 58.6, which is 470 basis points better than accident year 2022. As respects people, we've attracted strong talent to complement our existing team. By example, this includes additions to our underwriting associates in North America and London. And within our claims organization, we've deepened our bench both in the number of teammates and expansion of our skill sets, particularly in liability lines. In both claims and operations, we have repositioned the operating models to more closely align with our underwriting and business priorities while improving efficiencies. Claims, we're growing our data and analytic capabilities to bring insights to our underwriters to help them make continued informed risk selections. Within operations, we're investing in digital and automation to increase our speed of submission intake, and we're continuing to enhance our technology platform with a priority of driving transactional efficiency. In addition, artificial intelligence is an area that we're investing in with a focus of harnessing its power to augment our company's overall effectiveness. Third, we are improving how we operate. to become a more integrated and efficient company. Our How We Work program is at the core of this effort. We are implementing operating model improvements focused on enhancing organizational efficiency, making investments that empower our colleagues and optimize their effectiveness while improving service quality, accelerating growth, and ensuring more consistent, profitable returns are delivered. Our progress will be evidence by our sustained underwriting results and an improving expense ratio contemplated with engaged associates that are collectively focused on achieving our financial objectives. Ultimately, it is our expectation that Access will deliver a consistent low 90s combined ratio and expense ratio in the low 30s, double-digit ROE and book value per share growth. Finally, Just a few words on impressions for the 2024 operating year. We entered the year with confidence and momentum, and we believe we're well-positioned to take advantage of generally favorable markets. As I've noted, we have a number of investments that are underway, investments in our people, our operating capabilities, and our suite of specialty products. And we're progressing our How We Work program to enable the advancement of our ambitions In sum, we're supported by a team that's focused and excited to continue bringing value to our brokers, our customers, and stakeholders, and we're united in the pursuit of our strategic objectives. I'll now pass the floor to Pete, who will detail our fourth quarter and full year 2023 results.