Axis Capital Holdings Limited

Good day and welcome to the second quarter 2024 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 telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Cliff Gallant, Head of Investor Relations. Please go ahead.

Thank you. Good morning, and welcome to our second quarter 2024 conference call. Our earnings press release and financial supplement were issued last night. If you would like copies, please visit the investor information section of our website at accesscapital.com. We set aside an hour for today's call, which is also available as an audio webcast on our website. Joining me on today's call are Vince Tizio, our President and CEO, and Pete Vogt, our CFO. In addition, I would like to remind everyone that the statements made during this call, including the question and answer section, which are not historical facts, may be forward-looking statements. Forward-looking statements involve risks, 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 our call. During the second quarter and first half of the year, we continued to make strong progress against our stated strategy of achieving specialty underwriting leadership. Indeed, our performance during the quarter demonstrated advancements across the key metrics we outlined at our Investor Day this past May. Before unpacking our results, I'll take a moment to thank my AXIS colleagues, We're operating in a dynamic market requiring increased collaboration, consistency, and a resilient attitude, and I'm proud of our team's commitment to providing excellent service to our brokers and customers. Let's now review some of the headline results from the second quarter. Our annualized operating ROE was 20 percent, driven by strength across the vast majority of our business lines. We produced operating earnings per share of 293, a 31.5% increase over the prior year quarter, and the highest quarterly operating earnings per share in the company's history. Our diluted book value per share was 59.29. Overall premiums were up 6.8%, driven by solid growth across both insurance and reinsurance, which were up approximately eight and four percentage points over the prior year quarter, respectively. Our overall underwriting profitability remained strong with a 90.4 combined ratio. Our attritional loss ratio improved a point versus the prior year quarter at 55.1. Net investment income increased 40% or 54 million as compared to the prior year quarter. Let's now move to our operating segments and we'll start first with insurance. In the quarter, our insurance business performed very well. We generated a combined ratio of 87.9, with premium production of 1.8 billion, 17 percent net written premium growth, record new business premiums of 576 million, with particularly strong contributions from our property lines. In North America, we continue to see a healthy demand for our specialty products and capabilities. New business was up 18 percent as compared to the prior year quarter. Within the wholesale channel, we saw submissions increase 24%, marking the 10th quarter in a row where submission growth has been double digits. Two of our wholesale business units, property and excess casualty, were up 25% and 16%, respectively, over the prior year quarter. As regards the new initiatives mentioned at Investor Day, our distribution partners' response is strong. It is early days, but our inland marine, U.S. construction capabilities are being recognized. Our expanded environmental team had a strong quarter and positive momentum. In addition, our dedicated wholesale lower middle market business is starting to take hold with 20% premium growth over the prior year quarter. We continue to cycle manage the portfolio. By example, during the quarter, we continue to reshape our primary casualty, cyber small and delegated, and public D&O portfolios, while refocusing our underwriting appetite to areas of opportunity. I'll speak more to this when we discuss market conditions. Moving to global markets, our results were highlighted by double-digit growth across a number of our lines, construction, global property, credit. In the London market, we are observing increasing levels of competition. However, our portfolio remains highly rate adequate and has a diverse product set of offerings to service a wide net of customers' needs and broker expectations. As previously shared, we launched our new energy transition syndicate on April 1st, and we're already seeing positive response from our distribution partners and encouraging signs that our syndicate, over time, will be a meaningful contributor in future years. Finally, our specialist capabilities in marine war provided opportunistic growth while meeting our customers' needs. Moving to our reinsurance business, we delivered an 89-3 combined ratio while generating $46 million in underwriting profit. These results reflect our continued progress in repositioning the business. During the quarter, we continued to lean into our specialty lines, including credit insurity, A&H, cyber, and agriculture, with specialty businesses growing more than twice the 4% we delivered for the reinsurance portfolio in totals. We continue to see meaningful opportunities in cyber while maintaining prudent limit deployment and balance with our insurance portfolio. As respects casualty and professional lines, we remain vigilant and selective as we have not evidenced the degree of rate change and seating commission changes that we expected. During the 1-7 renewal season, where approximately 13% of our business is up for renewal, We saw continued positive submission flow in our targeted specialty growth lines while we continue to navigate a competitive reinsurance market, particularly in professional and casualty lines. I'll now take a moment to comment on overall market conditions. Conditions continue to be generally favorable, and premium adequacy across our portfolio remains strong for both new and renewal business. Within our insurance, our limit profile remains virtually unchanged from prior quarters and aligns with our portfolio objectives. In addition, we continue to make shift towards short tail lines, which in the quarter formed 52% of our group gross premiums written, up approximately 4% as compared to the prior year quarter. These lines are strongly priced and match our underwriting capabilities and needs of our brokers and customers. In the quarter, we observed heightened competition in our property businesses. Notwithstanding, we continue to see strong submission flow and premium growth. We feel confident about our portfolio construction, particularly our average net limits, geographic spread of the business, peril mix, and outbound event attachment point of 100 million as we look toward what is forecasted as a busy third quarter win season. In liability, we have evidenced a resurgence of rate. Within our U.S. casualty business, we continue to see double-digit rate increases that continue to perform ahead of trend. U.S. primary casualty and U.S. excess casualty were up 27% and 12% respectively. In our primary casualty business, a book that we previously noted as being reshaped, written premium was down $52 million quarter over quarter. We expect our repositioning of the business to last throughout the year. Excluding the actions within primary casualty, our insurance segment growth during the second quarter was over 11% as compared to the prior year quarter. Finally, within liability reinsurance, rates were up close to double digit and ahead of trend. As I've commented in past calls, within insurance, we remain vigilant in managing our professional lines portfolio particularly in public D&O, where pricing continues to be inadequate. This is being offset by the growth that we're driving across select premium adequate lines, such as our U.S. D&O business, which grew 10% in the quarter, and our transactional liability class, which grew 62%, albeit off a relatively small base. As respects cyber, we continue focusing on growing the large account segment while selectively targeting and reshaping our small and delegated businesses. By example, we expanded our partnership with Alpha Secure, an insurtech that blends cyber insurance with advanced diagnostics and security software, which will help enhance risk selection for our small cyber portfolios, while over time extending these capabilities to our broader cyber portfolio. Looking at the performance across both segments, we're pleased with the second quarter. Our previously shared guideposts of producing 7 to 12 percent annual premium growth for insurance and single-digit growth for our reinsurance business are unchanged. Pete will give more detail shortly. Stepping back, in the second quarter, we produced earning results that demonstrated what we said at our investor day. We grew our diluted book value per share and produced strong financial results. We drove profitable growth by leaning into our targeted specialty markets and tapping into new growth opportunities. We continued making improvements to our operating model to improve efficiency and productivity. And finally, we are making investments in our platform to align with our go-forward strategic imperatives. During the quarter, we made tangible progress in advancing our How We Work program to enhance all aspects of how we operate and go to market. This includes implementing improvements focused on heightening our organizational effectiveness and making investments to empower our colleagues and optimize their productivity while improving service quality. We also continue to reinvest in the business to enable sustained profitable growth. This includes further enhancing our claims and operations capabilities, advancing digitization and automation initiatives to increase our agility and response time, improving our tools, technology, and platforms. In summary, it has been a very strong first half of the year for Axis as we continue to execute on our strategy. I'll now turn the call over to Pete for a more detailed discussion of our financials.