Hippo Holdings Inc.

Hello everyone and welcome to the HIPPO Key 1 2023 earnings call. My name is Chach and I'll be the coordinator for this conference. After the presentation there will be a Q&A session where you can ask a question by pressing star followed by 1 on your telephone keypad. If you would like to withdraw your question you may press star 2. I would now like to hand over to Cliff Gallant to begin. Please go ahead.

Thank you operator. Good morning everybody. and thank you for joining HIPPO's first quarter earnings conference call. Earlier, HIPPO issued a shareholder letter announcing its results, which is available at investors.hippo.com. Leading today's discussions will be HIPPO's Chief Executive Officer and President, Rick McCatherin, our Chief Financial Officer, Stuart Ellis. Following management's prepared remarks, we will open up the call to questions. Before we begin, I'd like to remind you that our discussion will contain predictions, expectations, forward-looking statements, and other information about our businesses that are based on management's current expectations as of the date of this presentation. Forward-looking statements include but are not limited to HIPAA's expectations or predictions of financial and business performance and conditions in competitive and industry outlook. Forward-looking statements are subject to risk, uncertainties, and other factors that could cause our actual results to differ materially from historical results and or from our forecast, including those set forth in HIPAA's Form 8 file today. For more information, please refer to the risks, uncertainties, and other factors discussed in HIPAA's SEC filings, in particular in the sections entitled Risk Factors. All cautionary statements are applicable to any forward-looking statements we make whenever they appear. You should carefully consider the risks and uncertainties and other factors discussed in HIPAA's SEC filings. Do not place undue reliance on forward-looking statements, as HIPAA is under no obligation and expressly disclaims any responsibility for updating, altering, or otherwise revising any forward-looking statements. whether as a result of new information, future events, or otherwise, except as required by law. During this conference call, we will also refer to non-GAAP financial measures, such as total generated premium and adjusted EBITDA. Our GAAP results and description of our non-GAAP financial measures with a full reconciliation to GAAP can be found in the first quarter 2023 shareholder letter, which has been furnished to the SEC and available on our website. And with that, I'll turn the call over to Rick McCatherin, our president and CEO.

Good morning, everyone. 2023 is off to an excellent start for HIPPO. We're growing, hitting our goals for operating efficiency, and we continue to have the financial strength to execute on our plans with confidence. We've made significant strides towards profitability and remain on track for achieving adjusted EBITDA profitability by the end of 2024. As I mentioned on our fourth quarter call, Hippo's long-term success comes down to two simple things. First, we need to make the experience of being a Hippo customer the best around. One of our most significant projects in 2023 is building a differentiated consumer agency business. Our aim is to offer the superior Hippo experience to all of our customers, whether they are buying a Hippo home insurance policy or a product from one of our partner carriers. Currently, just over 10% of our customers are buying more than one product through the HIPPO agency, and we expect this percentage to grow substantially over time. Our goal is to delight our customers by exceeding their expectations as their partner in proactively protecting their homes. One tangible example of this strategy is our HIPPO home care service. I'm happy to report that our new home care app is now available for download through both the Apple and Android app stores for all U.S. homeowners, even if they are not yet a HIPPO customer. Through the app, a homeowner can receive a HIPPO home care health score along with maintenance checklist of activities and simple DIY instructions on how to improve their score. You should give it a try. The second key component of long-term success is continuing to use our technology to execute at a high level the financial and operational fundamentals of insurance. As we've discussed previously, our top priority is improving the loss ratio for our HIPPO home insurance program. In the quarter, the U.S. home insurance industry was impacted by high winter weather activity, including 17 atmospheric rivers in California. our second largest state. However, looking beyond the bad weather, our current accident year gross loss ratio excluding PCS-divined cats was 60%, a substantial improvement versus Q1 2022 comparable of 78%. The primary drivers of this improvement were our recent actions in rate and pricing, improved geographical diversification, and our continued success in attracting our Generation Better customers. And this is just the beginning. In 2023, we've submitted filings impacting 46 of our managed products, covering 81% of our premium volume, with 30 of those already receiving regulatory approval, covering half of all of our premiums. And this is just the first quarter. We expect these filings to continue our momentum, further improving our rate segmentation and accuracy. Cumulatively, we have introduced 18 new data-driven rating variables into our rating plans over the last two years. These variables continue to move us down our path of creating a differentiated pricing plan that partners with customers on risks to their home and provides the customers a financial incentive to make improvements. Finally, our technology platform also allows us to benefit from operating leverage as we scale. Operating expenses, excluding loss and loss adjustment expense, were essentially flat versus the prior year quarter, falling as a percentage of TGP from 44% last year to 29% for this quarter. As we've said in the past, much of the heavy development costs of our platform are behind us, and we're rapidly moving towards a period of sustainable, profitable growth. Thank you. Now I'll turn the call over to our CFO, Stuart Ellis.