RLI Corp.

Good morning, and welcome to the RLI Corp First Quarter Earnings Teleconference. After management's prepared remarks, we will open the conference up for questions and answers. Before we get started, let me remind everyone that through the course of the teleconference, RLI management may make comments that reflect their intentions, beliefs, and expectations for the future. As always, these forward-looking statements are subject to certain factors and uncertainties, which could cause actual results to differ materially. Please refer to the risk factors described in the company's various SEC filings, including in the annual report on Form 10-K, as supplemented in Forms 10-Q, all of which should be reviewed carefully. The company has filed a Form 8-K with the Securities and Exchange Commission that contains the press release announcing fourth quarter results. During the call, RLI management may refer to operating earnings and earnings per share from operations, which are non-GAAP measures of financial results. RLI's operating earnings and earnings per share from operations consist of net earnings after the elimination of after-tax realized gains or losses, and after-tax unrealized gains or losses on equity securities. Additionally, equity and earnings of unconsolidated investees and related taxes are excluded from operating earnings and operating EPs to present a consistent approach in excluding all unrealized changes in value from equity investments. RLI's management believes these measures are useful in gauging core operating performance across reporting periods, but may not be comparable to other companies' definitions of operating earnings. The Form 8K contains a reconciliation between operating earnings and net earnings. The Form 8K and press release are available at the company's website at www.rlicorp.com. I will now turn the conference over to RLI's President and Chief Executive Officer, Mr. Craig Clythermus. Please go ahead.

Good afternoon, everyone. We appreciate you being with us today. With me are Aaron Diepenfeller, our Chief Financial Officer, and Jen Klobnoch, our Chief Operating Officer. I'll begin by saying we feel good about how we started 2026 and the position we're in as we move through the year. For the quarter, we generated an 86 combined ratio, premiums grew 3% led by casualty, and net investment income increased 15%, continuing to be a meaningful contributor to overall results. Compared to a very strong first quarter last year, results were still excellent, but a bit more tempered, driven primarily by catastrophe activity, discipline growth, and normal variability that comes with taking on insurance risk. Stepping back, the underlying business is performing well and consistent with our expectations. The insurance marketplace continues to be dynamic. We're seeing more competition in some areas from broker-owned facilities and MGAs that operate with incentives that are not always aligned with long-term underwriting profitability. In the most competitive spaces, we are picking our spots, finding rate adequacy on accounts where it's still available, focusing on producer relationships, and adding value to customers that want our expertise and service. We are seeing rate acceleration and market disruption in wheels-based products. There's opportunity here when done with discipline and vigilance. Our underwriting and claims expertise positions us to select the right accounts, achieve the rate we need, and drive better claim outcomes over time. Adding to the general market disruption is the emergence and rapid adoption of artificial intelligence. along with the regulatory uncertainty that comes with it. We're encouraged by what we're seeing with AI, not as a headline, but as a tool. It's helping us put better data in the hands of decision makers, making us more responsive, more efficient, easier to do business with, while keeping human intelligence and judgment at the core of everything we do. Market dislocation creates opportunities for those with the confidence and financial strength to act. We have both. Our efforts will continue to be grounded in the same timeless core values that have guided RLI for over 60 years, community, customer focus, and continuous improvement. We like the position we are in. We're seeing opportunities in the right places, and we believe we're well positioned to continue delivering consistent, profitable results over time. With that, I'll turn it over to Aaron to walk through the financials in more detail.

Thanks, Craig, and good afternoon, everyone. Last evening, our first quarter release reflected an increase in gross premiums of 3% with strong contributions from our casualty segment. Operating earnings were 83 cents per share compared to 89 cents last year and supported by solid underwriting performance and a 15% increase in investment income. As a reminder, in the fourth quarter of 2025, began to exclude earnings of unconsolidated investees from our definition of operating earnings all comparables in our release reflect that change underwriting income was 58 million in the quarter benefiting from 35.5 million of favorable prior year reserve development offset by 16 million of catastrophes and a higher underlying combined ratio on a gap basis first quarter net earnings totaled 60 cents per share, compared to 68 cents in the year-ago period. As was true in the first quarter of 2025, the largest driver of the differential from operating earnings was the negative return in our equity portfolio and the associated 39 million of unrealized losses. At the segment level, casualty growth totaled 10% for the quarter, with significant contributions from personal umbrella and commercial transportation, both of which continue to benefit from rate increases. In terms of the underwriting results, Casualty posted a 97 combined ratio, outperforming 2025 by two points and inclusive of higher levels of favorable prior year development at 14.5 million. Casualty's reserve development was broad-based with executive products, general liability, professional services, and transportation contributing to the release. It should be noted that of the 16 million of catastrophe losses disclosed in the quarter, 2 million was attributed to packaged businesses and casualties. Property experienced a 9% decline in gross premium, largely due to rate decreases in ENF property, while marine and Hawaii homeowners again afforded offset. Contributing to the bottom line and property's 62 combined ratio was $20.6 million of favorable prior year's reserve development on these shorter tailed lines, offering a 16-point benefit to the segment's loss ratio. Catastrophe events, including the recent storms in Hawaii, totaled $14 million for property, up a bit from events in Q1 2025. Surety's top line growth premium was down about 1% from last year, and the segment reported a 94 combined ratio, largely attributable to limited favorable prior year development compared to a strong release last year. As a reminder, surety loss activity can be variable and can have a significant influence over shorter periods. Operating cash flow for Q1 totaled 43 million, down 60 million from last year, and was influenced by some tax credit purchase activity, bonuses paid, and higher paid losses. The tax credit purchase is notable as it had a significant impact on the 18.5% effective tax rate in the quarter. Despite more modest cash flow, we still had reinvestment opportunities with fixed income purchase yields averaging 4.8% in the portfolio, approximately 60 basis points above our book yield. Recent capital market volatility has moderated and we have primarily focused on putting money to work in investment-grade fixed income. Total return for the portfolio in the quarter totaled a negative 0.4%, with income partially offsetting price declines for both stocks and bonds. Turning to the liability side of the balance sheet, we found an opportunity in late February to access the capital markets and raise $300 million of long-term debt. With our history of consistent financial results, We believe RLI has a terrific credit story. This issuance carries a coupon of 5.38% and a 10-year maturity and returns our leverage profile to our historic average. Alongside the long-term debt, we repaid and upsized our evolving credit facility with PNC Bank. That backstop liquidity in RLI Corp is now $150 million in size and replaced the prior transaction. Looking at overall results, when we isolate on comprehensive earnings of 32 cents per share and adjust for dividends, book value per share increased 2% from year-end 2025. Finally, I'll mention the recent rating action from eInvest, which upgraded the RLI group of companies to A++. This puts RLI in a distinguished category of high-quality P&C companies that have similar financial strength. We view the reaction from AMBES as a recognition of our long track record of underwriting results. All in, we are very pleased with the start to the year. And with that, I'll turn the call over to Jen for more details.