Bob Huang

Bob Huang with Morgan Stanley inquired about Progressive's advertising spend strategy, particularly given the deceleration in personal auto policy in-force growth and increased competition. He also sought clarification on the flexibility of ad spending given advance purchases.

Answer

Tricia Griffith, President and CEO of Progressive, explained that ad spending is monitored monthly for efficiency, ensuring cost per sale remains below targeted acquisition costs. She clarified that while some ad buys are made in advance for discounts, a significant majority are auction-based, providing levers to adjust spending based on competition. Growing as fast as possible remains an operating goal.

Bob Huang inquired about Progressive's advertising spend strategy, particularly given increased competition and decelerated personal auto policy-in-force growth, asking if current ad spending levels are sustainable and necessary.

Answer

President and CEO Tricia Griffith explained that advertising spend is monitored monthly for efficiency, ensuring cost per sale is below targeted acquisition costs. While some ad buys are made in advance for discounts, the majority are in the auction market, allowing flexibility to adjust spending based on competition. She reiterated that advertising is a key lever to achieve the company's operating goal of continued growth.

Bob Huang asked about future growth opportunities outside of Kinsale's commercial property division, given a perceived growth deceleration, and which specific areas are most attractive or where the company might pull back.

Answer

Brian Haney, President and COO, indicated widespread opportunities across the book, highlighting newer areas like transportation and agribusiness, as well as continued strong potential in casualty, high-value homeowners, and personal lines. Michael Kehoe, CEO and Chairman, reiterated confidence, noting double-digit growth in all property lines except large commercial property for the quarter.

Bob Huang from Morgan Stanley inquired about future growth opportunities outside of Kinsale's commercial property division, given a slight deceleration in overall growth, and asked which specific areas are most attractive for expansion or where the company might pull back. He also asked about Kinsale's technology strategy, including new innovations, implementation of emerging technologies, and areas where tech provides a competitive advantage.

Answer

Brian Haney, President and COO, highlighted opportunities across the entire book, specifically mentioning transportation, agribusiness, casualty, high-value homeowners, and personal lines. Michael Kehoe, CEO and Chairman, added that all property lines, excluding large commercial property, grew at a double-digit rate. Regarding technology, Mr. Kehoe explained Kinsale's long-standing commitment to tech as a core competency, including building its own enterprise system and undertaking a complete rewrite with 'target state architecture.' He noted the use of new AI tools in IT, underwriting, and claims to drive automation, contributing to Kinsale's significant cost advantage.

Bob Huang asked about the Japan reinsurance opportunities.

Answer

CEO Tony Cheng described it as exciting and early in the cycle, focusing on asset transactions with biometric risk and long-term relationships.