Elyse Greenspan

Elyse Greenspan inquired about the organic growth outlook by business segment for 2026 and whether any segments are expected to start the year in negative territory, given the improving cadence throughout the year. She also asked what portion of the $250 million share repurchase program is assumed in the outlined EPS guidance and for an update on market impact (rate and exposure) observed quarter-to-date in Q1 2026 compared to Q4 2025.

Answer

Trevor Baldwin, CEO of Baldwin Group, declined to provide segment-specific organic growth outlooks but confirmed that headwinds are incorporated into the mid-single digit or higher guidance, with expectations for double-digit organic growth by Q4. He stated no segments are expected to have negative organic growth for the full year, though Brad Hale, CFO, clarified that MSI might be pressured in Q1 before the QBE transition. Regarding share repurchases, Mr. Baldwin stated no repurchases are assumed in the EPS guidance, and deployment will be opportunistic, estimating a 3% accretion if $125 million were deployed. For market impact, Mr. Baldwin noted that 1/1 employee benefit renewals did not show the same exposure weakness observed in Q3 and Q4 2025.

Elyse Greenspan inquired about the segment-specific organic growth outlook for 2026, whether any businesses are expected to start the year in negative territory, and the assumptions for the share repurchase program within the EPS guidance.

Answer

Trevor Baldwin (CEO, Baldwin Group) declined segment-specific outlooks but confirmed that 2026 guidance incorporates headwinds with finite end dates, expecting organic growth to reach double digits by Q4, with no negative organic growth for any segment for the full year. He clarified that no share repurchases are assumed in the EPS guidance, but an opportunistic $125 million deployment could yield 3% accretion. Brad Hale (CFO, Baldwin Group) noted MIS would be pressured in Q1.

Elyse Greenspan asked about the outlook for Policies In Force (PIF) growth in 2026, specifically the expected ramp-up from the 525,000 State Farm policies. She also inquired about the anticipated trend of the loss ratio during 2026, excluding prior year development, compared to 2025.

Answer

CFO Patrick McClymont explained that State Farm conversions are accelerating significantly in 2026, aiming for near full penetration by year-end, making it a 'big year' for PIF growth. He reiterated that the loss ratio guidance for 2026 remains in the low 40s, around 41%, for planning purposes, with potential adjustments later in the year as more information becomes available.

Elyse Greenspan asked for the 2026 outlook on policies in force (PIF) growth, specifically the expected ramp-up from the 525,000 State Farm policies. She also sought color on the anticipated loss ratio trend for 2026, excluding prior year development, compared to 2025.

Answer

CFO Patrick McClymont stated that by the end of 2025, State Farm was rolled out in 27 states, with seven undergoing conversions. He indicated that 2026 would be a significant year for accelerating conversions, with most states expected to be fully operational by year-end, though full conversion of all 525,000 policies would extend into 2027. For the loss ratio, Mr. McClymont reiterated that Hagerty plans for it to be in the low 40s, around 41%, for 2026, consistent with previous guidance.

Elyse Greenspan asked for a breakdown of the accelerating annual PIF growth in 2026, specifically how much would stem from improved retention versus independent agent channel growth and national footprint expansion. She also inquired about the long-term premium per policy for autonomous vehicles (AVs) compared to non-AVs, considering lower frequency versus potentially higher severity.

Answer

CFO Megan Binkley stated that Root aims to invest in growth across all channels in 2026, expecting year-over-year increases in gross written premium, PIF, and premium in force, building on their pricing advantage. She cautioned against a direct Q1 2025 year-over-year comparison due to exceptional growth in that period from tariff-related pull-forward. Co-founder and CEO Alex Timm noted that fully autonomous vehicles currently still show rising loss costs, but he believes vehicle technology will progress, leading to significantly fewer accidents. He emphasized the importance of nuanced data application (e.g., lidar vs. camera, city vs. highway use) and highlighted Root's strong position with OEM partnerships to insure these vehicles, anticipating a hybrid world of personal and product liability.

Elyse Greenspan of Wells Fargo asked about the drivers of Q1 policy growth, the potential impact of auto tariffs on pricing, and the outlook for sustained profitability for the rest of the year.

Answer

CEO Alex Timm acknowledged that Q1 growth was amplified by typical tax season seasonality and a potential pull-forward of demand due to looming tariffs. CFO Megan Binkley added that policy growth was flat quarter-to-date in Q2, in line with expectations after a large Q1 cohort. Regarding tariffs, Timm stated they expect a low- to mid-single-digit loss ratio impact, which they believe can be absorbed by current margins, but they will take rate if necessary, leveraging their agile tech platform. Binkley cautioned against extrapolating Q1 profitability, noting that loss ratios are expected to rise in Q2 and Q3 due to seasonal weather events, aligning with their long-term 60-65% target.

Elyse Greenspan of Wells Fargo asked where the loss ratio might settle in 2025 given planned rate reductions, what the earnings outlook is following recent profitability, and about the potential impact of tariffs on loss trends.

Answer

CEO Alex Timm projected a low to mid-single-digit loss trend for 2025, which, combined with rate decreases, may lead to a slight, non-material increase in the loss ratio. He emphasized that the company does not manage to quarterly earnings but to lifetime customer value, and investments in growth may pressure short-term GAAP profitability. Regarding tariffs, Timm stated they are not currently predicting any impact but are prepared to react quickly using their technology platform if the environment changes.

Elyse Greenspan asked about Ryan Specialty's 2026 organic growth guidance, particularly in light of continued property price declines and moderating casualty growth, and the company's views on AI impacts on the brokerage sector.

Answer

CFO Janice Hamilton and CEO Tim Turner explained that the 2026 organic growth guidance reflects intensified property pricing declines, especially in large accounts, and a moderation of strong casualty growth seen in 2025. They noted continued opportunities in niche casualty lines and new business capture. Founder and Executive Chairman Pat Ryan stated that AI is viewed as an ally for improving productivity and speed to market, not an adversary that would disintermediate brokers.

Elyse Greenspan asked about the 2026 organic growth guidance, specifically how property price declines and overall market changes compare to 2025, and the potential impact of AI on Ryan Specialty and the broader brokerage sector.

Answer

CFO Janice Hamilton explained that the 2026 guidance reflects intensified property pricing declines (25-35% in large accounts) and moderating casualty growth. CEO Tim Turner added that niche firming in casualty and professional liability, along with increased business flow, present opportunities. Founder and Executive Chairman Pat Ryan stated that Ryan Specialty views AI as an ally for efficiency, productivity, and speed to market, not a disintermediator, emphasizing the timeless value of advice and advocacy.

Elyse Greenspan of Wells Fargo inquired about the severity of property pricing declines in June, whether the updated guidance assumes these trends continue, the drivers behind the revised margin outlook, and the expected trajectory of margin expansion towards the 2027 target.

Answer

CFO Janice Hamilton confirmed that a rapid decline in property pricing in June impacted Q2 results and that the new guidance assumes these challenging conditions persist for the remainder of 2025. CEO Timothy Turner quantified the decline, noting rate reductions accelerated to 20-30% in the quarter. Hamilton attributed the margin guidance revision to both property headwinds and strategic investments in Ryan Re and alternative risk, while reaffirming the company's commitment to its 35% margin target for 2027 but declining to specify the path to get there.

Elyse Greenspan asked about quarterly growth seasonality within the annual guidance, M&A capacity given leverage is near the top of its target range, and for commentary on recent stamping office data that suggested a slowdown in April.

Answer

CFO Janice Hamilton and CEO Tim Turner confirmed Q2 has the toughest property comp but reiterated full-year guidance, which assumes modest property growth. On M&A, Ms. Hamilton noted leverage was 3.8x as expected and would decline significantly by year-end, providing 'ample capacity' for deals. Executive Chairman Patrick Ryan added it's a 'buyer's market.' Regarding market flow, Mr. Turner dismissed concerns about a slowdown, expressing enthusiasm for stamping results in key states like California and the continued trend of business being shed from the admitted market.

Elyse Greenspan asked about the assumptions for property growth within the 2025 organic revenue guidance, the drivers of the planned 'higher than average investment year,' and for clarification on the 2027 margin target.

Answer

CFO Janice Hamilton explained the 11-13% organic growth guidance is driven by secular trends, strong new business, and casualty strength, with modest growth expected in property. CEO Tim Turner added that strong flow and market share wins are offsetting property pricing softness. Regarding margins, Janice Hamilton and President Jeremiah Bickham noted that savings from the ACCELERATE 2025 program provide flexibility for larger investments in talent and platform enhancements while still expanding margins. Janice Hamilton confirmed the 35% margin target is for the full year 2027.

Elyse Greenspan inquired about the drivers behind the Q4 organic growth outlook, which implies an acceleration from Q3. She also asked about the potential impact of post-hurricane property market hardening on Q4 results, the effect of recent storms on contingent commissions, and sought details on the Innovisk acquisition's purchase price and margin profile.

Answer

An executive team member, along with Director of Investor Relations Miles Wuller and CEO Timothy Turner, explained that while Q3 property rates were challenging, strong new business flow drove healthy growth. They noted that Q4 is off to a promising start with signs of property market stabilization. Regarding contingent commissions, an executive stated they have exceeded expectations and this trend is expected to continue. For the Innovisk deal, the team confirmed its $58 million revenue and higher-margin profile but stated it would not materially impact the company's overall margin and declined to disclose the purchase price.

Elyse Greenspan sought clarification on AIG's capital management plan for 2026, specifically confirming if the stated minimum of $1 billion in share repurchases is a baseline, with Corebridge monetization proceeds being additional.

Answer

Peter Zaffino, Chairman and CEO of AIG, confirmed that $1 billion is the baseline for common share repurchases in 2026. He added that the vast majority of any proceeds received from the sell-down of the remaining Corebridge position would be deployed into additional share repurchases.

Elyse Greenspan from Wells Fargo inquired about the loss cost trend assumptions underlying the 6% pricing increase in North America commercial ex-property, and asked about pricing trends observed in July.

Answer

Chairman & CEO Peter Zaffino responded that while AIG would not break down loss trends by line, the areas with the strongest rate increases, such as excess casualty, are those with higher loss cost trends, ensuring pricing remains adequate. Regarding July, Mr. Zaffino stated that it was too premature to provide specifics but noted that no concerning or significantly different trends from Q2 had been observed so far.

Elyse Greenspan from Wells Fargo sought clarity on the drivers of the improved North America Commercial ex-cat accident year loss ratio and asked about the expected business mix shift between property and casualty.

Answer

Chairman and CEO Peter Zaffino, along with executive Donald Bailey, explained that after adjusting for a one-off closeout transaction and favorable prior-year property experience, the resulting loss ratio is sustainable. For the future mix, Peter Zaffino noted that while casualty growth remains strong, he is optimistic that the property rate environment will improve, reversing its recent slowdown. Executive Jon Hancock added that international specialty lines like energy and marine also present significant growth opportunities.

Elyse Greenspan asked about opportunities in property cat at the 1/1 renewals and expected growth in property cat reinsurance for 2026. She also inquired about the pace of share buybacks, noting the significant $350 million in a little over a month, and the expected premium impact and seasonality of the MCE re-underwriting.

Answer

CEO Nicolas Papadopoulo clarified that the opportunities referred to were in other geographies and specialty lines, not property cat. CFO François Morin stated that share buybacks are a good way to return capital, with no set target, but activity depends on stock price and capital deployment, expecting Arch to be active throughout the year. Regarding MCE re-underwriting, François Morin noted no seasonality, with the impact on the top line expected in 2026, hoping to offset reductions with growth in middle-market business.

Elyse Greenspan at Wells Fargo Securities inquired about opportunities offsetting property catastrophe rate declines at 1/1, the expected growth in property cat reinsurance for 2026, the anticipated pace and level of share buybacks, and the premium impact and seasonality of MCE re-underwriting.

Answer

CEO Nicolas Papadopoulo clarified that the opportunities mentioned were primarily in other geographies and specialty lines, not property cat. CFO and Treasurer François Morin stated that share buybacks are a flexible way to return capital, with no set target, but active participation is expected given market conditions. He also noted that MCE re-underwriting impacts will start affecting the top line in 2026, with business distributed evenly throughout the year, and the goal is to offset reductions with growth in middle-market business.

Elyse Greenspan asked about Arch Capital's capital allocation strategy, specifically comparing share buybacks to special dividends for future capital returns, and inquired about the outlook for insurance premium growth given the mid-corp deal non-renewals and market softening. She also asked for high-level thoughts on a potential hurricane impacting the Caribbean.

Answer

CFO Francois Morin stated that share buybacks are currently the preferred method for capital return due to strong earnings and attractive stock price, noting that a special dividend and buybacks are unlikely simultaneously. CEO Nicolas Papadopoulo expressed bullishness on the insurance business, expecting growth better than the market, driven by casualty rate increases and middle market expansion, offsetting headwinds in professional lines and E&S property. Both executives noted it was too early to assess the hurricane's impact, but mentioned potential exposure to resorts.

Elyse Greenspan asked about Arch Capital's capital allocation strategy, specifically regarding the future level of share buybacks versus special dividends, and the premium growth outlook for the insurance segment considering mid-corp deal non-renewals and market softening. She also inquired about potential exposure to a hurricane impacting the Caribbean.

Answer

François Morin (EVP, CFO, and Treasurer) stated that share buybacks are the preferred method for capital return in the short term, given strong earnings and limited aggressive growth opportunities, and that the strong balance sheet allows for more buybacks. Nicolas Papadopoulo (CEO) expressed bullishness on the insurance business, expecting growth better than the market, driven by casualty and middle market lines, with moderating headwinds in professional lines and cyber. He noted it was too early to assess the hurricane's impact, but resorts could be affected.

Elyse Greenspan inquired about the premium growth outlook for the Insurance segment excluding the MCE acquisition, the company's current stance on excess capital and share buybacks, and any adverse development from the UK/Russia aviation ruling.

Answer

CEO Nicolas Papadopoulo noted that ex-MCE growth was modest due to pivoting towards casualty lines while facing headwinds in professional lines. CFO & Treasurer François Morin confirmed a strong capital position, stating that capital return is a focus and the company may not slow buybacks during wind season. Morin also acknowledged an increase in IBNR for the Russia/Ukraine conflict, which was absorbed within overall reserves, resulting in net favorable development.

Elyse Greenspan sought clarification on the adjusted reinsurance growth calculation, asked about the pricing and demand outlook for mid-year renewals, and questioned the run-rate for the core insurance underlying loss ratio.

Answer

CFO François Morin clarified the growth calculation and noted that while core insurance margins are holding up, a mix shift toward casualty could slightly increase the underlying loss ratio. Executive Nicolas Alain Papadopoulo described the mid-year renewal pricing for Florida as 'flattish,' with opportunities to deploy more capital due to increased demand from cedents.

Elyse Greenspan of Wells Fargo & Company inquired about the ongoing insurance underlying loss ratio post-MidCorp acquisition, the rationale for increasing the reinsurance PML, the market impact of the California wildfires, and the specifics of the 2025 cat load guidance.

Answer

François Morin, an executive, confirmed the MidCorp deal adds about one point to the insurance loss ratio and clarified the 7-8% cat load is a forward-looking estimate, not inclusive of the recent wildfires. Nicolas Alain Papadopoulo, an executive, stated the PML increase reflects attractive opportunities and expects the wildfires to temper market competition and support rates. He also reaffirmed the long-term low 90s combined ratio target for MidCorp post-integration.

Elyse Greenspan of Wells Fargo inquired about the financial impact of the Allianz MidCorp acquisition on the insurance segment's loss ratio, reinsurance margin trends, capital return plans, Hurricane Helene's market share, and the agenda for the upcoming Investor Day.

Answer

Executive François Morin explained that the MidCorp deal added approximately 70 basis points to the insurance segment's ex-cat loss ratio. He noted that reinsurance margin trends are stable on a trailing 12-month basis and that capital return is an active discussion, especially post-wind season. Morin also clarified that Hurricane Helene's market share is not a direct proxy for Hurricane Milton and expressed comfort with current reserve levels, adding that no major strategic shifts are planned for the Investor Day.

Elyse Greenspan asked about Allstate's capital allocation priorities, specifically if the new, larger buyback program indicates share repurchase is prioritized over M&A. She also sought clarification on why average gross premiums written per policy turned negative in the fourth quarter despite positive price trends.

Answer

CEO Thomas J. Wilson outlined capital priorities: first, organic growth to drive stock re-rating; second, M&A where Allstate can be a 'better owner' (e.g., SquareTrade, National General); and third, returning excess capital to shareholders via buybacks, viewing the stock as undervalued. Regarding premiums, Mr. Wilson explained the complexity of analyzing average premium per policy due to factors like mix, coverages, and state levels. He reiterated Allstate's focus on providing affordable prices while maintaining target margins, noting the $800 million in price reductions this year and the expectation that the combined ratio might drift up with faster growth.

Elyse Greenspan questioned why average gross premiums written per policy turned negative in the fourth quarter, despite positive price running through the book, seeking to reconcile these figures.

Answer

Thomas J. Wilson (CEO, Allstate Corporation) explained that the negative trend is a complex result of various factors including rates, mix of business, coverages, and state levels. He linked it to the SAVE program, which reduced premiums for 7.8 million customers by an average of 17% through optimized coverages and discounts, aiming for affordability while maintaining target margins.

Elyse Greenspan from Wells Fargo inquired about Allstate's capital deployment strategy, specifically balancing share buybacks with increased excess capital at the parent company, and whether M&A is a factor in holding capital.

Answer

CEO Tom Wilson clarified that the $1.5 billion share buyback program was pre-approved and executed over a set period, not adjusted monthly based on earnings. He stated that Allstate always has ample capital and does not sequester funds for M&A, but rather makes decisions on organic growth or acquisitions as opportunities arise, prioritizing shareholder value.

Elyse Greenspan from Wells Fargo inquired about Allstate's capital deployment strategy, specifically balancing share buybacks with increased excess capital at the parent company, and whether M&A is a factor in holding capital.

Answer

CEO Tom Wilson clarified that the $1.5 billion share buyback program was pre-approved and executed over a set period, not adjusted monthly based on earnings. He stated that Allstate always has ample capital and does not sequester funds for M&A, but rather makes decisions on organic growth or acquisitions as opportunities arise, prioritizing shareholder value.

Elyse Greenspan inquired if March policy growth was affected by a pull-forward of car purchases ahead of tariffs. She also asked how Allstate would manage a potential mid-single-digit severity increase from tariffs, questioning if they would absorb it or raise prices.

Answer

Thomas Wilson (executive) responded that it was impossible to determine if there was a pull-forward effect on policy growth. Regarding tariffs, he stated Allstate will manage through the impact just as it did with pandemic-related inflation. While the exact impact is unknown, costs are likely to rise, and the company will raise prices if necessary to protect its thin margins, while also leveraging tort reform and cost-cutting initiatives.

Elyse Greenspan asked about RenaissanceRe's full-year 2026 outlook for property catastrophe premiums, specifically if the mid-single-digit decline expectation includes assumptions for pricing trends in mid-year renewals. She also inquired about the drivers behind the projected increase in the 2026 expense ratio (5%-5.5%) compared to 2025's 4.7%, clarifying if this guidance incorporates the benefit of Bermuda tax credits.

Answer

Kevin J. O'Donnell, President and CEO, confirmed the full-year expectation, noting anticipated continued rate reductions but strong rate adequacy in mid-year U.S.-focused renewals. Bob Qutub, Executive Vice President and CFO, clarified the 2026 expense ratio guidance is net of tax credits and reflects ongoing investments in infrastructure, technology, and personnel to manage the increased scale from the Validus integration.

Elyse Greenspan inquired about RenaissanceRe's 2026 Property Catastrophe premium outlook, specifically confirming the mid-single-digit decline expectation for the full year and the pricing assumptions for mid-year renewals. She also asked for clarification on the 5%-5.5% expense ratio guidance for 2026, questioning if it includes Bermuda tax credits and identifying the investments driving the increase from 2025's 4.7%.

Answer

Kevin J. O'Donnell, President and CEO, confirmed the full-year expectation for Property Catastrophe premiums, anticipating continued rate reductions into mid-year renewals but noted strong rate adequacy in U.S.-focused renewals. Bob Qutub, EVP and CFO, clarified that the expense ratio guidance is after the tax credit benefit and attributed the increase to ongoing investments in infrastructure, technology, and personnel to manage increased scale and operational complexity post-Validus acquisition.

Elyse Greenspan inquired about the expected 'normal' contribution of fee income and net investment income to RenaissanceRe's operating return on average common equity for 2026, building on the 15-point contribution observed year-to-date. She also asked about the anticipated Return on Equity (ROE) for catastrophe business written in 2026, considering a projected 10% decline in pricing.

Answer

EVP and CFO Bob Qutub clarified that the 15-point contribution was for the full year, not just a low CAT quarter, with investment income typically contributing 11-12% and fees around 3%+. President and CEO Kevin O'Donnell explained that a 10% rate reduction in property catastrophe would primarily reduce excess margin, not bring returns below adequacy, maintaining strong profitability. EVP and Chief Underwriting Officer David Marra added that terms and conditions are expected to largely persist, allowing the team to select the best risks.

Elyse Greenspan inquired about the expected 'normal' contribution of fee income and net investment income to RenaissanceRe's operating return on average common equity for 2026, building on the 15-point contribution observed year-to-date. She also asked about the anticipated Return on Equity (ROE) for catastrophe business written in 2026, considering a projected 10% decline in pricing.

Answer

EVP and CFO Bob Qutub clarified that the 15-point contribution was for the full year, not just a low CAT quarter, with investment income typically contributing 11-12% and fees around 3%+. President and CEO Kevin O'Donnell explained that a 10% rate reduction in property catastrophe would primarily reduce excess margin, not bring returns below adequacy, maintaining strong profitability. EVP and Chief Underwriting Officer David Marra added that terms and conditions are expected to largely persist, allowing the team to select the best risks.

Elyse Greenspan of Wells Fargo inquired about the specific drivers of the Q2 property cat reserve releases and sought insights into the company's strategic outlook for the 2026 renewal season.

Answer

EVP & CFO Robert Qutub clarified that the reserve releases stemmed from multiple accident years, dating back to 2017. President & CEO Kevin O'Donnell added that the market has fundamentally reset, and he expects the 2026 environment to be similar to 2025, expressing confidence in RenaissanceRe's ability to execute its strategy regardless of the upcoming hurricane season's activity.

Elyse Greenspan asked about the impact of the Q1 California wildfire losses on the upcoming midyear renewals, particularly in Florida, and inquired about the rationale for raising the combined ratio guidance for the Casualty & Specialty segment.

Answer

CEO Kevin O'Donnell and EVP & Group Chief Underwriting Officer David Marra responded. They emphasized that the property market's rate adequacy remains exceptional post-2023's reset. For midyear renewals, they see growing demand and favorable trading conditions, allowing for disciplined deployment of capital. Regarding the Casualty & Specialty guidance change to 'high 90s', they explained it reflects a conservative approach, choosing not to immediately recognize positive rate and claims management trends until they are validated by data, despite the market being in a better position than the previous quarter.

Elyse Greenspan questioned why the weaker Q4 results in the Casualty & Specialty segment did not alter the company's forward guidance and inquired about the timing of pricing impacts from the California wildfires on the property catastrophe book.

Answer

CEO Kevin O'Donnell and EVP, Group Chief Underwriting Officer David Marra responded. O'Donnell explained that the company has been proactively managing its general liability book with a high loss trend assumption and is underweight in problematic areas. Marra added that improving rates and claims handling support the current outlook. Regarding property cat, Marra stated that with most U.S. accounts renewing in the next six months, he expects the recent catastrophe losses to reverse the competitive pressure seen at the January 1 renewals, leading to better rate opportunities in the second quarter.

Elyse Greenspan questioned whether the property catastrophe market at the 1/1 renewals would see flat to declining rates, given RenaissanceRe's excess capital and high ROEs. She also asked why the company is waiting until 2025 to book its specialty casualty business to a higher combined ratio if it is already observing rising social inflation trends.

Answer

President and CEO Kevin O'Donnell responded that while rates are currently fair, an estimated $10 billion in new demand for U.S. cat limits in 2025 should help stabilize pricing around current levels. On the casualty question, CFO Robert Qutub and Group Chief Underwriting Officer David Marra clarified that they are already increasing the loss pick for the current accident year on a forward-looking basis. Marra added that the full impact of corrective actions like rate increases and improved claims handling is a cumulative process that will materialize through 2025, making it prudent to adjust next year's outlook now.

Elyse Greenspan asked about the specific drivers of organic growth within Risk and Broking (R&B) for the quarter, requesting a breakdown by line and geography, with particular focus on the significant increase in North America's growth from Q3 to Q4.

Answer

Carl Hess, CEO, and Lucy Clarke, President of Risk and Broking, highlighted R&B's strong 7% organic growth, with Corporate Risk and Broking (CRB) achieving 8% organic growth. They noted significant new business across global markets, particularly in construction, surety, credit, marine, and natural resources. High single-digit growth in CRB North America was attributed to increased M&A activity and new business in specialty lines. Lucy Clarke further explained that while competitive pricing might impact reaching high single-digit growth, the overall mid- to high single-digit guide for 2026 is supported by high retention rates, new business, strategic hiring investments, and the success of the specialization strategy, including opportunities in digital infrastructure and electrification.

Elyse Greenspan asked about the drivers of organic growth within Risk and Broking (R&B) for the quarter, seeking details on revenue growth by line and geography, specifically noting the significant increase in North America from Q3 to Q4. She also inquired about the 2026 R&B organic growth outlook, questioning how the mid- to high single-digit guidance is maintained despite a challenging pricing environment, given new growth opportunities in specialty and M&A.

Answer

Carl Hess, WTW's Chief Executive Officer, provided a broad overview, highlighting R&B's strong 7% organic growth and Corporate Risk and Broking's (CRB) 8% organic revenue growth. Lucy Clarke, President of Risk and Broking, elaborated on CRB's performance, citing significant new business across global markets, particularly in construction, surety, credit, marine, and natural resources, with CRB North America achieving high single-digit growth. Regarding the 2026 outlook, Ms. Clarke acknowledged that pricing improvements for clients could impact reaching high single digits but emphasized that growth is driven by high retention rates, new business, hiring investments, and the success of the specialization strategy, including opportunities in digital infrastructure and electrification.

Elyse Greenspan inquired about the expectations for free cash flow for the full year and the fourth quarter, and then asked for an update on the insurance pricing headwind in the third quarter compared to the second quarter.

Answer

Andrew Krasner, CFO, stated that the favorable second-half free cash flow setup is playing out as expected, with $838 million year-to-date, driven by margin expansion and reduced transformation costs. He expressed confidence in delivering free cash flow margin expansion for 2025 and beyond. Lucy Clarke, President of Risk and Broking, noted that pricing pressure continued in Q3, becoming more meaningful, particularly in property, with most lines softening except North American Casualty. She affirmed the mid-to-high single-digit organic revenue growth expectation for R&B despite pricing developments.

Elyse Greenspan inquired about WTW's free cash flow expectations for the full year and the fourth quarter, and asked for the insurance pricing headwind experienced in the third quarter compared to the second quarter.

Answer

Andrew Krasner, CFO, reiterated confidence in free cash flow margin expansion for 2025 and beyond, citing operating margin expansion, reduced transformation costs, and the TRANZACT divestiture as tailwinds. Lucy Clarke, President of Risk and Broking, stated that pricing pressure continued and became more meaningful in Q3, particularly in property (large and complex segments), with most lines softening except North American Casualty, following five years of pricing increases.

Elyse Greenspan of Wells Fargo questioned the reason for the lowered cost guidance for the reinsurance joint venture and its readiness for 2026. She also asked for the key drivers of the expected 100 basis points of margin expansion in Risk & Broking and for the enterprise overall.

Answer

CFO Andrew Krasner explained the revised JV cost estimate was due to better expense insight and the launch is on track. CEO Carl Hess added they are pleased with the progress. Regarding margins, Andrew Krasner and President of Risk & Broking Lucy Clarke attributed the expected R&B improvement to operating leverage, the global broking platform, and efficiency initiatives like the 'WeDo' organization. For the enterprise, management reiterated that operating leverage and continued efficiency gains are the primary drivers.

Elyse Greenspan inquired about the rationale for the increased share buyback pace relative to the larger increase in operating company dividends, and sought qualitative insights into the Business Insurance underlying margins outlook for 2026, considering pricing, loss trends, and market conditions.

Answer

CFO Beth Bombara explained that the buyback increase reflects a balanced approach, considering the overall dividend increase and the goal of consistent share repurchase levels. CEO Christopher Swift stated that The Hartford aims to maintain discipline and hold onto margins, expecting property to soften and workers' compensation to face slight headwinds, while liability lines (commercial auto, GL) remain firm. Head of Business Insurance A. Morris Tooker added that small business margins are expected to be maintained, while middle and global business growth will be more market-dependent.

Elyse Greenspan inquired about The Hartford's capital allocation strategy, specifically why the increased share buyback pace ($50 million per quarter) was less than the increase in operating company dividends ($400 million for the full year). She also asked for insights into the business insurance underlying margins for 2026, considering pricing and loss trends.

Answer

CFO Beth Bombara explained that the dividend increase was $400 million, not $500 million, and highlighted the recent dividend increase in October, stating the company takes a balanced and consistent approach to share buybacks. CEO Christopher Swift qualitatively addressed BI margins, emphasizing a strong starting position (88.5% UCR in 2025), disciplined underwriting, and growth focus. He noted property softening and workers' comp headwinds, but firm liability pricing, with renewal pricing ex-comp (6.1%) being within a few tenths of loss cost trends. A. Morris Tooker, Head of Business Insurance, added that small business margins are expected to maintain, while middle and global growth will be more market-dependent.

Elyse Greenspan asked about the impact of tariffs on personal auto results in Q3 2025 and expectations for future quarters, specifically if this is embedded in the target margins. She also inquired about the company's consistent $400 million quarterly buyback level, asking what factors would lead to an increase and when such a decision might be communicated.

Answer

Chairman and CEO Christopher Swift stated that the impact of tariffs on personal auto results was negligible in Q3 2025, and appropriate trend picks for loss costs in 2026 will consider tariff pressure, but no significant unusual impacts are anticipated. Regarding buybacks, Christopher Swift reiterated the company's preference for steady, predictable capital management, expressing satisfaction with the current use of excess capital for well-capitalized companies, funding profitable growth, and a healthy dividend, indicating no immediate decisions to change the $400 million quarterly level.

Elyse Greenspan from Wells Fargo inquired about the impact of tariffs on personal auto results in Q3 2025 and future expectations, specifically if this is factored into target margins. She also asked what would be needed to increase the quarterly share buyback from the current $400 million baseline, and if such a decision would be part of a capital plan update.

Answer

Chairman and CEO Chris Swift stated that the impact of tariffs on personal auto was negligible in Q3 2025 and for the full year, noting that appropriate trend picks for loss costs in 2026 would consider any tariff pressure, though not expecting it to be significant. Regarding share buybacks, Mr. Swift emphasized The Hartford's steady and predictable approach to capital deployment, highlighting well-capitalized companies, funding profitable growth, and a healthy dividend. He stated that no decisions have been made to change the current buyback amounts.

Elyse Greenspan of Wells Fargo questioned if the slight margin deceleration in Business Insurance was consistent with full-year guidance. She also sought details on the drivers behind the strong performance in the Employee Benefits life business, particularly regarding mortality trends.

Answer

Chairman & CEO Christopher Swift affirmed satisfaction with the year-to-date Business Insurance margins, viewing them as consistent with expectations. On Employee Benefits, Swift and Head of Employee Benefits Mike Fish attributed the exceptional 9.2% margin to strong LTD recoveries, rate actions, and favorable life mortality, including unusually favorable AD&D experience. Swift noted that a past conservative pricing view on mortality suppressed some life sales but he is now optimistic about returning to growth.

Elyse Greenspan of Wells Fargo asked about current loss trend assumptions across the commercial lines book and whether any changes were made in Q1. She also inquired if the company has decided to take price to offset potential tariff impacts in Personal Lines.

Answer

CEO Christopher Swift confirmed no changes were made to loss trend assumptions in Q1, stating the adjustments made in 2024 remain appropriate and that achieved pricing is ahead of loss cost trends. Regarding tariffs, Swift clarified that while their prudent loss picks provide a buffer, the ultimate goal is to earn an adequate return, so if other options are exhausted, they will "go back in and tweak rates."

Elyse Greenspan asked for a breakdown of the drivers behind the 3.3-point increase in the disability loss ratio, specifically the impact from paid family and medical leave versus higher LTD incidents. She also questioned if the 2025 outlook for a flat commercial lines underlying combined ratio accounts for the potential normalization of favorable non-cat property results seen in 2024.

Answer

CEO Christopher Swift explained the disability loss ratio increase was driven by a 3-point impact from elevated paid family and medical leave (PFML) trends and a 1-point impact from higher long-term disability (LTD) incidence, partially offset by a 1-point benefit from better claim recoveries. Regarding the 2025 outlook, Swift reiterated his confidence in delivering a commercial underlying combined ratio consistent with 2024's 87.9% but declined to provide a detailed reconciliation by line, stating the total result would incorporate all such moving parts.

Elyse Greenspan from Wells Fargo asked about the slight slowdown in Middle & Large Commercial premium growth and its expected future trend. She also returned to the topic of general liability, asking about the severity assumptions used and the buffer included to prevent future adverse development.

Answer

CEO Christopher Swift attributed the growth moderation to a difficult prior-year comparison and expressed confidence in future growth, citing strong submission flows and benefits from carrier consolidation. On GL, Swift declined to discuss specific buffers but noted the recent reserve action was a reaction to higher attorney representation and settlement values. CFO Beth Bombara added that these trends have been incorporated into the current year loss pick.

Elyse Greenspan inquired about Aon's capital allocation plans for the $7 billion available capital in 2026, specifically asking if the company has line of sight on deals for the first half of the year given the $1 billion buyback expectation. She also asked for more color on the data center opportunity, its contribution to Q4 organic growth, and the expected tailwind for organic growth in 2026.

Answer

CFO Edmund Reese clarified the 'at least $1 billion' buyback, emphasizing strategic flexibility for a robust pipeline of opportunities that must meet specific criteria, and reiterated Aon's historical balance of inorganic growth investments and capital returns. CEO Greg Case reinforced the commitment to maximizing shareholder returns, citing the NFP Wealth divestiture as proof of disciplined capital allocation. On data centers, Greg Case described the opportunity as unique and monumental, requiring net new innovation and alternative capital forms, with Aon being incredibly well-positioned. He noted it's still the 'beginning of this process' and serves as another proof point for Aon's innovation and ability to drive mid-single-digit or greater organic revenue growth. Edmund Reese added that data center contributions are reflected in the Commercial Risk business, which saw 6% growth for the year and double-digit growth in construction, supporting confidence in 2026 organic growth.

Elyse Greenspan asked about Aon's plans for deploying its $7 billion available capital in 2026, specifically regarding the $1 billion share buyback and potential M&A timing, and sought more detail on the data center opportunity's contribution to Q4 organic growth and its expected tailwind for 2026.

Answer

CFO Edmund Reese clarified the 'at least $1 billion' buyback provides strategic flexibility for a robust M&A pipeline, emphasizing a balanced capital allocation approach. President and CEO Greg Case described the data center opportunity as monumental and unique, driven by net new innovation, while Edmund Reese noted its double-digit growth contribution within the commercial risk business in Q4, reinforcing confidence in mid-single-digit organic growth.

Elyse Greenspan of Wells Fargo & Company inquired about the diversification and margin profile of the M&A transactional business, and also asked for the specific drivers of the strong Q2 free cash flow growth.

Answer

CEO Greg Case explained that Aon's M&A services capability is broad-based, having expanded geographically and beyond private equity to the corporate world. CFO Edmund Reese added that the key focus is on margin expansion across all segments driven by operating leverage from Aon Business Services (ABS). On free cash flow, Reese attributed the 59% quarterly growth to strong operating income (including NFP), working capital improvements, and lower NFP transaction costs, confirming confidence in the full-year growth target.

Elyse Greenspan of Wells Fargo & Company asked for details on Aon's M&A transactional book, including its geographical diversification and margin profile, and questioned the drivers behind the strong quarterly free cash flow growth.

Answer

CEO Greg Case stated that Aon's M&A services capability is broad-based geographically and has expanded beyond private equity to corporate clients. CFO Edmund Reese confirmed the growth was seen across all regions and that margins are expanding across all solution lines due to operating leverage from Aon Business Services (ABS). He attributed the strong free cash flow to operating income growth, working capital improvements, and lower NFP transaction costs.

Elyse Greenspan asked for quantification of the negative impact from a multiyear reinsurance extension in Q1 and sought clarity on the Reinsurance segment's outlook for the rest of the year. She also questioned the drivers of the full-year double-digit free cash flow growth guidance, asking to confirm the 2024 baseline and understand any seasonality.

Answer

CEO Gregory Case described the reinsurance deal as a unique, high-value-creation event for a major client that affected Q1 timing but not the segment's strong underlying momentum. CFO Edmund Reese confirmed the impact would not repeat and expects the Reinsurance segment to meet its mid-single-digit or greater guidance for the full year, with a strong second half. Mr. Reese also confirmed the double-digit free cash flow growth is off the 2024 reported base, driven by NFP and core performance, noting that Q1 is seasonally the lowest cash flow quarter.

Elyse Greenspan asked about the Q1 outlook for Commercial Risk given an easier comp, whether the guided NFP M&A EBITDA is included in 2025 guidance, and if share repurchases might increase in 2026 after deleveraging.

Answer

CFO Edmund Reese stated there is no unusual seasonality for Q1 beyond guided FX and fiduciary income impacts, and confirmed the NFP M&A EBITDA is in the 2025 forecast. On buybacks, Reese noted the 2025 focus is deleveraging but deferred specific 2026 capital return guidance, emphasizing a continued balanced approach.

Elyse Greenspan questioned the current state of the M&A and SPAC advisory business compared to peak levels and asked for insight into the positive and negative factors influencing the 2025 tax rate outlook.

Answer

CEO Gregory Case addressed the M&A business, noting that while activity is still below the 10-year average, it is improving and represents a significant future opportunity due to substantial available capital. CFO Edmund Reese discussed the tax rate, explaining that variability is driven by geographic profit mix and global policy changes. He deferred specific 2025 guidance to the year-end call but noted the Q3 YoY comparison was affected by a prior-year discrete item.

Elyse Greenspan asked about the long-term outlook for margin expansion beyond 2026, specifically if the expectation of 50 basis points of underlying expansion with 4%+ organic growth remains. She also sought clarification on the magnitude of negative impact from life sales and deferred revenue assumption changes in Q4 and if they will continue to be backed out.

Answer

CFO Doug Howell confirmed that the expectation of 50 basis points of underlying margin expansion with 4%+ organic growth holds true beyond 2026, with additional synergies from the AssuredPartners acquisition expected through 2027. He clarified that life sales were -1% and deferred revenue changes were -2% in Q4, within guidance, emphasizing these are quarterly fluctuations and not significant on an annual basis. The new reporting aims to highlight underlying organic growth by excluding this quarterly noise.

Elyse Greenspan from BMO Capital Markets asked about the outlook for margin expansion beyond 2026, specifically if the expectation of 4% organic growth leading to 50 basis points of underlying margin expansion still holds. She also inquired about the impact of deferred revenue assumption changes on organic growth, noting a negative 3% impact in Q4 and net breakeven in other quarters.

Answer

Doug Howell (CFO) confirmed that the expectation of margin expansion starting at 4% organic growth, leading to 50 basis points of underlying expansion, still holds. He noted that 2026 will have noise from lost interest income but will benefit from AssuredPartners synergies, with an additional $100-$120 million in cost savings expected through 2027. Regarding deferred revenue, he explained the Q4 impact was within estimates and that on a full-year basis, the impact is minor, suggesting it's a quarterly noise issue rather than an annual one.

Elyse Greenspan asked about the accounting for AssuredPartners' new business and synergies, the organic growth outlook for 2026, and how the AssuredPartners acquisition impacts Gallagher's M&A pipeline.

Answer

CFO Douglas K. Howell explained that revenue synergies from AssuredPartners go into their P&Ls, while broader contingent commissions impacting Gallagher's books would be legacy organic growth. He stated that the 2026 organic outlook could look similar to 2025 (above 6%). Chairman and CEO J. Patrick Gallagher, Jr. added that the AssuredPartners pipeline is not yet integrated, but the acquisition has opened up M&A opportunities with smaller agencies, though integration will take time.

Elyse Greenspan of Wells Fargo inquired about the specific timing of the HSR information submission to the DOJ for the Assured Partners acquisition and the details of the back-half brokerage organic growth outlook, including pricing assumptions and the status of previously delayed benefits business.

Answer

CEO J. Patrick Gallagher declined to provide specific dates regarding the DOJ review but reiterated confidence in a Q3 closing. CFO Douglas K. Howell confirmed the back-half organic outlook is in the "five plus" percent range, which accounts for current pricing trends, potential variability in large life insurance cases, and a timing headwind from a strong Q1.

Elyse Greenspan of Wells Fargo inquired about the specific timing of the HSR filing for the Assured Partners acquisition and the assumptions underlying the 5%+ brokerage organic growth outlook for the second half of 2025, particularly regarding property pricing and benefits business.

Answer

CEO J. Patrick Gallagher declined to provide specific dates on the DOJ review but affirmed confidence in a Q3 close. CFO Douglas K. Howell explained the 5%+ back-half outlook is based on current property and casualty trends, noting potential variability from large life insurance cases and a headwind from strong Q1 timing.

Elyse Greenspan inquired about the drivers behind the impressive 20% organic growth in the reinsurance segment and sought an update on the timeline for the AssuredPartners acquisition, including the process with the Department of Justice.

Answer

J. Gallagher, an executive, detailed that the reinsurance growth was driven by new business wins (over half the organic growth), increased renewal premiums, and some favorable timing. Douglas Howell, CFO, explained they are working on the DOJ's second request for the AssuredPartners deal and expect to submit it in the mid-third quarter, which will then start a 30-day review clock.

Elyse Greenspan from Wells Fargo sought confirmation on the components of the 6-8% Brokerage organic growth outlook for 2025, asking for more detail by business line. She also inquired about the M&A pipeline and whether deal activity would accelerate post-closing of the AssuredPartners acquisition, given the minimal pipeline overlap.

Answer

CFO Douglas Howell confirmed prior commentary on the drivers of the brokerage outlook. CEO J. Gallagher addressed the M&A pipeline, stating that AssuredPartners has a strong, accretive pipeline of tuck-in deals with very little overlap with Gallagher's. He anticipates a substantial increase in the number of smaller deals post-close, as AssuredPartners is strong in geographies where Gallagher is not present. Mr. Howell also confirmed the greenshoe proceeds are extra cash for the pipeline.

Elyse Greenspan asked about the potential impact of recent storms on Q4 contingent commissions, assumptions for the benefits business in 2025, the M&A outlook amid a potential slowdown and election year, and a clarification on a corporate segment FX charge.

Answer

CFO Douglas Howell stated storm impacts on contingents would be minimal, around 10 basis points. For 2025, he suggested benefits organic could be around 5%. Executive J. Gallagher described the M&A pipeline as one of the best ever, despite a general market slowdown, and noted an election outcome could spur activity. Howell added that the FX charge reversed in October but they did not update the Q4 guide for the small amount.

Elyse Greenspan asked if the retail organic growth guidance, projecting modest improvement over 2.8% in 2025, already adjusts for the impact of the Howden departures. She also inquired about the impact of the government shutdown on both retail and specialty distribution in the fourth quarter and any expected impact in Q1 or 2026.

Answer

J. Powell Brown, CEO, confirmed that the retail organic growth guidance does adjust out the impact of the departures. R. Andrew Watts, CFO, stated there was no material impact from the government shutdown in Q4, particularly in the flood business, as the company is adept at managing through such events, with any delays typically resolved within 30-60 days, and no major impact is expected in Q1 or 2026.

Elyse Greenspan asked if the Retail organic growth guidance for 2026, anticipating modest improvement over 2.8% in 2025, already adjusts for the impact of the Howden departures. She also inquired about the impact of the government shutdown on both Retail and Specialty Distribution in Q4 and expectations for Q1/2026.

Answer

J. Powell Brown, President and Chief Executive Officer, confirmed that the Retail organic growth guidance for 2026 does adjust out the impact of the Howden departures. R. Andrew Watts, Chief Financial Officer, stated that there was no material impact from the government shutdown in Q4, particularly in the flood business, as the company is adept at managing through such events, with any delays typically caught up within 30-60 days.

Elyse Greenspan requested clarification on the retail segment's Q4 organic growth guidance, specifically whether it is stable with the reported 2.7% or the adjusted 3.7% (after accounting for incentive comp impact).

Answer

Andrew Watts, CFO, clarified that the Q4 retail organic growth outlook is stable with the *as reported* 2.7%. This considers carryover headwinds from incentive accruals and a lower volume of multi-year policies compared to Q4 of the prior year.

Elyse Greenspan sought confirmation that the AssuredPartners deal's revenue, synergies, and accretion are in line with prior expectations, with synergies starting next year, and clarification on whether the Q4 retail organic growth guide is stable with the reported 2.7% or the adjusted 3.7%.

Answer

CFO Andrew Watts confirmed that all aspects of the AssuredPartners deal, including revenues, margins (with seasonality), and synergy realization over a three-year period (by end of 2028), are in line with prior communications. He clarified that the Q4 retail organic growth outlook is stable with the *as reported* 2.7%, factoring in carryover headwinds from employee benefits incentives and a lower volume of multi-year policies compared to Q4 of the prior year.

Elyse Greenspan from Wells Fargo followed up on the Retail segment's performance, asking how the full-year outlook is affected by the Q2 slowdown and if the deceleration worsened through the quarter.

Answer

President, CEO & Director J. Powell Brown advised that analysts should factor the ongoing downward pressure on rates into their Q3 and Q4 organic growth models. EVP, CFO & Treasurer R. Andrew Watts confirmed that the rate slowdown did intensify in June compared to April and May.

Elyse Greenspan asked for an updated full-year margin outlook following the Q1 results and for commentary on the full-year retail organic growth forecast, given current economic uncertainties.

Answer

Executive J. Powell Brown confirmed the full-year margin outlook has not changed from the previous quarter's guidance, with Q1 performance meeting expectations. Regarding retail growth, Brown reiterated the company's long-term view of low-to-mid-single-digit organic growth and expressed satisfaction with the Q1 results, which he described as a return to more traditional growth levels. Executive R. Watts added that the company has not seen buyers materially change their investment levels, supporting their stable outlook.

Elyse Greenspan of Wells Fargo sought clarity on the Retail segment's Q1 2025 organic growth outlook, considering a stated 100 bps headwind. She also asked about margin headwinds in the Programs segment and a negative EBITDA figure in the Corporate segment.

Answer

J. Powell Brown, an executive, reiterated that Retail is a low- to mid-single-digit organic growth business and confirmed the 100 bps Q1 headwind is a timing issue, not a change in the annual outlook. R. Watts, an executive, explained the full-year flat margin guidance is for the total company and accounts for headwinds from lower investment income and contingents. He attributed the Q4 negative corporate EBITDA to non-recurring, one-off costs.

Elyse Greenspan asked for confirmation that incentive commissions are included in organic growth, inquired if an adjusted 5% growth is a proper baseline for the Retail segment, and asked about the drivers of the Q3 increase in investment income.

Answer

R. Watts, an executive, confirmed incentive commissions are in organic growth and explained the higher Q3 investment income was temporary, driven by holding proceeds from a bond issuance. J. Powell Brown, an executive, later clarified that the Retail segment's Q3 performance, adjusted for one-time items, serves as a 'good starting place' for Q4 expectations.

Elyse Greenspan asked about the premium growth outlook for 2026, considering the fourth quarter 2025 performance and a potentially reduced need for aggressive rate increases. She also inquired about the expense ratio guidance for 2026, specifically regarding AI and technology investments and their expected returns.

Answer

CEO Rob Berkley indicated that insurance activities (primary and excess) are likely to perform better than the fourth quarter, while the reinsurance market may become more challenging. He confirmed significant investments in technology and AI for 2026 and 2027, with benefits expected to scale from 2027 onwards. CFO Rich Baio noted a 30 basis point non-recurring benefit for commission-related accruals in Q4 2025.

Elyse Greenspan inquired about W. R. Berkley's premium growth outlook for 2026, considering recent market dynamics and the company's stance on pricing, and also asked about the expected timeline for returns on AI and technology investments.

Answer

CEO Rob Berkley indicated that insurance activities (primary and excess) are likely to perform better than Q4 2025, while the reinsurance market might face challenges. He confirmed that significant investments in AI and technology would continue through 2026 and 2027, with benefits expected to scale from 2027 onwards.

Elyse Greenspan asked for an update on Mitsumi Sumitomo's regulatory filing regarding a 5% stake in the company. She also questioned if stable rate pricing and slowed growth in commercial auto and other liability indicate a shift to a lighter growth environment.

Answer

Rob Berkley, President and CEO, confirmed that a 5% stake typically requires a filing but stated the company has no additional information. He explained that major market segments are in transition, making growth prediction difficult, and reiterated that underwriting and rate integrity would not be compromised for top-line growth.

Elyse Greenspan asked about Mitsui Sumitomo's potential 5% stake and regulatory filing requirements. She also questioned if stable rate pricing and slower growth indicate a lighter growth world for W. R. Berkley.

Answer

Rob Berkley (President and CEO) confirmed his understanding that Mitsui Sumitomo would need to file with the SEC upon reaching a 5% stake, but W. R. Berkley has no additional information. He acknowledged that growth might be lighter due to market transitions, emphasizing the company's commitment to underwriting and rate integrity over top-line growth, focusing on risk-adjusted returns.

Elyse Greenspan of Wells Fargo questioned the decision to not repurchase shares during the quarter and asked for color on the minor prior period reserve development.

Answer

President & CEO W. Robert Berkley, Jr. explained that the company chose a special dividend as the most efficient method for capital return this quarter but emphasized that share repurchases remain an active tool. He described the reserve movements as minor adjustments from their regular granular review with nothing particularly noteworthy.

Elyse Greenspan from Wells Fargo questioned the absence of share repurchases during the quarter and sought details on prior-period reserve development within the insurance segment.

Answer

President & CEO W. Robert Berkley, Jr. explained that a special dividend was chosen as the most efficient method for capital return in the quarter but affirmed that share repurchases remain an active tool. He characterized the modest adverse development in insurance as minor and not noteworthy.

Elyse Greenspan asked for a breakdown of the prior year reserve development between the Insurance and Reinsurance segments. She also sought clarification on the drivers of the underlying loss ratio increase in the Insurance segment and requested an update on the regulatory status of Mitsui Sumitomo's investment.

Answer

Principal Financial Officer Richard Baio provided the reserve development figures, stating it was $11 million unfavorable for the Insurance segment and $12 million favorable for the Reinsurance & Monoline Excess segment. He attributed the underlying loss ratio increase to business mix and the impact of outward reinsurance purchasing at the operating unit level. Executive W. Berkley commented that the Mitsui Sumitomo regulatory process is a matter for them to address, and it does not preclude W.R. Berkley from its own share repurchases.

Elyse Greenspan of Wells Fargo & Company requested the reserve breakdown by segment for the quarter and asked for color on any notable short or long-tail reserve trends. She also questioned the outlook for top-line growth in 2025, particularly given the cautious stance on casualty reinsurance.

Answer

W. Robert Berkley, Jr. (Executive) deferred the specific reserve breakdown numbers to a follow-up call but highlighted that the company is paying close attention to auto liability and excess/umbrella lines, while workers' compensation continues to perform well. Regarding 2025 growth, he stated a belief that the organization has an opportunity to grow in the double digits, though it could range from 9% to 16%, driven by achieving rate increases in excess of exposure growth.

Elyse Greenspan of Wells Fargo Securities inquired about prior year reserve development between the insurance and reinsurance segments, the reasons for the slowdown in insurance premium growth ex-workers' comp, and the outlook for returning to 10-15% top-line growth.

Answer

CFO Richard Baio and Executive W. Berkley clarified that reserve development between segments was negligible. W. Berkley attributed the premium growth slowdown to underwriting discipline in the Auto and Excess/Umbrella lines, where the company is waiting for the market to catch up on rate adequacy. He expressed confidence in returning to the 10-15% annual growth target, citing encouraging market trends in October.

Elyse Greenspan questioned why Accelerant's projected EBITDA growth for next year (16%, excluding one-time gains) was lower than the expected gross premiums written growth (20%). She also sought clarification on the 'medium-term' definition for two-thirds third-party portfolio and Hadron's expected contribution within that timeframe.

Answer

Jay Green, Accelerant's CFO, stated that while EBITDA growth might be slightly lower than premium growth, the company expects to maintain strong margins. Ryan Schiller, Head of Strategy, added that the shift to third-party insurers maximizes fee-based revenue in exchange services and MGA operations, which doesn't flow through Accelerant's underwriting revenue. Jeff Radke, Co-founder and CEO, defined 'medium term' as three to five years and projected Hadron's contribution to third-party direct written premium to gently drift down from 33% in Q4 2026 as more third-party insurers are added.

Elyse Greenspan from Wells Fargo questioned why Accelerant's projected EBITDA growth of 16% for next year is expected to be lower than the 20% premium growth. She also sought clarification on the "medium term" for achieving two-thirds third-party portfolio and Hadron's expected contribution within that timeframe.

Answer

Jeff Radke, Accelerant's Co-founder and CEO, and Ryan Schiller, Accelerant's Head of Strategy, clarified that the EBITDA growth moderation is due to a mix shift towards fee-based exchange services and MGA operations as more business moves to third-party insurers, which is considered a positive development. Jeff Radke defined the medium term as three to five years and stated that Hadron's percentage of third-party direct written premium is expected to drift gently down from 33% in Q4 2026 as more third-party insurers are added.

Elyse Greenspan with Wells Fargo asked about the competitive environment in Q3 2025 and the forward view for Q4 2025 and 2026, specifically how it impacts growth and the combined ratio. She also asked for an update on the impact of tariffs on loss trends and margins.

Answer

Tricia Griffith, President and CEO, acknowledged a stronger competitive environment but highlighted Progressive's strong Q3 growth. She outlined a strategy to spur growth in 33 states, particularly focusing on 'Robinsons' (multi-car/multi-product households) due to their large addressable market. She stated that tariffs have not had a significant impact yet, expecting low single-digit effects that current margins can absorb.

Elyse Greenspan asked about the competitive environment observed in Q3 and the forward view for Q4 and 2026, specifically how increased competition and Progressive's current rate position influence its growth strategy.

Answer

President and CEO Tricia Griffith acknowledged a stronger competitive environment but highlighted Progressive's proactive rate adjustments. She emphasized a strategic focus on growing the 'Robinson's' market, which represents a significant addressable opportunity. Griffith detailed a 'new business readiness growth' framework, identifying 33 states for growth, and noted that property's calendar year combined ratio is now around 78%. She also stated that tariffs have not significantly impacted loss trends or margins, expecting only low single-digit effects that current margins can absorb.

Elyse Greenspan of Wells Fargo requested a forward view on policies in force (PIF) growth, considering the dynamics of rising new business, declining PLE, rate decreases, and higher ad spend. She also asked for more detail on capital return plans, particularly regarding incremental returns beyond the typical variable dividend.

Answer

Tricia Griffith, CEO, President & Director, expressed continued optimism for growth, highlighting a significant opportunity to expand the 'Robinson' (auto/home bundle) book as the property business is now better positioned. On capital, she reiterated the company's priorities: 1) reinvesting for growth, 2) share buybacks to offset dilution (and opportunistically if the stock is undervalued), and 3) a variable dividend, which the board considers in December.

Elyse Greenspan posed a hypothetical question about tariffs, asking how Progressive would respond in a state with a mid-80s combined ratio if tariffs impacted severity. She also requested color on the monthly cadence of retention amid increased competition.

Answer

CEO Susan Griffith explained that the response to tariffs would be state-specific, considering factors like growth potential alongside profitability, and noted they are proactively engaging with regulators. On retention, she reiterated that while the headline PLE number is impacted by mix shifts and policy rewrites, the underlying PIF growth remains strong, though the competitive shopping environment creates pressure.

Elyse Greenspan asked about the growth outlook for the seasonally slower fourth quarter and for the full year 2025, following a year of record growth.

Answer

CEO Susan Griffith confirmed Progressive will maintain its marketing push in Q4 to capture market share. For 2025, she conveyed a bullish outlook, citing strong new application growth, favorable rate positioning, and the strength of the company's strategic pillars as key drivers for continued opportunity.

Elyse Greenspan from Wells Fargo asked how the recent actions taken with the Long-Term Care (LTC) block, such as assumption changes, position Unum Group for future risk transfer deals, and sought an update on market discussions for additional transactions. She also followed up on Group Disability, inquiring if Q4's benefit ratio could surpass the 62% guidance and for initial thoughts on maintaining a low 60s benefit ratio into 2026.

Answer

CEO Rick McKenney confirmed a constructive market for LTC risk transfer, noting that simplifying assumptions and removing new lives from the block make it easier for counterparties to model, potentially aiding future transactions. CFO Steve Zabel maintained a 62% benefit ratio as a good estimate for Group Disability in Q4, acknowledging potential volatility. McKenney reiterated that a low 60s benefit ratio signifies a highly profitable business.

Elyse Greenspan asked how the actions taken with the Long-Term Care (LTC) block position Unum for potential future risk transfer deals, requesting comments on market discussions and the likelihood of additional transactions. She also followed up on Group Disability, asking if the better Q3 results suggest Q4 could exceed the ~62% benefit ratio guidance and for initial thoughts on maintaining low 60s into 2026.

Answer

President and CEO Rick McKenney stated that the market for LTC risk transfer is constructive, and the recent actions, including simpler assumptions and the removal of new lives, make it easier for counterparties to model, although they are already familiar with the details. He affirmed Unum's commitment to staying active in the market to reduce the block size. Chief Financial Officer Steve Zabel indicated that 62% remains a good estimate for Q4 Group Disability, with normal volatility. Mr. McKenney added that the low 60s benefit ratio represents a very high-returning business, and they are pleased with the year's results.

Sought clarification on the drivers for the updated disability guidance for the second half of the year, the long-term outlook for the disability loss ratio beyond 2025, and an update on discussions for further long-term care (LTC) de-risking transactions.

Answer

The disability guidance of a ~62% benefit ratio is based on stable recoveries and recent claim incidence trends, and they see no operational reason for this to change long-term. On LTC, the company confirmed it remains actively engaged in the market to further reduce exposure, but noted that such transactions are complex and the timing is hard to predict.

Elyse Greenspan questioned why Unum is not increasing its share buyback more aggressively given its capital flexibility, and asked for color on the expected quarterly sales progression for the year.

Answer

CEO Richard McKenney stated that capital deployment priorities include growth and dividends, and that share repurchases will be managed 'dynamically,' with capacity to do more if warranted. On sales, executives Chris Pyne, Tim Arnold, and Mark Till detailed a strong pipeline for group sales, robust growth in voluntary benefits, and positive trends in international markets, supporting the full-year outlook.

Elyse Greenspan questioned the seemingly conservative share buyback guidance given Unum's strong capital position, asking if it was a buffer for M&A. She also asked for more color on the weaker Q4 results in the voluntary benefits segment and the outlook for 2025.

Answer

CEO Rick McKenney described the share repurchase plan as 'dynamic,' allowing flexibility for opportunities like M&A, which would focus on capabilities, distribution, or international growth. CFO Steve Zabel addressed the voluntary benefits results, characterizing the Q4 weakness as non-systemic volatility and stating that quarterly earnings of around $121 million are a reasonable expectation for 2025.

Elyse Greenspan questioned the seemingly conservative share buyback range given strong capital levels and asked for details on the weaker Q4 results in the voluntary benefits segment.

Answer

CEO Rick McKenney stated the wide $500M to $1B buyback range provides flexibility for potential M&A—focused on capabilities, distribution, and international growth—and allows for dynamic capital return, as demonstrated in 2024. CFO Steven Zabel addressed voluntary benefits, acknowledging Q4 volatility but describing it as transitory and not systemic. He affirmed confidence in the segment's earnings power, guiding to a normalized level of around $121 million per quarter in 2025.

On behalf of Elyse Greenspan from Wells Fargo, a representative asked what is driving the confidence in continued robust results for the Group Life business and whether this strength is expected to continue into 2025.

Answer

CFO Steven Zabel attributed the strong Group Life results to favorable incidence trends, which can be volatile. He stated that a 70% benefit ratio remains a decent planning metric for Q4 2024 but deferred providing specific 2025 guidance until the company's Investor Day, noting the block's inherent volatility.

Elyse Greenspan asked for updated thoughts on Globe Life's M&A strategy, given the company's focus on share repurchases and outlined plans for the next year, implying M&A is less likely. She also inquired if the life sales guidance would be more backend-weighted due to agent recruitment efforts and easier comps earlier in the year, seeking clarity on the expected cadence.

Answer

Tom Kalmbach, EVP and CFO, stated that M&A is always considered but not a compulsion, as organic growth is strong. Share repurchases are the primary use of excess cash flow, but M&A opportunities offering better shareholder returns would be pursued. He emphasized M&A focus on protection-oriented products in middle/lower-middle income markets, distribution growth (like Family Heritage acquisition), and operational efficiency. Matthew Darden, Co-CEO, explained that agent count is a leading indicator for sales growth, with a typical 1-2 quarter lag. He noted positive momentum in hires for Liberty National Life (15% up) and American Income Life (17% up) compared to a year ago, boding well for Q4 and Q1 next year. He agreed that comps from prior year quarters should be considered for cadence.

Elyse Greenspan asked for updated thoughts on M&A likelihood versus share repurchases, given the outlined plan for next year. She also inquired if the life sales guidance would be more backend-weighted due to agent recruitment and easier comps, seeking clarity on the cadence.

Answer

CFO Tom Kalmbach stated that M&A is always considered but not a primary focus, as organic growth is strong, and share repurchases are the baseline use of excess cash flow. He emphasized looking for M&A opportunities that improve the core business of protection-oriented products in middle-income markets, similar to the Family Heritage acquisition. Co-CEO Matthew Darden explained that sales growth is a momentum game, with agent count as a leading indicator. He noted strong positive momentum in hires (15% at Liberty, 17% at AIL), which bodes well for Q4 and Q1. He expects a quarter or two lag between agent count growth and sales growth, leading to high single-digit growth for Liberty and mid-single-digit for AIL next year.

Elyse Greenspan from Wells Fargo asked if recent headlines about rising medical trends were impacting Globe Life's business, questioned the sustainability of strong health margins outside of Medicare Supplement, and requested an update on the ongoing DOJ and SEC investigations.

Answer

Executive VP & CFO Thomas Kalmbach distinguished Globe Life's stable Medicare Supplement business from the Medicaid trends affecting others. Co-Chairman & Co-CEO Frank Svoboda affirmed the stability of the supplemental health business. Regarding the investigations, Co-Chairman & Co-CEO J. Matthew Darden stated there have been no new developments or requests from the DOJ or SEC since the beginning of the year.

Elyse Greenspan of Wells Fargo asked if recent medical trend headlines from other insurers like Centene have impacted Globe Life. She also inquired if current health business margins (excluding Med Supp) are at a sustainable run-rate and requested an update on the ongoing DOJ and SEC investigations.

Answer

Executive VP & CFO Thomas Kalmbach stated that the Centene commentary was primarily about Medicaid, a different market from Globe Life's Medicare Supplement business, and noted that supplemental health trends have been stable. Co-Chairman & Co-CEO Frank Svoboda affirmed the stability and attractiveness of the supplemental health business. Regarding the investigations, Co-Chairman & Co-CEO J. Matthew Darden reported no new developments or requests from the DOJ or SEC since the beginning of the year and reiterated that no claims have been asserted against the company.

Elyse Greenspan from Wells Fargo asked about any observed impact from broader medical trends reported by peers, the sustainability of current health business margins, and requested an update on the ongoing DOJ and SEC investigations.

Answer

Executive VP & CFO Thomas Kalmbach noted that peer commentary on medical trends was primarily related to Medicaid, a different market from Globe Life's Medicare Supplement business, and affirmed that supplemental health margins have been stable. Co-Chairman & Co-CEO J. Matthew Darden added that there have been no new developments or requests from the DOJ or SEC since the beginning of the year.

Elyse Greenspan inquired about the expected pace of share buybacks for the remainder of the year following elevated Q1 activity and asked for an update on the company's evaluation of a Bermuda-based capital framework.

Answer

Chief Financial Officer Thomas Kalmbach indicated that while buybacks are typically ratable, the company will remain opportunistic and could front-load repurchases in the first half of the year. Regarding the Bermuda framework, he stated that work is ongoing and an update will be provided on the next earnings call.

Elyse Greenspan of Wells Fargo questioned the expected pacing of share buybacks for 2025 and whether M&A is being considered as part of the capital deployment strategy. She also asked for the outlook on health utilization.

Answer

CFO Thomas Kalmbach indicated that share repurchases would resume and be generally ratable throughout the year. Co-CEO Frank Svoboda confirmed that the company remains open to M&A opportunities that expand its offerings to middle-income consumers. Kalmbach also stated that they expect health utilization to remain high in 2025, outpacing premium rate increases and impacting the health underwriting margin.

Elyse Greenspan from Wells Fargo inquired about the potential for resuming M&A activity, the expected timing for restarting share buybacks in 2025, the company's exposure to floating-rate investments, and plans for investing in alternative assets next year.

Answer

Co-CEO James Darden stated that Globe Life remains selective on M&A, focusing on properties with exclusive distribution in their target middle-income market. Co-CEO Frank Svoboda anticipates buybacks will restart in Q1 2025. Svoboda also noted that most commercial mortgage loans and limited partnerships are floating-rate, and the company plans to invest roughly 25-30% of its targeted $1.5 billion in 2025 acquisitions into these assets. CFO Thomas Kalmbach added that floating-rate debt provides a natural hedge.

Elyse Greenspan asked if Ategrity's Q4 guidance of growing 20% above the industry is a sustainable long-term target, sought guidance on modeling future fee income contribution, and inquired about any unusual factors within the loss ratio for the quarter.

Answer

Justin Cohen (CEO) affirmed that taking market share is a core strategy, citing a large runway and proprietary initiatives, but declined 2026 guidance. He explained fee income is variable, guiding to $1.5 million for Q4 with associated third-party expenses, and attributed loss ratio dynamics to conservatism in property reserving for potential late claims.

Elyse Greenspan of Wells Fargo questioned the sustainability of Ategrity's outsized growth relative to the E&S market, the future modeling of fee income, and any specific call-outs within the quarter's loss ratio.

Answer

CEO Justin Cohen declined 2026 guidance but affirmed the strategy of taking market share through proprietary initiatives. He guided Q4 fee income to $1.5 million, clarifying its variability and associated expenses. Cohen also explained the loss ratio reflected conservatism in property, booking higher losses despite lower claims due to public company practices, and that favorable development is an actuarial process.

Elyse Greenspan requested a breakdown of the second-half growth guidance by property and casualty, asked about any pricing changes in July versus Q2, and sought color on the increase in the paid-to-incurred ratio.

Answer

CEO Justin Cohen declined to break down guidance by product line but noted optimism for property as prior rate increases annualize. He confirmed no material pricing changes in July. Regarding the paid-to-incurred ratio, Cohen stated the increase was expected and driven by the natural maturation of the growing casualty book and prior-period business mix.

Elyse Greenspan asked about the stability of the Business Insurance underlying loss ratio year-over-year in Q3, specific pushes and pulls, and the outlook given slowing pricing. She also inquired about any impact of tariffs on Personal Auto margins in Q3 and potential future impacts.

Answer

Dan Frey, EVP and CFO, emphasized the spectacular margins in Business Insurance and declined to parse out detailed outlooks for margins, stating they like the business being put on the books. Michael Klein, EVP and President of Personal Insurance, noted a small, non-significant impact from tariffs in Q3 Personal Auto results, well below previous forecasts, but acknowledged the potential for the impact to grow if tariffs remain in effect.

Elyse Greenspan of Wells Fargo asked how the capital from the Canadian sale, beyond the earmarked buyback, would be used and requested an update on M&A views. She also questioned if there were any considerations from OBB legislation or Medicaid changes impacting medical inflation.

Answer

CEO Alan Schnitzer stated the remaining capital will be reallocated to support business growth and other objectives, and it does not change their M&A strategy. He also said they see no meaningful impact from Medicaid-related issues on workers' comp. Greg Tislowski, President of Business Insurance, added that a recent Medicare fee schedule change was within expectations.

Elyse Greenspan asked about the use of capital from the Canadian sale beyond share buybacks and sought an update on the company's M&A outlook. She also questioned if OBB legislation or Medicaid changes were impacting medical inflation.

Answer

Chairman and CEO Alan Schnitzer said the remaining capital will be reallocated to support business growth and other objectives, with no change to their M&A strategy. He also stated they see no meaningful impact from Medicaid or OBB on workers' comp. Greg Tislowski, President of Business Insurance, added that a recent Medicare fee schedule change was within expectations.

Elyse Greenspan asked about the deployment of capital from the Canadian sale beyond the announced share buyback and sought an update on the company's M&A appetite. She also questioned if there were any impacts from OBB legislation or Medicaid changes on medical inflation trends.

Answer

CEO Alan Schnitzer stated the remaining capital will be reallocated to support business growth and other objectives, and it does not change their M&A strategy. He also confirmed they see no meaningful impact from Medicaid changes on workers' comp. Greg Tislowski, President of Business Insurance, added that a recent Medicare fee schedule change was within expectations.

Elyse Greenspan of Wells Fargo asked to quantify any one-off items within the underlying combined ratios for Personal Auto and Home. She also followed up on the timing of the expected impact from tariffs on Personal Auto margins.

Answer

Michael Klein, President of Personal Insurance, noted no specific one-offs but reiterated that Q1 is a seasonally strong quarter for Auto and that favorable non-weather frequency benefited Home. Alan Schnitzer, Chairman and CEO, clarified the tariff impact is a one-time severity change, not a trend change, and would likely be seen in the second half of the year rather than Q2.

Elyse Greenspan questioned the change in the year-over-year improvement of the Business Insurance underlying loss ratio from Q3 to Q4. She also asked about market share in California fire zones and the function of the aggregate reinsurance cover.

Answer

CFO Dan Frey emphasized comparing Q4 to the prior Q4, not sequentially, stating the result was a clean jump-off point. CEO Alan Schnitzer noted statewide market share is a blunt tool for estimating exposure. Dan Frey confirmed the CAT treaty is an aggregate cover, meaning the fire loss will count toward the annual retention, potentially triggering recoveries from later events.

Elyse Greenspan sought confirmation that no significant reserving action was taken on general liability and asked if the year-to-date personal auto margin is a sustainable run rate.

Answer

CFO Dan Frey confirmed that Business Insurance prior year development was driven by workers' comp, with other lines having small net favorable movements. Michael Klein, President of Personal Insurance, stated that while the year-to-date auto result indicates the book is rate adequate, he reminded listeners of Q4 seasonality.

Elyse Greenspan followed up on the rebranding of the company to Marsh, asking if it aims to drive incremental revenue by increasing cross-sell, for example, between Marsh and Mercer, given that cross-sells were not historically 'super large'.

Answer

John Doyle, President and CEO of Marsh McLennan, clarified that the rebranding is not about 'getting rid of' legacy brands but building a 'new Marsh' by transitioning brand equity. He stated it's not primarily about cross-selling (which already occurs significantly) but about simplifying the firm's story, showing up more connectedly, and showcasing the breadth of capabilities, talent, data, and analytics to clients who may be unaware. He emphasized it's a multi-year effort aligned with a common purpose and colleague value proposition, aiming to benefit colleagues, clients, and shareholders.

Elyse Greenspan asked if the company's outlook for 2026 organic revenue growth would likely be similar to the mid-single-digit target for 2025, given the expectation that current market conditions and a slowing economy will persist into the next year. She also inquired about the rebranding of Marsh & McLennan to Marsh and the Thrive program, specifically asking if these initiatives are intended to drive more cross-selling, particularly between Marsh and Mercer, where cross-sell was historically not super large.

Answer

President and CEO John Doyle stated that 2026 guidance would be provided in 90 days, noting that the 2025 mid-single-digit underlying revenue growth guidance was prudent given anticipated market softening and economic impacts. He mentioned that reinsurance markets for January 1, 2026, are expected to resemble those of 12 months prior. Regarding rebranding, Mr. Doyle clarified that it's not about "getting rid of" legacy brands but building a new Marsh brand to simplify the company's story and showcase its unique capabilities, talent, data, and analytics in a more connected way to clients. He emphasized that it's not primarily a cross-sell program, as cross-selling is already an important part of their current operations, but rather about enhancing visibility and value proposition for all stakeholders.

Elyse Greenspan asked for drivers behind the slowdown in Guy Carpenter's organic growth, including new business trends, and requested details on McGriff's revenue growth and seasonality.

Answer

President and CEO John Doyle and Guy Carpenter CEO Dean Klisura attributed the 5% growth, which followed a strong 8% comp, to headwinds from property cat pricing, but highlighted strong new business, record cat bond issuance, and growth in advisory services. Regarding McGriff, Doyle declined to disclose specific revenue but noted a strong start, while CFO Mark McGivney confirmed Q1 is seasonally the smallest quarter, with Q2 and Q4 being the largest.

Elyse Greenspan questioned the flat margin performance in Q4, which contrasted with prior guidance for stronger second-half improvement, and inquired about the drivers of 4% free cash flow growth in 2024.

Answer

CEO John Doyle expressed satisfaction with the full-year 80 basis point margin expansion, attributing the Q4 result to factors like FX and M&A activity, not a disappointment. He affirmed the outlook for margin expansion in 2025. CFO Mark McGivney added that free cash flow can be volatile but has doubled since 2019 and should track earnings growth over the long term, noting the strong 28% growth in the prior year.

Elyse Greenspan inquired about the financial assumptions for the McGriff acquisition, specifically regarding expected revenue growth and margins. She also asked about growth dynamics in the U.S. and Canada, including any recovery in IPO and M&A-related business.

Answer

President and CEO John Doyle expressed enthusiasm for the McGriff deal but declined to provide specific financial projections beyond stating it would be 'modestly accretive' in year one. He noted that while capital markets activity is improving, it's from a low base. Martin South, CEO of Marsh, added that the U.S. and Canada saw 6% growth, with double-digit growth in capital markets and M&A products, driven by strong performance from MMA and Vector.

Elyse Greenspan of Wells Fargo inquired about Aspen's current excess capital position, the potential for capital returns, and the overall premium growth trajectory given the mixed market conditions.

Answer

Mark Pickering, Group CFO & Treasurer, confirmed Aspen has excess capital and that capital management actions, likely share repurchases or special dividends, will be considered as part of the 2026-2028 planning process. Christian Dunleavy, Group President & CEO of Aspen Bermuda Limited, clarified that he does not anticipate the reinsurance business shrinking and that overall growth is driven by bottom-line profitability rather than top-line targets.

Elyse Greenspan from Wells Fargo asked about Aspen's current excess capital position and the potential timing and form of future capital returns to shareholders. She also sought clarity on the premium growth trajectory for the remainder of 2025 and into 2026, particularly the balance between the Insurance and Reinsurance segments.

Answer

Group CFO Mark Pickering confirmed Aspen holds excess capital, citing a 264% BSCR for 2024, and stated that any future capital returns would be considered after the current three-year planning process and likely take the form of buybacks or special dividends. Christian Dunleavy, Group President & CEO of Aspen Bermuda, clarified that he does not expect the Reinsurance segment to shrink, attributing recent premium fluctuations to client-side adjustments rather than a change in Aspen's underwriting appetite.

Elyse Greenspan of Wells Fargo asked about Aspen's current excess capital position and the potential timing for capital returns to shareholders. She also sought clarity on the future premium growth trajectory, questioning whether insurance would drive growth while reinsurance continues to see declines.

Answer

Group CFO Mark Pickering noted that Aspen has excess capital, with a BSCR of 264%, and that capital management decisions will be considered as part of the upcoming three-year planning process, with any returns likely via buybacks or special dividends. Christian Dunleavy, Group President & CEO of Aspen Bermuda, clarified that he does not anticipate the reinsurance segment shrinking, attributing recent GAAP premium changes to client-level adjustments rather than a strategic pullback.

Elyse Greenspan of Wells Fargo asked about Aspen's current excess capital position and the conditions under which the company would consider returning capital to shareholders. She also sought clarity on the future premium growth trajectory between the insurance and reinsurance segments.

Answer

Mark Pickering, Group CFO & Treasurer, noted that Aspen has excess capital, referencing a 264% BSCR for 2024, and stated that capital management actions would be considered during the upcoming three-year planning process, likely via share repurchases or special dividends. Christian Dunleavy, Group President & CEO of Aspen Bermuda Limited, clarified that he does not anticipate the reinsurance segment shrinking, explaining that recent premium figures were affected by client-side adjustments rather than a strategic pullback by Aspen.

Elyse Greenspan asked for updated thoughts on a potential transaction for MetLife's long-term care (LTC) block and whether adverse trends seen at health insurers were impacting MetLife's supplemental health business.

Answer

Ramy Tadros, Regional President - U.S. Business, stated that while MetLife is monitoring the active LTC transaction market, any deal must maximize shareholder value, and in the interim, the block is well-capitalized and performing as expected. He also clarified that MetLife's supplemental health business is not seeing the same adverse trends as major medical insurers because its products have fixed-dollar claims and are not showing unusual incidence patterns.

Elyse Greenspan of Wells Fargo inquired about MetLife's latest perspective on a potential transaction for its Long-Term Care (LTC) block, given recent market activity. She also asked if adverse trends seen at health insurers were impacting MetLife's supplemental health business.

Answer

Ramy Tadros, Regional President - U.S. Business, acknowledged the increased activity in the LTC reinsurance market but emphasized that any deal must maximize shareholder value, with price and structure being key. He also stated that MetLife is not seeing the same trends as major medical insurers in its supplemental health business, noting its products are fixed-dollar and that key areas like critical illness are performing in line with expectations.

Elyse Greenspan of Wells Fargo asked for the 2024 earnings contribution from MetLife Investment Management (MIM) and its expected 2025 growth. She also inquired about the potential for upside or downside risk to international earnings from currency movements relative to the company's guidance.

Answer

CFO John McCallion deferred providing a specific MIM earnings figure to avoid confusion, stating the segment breakout will occur with the closing of the PineBridge acquisition in H2 2025. He confirmed the guidance uses forward currency curves from year-end, which imply headwinds for 2025, particularly from the Japanese yen and Latin American currencies. Any deviation from these forward curves would present upside or downside risk.

Elyse Greenspan of Wells Fargo inquired about Voya's Stop Loss business, seeking details on the improved 2024 loss ratio, the outlook for the 2025 block, and the timeline for returning to target margins. She also asked about capital deployment plans, specifically regarding the 2026 OneAmerica earn-out and its potential impact on share repurchases.

Answer

EVP & CFO Michael Katz attributed the lower 2024 Stop Loss ratio of 91% to favorable claims experience but noted it's too early to assess the 2025 block, for which Voya maintains a prudent reserving posture. He affirmed the goal is a two-step process to restore target margins. On capital, Katz confirmed plans for $200 million in H2 2025 buybacks and stated Voya is well-positioned for the 2026 OneAmerica payment. CEO & Director Heather Lavallee added that Voya will maintain a balanced capital approach, seeing attractive investment opportunities in wealth management, retirement roll-ups, and automation.

Elyse Greenspan of Wells Fargo inquired if Q1 results altered the full-year earnings outlook and asked for more color on the improved Stop Loss loss ratio and the timeline for returning to target margins.

Answer

CFO Michael Katz indicated the prior outlook is still a good starting point but requires adjustments for macro factors. He noted the Stop Loss reserve release was positive but highlighted other variables like expense seasonality and strong commercial momentum. Katz explained the 2024 Stop Loss loss ratio was reduced simply due to better-than-expected claims experience. He reaffirmed that while pricing is already at target levels, achieving target reported margins remains a two-step process expected to materialize through 2026.

Elyse Greenspan asked for the key drivers behind the 2025 ROE guidance reduction to 12-13% from 14-16% and whether the prior range is achievable in 2026. She also inquired about the timing of share buybacks in 2025.

Answer

CFO Michael Katz confirmed the ROE change was driven by investments in leave management, lower spread income, and reduced prepayment income expectations. He stated that adjusting for growth investments would place the ROE above 13% and affirmed the goal is to return to the 14-16% range in 2026, supported by growing free cash flow. He noted share repurchases will be weighted to the second half of 2025 due to first-half investments in OneAmerica, Sconset Re, and leave management. CEO Heather Lavallee added that Voya remains committed to a balanced capital allocation strategy.

Elyse Greenspan from Wells Fargo sought to clarify the EPS growth trajectory, suggesting an acceleration in the second half of 2025 that would still fall short of the annual target, with a return to the 12-15% range in 2026.

Answer

CFO Robin Raju affirmed this view, stating that EPS growth will improve in the second half due to market recovery, reduced mortality exposure, and incremental buybacks. He expressed confidence in returning to the 12-15% target in 2026, noting that the company has levers like expense and investment actions to support this goal.

Elyse Greenspan of Wells Fargo sought details on the 2025 outlook for the Protection Solutions segment and an update on the BlackRock LifePath Paycheck product.

Answer

CFO Robin Raju confirmed guidance for Protection Solutions is at the lower end of the $200M-$300M range due to inherent volatility and that a strategic update is coming in H1 2025. Nicholas Lane, President of Equitable Financial, projected 2025 inflows from the BlackRock product would be similar to 2024's $600M, noting this represents upside to their long-term targets.

Elyse Greenspan of Wells Fargo asked about the outlook for Aflac Japan's expense ratio for the remainder of the year and questioned the strategy and timing for deploying the elevated cash balance at the holding company.

Answer

An Aflac executive stated that the Japan expense ratio is expected to remain within the 20-23% guidance range for the year, likely at the middle or lower end. Regarding capital, the executive explained there is no rush to deploy the cash, as the recent yen debt issuance was a strategic move to pre-fund maturities and provides a positive carry. Capital deployment will continue to be tactical, seeking the best risk-adjusted returns.

Elyse Greenspan asked about the expense ratio trend in Japan, which has been favorable relative to guidance, and inquired about the plan for the elevated cash at the holding company, including the outlook for share buybacks in the second half of the year.

Answer

An unnamed executive confirmed they expect to remain within the 20-23% expense ratio guidance for Japan, likely in the middle or lower end of that range for the full year. Regarding capital, the executive explained that the current flat yield curve reduces the urgency to deploy cash. The recent yen-denominated debt issuance was intentional to pre-fund maturities and create a positive carry, and future deployment will continue to be a tactical decision based on opportunities with the best IRRs.

Elyse Greenspan asked if the $750 million share buyback in Q4 is a sustainable run rate for 2025 and inquired about any sales impact from a data sharing issue at Japan Post.

Answer

CFO Max Broden characterized capital deployment as opportunistic and IRR-driven, prioritizing organic growth first and declining to commit to a specific buyback run rate. Masatoshi Koide of Aflac Japan confirmed the Japan Post issue was not related to Aflac's products and had no impact on its cancer insurance sales, noting the relationship remains strong.

Elyse Greenspan of Wells Fargo inquired about the unfavorable health experience, the future performance outlook for that block, and the expected impact of rate increases. She also asked how future transactions might receive incremental value of in-force credit.

Answer

EVP & Global Chief Risk Officer Jonathan Porter specified the issue was in the healthcare access line, driven by higher treatment costs, and that significant rate increases are underway with the block expected to be repriced by January 2026. EVP & CFO Axel André added that RGA has a long-standing process with rating agencies to gain VIF credit on new and existing blocks of business.

Elyse Greenspan inquired about the current pipeline for in-force transactions and the outlook for the Pension Risk Transfer (PRT) market, particularly regarding the temporary slowdown mentioned in prepared remarks.

Answer

CEO Tony Cheng described the transaction pipeline as 'attractive' in quality, with robust and broad opportunities across EMEA, Asia, and North America, driven by the company's 'Creation Re' strategy. Regarding PRT, he characterized the current market slowdown as a temporary pause due to macro uncertainty and stated that RGA remains very bullish on the business line, expecting activity to pick up in the second half of the year.

Elyse Greenspan asked about the current pipeline of transactions and opportunities, and the impact of market uncertainty on the PRT market.

Answer

CEO Tony Cheng described the pipeline as attractive, emphasizing quality, long-term partnerships, and strategic fit. He expects the PRT market pause to be temporary and to recover in the second half of the year.

Elyse Greenspan asked about the assumptions for foreign exchange (FX) and future in-force actions embedded in the 2025 earnings guidance. She also questioned if the deal pipeline is robust enough to utilize the deployable capital, or if share buybacks might resume in 2025.

Answer

Chief Financial Officer Axel Philippe Andre explained the guidance assumes year-end FX rates and includes only a modest level of in-force actions, around $50 million. He stated that given the robust deal pipeline, RGA expects to use its deployable capital for transactions, making significant share buybacks unlikely in the foreseeable future. CEO Tony Cheng added that in-force actions are a core part of RGA's strategy.

Elyse Greenspan asked for details on the factors being considered in the upcoming re-evaluation of the excess capital methodology. She also inquired about RGA's Long-Term Care (LTC) exposure, recent experience, and appetite for new transactions.

Answer

CFO Axel Andre explained the re-evaluation will focus on incorporating the value of in-force business margins as a source of capital and recalibrating diversification benefits. President and CEO Tony Cheng and CFO Axel Andre addressed LTC, noting a modest exposure of approximately $4 billion in reserves from newer, well-performing blocks. They affirmed RGA would consider new LTC transactions if the risk-return profile is attractive.

Elyse Greenspan of Wells Fargo asked for an update on the workers' compensation market, particularly in California, and Everest's exposure there. She also sought clarification on the Russia/Ukraine aviation loss, asking what portion of cedents have notified Everest of losses.

Answer

Jim Williamson, President & CEO, noted that California is now a much smaller part of their workers' comp book, as a specialized unit has been run down, and they now only write it as part of a broader portfolio. Regarding the aviation loss, Williamson explained that through direct and ongoing contact with cedents, the company had sufficient information to book a confident loss estimate, regardless of formal notifications.

Elyse Greenspan asked for the industry loss estimate for the Q1 aviation event, whether the ex-aviation attritional loss ratios are a good run-rate, and if Everest's share of the aviation loss was disproportionately high.

Answer

CEO Jim Williamson estimated the industry aviation loss at around $1 billion and stated Everest's loss was consistent with its position as a leading excess of loss reinsurer in a heavily reinsured event. CFO Mark Kociancic advised against using the current attritional loss ratio as a direct run-rate, noting that the favorable mix shift from written premiums will take time to be reflected in earned premiums.

Elyse Greenspan from Wells Fargo asked for a reconciliation of Everest's lower California wildfire loss estimate and questioned the significant difference in loss picks between casualty reinsurance and casualty insurance.

Answer

President and CEO Jim Williamson attributed the lower wildfire loss to superior underwriting and deliberately avoiding heavily impacted deals. Regarding loss picks, he explained the reinsurance portfolio consists of carefully selected, top-quartile clients, whereas the insurance portfolio was historically over-concentrated in certain challenged classes, making the two books entirely different. CFO Mark Kociancic confirmed a consistent 12%+ loss trend assumption is used for key casualty lines in both segments.

Elyse Greenspan of Wells Fargo asked for insight into the improvement trajectory for the Insurance segment's combined ratio from its ~100% starting point and questioned if the 37% casualty non-renewal rate seen in Q3 could increase further.

Answer

Executive Mark Kociancic outlined a clear downward trajectory for the combined ratio, driven by a mix shift to shorter-tail lines, the run-off of underperforming business, and scaling of the international business. Executive James Williamson confirmed that if more than 37% of premiums need to be non-renewed to achieve profitability, they are prepared to do so, as there is ample quality business to write elsewhere.

Elyse Greenspan from Wells Fargo asked for clarification on the insurance premium growth outlook for the second half of the year, questioned whether AXIS would ever re-enter the property cat reinsurance market after a major event, and inquired about any impact from the UK/Russia aviation ruling.

Answer

CFO Peter Vogt confirmed his expectation that insurance premium growth in the second half of the year should be higher than the 6% seen year-to-date. President & CEO Vincent Tizzio stated definitively that the company would not re-enter the property cat reinsurance business, preferring to pursue related opportunities through its insurance segment, particularly E&S. Mr. Vogt also confirmed there was no financial impact from the aviation ruling as AXIS does not participate in the contingent war market.

Elyse Greenspan asked about the upcoming annual reserve review process compared to last year's deep dive, expectations for property pricing following recent hurricanes, and the outlook for premium growth in 2025.

Answer

CFO Pete Vogt confirmed an outside firm will again conduct an independent review, but the process will be less of a deep dive than last year as a highly interactive quarterly review is now standard. President and CEO Vince Tizzio described the property market as dynamic but stated AXIS's portfolio remains highly premium adequate. For 2025, Tizzio said plans are not final but emphasized that profitability will be prioritized over growth, highlighting that new initiatives are already showing strong contributions to the top line.

Elyse Greenspan asked for details on the drivers of the RBC ratio movement beyond the mean reversion change and inquired about the status of strategic actions to increase value, such as flow reinsurance.

Answer

CFO Ed Spehar clarified the mean reversion benefit was about 15 percentage points and noted other positive impacts included normalized statutory earnings and the seasonal release of the C4 capital charge for fixed business. He added that while flow reinsurance is still being considered, the current top priority is simplifying the hedging strategy for the in-force variable annuity and first-generation Shield block.

Elyse Greenspan from Wells Fargo & Company questioned the balance between share buybacks and capital needs for growth, especially with shares below book value. She also asked for an update on the premium growth attributed to the A.M. Best upgrade and sought details on the drivers of the favorable prior-year reserve development.

Answer

CFO Craig Howie stated that despite a modest $10 million buyback in Q1 due to a short trading window, Hamilton has ample capital for both continued growth and share repurchases. CEO Giuseppina Albo confirmed that $40 million in new business was written in Q1 due to the upgrade, keeping them on track for their $80 million full-year target. Craig Howie added that favorable development was mainly from property and specialty claims settling below reserves and a favorable adjustment for Hurricane Ian, with only a minor unfavorable development in casualty.

Elyse Greenspan of Wells Fargo inquired about the company's capital allocation strategy, specifically balancing share buybacks with capital needs for growth, given the stock's valuation below book value. She also asked for the Q1 premium impact from the A.M. Best upgrade and whether the full-year guidance was still on track. Finally, she requested details on the prior-year reserve development, including any offsetting adverse movements and the relevant accident years.

Answer

CFO Craig Howie stated that Hamilton has ample capital for both growth and continued share repurchases, noting the $10 million buyback in Q1 was limited by a short open trading window. CEO Pina Albo confirmed the A.M. Best upgrade drove $40 million in new premium in Q1, predominantly in casualty, making the company comfortable with its previous $80 million full-year guidance. Craig Howie detailed the reserve releases, attributing them mainly to property and specialty claims settling for less than reserved, with only a minor $1 million unfavorable development in casualty. He also mentioned a favorable adjustment for Hurricane Ian (2022) reserves.

Inquired about the run-rate for the international underlying loss ratio and the premium growth trends for the International and Bermuda segments for the full year.

Answer

The full-year 2023 international loss ratio of ~53% is a better run-rate indicator than the current quarter's figure. The company maintains its growth guidance for the International segment despite some quarterly slowdown due to underwriting discipline in areas like cyber, with strong performance from Hamilton Select. Bermuda's growth is expected to remain strong, boosted by the rating upgrade.

Elyse Greenspan of Wells Fargo inquired if the Q3 international underlying loss ratio represents a good run-rate and asked for an outlook on premium growth for the International and Bermuda segments, noting a potential slowdown in International.

Answer

Craig Howie, Group CFO, advised using the full-year 2023 attritional loss ratio of approximately 53% as a better indicator for the International segment, noting the YTD 2024 figure is impacted by the Baltimore bridge loss. Pina Albo, Group CEO, confirmed the Q3 slowdown in International was due to underwriting discipline, particularly in cyber, but maintained expectations for double-digit growth for the full year, supported by strong performance in Hamilton Select. Craig Howie added that Bermuda growth is expected to remain strong.

Elyse Greenspan asked for more detail on the company's top priorities for enhancing capital efficiency and inquired about the pipeline for Pension Risk Transfer (PRT) deals, questioning if market volatility was impacting deal flow.

Answer

CEO Kevin Hogan identified the expansion of their Bermuda reinsurance strategy as a key capital management tool, noting they have ceded $14 billion to date and see further opportunities. He also mentioned that external reinsurance is evaluated based on whether it is accretive on a risk-adjusted basis. Regarding PRT, Hogan stated the pipeline remains robust, especially for full plan terminations, and he does not see current volatility significantly impacting deal timing.

Elyse Greenspan from Wells Fargo requested more detail on the expected increase in Individual Retirement surrender rates in 2025 and sought confirmation on the capital return policy, including the 60-65% payout target and holdco cash levels.

Answer

CEO Kevin Hogan explained that while the volume of policies exiting surrender charge periods will increase due to portfolio growth, the actual surrender rate will depend on market conditions. CFO Elias Habayeb confirmed the 60-65% payout ratio is the baseline for the full year and that the holdco liquidity philosophy remains unchanged, aiming to hold cash for one year of parent needs.

Elyse Greenspan from Wells Fargo inquired about the Pension Risk Transfer (PRT) deal pipeline for the remainder of the year and 2025, and asked when the excess parent company liquidity might be brought down.

Answer

CEO Kevin Hogan confirmed a strong PRT pipeline, noting a decent-sized transaction has already been secured for Q4 and the outlook for 2025 is very attractive. CFO Elias Habayeb stated that parent liquidity remains above the 12-month needs target but is expected to continue trending down over time as one-time separation expenses have concluded.

Elyse Greenspan of Wells Fargo Securities, LLC inquired about the operational and financial impact of Corebridge's new Bermuda reinsurance strategy, including potential capital efficiencies. She also asked for the outlook on fixed annuity sales for the remainder of the year and into the next.

Answer

President and CEO Kevin Hogan described the Bermuda entity as an extension of their capital management toolkit, initially ceding fixed and index annuity new sales to support robust growth and create long-term value. Regarding fixed annuities, Hogan noted that Q2 conditions were exceptionally strong due to customer demand and attractive rates. He emphasized that while such record quarters may not always repeat, the company's responsive pricing and broad distribution position them well to capitalize on supportive market conditions.

Elyse Greenspan sought clarity on the 5-8% EPS growth trajectory given the near-term drag and asked about the capital return policy relative to net income.

Answer

CFO Yanela Frias confirmed the 5-8% EPS growth target is not linear and will be impacted in 2025 by headwinds from Japan surrenders and VA runoff, which are expected to dissipate over time. She clarified that the 65% of net income figure is a free cash flow target, not a direct capital return policy, and is measured over time due to the lumpiness of cash flows.

Elyse Greenspan sought clarity on the expected trajectory of EPS growth in 2025 relative to the 5-8% long-term target, given it's not expected to be linear. She also asked about the potential for additional Prismic reinsurance transactions in Japan.

Answer

CFO Yanela Frias confirmed that growth will not be linear, with near-term headwinds from new business strain and runoff blocks suggesting an upward trajectory over the three-year period. Vice Chairman Rob Falzon affirmed that Prudential has an active pipeline for multiple future reinsurance transactions for Prismic in Japan, covering balance sheet optimization, flow solutions, and third-party blocks.

Elyse Greenspan requested more detail on PGIM's asset flow trends, particularly concerning the institutional and retail channels, and the outlook for the remainder of the year. She also asked about the strong performance in the Group Insurance segment, questioning if there were any one-off items and how the benefits ratio is expected to trend.

Answer

Andy Sullivan, Head of International Businesses and PGIM, explained that PGIM's institutional flows are variable due to derisking by large, overfunded pension clients, but noted flows were positive year-to-date. He added that retail flows have improved significantly and are poised to accelerate. Caroline Feeney, Head of U.S. Businesses, stated the Group Insurance strength was core, driven by favorable mortality, claims management, and diversification. She projected the full-year benefit ratio would be at the lower end of the 83% to 87% target range.

Elyse Greenspan asked for the current excess capital drag on ROE, clarification on the 2025 tax guidance regarding the Bermuda tax, and what might cause the competitive financial lines market to improve.

Answer

CFO Peter Enns estimated the backward-looking excess capital drag at around 2% on ROE and 6% on ROCE. He confirmed the tax guidance is based on current law for 2025-26, with long-term uncertainty remaining. CEO Evan G. Greenberg stated that as losses emerge and renormalize in financial lines, it will serve as an 'ameliorating factor' on competition.

Elyse Greenspan of Wells Fargo requested a specific breakdown of long-tail reserve movements, asked for investment income guidance, and inquired about the directional impact of Bermuda tax changes on the future tax rate.

Answer

Chairman and CEO Evan G. Greenberg declined to provide a detailed breakdown of reserve movements. CFO Peter Enns guided for Q4 recurring investment income to be at the high end of the previous H2 guidance. He deferred any commentary on the 2025 tax rate until the Q4 earnings release, citing ongoing uncertainty.

Elyse Greenspan of Wells Fargo sought clarification on the life insurance assumption review, asking for the rationale behind the minimal changes, and inquired about the company's capital return strategy, specifically the timing of potential share buybacks versus paying down preferred stock.

Answer

CFO Chris Neczypor explained that the annual assumption review was a rigorous process and key assumptions for the life business, including mortality and policyholder behavior, are now in line with experience. Regarding capital return, he reiterated that deleveraging and repaying preferred stock remain priorities, with no new timeline provided for share repurchases.

Elyse Greenspan of Wells Fargo asked for an update on the Pension Risk Transfer (PRT) market and the outlook for 2025. She also inquired about the drivers and outlook for fee rate compression in the RIS segment.

Answer

Executive Christopher Littlefield expressed confidence in hitting the $3 billion PRT sales target for the year at attractive returns and expects to grow sales in 2025. On fee compression, he explained that strong market performance is the primary driver, pressuring the rate by an extra 0.5-1 bp. However, he still expects to end the year within the guided 2-3 bps of compression on a trailing 12-month basis.