DeRidder, LA – AMERISAFE, Inc. (Nasdaq: AMSF) recently announced results for the first quarter ended March 31, 2022.
G. Janelle Frost, President and Chief Executive Officer, noted, “Providing protection for small to mid-sized businesses and care for their injured workers, while returning value to our shareholders is fundamental to our strategy. This quarter our capital management approach included our regular quarterly dividend and share repurchases. I believe the share repurchases, along with our strong operating results, reinforces the confidence we have in our long-term plans and underlying earnings power of our niche business.”
Gross written premiums in the quarter were lower by $3.7 million, or 4.6%, compared with the first quarter of 2021. Voluntary premiums were down 7.6% compared to the first quarter of 2021, driven by loss cost declines in state filings with the average loss cost decline in the first quarter being 8.2%.
Payroll audits and related premium adjustments were $2.5 million higher than the first quarter of 2021. Audits and other adjustments increased premiums written by $2.8 million in the first quarter of 2022, compared to an increase in premiums written of $0.3 million in the first quarter of 2021.
The current accident year loss ratio for the first quarter was 71.0%, one point lower than the 72.0% ratio initially set for accident year 2021. During the quarter, the Company experienced favorable net loss development for prior accident years, which reduced loss and loss adjustment expenses by $10.2 million, primarily from accident years 2019 through 2017. There was no change to the reserve estimate on the catastrophic claim the company experienced in the fourth quarter of 2021.
For the quarter ended March 31, 2022, the underwriting expense ratio was 22.4% compared with 26.8% in the same quarter in 2021. The decrease was due to lower insurance assessments compared with the first quarter of 2021, primarily due to a $3.8 million return of assessments from the Minnesota Workers Compensation Reinsurance Association.
The effective tax rate for the quarter ended March 31, 2022 was 19.1%, higher than 18.3% in the first quarter of 2021 due to higher underwriting pre-tax profits.
Net investment income for the quarter ended March 31, 2022, decreased 7.1% to $6.1 million from $6.6 million in the first quarter of 2021, primarily due to lower investment yields on fixed-income securities.
As of March 31, 2022, the carrying value of AMERISAFE’s investment portfolio, including cash and cash equivalents, was $1.1 billion.
During the first quarter of 2022, the Company repurchased 43,893 shares at an average cost of $46.90 per share for a total of $2.1 million. The remaining outstanding share repurchase authorization is $22.9 million. No additional shares were repurchased from March 31, 2022 through April 25, 2022.
During the first quarter of 2022, the Company paid a regular quarterly cash dividend of $0.31 per share on March 25, 2022 which represented a 6.9% increase in the quarterly dividend compared with 2021. On April 26, 2022 the Company’s Board of Directors declared a quarterly cash dividend of $0.31 per share, payable on June 24, 2022 to shareholders of record as of June 17, 2022.
Book value per share at March 31, 2022 was $20.46, a decrease of 0.8% from $20.62 at December 31, 2021.
The complete results release is available here: AMERISAFE 2022 First Quarter Results