Birmingham, AL – ProAssurance Corporation (NYSE: PRA) recently reported net income of $10.6 million, or $0.20 per diluted share, and operating income of $8.6 million, or $0.16 per diluted share, for the three months ended June 30, 2023.
Management commented: Our second quarter results for 2023 reflect operating income of $8.6 million, largely driven by strong investment returns. Underwriting results reflect the ongoing competition and pressures in losses and premiums in our core business. Net loss ratios improved from the first quarter of the year in both our Specialty P&C and Workers’ Compensation Insurance segments. Compared to last year, favorable reserve development is lower, pushing the combined ratio higher.
“The lines of business in which we operate continue to face challenges, and we are responding in ways that will benefit all of our constituencies over the long-term,” said Ned Rand, President and Chief Executive Officer of ProAssurance. “Our underwriting teams continue their disciplined focus on account selection and pricing, while our claims handling professionals work diligently to manage losses and mitigate the impact of social inflation prevalent in the claims environment.”
New business written was noteworthy this quarter in several of our lines of business. The healthcare professional liability, life sciences, and traditional workers compensation lines all produced new business exceeding expectations in the quarter.
Rand commented, “The new business we wrote across multiple lines is a testament to the hard work our team members have performed in keeping the market aware of the value proposition that ProAssurance offers. We believe that our financial position and reputation for standing with our insureds is attractive in the competitive marketplace.”
Net investment income showed substantial growth this quarter, increasing by 44% to $32 million. This continues a trend of higher investment income as a result of higher interest rates. We expect this trend to continue, as reinvestment rates are now considerably higher than the average book yield of maturing investments. Strong performance from investments in LPs/LLCs also contributed to an increase in book value in the quarter.
Our book value per share at quarter end was $21.24, up 4% from the December 31, 2022 book value of $20.46. Adjusted book value per share, which excludes Accumulated Other Comprehensive Income (AOCI), is $26.31 as of June 30, 2023 as compared to $25.99 as of December 31, 2022. Share repurchases during the second quarter contributed a $0.32 per share increase to adjusted book value.
The complete results release is available here: ProAssurance Results for Second Quarter 2023