Henderson, NV – Employers Holdings, Inc. (NYSE:EIG), a holding company with subsidiaries that are specialty providers of workers’ compensation insurance and services focused on select, small businesses engaged in low-to-medium hazard industries, recently reported financial results for its third quarter ended September 30, 2023.
(All comparisons vs. the third quarter of 2022, unless noted otherwise).
- Net income of $14.0 million or $0.54 per share versus $19.1 million or $0.70 per share;
- Adjusted net income of $17.7 million or $0.68 per share versus $15.5 million or $0.56 per share, an increase of 21% per share;
- Gross premiums written of $196.2 million versus $188.6 million, an increase of 4%;
- Net premiums earned of $184.6 million versus $178.7 million, an increase of 3%;
- Net investment income of $25.9 million versus $23.7 million, an increase of 9%;
- Net investment losses reflected on the income statement of $7.1 million versus net gains of $1.9 million;
- Ending policies in-force of 126,120, up 5%; and
- Returned $21.7 million to stockholders through a combination of stock repurchases and regular quarterly dividends.
Chief Executive Officer Katherine Antonello commented: “Our third quarter results are a testament to the transformational changes we are making at Employers. Wage increases, a continued strong labor market for our target businesses and our disciplined appetite expansion each contributed to higher new and renewal premiums. As a result, we ended the quarter with more than 126,000 policies in-force, a record level representing increases in each of the last thirteen consecutive quarters.
We have maintained our current accident year loss and LAE ratio on voluntary business throughout the year at 63.3%, below the 64.0% we maintained throughout 2022. As was the case in the third quarter of 2022, we did not recognize any prior year loss reserve development this quarter because: (i) a full actuarial study was not performed; and (ii) the amount of indicated net prior year loss reserve development was consistent with our expectations. We will evaluate our prior year reserves in more detail at year-end when we routinely perform a full reserve study.
Our total underwriting expenses (consisting of our commissions, underwriting and general and administrative expenses) of $70.2 million this quarter were up $3.0 million, or 4% from a year ago. The increase was largely driven by an increase in our variable expenses (those that fluctuate with our premium volume) and higher 2023 agency incentive accruals, which are specific to individual contracts and vary with agency growth and profitability. We remain confident that we can further reduce our total underwriting expenses, as a percentage of our earned premiums, in 2024.
We continue to actively return capital to our stockholders. Our capital management efforts this quarter consisted of $14.4 million of share repurchases and $7.3 million of regular quarterly dividends, and our efforts year-to-date consisted of $61.6 million of share repurchases and $22.0 million of regular quarterly dividends. These actions reflect our strong balance sheet, abundant underwriting capital and confidence in the Company’s future operations.”
The complete results release is available here: Employers Holdings, Inc. Third Quarter 2023 Results