Employers Holdings, Inc. (NYSE:EIG) Q1 2018 Earnings Conference Call - Preliminary Transcript
Apr 26, 2018 • 11:30 am ET
Good day, ladies and gentlemen, and welcome to the Q1 2018 Employers Holdings, Inc. Earnings Conference Call. At this time all participants are in a listen-only mode. Later we will conduct the question-and-answer session.
As a reminder, this conference call is being recorded.
I'd now like to introduce your host for today's conference, Mr. Lenard Ormsby. Sir, you may begin.
Thank you, Jimmy. Good morning, and welcome to the first quarter 2018 earnings call for Employers. Today's call is being recorded and webcast from the Investor Relations section of our website where replay will be available following the call. With me today on the call are Doug Dirks, our Chief Executive Officer; Mike Paquette, our Chief Financial Officer; and Steve Festa, our Chief Operating Officer.
Statements made during this conference call that are not based on historical fact are considered forward-looking statements. These statements are made in reliance on the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. Although, we believe the expectations expressed in our forward-looking statements are reasonable, risks and uncertainties could cause actual results to be materially different from our expectations, including the risks set forth in our filings with the Securities and Exchange Commission.
All remarks made during the call are current at the time of the call and will not be updated to reflect subsequent developments. In our earnings press release and in our remarks or responses to questions, we may use non-GAAP financial metrics, including those that exclude the impact of the 1999 Loss Portfolio Transfer or LPT.
Reconciliations of these non-GAAP metrics are included in our financial supplement as an attachment to our earnings press release, our investor presentation and any other materials available in the investor section on our website.
Now, I will turn the call over to Doug.
Thank you, Lenard, and thank you all for joining us on the call today. The first quarter was a strong beginning to 2018. During the quarter, we grew written premium by healthy 7%, lowered our current asset and year loss provision rate and recognized favorable development on our prior year's loss reserves.
Our first quarter adjusted net income increased 55% or $0.31 per share from a year ago and our underwriting income doubled $18.3 million. Our combined ratio before the impact of the LPT of 91.1%, improved by 5.5 percentage points versus that of a year ago. During the first quarter, we delivered solid new business growth by actively pursuing opportunities that fit within our underwriting strategy and that met our underwriting requirements.
Despite the strong growth in new business, our top line premium continues to be pressured by declining rates in our renewal book of business. Manual rates or the rates filed with regulators by independent rating bureaus have declined in virtually all of our states due to declining loss cost. Our policy retention rates remained high, but our average renewal rate for the first quarter of 2018 decreased by 9.5% from a year ago.