James River Group Holdings, Ltd. (NASDAQ:JRVR) Q1 2018 Earnings Conference Call - Preliminary Transcript

May 03, 2018 • 09:00 am ET

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James River Group Holdings, Ltd. (NASDAQ:JRVR) Q1 2018 Earnings Conference Call - Preliminary Transcript

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Presentation
Operator
Operator

Good day, ladies and gentlemen, and welcome to the Q1 2018 James River Group Holdings Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. (Operator Instructions) As a reminder, this conference may be recorded.

I will now like to turn the conference over to our host of today's call, Mr. Kevin Copeland. You may begin.

Executive
Kevin Copeland

Thank you, Tonya. Good morning everyone, and welcome to the James River Group first quarter 2018 earnings conference call. During the call, we will be making forward-looking statements. These statements are based on current beliefs, intentions, expectations, and assumptions that are subject to various risks and uncertainties which may cause actual results to differ materially.

For a discussion of such risks and uncertainties, please see the cautionary language regarding forward-looking statements in yesterday's earnings release and the risk factors section of our most recent Form 10-K, Form 10-Qs and other reports and filings we make with the Securities and Exchange Commission. We do not undertake any duty to update any forward-looking statements.

I will now turn the call over to Bob Myron, Chief Executive Officer of James River Group.

Executive
Bob Myron

Thank you, Kevin, and good morning everyone. This is Bob Myron, and with me today are Sarah Doran, our CFO, and Kevin Copeland, who you just heard from, our Chief Investment Officer who also leads Investor Relations for us. We have a few prepared remarks, and then we look forward to taking your questions.

The year is off to a great start. We had strong top and bottom line performance in each of our three segments, with underwriting results showing a substantial improvement from a year ago, as highlighted in our press release. Our combined ratio for the group came in at a 96.4% and we had compelling combined ratios in all three segments, with favorable reserve development in each of them.

I am thrilled by the pricing increases we received in our core E&S book and very pleased with renewal pricing overall. While relative to a year ago our investment performance was down, in absolute terms investments performed well, roughly in line with our expectations. Let me talk about a few of these things in some more detail, and then I'll ask Sarah to do the same.

Regarding growth, in our E&S segment, we had strong growth overall and strong growth in most of the underlying divisions. The commercial auto division grew 84%, substantially assisted by the rate increases we have obtained on our largest account. In our core E&S book, we had growth in 9 of 12 divisions.

In particular, we saw strong growth in allied healthcare, which was up 208%, and energy, which was up 97%, and in general casualty, which was up 70%. Part of this growth was from rate increases, which I will discuss more in a minute, and part of it was from increased submission activity and opportunities in some larger accounts.