RLI Corp. (NYSE:RLI) Q1 2019 Earnings Conference Call - Final Transcript
Apr 18, 2019 • 11:00 am ET
[Operator Instructions] Our first question comes from Matthew Carletti with JMP Securities.
Hi. Thanks, good morning. Just Craig, maybe if I could go back to your casualty comments and just have you dig in a little deeper. I'm curious what you're seeing in the E&S environment for those lines, or in your E&S business, in particular, pricing, submission flow, standard line markets behavior. Are things starting to perk up there or is it largely unchanged?
Well, I think that, if I go beyond just this quarter, I think, if you look over last year, I think, certainly submissions were up a little more. This quarter, I think, they were a little flatter, which is a little counter to probably what I have been reading, but for us at least submission -- submissions were relatively flat for the quarter.
Okay, great. And then just a casualty kind of just broader, observing the accident year loss ratio, it was improved a little bit in Q1 versus a full-year, last year, it was at the lower end of, if I look back kind of a couple of years, kind of the lower end of the quarterly run rate. Is there anything particular going on there, or is it just varying mix by quarter or is it a view that you're getting pricing that's meeting or exceeding lost trend, is there anything to read into that or is it just more kind of how the cards fell?
Matt, this is Craig, again. I would say it's pretty much mix related. And as you know, we've done a lot of repositioning, and particular in the casualty portfolio, so I probably couldn't isolate on one single thing.
Okay, great. Thanks a lot and congrats on the quarter.
We'll now take a question from Bijan Moazami from Compass Point Research.
Good morning, everyone. From your commentary, it's very clear, you're getting rate increases across the board everywhere. And what's driving that rate increase across the industry? I guess, with the exception of commercial auto, it seems that a lot of the product lines doesn't appear to be showing adverse loss reserves in the industry, so just want to get a feeling of how sustainable those rate increases are? And then I have a follow-up question.
Well, Bijan, this is Craig, again. I don't think I said it was across the portfolio, so just to clarify. But I mean, we have seen some selected spots continued in transportation, certainly, in the umbrella space, in certain geographies. In marine, we've seen more price than we've seen in the past. And the other places kind of have remained pretty stable as far as the increases. But those are relatively low single-digit rate increases that we're seeing, not -- nothing really out of the ordinary or anything out of what we've seen in the past.
And the umbrella 15%, is that rate you mentioned, or is it premium volume growth, and if it's growing that fast, what's happening there?