PALOMAR HOLDINGS, INC. (NASDAQ:PLMR) Q3 2019 Earnings Conference Call - Final Transcript
Nov 05, 2019 • 12:00 pm ET
Good morning and welcome to the Palomar Holdings, Inc. Third Quarter 2019 Earnings Conference Call. [Operator Instructions] Following the presentation, the conference line will be opened for questions. With instructions to follow at that time. As a reminder, this conference call is being recorded.
I would now like to turn the call over to Mr Chris Uchida, Chief Financial Officer. Please go ahead, sir.
Thank you, operator, and good morning, everyone. We appreciate your participation in our third-quarter 2019 earnings call. With me here today is Mac Armstrong, our Chief Executive Officer and Founder. As a reminder, a telephonic replay of this call will be available on the Investor Relations section of our website through 11:59 PM Eastern Time on the November 12, 2019.
Before we begin, let me remind everyone that this call may contain certain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include remarks about management's future expectations, beliefs, estimates, plans and prospects such statements are subject to a variety of risks, uncertainties and other factors that could cause actual results to differ materially from those indicated or implied by such statement. Such risks and other factors are set forth in our quarterly report on Form 10-Q and will be filed with the Securities and Exchange Commission today, November 5, 2019.
We do not undertake any duty to update such forward-looking statements. Additionally, during today's call, we will discuss certain non-GAAP measures, which we believe are useful in evaluating our performance. The presentation of this additional information should not be considered in isolation or as a substitute for the results prepared in accordance with US GAAP. A reconciliation of these non-GAAP measures to the most comparable GAAP measures can be found in our earnings release.
At this point, I'll turn the call over to Mac.
Thank you, Chris, and good morning, everyone. Our third-quarter results demonstrate the successful execution of Palomar's strategy and focus on profitable growth. We continue to enhance our product portfolio and expand our geographic footprint in the markets where we can deliver differentiated products that serve the needs of our customers and generate attractive underwriting income. This is best evidenced in the third quarter by our year-over-year gross written premium growth of 65.6% and our adjusted net income of $9.6 million and net income of $7.5 million.
Our Residential Earthquake products, which comprised 53.9% of our gross written premium, generated 66.2% growth compared to the third quarter of last year. As discussed on our second quarter call, the Ridgecrest earthquake in Southern California in July, a third quarter event, caused a surge in demand for our Residential Earthquake products, a phenomenon that is common after earthquake events.
In the third quarter, California Residential Earthquake new business policy count was 62.5% higher than the second quarter of 2019, and overall third quarter new Residential Earthquake policies increased 50.4% sequentially. Third quarter Residential Earthquake new business policies increased 87.6% over the prior year. This increase in