uihc-20230515
FALSE000140152100014015212023-05-152023-05-15

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): May 15, 2023

UNITED INSURANCE HOLDINGS CORP.
(Exact name of registrant as specified in its charter)
Delaware001-3576175-3241967
(State or other jurisdiction of incorporation)(Commission File Number)(IRS Employer Identification No.)
800 2nd Avenue S.33701
Saint Petersburg,FL
(Address of principal executive offices)(Zip Code)
(727)895-7737
(Registrant's telephone number, including area code)
(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading Symbol(s)Name of Each Exchange on Which Registered
Common stock, $0.0001 par value per shareUIHCNasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


Item 2.02. Results of Operations and Financial Condition

On May 15, 2023, United Insurance Holdings Corp. (the Company, we, our) issued a press release relating to our earnings for the first quarter ended March 31, 2023 (the Earnings Release). We have attached a copy of the Earnings Release as Exhibit 99.1.

Item 7.01: Regulation FD Disclosure.
The executive officers of the Company intend to use the materials filed herewith, in whole or in part, in one or more meetings with investors and analysts, beginning on May 15, 2023. A copy of the investor presentation is attached hereto as Exhibit 99.2.

The information furnished under this Item 2.02 and 7.01, including Exhibit 99.1 and Exhibit 99.2 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference to such filing.

Item 9.01. Financial Statements and Exhibits
Exhibit
No.		 Description
     
Earnings release issued by the Company on May 15, 2023
Investor presentation issued by the Company on May 15, 2023
104Cover Page Interactive Data File (embedded within the Inline XBRL document)



Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunder duly authorized.
    
  UNITED INSURANCE HOLDINGS CORP.
May 15, 2023
By:/s/ B. Bradford Martz
  B. Bradford Martz, President and Chief Financial Officer
(principal financial officer and principal accounting officer)



Exhibit 99.1
FOR IMMEDIATE RELEASE
UNITED INSURANCE HOLDINGS CORP. REPORTS FINANCIAL RESULTS
FOR ITS FIRST QUARTER ENDED MARCH 31, 2023
 
Company to Host Quarterly Conference Call at 5:00 P.M. ET on May 15, 2023
The information in this press release should be read in conjunction with an investor presentation that is available on the Company's website at investors.upcinsurance.com/Presentations.
 
St. Petersburg, FL - May 15, 2023: United Insurance Holdings Corp. (Nasdaq: UIHC) ("UIHC" or "the Company"), a property and casualty insurance holding company, today reported its financial results for the first quarter ended March 31, 2023. On February 27, 2023, the Florida Department of Financial Services was appointed as receiver of the Company's former subsidiary, United Property and Casualty Insurance Company ("UPC"). As such, prior year financial results have been recast to reflect the activity of UPC within discontinued operations.

($ in thousands, except for per share data)Three Months Ended
March 31,
20232022Change
Gross premiums written$187,123 $142,414 31.4 %
Gross premiums earned$144,476 $122,733 17.7 %
Net premiums earned$87,324 $57,746 51.2 %
Total revenues$104,047 $117,361 (11.3)%
Earnings from continuing operations, before income tax$40,428 $5,627 618.5 %
Income (loss) from discontinued operations, net of tax$230,305 $(37,904)NM
Consolidated net income (loss) attributable to UIHC$260,878 $(33,172)NM
Net income (loss) available to UIHC stockholders per diluted share
Continuing Operations$0.70 $0.11 536.4 %
Discontinued Operations5.29 (0.88)NM
Total$5.99 $(0.77)NM
Reconciliation of net income (loss) to core income (loss):
Plus: Non-cash amortization of intangible assets$812 $812 — %
Less: Income (loss) from discontinued operations, net of tax$230,305 $(37,904)NM
Less: Net realized gains (losses) on investment portfolio$(83)$37 NM
Less: Unrealized gains (losses) on equity securities$474 $(770)NM
Less: Net tax impact (1)
$88 $324 (72.8)%
Core income (loss) (2)
$30,906 $5,953 419.2 %
Core income (loss) per diluted share (2)
$0.71 $0.14 407.1 %
Book value per share$1.93 $(4.21)145.8 %
NM = Not Meaningful
(1) In order to reconcile net income (loss) to the core income (loss) measures, the Company included the tax impact of all adjustments using the 21% corporate federal tax rate.
(2) Core loss, and core loss per diluted share, both of which are measures that are not based on GAAP, are reconciled above to net income (loss) and net income (loss) per diluted share, respectively, the most directly comparable GAAP measures. Additional information regarding non-GAAP financial measures presented in this press release can be found in the "Definitions of Non-GAAP Measures" section, below.



1
Exhibit 99.1

"Our commercial lines portfolio written in our subsidiary American Coastal Insurance Company continued to perform very well, which is reflected within the Net Income from Continuing Operations for the current period ended March 31, 2023," said Dan Peed, Chief Executive Officer. "We believe these results are sustainable in the near and intermediate terms given the hard market conditions in Florida and reflect our transition to a commercial specialty insurer."


Return on Equity and Core Return on Equity

The calculations of the Company's return on equity and core return on equity are shown below.
($ in thousands)Three Months Ended
March 31,
20232022
Income from continuing operations, net of tax$30,573 $4,647 
Return on equity based on GAAP earnings from continuing operations, net of tax (1)
198.5 %5.8 %
Income (loss) from discontinued operations, net of tax$230,305$(37,904)
Return on equity based on GAAP income (loss) from discontinued operations, net of tax (1)
NM(47.6)%
Consolidated net income (loss) attributable to UIHC$260,878$(33,172)
Return on equity based on GAAP net income (loss) attributable to UIHC (1)
NM(41.7)%
Core income (loss)$30,906$5,953
Core return on equity (1)(2)
200.6 %7.5 %
(1) Return on equity for the three months ended March 31, 2023 and 2022 is calculated on an annualized basis by dividing the net income (loss) or core income (loss) for the period by the average stockholders' equity for the trailing twelve months.
(2) Core return on equity, a measure that is not based on GAAP, is calculated based on core income (loss), which is reconciled on the first page of this press release to net income (loss), the most directly comparable GAAP measure. Additional information regarding non-GAAP financial measures presented in this press release can be found in the "Definitions of Non-GAAP Measures" section below.



























2
Exhibit 99.1
Combined Ratio and Underlying Ratio

The calculations of the Company's combined ratio and underlying combined ratio on a consolidated basis and attributable to both the Company's personal lines and commercial residential property and casualty insurance policies (commercial lines) operating segments are shown below.
($ in thousands)Three Months Ended
March 31,
20232022Change
Consolidated
Loss ratio, net(1)
21.9 %56.3 %(34.4) pts
Expense ratio, net(2)
48.6 %135.4 %(86.8) pts
Combined ratio (CR)(3)
70.5 %191.7 %(121.2) pts
Effect of current year catastrophe losses on CR3.5 %11.4 %(7.9) pts
Effect of prior year unfavorable (favorable) development on CR(3.6)%(5.3)%1.7  pts
Underlying combined ratio(4)
70.6 %185.6 %(115.0) pts
Personal Lines
Loss ratio, net(1)
59.7 %149.6 %(89.9) pts
Expense ratio, net(2)
163.2 %468.3 %(305.1) pts
Combined ratio (CR)(3)
222.9 %617.9 %(395.0) pts
Effect of current year catastrophe losses on CR11.2 %28.0 %(16.8) pts
Effect of prior year unfavorable (favorable) development on CR(4.6)%(10.2)%5.6  pts
Underlying combined ratio(4)
216.3 %600.1 %(383.8) pts
Commercial Lines
Loss ratio, net(1)
17.7 %31.1 %(13.4) pts
Expense ratio, net(2)
35.6 %44.2 %(8.6) pts
Combined ratio (CR)(3)
53.3 %75.3 %(22.0) pts
Effect of current year catastrophe losses on CR2.7 %6.8 %(4.1) pts
Effect of prior year favorable development on CR(3.5)%(4.0)%0.5  pts
Underlying combined ratio(5)
54.1 %72.5 %(18.4) pts
(1) Loss ratio, net is calculated as losses and loss adjustment expenses (LAE), net of losses ceded to reinsurers, relative to net premiums earned.
(2) Expense ratio, net is calculated as the sum of all operating expenses less interest expense relative to net premiums earned.
(3) Combined ratio is the sum of the loss ratio, net and expense ratio, net.
(4) Underlying combined ratio, a measure that is not based on GAAP, is reconciled above to the combined ratio, the most directly comparable GAAP measure. Additional information regarding non-GAAP financial measures presented in this press release can be found in the "Definitions of Non-GAAP Measures" section, below.















3
Exhibit 99.1
Combined Ratio Analysis

The calculations of the Company's loss ratios and underlying loss ratios are shown below.
($ in thousands)Three Months Ended
March 31,
20232022Change
Loss and LAE$19,073 $32,518 $(13,445)
% of Gross earned premiums13.3 %26.5 %(13.2) pts
% of Net earned premiums21.9 %56.3 %(34.4) pts
Less:
Current year catastrophe losses$3,071 $6,555 $(3,484)
Prior year reserve unfavorable (favorable) development(3,165)(3,064)(101)
Underlying loss and LAE (1)
$19,167 $29,027 $(9,860)
% of Gross earned premiums13.3 %23.7 %(10.4) pts
% of Net earned premiums21.9 %50.3 %(28.4) pts
(1) Underlying loss and LAE is a non-GAAP financial measure and is reconciled above to loss and LAE, the most directly comparable GAAP measure. Additional information regarding non-GAAP financial measures presented in this press release can be found in the "Definitions of Non-GAAP Measures" section, below.


The calculations of the Company's expense ratios are shown below.
($ in thousands)Three Months Ended
March 31,
20232022Change
Policy acquisition costs$26,927 $52,152 $(25,225)
Operating and underwriting5,651 10,603 (4,952)
General and administrative9,837 15,435 (5,598)
Total Operating Expenses$42,415 $78,190 $(35,775)
% of Gross earned premiums
29.4 %63.7 %(34.3) pts
% of Net earned premiums
48.6 %135.4 %(86.8) pts
















4
Exhibit 99.1

Quarterly Financial Results
Net income attributable to the Company for the first quarter of 2023 was $260.9 million, or $5.99 per diluted share, compared to a net loss of $33.2 million, or $0.77 per diluted share, for the first quarter of 2022. Drivers of the net income from continuing operations during the first quarter of 2023 include increased gross premiums earned, decreased loss and LAE driven by decreased non-catastrophe losses, and decreases across policy acquisition costs, operating and underwriting expenses and general and administrative expenses. In addition to continuing operations, we recognized income from discontinued operations of $230.3 million, driven by the deconsolidation of UPC.

The Company's total gross written premium increased by $44.7 million, or 31.4%, to $187.1 million for the first quarter of 2023, from $142.4 million for the first quarter of 2022. This increase was driven primarily by an increase in our commercial premiums written, as we focus on transitioning towards a specialty commercial lines underwriter. The breakdown of the quarter-over-quarter changes in both direct written and assumed premiums by state and gross written premium by line of business are shown in the table below.

($ in thousands)Three Months Ended
 March 31,
20232022Change $Change %
Direct Written and Assumed Premium by State (1)
Florida $176,611 $125,764 $50,847 40.4 %
Texas(9)1,986 (1,995)(100.5)
New York10,482 14,450 (3,968)(27.5)
South Carolina— 93 (93)(100.0)
Total direct written premium by state187,084 142,293 44,791 31.5 
Assumed premium (2)
39 121 (82)(67.8)
Total gross written premium by state$187,123 $142,414 $44,709 31.4 %
Gross Written Premium by Line of Business
Commercial property$176,641 $127,964 $48,677 38.0 %
Personal property10,482 14,450 (3,968)(27.5)
Total gross written premium by line of business$187,123 $142,414 $44,709 31.4 %
(1) We are no longer writing in Texas or South Carolina as of May 31, 2022.
(2) Assumed premium written for 2023 and 2022 primarily included commercial property business assumed from unaffiliated insurers.


Loss and LAE decreased by $13.4 million, or 41.2%, to $19.1 million for the first quarter of 2023, from $32.5 million for the first quarter of 2022. Loss and LAE expense as a percentage of net earned premiums decreased 34.4 points to 21.9% for the first quarter of 2023, compared to 56.3% for the first quarter of 2022. Excluding catastrophe losses and reserve development, the Company's gross underlying loss and LAE ratio for the first quarter of 2023 would have been 13.3%, a decrease of 10.4 points from 23.7% during the first quarter of 2022.

Policy acquisition costs decreased by $25.3 million, or 48.5%, to $26.9 million for the first quarter of 2023, from $52.2 million for the first quarter of 2022, primarily due to decreases in agent commissions and policy administration fees, which fluctuate in conjunction with the quarter-over-quarter decrease in personal lines gross written premium. This was partially offset by an increase in external management fees incurred related to our commercial lines gross written premium during the first quarter of 2023, driven by increased written premium quarter-over-quarter.

Operating and underwriting expenses decreased by $4.9 million, or 46.2%, to $5.7 million for the first quarter of 2023, from $10.6 million for the first quarter of 2022, primarily due to decreased investments in technology and decreased underwriting expenses as the result of the decrease in personal lines premiums shown in the table above.

General and administrative expenses decreased by $5.6 million, or 36.4%, to $9.8 million for the first quarter of 2023, from $15.4 million for the first quarter of 2022, driven by a decrease in salary related expenses attributable to decreased headcount quarter-over-quarter.

5
Exhibit 99.1
Personal Lines Operating Segment Highlights

Pre-tax earnings attributable to the Company's personal lines operating segment totaled $4.7 million for the first quarter of 2023 compared to a pre-tax loss of $4.7 million for the first quarter of 2022. Drivers of the quarter-over-quarter increase in pre-tax earnings include: a decrease in policy acquisition costs of $33.7 million, driven by decreased agent commissions and policy administration fees, a decrease in loss and LAE incurred of $13.2 million due to decreased non-catastrophe losses. The Company also experienced decreased operating expenses of $4.0 million driven by decreased investments in technology and underwriting expenses, and decreased general and administrative costs of $5.8 million, driven by decreased salary related expenses. These decreased expenses can be attributed to the Company's shift towards becoming a specialty commercial lines underwriter, resulting in reduced exposure, and lower costs associated with the servicing of this business.

Commercial Lines Operating Segment Highlights

Pre-tax earnings attributable to the Company's commercial lines operating segment totaled $38.9 million for the first quarter of 2023 compared to $11.6 million for the first quarter of 2022. This increase can be attributed to increased gross written premiums of $48.7 million, as the Company transitions towards becoming a specialty commercial lines underwriter.

This increased premium was partially offset by increased policy acquisition costs of $8.5 million, driven by increases in external management fees as a result of the increased premiums. Operating and underwriting and general and administrative expenses remained relatively flat, with a net decrease of $579 thousand experienced quarter-over-quarter.

Reinsurance Costs as a Percentage of Gross Earned Premium

Reinsurance costs as a percentage of gross earned premium in the first quarter of 2023 and 2022 were as follows:
20232022
Non-at-Risk(0.5)%(0.6)%
Quota Share(6.1)%(15.6)%
All Other(33.0)%(36.8)%
Total Ceding Ratio(39.6)%(53.0)%

Ceded premiums earned related to the Company's quota share reinsurance contracts decreased quarter-over-quarter driven by the non-renewal of external quota share contracts that provided coverage to ACIC in 2022.

Ceded premiums earned related to the Company's catastrophe program decreased, driven by the need for less coverage for the 2022-2023 treaty year for the reduction in the geographic footprint and exposure, as well as the change from a cascading aggregate structure to an occurrence-based structure for the Company's 2022-2023 program.

Reinsurance costs as a percentage of gross earned premium in the first quarter of 2023 and 2022 for the Company's personal lines and commercial lines operating segments were as follows:

PersonalCommercial
2023202220232022
Non-at-Risk(1.6)%(1.2)%(0.4)%(0.5)%
Quota Share— %— %(6.7)%(17.8)%
All Other(28.8)%(18.2)%(33.3)%(39.4)%
Total Ceding Ratio(30.4)%(19.4)%(40.4)%(57.7)%





6
Exhibit 99.1
Investment Portfolio Highlights

The Company's cash, restricted cash and investment holdings increased from $340.9 million at December 31, 2022 to $372.7 million at March 31, 2023. The Company's cash and investment holdings consist of investments in U.S. government and agency securities, corporate debt and investment grade money market instruments. Fixed maturities represented approximately 91.4% of total investments at both March 31, 2023 and December 31, 2022. The Company's fixed maturity investments had a modified duration of 4.0 years at both March 31, 2023 and December 31, 2022.

Book Value Analysis

Book value per common share increased 145.9% from $(4.21) at December 31, 2022, to $1.93 at March 31, 2023. Underlying book value per common share increased 172.2% from $(3.49) at December 31, 2022 to $2.52 at March 31, 2023. A increase in the Company's retained earnings as the result of net income from both continuing and discontinued operations in the first quarter of 2023 drove the increase in the Company's book value per share. As shown in the table below, removing the effect of AOCI increases the Company's book value per common share, as the Company has experienced unfavorable capital market conditions resulting in an accumulated other comprehensive loss position at March 31, 2023.
($ in thousands, except for share and per share data)March 31, 2023December 31, 2022
Book Value per Share
Numerator:
Common stockholders' equity attributable to UIHC$83,488 $(182,039)
Denominator:
Total Shares Outstanding43,274,359 43,280,173 
Book Value Per Common Share$1.93 $(4.21)
Book Value per Share, Excluding the Impact of Accumulated Other Comprehensive Income (AOCI)
Numerator:
Common stockholders' equity attributable to UIHC$83,488 $(182,039)
Less: Accumulated other comprehensive loss(25,629)(30,947)
Stockholders' Equity, excluding AOCI$109,117 $(151,092)
Denominator:
Total Shares Outstanding43,274,359 43,280,173 
Underlying Book Value Per Common Share(1)
$2.52 $(3.49)
(1) Underlying book value per common share is a non-GAAP financial measure and is reconciled above to book value per common share, the most directly comparable GAAP measure. Additional information regarding non-GAAP financial measures presented in this press release can be found in the "Definitions of Non-GAAP Measures" section below.





















7
Exhibit 99.1


Conference Call Details

Date and Time:    May 15, 2023 - 5:00 P.M. ET

Participant Dial-In:    (United States): 877-445-9755
    (International): 201-493-6744

Webcast:    To listen to the live webcast, please go to http://investors.upcinsurance.com and click on the conference call link at the top of the page or go to: https://event.webcasts.com/starthere.jsp?ei=1611651&tp_key=0f9fd0672f

An archive of the webcast will be available for a limited period of time thereafter.

Presentation:     The information in this press release should be read in conjunction with an investor presentation that is available on the Company's website at investors.upcinsurance.com/Presentations.

About United Insurance Holdings Corp.

Founded in 1999, United Insurance Holdings Corp. is an insurance holding company that sources, writes and services personal and commercial residential property and casualty insurance policies using a group of wholly owned insurance subsidiaries through a variety of distribution channels.


 ### #### ###
CONTACT:ORINVESTOR RELATIONS:
United Insurance Holdings Corp.The Equity Group
Alexander BatyKarin Daly
Director of Financial ReportingVice President
(727) 895-7737 / [email protected](212) 836-9623 / [email protected]


















8
Exhibit 99.1

Definitions of Non-GAAP Measures

The Company believes that investors' understanding of UIHC's performance is enhanced by the Company's disclosure of the following non-GAAP measures. The Company's methods for calculating these measures may differ from those used by other companies and therefore comparability may be limited.

Net income (loss) excluding the effects of amortization of intangible assets, income (loss) from discontinued operations, realized gains (losses) and unrealized gains (losses) on equity securities, net of tax (core income (loss)) is a non-GAAP measure that is computed by adding amortization, net of tax, to net income (loss) and subtracting income (loss) from discontinued operations, net of tax, realized gains (losses) on the Company's investment portfolio, net of tax, and unrealized gains (losses) on the Company's equity securities, net of tax, from net income (loss). Amortization expense is related to the amortization of intangible assets acquired, including goodwill, through mergers and, therefore, the expense does not arise through normal operations. Investment portfolio gains (losses) and unrealized equity security gains (losses) vary independent of the Company's operations. The Company believes it is useful for investors to evaluate these components both separately and in the aggregate when reviewing the Company's performance. The most directly comparable GAAP measure is net income (loss). The core income (loss) measure should not be considered a substitute for net income (loss) and does not reflect the overall profitability of the Company's business.

Core return on equity is a non-GAAP ratio calculated using non-GAAP measures. It is calculated by dividing the core income (loss) for the period by the average stockholders’ equity for the trailing twelve months (or one quarter of such average, in the case of quarterly periods). Core income (loss) is an after-tax non-GAAP measure that is calculated by excluding from net income (loss) the effect of income (loss) from discontinued operations, net of tax, non-cash amortization of intangible assets, including goodwill, unrealized gains or losses on the Company's equity security investments and net realized gains or losses on the Company's investment portfolio. In the opinion of the Company’s management, core income (loss), core income (loss) per share and core return on equity are meaningful indicators to investors of the Company's underwriting and operating results, since the excluded items are not necessarily indicative of operating trends. Internally, the Company’s management uses core income (loss), core income (loss) per share and core return on equity to evaluate performance against historical results and establish financial targets on a consolidated basis. The most directly comparable GAAP measure is return on equity. The core return on equity measure should not be considered a substitute for return on equity and does not reflect the overall profitability of the Company's business.

Combined ratio excluding the effects of current year catastrophe losses and prior year reserve development (underlying combined ratio) is a non-GAAP measure, that is computed by subtracting the effect of current year catastrophe losses and prior year development from the combined ratio. The Company believes that this ratio is useful to investors, and it is used by management to highlight the trends in the Company's business that may be obscured by current year catastrophe losses and prior year development. Current year catastrophe losses cause the Company's loss trends to vary significantly between periods as a result of their frequency of occurrence and severity and can have a significant impact on the combined ratio. Prior year development is caused by unexpected loss development on historical reserves. The Company believes it is useful for investors to evaluate these components both separately and in the aggregate when reviewing the Company's performance. The most directly comparable GAAP measure is the combined ratio. The underlying combined ratio should not be considered as a substitute for the combined ratio and does not reflect the overall profitability of the Company's business.

Net loss and LAE excluding the effects of current year catastrophe losses and prior year reserve development (underlying loss and LAE) is a non-GAAP measure that is computed by subtracting the effect of current year catastrophe losses and prior year reserve development from net loss and LAE. The Company uses underlying loss and LAE figures to analyze the Company's loss trends that may be impacted by current year catastrophe losses and prior year development on the Company's reserves. As discussed previously, these two items can have a significant impact on the Company's loss trends in a given period. The Company believes it is useful for investors to evaluate these components both separately and in the aggregate when reviewing the Company's performance. The most directly comparable GAAP measure is net loss and LAE. The underlying loss and LAE measure should not be considered a substitute for net loss and LAE and does not reflect the overall profitability of the Company's business.



9
Exhibit 99.1


Book value per common share, excluding the impact of accumulated other comprehensive loss (underlying book value per common share), is a non-GAAP measure that is computed by dividing common stockholders' equity after excluding accumulated other comprehensive income (loss), by total common shares outstanding plus dilutive potential common shares outstanding. The Company uses the trend in book value per common share, excluding the impact of accumulated other comprehensive income (loss), in conjunction with book value per common share to identify and analyze the change in net worth attributable to management efforts between periods. The Company believes this non-GAAP measure is useful to investors because it eliminates the effect of interest rates that can fluctuate significantly from period to period and are generally driven by economic and financial factors that are not influenced by management. Book value per common share is the most directly comparable GAAP measure. Book value per common share, excluding the impact of accumulated other comprehensive income (loss), should not be considered a substitute for book value per common share and does not reflect the recorded net worth of the Company's business.


Forward-Looking Statements

Statements made in this press release, or on the conference call identified above, and otherwise, that are not historical facts are “forward-looking statements”. The Company believes these statements are based on reasonable estimates, assumptions and plans. However, if the estimates, assumptions, or plans underlying the forward-looking statements prove inaccurate or if other risks or uncertainties arise, actual results could differ materially from those expressed in, or implied by, the forward-looking statements. These statements are made subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements do not relate strictly to historical or current facts and may be identified by their use of words such as “may,” “will,” “expect,” "endeavor," "project," “believe,” "plan," “anticipate,” “intend,” “could,” “would,” “estimate” or “continue” or the negative variations thereof or comparable terminology. Factors that could cause actual results to differ materially may be found in the Company's filings with the U.S. Securities and Exchange Commission, in the “Risk Factors” section in the Company's most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q. Forward-looking statements speak only as of the date on which they are made, and, except as required by applicable law, the Company undertakes no obligation to update or revise any forward-looking statements.
10
Exhibit 99.1
Consolidated Statements of Comprehensive Income (Loss)
In thousands, except share and per share amounts
Three Months Ended
March 31,
20232022
REVENUE:
Gross premiums written$187,123 $142,414 
Change in gross unearned premiums(42,647)(19,681)
Gross premiums earned144,476 122,733 
Ceded premiums earned(57,152)(64,987)
Net premiums earned87,324 57,746 
Net investment income 2,589 1,404 
Net realized investment gains (losses)(83)37 
Net unrealized gains (losses) on equity securities474 (770)
Management fee income9,668 50,206 
Other revenue4,075 8,738 
Total revenues$104,047 $117,361 
EXPENSES:
Losses and loss adjustment expenses19,073 32,518 
Policy acquisition costs26,927 52,152 
Operating expenses5,651 10,603 
General and administrative expenses9,837 15,435 
Interest expense2,719 2,359 
Total expenses 64,207 113,067 
Income before other income39,840 4,294 
Other income588 1,333 
Income before income taxes40,428 5,627 
Provision for income taxes9,855 980 
Income from continuing operations, net of tax$30,573 $4,647 
Income (loss) from discontinued operations, net of tax230,305 (37,904)
Net income (loss)$260,878 $(33,257)
Less: Net loss attributable to noncontrolling interests— (85)
Net income (loss) attributable to UIHC$260,878 $(33,172)
OTHER COMPREHENSIVE INCOME (LOSS):
Change in net unrealized gains (losses) on investments4,231 (27,689)
Reclassification adjustment for net realized investment losses (gains)83 1,769 
Income tax benefit related to items of other comprehensive income (loss)— 6,236 
Total comprehensive income (loss)$265,192 $(52,941)
Less: Comprehensive loss attributable to noncontrolling interests— (643)
Comprehensive income (loss) attributable to UIHC$265,192 $(52,298)
Weighted average shares outstanding
Basic43,124,825 42,980,691 
Diluted43,574,840 42,980,691 
Earnings available to UIHC common stockholders per share
Basic
Continuing operations$0.71 $0.11 
Discontinued operations5.34 (0.88)
Total$6.05 $(0.77)
Diluted
Continuing operations$0.70 $0.11 
Discontinued operations5.29 (0.88)
Total$5.99 $(0.77)
Dividends declared per share$— $0.06 
11
Exhibit 99.1
Consolidated Balance Sheets
In thousands, except share amounts
March 31, 2023December 31, 2022
ASSETS 
Investments, at fair value:  
Fixed maturities, available-for-sale$210,733 $204,682 
Equity securities16,181 15,657 
Other investments3,550 3,675 
Total investments$230,464 $224,014 
Cash and cash equivalents92,586 70,903 
Restricted cash49,671 45,988 
Accrued investment income1,818 1,605 
Property and equipment, net18,118 19,591 
Premiums receivable, net48,120 39,301 
Reinsurance recoverable on paid and unpaid losses792,350 796,546 
Ceded unearned premiums65,702 90,496 
Goodwill59,476 59,476 
Deferred policy acquisition costs59,897 60,979 
Intangible assets, net11,758 12,770 
Other assets15,426 3,920 
Assets held for disposal— 1,411,907 
Total Assets$1,445,386 $2,837,496 
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Unpaid losses and loss adjustment expenses$748,365 $842,958 
Unearned premiums301,625 258,978 
Reinsurance payable on premiums33,908 30,503 
Payments outstanding2,326 2,000 
Accounts payable and accrued expenses89,582 75,374 
Operating lease liability1,412 1,689 
Other liabilities36,242 17,466 
Notes payable, net148,438 148,355 
Liabilities held for disposal— 1,642,212 
Total Liabilities$1,361,898 $3,019,535 
Commitments and contingencies
Stockholders' Equity:
Preferred stock, $0.0001 par value; 1,000,000 authorized; none issued or outstanding— — 
Common stock, $0.0001 par value; 100,000,000 shares authorized; 43,486,442 and 43,492,256 issued, respectively; 43,274,359 and 43,280,173 outstanding, respectively
4 4 
Additional paid-in capital395,966 395,631 
Treasury shares, at cost; 212,083 shares(431)(431)
Accumulated other comprehensive loss(25,629)(30,947)
Retained earnings (deficit)(286,422)(546,296)
Total Stockholders' Equity$83,488 $(182,039)
Total Liabilities and Stockholders' Equity$1,445,386 $2,837,496 
12
Investor Presentation First Quarter 2023

 
Company Overview 2 UIHC is a specialty underwriter of catastrophe exposed property insurance. United Insurance Holding Corp. (Nasdaq: UIHC) was founded in 1999 and is the insurance holding company for two P&C carriers: American Coastal Insurance Company (ACIC) and Interboro Insurance Company (IIC) along with other operating affiliates. ACIC has the #1 market share of commercial residential property insurance (commercial lines) in Florida with roughly 5,100 policies and $563 million of premium in-force. IIC’s homeowners & fire insurance products (personal lines) are written exclusively in New York with roughly 18,000 policies and $31 million of premium in-force. UIHC as of March 31, 2023 Total Assets: $1.4 billion Total Equity: $83.5 million Annualized Revenue: $416.2 million Employees: 110 Headquarters: St. Petersburg, FL Credit Rating: BB+ (Kroll) Specialty Commercial Property Specialty Homeowners

 
3 Executive Summary • Q1-23 Results • GAAP net income of $260.9m included a $230.3m gain from discontinued operations from de-consolidating our former affiliate United Property & Casualty Insurance Company (UPC). The prior year was recast to conform to the presentation of discontinued operations. • GAAP net income from continuing operations of $30.5m improved 563% from $4.6m last year driven by strong underwriting performance in commercial lines from ACIC. UIHC’s combined ratio of 70.5% was also a significant improvement from the prior year. • Current accident year catastrophe losses of $3.1m compared favorably to $6.6m last year, and favorable prior year reserve development of $3.2m primarily in commercial lines was also a positive contribution and consistent with the prior year. • Stockholders’ equity attributable to UIHC as of March 31, 2023, was $83.5m or $1.93 per share and $2.52 per share excluding unrealized losses in accumulated other comprehensive income. • Other Highlights • On April 19, 2023, we obtained a memorandum of understanding from the Florida Department of Financial Services (DFS) ratifying and accepting a reinsurance allocation agreement covering the 2022 core catastrophe reinsurance program previously approved by the Office of Insurance Regulation. This action provided critical clarity regarding future reinsurance recoverable for ACIC related to Hurricane Ian but did not settle reinsurance recovered by UPC on behalf of ACIC. We are working diligently with the DFS to resolve this. • We have secured 100% of the capacity needed for our new 2023-24 catastrophe reinsurance program for ACIC and are also nearing completion of IIC’s program renewal to be effective 6/1/23 and expect to announce the key details once the programs are finalized. • The Company believes these two highlights above along with other actions being taken to resolve all amounts due to and from UPC will ultimately rectify the two primary reasons identified by our independent auditor for their going concern opinion issued on April 17, 2023.

 
Q1-23 Summary Results 4 UIHC’s solid results were fueled by our leading commercial residential business in Florida. ¹ 2022 amounts recast for discontinued operations $ in thousands, except per share amounts Q1-23 Q1-22 ¹ Change Net income (loss) 260,878$ (33,172)$ n/m per diluted share (EPS) 5.99$ (0.77)$ Reconciliation to core income (loss): Investment gains (losses) 309$ (580)$ Amortization of intangible assets (641)$ (641)$ Gain (loss) from discontinued operations 230,305$ (37,904)$ Total adjustments 229,973$ (39,126)$ Core income (loss) 30,906$ 5,953$ 419.2% per diluted share (CEPS) 0.71$ 0.14$ Net loss & LAE ratio 21.9% 56.3% Net expense ratio 48.6% 135.4% Combined ratio 70.5% 191.7% (121.2) pts Less: Net current year catastrophe loss & LAE 3.5% 11.4% Less: Net (favorable) unfavorable reserve development -3.6% -5.3% Underlying combined ratio 70.6% 185.6% (115.0) pts

 
Q1-23 Detailed Results 5 Pre-tax earnings from continuing operations of $40.4m soared +619% y/y. ¹ 2022 amounts recast for discontinued operations Includes non-recurring management fee income and operating expenses related to UPC that no longer eliminate in consolidation. $ in millions Q1-23 Q1-22 ¹ Change % Chg Gross Premiums Earned 144.4$ 122.7$ 21.7 17.7% Ceded Premiums Earned (57.1) (65.0) 7.9 -12.2% Net Premiums Earned 87.3 57.7 29.6 51.3% Investment & Other Income 16.2 60.5 (44.3) -73.2% Unrealized G(L) on Equities 0.5 (0.8) 1.3 -162.5% Total Revenue 104.0 117.4 (13.4) -11.4% Underlying Loss & LAE 19.2 29.0 (9.8) -33.8% Current year CAT Loss & LAE 3.1 6.6 (3.5) -53.0% Prior year development (F)/U (3.2) (3.1) (0.1) 3.2% Net Loss & LAE 19.1 32.5 (13.4) -41.2% Operating Expense 42.4 78.2 (35.8) -45.8% Total Expenses (excluding interest) 61.5 110.7 (49.2) -44.4% Earnings from continuing operations before tax 40.4$ 5.6$ 34.8$ 618.5% Net income from continuing operations 30.5$ 4.6$ 25.9$ 563.0% Direct Loss Ratio - Non-catastrophe 9.1% 21.1% -12.1 pts Direct Loss Ratio - Current year catastrophe 2.1% 5.3% -3.2 pts Direct Expense ratio 31.7% 63.7% -32.1 pts Net Loss Ratio 21.9% 56.3% -34.4 pts Net Expense Ratio 48.6% 135.4% -86.8 pts Combined Ratio 70.5% 191.7% -121.2 pts Less: Current year catastrophe loss & LAE 3.5% 11.4% -7.9 pts Less: Prior year reserve development (F)/U -3.6% -5.3% 1.7 pts Underlying Combined Ratio 70.6% 185.6% -115 pts

 
Q1-23 Segment Results 6 Commercial lines remained profitable despite the impact of reserve strengthening. Our Personal Lines (PL) segment is now limited to Interboro, and other affiliates focused on servicing PL related operations. PL net expense ratio includes all operating expenses but excludes service fee income in other revenue making the expense and combined ratios less useful. $ in millions CL PL Other Total Gross Premiums Earned 132.0$ 12.4$ -$ 144.4$ Ceded Premiums Earned (53.3) (3.8) - (57.1) Net Premiums Earned 78.7 8.6 - 87.3 Investment & other revenue 1.7 14.5 - 16.2 Unrealized G(L) on Equities 0.5 - - 0.5 Total Revenue 80.9 23.1 - 104.0 Underlying Loss & LAE 14.6 4.6 - 19.2 Current year CAT Loss & LAE 2.1 1.0 - 3.1 Prior year development (2.8) (0.4) - (3.2) Total Loss 13.9 5.2 - 19.1 Operating & Interest Expense 28.0 14.1 3.0 45.1 Total Expenses 41.9 19.3 3.0 64.2 Other income (loss) - 0.8 (0.2) 0.6 Income (Loss) before tax 39.0$ 4.6$ (3.2)$ 40.4 Income tax expense (benefit) 9.9 Net income (loss) from continuing operations 30.5 Net Loss Ratio 17.7% 59.7% 21.9% Net Expense Ratio 35.6% 163.2% 48.6% Combined Ratio 53.3% 222.9% 70.5% CAT Loss 2.7% 11.2% 3.5% PY Development (F)/U -3.5% -4.6% -3.6% Underlying Combined Ratio 54.1% 216.3% 70.6% Three Months Ended Mar 31, 2023

 
Balance Sheet Highlights 7 Stockholders’ equity and BVPS were restored to positive amounts upon de-consolidation of our former affiliate UPC. Mar. 31, Dec. 31, ($ in thousands, except per share amounts) 2023 2022 ¹ % Variance Selected Balance Sheet Data Cash & investments 372,721$ 340,905$ 9.3% Unpaid loss & LAE reserves 748,365$ 842,958$ -11.2% Financial debt 148,438$ 148,355$ 0.1% Accumulated other comprehensive income (loss) (25,629)$ (30,947)$ -17.2% Stockholders' equity attributable to UIHC 83,488$ (182,039)$ n/m Total capital 231,926$ (33,684)$ n/m Leverage Ratios Debt-to-total capital 64.0% n/m n/m Net premiums earned-to-stockholders' equity (annualized) 418.4% n/m n/m Per Share Data Common shares outstanding 43,274,359 43,280,173 0.0% Book value per common share 1.93$ (4.21)$ n/m Underlying book value per common share 2.52$ (3.49)$ n/m ¹ 2022 amounts recast for discontinued operations

 
2023-24 Projected Catastrophe Reinsurance Program - ACIC 8 ACIC is nearly complete placing its reinsurance tower meeting rating agency standards. 1st Event

 
2023-24 Projected Catastrophe Reinsurance Program - IIC 9 IIC is also nearly complete placing its reinsurance tower meeting rating agency standards. 1st Event

 
Cautionary Statements 10 This presentation contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward looking statements include expectations regarding our diversification, growth opportunities, retention rates, liquidity, investment returns and our ability to meet our investment objectives and to manage and mitigate market risk with respect to our investments. These statements are based on current expectations, estimates and projections about the industry and market in which we operate, and management's beliefs and assumptions. Without limiting the generality of the foregoing, words such as "may," "will," "expect," "endeavor," "project," "believe," "anticipate," "intend," "could," "would," "estimate," or "continue" or the negative variations thereof, or comparable terminology, are intended to identify forward-looking statements. Forward-looking statements are not guarantees of future performance and involve certain known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. The risks and uncertainties include, without limitation: the regulatory, economic and weather conditions in the states in which we operate; the impact of new federal or state regulations that affect the property and casualty insurance market; the cost, variability and availability of reinsurance; assessments charged by various governmental agencies; pricing competition and other initiatives by competitors; our ability to attract and retain the services of senior management; the outcome of litigation pending against us, including the terms of any settlements; dependence on investment income and the composition of our investment portfolio and related market risks; our exposure to catastrophic events and severe weather conditions; downgrades in our financial strength ratings; risks and uncertainties relating to our acquisitions including our ability to successfully integrate the acquired companies; and other risks and uncertainties described in the section entitled "Risk Factors" and elsewhere in our filings with the Securities and Exchange Commission (the "SEC"), including our Annual Report in Form 10-K for the year ended December 31, 2021 and 2022 and our Form 10-Q for the periods ending March 31, 2022, June 30, 2022, September 30, 2022, and March 31, 2023. We caution you not to place undue reliance on these forward looking statements, which are valid only as of the date they were made. Except as may be required by applicable law, we undertake no obligation to update or revise any forward-looking statements to reflect new information, the occurrence of unanticipated events, or otherwise. This presentation contains certain non-GAAP financial measures. See our earnings release, Form 10-K ,and Form 10-Q for further information regarding these non-GAAP financial measures. The information in this presentation is confidential. Any photocopying, disclosure, reproduction or alteration of the contents of this presentation and any forwarding of a copy of this presentation or any portion of this presentation to any person is prohibited.