Welcome to Assurance fourth quarter 2025 conference call and webcast. At this time, all participants have been placed in a listen-only mode and the floor will be open for your questions following management's prepared remarks. We ask that you please hold all questions until the completion of the formal remarks, at which time you will be given instructions for the question and answer session. It is now my pleasure to turn the floor over to Shawn Rozier, Vice President of Investor Relations. You may begin.

Thank you, Operator, and good morning, everyone. We look forward to discussing our fourth quarter and full year 2025 results with you today. Joining me for assurance conference call are Keith Demings, our President and Chief Executive Officer, and Keith Meyer, our Chief Financial Officer. Yesterday, after the market closed, we issued a news release announcing our results for the fourth quarter and full year 2025. The release and corresponding financial supplement are available on assurant.com. Also on our website is a slide presentation for our webcast participants. Some of the statements made today are forward-looking. Forward-looking statements are based upon our historical performance and current expectations and subject to risks uncertainties and other factors that may cause actual results to differ materially from those contemplated by these statements additional information regarding these factors can be found in the earnings release presentation and financial supplement on our website as well as in our sec reports during today's call we will refer to non-GAAP financial measures, which we believe are important in evaluating the company's performance. For more details on these measures, the most comparable GAAP measures, and a reconciliation of the two, please refer to the news release and supporting materials. We'll start today's call with remarks before moving into Q&A. I will now turn the call over to Keith Demings.

Good morning and thank you for joining us. 2025 was an exceptional year for Assurance, marking our ninth consecutive year of profitable growth. Our business model continues to outperform, supported by disciplined investment in innovation across lifestyle and housing businesses. These investments are delivering simpler, faster, and more consistent outcomes for clients and are reinforcing a strong foundation for long-term value creation. In 2025, we delivered another year of double-digit growth, including 11% for adjusted EBITDA and 12% for adjusted earnings per share, both excluding catastrophes. Including catastrophes, adjusted EBITDA and adjusted EPS grew 16% and 19%, underscoring the strength and resiliency of Assurant. At the core of that performance, and what truly differentiates us, is our people. Around the world, our teams show up every day with a relentless commitment to clients and customers. Their dedication continues to elevate our market leadership. I'm proud we were recognized on Forbes' World's Best Employers list, and we continue to be named amongst Fortune's America's Most Innovative Companies. These recognitions reflect a culture grounded in collaboration, accountability, and a drive to make a meaningful impact. Our results this year build on a multi-year track record of strong, resilient performance, highlighting earnings durability. Since 2020, adjusted EBITDA, excluding CATS, has increased by well over $700 million, representing an 11% compound annual growth rate. At the same time, adjusted EPS, excluding cats, grew to $22.81 per share, delivering a high teens compound annual growth rate. Over the last five years, we generated an average ROE of approximately 14% and a return on tangible equity over 30%. Together, our strong growth and financial return profile delivered a total shareholder return of 93% over this period. Turning to our operating segment highlights. In 2025, Global Lifestyle delivered mid-single-digit adjusted EBITDA growth, reflecting increased momentum in connected living and global automotive. We are positioning the business for additional growth by investing in innovation to expand programs and product capabilities for clients and end consumers. Across Connected Living and Global Automotive, we are transforming operations through our intense focus on technology, including artificial intelligence, to support clients, deliver efficiencies, and improve the customer experience. In Connected Living, adjusted EBITDA grew mid-single digits. Over the last two years, we prioritized investments that are delivering earnings growth and supporting expansion across client programs. In mobile, we added nearly 2 million protected devices over the past year through new programs and strategic wins. Today, we protect over 66 million devices globally. Subscriber growth remains strong, supported by the expansion of device protection programs globally, including with U.S. device protection clients who continue to win in the market. We also deepened key carrier partnerships this year. Early in 2025, we launched a new device protection plan with Verizon's fast-growing, no-contract wireless provider, Total Wireless. us. As previewed on our third quarter call, we expanded our T-Mobile relationship through a multi-year reverse logistics agreement and opened a dedicated state-of-the-art logistics facility. Looking to 2026, we see additional opportunities to grow with T-Mobile. We continue to be excited about the additional near-term opportunities within the reverse logistics space with other large U.S. mobile carriers. Together, these examples reinforce our role as a long-term strategic partner within the carrier ecosystem. In retail extended service contracts, we continue to build momentum across appliances and consumer electronics, including the expansion of our partnership with Best Buy to support their Geek Squad protection program. Following our third quarter announcement of this new program, program, we're now servicing the back book of existing protection policies, meaningfully increasing our scale as we focus on optimizing the program in the coming quarters. We also saw strong progress in financial services as we scaled our card benefits business with the completion of the first full year of our partnership with Chase Card Services, supporting benefits for millions of cardholders nationwide, and also recently expanding our relationship in the UK. This past year, Global Automotive also delivered mid-single-digit earnings growth in what was a significant year for the business. We expanded our presence with national dealer groups, third-party administrators, and OEMs, now protecting 57 million vehicles, nearly 2 million more than last year. After several key wins throughout 2025, we launched a new partnership with a top 25 dealer group in the U.S. and renewed a key national dealer partnership. We also accelerated progress in heavy equipment and lease and finance businesses, adding four new partnerships with heavy equipment manufacturers and renewing 10 agreements with key lending partners. Entering 2026, global auto is well positioned with momentum across major channels. Turning to global housing, adjusted EBITDA grew double digits, excluding catastrophes, with earnings surpassing $1 billion, more than doubling since 2022. This year demonstrated the differentiated profile of our specialized housing business, achieving a very strong underlying combined ratio of 80%, excluding favorable prior year reserve development. In homeowners, our lender-placed business continue to serve a critical role in the U.S. mortgage market. As the voluntary homeowner's market is hardened, more homeowners rely on lender-placed insurance to protect their homes. This drove a 5% increase in in-force policies year over year. During the year, we renewed four major lender-placed partnerships, representing more than 4 million loans tracked. We see clear opportunities to expand our market position in 2026. In renters, our technology-enabled services, including our Cover360 platform, continue to differentiate assurant in the marketplace. We delivered meaningful top-line growth and increased renters' policies by 15%, supported by onboarding a new portfolio that expanded our footprint and unlocks future growth potential. We reinforced our market position by signing several new PMCs and renewing key partnerships, including three of our top five partners. Overall, our market-leading positions in scale and housing allow continued technology investments, leading to attractive expense and combined ratios, while providing an exceptional experience for both our clients and customers. across assurant we executed against our priorities that remain central to our strategy this year we expanded offerings and attachment rates with existing partners won new clients globally and continue to invest in core markets where we see long-term value creation these examples show how leading with insight challenging convention and delivering with discipline help us and our clients win and redefine the boundaries of protection in the market we were excited to announce our new relationship with compass international holdings we recently signed a long-term agreement across six of their u.s real estate brands this launch expands our total addressable market in home protection and extends our reach directly into the real estate channel making assurance home warranty available to hundreds of thousands of affiliated agents across participating Compass International Holdings brands. We see a clear path to long-term leadership in home warranty, driven by three core advantages. First, we have a proven track record of executing successful channel expansion by partnering with market-leading clients and building solutions aligned to their strategic objectives. Within Assurant Home Warranty, we're applying the same highly collaborative operating model and senior-level engagement that enabled us to scale and differentiate our mobile business. As a result, we're already seeing growing interest across the broader real estate ecosystem and from existing assurance partners who view home warranty as a natural extension of their customer relationships. Second, we're leveraging our global capabilities at scale. We bring decades of experience managing service networks, underwriting risk, administering claims, and supporting customers across mobile, auto, and home protection. Our ability to integrate seamlessly into partner workflows reduces friction for agents and delivers more consistent, reliable outcomes for homeowners. Third, and most importantly, we deliver exceptional customer experiences. Historically, home warranty has been defined by complexity and inconsistency, creating friction for both homeowners and agents. We believe the market opportunity will grow by earning trust. Our solution is built around customer-first claims resolution and a nationwide network of service professionals focused on quality and reliability. Ultimately, we're bringing greater clarity, simplicity, and confidence, giving agents a solution they can stand behind and homeowners a reason to renew year after year. Taken together, these strengths reinforce our confidence in our path toward leadership and home warranty and our ability to scale over the long term. As we begin 2026, we expect increasing momentum in global lifestyle with high single-digit earnings growth anticipated for the year, and continued underlying strength in global housing. While we continue investing in home warranty and other strategic priorities, we expect to deliver strong underlying results as we execute our long-term strategy. Before turning the call over to Keith, I want to thank our clients for their trust and partnership, and the entire Assurant team for tremendous work throughout the year. Your dedication and commitment to excellence define who we are and position us for another strong year ahead. Keith, over to you.

Thanks, Keith, and good morning, everyone. 2025 was definitely another outstanding year for Assurance. Through the commitment of our teams, we executed on key priorities and reinforced our market-leading positions with strong financial performance across housing and lifestyle our performance was underscored by yet another exceptional year in global housing where we delivered 15 percent adjusted ebitda growth excluding reportable cats representing our third consecutive year of double-digit earnings growth within global lifestyle earnings grew across both businesses supported by new partnerships and programs in connected living, and continued loss improvement in global automotive. At the same time, we invested in partnerships to drive value for all stakeholders, advancing our innovation roadmap and strengthening product differentiation as we leverage global technology to create customized new products and unlock new growth paths. This was capped off by our entrance into the attractive home warranty market where we see a path to market leadership. We're excited about our trajectory heading into 2026. Before getting into this year's outlook, let me start by highlighting our fourth quarter results, beginning with Global Lifestyle. Fourth quarter adjusted EBITDA increased 2% compared to last year, with year-over-year growth impacted by an unfavorable $7 million non-run rate mobile inventory adjustment in connected living. Excluding this item, Global Lifestyle's underlying adjusted EBITDA grew 6%, or $11 million. Within Connected Living, underlying EBITDA growth was 7%, or $9 million, led by global mobile device protection programs and modest growth in mobile trade-in programs. The strength of our mobile device protection programs was supported by subscriber growth across the U.S. and with our international clients. In global trade-in, we continue to see higher contributions across U.S. mobile partners. Our trade-in and reverse logistics business has benefited from the use of robotics and AI to assess mobile device quality and process trade-ins with greater speed and consistency. This has presented a powerful opportunity at facilities like our Innovation and Device Care Center near Nashville to support higher average selling prices and create more value for our clients and end consumers. In global automotive, adjusted EBITDA increased 3%. Prior rate increases and enhancements to claims processes continue to improve loss experience. Our guaranteed asset protection, or GAAP product, also improved in recent quarters as we proactively reduced claims risk. For global lifestyle, our net earned premiums, fees, and other income grew 7%, primarily driven by connected living growth from mobile protection and trade-in programs, and the recent launch of our partnership with Best Buy to support their Geek Squad protection program. Moving to global housing, fourth quarter adjusted EBITDA was $276 million, including $9 million of reportable catastrophes. Excluding CATS, adjusted EBITDA increased 3% to $285 million. dollars. After considering impacts of lower prior period reserve development, underlying growth was eight percent. Results benefited from continued top-line growth in Lender Place due to higher enforced policies and average premiums. Specialty products, including our manufactured housing business, also contributed to growth. Finally, our liquidity position at year-end was $887 million, dollars providing flexibility to continue to invest in growth return capital to shareholders and support future opportunities this quarter we returned 138 million dollars to our shareholders including 94 million dollars of sherry purchases and 44 million dollars in dividends this brings our 2025 sherry purchases to 300 million dollars ending at the top end of our expected range as we enter 2026 with an attractive valuation we've repurchased an additional 30 million dollars through february 6th we'll continue to evaluate the best uses of capital using a disciplined and balanced approach during 2025 we completed four small acquisitions to enhance our products and capabilities this included the fourth quarter acquisition of RL Circular Operations, a reverse logistics division of TIC Group based in Australia and New Zealand. This acquisition will help us bolster our reverse logistics capabilities through AI-based technologies, which we'll look to deploy across other regions. Additionally, in November, we increased our dividend by 10%, marking our 21st consecutive year of increases. Let's move on to our outlook for 2026. We expect full year adjusted EBITDA and earnings per share to be consistent with 2025 levels, both excluding CATS, given the $113 million of favorable prior year reserve development within our 2025 results. Excluding this impact, we expect mid to high single digit growth in both adjusted EBITDA and earnings per share, excluding CATS. To deliver these objectives, we expect to generate EBITDA growth of over $130 million, overcoming the $113 million of 2025 prior year development, and incremental investments for Assurant Home Warranty in 2026. We expect Global Lifestyle to lead the underlying growth of the enterprise with high single-digit earnings expansion. Connected living growth is expected to be driven by continued optimization of new programs, expansion with existing clients, and contributions from recently announced new programs and capabilities. Global auto is expected to grow from higher investment income, continued loss improvement, and growth of global partnerships. Turning to global housing, we expect solid underlying growth, excluding the favorable 2025 prior year reserve development of $113 million. Consistent with our past approach, our 2026 outlook does not contemplate additional prior year reserve development. In lender place, we expect growth to be driven by higher track loans from expected new client wins and the continued hardening of the voluntary homeowner's market. From a placement rate perspective, we anticipate some quarterly fluctuations from and client loan movements during the year. For our 2026 Catastrophe Reinsurance Program, we are currently working through the placement, which will be effective on April 1st. Overall, we expect a similar structure to our 2025 program, maintaining robust coverage at both the top and bottom end of our program. Our annual CAT load assumption for this year is estimated to be between $180 and $185 million. We'll provide additional information on the program on our may earnings call for corporate we expect an EBITDA loss of approximately 140 million dollars which includes incremental investments related to assurance home warranty we currently expect this to be our most substantial organic investment across assurance in 2026. from a capital perspective strong cash generation creates flexibility enabling us to reinvest for growth including M&A and return excess capital to shareholders after a strong year of repurchases we expect our 2026 repurchases to be in the range of 250 million to 350 million dollars subject to M&A as well as market and other conditions this represents an increase from last year's range of 200 million to 300 million dollars demonstrating the confidence we have in business growth and our ability to generate meaningful cash flows our full year results and financial performance commercial momentum and our outlook for 2026 reinforce the strength of our businesses and the value we bring to all of our stakeholders with that operator please open the call for questions thank you the floor is now open for questions if you'd like to ask a question please click on the raise hand button which can be found

on the black bar at the bottom of your screen when it is your turn you will receive a message on your screen from the host allowing you to talk and then you'll hear your name called please accept unmute your audio and ask your question we will wait one moment to allow the queue to form our first question comes from charlie letterer at bmo please unmute your line and ask your question.

Morning, Charlie. Morning. Hey, good morning. All right. I guess I wanted to start with, I know you don't like to anchor to the written premium KPIs, but I wanted to kind of understand the connected living growth in the context of the guidance. So we can see the written premium growth accelerated in connected living to 48% from 21% last quarter and 9% the quarter before that. But guidance for the lifestyle segment is mid to high single-digit EBITDA growth. Can you help us unpack that? What's offsetting the premium growth? Is it slower earn-in of the premium? Is it growth in lower margin business? Or are there underlying investments offsetting that premium growth? Thanks.

Yeah. Great. Maybe I'll start with a couple of high-level comments and then Keith Meyer can jump in. I mean, I think we are pleased as we look at 2026 certainly relative to the overall outlook, but in particular with the lifestyle growth leading the organization next year. We do expect growth in both connected living and auto. So that's really, really good to see. and obviously coming off of mid single digit in both businesses this year and you're right i mean we've had a lot of investment in the business we've launched a lot of new client programs we're scaling results and you've seen a lot of growth in uh subscribers 2 million subscribers up year over year so that trend line continues as we head into 26 and certainly a big driver of the company's success and growth but maybe keith more specifically on the revenue side Yeah, and I think we certainly have the momentum on the revenue side.

You mentioned, is there an earnings aspect to that? And a lot of that, especially in the fourth quarter, as we've expanded our extended warranty business, does have multi-year contracts in it. And we've brought on a book as well during the fourth quarter. So I think you'll see that, you know, earning through over the next couple of years. And I think it also just is another example of why we have the confidence to say that our lifestyle business will lead the growth into 2026.

Thanks. And then maybe just on the outlook for PYD. I know you guys don't put it in your guide, but how are you feeling about, I guess, you know, reserve confidence in housing and, you know, have some of the tailwinds that have boosted that, you know, KPI over the last couple of years? Is that still there or any color there?

Yeah, I think we're we feel very good about the reserve position we're in in our housing business. um and so you know i think that's where it's hard to predict where that will come in into next year but we certainly feel good about the reserve position as of the end of the year and and certainly we'll we'll share more as that that evolves throughout the next few quarters yeah maybe i'll add a couple of of comments i think um in into your point we've had favorable development the last couple years you know really pretty consistent in 24 and 25 when you look at the underlying growth in housing year over year.

It's certainly double digit, you know, with and without considering PYD. So we're incredibly proud of how this business has performed. Talk about a business growing from just over 400 million in 2022 to over a billion in 2025. It's truly been remarkable. And as we think about next year, and this is probably the important message, setting aside the PYD, strong underlying growth continues. We see loan growth, policy growth, AIV increases over the year, probably a relatively neutral rate environment, and low to mid-80 combined ratios for the year in 2026. So we're really proud of the business and how it's proven to be so resilient the last few years.

Thanks. And I guess just one other follow-up. I think Keith Meyer mentioned you know continued hardening of the traditional home insurance market um i guess have you seen any signs of that trend abating um i guess is that concentrated in specific geographies or you know i think that's somewhat countered to some of the messaging in the market so so we'd love to hear more of your thoughts there thanks yeah sure what we've seen uh most recently is a similar trend to what we saw throughout last year, where we're growing certainly in California.

We're also growing in the Midwest as well. And then that's actually offset a little bit by where in Florida, it was flat to maybe a little bit down in Florida. So overall, we are seeing the overall mix being positive. And not only that, but the places where we're getting the growth are very good for our overall long-term stabilization and how we think about not having as much risk in Florida. So we're really happy with the way the business is growing.

Thanks. Thank you.

Our next question will come from Jeff Smith with William Blair. Please unmute yourself to ask your question.

Morning, Jeff. Good morning, Keith and Keith. Question on the home warranty business. Could you discuss the size and cadence of investments that you're planning for that business in 26? And was there much invested in 25?

Sure. Yeah, and we had signaled at the third quarter that, you know, the delta in terms of the increased expectation in 25 in the corporate line was driven by some of the investments in in-home warranty, which started to scale as we went through the year. I would signal, you know, probably 15 to 20 million of incremental invest in 26. You see that showing up in the corporate line is 140. In 26, it was 124 this year. So that gives you a sort of an order of magnitude of the investment we expect. And, yeah, we're super excited about this opportunity. It's a great long-term growth vector for the company. I think we're incredibly well positioned and to be launching our solution with a market leader as we're doing, I think, is is incredibly exciting for us.

OK, great. And then one more on on home warranty. You know, what geographies are you starting in there and then how have you gone about, you know, sort of building out the contractor network and Salesforce there? Is it all new third party contractors? Like how many sales agents did you hire? Thanks.

Yeah, so we're in the early rollout phase, I would say. We're rolling out across six brands. These are the Legacy Anywhere brands, Coldwell Banker, Century 21, Sotheby's, Corcoran Homes, ERA, and Better Homes and Gardens. and we're in the process of rolling out as we speak to all of the affiliated agents across the country. We're rolling out nationally. We're seeing sales come through every day and it's obviously going to grow as we continue to get the word out. We're deeply integrated into the buy flow, the transaction flow with our partners and we feel really excited about the opportunity and we've been investing in this business for a long, long time. We build service networks for a living. We serve connected homes. We serve appliances. We've historically done some work in the home warranty arena. I think there's a great opportunity. We're incredibly good at leveraging technology, building out service networks, aspiring to raise the bar around customer experience. And that's exactly what our client is looking for. And that's exactly what this market is looking for.

Okay. Great. Thank you.

Our next question comes from John Barnage with Piper Sandler. You may now go ahead with your question.

Hey, John. Hey, good morning. Thank you for the opportunity. My first question, if we can maybe stick on home warranty, is that 140 a new level we should be thinking about with the business located in corporate, or do you think there's a reversion lower in the corporate loss beyond 26 in the investment period? Thank you.

Yeah, so I think you can think about it for this 2026 year, John, and then as the business scales, that's going to evolve. Hopefully, we can even invest more by adding more clients on as well. But as it stands now, we would be investing in 26 and then obviously growing that business over the coming years. And we have a long-term agreement. Typically, our agreements are three to five years.

This is beyond that. so this is a long-term uh view of how we're looking at this market and we're super excited about the the entry we have with uh you know with a leader in real estate thank you very much uh and my next question is on the outlook i understand it excludes cat losses you give us an estimate for that it also excludes favorable reserve development and maybe going back to an earlier question can you remind us on a per share basis how much favorable reserve development helped earnings in 25 and what that would be, what that $22.81 would be x that 25 favorable reserve development. Thank you.

Yeah. So I think the way to think about it is we had the 113 million of prior year development. And I think that's the part where we see strong underlying growth, But we do expect it to decline a little bit in relation to the 113, but the underlying growth being very, very strong. And then I think when you think about the overall company in terms of our outlook, we're overcoming the 113 million of prior year development and the investments that Keith mentioned in home warranty, you know, those total $130 million. So that's the way that we combine those in terms of how we view being consistent with last year overcoming $130 million, John.

It's very helpful. Thank you very much, Keith. My last question, a lot of your distributions, B2B2C ultimately. Can you talk about AI, how you're incorporating that in your business, not just to drive greater margin, but ultimately actual top-line growth?

Thank you. yeah i mean i think you know our as you mentioned our business model is unique we're obviously a highly specialized provider and we're embedding into the transaction flows of our clients really across almost every product line which is a fantastic position to be we're really operating as an extension of clients and i think for us ai is a is a huge opportunity right whether it's driving customer experience improving efficiency you know across the board operationally but also in every department in the company, and then adding more personalized service, how we think about personalizing products to target the interests of individual consumers, and then how we customize service delivery on a more personalized level. So there's a tremendous amount of opportunity, and a lot of it is all about how the customer is getting served. But Keith, anything you would add?

Yeah, I think we're using it across multiple areas. When you think about driving revenue we're we're using it to improve our products think about things like premium technical support where we're able to infuse ai to make that experience for the customer even better in auto we're actually helping our dealers to be able to sell better so that's helping us in that revenue keith mentioned operationally it's been very meaningful to us And then even in our device care centers where we utilize robotics and AI to process our mobile phone devices, you know, you can see how we infuse AI across all of our businesses.

Thank you. Welcome.

Our next question comes from Mark Hughes with Truist. Please unmute yourself to ask your question.

Morning. On the home warranty business, when do you think it'll be material enough, I guess, to move out of the corporate and into connected living?

Yeah, it's a great question. Hopefully sooner than later, obviously. But I think we're early, early days, right? We just put out the announcement this week. We're super excited. It's a great opportunity to drive growth. We'll shed more light on the progress as we get a couple of quarters under our belt, see what the sales volumes look like. And then at some point, it probably does move out of corporate. Right now, I think it makes a lot of sense. It's being led by our chief innovation officer who used to lead the connected living business, really drove our entry into the mobile space. We're trying to rerun that playbook. I think it's a pretty exciting moment and it will move back into lifestyle at some point in the future and you said uh there's some interest from uh your other partners perhaps in uh the warranty business could you expand on that you know which uh categories are we talking about um and what uh yeah i probably i probably won't i probably won't tip our hand too much in terms of the competitive market but what i would say is um what we're trying to do in this space how we're thinking about coming to market with our products and services, how we're trying to address pain points, and then aligning with clients. We're incredibly good at B2B partnerships and having that partner mindset in everything we do. We operate with incredible transparency, and I think our clients are really interested in doing more around home warranty. So we've had quite a number of conversations across real estate and also with many of our affinity partners, And I definitely think there's a long-term place for assurance in this marketplace in multiple different ways.

Yeah, I think we're pretty optimistic about the opportunities we have ahead in home warranty. You know, Keith mentioned the progress we had made on mobile from the early days to today. You know, it reminds me also of how we entered into Japan, where we were able to align with one of the market leaders in Japan. and that became a very successful business for us, similar to home warranty, leveraging our global capabilities and technology. And now Japan has a lot of growth opportunity for us over the long term, and we think home warranty will be another growth factor for us as well.

And then in connected living, is revenue gonna grow faster than EBITDA or slower than EBITDA?

That's a great question. And I think what I what I would say is, you know, we do see high single digit EBITDA growth in lifestyle, strong contributions across connected living and auto. Obviously, we've had really nice revenue growth broadly, but I'm excited to be in the high single digit growth range for that business. And we've got a ton of momentum and a lot of opportunity.

And then just a final one, if I can squeeze it in, you'd mentioned reverse logistics with other large carriers. Would that be a new relationship, or is that the one you've already talked about previously?

It would be something that we'd talk about more broadly in the future. You know, we're super excited with what we've built with T-Mobile. We highlighted it in the third quarter. We put a little more finer point on it this quarter. This would be with an additional client. We're doing more work around this category. it. We'll likely share more hopefully in May, I would think, on the next earnings call. But this is another place where I think we're creating market advantage, we're leveraging technology, and there's a lot of opportunity to embed more deeply in the mobile ecosystem.

Thank you very much.

Matt, thank you.

Our next question comes from Tommy Nick-Joyne with KBW. Please go ahead with your question. Hey, Tommy.

Hey, good morning, guys. Thanks for taking our questions. Um, maybe the first one on the global housing side, um, a number of state regulators, you know, have announced sort of the exploration of profit caps. Um, do you have a preliminary sense for, you know, whether or not any of those proposals could, could impact your, your business, for instance, in a, in a state like New York, that's been pretty vocal about it.

Yeah. I think the one thing that we feel good about Tommy is, you know, we do regular rate filings with all of the states. And that's a very, very formalized process. There's a, you know, a minimum requirement to file every certain number of years. If losses and the profitability metrics are too favorable, then we file sooner. So I do feel like we're really well positioned. There's a lot of regulatory scrutiny over the top of the lender place product. It's obviously very different from voluntary homeowners it's serving a very different purpose in terms of what it's protecting and when it's valuable so i do feel like we're in a in a good place with the product overall but keith anything you'd add no i think that's the key is the the fact that we are regularly in dialogue with each state and doing the regular filing so um you know there really aren't any surprises going on when when you're doing that okay got it um and then maybe a big picture one here.

I want to just check in kind of what you guys are doing to making sure that you're staying on the forefront of what's happening sort of with the evolution of connected devices. You know, you've done a great job, obviously, on the smartphone, the mobile device.

But to the extent that we see, you know, AI become more infused in other devices, you know, whether it be smart glasses or earbuds or, you know, anything in the home, what are you guys doing to make sure you're staying on the forefront of being involved and integrated in the evolution of that technology yeah i think you know first of all i think we provide protection around you know all consumer electronics and technology products and as those products evolve we're evolving our protection accordingly you know i think about the example we gave on what we're doing with t-mobile and in Texas is a great example where we're taking back all device types in our facility. So that's wearables, hearables, cases, cables, screen protectors, et cetera. So we're evolving as the client's categories are shifting and making sure that we're able to process devices, that we're able to dispose of them appropriately, resell them, and obviously repair them. So I think we're really well positioned.

And this is what our team, we've got a lot of engineers that are constantly working with our clients to make sure we're fit for purpose yeah and i think when you you know when you consider we partner with the largest mobile player the largest consumer electronics player the largest appliance uh seller you know we're we have deep uh r d that is seeing all these products um real time and ahead of time as as we're preparing to be able to outline the coverages that we would want to have for those products. So the nature of being able to be working with market leaders at the forefront of each of these industries, Tommy, I think is a powerful advantage for us.

So you guys know what OpenAI's new rumored hardware device is? You guys have an inside scoop on that?

Yeah, you'll have to ask your AI assistant.

Great.

Thanks, guys thank you appreciate it our next question comes from bob long with morgan stanley you may go ahead with your question morning hey bob hey this is dan on for bob can you guys hear me hey dad hi dan yes yep hi awesome uh great yeah hi good morning uh yeah i guess my first question would be on i kind of wanted to ask about uh global lifestyle um you guys mentioned high single digits for for 2026 for global lifestyle um how much of that earnings profile for this segment could we uh i just wanted to see ask maybe for that high single digits for 2026 how much of would come from like new partnerships or issuance of new policies versus um margin improvements uh so how are you guys thinking about that would be my first question yeah that's great i think you know when we look at lifestyle overall at high single i would say a couple of major drivers number one like we saw in 25 we're going to see mobile device protection subscriber growth we had

2 million subscriber increases this year, that trend line will continue into 2026. We also see great opportunity to optimize the new programs that we've launched and scaling the results from some of the investments we've made. So we've made a lot of investments in the business in 24 and 25, launching new programs that will mature and that will definitely be a big contributor to the profitability improvement. We've got continued momentum in auto as we get earned through from the rate increases and all the work that we've been doing on the claim side and then we've got broad expense discipline that's contributing as well so I think those are probably the big drivers in 26.

Great yeah thank you and I guess my final follow-up would be on lastly home home warranty as like as the business gets built out I guess I wanted to ask just overall your long-term aspirations for this product line and how that in terms of growth and earnings profile and how how that might impact your overall earnings profile or margin profile for connected living?

Yeah, I think our aspirations, as you'd expect, are to be the market leader. Where we typically get into categories and we always say we want to be aspiring to be number one. You know, in some cases, we're settling to be number two. We don't want to be a distant player in a fragmented market. We want to be a leader and we want to define the market. And I think that's what we're going to try to do in the real estate sector and more broadly in home warranty. It's a phenomenal market, had some incredible conversations with a variety of different clients and prospects, and it does feel like Assurance can make a difference in this space. So I'm super excited.

And I think it's got a good margin profile, you know, long term if we look at that industry. So, you know, we see it being a meaningful contributor over time, you know, similar to the other businesses we have in Global Lifestyle.

Awesome, guys. Thank you so much. Thank you.

Our next question comes from Dan Luckpano with Dowling Partners. Please unmute and ask your question.

Morning, Dan. Hey, guys. Can you hear me? Yep. Okay. Hey, guys. I don't mean to beat a dead horse, but on the home warranty business, I guess one more question following up on Dan's question. Who are the main competitors in that channel? How fragmented is the market? Is there a big player that you're looking to replace?

I mean, the largest player would be front door with American Home Shield, but there's probably 10 or 20 different players across the market, and it's pretty fragmented. So there's a lot of opportunity, and I think there's a lot of long-term white space to actually grow the overall category, to not just take share, but to grow the category as well.

Yep. And by the way, Dan, it's okay to ask more questions. We're pretty excited about our entry into home warranty as well, the way we've been able to launch with the market leader.

Great. Thanks. And any opportunities outside the real estate channel, maybe in retail going forward, you think that's an attractive market as well?

Yeah, I think we'll look to work with potentially affinity partners. We do business with a lot of companies, as Keith mentioned, across a variety of industries that relate to the home.

So they'll certainly be opportunities to explore that and you know we've got the kind of deep partnerships with clients where you know they're always interested in new ideas so there'll be definitely more of those conversations to come great and and one more question if i may um i just i wanted to get some color from you on the items that you put below the line uh in the quarter the 29 million restructuring costs and the loss on subsidiary health for sale of 11 million uh just curious if if you have any, if you can add any color on that.

Yeah, so on the restructuring, that was basically about a quarter of that was related to optimizing our real estate, Dan. Then we're also, there's some role reductions in there that optimize our resource model to really drive operational efficiencies and automation as well. But overall, I think it's important to do these things to then, you know, drive and fund important investments like home warranty, like our AI investments. And so, you know, I think it really sets us up to be putting our dollars to where it's going to make a big impact for us long term. And then I think you mentioned there's a subsidiary sale as well. That's basically an entity that has some old long-term care legacy business that is reinsured to well-rated counterparties. But I would say that is really another example of us fine-tuning our business portfolio to really focus on being the number one or two player in each market we serve.

And, you know, being able to have that part of that particular entity being sold, I think, just allows us to continue to focus more on so many great opportunities we have thanks for the caller you're welcome thank you our final question today is coming from charlie letter with bmo you may now ask your question charlie welcome back thanks uh thanks can you hear me i i've got the uh okay you can hear me right yeah okay sorry um just going back to my question on the the hard market in housing um you know appreciate the growth coming from california

in the midwest i guess in the in the midwest is that growth more coming from you know hard market dynamics or is it is it new partnerships um or something else and i have one more follow-up thanks yeah yeah i think i think it's a little bit of the the hard markets i think it's also a reflection of the mix of the portfolios that we have as well, Charlie. So I would say it's a combination of both of those things.

Okay, thanks. And then I'm a share repurchase guy. I appreciate the growth year over year. I guess when I look at the access liquidity you're holding, it's at the highest level it's been in a while.

I guess what's keeping you guys from having upside to that, you know, from having a wider range or a higher end? yeah no and i appreciate you uh asking about our strong capital position you know we're really pleased uh with where we are you know holding 887 million um at uh at the end of the year um you know and i think it really puts us in a position charlie to to be on offense which is exactly where we want to be you know we've we've mentioned that we and we also increased the the share repurchases over last year's guidance. So we feel good about that. We also increased our dividend last quarter by 10%. So we're certainly making sure that we're returning excess capital to shareholders. But certainly our biggest priority is being in a position to drive growth organically. We talked about investments we're making organically, as well as doing M&A, where we can really accelerate some of our strategy. So we feel great in terms of the position we're in, and we're in a position to take advantage of opportunities that present themselves.

Thanks, guys.

Very good. All right, thanks, Charlie. And I think that wraps us up. So thank you, everybody, for joining the call, and we'll look forward to the next call in May. Thanks, everybody. Have a great day.

Thank you.