Good morning and thank you for joining us today. This morning, Donegal Group issued its first quarter 2022 earnings release outlining its results. The release and the supplemental investor presentation are available in the Investor Relations section of Donegal's website at www.donegalgroup.com. Please be aware that statements made during this call that are not historical facts are forward-looking statements and necessarily involve risks and uncertainties that could cause actual results to vary materially. These factors can be found in Donegal Group's filings with the Securities and Exchange Commission, including its annual report on Form 10-K and quarterly reports on Form 10-Q. The company disclaims any obligation to update or publicly announce the results of any revisions that they may make towards any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. With that, it's my pleasure to turn it over to Kevin Burke.

Thank you, Karin, and welcome everyone. I will focus my remarks on the progress that we've made on several strategic initiatives. Jeff Miller will then provide details on our key financial results for the first quarter of 2022. Jeff Hay will then highlight our commercial and personal lines segment results, followed by Tony Viozzi with an update of our investment portfolio. I will then return for some closing remarks before we address the questions that were submitted to us in advance. We continue to make solid progress in modernizing our systems and transforming our business. The new operating platform we have implemented for our workers compensation and our new personal lines products increases our ability to be nimble and pivot quickly to respond to changes in the marketplace. Leveraging the new technology will continue to provide opportunities for increased efficiencies and customer experience enhancements. And we look forward to bringing additional products onto the new platform over the next few years. The successful launch of our new personalized products in six states is a great example of how the new systems are enabling our ongoing business transformation. While we remain diligent in our strategic emphasis on commercial lines and emphasizing growth, we are pleased to report modest growth in our personal lines premiums for the first time since the onset of our strategic plan to restore personal lines profitability starting back in 2018. In addition to the rollout of our new products with significant enhancements in our pricing segmentation and capabilities, we launched the new personal lines agency portal that integrates third-party data providers to pre-fill information, giving us additional underwriting insights and further enhancing the user experience for our agents. We view our strong relationship with our independent agents as a key component to our continued success. Whether we're working directly with an independent agency or building relationships with large national agency groups, our mission remains the same: to deliver real value to our agents by being highly accessible and responsive to them. Testing and building upon the Donegal franchise value for our agents is and will always be a focal point for us. Part of that mission is finding ways we can help our agents and agency groups grow their books of business with us for our mutual success. We have added dedicated team members to work with national agency group leaders and their affiliate agents to further enhance our opportunities for profitable growth in the years ahead. Since implementing our enterprise analytics unit back in 2019, we've made excellent progress in enhancing our capabilities to capture and utilize data to improve our operating results and stay attuned to market developments. The exponential increase in our use of data has truly changed our operating routines and has greatly enhanced our ability to forecast the future impact of actions we've implemented to support our strategic and business plans. We will continue to add expertise and make capital expenditures as required to further leverage data to help us effectively navigate challenging economic conditions and drive further improvements in our overall operating results. At this point, I'll turn the call over to Jeff Miller for a review of our financial results for the first quarter.

Thank you, Kevin. We are pleased with the solid premium growth and underwriting results we achieved in the first quarter of 2022. For the first quarter, net premiums earned grew by 6.4% to $199 million. I'd like to remind you that starting in January 2021, we began to include the commercial business from our Mountain States region in the underwriting pool, and those additional premium writings in 2021 will contribute to increases in net earned premiums throughout 2022. The overall combined ratio was 95.8% for the first quarter of 2022 compared to 98.5% in the prior year quarter. The solid underwriting results reflected continued net favorable development of reserves for losses incurred in prior accident years, lower weather-related loss activity compared to our five-year historical average for the first quarter, and a lower quarterly impact of large fire losses that we experienced on average during 2021. These favorable trends were partially offset by inflationary pressures on loss costs in certain lines of business. There were no unusually severe weather events or conditions in our operating regions during the first quarter of 2022, with weather-related losses totaling $8 million or approximately $2 million lower than the previous five-year first quarter run rate and representing four percentage points of the loss ratio. The non-weather loss ratio improved 480 basis points, reflecting a lower incidence of large fire losses and favorable prior year loss reserve development during the period. Fire losses over $50,000 totaled $9.6 million or 4.8 points of the loss ratio, compared to $10.3 million or 5.5 points of the loss ratio for the prior year quarter. The decrease was largely due to a lower frequency of large commercial fires, as we had only two fire claims in excess of $500,000 compared to eight in the prior year quarter. Conversely, there were six homeowner claims in excess of $500,000 in the first quarter of 2022, compared to only one in the prior year quarter. Net development of reserves for losses incurred in prior accident years of $16.5 million reduced the loss ratio for the first quarter of 2022 by 8.3 points compared to $8.2 million or 4.4 points of the loss ratio for the first quarter of 2021. Our insurance subsidiaries experienced favorable development in all lines of business in the first quarter of 2022, which has been a consistent trend over the past several years. We were especially pleased that we experienced $6.1 million of favorable development in our commercial auto line of business— a line that we've been diligently working to build up reserves and restore rate adequacy for several years. That favorable development generally resulted from lower-than-expected emergence of claim severity that we projected for accident years 2021 and 2020. We also had $3.6 million of favorable development in personal auto, which was primarily in the 2020 accident year when the pandemic conditions disrupted our historical loss patterns. The majority of the remaining favorable development was spread across commercial multi-peril, workers compensation, and other commercial lines. We increased our actuarially determined reserves during the quarter to reflect additional exposures, particularly those related to the additional Mountain States exposures included in the underwriting pool. The expense ratio was 35.8% for the first quarter of 2022, compared to 34.1% for the first quarter of 2021. We primarily attribute the expense ratio increase to higher underwriting-based incentives for our agents and employees, as well as technology systems-related expenses associated with our ongoing systems modernization project. From a capital perspective, we did not declare any dividends in the first quarter of 2022, which follows our historical practice. We announced during our annual stockholder meeting on April 21st that our Board of Directors approved a 3.1% increase in our quarterly Class A dividend rate to $16.5 per share and a 3.5% increase in our quarterly Class B dividend rate to 14.75 cents per share. And we declared a quarterly dividend payable on May 16th to stockholders of record on May 2nd. With that, let me turn it to Jeffrey, to provide more details about our commercial and personal lines results.

Thanks, Jeff. It’s a pleasure to be on the call today. So I'd like to start with commercial lines, where our net premiums written increased 1.7% overall. We experienced growth in all of our lines of business, except for workers' compensation, where the ongoing mandated rate reductions that the industry is experiencing continue to reduce our premiums as well. And while the 1.7% growth rate is modest, we did achieve our written premium goals for the quarter, primarily as a result of both improved rate increases and strong retention rates. Our strategy was to deliberately slow the writing of new business compared to the first quarter of 2021 to give us time to increase premium rates to maintain pace with the inflationary increases in loss costs that we're experiencing. However, our new business growth was even lower than we projected, and we're receiving some agency market feedback that general shopping activity is down in the market, as well as talent shortages within agency plans themselves being particularly impactful to agents’ abilities to pursue new business. We did see higher new business volume later in the quarter, and we're optimistic about those improving trends. More than offsetting the shortfall on new business, premium retention remains strong, holding within the low to mid-nineties range with renewal rate increases averaging 8.2% excluding the workers' compensation line of business. The achieved increases were fairly consistent across the lines of business and policy size bands. Also beginning in 2022, we're refining our rate strategies to deliver enhanced renewal price and guidance to our underwriters, allowing us to pursue higher rate increases on the most underpriced accounts to further improve margins. We began this approach in our commercial auto line of business and expect to roll this enhanced guidance for other commercial lines throughout the remainder of the year. The all-in commercial lines statutory combined ratio for the first quarter of 2022 was 93.5%. That compares to 99.3% for the prior year quarter, despite the improved loss ratio in each of the major lines of business within commercial lines. Again, due to relatively favorable weather and the lack of multi-million-dollar stock losses during the quarter, inflation continues to impact our results. Claims severity increased compared to last year for nearly every major line of business, and we're seeing increases in cost as well as a longer duration of repairs due to supply and labor shortages in the marketplace. Claim frequency was largely in line with historical averages, with the exception of commercial auto, where frequency continued to revert closer to pre-pandemic levels. Because of these trends, we will continue to execute our pricing and rate strategies throughout the remainder of the year. I did want to call out the commercial auto combined ratio, which is unusually favorable at 89.1%, reflecting a low incidence of severe losses and the impact of the favorable reserve development that reduced the loss ratio for that line of business by 15 points. While we do not expect to sustain that combined ratio going forward, we believe our commercial auto performance will continue to reflect the benefits of earned premium rate increases in the various strategic actions we implemented over the past several years to improve the profitability of that line of business. So thinking somewhat deeper into commercial lines, we are taking a number of actions as part of state-specific strategies for each line of business. After careful evaluation, we developed a commercial lines strategic posture for each state, ranging from a strong pursuit of growth to aggressive profit improvement where needed. Tactical plans were developed for 2022 based on the strategic posture we assigned to each state. Early execution of these strategies has been successful thus far in 2022, with states identified as attractive markets growing at more than twice the average segment growth rate and generating lower than average loss ratios, versus those states identified for profit improvement, shrinking by as much as double-digit percentages while also showing significant loss ratio improvement. While we believe these strategic geographic shifts within our overall commercial portfolio will help accelerate and sustain favorable loss results, we continue to promote growth in our targeted markets and reduce exposures in underperforming markets. To further support the strategic efforts, we recently implemented a new operating structure in commercial lines with two components that I would like to share. We formulated a new corporate underwriting function to focus more intently on the underwriting of larger accounts and specific industries. This group of specific industry and subject matter experts will support our underwriters in evaluating more complex risks. Secondly, we're in the process of centralizing our underwriting operational support teams to drive efficiencies and effectiveness in order to take advantage of the automation opportunities provided to us by our new policy administration systems. As we announced in mid-April, we have hired Matt Hudnall as our new Senior Vice President and head of commercial lines to lead this new operating structure. Matt has a breadth of experience that will bring new perspectives to our already successful commercial lines operation, and he has a proven track record of driving transformative change with a focus on independent agency relationships and customer experience. Moving onto personal lines, our overall premium growth was slightly positive in the quarter for the first time in recent memory, and we're pleased with the 94.8% combined ratio for that segment. Thanks to the successful launch of our new product suite in Indiana, Ohio, and our flagship state, Pennsylvania, in late 2021 and early 2022, we have significantly increased new business production for those states for the first quarter of 2022 compared to the same period last year. We've launched these new products in three additional states for policies effective in the second quarter, and barring any regulatory approval delays, we'll roll them out in the remaining four states later this year. We continue the rollout of the new personal lines products suite, and we are also diligently maintaining profitability within our legacy renewal book of business. Policy retention averaged near 90% across both personal auto and home, and we achieved rate increases averaging nearly 6% to help offset the inflationary pressures on loss costs. We have at least two planned rate change revisions during 2022 in each of the ten states where we're offering personal lines and expect the rate to build throughout the year. Our personal auto combined ratio of 93.5 was favorable but did benefit from 8.4 points of favorable development. Our homeowners combined ratio of 108% reflected a 12.6-point increase in the loss ratio from large buyers compared to the first quarter of 2021. It is imperative that we continue to obtain rate increases to address the increases in inflation-driven claims severity we're all experiencing, as well as the increases in personal auto claim frequency that is returning to pre-pandemic levels. To sum up our personal lines, we're closely monitoring the market success and results of our new personalized products, as well as working to ensure the overall adequacy of our legacy personal lines book of business. I will now turn the call over to Tony Viozzi, Chief Investment Officer for an investment update.

Thanks, Jeff. We continue to maintain a large percentage of high-quality fixed income securities in our investment portfolio, representing approximately 95% of the $1.3 billion of invested assets as of March 31, 2022. We have strategically increased allocations in corporate and municipal debt over the last two quarters to take advantage of rising market yields and widening credit spreads. More recently, we have also been adding assets to the mortgage-backed portfolio and reducing equity exposure in what we feel will be a more volatile market in the short term. We expect to be strategic in our investment strategies coupled with our laddered holdings to enhance our cash flow for the reinvestment opportunities as the market bond rates stabilize and continue to rise. Net investment income increased 4.6% from the first quarter of 2021 to $7.9 million. Investing new money from premium growth and profitable operating results has allowed us to consistently maintain and increase our investment income. While our average tax-equivalent yield helped study in the first quarter, our average reinvestment rate exceeded the rate we were receiving on maturing assets for the first time in several years. That investment losses of $76,000 were modest compared to the net investment gains of $2.5 million from the prior year quarter. Gains and losses in both periods were primarily related to unrealized gains or losses in the fair value of the relatively modest equity portfolio we held at the end of the respective periods based on carrying values at year-end 2021, we classified 44% of the bond portfolio as available for sale. We adjust the carrying value of the available-for-sale bonds to market value at the end of each quarter and record the unrealized gains or losses as an adjustment to our stockholders’ equity. While the interest rates spike during the first quarter was beneficial to us in terms of reinvestment rates, it also resulted in a $20.6 million after-tax decline in the market value of the bond holdings, which equates to $0.65 per share. That decline more than offset the contributions of our favorable operating results, lowering the book value per share from $16.95 at year-end 2021 to $16.72 at March 31, 2022. I will now turn it back to Kevin for closing remarks.

Thanks, Tony. As a result of the investments we've made in technology, data analytics, and the acquisition of new talent to further support our talented team of professionals, we're very encouraged by the path that we're on. We're beginning to see the positive impact of many of the initiatives that we've implemented, but we know that our work is not complete. Our excitement about Donegal's prospects for the future fuels our drive to seek further advancements and team engagement to successfully enhance our profitability over time. We've never been in a better position to achieve our business goals, and we look forward to reporting on the progress in future quarters. I want to thank our hardworking staff for the dedication they're demonstrating as we continue to make great strides in transforming our business. And thanks to you, our shareholders, for your continued support throughout this time of transition and great progress. At this time, we'll ask Karin to moderate our question-and-answer session.

Thank you, Kevin. I'd like to take a moment to discuss the format for the question-and-answer section. Along with the announcement of Donegal's Q1 2022 earnings and webcast schedule, we've requested and received questions from interested parties in advance. While we have worked, answered some of these questions into our prepared remarks where appropriate, there were a few questions that we will address directly. The first question we received relates to the demand inflationary impact on loss cost trends. How will Donegal's pricing strategy change in response to these trends? Jeff Hay, could you respond to this question?

Thank you for that question. We have changed our pricing strategy as a result of the record levels of inflation that we're experiencing. We nearly doubled the rate achievement in the first quarter in our commercial lines of business and plan to continue with that strategy of balancing our rate achievement with our overall retention goals. Thus far, we've been pretty successful in that endeavor. We're also providing guidance to our commercial underwriters on the accounts that we deemed to be the most underpriced based on predictive analytics that we've conducted, so we can push even harder for increased rates on those risks. Based on our analysis of rate indications, we believe that we can achieve rate increases that will largely offset the inflation rate as those rate increases are earned over time. Separately, on the personal lines side of things, the timing and implementation of our new product suite is allowing us to manage our new business pricing separately from our legacy renewal book. While we're managing market dynamics through price segmentation adjustments within our new product, we can separately take larger rate increases across our renewal legacy book to combat these inflationary pressures while also maintaining high levels of retention for the segment overall. However, it will take us some time to obtain the necessary regulatory approvals and implement our rate plan during 2022, which will delay our achievement in the overall earnings of rate adequacy in our personal lines book of business, similar to other carriers in the marketplace.

Great. Thank you. A follow-up to last cost trends, this question relates to the shift in large fire losses from commercial to personal. Were there any identifiers that suggest the uptick in homeowners' large fire losses may become a longer-term issue within personal lines? Jeff Miller, any insights on the trend in the quarter?

Yes, I'll be glad to address that question. As we monitored the significant increase in large commercial fire losses during 2021, we commented in our calls that we were unable to identify any correlation or commonality in those fires. While we were certainly pleased that the incidents of large commercial fires returned to a more normal range in the first quarter of 2022, as I mentioned in my prepared remarks, there were six homeowners' fire claims in excess of $500,000 in the first quarter of 2022 compared to only one in the prior quarter. There were no factors in these large homeowner losses that suggest there is a particular trend forming. We typically see a higher volume of homeowner fire losses in the first quarter when heating systems are in full use. But we have no reason to believe that trend will continue as the year progresses. The shift between lines is noteworthy, but in total, the number of large buyer claims and the average severity were both generally in line with the first quarter of 2021.

Okay. Jeff, hey, I believe this next question is for you. In the growth plan, what are your specific plans to achieve profitable growth?

Sure, thanks, Karin, I can take that one. I'll separate it out because the strategies really do vary between personal lines and commercial lines. First for commercial lines, we are being very deliberate about our management of retention, new business, and rate in hopefully what is a short-term accelerated inflationary environment. Our lower levels of new business and moderate growth levels are very intentional while we manage rate levels in response to the inflationary dynamic. However, in the longer term, we are building out new corporate underwriting as a function to increase our underwriting specialization in specific industries, account sizes, and lines of business. This will afford us to take advantage of additional market opportunities down the road. The formation of our centralized underwriting operations team that I previously mentioned in my prepared remarks will also drive automation and efficiencies in our processes that will flow through into the market through improved responsiveness to our agents, improved online buying ability for our agents, as well as improved pricing competitiveness in the marketplace. Now, for our personal lines, our future growth is tied and dependent on the success of our new products suite. The enabling technologies supporting both the front-end and back-end, especially the scalability in these lines, are driven by these capabilities. As I mentioned earlier, we're also managing the balance between the success of these new products with retention and adequacy levels of our renewal legacy book of business. That will be critical for our overall profitability for the personal lines division. Kevin talked earlier about our focus on building stronger relationships with national agency groups, and many of the agents in these groups have large personal lines books of business. We do see those growing relationships as a source of profitable personal lines growth moving forward.

The next question is regarding the expense ratio. It picked up a bit quarter-over-quarter. What is the expected run rate for expenses, especially as technology improvements continue? And are you seeing other inflationary impacts such as weak inflation for the longer-term impact on expenses? Jeff Miller, I assume you'd like to take this one?

We've been providing updates on our major technology upgrade over the past several years, and expenses related to the technology systems contribute about a full point to the first quarter of 2022 expense ratio, which is right where we projected it to be compared to half-a-point in the prior year quarter. The other main driver of the increase was increased underwriting-based incentive accruals for agents and employees due to the more favorable loss ratio. As we've talked about in the past, there is a direct inverse relationship between our loss ratio and our expense ratio as a result of those underwriting-based incentive costs that vary depending on our profitability. The current quarter expense ratio was very consistent with past quarters when we had similar loss ratios. In direct response to that question, we're not necessarily seeing a material impact of wage inflation on the expense ratio at this point. However, we continue to add talent and expertise to support our ongoing initiatives and to increase our capabilities. As we look ahead to the next couple of years, we're projecting an expense ratio between 34.5% and 35% as the run rate that we expect over the next couple of years.

Great. Thank you for that insight. The final question relates to the investment portfolio. How will you mitigate the market value impact from the bond portfolio moving forward if rates continue to rise? Tony, I'll refer to you for this one.

Thank you, Karin. At this point, we're not seeing projections for higher rates on the 10-year U.S. Treasury. With that said, we continue to classify longer-term investments as held to maturity to mitigate the potential for market value adjustments should rates rise farther. At the same time, we're building a strong cash flowing portfolio in the shorter end of the curve so that we have the funds available to reinvest as we anticipate a rise in short-term rates.

Thank you. And that wraps up the questions received in advance of the call. If there are any further questions, please feel free to reach out to us. Thank you to all interested parties for submitting questions and listening in today. I will now turn it back to Kevin for any final remarks.

Thanks, Karin. We hope our commentary has been informative today, and that you have a sense of the many strategic and tactical initiatives we're working on to generate and sustain positive financial results. Thank you for joining us today, and have a good day.

This now concludes the first quarter of 2022 earnings webcast. You may now disconnect.