Good day and welcome to W. R. Berkley Corporation First Quarter 2024 Earnings Conference Call. Today's conference call is being recorded. The speaker's remarks may contain forward-looking statements. Some of the forward-looking statements can be identified by the use of forward-looking words including without limitation, believes, expects or estimates. We caution you that such forward-looking statements should not be regarded as a representation by us that the future plans, estimates or expectations contemplated by us will in fact be achieved. Please refer to our annual report on Form 10-K for the year ended December 31, 2023 and our other filings made with the SEC for a description of the business environment in which we operate and the important factors that may materially affect our results. W. R. Berkley Corporation is not under any obligation and expressly disclaims any such obligation to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise. I would now like to turn the call over to Mr. Rob Berkley. Please go ahead, sir.

Audra, thank you very much, and let me echo your words earlier with a warm welcome to all that are participating in the call today. We appreciate your time and look forward to discussing with you our Q1 2024 results. In addition to myself, we also have Bill Berkley on the call, Executive Chairman, and Rich Baio, Chief Financial Officer, and we are going to follow our typical agenda where I am going to be handing it over to Rich shortly. He will be running through some highlights; once he has completed his comments, I'll follow up with a few additional thoughts, and then we will be pleased to open it up for questions, comments, and discussion. But before I do hand it over to Rich, I think anyone who's had an opportunity to flip through the earnings release would understand already. But I'll say it regardless that we had a very strong and solid quarter, a great way to start the year. And when you really look at the results and unpack it a little bit, as we'll be doing over the next hour or so, it's pretty clear that the business is firing on many cylinders or essentially all cylinders at this stage. Rich again will get into some details, and while there are a couple of moving pieces in the investment portfolio that merit some conversation or discussion, I think the overall story is that whether it's on the investment side or on the underwriting side, business continues to benefit from the foundation that was poured yesterday. We continue to pour it today and position the business for continued success. This is really a result of the whole team, and in particular, I think it's worth noting the level of expertise, the focus and as important as anything, the discipline that exists on both the underwriting part of the business as well as the investment part of the business. So for us, we're pleased with the quarter. Rich is going to give you some more detail on it. In addition to that, we're probably even more enthusiastic because of how we see the business unfolding not just for the balance of this year, but with every passing day we are laying the groundwork for what 2025 and beyond will look like as well. So with that, let me hand it to Rich and he will share with us some of his thoughts on the quarter. Rich, good morning.

Thanks, Rob. Appreciate it. As you mentioned, we're off to a terrific start in 2024, with record quarterly operating income driven by record net investment income and our best first quarter underwriting income. Operating income increased 53.4% to $423 million or $1.56 per share, with an annualized operating return on beginning of year equity of 22.7%. Net income increased 50.4% to $442 million or $1.64 per share, with an annualized return on beginning of year equity of 23.7%. Our growth in net premiums written accelerated to 10.7% to a record of almost $2.9 billion. Rate improvement and exposure growth continue to contribute to the increase in our top line. Before discussing the segment results, we reclassified a program management business from the insurance segment to the Reinsurance & Monoline Excess segment. This reclassified business has similar characteristics to one of our reinsurance operations already in the Reinsurance & Monoline Excess segment and has common management for both operations. Accordingly, reclassifications have been made to the company's 2023 financial information to conform this presentation. Having said that, the insurance segment increased net premiums written by 11.9% to more than $2.4 billion and the Reinsurance & Monoline Excess segment increased 4.2% to more than $400 million. Pretax underwriting income increased 31.8% to $309 million, and our calendar year combined ratio improved 1.8 points from the prior year to 88.8%. The current accident year combined ratio ex cats was flat year-over-year at 87.7%. A reduction in the current accident year catastrophe losses contributed to a benefit of 80 basis points to the calendar year loss ratio of 60.2%. Cat losses were $31 million or 1.1 loss ratio points in the current quarter versus $48 million or 1.9 loss ratio points in the first quarter of 2023. Combining this improvement along with the prior year favorable development of approximately $1 million brings our first quarter 2024 accident year loss ratio ex cats to 59.1%. The slight uptick in the ratio from the prior year is due to business mix. The expense ratio improved 20 basis points to 28.6% due to a non-recurring benefit associated with compensation. We remain confident that our 2024 full-year expense ratio should be comfortably below 30%, even with the previously announced new startup operating unit expenses. Pretax net investment income grew 43.2% to a record $320 million in the current quarter. Our core portfolio increased more than 63%, which was influenced by Argentine inflation-linked securities. We don't expect the remainder of 2024 to benefit as significantly from much of these securities which have matured in the first quarter. Partially offsetting this benefit is a loss of $29 million from investment funds. As you may recall, we report investment funds on a one quarter lag, and since our first quarter represents the fourth quarter of the year for investment funds, we believe their mark-to-market process is more rigorous due to financial statement audits. The two primary fund strategies for the current quarter's loss were transportation and financial services. To synthesize this down for the second quarter of 2024, we expect investment funds will have less impact from mark-to-market and perform more like they did in the fourth quarter of 2023, as we expect the Argentine inflation linkers to do as well. We had very strong operating cash flow of $746 million in the first quarter, an increase of almost 68% compared with last year. The combination of new money rate above the roll-off yields on our fixed maturity portfolio and increasing investable asset base, the company is well positioned for future investment income growth. In addition, credit quality of the portfolio remains at a AA minus, duration increased from 2.4 years to 2.5 years in the first quarter. The effective tax rate increased to 23% in the first quarter, and we expect this to remain elevated throughout 2024 when compared to the prior year. The amount of foreign income and its contribution to the global earnings of the company at tax rates greater than the 21% statutory rate in the U.S. will likely result in a higher annual expected effective tax rate. Our stockholders' equity remains very strong at a record $7.8 billion, despite an increase in unrealized losses and currency translation losses of $98 million in the quarter. Book value per share was $30.34 at quarter end, an increase of 4.4% from year-end and 14.7% over the prior year quarter. With that, Rob, I'll turn it back to you.

Okay. Rich, thank you. So, let me start with a few comments on the marketplace and then I'll offer a few further observations on our quarter. So perhaps a place to begin would be bifurcating between insurance versus reinsurance, which obviously the markets are related, but they're not one in the same and starting with insurance maybe calling out E&S as a part of the market. I think there's been some commentary around perhaps E&S is losing some momentum and I would suggest that one needs to use, at least through my lens, somewhat of a finer brush. As far as we can see, the momentum for the liability lines continues to be as strong as ever. To the extent you're seeing any slowing in the momentum of E&S, it's likely to be property related. As far as the property market in general, when it comes to insurance, we think that it still does have some momentum, but it probably does not have the level of momentum that it had last year. We're still seeing rates moving up and we expect they will continue to move up for the immediate future. That having been said, I think part of what you're seeing is the insurance marketplace catching up to what the reinsurance marketplace had taken action around, and their costs of capacity have gone up. As far as GL, again, from our perspective, it remains very robust, both admitted and non-admitted, and no surprise, it's the social inflation continuing to persist that is driving that. Just on the topic of social inflation auto, which as I think I've commented on in the past, continues to be very much in the crosshairs of social inflation. We think that part of the market that you're going to see considerable additional firming going on, specifically in commercial auto. Excess and umbrella, particularly to the extent that it relates to the commercial auto market, you are going to see additional firming there as well. Workers compensation, we have offered our more defensive view around that. And of course, as far as professional liability goes, we have called out D&O where obviously some number of years it spiked. More recently it has been dropping at somewhat of a precipitous rate. At this stage, we view that it is not bottomed, but it is closing in on the bottom. Pivoting to reinsurance, barring what Mother Nature may do tomorrow, it would seem as though the property cat cycle has run a bit of its course. From our perspective, rates were off for property cat reinsurance at 1.1, 5% or more risk adjusted. And, we will have to see how that unfolds. That having been said, we are seeing some potential green shoots of discipline returning to the liability market under the umbrella of reinsurance. We have been reasonably outspoken about our concerns around discipline over the past couple of years within the liability or the reinsurance liability market and we will see what comes of that. Turning to our quarter top line, just shy of 11%. As you would have noted in the release, we are pleased with the rate increase that we got at 7.8%, which in our opinion is comfortably outpacing trend in the aggregate. The renewal retention ratio continues to be at approximately 80%, which is what we would expect. The strength in insurance growth, as Rich referenced, just shy of 13%, is quite strong. Property in particular was a contributor as we take advantage of that market opportunity. And again, in keeping with my comments about market conditions on the reinsurance front, you would have seen us continuing to exercise discipline when it comes to the casualty or liability lines. As far as our loss ratio goes, clearly a good performance in the quarter, and we believe that the stage is set for a good balance of the year, as well as increasingly what we should be expecting for 2025 and beyond. Just as a data point that I share from time to time because I think it's a helpful indicator or certainly a truth that we can all hang our hat on. During the quarter, our paid loss ratio was 45.8, which is the second lowest it's been in the past eight years and the only time it was lower was by 50 basis points. So we are in a very comfortable place on that front. Just on the topic of losses, maybe spending a few moments on the topic of loss reserves, and I think there's a shared appreciation for the challenges that stem from just to put a stake in the ground 19 and prior and what that may mean. From our perspective, I think that we are well on our way, as I suggested to some, to having that behind us. The averaged life of our reserves is just inside of four years, so at this stage that period is getting very much towards the tail end, is there perhaps a little bit out there still? We'll see what time it's possible; but certainly, our expectation is that much of it has been processed, if you will. I think a few other data points that are worth noting at least we find them to be helpful as leading indicators when it comes to the strength of reserves, and putting aside the comment about paid losses, we would encourage people to consider having a look at IBNR as a percent of total reserves, the ratio of IBNR to case reserves and while some people may look at those two data points and say, well, you know, they could be impacted by the growth in the business and certainly there would be that reality to a certain extent, though I would suggest that people should look more carefully at how much of our growth was coming from rate. That all having been said, there is another data point that we look to and we would encourage others to consider as well and that is initial IBNR as a percent of net premium earned. I think all of these data points that I have drawn to your attention are worth your consideration and I think would suggest this our reserves are improving and more likely than not continuing to improve, and we will see that mature over time. As far as expenses go, Rich walked through that. In particular, I would just call out that we had four businesses that had been in their infancy and the first quarter of this year is the first time we pulled them into the expense ratio, and we're pleased to see how they are developing and maturing. On the investment portfolio, Rich had walked you through this as well, but a couple of highlights from my perspective, he referenced the AA minus, and it happens to be a very strong AA minus, so there could be a lot of credit activity and we would still be in a very comfortable place. As Rich flagged, the duration nudged out from 2.4 to 2.5. Do we continue to look for opportunities to nudge it out? Yes, absolutely. Do we feel any pressure that we need to do that overnight? Absolutely not. The book yield, as Rich referenced, or maybe he didn't, I'll be referencing now, was 5.9%, but if you back out the Argentine component, the book yield is actually 4.2%. I think that's relevant because when we talk about how we're sort of laying the ground for the future here or what one should expect going forward with our sort of core domestic portfolio, which is the lion's share of what we have at 4.2% and a new money rate that's somewhere between 5.25 and 5.50, I think that combined with the strength of our cash flow should give you a sense as to the earnings power of the business and the contribution that we will be receiving from the investment portfolio, which again, I think there's considerable upside from here, again with the domestic core fixed-income portfolio, that's 100 basis points plus upside from here. So when you put it all together, I think that we have been thoughtful and prudent on the underwriting side. We responded to the data and pushed rates and adjusted terms, conditions and appetite mix of business, and we are seeing the benefits of that, but we don't want to quite frankly as we had shared with you in the past, declare victory prematurely; but more likely, in my opinion than not, we'll see good news to come on that front. In addition to that, as I just suggested, as it relates to the other part of our economic model, our investment portfolio, very well positioned, benefiting from the focus and the discipline and the opportunity to take advantage of a new money rate that is 100 basis points above where our book yield of our core portfolio will prove to be very advantageous. So with that, I will pause there, and Audra, if we could please open it up for questions?

Thank you. We'll take our first question from Mike Zaremski at BMO.

Good morning, Mike.

Hi, good morning. Thanks for the data point on the paid to incurred and the color on the reserves. Just curious, we did see in the staff statements too, that the reserves ratios appear to be getting better. Just curious, do you guys make any material changes or maybe top off a little bit the 2023 vintage as well?

When you say top off, what is your...

Just curious if you made any changes to kind of your view on the more on the 2023 vintage as well, which we couldn't see in any changes there on the staff data; we won't see that until next year.

There is nothing particularly significant at this time. We are continually reviewing our loss picks and making adjustments as needed. We do not simply finalize these picks and leave them unchanged indefinitely. That said, there have been no material or important changes to the portfolio overall during 2023.

Okay, I understand. In your initial remarks, Rob, it seemed like you were more optimistic about how the portfolio is developing compared to last quarter. Regarding pricing power, I realize that one quarter doesn’t establish a trend, but it appears to be relatively flat. Are we still maintaining the outlook that top-line growth will likely be in the low double digits for the year? Or do you think improvements could be seen, especially if pricing on the cash flow side for the industry begins to increase?

My best guesstimate at this stage and that's with a capital G is that we should be able to grow the business all, given what I see between 10% and 15%. As Mike, I know you're aware of and we all presumably have a shared appreciation. We have 60 different businesses, all focused on different niches within the marketplace. And at any moment in time, there are parts of the market that we participate in that are improving and there are parts of the market that are facing more of a headwind. One of the things, again, as I think we've discussed in the past is that once upon a time, these product lines marched in lockstep, at this stage, they have seemed to be decoupling more and more every day. So there'll be some puts and there'll be some takes, but overall, I think that there's a better than average chance that we can grow between 10% and 15% for the foreseeable future. Could there be a quarter that we come in shy of that? Yes. Could there be a quarter that we exceed that? Yes, but that's sort of the channel markers I would offer you.

Okay. And just lastly, on property, I feel like there was a couple of comments made. You said that maybe that's an area that could lose a bit of pricing momentum in the E&S marketplace, given it's a more, you know, my words, a little bit more commoditized line in terms of the ability for people to come in and out. But then you also said, you know, you think you've been growing into property a bit over time. So just want to be clear, do you still feel like property is an area that over the course of the year, you know, returns are good that Berkley, which is underweight can play more offense?

Look, so let maybe just to bifurcate it a little bit between insurance and reinsurance. So, first off, I think that one needs to understand just because pricing has peaked, that doesn't mean there's not still good margin to have. So if you look at our reinsurance business and the opportunity that we still see in property, we view it as still a healthy line. That having been said, barring the unforeseen event, we think that property cat specifically has perhaps seen the peak we'll see with time. Obviously, the reinsurance marketplace has an impact on the insurance market; when reinsurance costs are up, then obviously there is a trickle-through or a waterfall effect for the insurance market and there is a little bit of a delay in that. So the reinsurance market, which forced the firming, I think, is out ahead. I think there's still margin to be had there, I think the impact that it's had on the insurance market is still very real, as the insurance market is still coming to grips with that higher cost of capacity that they rent from the reinsurance marketplace. But I don't think that there is the same level of pressure in or urgency in the insurance marketplace in particular E&S that we saw or felt a year ago. That doesn't mean there's not still opportunity. That doesn't mean we don't still like the margin and don't still want to have a second helping of whatever the market can offer. We have a view as to what adequate rate is in order to achieve the risk-adjusted return that we think is appropriate. Right now, we think that opportunity, generally speaking, still exists in property. How quickly that will dissipate? I don't know, but we play close attention to it, and we will not have an issue shutting off the spigot if we don't think it is a good use of capital going forward.

Helpful. Thank you.

Thank you.

We'll take our next question from Josh Shanker at Bank of America.

Good morning, everybody.

Yes. Good morning, everybody. Thank you. I was interested in just getting a little bit of past perspective and maybe future perspective on the impact of the Argentine component of the investment portfolio in the traditional NII. How has it impacted the past, this quarter and how should we think about it in the future as a one-off line item?

It's a relatively recent development that reflects changes in the political landscape. Richie, you mentioned during your comments the events from the fourth quarter of last year, which marked one of the first significant effects we observed, and we noticed an even larger impact in the fourth quarter. It will be interesting to see how this progresses moving forward. Rich, could you take a moment to explain to Josh and anyone else interested what has happened with these linked securities in Argentina?

Sure. Happy to do that, Rob. So Rob had alluded to earlier, the impact, excluding Latin America, in terms of our book yield being 4.2%. If we were to look to the prior period, a year earlier, if you will, just to show an appreciation for the increase in the domestic portfolio, that would have been around 3.6%. So certainly saw some pick-up there in regards to our overall yield. We did have a majority of our Argentine positions mature in the first quarter. And so for that reason, that's why we're saying that we would not anticipate the same level of investment income that we saw in the first quarter of this year, but would anticipate that we would get back down to a more leveled basis, as it relates to the Latin American portfolio in the second quarter and it will continue to decrease as the remainder of those inflation linkers mature throughout the remainder of this year.

So given that sort of situation, if we think about the amount of portfolio that matured this year or was preempted by a sale of investments, it was no different than in prior quarters. We can look at the sort of the trajectory on where investment income has gone, excluding 1Q and think about that might be a way to think about, as we head to a 5.5% yield on the overall portfolio, that it will continue along a trajectory towards that path?

I think that's a fairly reasonable approach, Josh, yes.

Okay. And just on the reserve releases, you know, historically, you tend to be pretty conservative in your portfolio, not releasing a lot of reserves, sometimes there's one-off course where it happened. What happened in this quarter that made you feel that there was a reason to throw off some reserves here?

Josh, as we've mentioned before, we evaluate our reserves in various ways by each operation within the group and by product line in detail. We also assess it at the overall group level, considering where we stand and what adjustments may be necessary. While some may not adjust their reserves as frequently as we do, we continually monitor the situation to ensure we're not overextending or underutilizing our resources. At any given time, there are many factors at play, but we believe everything is currently in a solid position.

All right, I'll come up with some harder questions, come offline, but I appreciate the disclosure. Thank you.

Okay. Thanks for the question, Josh.

We'll move next to David Motemaden at Evercore.

Hi. Thanks. Good morning.

Good morning, David.

Good morning. Just had a question, if you could just let us know, understand it's about $1 million of favorable PYD. How much of that was coming from the insurance segment versus the reinsurance segment? And maybe just a little color in terms of the movement between lines and accident years?

Sure, David, to make a long story short, the amount of movement from each one of the two segments was what I would define relative to the overall reserve position of each segment, let alone the aggregate, one could say is immaterial. And as far as the development goes, if you wouldn't mind just catching up with Karen on those details. But there wasn't anything out of the ordinary; and based on what I have in front of me, but why don't you catch up with Karen and she can try and give you a little bit more detail on that. But if your question is, are we taking lots of reserves out of the current year or the more recent year? No, the answer is, we're not.

Understood, that...

And a reminder, the life of our reserves is just inside of four years, and the incurred tail is inside of three years.

Got it. That's helpful. And then just following up on that, just looking at the accident year loss ratio ex cat in the insurance business, assuming negligible PYD to sort of back into that, it looks like it deteriorated around 100 basis points year-on-year. I'm wondering, was there any change that you guys made to loss trend or anything on the mix side that you would just call out as sort of pushing that up?

Rich, is there anything that you recall?

I think certainly with social inflation, some of our loss picks maybe are slightly higher than where they had been the year earlier, but it really is just a mix of the business that's just rising that.

Yes, and probably the areas, well, not probably the areas that we are looking hardest at the picks would be around commercial auto, and it's less that we have concerns about prior year, it's more that we just have concerns about the environment and where it seems to be today and where we expect it's going tomorrow; we've got to keep up with that.

Understood. Thank you.

Commercial auto and also some of the excess and umbrella.

Yes, that makes sense. Understood. Appreciate it.

Thank you.

We'll move next to Elyse Greenspan at Wells Fargo.

Good morning. Sorry. Thank you. My first question is just in terms of the flow of business you guys are seeing with the E&S market. We saw some stamping capacity out of three of the largest E&S states turn negative in March, which I recognize is only one month of data. But just curious what you're seeing with the flow to the E&S market and any color you have just on what we saw in those three states in March?

So I'm not familiar with the data, Elyse, that perhaps you have in front of you. But speaking to our experience, we continue to see during the first quarter very robust activity on the E&S front, particularly on the casualty or liability. In general property, there continues to be an opportunity. But again, I think it's probably not what it was a year ago. And I think that that's just the reality of things and the cycle. So we are more of a liability shop than a property shop though we do participate in property. I expect that we'll try and make some more hay in property before we call it a day, but it is possible that, that may have not peaked, but property is peaking. On the liability front, there is nothing that leads me to believe that the momentum is going to be subsiding anytime soon. I think the reality is that social inflation, the legal environment, the social environment persists and that continues to drive lost costs. And I think that there's some reasonable chance that the reinsurance marketplace is becoming more acutely aware of this social inflation issue and you're going to see them look for opportunities to try and put pressure on the insurance marketplace when it comes to casualty and liability lines like they did on the property front. As it relates to us, we are less exposed or susceptible to that because we are a small limits player, approximately 90% of our policies that are legally allowed to have a limit have a limit of $2 million or less. So we are not as exposed to the whims of the reinsurance market, but we look forward to the reinsurance market embracing greater discipline on the casualty lines.

And then going back to one of the prior questions on the loss ratio, I guess, you know, within insurance, I know you guys mentioned mix driving that up and it sounds like there's, you know, nothing else going on there except, you know, some prudence you pointed to within the picks around commercial auto. So given that you guys have these designed loss ratios, would you expect like the underlying loss ratio over the balance of the year in insurance to be pretty consistent with what we saw in the first quarter?

I think that we will continue to look at the business and the data and how we think things are performing, and Elyse, hopefully you would expect we will respond accordingly. So that's the best I can do, sorry, if it's not good enough.

No, that is good enough. And one last one on workers' comp. Anything that you're seeing there, I know at times you kind of called for a floor and a turn and obviously that's been good opportunities for folks for a while and I know that business for you guys, we did see a little bit of a decline in the Q1, but how are you thinking about the comp market not only in 2024 but also going into 2025 as well?

My colleagues and I continue to believe that frequency is an asset for the industry, and we, along with others, have benefited from it. However, we are aware of and somewhat concerned about rising medical costs and their potential trajectory, which appears to be delayed. Are we at the bottom? It seems that my prediction of hitting the bottom might have been considered premature or even incorrect by some. That said, we are noticing more signs of California reaching a bottom, while much of the rest of the country is likely a step or two behind.

Thank you.

Thanks for the questions. Have a good day.

We'll move next to Ryan Tunis at Autonomous Research.

Good morning, Ryan.

Hi, good morning, Rob. Yes. So just, I guess on this E&S point, if we do get into an environment where business starts to flow from E&S back to admitted. Can you just talk about, I guess, the capability of your business to be able to write it on admitted paper as well? And I would guess you'd have better capability to do that on the casualty side than the property side. But I'm not sure about that, but I'm just curious like I know in the past you've kind of been a 'standard not admitted player' you've kind of lived between. So, yes, just curious on your thoughts?

Ryan, thanks for the question and long story short, obviously we have both the tools and the expertise to write both non-admitted and admitted. I mean, ultimately what it really boils down to is when some of those exposures make their way back into the standard market, is that something that we think is a sensible use of our capital, when the standard market, if it were to become more competitive at that time, do we still think that it's a good use of capital? So do we have the ability to do it? Yes, but we'll need to look at the pricing, the terms and conditions and my colleagues will have to reach a conclusion as to whether they think it's sensible or not. So the tools and the capabilities, yes, and colleagues will have to decide whether it makes sense or not.

Got it. Switching gears, regarding the expense ratio, I noticed this morning that in this cycle there has been more improvement in the underlying combined ratio on the expense side than on the loss side, which is positive if it remains consistent. You have mentioned a sub-30 combined ratio in the past, but that wasn't the case previously. I just want to clarify whether this is a short-term forecast or if you believe this level of expense ratio, give or take a point, is sustainable long term.

Our expectation is that it's going to start with a two indefinitely. Is it possible there could be some extraordinary something or other that could change that? Yes, of course. But at this stage, you know, we feel that we are in a good place and that this is very sustainable.

Thank you.

Thank you.

We'll go next to Mark Hughes at Truist.

Yes. Thank you. Good morning.

Good morning.

I think you've expressed more enthusiasm about the other liability than commercial auto, but commercial auto accelerated a bit and outgrew other liability, which decelerated a little bit in terms of net premiums written. Anything to read into that?

I think the takeaway should be how hard we are pushing on the commercial auto rate and the markets accepting it to a great extent.

What do you see in terms of pricing in the liability line? You’ve obviously given us the kind of your consolidated non-workers comp number, but anything specifically about the other liability?

Rich, my recollection is that we don't break out how our rate increases by product line, is that correct?

That's correct, Rob.

Yes. So, Mark, what I would offer you for your consideration is that we feel comfortable that we are outpacing comfortably our view on trend or certainly without a doubt keeping up with it and likely outpacing it.

Very good. And then the final question, the cash from operations is quite strong. If you touched on that earlier, I apologize, but what was the big driver of the year-over-year increase?

Go ahead, Rich.

It's really driven by the underwriting performance. So we had very strong cash collections on a net premiums basis. And then our paid losses, as Rob alluded to earlier from the paid loss ratio perspective was very low as well. The combination of those two items was really the biggest driver.

Thank you very much.

We'll go next to Brian Meredith at UBS.

Good morning, Brian.

Yes, thanks. Hi, good morning. Two questions. Rich, I'm just curious, could you just give us the actual income that you generated from the Argentina inflation bonds in the quarter? Just so I don't have to do the math.

Rob, I'm not sure we've then generally given that level of detail. I'm not sure if...

I can back into it with what you said in the yield, but I just wanted to know what the actual number was.

Why don't we take it offline?

Yes, Brian, he's just going to check with an attorney and call you back. How about that?

Okay, fair.

Rob, I'm just curious, perhaps you can remind us how much of your, call it short-tail business is cat exposed? And how should we think about your kind of cat load here in 2024 based upon just the growth you're seeing in that short-tail business? I'm trying to understand, Brian, you want to know how much of our business is exposed to catastrophes?

Yes, the short-tail business, but you're seeing really good growth in that business and obviously you said rates good, right? I'm just curious how much of that is actually catastrophe exposed, kind of property versus not cat exposed, where you're seeing the growth. And then if I look at your, call it cat load that you've been had over the last year or two, it's kind of run around 2% to 3%, is that pretty consistent what you think would look like going forward, given your portfolio?

The answer is the 2% to 3% is probably in the right zip code; it may be up a little bit from there. As far as how much of our portfolio is cat exposed? You know, that's become perhaps a more complicated question than it once was because of what we've seen happen with wildfire and SCS over the past several years. So I don't have a percentage for you as to what's exposed to quake or particularly as we get earthquake apparently now in the northeast or exactly what is exposed to wind. We're happy to pick up the conversation offline, but we have a view that cat load has had to evolve from how people thought about it just a few years ago. So the short answer is, I don't have a percentage for you, but we're happy to further the conversation if you like.

Great. Thanks, Rob.

We'll go next to Meyer Shields at KBW.

Hi, I just had one. Hi, this is Dean on for Meyer. I just had one question. I was sort of surprised to see that there were no share repurchases in the quarter. Is there anything anymore color you could provide on that? Or how should we think about repurchases for the remainder of the year?

We have, I think, as we've discussed in the past, we have a view as to what the real book value of the business is, putting aside the various accounting principles. We have a view as to what we think the earnings power of the business is. And obviously we know what the stock is trading at. And when we see an opportunity to step in and buy the stock and in what we view as an attractive manner for the shareholders, we will do so. But at this stage, we have not felt as though it's the best mechanism to return capital to shareholders.

And that concludes our Q&A session. I will now turn the conference back over to Rob Berkley for closing remarks.

Okay. Audra, thank you very much, and thank you to all for finding time to dial in. We appreciate your interest in the company. Again, I think by any measure, a very strong quarter. But perhaps, at least from my perspective, more interesting, more exciting is how the stage is set for what will not just be the balance of this year, but likely more and more what 2025 will shape up to be. Thank you. Take care. Bye, bye.

This concludes today's conference call. Thank you for your participation. You may now disconnect.