Juan Andrade: Look, I think — thanks, Greg. It’s Juan. I think ultimately, all of this goes back to the fundamental question as to how much capacity is available for property in general. So I think it is part of the same equation. And so in our view, we expect this market to continue the way it is. You look at the rates that you’re getting in wholesale in North America are basically 30% or plus. In the retail property in North America, they’re 20% to 30%, and that has continued. That sort of gone unabated in this period of time. So I think that same dynamic that we talked about earlier, where not only is there a supply and demand issue here, but there’s also the psychology that Jim was talking about. I think Yaron may have asked the question. The environment hasn’t fundamentally changed. And so because of that, I don’t think there’s going to be a fundamental change in pricing in property ex cat at this point in time.
Gregory Peters: Fair enough. Thank you for the answers.
Juan Andrade: Thanks, Greg.
Operator: The next question comes from the line of Meyer Shields with Keefe, Bruyette, & Woods. Please go ahead.
Meyer Shields: Great. Thanks so much for fitting me in. Two really quick questions. First, Mark, in addition to the investment spend, I think you noted some one-time expenses in insurance. I was wondering whether there’s any way of quantifying that?
Mark Kociancic: Well, one-time expenses. So let me break it down into kind of two components on the insurance expansion. So I would say roughly maybe a little less than two-thirds of our expense is compensation related to human capital. So we are expanding that’s going to provide future bandwidth to underwrite and current bandwidth. It’s clearly actionable. The second piece is you are dealing with technology spends as well to improve systems and middle office process type stuff. So that stuff is making its way through. It’s very manageable. It’s a relatively modest amount, and it’s something that comes first and the growth is trailing somewhat. But we definitely see this paying for itself and again, manageable within the combined ratio assumptions that we have for the plan.
Meyer Shields: Okay. Perfect. That’s very helpful. Second question, just to make sure I’m not overlooking anything. I think, Juan, you’ve talked about a lot of executives have noted that this year — or sorry, the 1/1 ’24 reinsurance renewals should be much more orderly. Is there any benefit to the more chaotic renewals that we saw last year? Did that — or are there any good guys embedded in that?
Juan Andrade: Well, look, I mean, you always want to be in a place where your customers, your cedents and the brokers sort of understand the situation and understand what you are, essentially putting forth the storms, conditions, et cetera, et cetera. And I think that was a more challenging renewal last year because the market changed so quickly. I think what we see now is basically what I articulated earlier, where, at this point in time, I think we all recognize the world that we are living in, we all recognize the environment. Discussions have begun much earlier than they did last year. And so from that perspective, I think that’s actually a pretty good thing. So we feel pretty good about it. I think, frankly, the only benefit that I would have seen last year is the fact that Everest was one of the first, if not the first, to get out and offer constructive terms and conditions and pricing, whereas a lot of our competitors were still looking to essentially fill the retro buckets to know how much capacity they had.
So I think for us, that was a good guy last year. But ultimately, I think having an orderly market is good for the industry.
Meyer Shields: Perfect. Thank you so much.
Juan Andrade: Thanks, Meyer.
Operator: The next question comes from the line of Brian Meredith with UBS. Please go ahead.
Brian Meredith: Yes, thanks. Just one quick one here. Mt. Logan, I’m just curious kind of plans are for 1/1. Do you think you’re going to be able to increase capital there and maybe investor demand for those types of facilities?
James Williamson: Yes, Brian, this is Jim Williamson. Yes, Mt. Logan has had a pretty solid year from a capital raising standpoint, particularly against the backdrop of a lot of the big ILS allocators sort of being on the sidelines this year. We’ve raised over $250 million, AUM sits just under $1.1 billion. So feeling very good about that. The team at Mt. Logan has done a terrific job of building a pipeline of what we view as sort of world-leading allocators, being the really smart, long-term money, the sovereign wealth funds, the pensions, et cetera. And we do expect some incremental capital raising at 1/1 and throughout the course of next year. I will say, as a general comment, I’ve had a number of discussions recently with some large pension fund allocators, the challenge they still have is they’ve seen a lot of deterioration in other parts of their portfolio, which tends to bump them up against their ILS risk limits.
And that is easing a little bit, but it’s still a factor. And so I think — which, by the way, we view as a good guy, it helps sustain momentum in our underlying market, which is our critical priority. But my guess is that we’ll have some nice successes in 2024.
Brian Meredith: Great. Thank you. I appreciate it.
James Williamson: Got it.
Operator: The last question for today is a follow-up from Mike Ward with Citi. Please go ahead.
Michael Ward: Hey, guys. Thanks. I was just wanted to follow-up on the Otis and Acapulco. Is there any quantification on the potential industry exposure — I know it’s early.
Juan Andrade: No, Mike, this is Juan. I think it’s so early. I mean, this thing just made landfall really yesterday at this point in time. And for us, as I said, this is a modest exposure based on how we have managed the portfolio to reduce the volatility. But I think it’s way too early. We haven’t seen anything yet from any of the modeling agencies at this point in time.
Michael Ward: Okay. Thanks so much guys.
Juan Andrade: Thanks, Mike.
Operator: That was the last question.
Juan Andrade: Okay. Well, thank you all for your questions and for the excellent discussion. We had an excellent quarter, and I look forward to discussing the company’s strategic plan at our Investor Day on November 14. I hope to see you all then. Thank you.
Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.
