Mark Hughes: Yes, okay. And then, Mike, you mentioned you don’t buy that much XOL, cat XOL. What was the dollar amount of your payment last year for the cat XOL coverage?
Michael Kehoe: We’ll have to get back to you on that, I don’t have that. I think it was $7 million or something like that is a guess. We’ll get back to you on that.
Mark Hughes: My question was, how much did you pay for the reinsurance coverage, maybe not how much did you cede to the reinsurer? I don’t — maybe that you were answering my question, but…
Michael Kehoe: It was somewhere in the mid-single digits is what we paid for our cat XoL treaty for the current year as a deposit premium.
Mark Hughes: Yes, all right. So, if you get inflation on that, it’s not a big deal to your point?
Michael Kehoe: Correct.
Mark Hughes: And then, how much more appetite do you have, is there a kind of upper bound in the near to medium term when you think about where you’re getting this growth and property and excess casualty? How much more are you comfortable taking on within your mix?
Michael Kehoe: Well, I think you’re always looking at the risk you take relative to your capital base and relative to the expected profitability. So, we’ve got a strong appetite to grow our business, especially when we were able to get rates like we get in the current pricing environment. Keep in mind, we’ve been raising rates ahead of trend for probably four years in a row now. So, this is an extraordinary opportunity to create wealth for our stockholders. And so, yes, we’re working very hard to take advantage of it. The one added complication on the property side is, property, depending on the coverage you’re selling can come with an extraordinary amount of volatility. And that’s why I kind of belabor that point about, yes, property is growing for us at a rapid rate, but we’re doing all sorts of things to make sure that’s the volatility is not growing.
We maintain a very broad geographic spread. So, a lot of our property business is really driven by fire apparel as opposed to hurricanes that you would get if you write coastal business in the Southeast United States and the like. So, we see it as a tremendous opportunity. We’re working hard to take advantage of it, but we’re also managing the volatility carefully.
Mark Hughes: And then, Bryan Petrucelli, the profitability when we think about your growth written premium up 45%, consistent with earlier periods. But maybe there’s a little more mix shifts in favor of property or the excess casualty, you take look to that to earn, but you get ceding commissions and so it reduces your expense ratio. Is the earnings contribution from that written premium comparable, little bit less, or little bit more, when you think about the puts and takes around what you retained and how it impacts the P&L? I’m just thinking that — trying to gauge the quality of the 45% growth with this mix versus a different mix from earlier periods.
Michael Kehoe: Mark, I’ll take the first one of that. I would look at it this way. As a public company, our investors are not interested in a lot of volatility in our results. And so, one way we manage that volatility is by buying reinsurance, especially on the property. We’ve got natural catastrophe exposure and especially on the excess casualty, where we’re putting up larger limits. There is a lot of margin in that business. Our reinsurers have made a decent return reinsuring our book of business over the years. But we’re also well compensated with the ceding commission. Effectively we’re offloading the volatility and we’re replacing some of our investment income on those reserves with that ceding commission. So, I think in general, it’s a very positive trade. And I don’t look at that as less profitable than our primary business just — there’s other considerations beyond just profitability. It’s, again, managing that volatility.
Mark Hughes: Perfect. Thank you.
