Brian Haney: One thing to note is the growth rate actually has been relatively steady. So I think if you go back and read the commentary, it’s been in that 20 – low 20s range and slightly accelerated range. I think it just so happened, there was a little more acceleration this quarter. That could just be volatility. I would agree that we are seeing, I think, continued casualty submission inflow, which is probably stemming from some of the reserve issues that some of the other competitors are having. And you’re right, Mike has mentioned that the property market is more orderly, but we’re still seeing a strong submission. It’s just there’s more capacity, and it’s just – it’s a little less distressed than it was last year.
Michael Zaremski: On the comments about your technology and how your technology is evolving, it could become more powerful, how would that translate into KPIs we see as investors? Would you potentially get more submissions or just be able to act more quick around the submissions or do you feel like it would just allow you to price risk better or all the above or any color be great?
Michael Kehoe: This is Mike. One of the interesting things about technology is it impacts multiple areas of the business in a material way. So can it speed up customer service? Absolutely. Can it allow us to incorporate more third party data in how we evaluate an individual risk and segment and price risk and drive a more accurate underwriting model? Absolutely. Can it help us increase the productivity of our workers, effectively lowering our expenses? Absolutely. For all these reasons, and probably others, it’s the reason we’ve prioritized that the way we have over the years and continue to make an enormous commitment. I think about 20%, maybe slightly over 20% of our headcount is in our IT department. And I think that just anecdotally speaks to how important we think it is to our business model.
And having made technology a core competency of our business 15 years ago, when we started the company, alongside of underwriting and claim handling, I think it just puts us in a very interesting position today compared to a lot of companies in the industry that maybe aren’t quite as far along.
Michael Zaremski: I feel like you’ve been talking about it a lot, but I guess you haven’t been willing to say it could kind of decouple your long term thoughts on growth because the company still expects growth over the long term to decline along with the marketplace. Lastly, just quickly on your commentary, so I believe you made the comments in your prepared remarks, Mike, that you added some reserves, some conservatism, which seems prudent in light of higher inflation levels. I don’t know – am I understanding that correctly? When we see the statutory data, we’re going to see some topping off of certain accident years or anything you’re trying to tell us there?
Michael Kehoe: Well, it was really speaking more toward a general management approach to the business, which is recognizing that ours is an uncertain business, to some extent. There’s all sorts of quantitative methods that we use to drive more certainty, but there is an element of uncertainty. And we collect premiums upfront, we pay the claims over a number of years. And so, I think it’s just prudent to be as cautious as possible, within reason, in terms of setting aside dollars today to pay claims in the future. When inflation picked up, that wasn’t really anticipated. I don’t know by anybody, but certainly not by us. And so, I do think that had a negative impact in the level of conservatism from a couple of those years.
But I wasn’t really speaking to anything specifically. But we’re going to file our case soon and our step statement soon thereafter. And there’s a lot of very granular information that people can look at in terms of reserves by accident year and by statutory line of business.
Michael Zaremski: Just to be clear, I think in the past, you said that every year has developed probably, or most of your years. So are you saying we might see something a little bit different, like we’ll see probably for many peers when you file the K?
Michael Kehoe: Our 2011 year developed adversely. It was the first full year we were in business, and the company was tiny. I think our losses at the end of 2011 were $12.4 million and it’s developed up to $15 million. So, we had one bad year, but in general, it’s immaterial. The last several years, I think it was Brian Haney who made the comments about the fact that we’ve been getting rate increases ahead of loss cost trend. So, again, these are the most conservatively reserve years in our company’s history, and it coincides with the market becoming a little bit tighter, if you will. Insurance companies having more pricing power, so in that favorable pricing environment, yeah, we leaned into it and grew our business in a pretty dramatic fashion. But the reserves reflect – the net of all this is that our reserves are in a great spot.
Operator: And we’ll take our next question from Mark Hughes with Truist.
Mark Hughes: The expense ratio, quite good in the quarter, below 20%. With the mix of the business you have now, I know you mentioned, I guess, the ceding commission is 120 basis points, seeing better acquisition costs. I assume that the ceding commission is 20%. Good bogey, given the current mix, et cetera, for 2024.
Bryan Petrucelli: Mark, I think that’s consistent what I said. I think looking at looking at the expense ratio over the 12 month period probably gives you a very good indication of where we expect to be going forward.
Mark Hughes: Anything in the fourth quarter that was unusual? I hear what you’re saying, but trying to recall whether the fourth quarter has some seasonality that makes it lower than the full year?
Bryan Petrucelli: No, I would say quarter to quarter, there’s always going to be a little bit of variability, but there wasn’t anything in particular to note in our Q4.
