Meyer Shields: Okay. That’s helpful. Go ahead, please.
Steve Yi: I’ll just add one thing, which is that we do, and I think we mentioned this before, I mean with just how extraordinary this hard market cycle’s been, I think you’re going to need to see an improvement in the overall combined ratio as these rate increases are and through, before carrier like Allstate really lean into those profitable pockets just because whether you’re in a hard market or a soft market, new policies do tend to perform slightly worse than existing policies and to incur that new policy or growth tax, I think that there isn’t a ton of appetite to do that while their overall results are where they’re.
Meyer Shields: Yes, no, that makes perfect sense. Looking forward, should we assume that free cash flow on a quarterly or annual basis is a good proxy for debt reduction?
Pat Thompson: Yes, and Meyer, this is Pat. I would say, in the near to medium term, it will be, and I think we are in a spot where we are focused on putting the free cash flow towards net debt reduction. And that could either be building our cash balance, paying the revolver, or starting to chip away at the term loan beyond the mandatory amortization. And so, I think we’re in a spot where that’ll be the focus and to the extent that changes will be, I’ll be communicating it at quarterly results at some point in the future.
Meyer Shields: Okay. Perfect. Thanks so much.
Pat Thompson: Thanks Meyer.
Operator: Our next question comes from the line of Ben Hendrix with RBC Capital Markets. Your line is open.
Ben Hendrix: Thank you very much. Hey, guys. We heard from Humana this morning reiterate expectations for an active shopping environment for AEP. And as we get into closer to AEP prep, is there any call out you can make or any change in behavior among your partners in preparation for AEP this year that, just in terms of just general changes in behavior or spending for MA?
Steve Yi: Yes, I mean, I think we’ll have a better idea of this in Q3 because that’s when the actual budget discussions happen, both with carriers and with the brokers. So I think overall, I think the sentiment has been generally positive. Certainly there’s been some headwinds with higher than expected utilization rates, right. But there’s also been some tailwinds or positive news, namely the applicability and the potential for impact of the new CMS marketing regulations. So I would say overall, what we’re hearing from our partners is generally positive. I think overall, the trend towards there being a heavier mix of carrier demand partners and dollars from carriers versus brokers we continue – we expect to see that trend continue.
But in terms of just more specificity into how that sentiment, like the sentiment you mentioned today from the Humana quarterly earnings call, we’ll translate into budgets for the upcoming AEP and OEP. I think we’ll have more clarity into that in Q3.
Ben Hendrix: Got you. Thank you. And then finally just with, it seems like you’ve got some pretty significant platform changes with some cost savings and guidance. And then also we’ve got the with the White Mountains stake could this foreshadow any broader platform or strategic shifts that we could think about longer term in the future? Thanks.
Pat Thompson: Yes, and Ben, this is Pat and would say, that the short answer to that question is no. Where I think we’ve – we’ve been a growth company in the past. We’ve been – we’ve suffered at the hands of this hard market along with pretty much everybody in the P&C space. We are extremely bullish about the long-term prospects for the industry and particularly, for our business. And I think we obviously tightened our belts to try to buoy results in this tough environment, but we believe the innovation engine and the delivery engine are untouched. And we continue operating the business efficiently and effectively. We’re really excited to see, what we think we can deliver is the market improves, quite frankly think it’s going to be an awful lot of fun to be a part of.
