Elyse Greenspan: Thank you.
Operator: The next question is from Alison Jacobowitz with UBS. Your line is open.
Alison Jacobowitz: Hi, thanks. I’m here for Brian. A couple of questions. I was wondering if you could talk about your marketing spend and how you’re thinking about that over the next couple of quarters and into 2024, how might we see that accelerating? And then to follow up on Elyse’s question, you said the vast majority of your footprint is rate adequate. What areas are not – what hotspots are there and how big are they to you and how are you tackling that?
Alex Timm: Yes, first on rate, I would say, there’s probably a couple of States that we have rate filings in that we’re looking to get approved, and there’s just some small delays. They’re not huge. They’re certainly not where we’re writing the majority of our business. And we expect that those – when those rate changes are approved, that then will be rate adequate. In terms of marketing, I think it’s important to note, we are seeing a very favorable marketing environment. And the way that our direct marketing works and functions is really – it is not that we spend up to a certain budget or review budgets and then say, let’s go spend up to that number. But what we do is we set a profit goal for the machine. And as long as we are attaining those unit profitability levels, we’ll continue to spend.
If we see anything change in the environment, an increased competitive landscape and marketing, degradation in loss ratios, anything change, we are fully prepared to pull back on the growth and then allow really the company to go profitable with the book of business that it currently has. And so, although we saw very strong growth this quarter, we don’t necessarily expect that level of growth to continue. And we’re always monitoring the environment and already to react as needed. Megan, I’ll pass it over to you for some more comments on what we’re anticipating maybe through the end of the year.
Megan Binkley: Yes, thanks, Alex. So, Alex and I – I think it’s also key for us, right, but the key for us continues to be not sacrificing profitability for growth. As Alex said, we do continue to see a favorable environment for us to deploy our capital at high returns. We have identified opportunities in the market to invest up to $50 million in Q4. That $50 million, again, is dependent on continued favorable development in our unit economics and the marketing environment. One point to clarify too, that $50 million, that’s overall acquisition expense. Around half of that is expected to be in performance marketing, and then the remaining $25 million would be across embedded commissions and report costs. From a comparison purposes perspective, we increased our acquisition spend to $27 million in Q3, and that’s, again, in light of the favorable unit economics that we’re experiencing.
As Alex said, we are optimizing for profit. So, the amount of investment that we deploy in Q4 is going to continue to be dictated by the competitive landscape, and most importantly, our internal profitability metrics. As we look to 2024, at this point we are not giving 2024 guidance, but what I can say is, our growth appetite in 2024 is going to be highly dependent on the competitive landscape. As Alex mentioned, as we see opportunities for growth with strong economics, we will continue to invest in a disciplined manner.
Alison Jacobowitz: Thank you.
Operator: [Operator instructions]. And it appears that we have no further questions, and this will conclude today’s conference call. Thank you, everyone, for participating. You may now disconnect.
