Mike Zaremski: On the cost efficiency initiative, I was hoping you can just give some more color whether the program is weighted towards distinct buckets. Some of your peers have talked about collapsing back offices and outsourcing and less real estate. Is there anything you’d like to call out? And just on the cost program as well, just some clarification. Just the margin guidance, is that inclusive or exclusive of the charges over the coming two years?
Pat Ryan: Well, thanks, Mike. I’ll just start out and turn it over to Jeremiah. These are proactive strategic initiatives. We’re always challenging ourselves to improve our ability to serve our clients. So we believe we’re taking a great platform to the next level of operating excellence so we can better serve those clients and frankly prepare for the next wave of what we believe is exceptional growth ahead of us. Jeremiah, do you want to pick up?
Jeremiah Bickham: Yes. Thank you, Pat. So Mike, I know it’s hot off the press. But in the 8-K we filed today, we do list out the buckets of all the action areas. And you’ll see that the vast majority of the charge and the savings are going to come from ops and technology optimization, which we’re really excited about. We think that those actions, those investments will lead to sustainable productivity improvements and savings over time. And just to give you some examples of where we expect efficiencies to come from streamlining our mid- and back-office processes, consolidating and upgrading technology platforms that should drive automation, consolidating vendors and then expanding our shared service model. And I’ll also note that the investments that we’re accelerating in our data and analytics, we think will help us innovate faster, serve clients with more distinction and help us further differentiate ourselves from our competitors.
So we’re very excited to kick this program off.
Mike Zaremski: And that, just a clarification. The margin guidance for next year is exclusive of the charges, correct?
Jeremiah Bickham: Correct. Correct.
Mike Zaremski: Okay. And as a follow-up, in the prepared remarks, Tim, and I think you touched on it in Elyse’s question, mentioned property was very strong in the latter half of 4Q. And just given — is that continuing into ’23. And you guys are very clear about some of the headwinds into the first half of the year. Just curious if that strong — better than expected property tailwind has persisted a bit into the first part of the year.
Tim Turner: It certainly has. It continues to increase in submission flow rate. The entire channel is growing and expanding rapidly. We’re seeing the start of the conversion rates picking up, and we expect that to continue. Reinsurance treaty renewals are expected to be very difficult for 41 and 71, and we see more dumping and shedding of CAT property business in the standard market flowing into our channel.
Mike Zaremski: But just as a follow-up, just to be clear, you’re saying, though, you’re not seeing much price acceleration in the E&S marketplace inclusive of property, which may be seeing some pricing hardening.
Tim Turner: Well, we’re definitely seeing the increases in CAT property, but the entire flow of business in property and casualty and E&S ebbs and flows. So we have some moderating, some price deceleration, but we see prices going up in certain classes like transportation, habitational, healthcare, sports and entertainment, higher education rates continue to climb and terms are — continue to be difficult in those long-tail casualty classes.
Operator: The next question is from Rob Cox of Goldman Sachs.
Rob Cox: So it looks like just on the margin guide that the midpoint is lower than where you were at for 2022 and double-digit organic growth, the tailwind of a fiduciary investment income. So I’m just wondering what the offset there is you talked about talent investments. Is that the only thing that’s really offsetting the margins here? Or is there other investments you’re making?
