So it’s early in the process. We’re obviously having those early conversations and we’ll be fluid as we go through that process and ultimately make a decision.
Operator: [Operator Instructions] You next question will come from the line of Bob Farnam with Janney.
Bob Farnam: So not to pile on with the general liabilities, the reserves. But I’m just trying to get a feel for, do you sense litigation funding is backing some of the claims that are coming through your book of business? I wasn’t quite sure if it’s the size of claims that — for you versus maybe some of your peers. Just kind of curious if you’d get a sense that litigation funding is behind things?
John Marchioni: Yes, I think litigation funding is an impact across the board. I’m not going to suggest that it’s the primary driver, but I will say litigation funding is not just about the real high exposure cases on the product side. I think there’s no question that litigation funding is a little bit more broad than that. And I will say, when you look at our litigation rates, we’ve only seen a very modest increase in actual litigation rates, and that comment applies to both general liability and auto liability. But I think there’s no question. And in certain states, I think you see a much more active plaintiff bar and especially in states where you have a more challenging litigation environment where you see things like phantom damages are allowed, expanded premises liability exposures, expansion of liability theories that are statutory in nature.
I think that’s where you tend to see the litigation financing focus their investments. So I think it does impact accounts of all sizes and books of all sizes. But I think it’s all — there’s no question that they all are focused on larger limits, and our limits profile is a little bit below average.
Bob Farnam: Yes, that’s what I was kind of getting at. I didn’t know if having your $2 million under limits is as attractive as maybe some of the larger limit companies. Do you get a sense that going-forward you’re probably going to get even more maturity involvement with claims? Is that just seems to be like a trend that’s going to keep going up as long as the plaintiff bar is successful in this endeavor? You think that you’re going to be — basically be facing more litigation going forward?
John Marchioni: I think and that’s — one of the reasons we talk about the uncertainty going forward is because of our challenge as an industry to get behind what long-term social inflationary trends look like. Now this is nothing more than a data point. If you look at commercial auto, I think the severity impact from social inflation hit more quickly because it’s a little shorter tail. And we are seeing a little bit more moderation or leveling out of severity trends in commercial auto, but the pricing environment in commercial auto has also been stronger than it’s been in general liability. But that might be an early indication that these severities do find their level and settle out. But I also say that the trial bar is not going to stop.
The trial bar is going to continue to look for fertile grounds. And ultimately, you need one or two things to happen. You need legislative change, statutory change, whether that’s to unwind bad statute or to address bad case law or you need precedent setting case law that unwinds bad case law that exists in that state. From a public policy perspective, I think the industry is going to be fighting an uphill battle on that front until such time as this becomes a consumer-driven issue. And I think that’s the most important point is, in the near-term, this winds up impacting underwriting companies results. But in the relatively near-term going forward, it ultimately makes its way into the cost of goods sold and it’s borne by consumers, both personal and business consumers.
And I think once that connection is made more strongly and consumers start to drive this conversation, I think it changes the landscape relative to our reform on a state-by-state level.
Operator: And we have no further questions at this time. I’ll turn the call back over to John for any closing remarks.
John Marchioni: Well, thank you all very much for your participation. And as always, please feel free to reach out to Brad for any follow-ups. Thank you.
Operator: Ladies and gentlemen, that will conclude today’s call. We thank you all for joining, and you may now disconnect.
