We’ll leave it to you guys to figure out whatever you want to put into your models, but that’s what our plans call for.
Mark Hughes: Understood. And then, Mark, anything on the net investment income that’s relevant here?
Mark Haushill: Mark, we just talked about a $1 billion fixed income portfolio with a yield of 4.5. You and I can do the math. I expect that to continue throughout ’24. The other components can be a little bit more variable. So I’ll leave it to you to model out the portfolio in terms of fixed income. With the rest of it, you just — time will tell. But we’ve done well on opportunistic, but it has moved around a little bit, as you know, in ’23.
Mark Hughes: You guys are asking me to do a lot of work.
Mark Haushill: I can help you with that. If you want to send us your models, we can fill out your models. How about that?
Mark Hughes: Yeah. I know.
Mark Haushill: I am joking about that.
Mark Hughes: The global property — I hear what you’re saying, it’s not a seasonally strong quarter, but even on that basis, it was down a little bit year over year. You got a lot more meaningful growth earlier in the year. What — anything going on in particular in the fourth quarter?
Andrew Robinson: I genuinely, Mark, will tell you, don’t read it. It is — it would give you a false negative if you look at that. It’s a very, very light quarter. I think we let one account go. We also roll into that division and there’s no premium written for agro in the fourth quarter. And so I honestly — I can say with great confidence already knowing how we started the year that you don’t let that sort of give you a false negative. But obviously, the property market is — I think it’s either at its peak or maybe past its peak. But I feel very good about where we are and both the profit as well the sort of growth opportunities that are available to us, given our discrete focus there.
Operator: Our next question comes from the line of Andrew Anderson with Jefferies.
Andrew Anderson: Looking at the GPW growth from professional lines and transactional E&S, can you help us think about the source of growth there and how much of that is retained net?
Andrew Robinson: Yeah. Well, without knowing sort of the context to your question, I can only assume that given everything that’s being talked about in the D&O market and particularly the public D&O market, that probably underlies it a little bit, first off, everything is claims-made rules into our professional underwriting division. So our main drive line there is our miscellaneous professional, which, quite honestly, is relatively small face value, less than $1.5 million average limit. All types of classes included in that as well are things like employed lawyers, tech E&O, our excess lawyers offering. As you saw, we also did a media liability offering, including the professional portfolio as well is our architects and engineers book of business.
It also does include management liability, which I’ll come to in a second. And really, what’s been a big growth line for us is in the healthcare professional market. For management liability, just to maybe get in front of our conversation, look, I feel great about our management liability book. But I think it’s probably noteworthy that almost all of that today is private company. Less than a quarter of that is public. And of that, 70% is side A and 30% is side ABC. It probably has a 50% retention rate. We’ve been letting it go. And on the positive side on our management liability, like, we are ninja assassins going after very areas, right? So we’ve been very successful in areas like Web3, cannabis amongst others, which are true sort of specialty risks where we have some pretty darn legitimate expertise as compared to the rest of the market.
So our professional growth and our portfolio is very atypical of maybe how it is you would compare us against others. And then lastly, to your question, because our average limit is so low, we are principally keeping it net. It’s not entirely net, but it’s principally.
Andrew Anderson: Very helpful. Thank you. And maybe thinking about casualty loss picks here, can you kind of give us some color on how accident years 16 to 19 are developing, both for business within the LPT and non LPT business?
Mark Haushill: Sure, Andrew. Good question. Look, so I’m glad you brought it up. We — the industry is talking about the 19 in prior years. Good reminder, the LPT covered policy years 2017, which, of course, would include part of the 18 accident year. Before we went public, we took the LPT up to the co-participation limit. We’re not seeing any surprises on inflation and/or loss costs. We’ve talked about that. Our rate increases have exceeded what we think our inflation and loss cost trends are. And Andrew, we haven’t pulled that through in terms of our income statement. We’ve been conservative. Meaning, with loss picks, we’re not taking full credit for rate increases. That answer your question.
Operator: Our next question comes from the line of Meyer Shields with Keefe, Bruyette, & Woods.
Meyer Shields: One quick question, I guess, on the catastrophe load, I know it’s really, really light compared to most of your peers, but it’s also — at least the upper range is higher than you guys have produced in worse pricing environment. And I was wondering, is this intentionally a conservative outlook or is it something changing in terms of the overall mix of cat exposure?
