Operator: Our next question comes from the line of Gregory Peters with Raymond James.
Unidentified Analyst: Hey, good morning. This is Sid on for Gregg. When we look at your growth over the last two years, it looks like it’s really been driven broad-based, but more specifically in global property, transactional E&S and professional lines. So just hoping you can comment on the outlook from here. Should we expect the growth to be more balanced across your book? Or do you still see some more attractive opportunities in certain underwriting divisions versus others?
Andrew Robinson: Yeah, there’s no question about it that we will — first off, we’re big believers in micro cycles that — while the market is orderly in aggregate, as I mentioned, there’s certain areas where things just aren’t rational, right? And no matter how good you are, you’re going to have reduced opportunities to compete there. What I’d say to you is we certainly have taken advantage of the property market. You’d mentioned two areas. Surety has been another area that we’ve seen a lot of growth in. I feel that sort of our plans for this year are relatively widespread across our business and maybe less spikes in a particular area or particular areas. But inevitably, I think one of the strong features of this organization is that we’re really good at when we see a market opportunity to kind of reallocate our resources and jump on top of it.
And so I suspect that while the best laid plans are sensible, it’s probably not how the year’s going to play out for us. And I’m sure that will reflect back on 2024 with an error to where we had better growth than we expected and we’ll have a couple of areas where we have worse growth because the marketplace changed on us. I tend to find that our execution is not the reason that we’re not — like we’re always — we’ve always been very good at execution. So it tends to be more marketplace driven. But as I said, I think it’s more balanced and more widespread, sort of is our working assumption for this year.
Operator: Our next question comes from the line of Michael Zaremski with BMO.
Unidentified Analyst: This is Jack on for Michael. My question’s on reinsurance ceding levels. I know there were some gross to net premium lumpiness last quarter. I guess longer term, is the current 35% plus ceding level the right percentage to think about? Would you expect those levels to fall over time?
Andrew Robinson: Yes, I think that for — this is Andrew. For 2023, I believe that our gross to net number was — I’m not looking at — 62.7, I believe, in aggregate for the quarter — for the year, excuse me. I could be wrong in that, but right around that number. And I think our general expectations are that that’s a good number rolling into next year, original planning number. I think as you do — given our outlook for 2024, when you just run the numbers and you kind of apportion underwriting income and investment income, I think you’ll sort of tie back to that kind of low 60s gross to net.
Unidentified Analyst: And then I guess thinking about 2024, can you talk about how business — do you expect business mix to impact the loss ratio? I know that in 2023, a shift toward property put downward momentum on your attritional loss ratio. Just wondering about any color for 2024.
Andrew Robinson: Yes. So implied in our view is a relatively consistent loss ratio underlying. You just sort of back out what we’ve said about expenses and then take out cat and so forth, you’ll find that we’re broadly in line. And from a mix perspective, we have — we’ve definitely been shortening up our portfolio. So this — at this point at the end of 2022, I believe that 49% of our business or thereabouts was what we call short duration, less than two year liabilities. This year, it’s 53%. I think that as we look forward to 2024, it might go up a little bit more towards shorter tail liabilities. But that really — there’s not really much going on here in terms of mix that’s driving our underlying accident year. And there’s also not much going on in terms of our recognition of rate over loss cost trend going in there as well. We’re planning — our working assumptions are for something that’s relatively consistent.
Operator: I would now like to hand the conference back over to Natalie Schoolcraft for closing remarks.
Natalie Schoolcraft: Thank you, everyone, for your questions, for participating in our conference call, and for your continued interest in and support of Skyward Specialty. I’m available after the call to answer any additional questions that you may have. We look forward to speaking with you again on our first quarter earnings call. Thank you and have a wonderful day.
Operator: This concludes today’s conference call. Thank you for your participation. You may now disconnect.
