Alan Schnitzer: Yes Brian, we watch for that all the time, and as you can see in the webcast, in the blue lines we give you, you can see it’s been very stable across the select business and the middle market, and obviously those add to the total BI business. It really is a function of nominal GDP – you know, economic growth and overall inflation levels, and clearly we’ve seen the consumer-type inflation correct somewhat from the peak of mid-2022. Where we’re really encouraged, when we also look at our audit premium which is more of a going backwards view in our core middle market business, we continue to have real strong audit premium also, so both backwards and forward, we’re encouraged with how exposure is playing out in the business and we’ll continue to report out what we see with that line.
Operator: Your next question comes from the line of Michael Zaremski from BMO Capital Markets. Please go ahead.
Michael Zaremski: Hey, great. Good morning, guys. First on business insurance segment, heard loud and clear the comments about written margins expanding. Does the definition of written margins include reserve changes, because I’m just trying to–you know, when we look at the loss ratio, maybe I guess ex-cat, we clearly see that [indiscernible] that reserve releases or additions or whatever, right, are worse year-over-year, and clearly margins are good. I’m just trying to–you know, does written margins mean–are you looking kind of forward-looking or backward-looking? Any color there? Thanks.
Dan Frey: Yes Mike, it’s Dan. Just to clarify for you, so when we’re talking about margin in that context, we’re talking about the underlying combined ratio, so leaving to the side catastrophe losses and leaving to the side prior year reserve development. The only other comment I’d make in that regard is when we do see changes in prior year development, we do roll forward our thinking in terms of does that impact our view of current year loss and go-forward loss, but PYD itself as its booked, whether it’s favorable or unfavorable, is outside of that context when we’re talking about underlying margins.
Michael Zaremski: Okay, understood, and just a quick follow-up, then. Have you changed your view of forward-looking loss after this quarter, and you also called out the topping off of the asbestos and environmental–I think you used the word, topping off, but you kind of called out an additional add, and I don’t know if you want to call out specifically what that dollar amount was. Thanks.
Dan Frey: Yes, so I don’t think we’ll split the asbestos charge beyond that, but what we wanted to get across was we did our sort of traditional deep dive in the third quarter, that resulted in a figure for which we would have strengthened the asbestos reserve. We chose also to, if you think about it in simple terms, as moving higher in the range of possible outcomes for asbestos, and so we’ve put some money on top of what the analysis otherwise would have told you for the quarter. Then in terms of the first part of the question, we’re looking at all the factors that go into loss trend every quarter, including favorable or unfavorable PYD. There are generally small puts and takes on a pretty regular basis, nothing terribly significant in this quarter in terms of our view of loss trend.
Operator: Your next question comes from the line of Yaron Kinar from Jefferies. Please go ahead.
Yaron Kinar: Thank you and good morning. I guess my first question is on workers’ comp. We saw a premium decline there year-over-year. Are there any one-time items there or is it just an indication of market conditions and maybe rate compression? Maybe you can tie that into how you’re viewing this line of business and your thoughts about that into 2024.
Greg Toczydlowski: Yes, good morning Yaron. I think you’re referencing the slight down in the net written premium for the quarter. I would point you to year-to-date – it is just up 2%, so it wasn’t a meaningful change for the particular quarter, and obviously where you’re seeing not the level of net written premium growth on the other product lines that we’re seeing in workers’ comp, is clearly the rate pressure that the entire industry is seeing there. That rate pressure is driven based on the bureau’s loss cost recommendations that continue to put minuses across the industry, and that’s just an indication of the health of the line. We’re the largest workers’ comp writer in the country, and on a calendar year basis we feel terrific about the results of that, and that’s basically what’s driving some of that net written premium change that you mentioned.
Alan Schnitzer: Yes Yaron, just to be clear, we feel great about the workers’ comp line, we feel great about our results this quarter, this year, and we feel great about the outlook.
Yaron Kinar: Got it, thank you. Then my second question, also on BI, did you have any CYPQ there, because I did notice that the underlying loss ratio was flat year-over-year. Just given the rate commentary and RPC commentary, I would have thought maybe we’d see a little bit of improvement there.
Dan Frey: Yes Yaron, it’s Dan. A little earlier in the call and in Greg’s comments, we called out that we did see some benefit from earned price, but half a dozen other things that would happen in any quarter, could be some good guys, could be some bad guys, could be mix, could be base year, could be non-cat weather, there were some favorable and some unfavorable that netted to a modest unfavorable to offset the pricing benefit, but nothing significant there.
Operator: Your next question comes from the line of Paul Newsome from Piper Sandler. Please go ahead.
Paul Newsome: Good morning, thanks for the call. I wanted to ask if you could help me think more about the cat load prospectively, and one of the things I was wondering about, and this may go to the definition of how you think about cat [indiscernible], is if inflation is effectively pushing losses that otherwise in the past would not have been cat losses, been in the cat designation, and that may be what–how much of that may be part of why the cat load may maybe go up. Just any thoughts on that would be great.
Dan Frey: Sure Paul, it’s Dan. I’ll start. I think the second piece of the question, the answer would be yes to the degree that some of what we’ve seen in higher cat losses is the impact of inflation over the last several years, and just the value of those claims going up. So yes, over time more things would fall into what would get designated as, quote-unquote, catastrophes, given the threshold. Other than that, thinking about cats, we’re looking at long term weather trends, medium term weather trends, near term weather trends. We’re putting more weight on nearer term weather trends and, as both Greg and Michael have talked about, trying to react with very strong pricing, changes in terms and conditions, and risk selection where we think it’s appropriate.
