Alex Scott: Got it, thank you. The follow-up I had is on the auto insurance specifically. You obviously showed a good amount of improvement, which is great to see. How much of that is driven by the severity beginning to calm down, or stabilizing at least? Any color you can provide on those trends, and maybe specifically even repair and what you’re seeing there?
Michael Klein: Sure Alex, it’s Michael. I’ll just clarify a couple of things I said earlier. It really is the acceleration of earned pricing, earning through and driving that underlying improvement. But when you think about the external trends and external costs, it definitely is also a result of those external trends moderating. We had been talking about double-digit loss cost trends particularly in the physical damage space for quarter upon quarter upon quarter. Those trends moved into the single digits this quarter, so it was really both the earned pricing and the moderating trends driving that improvement.
Operator: Your next question comes from the line of Scott Heleniak from RBC Capital Markets. Please go ahead.
Scott Heleniak: Yes, good morning. Just wondering if you could comment on the recent proposed reforms in the State of California, really to keep private insurers in the state from leaving the state. Do you think that the initiatives there are appropriate? Do you think they’re enough, and does that impact your strategy there either way, in either direction? Just any overall kind of first views on some of the proposals out there.
Michael Klein: Sure Scott, it’s Michael. I’ll share a couple of thoughts. First of all, the idea of regulatory reform in California is positive news. That said, I really don’t think there are enough details available to evaluate. You’ve got a framework that the governor has asked the commissioner to take action on, but the details underneath that framework and how it’s going to be implemented have yet to be defined, and so deciding whether it’s a net positive or not and what actions to take as a result, there just really aren’t enough details yet to evaluate that further. But we certainly are encouraged by the fact that California is considering regulatory reform, and we think it’s long overdue.
Scott Heleniak: Okay, understood. Thanks.
Operator: We have time for one more question. Bob Huang from Morgan Stanley, please go ahead.
Bob Huang: Thank you. Most of my questions were answered, but maybe just one thing. You mentioned on the prepared remarks about tech investments. Can you possibly unpack that a little bit – what are the key technological aspects that you’re focusing on in terms of the investment? I’m assuming cloud is always going to be a big part of your investment, just given that it is a consumption-based expense model, but are there other IT capabilities that you would like to call out?
Alan Schnitzer: Bob, good morning, it’s Alan. Thank you for the question. We would be really happy to take this offline with you. We’ve talked really extensively about this over a long period of time, but broadly, the investments that we’re making across the organization fall into three buckets: one, extending our lead in risk expertise; two, providing great experiences to our customers, agents, brokers and employees; and three, optimizing productivity and efficiency. That happens in a lot of different ways at the enterprise level and it happens segment by segment. At the enterprise, broadly speaking it’s digitizing the value chain, digitizing the customer journey, modernizing the foundation, advanced analytics, automation, faster speed to market, getting the right price on the risk, things like that.
In terms of what’s going on in the businesses, it’s partner integration, sales and service, better front end for customers. It’s on and on. It is–it’s focused and it’s ambitious, but it also covers a lot of ground. We’ve talked a lot about it extensively and we’d be happy to meet with you and share more.
Bob Huang: Okay, thank you for that. Maybe just a follow-up on worker’s comp, and apologies for belaboring the point on this, is it possible to maybe unpack a little bit in terms of how the loss ratio looked like for workers’ comp versus other parts of business insurance? I’m assuming this does not impact your loss cost trend of 5.5% to 6%, but just curious if you can give a little bit of details there.
Alan Schnitzer: Yes, we’re not going to break out the losses by product line, but it certainly is wrapped in the overall number that we’ve talked about historically.
Bob Huang: Okay, thank you.
Alan Schnitzer: Thank you.
Operator: Thank you. Ms. Abbe Goldstein, I will turn the call back over to you.
Abbe Goldstein: Great, thanks everyone. We appreciate you joining us today for our call, and as usual, if there’s any follow-up, please feel free to reach out to Investor Relations. Have a good day.
Operator: This concludes today’s conference call. Thank you for your participation, and you may now disconnect.
