The paragraph is from Assurant's Third Quarter 2024 Conference Call and Webcast. Operator Sean Moshier introduces the event, mentioning key participants including Keith Demmings, the CEO, and Keith Meier, the CFO. The company released its Q3 2024 financial results after the market closed the previous day, and relevant documents are available on their website. Moshier highlights that some statements made during the call are forward-looking and subject to risks, referring to additional information in their SEC reports and financial documents. Non-GAAP measures will be discussed for performance evaluation. The paragraph ends with CEO Keith Demmings noting strong year-to-date performance, with a 15% increase in adjusted EBITDA and a 21% rise in adjusted EPS, excluding catastrophes, over the first nine months.

The article discusses the company's strong performance in Global Housing and Connected Living, with expectations to surpass previous forecasts. Despite challenges like increased investments and unfavorable foreign exchange affecting Connected Living, the company anticipates low double-digit growth in adjusted EBITDA and a mid to high teens increase in adjusted earnings per share. Global Lifestyle's performance remained flat due to elevated claims and a 2% negative foreign exchange impact. Investments in new partnerships, including a new innovation center near Nashville, have contributed to a 3% year-to-date increase in Connected Living adjusted EBITDA, or 11% excluding these investments, highlighting the use of automation and AI to enhance value and growth.

The Nashville facility highlights Assurant's focus on innovation and strong partnerships, particularly benefiting mobile clients. The company launched a new program with Chase Card Services on October 1, offering comprehensive travel and purchase protection benefits to Chase Card holders. Looking ahead to 2025, Assurant anticipates new client programs requiring additional investments. In the Global Automotive sector, despite experiencing high claims costs in vehicle service contracts and GAAP products throughout 2024, there are signs of improvement with stabilizing claims severity and moderating claims inflation. Assurant has taken rate increases and partnered with clients to reduce claims exposure. The company is focused on improving Auto results, leveraging moderating inflation effects, and remains optimistic about long-term growth. The paragraph concludes with a shift of focus to Global Housing.

The paragraph highlights the company's efforts and performance in processing claims for policyholders affected by recent major hurricanes, emphasizing their essential role in the U.S. mortgage industry by providing lender-placed insurance to mitigate the risk of uninsured losses. It notes strong year-to-date results, particularly in their homeowners' business, with a 34% earnings increase excluding catastrophes. In the lender-placed business, growth was sustained through competitive advantages like expense leverage and new partnerships, resulting in an increased placement rate. Policy growth was notable, especially in states with challenging insurance markets. Additionally, the company's renters' segment showed growth, driven by expansion and technological innovations in their Property Management Company channel.

The paragraph discusses Assurant's business performance and future outlook. It highlights the success of Assurant TechPro and Cover360, which have improved market penetration. The company's housing business has shown resilience and strong performance across different economic conditions. Due to strong year-to-date results, Assurant expects full-year growth in adjusted EBITDA and earnings per share, excluding catastrophes. The company anticipates strong growth in Global Housing and modest growth in Global Lifestyle due to investments in Connected Living. Assurant's performance reflects a multi-year transformation, focusing on specialized markets with long-term growth potential, particularly in lifestyle and housing. With leadership positions and competitive advantages in protection solutions across various sectors, Assurant is positioned for continued success through highly integrated B2B2C partnerships and a capital-efficient business model.

The paragraph discusses Assurant's strategic transformation to boost long-term performance and cash generation, which has attracted partnerships with large clients and improved capital efficiency. The company boasts a history of outperforming the property and casualty market, with projected growth rates of 11% for adjusted EBITDA and 17% for adjusted EPS since 2019. They see potential valuation upside compared to the S&P 1500 P&C Index. Keith Meier, the CFO, highlights progress in growth, innovation, and financial performance through expense efficiencies and technology while maintaining a strong capital position to support long-term value and growth. Their B2B2C partnerships are emphasized as the core of their business model driving growth.

Over the past year, the company has made significant strides by renewing major U.S. mobile client contracts, forming new partnerships, and enhancing programs with existing clients. They have focused on expense management and operational efficiencies by leveraging automation and digital technologies, resulting in improved customer experiences and profitable growth. Notable initiatives include a new device care center in Nashville and technological investments in their Global Housing sector, which have led to better expense ratios and operational efficiencies. Despite challenges like a volatile macroeconomic environment and higher catastrophe losses, their strong capital position allows them to plan a $300 million shareholder return through share repurchases in 2024.

The paragraph discusses the company's strong financial performance and capital management in the third quarter, highlighting an 8% growth in adjusted EBITDA and a 9% increase in adjusted earnings per share, excluding catastrophes. They generated $160 million in segment dividends and maintained $636 million in holding company liquidity, returning $138 million to shareholders, including $100 million in share repurchases. Year-to-date, they have repurchased $200 million in shares. In Global Lifestyle, adjusted EBITDA decreased by 4% due to increased investments aimed at future growth, particularly in global mobile protection programs, despite unfavorable foreign exchange impacts. Global Auto earnings experienced a slight decline due to losses in ancillary GAAP products, which were somewhat compensated by higher investment income.

The paragraph discusses the financial performance of a company's various segments. In their vehicle service contract business, claims due to inflation have stabilized due to previous rate increases, while Global Lifestyle saw a 7% growth driven by Connected Living, which benefitted from new programs and subscribers. The company anticipates moderate EBITDA growth for Global Lifestyle, offset by lower results from Global Auto and unfavorable foreign exchange rates. For the fourth quarter, Connected Living is expected to see increased contributions due to seasonal trends and new partnerships. Global Housing reported a third-quarter adjusted EBITDA of $92 million, with significant policy growth influenced by higher placement rates and increased premiums, along with favorable reserve developments.

The paragraph discusses financial performance and expectations in Global Housing and Corporate for the full year 2024. Global Housing saw strong results, especially in the renters business, with double-digit premium growth, and expects continued adjusted EBITDA growth excluding catastrophes. Factors such as top-line momentum in homeowners and lower reinsurance costs contribute to this outlook. The impact range of Hurricane Milton's claims is estimated at $75 million to $110 million. In Q3, Corporate experienced a $30 million adjusted EBITDA loss, up $4 million from the previous year due to increased expenses, and projects a full-year loss of $115 million. The company generated $556 million in segment dividends so far and remains focused on supporting business growth and returning capital to shareholders. Overall, they express satisfaction with their 2024 performance and optimism for 2025.

The paragraph discusses the company's outlook on reinsurance and pricing for their Global Housing business in 2025. Keith Demmings expresses confidence in their current reinsurance program, noting that despite an active storm season, they haven't utilized their reinsurance tower, which should positively influence their relationships with reinsurers and help maintain stable reinsurance costs. They have a stable panel of 40 reinsurers and expect pricing to remain relatively stable moving into 2025. Keith Meier adds that they are evaluating the structure of their reinsurance cat tower and will provide more details in February. They aim to maintain a retention level for probable maximum loss at $150 million, and having not needed to access the tower this year is considered advantageous for future rate negotiations.

The paragraph discusses expectations for the company's performance in 2025, particularly in the Global Lifestyles segment. Keith Demmings emphasizes that while precise guidance will be provided in February, there is an anticipated acceleration in growth, particularly in Connected Living, thanks to previous investments. The Auto segment is also expected to benefit from prior rate increases and stabilizing inflation. Although some additional investments similar to those in 2024 are planned, these are for new clients and program launches yet to be disclosed, indicating potential further growth. Overall, the investments from 2024 are expected to generate revenue and EBITDA in 2025.

The paragraph discusses the outlook for the housing market in 2025, noting expectations for solid underlying growth due to increased policy counts, rising average insured values, and improved expense leverage. The speakers also discuss continued momentum in the voluntary insurance business, highlighting a 6 basis-point sequential and 18 basis-point year-over-year increase in placement rates. Growth is attributed to new clients, expansion within the existing client base, and more policies being placed as homeowners face challenges in obtaining traditional voluntary coverage.

The paragraph discusses the drivers of growth in placement rates, highlighting the influence of a hard market rather than broader economic challenges. It reports steady growth in domestic business and mentions new products launched with a major cable partner contributing to momentum. In the Asia-Pacific region, growth is characterized as a natural evolution. The conversation also touches on higher-than-expected GAAP losses, which are expected to be short-term and are being mitigated through strategies like reducing risk participation in written premiums. By 2025, improvements in Auto are anticipated due to these actions.

In the paragraph, Keith Demmings and others discuss the current state of their business operations, focusing on the reduction of risk in auto insurance and the potential impact on future financial performance. They mention a strategic shift that began two years ago, aimed at reshaping risk relative to GAAP, leading to a significant reduction in risk exposure. They anticipate that by 2025, the impact of this adjustment will be minimal. Additionally, they discuss subscriber growth in the Asia-Pacific region, noting that monetization opportunities remain consistent with traditional models. Investment spending in Connected Living amounts to $21 million so far this year, with plans to transition this spending towards new programs in the future.

The paragraph discusses the company's investment spending, amounting to $21 million year-to-date, with $8 million in the third quarter and expectations for a slight moderation in the fourth quarter. For 2024, two-thirds of the spending focuses on launching new clients like Telstra, Spectrum, and Chase, while one-third is dedicated to automating and investing in a new device care center. These initiatives are expected to generate revenue, EBITDA, and efficiency benefits without recurring costs. The company plans to discuss future investments in February, emphasizing meaningful ones with strong payback. The commercial momentum, especially in Connected Living, is strong. Tommy McJoynt asks about the fourth quarter's strength in Connected Living, considering trade-in volumes and the iPhone upgrade cycle, and whether this strength can be sustained in future years.

In the discussion, Keith Demmings and Keith Meier address sequential growth expectations for Connected Living, citing trade-in seasonality and the launch of new clients as factors. They mention slight improvements in expenses and revenue, along with seasonal loss improvements in the retail service contract sector, which contribute to this growth. Keith Meier notes some softness in trade-in and promotional activity during the third quarter but anticipates increased promotional efforts in the fourth quarter, especially following new iPhone launches. John Barnidge from Piper Sandler raises a question about applying past profitability improvements from Global Housing to the Global Auto sector and asks about the potential for favorable reserve development over time due to rate increases.

In the paragraph, Keith Demmings discusses the company's experience in handling elevated losses in different product cycles, particularly in auto and housing. He emphasizes the importance of aligning interests and effective contracting. While auto insurance presents unique challenges due to its longer-term nature, lessons learned from the housing sector—such as simplifying the business and increasing operational efficiency—are being applied to auto. The goal is strengthening the business to create long-term benefits, though major changes in reserving releases are not expected. Keith Meier adds that such challenges improve the company's rigor and actions. The company has implemented 16 rate changes with clients and redesigned products to better serve consumers, using various strategies tailored to the specific challenges of auto versus housing.

The paragraph discusses Assurant's strategy of leveraging relationships with major brands and distribution channels to capitalize on cross-business opportunities. John Barnidge highlights Assurant's success in various sectors, specifically mentioning the partnership with Chase. Keith Demmings and Keith Meier respond by discussing the potential for bundling services, such as mobile coverage, with other offerings like global housing. They emphasize Assurant's strength in B2B2C operations and existing partnerships with banks and mobile operators, particularly in the UK. The paragraph concludes with a positive anecdote about Chase conducting reference checks on Assurant, which yielded favorable feedback.

The paragraph involves a discussion where Keith Demmings expresses gratitude for attending the session and anticipates a future meeting in February, during which they will discuss year-end results and offer guidance for 2025. John Barnidge also thanks the participants, and the operator indicates there are no more questions in the queue. Keith concludes by wishing everyone a great holiday season.

This summary was generated with AI and may contain some inaccuracies.