Morning, everyone, and welcome to BMO Capital Markets Fireside Chat with Trisura Group. I'm Tom MacKinnon, covering insurance, diversified financials, and asset managers here at BMO Capital Markets. This morning, we're delighted to have Trisura's CEO, David Clare, join us for a fireside chat. Good morning, David, and thanks for joining us. Yeah, thanks for having us, Tom. Yeah. Hey, let's just start with thoughts on the quarter. You know, versus us, it was a modest miss, but that just seemed to be on some seasonally higher corporate expenses. Yeah, outside of that, the underlying fundamentals were pretty good, at least in our opinion. What are your takeaways? Thanks. Yeah, I think that's fair, Tom. I mean, from our perspective, what we really wanted to keep demonstrating is the fundamentals, the operational metrics of the business, right alongside what we hope they'd be. I think if you look to the quarter, that consistency and profitability across the group, an 83% combined ratio, an 18% operating ROE, those are strong metrics and a real nice start to the year for us. I think if we look to some of the things that excite us, that continued growth in those primary lines, those lines that drive the majority of our profitability, surety, corporate insurance, warranty, that was a real highlight for us. And then, candidly, consistency and profitability across those fronting and programs lines. From our standpoint, if you add in nice growth investment income to the overall tenor of just good operating results across the book, we were very happy with the start to the year. Yeah, thanks for that. Yeah, when I look at the Trisura story, like three, four years ago, you always had a pretty steady, consistent, profitable Canadian specialty business. In my opinion anyways, what was really driving the growth and the multiple expansion was really just this rapidly growing U.S., programs business. That was primarily this fee-based fronting model that you had there. If you look kind of at the growth and the number of programs that you had in the U.S., they essentially kind of quadrupled from 2018 to 2022. Since then, the number of programs in the U.S., has been essentially flat. Why is that? Is this sort of a change in strategy? You've sort of talked about more muted growth, at least in U.S., programs. Is it a change in the markets there, change in your strategy, or both? Just your thoughts there. Thanks. Yeah, I think the biggest change in our U.S., programs business is, candidly, the fact that it's gotten a lot bigger. The maturity of that platform and the size of that entity makes some of those growth rates that you saw in the early years just less practical now as we're a larger part of that overall market. I think you've seen us consciously pull away from some parts of the market that we just view as inappropriate risks. Candidly, what you're seeing now is concentration and focus on what we view as the highest potential long-term partners. I think you're right. If you look at the number of our programs, it's sort of been relatively steady over the past couple of quarters, past maybe a year and a bit. What we've actually seen is the underlying programs that we are navigating or building with, they still have good momentum in the market. This is a continuation of a trend we identified five or six years ago, which is this secular growth in both the E&S market and the MGA market is very attractive, and it continues to be very attractive. We've carved out a niche. There's about $1.5 billion in U.S., dollars of our market share in this part of the space. We think within that, there's very, very attractive places for us to grow. That transition, I think it's kind of an evolution of Trisura overall. That transition from a really quickly growing entity, which you saw in the 2020 period, especially around our U.S. Programs, we've kind of grown into that next phase, which is we're a little bit more mature, we're a little bit more stable. We've got an outlook or a group of partners that we think we can grow very well with over the next coming years. That momentum of startup businesses, new launches, that's almost shifted a little bit, right? U.S., programs is now standing up on its own. We've shifted that growth trajectory to new launches now, which is U.S., surety, U.S., corporate insurance, right? If you look at the growth rates in those platforms, they kind of feel a little bit like we did a few years ago because they're smaller businesses and they're starting from a smaller base. Yeah, that's great. We'll get to the expansion of those lines in the U.S. in a minute, but just want to kind of finish up with some of the U.S., programs here. I mean, how do you see that business evolving? It sounds like you've centered it around the programs that are working and then getting more business out of the programs that are working. We can look for kind of net, it's really net premiums earned and your fees that are coming from those programs. If we were to look at trends here, do we have to, should we be looking at fees as a percentage of the net premium ceded? How have those things been trending in that business? Is that giving us any indication of improving profitability or declining? Or should we just kind of focus on net premiums earned growth and combined ratio improvement here for that segment? Just thoughts there about how you see that business evolving. I think there's naturally a very strong focus on fee income in this business. It is driving the economics of that group. If you look at ceded fees to earned premium there, you've got a pretty consistent trend in the high fours. I think we would expect this should be modeled at a 5% rate. That's been relatively consistent both through the cycle across admitted and E&S markets. I wouldn't change anything there. You're right, Tom, that the metrics that we're looking at now more and more should be familiar to traditional insurance investors, right? We originally started with this metric when we were a lower retention business, a front-end operational ratio. That's now moved into a more traditional combined ratio metric, which should be familiar to people who've been in the space for a long time, maybe familiar to people who are a little bit further away from the P&C space. If you're looking for trends, I think critical in the near term is looking at what the core growth of the ongoing portfolio is. This is an area where you're still seeing 16%-17% in growth in top line. You're still seeing very healthy growth in earned premiums. Those metrics for us are still very attractive and growing. That's what will be indicative of the ongoing strength of the underlying portfolio. If you combine that level of growth with the combined ratio that you've seen in the quarter, I think that sets up for a very strong contribution from both the top line and bottom line perspective for this business. Okay, great. You had a couple of stumbles. I guess one really just with a reinsurance recoverable issue on one of your U.S., programs. Is there anything, and it was a while ago, but kind of it's a bit of a hangover on the stock to some extent, at least in our opinion. I think you've worked your way through that. Is there anything you've learned in terms of risk management with respect to, say, who you're going to cede the business to? I believe this was kind of an agent-owned reinsurer. What have you learned with respect to the hiccups that you had with respect to that recoverable write-down a while ago? Yeah, I think, Tom, that catalyzed a few changes we've talked about quite a bit. Mainly, that's driven two things. One, a bit of that risk appetite statement that we referenced earlier, right? We're going to be very concentrated and specific in the types of businesses that we want to write and the types of partners that we'll bring on. If you look at the portfolio of business that we've had, some of the changes that we've made over the last couple of years, you've seen adjustments around the edges, right? We've grown through those adjustments, but starting in sort of 2021, 2022, you saw a real reduction in our exposure to concentrated CAT exposed property risks. That was the line of business that we had some issue with. It's just a more volatile line of business that I think we view as appropriate for our structure. You've seen a real reduction in that part of the business. I think you're right, that agent-owned reinsurance entity, which is clearly a smaller counterparty. We don't like that group or that style of group anymore, especially for CAT exposed property business. You've seen that really reduced in our business. Overall, if you look across the platform, you've seen, candidly, an expansion of infrastructure, an expansion of capital that's just driven a more sophisticated approach to everything that we do. If you look at Trisura five, six, seven years ago, the entity was smaller in every metric, right? Book value, earnings, diversification, people, scale. If you look at where we are today, some of those learnings we've had over the past five, six, seven years, they've all been implemented, right? You've got people now across the organization, you've got scale from a capital perspective, you've got more diversification, and you've got a platform both in the U.S., and Canada that is established in its space. All of those learnings, candidly, as painful as they are, they just make the entity stronger, right? It informs our risk appetite, it informs our behavior in the market, it informs how people view us. I think where we've come to is the Trisura that you see today is quite a bit stronger than the Trisura of any other period. Oh, that's great. If we go to now, you've built out a North American kind of specialty business. I like the way you've changed your structure for reporting. You have the programs separately, and then you have this, what used to be kind of more of a Canadian specialty, it's branched out to the North American specialty. You've been a big player in the Canadian surety market. How do you see this market going forward? Maybe talk about what would be your kind of secret sauce that you've been able to use in Canada to become a major player there. How do you differentiate yourself? What's your kind of secret sauce that you would have to be able to grow surety in the U.S., marketplace? Is it just an opportunity there? The pie's big and you'll just take what you can get out of that. Yeah, I think it's important to remind everyone, Trisura's heritage, Trisura's DNA is as a surety underwriting platform, right? We started in 2005 underneath Brookfield's private equity platform. One of the main focuses of the group was that surety underwriting. We built a practice in Canada from a standing start to the fourth largest surety vehicle in the country. This process of organically building a very specialized underwriting platform, it's one that we've been through before. Not to say that Canada and the U.S., are identical, but the secret sauce, as you referenced, it's important to note that we're starting from a group that has navigated both the underwriting, the building, the risk management, and the relationships that sort of inform this build-out. I think when we look across the North American surety market, it's a very attractive space, right? If you look at being able to underwrite in this business well, loss ratios can be very attractive. It is a very significant part of the overall economy from a construction standpoint. The contractors that we are working with are supporting infrastructure building across municipal, provincial, and federal governments. There is a need for this product across the country and I think a growing need for the products that we market. Now, if you look at the U.S., which is sort of our biggest potential growth area, the U.S., surety market is 10 times the size of the Canadian surety market. In no way do we think we're just going to enter this market and take a little bit of our fair share of the market. We are actively going into this market with a mandate to grow and an expectation for our people that we're growing the business in the same way we've done in Canada, which is growing with profitable underwriting. We have now been in that business for going on five years. You're starting to see the fruits of some of this labor come through, right? It's easy to sort of think about this business as a new entrant for Trisura, but we've been building our processes, our people, our approach in the market for the last five years. The secret sauce for us is really twofold. One, it's recognizing that relationships and the brokers that we deal with are very, very important. As a smaller player, we need to service those brokers very actively and very well, hopefully better than others in the market. That service mentality, that relationship mentality in the space is a very important metric for us in our growth platform. Putting that in the framework of growing profitably is as important or more. When we look at our underwriting appetites, our approach to the market, our risk profile, we're trying to grow in the smaller end of that market and we're doing so profitably, right? I think the best demonstration of that is after five years, you've now got a platform in the U.S., that's approaching or equaling our Canadian platform from a combined ratio perspective. That ability to navigate that broker community, navigate the relationships, and do so in a framework of very, very strong underwriting, that's the secret sauce. Candidly, you need a lot of people with a lot of experience to navigate it, and you need the appetite and willingness to grow in a very competitive market. I do not want to imply that surety is not a space where a lot of people want to grow, right? This is an area that most large insurance companies have a practice. Our approach is to hopefully service those brokers a little bit better than those larger groups. As you kind of moved into a new size category threshold, is that helping any potential growth in U.S., surety? I know sometimes these can be a bit of a step function. Once you get to a certain size, then you get the attraction of different kinds of distribution, or you can expand your distribution or your partners that way. Maybe you can enlighten us on some of the aspects with respect to that. Yeah, so you're referencing our step function change in our size rating from AM Best. We went from a size 9 to a size 10. That can be helpful and material depending on the stage that you're at. For us in the surety space, what's important in both the near term and the long term is candidly the size of your balance sheet and eventually the size of your treasury listing. The AM Best size 10 is helpful. Certainly, that credentializes the vehicle to go out and show our brokers and our contract partners that we're a substantial vehicle. We'd like to continue to see that growing, right? We want to see our treasury listed vehicle reach a larger balance sheet size. We'd like to, at some stage, be talking about what it takes to move the rating from an A - to an A. All those metrics will be helpful as we go along, but we have a good base of the business at our size 10 and A- rating. Anything we do to continue moving that just helps us in the market. It's something you'll hear us talk about probably a little bit later in the year. Our treasury listed vehicle, which we acquired last year, is now up to about $60 million in capital. We'd probably like to move that vehicle from $60 million to $100 million in the U.S. That's a, I don't want to say a benchmark, but an important threshold to get over. We've got the capital internally to make that happen. What you'll see as we continue to build out our licenses, we're now at sort of the mid-30s in the licenses in the U.S. As those licenses come on, as we see more premium coming on, we'll drop more capital in the vehicle, which is a signal for the market and an opportunity for us to do more business with a broader group of people. That setup in that U.S. space is very exciting right now. Yeah, that's great. I mean, this might dovetail into one of the questions that came up. It sounds like part of your growth strategy, at least in specialty in the U.S., is to drop down some more capital into that. You're underleveraged to some extent, but what about buying back any kind of stock? My impression would be you want to put that capital more to work to grow this U.S., business, maybe leverage up more, and potential share buybacks would be further down the list then. Do I have that right there? Comments there? Yeah, our first priority is obviously organic growth. Organic growth is candidly the most creative, attractive way for us to deploy capital. That reference that I am making to growing the capital base in the U.S., I think you are right. We are underleveraged now. We have got a lot of capacity to be dropping capital in. We are producing returns at a high teens ROE. That allows us a lot of levers to lean into this business. What we would like first and foremost is to make sure that we are capturing those organic opportunities, the first of which will be growing a little bit of that balance sheet size in the U.S. I think we have had a lot of questions around those share buybacks since we introduced that tool. I do want to reiterate those organic initiatives will be first and foremost on that list, but we do have ability or capabilities now to consider those types of levers or those tools further down the line as we think about other versions of capital repatriation. Yeah. Hey, maybe just a question on what you're seeing with respect to the surety market. You know, often you think this depends on infrastructure spends, and sometimes that can kind of be a bit more government-driven. Just thoughts there. What are you seeing in terms of the market outlook on that? Yeah, it depends on which part of the market you're looking at. I would say the vast majority of our Canadian surety business is in contract surety, which is contractors supporting infrastructure construction in, again, municipal, provincial, or federal governments. That space has been fairly consistent for us. We've seen good growth. We've seen an impact from inflation, but contractors generally being able to navigate those impacts. Really interestingly, this new Liberal government that came in, a number of their initiatives focus on continuing to support and spend in the infrastructure space. Candidly, we would love to see that. It would be a nice catalyst for the overall industry. We've got a relatively significant infrastructure debt in the U.S. If you think about a lot of their major versions of infrastructure, many of them need upgrading. There's this almost pent-up or backup of demand in the infrastructure construction space that we think the surety market is well placed to capitalize on. I would say we should acknowledge parts of this market are under stress right now. We are a relatively small participant, probably single-digit percentages of our surety group is in the developer space, which would reference or relate to the condo market. That, again, is a space that's been very slow. You're not seeing a lot of new developments being built. That's not a big area of growth for the entity. In general, I would say this market, this contract market, and even the commercial market has been pretty consistent and one we think continues to grow. Question here with respect to you get Intact into Divinity. I mean, they're rolling up brokerages to some extent that probably a little bit more personal lines focus, but there's certainly some commercial lines that they would be doing. How do you think that plays in? Do you see that as a competitive advantage for players who don't vertically own brokers and commercial lines? Yeah, for us, and I would differentiate commercial and specialty lines here because you're right. Where most of these players start is in the personal line space and then maybe expanding a little bit into the commercial distribution in the more commoditized lines. For us, in these specialty line spaces, it's really important to be viewed as a partner to your specialist brokers and not be competing with those brokers by owning distribution or vertically integrating. For us, Trisura is a real independent alternative for many of these groups. That can help us both differentiate. It can help us when we see the larger groups rolling up practices. We definitively are not in the distribution space. We think that's candidly a real marketing point for Trisura with our brokers. The difference to always remember about Trisura versus some of these larger platforms is we are only a specialty entity, right? These larger platforms are being driven by personal lines, commercial lines, and then maybe they have a specialty practice on the side of that. Our entity is very unique in its focus on those specialty lines, and it is really important to be viewed as a partner to those brokers in that space. That is how we built the business, right? This independent platform that is not competing with brokers, but partnering with them. Yeah, yeah, I agree. If we were to, let's talk about some of the other lines in North American specialty. When I think of corporate insurance, like its directors and officers there and admission, what's your target market like in this line in Canada? Talk about any traction you're getting in terms of trying to expand this south of the border. Yeah, so in Canada, we generally play, and again, these I would say are not specialty products. If you think about E&O and D&O, many insurance companies offer these. Where we qualify them maybe as a specialty practice is the types of clients that we're focused on, right? These are not public companies. They are private enterprises, charitable boards, small businesses, stuff that takes a little bit more expertise to both underwrite and originate business. That's our practice in Canada. That's why you'll likely never see Trisura as the largest E&O, D&O writer in the space. We're not going to be writing, let's say, a bank's public company D&O practice. That's not where we play. We think there's a really attractive practice in that smaller mid-market space and a bit more consistent and better profitability in those lines of business we write. That appetite, that private and charitable board space, the small business area, that's exactly what we're replicating in the U.S., right? Again, that same narrative that we talked about in surety, but the U.S., being substantially larger in the surety space than the Canadian, that exists in corporate insurance as well. As we go out and look to build market share or practice in that U.S., corporate insurance space, we will be playing in those same markets as we do in Canada, right? Not public company, not large complex risks, but those smaller private enterprises and charitable boards, those are the areas that we play, and there are a lot of them in the U.S. What we're doing right now, it's slow, right? You're building a business as you're taking out the infrastructure. We are planning on five-year and ten-year timelines for this to be a significant contributor to Trisura in that medium term, right? When we talk about surety, you have got a practice now that is starting to approach at least a significant scale compared to our Canadian business. In four to five years, we want that corporate insurance practice to be the same, right? You have stood up a business organically that can contribute the same amount, at least on a top-line basis, to our Canadian business. I think what is important to highlight here is you are not going out and building practices or changing risk appetite. You are trying to replicate the success you had with the same formula of underwriting risk management market approach in Canada and the U.S. Oh, that's great. In terms of the distribution there, if you're looking at the SME corporate, is it still like the big Aon and Gallagher or any of those big and Brown & Brown? Any of those big brokers? Or who do you kind of deal with when you're looking at a smaller, not public, almost nonprofit company for D&O and E&O? Yeah, I would say some of those alpha houses that you referenced, they're going to be in every part of the market. Where we tend to have higher wallet share is large regional players or specialist brokers. If you think about that next level down of brokers, the Lockton, the Hub International, those types of players, we tend to line up very well with those groups, right? Hub would be one of our largest partners here in Canada. BFL Canada is another great example of a really strong partner for us. In the U.S., if you've got a group like Lockton, that one level down from the Aon and Marsh, we tend to focus on those regional players because that's, again, the groups that are more likely to have the accounts that we're interested in writing and the groups where that relationship-driven approach and that specialist underwriting expertise gets a little bit more traction. Listen, take a step back. In the long term, a real opportunity for Trisura at some stage is building with those alpha houses, the Marsh, the Aon of the world. They're massive players in the surety space. They're massive players in E&O, D&O. Today, as we launch our businesses, especially in the U.S., they're not going to be the biggest opportunity, right? They're going to move into an opportunity in time, but the regional players is where we're focused. Two other lines in specialty in North America. I guess one is kind of more Canadian focus. You've built out a fronting business here in Canada now. What's the appetite for the reinsurers for that? How is it different from the U.S.? What's your strategy to really grow in that? It does grow kind of lumpy, but I guess at times it can work. Thoughts there? Yeah, the Canadian fronting business is interesting, right? We started this business back in 2020 originally on the thesis that we'd see an expansion of growth in the MGA channels in Canada. The opportunity we found ourselves getting a lot more traction in instead was foreign reinsurers. Reinsurers outside of Canada who wanted access to the Canadian market. That appetite was substantial. What we found ourselves working with is almost structured access to the Canadian market in partnering with foreign capacity providers. That is a different nuance or a different posture than the U.S., where really your top line or your business is being driven by the secular trend of investment and growth in the MGA space in the U.S., and then going out to structure or create panels of reinsurance behind it. Here, it's almost turned that on its head where the panels, the capacity, that's what's driving the demand here. We're working with those groups to provide access to the Canadian markets. You're right. It's lumpy on the top-line basis, but where we focus is really that consistent quarter-over-quarter profitability. Strategically, I think some people might not appreciate this from the outside in, but strategically, as we bring these capacity solutions into the market, as we're seen as a big partner, that makes us more relevant with brokers across our relationships, which drives momentum in the other pieces of our business, right? This fronting piece, which again, it's important to know we stood this up from nothing five years ago into a really strong contributing practice this year. I shouldn't say this year, over the last couple of years. That now gets us more touch points with the brokers we work with. That gets us more opportunities to do more in those core lines of business. It becomes helpful to the ecosystem. I think this is a line of business. We talked a little bit about this in Q1. You tend to see lumpiness in timing, in relationships of the business, but strategically and economically, we think this has been a really strong practice both to stand up and to continue contributing to the overall business. No, I think if it's driven from the reinsurers, I think that's probably you're in a better position here. It's really what I find the businesses often be. If it's driven from MGAs, then you're searching for capacity solutions to it. Now you've got the reinsurers saying, "We would like some of this business." I think it's better for you're in a better position there. You've already got the relationship with the reinsurers, and then you can expand your relationships with MGAs. I think that's probably in a better position. You just want to make sure that the foreign insurers that you're dealing with, I guess, have the necessary capital or lines of credit or whatever they're going to need in terms of making them lowering any kind of potential risk you might have in dealing with them. Do I have that right? Yeah. First and foremost, I would say the U.S., market has versus this, right? There are reinsurers who are very attracted to program business, MGA business as a diversification tool, as well as a specialization tool. The nuance is not probably as black and white as we're referencing, but I agree. It's a great posture, a great starting point when the reinsurer is saying, "I want this market and I don't want to participate with you." What's really interesting about the Canadian market, Tom, from your point on risk management, the vast majority of our partners are A-rated partners in this space. On top of that, the regulatory environment in Canada forces those A-rated partners to also provide collateral. You have a very strong regulatory environment, a very strong infrastructure set up around this business, which makes it very attractive for us. If you layer on top of that the strategic benefit of working with distribution partners to package analogous risks together and to be seen as both a conduit and partner for capacity, that's helpful for the overall business, right? That lets us punch a bit above our weight with the market. Yeah, that's good. Just the last line, I guess, is this warranties business. It sounds like what type of warranties here? There's probably more cars than I think or auto warranties here than investors might realize. Electronic stuff, others. It's mostly. Outlooks there. Yeah. Yeah, it's mostly the auto, Tom. These are aftermarket auto warranties. Important to differentiate between original equipment manufacturer warranties. These would be warranties you would purchase from a dealer group or a dealer that are extended warranty products, excess wear and tear products, the types of products that aren't necessarily provided by the manufacturer themselves, but are add-ons to your car purchase. That is effectively the vast majority of that warranty business. I think this is a practice where we've seen some momentum over the past few quarters. We've been successful in launching a few new programs with existing partners. We've been successful in taking a bit of market share. We're still a smaller player than some of the large groups in this market, but you've seen from a top-line perspective the level of growth in this platform over the past few quarters. I think the outlook here is, we think, very positive. We sort of set out the year thinking this would be about a 20% growth business for the warranty practice. It was a far higher growth rate than that in the first quarter. We have a bit of a question on whether or not tariff headline noise drove a bit of pull forward in demand. I think when we look at those annual figures, that 12-month 28%- growth rate is where we think this will settle. Candidly, this market we think is a very attractive one. It is more structured in its risk. You kind of think about it as a high 80s, low 90s combined ratio and one that we have been in for a long time. IA Financial does the stuff in both Canada and expanded it out in terms of the fragmented U.S., marketplace. Probably looks, thinks there's acquisition opportunities there as well, but they kind of run it more of a bit of a fronting program where they only take 10% of the risks. I mean, do you look at what do you look at in terms of opportunities in terms of warranty business in the United States? Yeah, I think it's always sort of been on our plan that at some stage we would like to find an appropriate entry into the U.S. Again, if you look at our playbook here, right, we've set up the infrastructure in the U.S., through our programs practice. We followed that with surety, now followed it with corporate insurance. The question is at what stage do you follow or adjudicate opportunities in the warranty space? We are doing two things in warranty right now. I think one is looking very hard across the Canadian landscape about how we grow and develop that practice. I think you're right. There have been inorganic opportunities in this space. There are interesting ways you can grow that business. I think for us into the U.S., we'll be relatively pragmatic about how we launch into that business. It would be tough to launch into it organically just because of the scale of that U.S., market. These are generally consumer-touching products. You need a lot of frontline support on these entities. We would look at some stage, if you're talking about the next five, six years, we would hope to find some opportunity to build into that market, likely through partnership or some inorganic means. A question really on loss development analysis here. If we kind of look in at the loss triangles, we saw some deterioration between 2020 and 2022. Maybe just comments on how adequately reserved you think Trisura is. Is there any real difference between what you're seeing in terms of reserve development or claim loss development in Canada versus the U.S.? Yeah, I think this is an important point. Our Canadian practice has a really strong track record, probably 15-plus years of conservative reserving posture, positive reserve development. What you're seeing on an aggregate basis there from some of those earlier years in the early 2020s ties directly to some of my comments earlier about risk appetite in that program business, right? We have seen some development lines in that U.S., business, which is not surprising as you build up a practice, right? You're taking a new business, standing it up, developing your reserving approach and appetite. You saw us make a lot of changes on that book, especially in Q4 last year, taking on what I think is a much more consistent approach across the group to reserving. We feel very good about where our reserves are sitting. We feel we've got a lot of credibility based on the practice of our reserving in Canada and a real opportunity to continue expanding that approach to our businesses across North America. I think that nuance that we're observing kind of on a consolidated basis, I think you've already seen us take a lot of actions around that. I feel very good about where we're setting up for the next few years. I mean, did you bring on a new actuarial team in the U.S.? Did you expand the capabilities there? Was it a third party independently looking at it? Talk about tightening the screws from an actuarial perspective in the U.S. Yeah, in fact, all of those, Tom. We've added new actuarial resources, both at the subsidiary level and at the group level. I'm not sure if you've met our new Chief Risk Officer, but he's now sitting at the group. He's an actuary by background. He's very involved in the U.S., actuarial processes, including reserving. A new team sitting in the U.S., that's looking at reserving specifically on U.S., programs. Then, candidly, more infrastructure around that process, right? The reviews, both internally, we have third-party actuaries as well as auditors that look at all this stuff. The bar is quite high for us from an actuarial perspective. The talent and people and infrastructure that we've delivered over the past few years just sets us up in a better position. It's always an area that's got a lot of focus in the insurance space. I will say our U.S., business is generally a little bit longer tail than our Canadian business. You are seeing that maturation of that approach right now. Oh, that's good. Hey, I mean, if you want to look at kind of P&C insurance markets, we've been in favorable markets now for probably six or seven years. Who knows how long they're going to last, but maybe this comment here, and I'll look for your reaction to that. You're looking to build out now a specialty business in the U.S. I'll just characterize it as we're probably more than halfway through this ballgame here in terms of, well, markets are not hard. They're probably still relatively firm, but I'm not sure how long they're going to last. What would you say to someone who said, "Okay, you're looking to do an expansion in the U.S., but we're in the seventh inning of this ballgame now. Have you missed it? Are you too late here? What are the opportunities? What are the risks as a result of coming in later in the cycle in a U.S., expansion play? I think this is a fair question, Tom, but one that likely probably applies to groups that are less specialized than us. If you think about Trisura as a vehicle, right, our approach and the lines of business we write generally perform better than the markets through the cycle. Our appetite for these lines of business is not fickle, right? We're not going to lean in and write business in one market, lean out and write business in another. We are going to consistently provide support for these lines of business and consistently expect profitable underwriting through that cycle. I acknowledge your point. The market is probably on the downswing of what was a really firm market in corporate insurance. Let's talk about surety as being in a competitive soft market for the past six, seven years, right? have been building that practice in that market. If we roll back the clock to 2005, 2006, when we launched Trisura originally, we built that practice until about 2019 through a soft market, right? That was a consistent soft competitive market in this business. I do want to both acknowledge the nuances of hard and soft market trends, but also differentiate Trisura's specialty focus within that, right? We would have an expectation that our underwriting through the cycle is both profitable and differentiated versus the market. That means that regardless of what we see in this space, we are just going to consistently build those premiums, that focus in the lines of business we know well, in the lines of business we expect to have good underwriting. It is a fair point, but one I would maybe apply more to more consolidated or commoditized underwriters. Good point. A question with respect to investment income, net investment income. I think you said your book yield was 4.25%. Probably the duration's about four years. That would probably imply growth in investment income is not yield growth, but just volume growth. How should we be thinking about growth in investment income going forward? Yeah, I think if you're modeling this, Tom, you're exactly right on the drivers of this. We've got probably accretive deployment in the U.S., from a book yield perspective because those rates are a bit higher than Canada. We've probably got less accretive deployment in Canada. Net net, you're probably pretty close. I think mid-single digits growth in investment income is what we should be looking for. Most of that, as you say, is volume changes, not yield. Yeah, and just touching on, I think you mentioned about excess debt capacity. Should we be thinking that there's opportunities here and perhaps you'd be looking at adding on some debt here and maybe putting that into this treasury-listed vehicle in the U.S.? Any thoughts there? Yeah, I think that's a very logical way for us to fund the platform. Certainly, the most accretive way would be pulling down that capacity. We've got two sort of structures for our debt. We've got a revolver right now that we can draw down in CAD or $U.S., and we've got our term debt. Likely in the short term, to the extent we have any use, it will be on the revolver. Our term facility comes due next year. We've got to start thinking about what we're going to do around that facility. We have a lot of flexibility right now on how we would consider funding vehicles internally. Good. David, it kind of brings us to the end of the questions that I can see here in the questions that I've kind of had scribbled down to start the session. Do you think there's anything that we haven't addressed here that you'd like to share with us? No, I think you've got a fair overview of things, Tom. The one area I do want to continue highlighting is there sometimes is questions around, okay, is Trisura growing as quickly? Is Trisura the same entity as it was previously? I think there's some obfuscation here of some really, really strong performing parts of the platform. If we look at the growth rates in those primary lines this quarter, the last few quarters, I can't understate how exciting that is for the platform and how impactful that is for net premiums earned growth, for profitability in the long term. That in the next few years will really dictate the trajectory of Trisura. I think there's a lot of exciting stuff happening across the platform that will pay big dividends in the future. Yeah, I mean, one came in here. If you look at your, if you look at your ROE, your price to book would be significantly lower than the implied price to book given your 18% ROE. The question is, how do you fend off potential M&A when you're trading at a multiple that is significantly below the implied price to book given your ROE profile? How would we defend against it? Yeah. Yeah. How would you fend off? I mean, I mean, you have got diversified businesses here, but I did not ask it, but it is a good question. Maybe you can give us your thoughts or how would you fend off any potential M&A? Yeah, I think Tom, as a public company, you deal with these nuances often, right? There's always a mark on your company and its valuation. I think we're pragmatic about that. We do have some protections enshrined in our approach from a corporate perspective. As a Canadian regulated FI, you do have some controls on the speed and pace and types of entities that can consider purchasing. There are tools that help you manage those processes, but this is not a new challenge for Trisura, right? We have always had very, very attractive businesses from the moment we spun out from Brookfield in 2017, and I've been able to navigate that. It's interesting today. Our multiple is obviously a little bit more attractive than it's been historically, and the business is performing as well or better than ever. That's a nuance we are conscious of, but not one that stresses us out. Okay. David, on behalf of BMO Capital Markets, I'd like to thank you for joining us this morning in this fireside chat and wishing everybody a great spring. Weather's looking nice, and hopefully the Leafs can pull off continued success here as they work their way towards a cup that hasn't been around here forever. I'll leave it at that. Okay. Thanks very much, everyone. Thanks, Tom.