Good day. Welcome to the Everest Re Group first quarter 2023 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on a touch-tone phone. To withdraw your question, please press star then two. Please note today's event is being recorded. I would now like to turn the conference over to Matt Rohrmann, Senior Vice President and Head of Investor Relations. Please go ahead. Good morning everyone, and welcome to the Everest Re Group, Ltd. first quarter of 2023 earnings conference call. The Everest executives leading today's call are Juan Andrade, President and CEO, and Mark Kociancic, Executive Vice President and CFO. We are also joined by other members of the Everest management team. Before we begin, I'll preface the comments on today's call by noting that Everest's SEC filings, including extensive disclosures with respect to forward-looking statements, management comments regarding estimates, projections, and similar, are subject to the risks, uncertainties and assumptions as noted in these filings. Management may also refer to certain non-GAAP financial measures. These items are reconciled in our earnings release and financial supplement. With that, I'll turn the call over to Juan. Thank you Matt. Good morning everyone. Thank you for joining us. Everest started off strong in 2023, with significant growth, increased underwriting profits, an operating ROE over 17% and total shareholder return in excess of 14%. We continue to diversify and expand our plan with both of our underwriting businesses delivering profitable, broad-based growth. In reinsurance, our leadership position was abundantly clear in the ongoing hard market flight to quality. Our team's consistent execution resulted in record gross written premiums and expanded margins. We continued to invest in scaling our primary business while remaining disciplined. We capitalized on the diversification of our portfolio and strong pricing environment. This led to stronger underwriting profits over last year. Everest is uniquely positioned to succeed in this market. We are bringing the full power of the Everest global franchise, together with underwriting discipline and the best talent in the business to drive sustainable returns. With that I'll turn to our first quarter financial highlights, beginning at the group level. Group underwriting profit, net investment income, operating income, and net income all increased meaningfully in the quarter. Growth was excellent, and we continue to see great opportunities for continued expansion. We grew gross written premiums by almost 20% in constant dollars year-over-year, led by the reinsurance division, which achieved record quarterly premiums. Continued rate increases, exposure growth, and strong underwriting discipline create margin expansion and keep us ahead of loss trend. We delivered $443 million in net operating income, up over 9% from prior year. The group combined ratio was 91.2%, a 40 basis point improvement from last year. It includes 3.7 points of catastrophe losses from the Turkey earthquake and the New Zealand floods and typhoon. We have no meaningful loss activity from the spring storms in the U.S., as our de-risking efforts continue to manifest themselves in both our reinsurance and insurance results. We improved our attritional loss ratio 30 basis points year-over-year, reflecting pricing momentum and improving terms. Underwriting profits were $273 million, which are among the company's highest quarterly results over the past five years. Turning to investments. Our high-quality portfolio produced net investment income of $260 million, a 7% improvement from prior year, driven by higher new money yields. Turning to our reinsurance business. Reinsurance delivered an outstanding first quarter performance with significant top and bottom-line growth. We capitalized on our well-positioned and scalable reinsurance franchise, our leadership position, the hard property cat market, and our deep client and broker relationships, resulting in excellent outcomes for the portfolio at the January 1 and April 1 renewals. The precise and disciplined execution by our reinsurance team positioned Everest to succeed in this dynamic market. We targeted attractive opportunities to grow with trusted partners at materially improved risk-adjusted returns. Our practice of setting clear and consistent expectations early with clients and brokers led to significant improvements in pricing and terms and conditions across our portfolio while building long-term relationship equity. Cat excess of loss pricing is excellent, with risk-adjusted rate changes at January 1 of +50% in North America and over 40% international. Casualty lines, average rate increases continued to exceed trend. Importantly, our team was distinguished as the preferred reinsurance market by being proactive and constructive with our customers. The value we created with our partners gives us a competitive advantage, helps us deepen our relationships, and creates new opportunities. Our momentum continued at the April renewal, where pricing remained strong, up 44% in North America and 26% in international. This builds on prior rate increases in 2022, with expected returns consistent with the levels we saw at January 1. We grew strategically, most notably in specialty lines such as marine and aviation, with strong risk-adjusted returns. We expect to benefit from improvements in ceding commissions for the remainder of the year. We expect the strong market conditions to continue through 2023 and into 2024, and we remain on offense in this robust market. Reinsurance top line results were excellent, up 23% on a constant dollar basis, with $2.6 billion in gross written premiums. As I mentioned earlier, this is a quarterly record. Growth was broad-based by line and geography, up double digits across every business unit. Property cap premiums were up 28% from last year, along with casualty and property pro-rata premiums at 22% and 19% respectively. We delivered a 17% increase in underwriting profit to $207 million on a 90.8 combined ratio, a 60 basis point improvement from 2022. This included pre-tax catastrophe losses of $108 million, net of estimated recoveries and restatement premiums from the Turkey earthquakes and New Zealand floods and typhoon. Our deliberate efforts to optimize our portfolio and reduce cat volatility continued to improve our portfolio economics. Both the attritional loss ratio at 58% and the attritional combined ratio at 85.9 improved down 90 basis points and 30 basis points respectively. Remember, many of the rate and margin improvements made at January 1 and April 1 will take several quarters to earn into our financial results. This should be a meaningful benefit for earned premium throughout the year. We head into the upcoming renewals, our value proposition and relationships in the market have never been stronger. We will continue to bolster our global leadership position and maximize our portfolio's performance. Turning to insurance, where we delivered another solid performance in the first quarter. We achieved a 92.4 combined ratio in line with our previous assumption, resulting in an underwriting profit of $66 million, up 12% year-over-year. We continued to grow and develop our world-class talent, capabilities, and value proposition to enhance our portfolio and increase Everest share of the global insurance market. We grew the insurance segment by nearly 12% in constant dollars and generated over $1 billion in premiums for the eighth consecutive quarter. Growth was broad geographic, driven by a diversified mix across property and specialty lines, particularly strong in marine, energy, and construction. We remain cautious in certain lines, including monoline workers' compensation and public company D&O. We also benefited from pricing improvements in the first quarter. We achieved an 8% rate increase, excluding workers' compensation across the portfolio, led by property and excess liability, with continued strong rate across other lines. This is the second sequential quarter with an increase in the overall level of rate changes achieved. We expect the hard market in reinsurance to put upward pressure on primary insurance pricing. This dynamic should extend the favorable pricing environment in insurance for the foreseeable future and will also benefit our pro-rata business in the reinsurance segment. Despite severe weather in the U.S. in the quarter, our cat losses were immaterial at $2 million. The overall cat result reflects our disciplined portfolio management actions to reduce volatility over the last several years across the company. The attritional loss ratio was 64.2, up modestly year-over-year, primarily due to a current accident year adjustment to a single medical stop loss program, which we non-renewed. Mark will provide more detail on this in a few minutes. Throughout the first quarter, we continued to prudently manage the business, balancing investments in our people and infrastructure as we build a company for the future. We are streamlining and scaling our operations to serve the market with greater efficiency, connectivity, and agility as we grow. We are well-positioned to seize attractive opportunities in this environment. We are expanding our breadth of innovative products and advancing our leadership across the global P&C market, anchored by our underwriting discipline. Our sights are set firmly on shareholders, clients, and colleagues as we take full advantage of the robust opportunities in this market. With that, I'll turn it over to Mark to review the financials in more detail. Thank you, Juan, and good morning, everyone. As Juan mentioned, Everest had a strong start to the year. The company reported operating income of $443 million, or $11.31 per diluted share in the quarter. The operating ROE was 17.2% for the quarter, while total shareholder return, or TSR, stands at 14.1% year-to-date. We improved our overall attritional loss ratio while generating double-digit growth in constant dollars in both segments as pricing and terms remain attractive in a number of lines of business around the globe. The company's strong performance in the first quarter was led by our team's high level of execution in our core markets, and we have a number of tailwinds at our back throughout the remainder of the year. Looking at the group results for the first quarter of 2023, Everest reported gross written premium of $3.7 billion, representing 17.5% growth year-over-year, or 19.5% growth in constant dollars. The combined ratio was 91.2%, which includes 3.7 points of losses from natural catastrophes. Group attritional loss ratio was 59.7%, a 30 basis point improvement over the prior year's quarter, led by the reinsurance segment, which I'll discuss in more detail in just a moment. The group's commission ratio improved 40 basis points to 21.3% on mix changes, while the group expense ratio was 6.4%, up modestly year-over-year as we continue to invest in our talent within both franchises. Moving to the segment results and starting with reinsurance. The reinsurance gross premiums written grew 23.2% in constant dollars during the quarter. The strong growth came from the successful execution of our 1-1 renewal strategy. A significant amount of the premium growth came from property and casualty pro-rata treaties, which will earn in more gradually in excess of loss treaties over the coming quarters. As Juan said, this will be beneficial to earn premium for the rest of the year. We generated double-digit growth in all three of our operating divisions, North America, International, and Global Fac. The combined ratio was 90.8%, which includes five points related to the Turkish earthquake and New Zealand floods, as Juan noted earlier. Despite these events, our loss experience came in lower than our planned cat load. The attritional loss ratio improved 90 basis points to 58% as we continue to achieve more favorable rate in terms, as well as shifting the book towards accounts with better risk-adjusted margin potential. The commission ratio was 25%, broadly in line with last year. The underwriting-related expense ratio was 2.8%, modestly higher year-over-year, largely driven by the timing of certain expenses. We remain focused on operational efficiency across the entire company. Moving to insurance, gross premiums written grew 11.5% in constant dollars to $1.1 billion, which is impacted by the seasonality and tends to be our lowest quarterly production. Growth was primarily driven by property and specialty lines in the quarter as pricing gained additional momentum from the fourth quarter and remains well ahead of loss trend. The combined ratio was 92.4%, up 50 basis points year-over-year. The attritional loss ratio was higher this quarter at 64.2% as we took a one-time increase in the current accident year on our medical stop loss business of $15 million. A portion of our medical stop loss portfolio saw an increase in large loss activity. We isolated the poor claim performance to a single block of business, took decisive action and non-renewed it. The rest of the medical stop loss book is performing within expectations. When assessing any book of business, we want to make sure we are as proactive as possible at triangulating and mitigating any losses as soon as possible. Commission ratio improved 70 basis points, largely driven by business mix. The underwriting-related expense ratio was 15.9%, which is within our expectations as we continue to expand our global footprint and continue to proactively invest in a number of growth initiatives across the business. We expect to achieve a mid-15% insurance expense ratio by year-end 2023. We also reaffirm the 91% and 93% combined ratio assumption for insurance. Finally, to cover investments, tax, and the balance sheet. Net investment income for the quarter was $260 million, with interest income coming in at $264 million, alternative assets at $7 million, before expenses of $12 million. We continue to see the benefit of higher new money yields in the fixed income portfolio, while alternative returns should pick up in coming quarters, assuming the broader market remains positive. Overall, our book yield improved from 2.5% to 3.8% year-over-year. Our reinvestment rate remains well north of 5%. We continue to have a short asset duration of approximately 3 years. As a reminder, approximately 20% of our fixed income investments are in floating rate securities. For the first quarter of 2023, our operating income tax rate was 9.2%, benefiting from the geographic distribution of our income streams and thus favorable to our working assumption of 11%-12% for the year. Shareholders' equity ended the quarter at $9 billion, or $10.5 billion, excluding unrealized appreciation and depreciation of securities. At the end of the quarter, unrealized losses in the fixed income portfolio equate to approximately $1.5 billion, $250 million lower as compared to year-end 2022. Cash flow from operations were strong at just under $1.1 billion during the quarter. Book value per share ended the quarter at $229.49, a sequential improvement of 7.2%, adjusted for dividends of $1.65 per share. Book value per share, excluding unrealized appreciation and depreciation of securities, stood at $266.64, versus $259.18 per share at the end of 2022, representing an annualized increase of approximately 3%. Debt leverage at quarter end stood at 22.2%, modestly lower on a sequential basis. In conclusion, Everest ended the first quarter of 2023 in a strong position with good momentum heading into the upcoming quarters. We continue to seek good opportunities to invest in the platform and scalability of our company. That summarizes our first quarter results. With that, I'll turn the call back over to Matt. Thanks, Mark. Operator, we are now ready to open the line for questions. We do ask that you please limit your questions to 1 question plus 1 follow-up, and rejoin the queue if you have additional questions. Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your touch-tone phone. If you are using a speakerphone, we ask that you please pick up your handset before pressing the keys. To withdraw your question, please press star then two. At this time, we'll pause momentarily to assemble our roster. Today's first question comes from Elyse Greenspan with Wells Fargo. Please go ahead. Hi. Thanks. good morning. My first question, starting with reinsurance. you know, appreciate the comments on the call pointing to it, you know, taking time for some of these rate increases to earn in. Just hoping to get a little bit more color on just the cadence of this and how you expect, like, these strong rates you talked about at 1/1 as well as at 4/1 to earn into, you know, your margin, right? How should that, you know, 58% underlying loss ratio that you saw within reinsurance, you know, trend over the balance of the year? Oh, that's great, Elyse. This is Juan Andrade. Good to hear from you. Let me kick it off in, first of all, by saying, you know, our operating performance for the quarter was excellent. As I just talked about in my opening remarks. We had significant top line growth. We had underwriting profit, operating income, and net income all up meaningfully for the quarter, generating a 17% operating ROE and a 14% TSR. I mention all of this because we're just getting started. Directly to your question, you know, it's important to understand that the current environment, particularly in reinsurance, is providing us with meaningful margin expansion. We expect to grow rapidly in 2023 as our reinsurance franchise is very scalable, and our combined ratio should continue to improve on the strength of the rate and improved terms and conditions and mix of business. Directly to your question, I think it's also important to understand that the earned premium that we saw come through in the first quarter of the year was really mostly from the fourth quarter of 2022, which basically means that as this earns in into the second quarter, third quarter and fourth quarter, it's gonna be earning in at those much higher rate levels that we experienced at January 1 and that we are now experiencing at the April 1 renewals at the same time. Again, I think the timing of this is gonna be over the next few quarters for the rest of the year, but I expect this to be very accretive and to have a positive impact on the portfolio. Let me ask Jim Williamson to maybe add a little bit of color just to give you some perspective, particularly on the 4 ones. Yeah, thanks for the question, Elise. I think, to add some color to what Juan laid out, just wanna give you a little more perspective on what we're actually seeing under the covers, particularly starting with the Jan 1 renewal and then continuing. A little bit of a view, if you don't mind, on where we see this market going. You know, as Juan indicated, we had excellent operating performance in Q1, the Jan renewal and really in the lead-up to the January renewal, which really translated into us having a broad set of opportunities. When I say broad, I really mean just about every class of business, starting clearly with prop cat, but also including casualty, specialty lines, financial lines, really in every market around the world. You know, our growth was very broad-based that way, including our North America treaty business, our international treaty business, as well as facultative. When you think about us attacking that, clearly January 1 renewal, we talked about a +50% in North America, +40% international on property cat. That continued into the April renewal, where we were over 40% in North America, mid to upper 20s internationally, which included markets that started taking rate in 2022. That was exceptional. At the same time, and very important, and Mark had touched on this in his opening remarks, we also saw terrific opportunities in both casualty and property pro-rata. We took those opportunities, and I think our ability to constructively engage our clients and cedents gave us preferred positioning around those opportunities. What are we seeing? Well, on the casualty side, rate continues to stay ahead of trend. That's what our clients are experiencing. Ceding commissions are also starting to come down. Those were terrific opportunities. We leaned into that. On the property side, you know, our view is we're at the very beginning stages of a major correction in the in the primary property market, and we'll get an opportunity to participate with our clients alongside them on a pro rata basis, and again, at very attractive ceding commissions. That was a meaningful part of our Q1 growth was in pro rata. As we go forward, you know, the 4/1 renewal was outstanding. 5/1 renewal, you know, a little bit smaller, but also excellent results. We're seeing a very consistent theme where property renewals, as we go through the renewal periods, are achieving or exceeding the expected return levels we saw at January 1. Then I'll end at June 1 because it is relatively imminent. Our view is, it'll be very consistent with that. We think the market will continue to dislocate. We will have incredible opportunities to grow with our best-in-class clients, and really allocate our capacity to superior returns. Again, I would expect that to be at or above what we saw at January 1. All a tremendous amount of really high-quality opportunity that we're capturing. To Juan's point, it is going to take time for that to earn into our portfolio. You started to see it a little bit in the 1st quarter. Obviously, the effect of January 1 begins to earn in. An important point I would make on that earning is we are also at the same time that we're attacking this incredible opportunity, we're also being very prudent on our loss picks. Remember that cat XOL does not get booked in, at least at Everest, with a 0% attritional loss ratio. We are booking a very prudent attritional loss ratio. Our, you know, our hope obviously is that we don't need those dollars, but we want them to be there in the event that there are attritional cat losses that don't meet our cat threshold. You know, over the next, you know, quarter, two quarters, three quarters, you will start to see that become a bigger and bigger part of our portfolio, and that will exert downward pressure on our loss ratio and our combined ratio. Okay, that's helpful. My second question is on the insurance margin, right? You guys had called out the medical stop loss, the impact in the quarter. If we adjust for that, should we assume that the starting point for the second quarter and the rest of the year should be a 90% or better current accident year ex cat combined ratio in insurance, given that that medical stop loss issue isn't expected to repeat? Elyse, it's Mark. Good morning. Look, we had the one bump in the medical stop loss this quarter. It's roughly $15 million dollar charge. We are confirming, and I mentioned it in my script, in the prepared remarks, 91% and 93% combined. We feel very good about the, you know, margin that we're adding, the growth that we're adding, both domestically and globally. I think the attritional loss ratio is showing, you know, good improvement, definitely sustainable with the margins that we have. We feel confident about remaining in that 91%-93%. Thank you. Thanks, Elise. Thank you. Our next question today comes from Yaron Kinar with Jefferies. Please go ahead. Good morning, everybody. My first question goes to the loss picks. I'm just curious if you saw any increases in liability or financial lines loss picks, both in insurance and reinsurance? Yeah. Yaron, this is Jim Williamson. Thanks for the question. I'll start with reinsurance. When I look at our loss picks for the first quarter, you know, I'd really indicate a few things. One, within casualty, obviously we're always evaluating in a very granular way our picks, even at the sub-line level. There were a number of puts and takes within casualty. The overall casualty loss pick, as it earned into the first quarter, is very consistent with where we were last year. Our view is, you know, we're continuing to see rate, you know, in excess of trend. That's a good guide. At the same time, it's a pretty high-risk environment, we're being prudent about that. On the financial line side, that's for us in reinsurance, that really means our mortgage portfolio. Again, we saw incredible opportunities in 2022 in particular with the 2 GSEs, which is very high margin business. Again, we're very prudent in the loss selections there, and our loss picks in 2023 are exactly the same as our loss picks in 2022, even though we've been moving further away from loss. Lastly, on property, on the XOL side, we do see improving loss picks over last year. Again, we're still being, you know, I think, relatively prudent, and we don't book cat XOL at a 0. We're just a little under 20 for an attritional loss pick there, which is an improvement over last year. Sure. Yeah. Thanks, Yaron. Appreciate the question. Thanks. Actually, I do have a second one, if I could. Just on premium growth, if I may. One, the XOL premium growth was clearly a bit lower than the pricing you saw on property cat, and just want to confirm if that's a function of moving to higher layers, or is it a function of shrinking limits? What's behind that? Yeah, Yaron, it's Jim again. Look, I guess the way I would describe that is really in a couple of ways. One, the first thing we do when we're confronting the breadth of opportunity that I described in the earlier question is we look to create our own capacity. A lot of that is moving away from any area of the portfolio we're not seeing the expected returns we want. An example of that, which was really a factor in 2022, is we were trimming some of our pro-rata portfolios, which do have, you know, a heavy amount of premium with them. Then obviously the second factor, as you described, is we are moving further away from loss. You do tend to see lower premiums per dollar of exposure, all other things being equal. What I would also say is all other things are clearly not equal. The rate on line that we're seeing in our portfolio overall from a cat XOL perspective are up year-over-year and quarter-over-quarter, even though we're moving further and further away from loss. That's what's driving what we expect to be very strong premium growth both in the first quarter and through the rest of the year. What I would also say, and I think this is crucial, is our modeled expected profit is growing much faster than our written premium. That's because you're seeing the scissoring of margin expansion happening in those cat XOL treaties. I think that's a really terrific result. Our expectation is. It's certainly been proven out January 1, April 1, May 1, we believe June 1. Really through 1/1/2024, we expect that scissoring effect to continue. Thanks so much. Thank you. Our next question today comes from Mike Zaremski with BMO. Please go ahead. Hey, great. ceding commissions improving, I believe on the reinsurance side were mentioned a couple of times in your prepared remarks. Can you provide any updated color and let us know if that's, one, impacting the financial statements if you expect that to continue into the mid-year renewals? Yeah. Yeah, Mike, this is Jim Williamson. Thanks for the question. We have seen improved ceding commissions, primarily driven on the casualty side, but also on the property pro rata side. Now remember, when we talk about improved ceding commissions, and we mentioned it in our fourth quarter call when we were talking about the January 1 renewal, we're giving you indications on a written basis. What we had said last quarter, and I would repeat it, is that we've seen about a point improvement in casualty ceding commissions and a little less than that on property, mainly because property ceding commissions were already relatively lean. We found them to be pretty attractive. So that's on a written basis. That's gonna take time, you know, similar to the other comments that we've made, particularly when you're talking about pro-rata premium that really earns over two years. It takes time for that to be reflected in the financials. You really haven't started to see that yet, but we expect it to emerge over the coming quarters. Okay. That's helpful. Also another follow-up on the in the prepared remarks, you know, the optimism about the property side, about the beginning stages of a major correction. Maybe you can kind of elaborate there, you know, why we're in the beginning stages. Is it simply because some of the primaries are seeing their reinsurance rates go up a lot and, you know, there's clearly a lot of replacement cost inflation, so the primaries are getting ahead of trying to get ahead of an issue? Or, what are you seeing there and why do you see that growth being so attractive if some of the, your primary partners see themselves as kind of being a bit behind the inflation curve? Yeah. Mike, this is Juan Andrade. Let me start, and then I'll ask Mike Karmilowicz to add something to this answer as well. Look, I think it all starts with the fact that we do have a structural supply and demand imbalance that's taking place in both insurance and reinsurance, frankly, on property cat, right? You know, on the supply side of things, you have essentially less capacity being deployed by rated companies. You also have less of the ILS capital coming into the market. On the demand side, well, we have all the issues that we've all lived through together, right? You have inflation, which is putting upward pressure on values. There's volatility in the environment from social inflation and other things. Our ceding partners basically are requiring to buy more insurance, more reinsurance along those lines. That structural supply and demand imbalance, I think is really what begins part of the equation. Jim has talked about what we have seen on the property side in reinsurance, which is very attractive, or from a pricing perspective, and we expect to see that through, you know, 1/1/2024, maybe beyond. On the primary side, we're seeing basically the same things. We're now basically seeing property rates up in the high teens, into the 20s. If you're in wholesale, it's +30%, right? You're definitely seeing that. Keeping in mind that we have both a wholesale and a retail channel, we are getting that rate on both sides of the equation. From our perspective, that also makes a lot of sense for us. Also, keep in mind that we have also been de-risking the insurance side of our business, not just the reinsurance side. It's one of the reasons why you don't see us picking up losses from the spring events in the U.S. Basically, we had $2 million of cat loss in the insurance segment. You know, we are seeing pretty significant rate increases on the primary side. We have continued to de-risk, and our strategy in property has moved more towards middle market retail than anything else. All of these things, I think is what makes it fairly attractive for us. Mike, maybe you can add a few points. Sure. No, I think that's well said, Juan. I guess I would just add a couple other comments, Mike, to that. One, we continue to push out the retail side. At the same time, given the market conditions, we've been able to continue to you know, de-emphasize the concentrational risk, particularly in the peak zones, the cat-prone zones, particularly in the wholesale market. In addition to that, we've actually are now basically helping out with our foundational work we do with our international expansion. We're now spreading that out and diversifying our portfolio across the globe, giving us a lot better balance and overall more risk-adjusted returns that are more consistent and sustainable over the long haul. Great color. Thank you. Thanks, Mike. Our next question today comes from Brian Meredith with UBS. Please go ahead. Hi. Yeah. First question, just looking at Florida renewals, with the legislation that went through, on what are your expectations of what that means for potential capital moving in, and how do you think Everest will position itself for that, six one renewal, meaning quota share versus excess or loss? Sure, Brian, it's Jim Williamson. Thanks for the for the question. Yeah, look, I mean, first of all, you know, let me just say that our view on the on the reform that has occurred is, you know, it's incredibly constructive. I think the fact that the government in Florida was able to get such a broad-based reform passed is just excellent work. We think over time, that'll be incredibly healthy for the Florida insurance market and will provide much needed relief for for homeowners there. At the same time, we think it's going to take time for the effects of that reform to prove itself. We don't expect the plaintiff bar to sit idly by while the reforms are implemented, and I think it remains a little bit to be seen on exactly what that will mean. We're being, you know, we're being very cautious on that. We have been a very consistent provider of capacity to the Florida market, and our expectations is that will continue. Our view on pricing terms and conditions in Florida for 6/1, we expect really modeled returns to exceed what we saw at Jan one. We think 6/1 will be better than Jan one. The headline rate increases may not be as large because we already took significant rate in 2022, but the economics of those programs should be outstanding. Our view is as long as that is, you know, proven to be true, we'll continue to deploy a similar level of capacity to that market that we did in prior year. In terms of our participation, we're almost exclusively an XOL market in Florida. We do have a couple of targeted quota share deals, but they're a relatively small part of the portfolio, and I don't really expect that mix to change. Great. Thanks. My second was this question. I'm just curious, of the cat loss, how big was Turkey? On that, I'm just curious, you know, given that those are types of programs that have fairly low rate on lines and I'm not sure what the return dynamics are there, why would you be writing that type of business now, given just the strength of pricing and the attractive returns in areas like the U.S. and Europe and other areas of the world? Yeah, sure, Brian. It's Jim again. Yeah, so on the Turkey quake, a couple of things. One, our loss was $70 million for the Turkey quake. What I would describe to you in terms of that market is we've been a long-term participant in the Turkey cat market. We have earned outstanding returns in that market. Similar to the things that we've done in other parts of our portfolio, though, coming in over the last two years, we have really significantly reduced our participation in Turkey, primarily in our quota share treaties, which we've cut back significantly. We are still an XOL player. We've made a lot of money even after this event. Our profit position is very strong, and the return profile is, you know, is very good. The other thing that I would indicate, on that $70 million loss is, you know, if you were to compare what happened in Turkey versus what happened, say, in the U.S. in the first quarter, I think it's an important contrast to point out. You know, that Turkey quake was probably something like a 1 in 50 event. You had 50,000 people, killed in Turkey alone, another 10,000 in Syria. It's a huge human tragedy. Our view is that is a real cat loss, and that's where, Everest Group, Ltd. and its value proposition is meant to be called, to help, that country recover. I would contrast that with the U.S. storms in the first quarter, which really, in our view, should be an attritional event for the primary market. You saw that play out in our portfolio. That gives you a sense of how we're playing those dynamics and really focusing on, you know, leveraging our capacity, we're getting high return and also where, you have actual cat losses. Makes sense. Thank you. Thank you. Our next question today comes from Meyer Shields with KBW. Please go ahead. Thanks. I know you touched upon this a little bit with reinsurance, but I was wondering if you could talk about how, I guess some of the conditions or expected returns are evolving in the international insurance market? Say that again, Meyer, please. I'm trying to get a sense of, I think there's a great sense of what's going on in property, but for other lines in insurance, I'm not sure I have a great handle on the opportunity that you're seeing there in terms of how expected returns are evolving. Yeah, absolutely. I'm happy to start, and then I'll ask Mike Karmilowicz to jump in. Look, I think there's a few dynamics to keep in mind in international markets. By definition, they tend to be more short-tailed in nature. That means that they're gonna carry lower ELRs than what we have in North America because of our long tail focus in North America traditionally. I think that's an important thing to keep in mind. When we look at the broad trends, though, we see pricing actually to be quite good in places like Europe, Latin America, and Asia for that short tail business. For us, that remains pretty attractive. As we were saying earlier, and I said in my prepared remarks One of the great things that we're building right now is really a very diversified global insurance company by geography, by product line, and by distribution wholesale retail, which enables us to play and deploy capital where we find the most attractive areas. For example, in the US, in the quarter, when we see public D&O and maybe workers' compensation not as attractive as other lines of business, we can move away from those lines, be cautious, as I said, and deploy that capital into other lines of business, which could be, again, short-tail property in Europe or in Latin America or even within the US, given what I said earlier. That gives us a sense of how we manage the portfolio to get the most economic benefit for the company. Yeah. I think, Meyer, I would just add, you know, a quick comment on the short tail piece. Not only are we seeing the opportunity within property, but also within marine and aviation businesses as well. Given, you know, our nature of some of these lines, which we don't have legacy issue to, particularly for marine and for, specifically aviation, we have tremendous upside. We've hired great talent. We've got good teams that have great peepering capability, to Juan's point. Given what's happening in the reinsurance market, particularly on the short tail lines, you're just now starting to begin to see that rate environment starting to play through, which is giving us ample opportunity to be able to capitalize on the marketplace right now. Okay. That's really helpful. Thank you. One small follow-up, and I may be trying too hard. I think both Juan and Mark reaffirmed the 91%-93% in insurance for this year's combination. I was hoping you could update us on the reinsurance side. Yeah, Meyer, it's Mark. Good morning. Look, on the reinsurance side, we've got a great rate environment right now, and I think Jim articulated a lot of the points that are behind that. You know, we've clearly got loss experience, supply-demand, factors impacting capacity, our Q1 results are really demonstrating some solid growth. Our reinsurance franchise is very scalable, so we're able to take advantage of that. I think the rate is well established. We defined that quite a bit in our press release and in our opening remarks. You're gonna see property, I think, become a larger component of our combined ratio over time. We're still using prudent loss picks no matter what, because you do have the loss experience of the past. It cannot go down to the bottom line that quickly, but it is shorter tail business on the property side. We would expect to realize margin, you know, notwithstanding the loss experience of the current year over time. I think what we've got is fairly meaningful strength underpinning our combined ratio going forward. As you see the net earned earning out with the increase of 2023 premiums, whether it's the pro-rata side or the excess of loss with this strong rate environment, the shift towards more property versus casualty in the combined ratio, I think you'll see improvements in the combined ratio within reinsurance specifically. We definitely see the margin expansion through the renewals, and we know that's gonna filter down through the combined ratio over time. I see this combined ratio question kind of solving itself through actual results in the coming quarters on an improved basis. Yeah. Meyer, I would add just to Mark's. I think that was well said. This is Juan. I would repeat what I said to Elyse earlier in the call, is that our combined ratio should continue to improve on the strength of the rate, improved terms, mix of business, everything that Mark was talking about. You look at the combined ratio that reinsurance had in this quarter, and I think that gives you a starting point. Okay, fantastic. Thank you so much. Thank you. Our next question today is a follow-up from Yaron Kinar with Jefferies. Please go ahead. Thank you. I just wanna ask a follow-up on the earning in of the pro rata premiums and reinsurance over a two-year period. I would've thought it would be one year. Is there a multiyear treaty component there, or is that just how pro rata is earned? I guess it's a bit new to me. Yep. Yaron, it's Mark speaking. It's a standard accounting convention to earn pro-rata on what's called an eighths basis, so over an eight quarter period of time. It's not a multiyear treaty. It's definitely a one year treaty. Your cedents are obviously producing business throughout the year, so they can produce premium, for example, in December, and it takes time to earn that out. The premium recognition or earnings is really standard in the business for pro-rata, and it's earned on an eighths basis. In the first quarter, you know, without getting too technical, you have kind of a slow ramp up because you would essentially start that earnings really at the midpoint of the first quarter the forty-fifth day of a 90-day quarter, and then it ramps up over time throughout this eight quarter period. You've got last year's pro rata, whether it's property or casualty, still earning into the 2023 earned, for example. You got the 2023 writings earning out. That shift will occur through the year, combined with whatever the loss picks are and the weighting for those specific segments. Got it. That's helpful. One other follow-up, if I may. I think you called out some timing, issues with expenses. When do you expect that to normalize? Well, I'll break it into two parts, corporate and underwriting. On the corporate side, look, we have two components, the largest of which is really interest expense. We have a meaningful component of floating rate debt through the FHLB and then a floating rate sub-debt, and that's based on three month SOFR. That increased, I would say, you know, roughly $3 million a quarter on the run rate versus, say, Q1 of last year. I think that stabilizes for 2023. It's difficult to see SOFR moving that much this year. I think what you see in Q1 will hold for the remaining of the year, potentially go down if SOFR goes down. Corporate expenses, I think last year's run rate of, you know, approximately $16 million a quarter is a pretty good run rate for this year. I see pretty good stability, generally speaking, for the corporate side. On the underwriting, two pieces, reinsurance, insurance. I think on the reinsurance side, we feel good about our expense ratio in general. You see a slightly elevated number in Q1 really for platform expenses for the most part. I think somewhere in the 26%-27% expense ratio type area is a good number for reinsurance in 2023. On the insurance side, we see that, you know, elevating a bit into the mid 15% area. We started off the year at a 15.9%, I think that's a combination of two things, talent acquisition, and then a bit on the platform expense, as we're building out and scaling our operations internationally and also domestically. We're adding meaningful talent, especially at a senior level, globally within the insurance franchise. I think that'll pay off over time, but you do pay for it early on in terms of the expense load. I would point out a couple of things. One, we still feel very good about the technical ratio in insurance, the profitability that's coming in from the commission and ELRs on that standpoint. Hence my comments in the prepared remarks of affirming our assumption in 91 and 93 combined for the Insurance Division as a whole. We see a bit of a mix here in terms of elevated underwriting expense, but still good on 91 and 93 based on sound fundamentals of diversified businesses and the good margin that we're seeing in that business. I think you'll also see a pretty good growth rate for the remainder of the year. Typically, we start seasonally with a lower production in Q1 for insurance, and then it tends to ramp up Q2, Q4, in particular. We do feel that there will be some economies of scale occurring as the division grows even more. Thanks for taking my additional questions and for the comprehensive color. Our next question is a follow-up from Elyse Greenspan with Wells Fargo. Please go ahead. Hi. Good morning again. I wanna go back, also to the reinsurance discussion. I appreciate, right, that you guys are saying some of these contracts are going to take a couple of years to earn in. You know, maybe asking it a different way, you guys printed a 58% underlying loss ratio in the first quarter. When this business is fully earned in, and we see the full impact of the rate increases in your financials, what can that 58%, what can that number drop to? Look, Elyse, it's a difficult question to answer. Let me frame it with a few of the components that would be taken into consideration. I mentioned to you the composition of the business itself. We do see property coming in stronger. I think both Juan and Jim really articulated the level of rate increase that we're seeing. I think the growth is self-evident. You're seeing very strong rate. Jim's talking about risk-adjusted returns that are significantly higher. We believe the margins there are superior. Really good. On the flip side, you're still seeing significant casualty growth, especially on the pro-rata. We're using prudent loss picks there because we are in a elevated risk environment. We're getting paid to take that risk. You got a mix of business that is still, you know, meaningfully impacted by casualty. Those are the kind of factors, that mix, and then the rate itself, which we feel good about, that are gonna determine that over time, not to mention whatever the loss experience. The fundamentals are great. This is truly a generational hard market, in particular for reinsurance property. We're just getting started. We love our positioning and the ability of our franchise, how we're globally positioned to take advantage of it and really be selective in adding value to our clients. In this process. I think that combined ratio will solve itself based on the sound fundamentals. Thanks. My one other from me. Your PMLs, you know, given your expectations for what you expect could transpire at mid-year, it sounds like you guys are still pretty positive about the reinsurance pricing environment. Where would you expect your PMLs to trend once we get through the June and July 1 catastrophe reinsurance renewals? Sure. Elise, this is Jim Williamson. Great question. First of all, you know, we do see tremendous opportunity, and we are leaning into that, and we have selectively deployed incremental capacity, always within the defined appetite of the group. We've talked a number of times about our willingness to put both our earnings and capital at risk, and we have plenty of room within that defined appetite to maneuver, and that's certainly what we've been doing. The other thing that I would say that's a repeat of what you've heard from me in the past, we always start with creating our own capacity. In any portfolio there's, you know, good, better, and best deals. I can tell you the good deals are not getting capacity anymore. It's really moving to the best deals. What that's allowed us to do is, you know, selectively expand available capacity. What does that mean? That means gross PMLs go up modestly. Wasn't a huge move as you saw at 1/1 when we printed our PMLs. I expect that trend to kind of play out through the rest of this year. As I indicated earlier, if 6/1 meets our expectations for pricing and terms, I expect total capacity deployed to be consistent with last year, which I think will produce meaningful increases in premium, even more meaningful increases in expected profit. Very modest or no real change in PMLs. As you roll through the rest of the year, I would expect, again, modest increases in gross PMLs, with, you know, with even larger increases in premium and profit. That should give you a view. I don't expect a wild move on the PMLs by any stretch of the imagination. Thank you. Thank you. Ladies and gentlemen, today's final question is a follow-up from Mike Zaremski at BMO. Please go ahead. Oh, great. Just one quick one. Just kinda thinking through the, you know, the bullish outlook, generational hard market, that term was used, dislocation. You know, just curious, would there be a scenario in the cards where Everest would wanna opportunistically raise capital? You know, the debt capital was, you know, levels were increased last year, which looks like a great move. Just curious if there's any, you know, scenarios in which, you know, equity capital need to be raised as well? Mike, it's Mark. Look, we feel very good about our positioning in this market. You know, our ability to execute our plan. We've got the franchise on a global basis. You know, we're a leading reinsurance market, so I think the platform is clearly well demonstrated to meet this opportunity. We've got, you know, a lot of financial flexibility, and I'll just leave it that we're always exploring and evaluating our market opportunities and our capital structure to make it better. Thank you. Thank you. Ladies and gentlemen, this concludes your question and answer session. I'd like to turn the conference back over to Juan Andrade for any closing remarks. Thank you, and thank you all for being with us today. I think as you can see, our operating performance was excellent in the first quarter. We're off to a strong start, and we're on offense. You've heard some of our commentary here regarding the market and regarding the bullishness. The momentum is strong and our ambitions are high. We're building on our first quarter momentum to continue delivering exceptional value for all of our stakeholders. With that, I thank you for your questions, for your time, and for the support of the company, and we'll see you soon at our second quarter results. Thank you. Thank you. This concludes today's conference call. You may now disconnect your lines and have a wonderful day.