Good afternoon, and welcome to the HCI Group's first quarter 2021 earnings call. My name is Tom, and I will be your conference operator this afternoon. At this time, all participants will be in a listen-only mode. Before we begin today's call, I would like to remind everyone that this conference call is being recorded and will be available for replay through June 6, 2021, starting later this evening. The call is also being broadcast live via webcast and available via replay until May 6th, 2022, on the investor information section of hcigroup.com. I would now like to turn the call over to Rachel Swansiger, investor relations for HCI. Rachel, please proceed. Thank you, and good afternoon. Welcome to HCI Group's first quarter 2021 earnings call. With me on today's call is Karin Coleman, our Chief Operating Officer, Mark Harmsworth, our Chief Financial Officer, and Paresh Patel, our Chairman and Chief Executive Officer. Following Karin's opening remarks, Mark will review our financial performance for the first quarter of 2021, and then Paresh will provide an operational outlook, and we will take your questions. To access today's webcast, please visit the investor information section of our corporate website at hcigroup.com. Before we begin, I would like to take the opportunity to remind our listeners that today's presentation and responses to questions may contain forward-looking statements made pursuant to the Private Securities Litigation Reform Act of 1995. Words such as anticipate, estimate, expect, intend, plan, and project, and other similar words and expressions are intended to signify forward-looking statements. Forward-looking statements are not guarantees of future results and conditions, but rather are subject to various risks and uncertainties. Some of these risks and uncertainties are identified in the company's filings with the Securities and Exchange Commission. Should any risks or uncertainties develop into actual events, these developments could have material adverse effects on the company's business, financial conditions, and results of operations. HCI Group disclaims all the obligations to update any forward-looking statements. Now with that, I would like to turn the call over to Karin Coleman, our COO. Karin? Thank you, Rachel, and welcome everyone. It's been a tremendously busy and productive start to 2021 for HCI. As you can see by our financial performance, our disciplined execution continues to produce consistent profitability, growth, and best-in-class margins. The first quarter was marked by several important achievements. First, at the HCI Group level, consolidated in-force premiums surpassed half a billion dollars, and we expect it to continue increasing in the coming quarters. In March, we paid a $0.40 per share dividend, our 42nd consecutive quarterly dividend. Second, Greenleaf Capital, our real estate division, continuing to be a valuable part of our diversification strategy, both in producing positive cash flows and capital appreciation. Third, Homeowners Choice continued to be profitable and grew through strategic acquisitions such as Anchor and UPC. Fourth, TypTap grew as well. It surpassed $130 million of in-force premium, putting it on track to reach its goal of $200 million by the end of the year. As previously disclosed, TypTap raised $100 million from Centerbridge Partners. Its national expansion continues on track, not only with receiving regulatory approvals, but also in writing its first policy outside of Florida. Finally, in response to the immense growth we are seeing, we recently created separate management teams for HCI and TypTap Insurance Group. This separation will allow each management team to focus on specific growth initiatives as we establish infrastructure for a billion-dollar company. Since 2007, HCI has a proven track record of success and growth. With the achievements I just outlined, we look forward to seeing HCI continue on this path throughout 2021 and beyond. I'll now turn it over to Mark to discuss HCI's financial results for the first quarter of 2021. Mark? Thanks, Karin. This was another good quarter for us, with tremendous growth, new capital, and strong earnings. Diluted earnings per share were $0.75, up from $0.07 in the first quarter last year. Growth was a big story in the quarter, as it has been for some time now. Gross premiums written were up 65%, with strong growth coming from both of our insurance companies. In Homeowners Choice, gross premiums written were up 39%, from $58 million to $81 million. In TypTap, gross premiums written were up 142%, from $18 million to just under $45 million. Consolidated gross premiums earned were up 42%. Again, growth came from both Homeowners Choice and TypTap. In Homeowners Choice, earned premium was up 35%, from just under $76 million to over $102 million, driven in part by the strategic acquisition business from Anchor and UPC. In TypTap, earned premium was up 73%, led by the organic growth of its homeowners product. As an indication of the impact of some of this growth, consolidated gross premiums earned this quarter were the highest they have ever been in any quarter in the history of the company. Of course, they are going higher. Looking at the income statement, you'll see that loss expense is up significantly. This is simply connected to the growth in gross premiums earned. As of March 31st, non-cat loss reserves are up about $10 million higher than at the end of December, as we continue to expense more than we are paying out. This continues our conservative reserving methodology. Both of our insurance companies are in strong financial positions. Homeowners Choice surplus of $127 million at the end of March is up about $7 million from the end of last year, and TypTap surplus of $50 million is up $11 million from the end of last year. A couple of things on capital and liquidity. As previously announced, TypTap Insurance Group raised $100 million of growth capital from Centerbridge Partners this quarter. There is a new line on the balance sheet called redeemable non-controlling interest. The $86 million there reflects the amount received, less transaction costs, and also nets out the value attributed to the warrants of about $8.6 million. In terms of holding company liquidity, we have just over $50 million of cash and financial investments in HCI and full access to our $65 million credit facility with Fifth Third. That is well over $110 million of liquidity at the holding company level. There is another $55 million of cash in the holding company for TypTap Insurance Group. As you know, there have been a few changes in share counts, we included some of that data in the press release. For purposes of estimating diluted earnings per share, the diluted share count is about 10.1 million at the end of March. This is up about 350,000 shares from the new shares issued under the renewal rights agreement, as well as the dilutive effect of the warrants. Wrapping up, the company continues to improve in every way. Both insurance companies are growing, earnings are up, and our capital positions are strengthening at the insurance company level and at the holding company levels. With that, I will hand it over to Paresh. Thank you. Thank you, Karin and Mark, for that summary of the results for the first quarter. By the way, Karin Coleman is our new Chief Operating Officer. She has been with the company in various capacities for over 10 years and will be joining our calls going forward. You have seen the results from Karin and Mark. HCI is reaping the benefits of the decisions made in previous years, including our investments in technology and data and our consistent focus on profitable underwriting. TypTap is experiencing rapid growth within Florida, and as Karin mentioned earlier, it has begun operating outside of Florida. Our transaction with UPC also continues on track, and it should be a great accelerator for TypTap's growth outside of Florida. We continue to explore strategic opportunities for both HCI and TypTap. The entire group is performing well. As we are benefiting from the decisions we made previously, we expect to benefit from the decisions we are making today. Our brightest days are yet ahead of us. With that, we are ready to open the call for questions. Operator, please provide the appropriate instructions. Thank you, sir. Ladies and gentlemen, the floor is now open for questions. If you would like to ask a question at this time, please press star one on your telephone keypad to enter the queue. Once again, it'll be star one on your telephone keypad to enter the queue at this time. Please hold a moment while we poll for questions. Your first question is coming from JMP Securities, Matthew Carletti. Matt, your line is live. You may ask your question. Thanks. Good afternoon. Paresh, I was hoping I could start with kind of state of the Florida market. Obviously, you guys are in a strong position. I think a lot of your peers are in less of a position. So just how do you both, whether HCI and/or TypTap kind of see the market unfolding for yourselves over the balance of the year? As part of that, if you have an opinion on the recently passed legislation, and what that might mean for claims and fraudulent activity as we move forward. Okay, Matt. Look, we're going to split the question in two parts. The first part, I'm going to let Karin tell you with some numbers, some of the impacts of the legislation. We're going to answer in the context of if it had been in place when Irma hit the state of Florida. Thanks, Paresh. Okay. We believe that the legislation will be helpful in the reduction of the first notice of loss that occurred when we went back and we looked at the Hurricane Irma numbers that we had. The year one claims that were filed, 9% of those went into lawsuits. People that filed timely claim in Hurricane Irma, 9% ended up in lawsuits. In year two, the claims that were filed, 34% of them have ended up in lawsuits so far. In year three, those sort of late reported claims, more than 50% of them are already in lawsuits. The reduction of the time to file should help quite a bit. Yeah. Matt, you kind of get the idea, just that the legislation moving it from three years to two years has a slight impact on claims but has a huge impact on litigation, yeah? Yeah, that real-life example is very helpful. Yeah. Thankfully, also the sliding fee schedule should help reduce litigation over minor disputes. Yeah? All of those things are positive. It was a good legislation because the folks who did have filed claims in year one and year two, they're not impacted. Yeah? It was a good balanced legislation and worked out fine. As far as speaking about the Florida market, I think the Florida market continues to be, in a general sense, challenging, and I think that's been discussed by a number of our peers. The item that really is differentiating both HCI and TypTap from most of our peer group is basically back to those decisions we made years ago to invest in technology and data. Yeah? That is what is allowing us to operate in exactly the same terrible environment that all our peer group operates in, but with the materially different results. Yeah. We sort of alluded to this a couple of years back, and you're seeing it really play out at this point, yeah. Yep. Great. Then maybe if I could focus on TypTap for a moment, could you just kind of provide us an update of, obviously you guys have been expanding. We've seen the press releases of the license in a number of additional states. Just where that stands, compared to kind of the original path you set out several months ago. Ahead of schedule. I caught in your comments the $130 million of in-force premium, it does feel like we're well on our way towards you had a $200 million target for the year. Yeah, absolutely. Look, I got to hand it to the TypTap management team as well here, right? Because if you recall over the years, we were at $25 million, and we said we'll get to $50 million by doubling. They did that. We said it's $50 million, we're going to double it to $100 million. That was last year. They did that. This year, we've said we're going to double from 100 to 200, and just by the Q1 numbers, they're well on track for that. The team is executing really well, right? In terms of TypTap's prospects on a more macro level, I would break it into three areas. Florida obviously is doing very well. It's right on track with what we had said and expected. The expansion into the other states and getting licenses and the rates and forms approved, it's a little bit slower than we had anticipated, but some of that is understandable because we do have to get together with regulators in every state. In a COVID environment, it sometimes delays things. We're maybe running a little bit behind on that, but not much. If you're thinking in the space of years, this is not a material difference. The third part, which is really exciting, is because of the UPC transaction, the four Northeast states that we've acquired from UPC, they will really accelerate growth for TypTap in those areas. On balance, one is Florida's doing really well. Northeast is going to be way better than we had originally thought. The other states are running a little bit slower than we had anticipated. On balance, pretty good outcome. Great. Last question, if I can. Obviously, the annual reinsurance renewal's coming up here at the end of the month. Any thoughts you could provide as either from just a market perspective, we obviously know the market itself has had its challenges, but you guys have stood out as putting up much better results, what that might mean for HCI. If there's anything you could share specific to HCI in terms of changes you might expect to make to the program, if it's significantly more or less limit or changes to retention and so forth. Yeah. A couple of things. In terms of the market in general, right? It's the annual ritual. We've got renewals coming up for June 1, so does the rest of the Florida industry. The negotiations are well underway. Putting it into a little bit of perspective, June 1 this year from our perspective looks a lot smoother than June 1 last year did, with COVID being there, et cetera. Things will get sorted out, things will be fine. The other things that we should point out, this is particular to HCI Group and TypTap and us, is that instead of as TypTap has matured and as Karin talked about separate management teams, et cetera, we're also beginning to now buy reinsurance in a whole different way. Instead of buying one wind tower, there's an HCI wind tower, a Homeowners Choice wind tower, I should say. There's a TypTap wind tower, this is Florida. Then there's a third wind tower for non-Florida. Then the fourth tower, which is a flood tower. We've sort of had to, as we've segmented the business and grown up, had to now start looking at these things as separate entities, which is a different thing to what I think the direction most companies have headed in. Yeah? Mm-hmm. Given the differences in kind of seasonality of cat seasons and things like that as you expand nationwide, is it a reasonable assumption that we might expect different retention levels, so forth, on a TypTap tower versus a HCI floor or an ex-Florida tower versus a Florida tower, nuances like that? Yes. Matt, the biggest takeaway from this is how we're looking at not only TypTap and Homeowners Choice, but also Florida, the Northeast, other parts of the country, we basically look at each geographic area, let's say, and we think of it as a separate business, and we make sure that our rates are adequate, and we have appropriate reinsurance for that geographical area. Each geographic area has to sort of make sense on its own, not suddenly say, "Oh, we benefit because we're buying a big Florida tower, we can just put the risk in there," or any of those kinds of things. We're actually looking at these things as separate businesses that we are hopefully running profitably. Eventually, if we would end up with, say, 10 separate businesses that are all profitable, properly run, they sort of have the added benefit of addressing each other, should there be a problem with one of them. Yeah? Mm-hmm. That makes sense. Great. Thank you very much for the color. Best of luck congrats on a nice start to the year. Thank you. The next question is coming from Truist Securities, Mark Hughes. Mark, your line is live and you may ask your question. Thank you. Good afternoon. Mark, could you talk about the loss ratio? In prior quarters, you've alluded to some of the impact from Anchor and UPC and how that loss ratio impact might trend over time as you refine that book, raise prices where needed, et cetera. Could you talk a little bit about that, how much impact this quarter and where it's going? It was a pretty straightforward quarter, really. It was, like I said in my prepared remarks, the increase in loss expense was just really completely attributable to the increase in the gross premiums earned. The consolidated loss ratio was, I think, about 35%. We have different pieces of the business that we reserve in different ways. Homeowners Choice is that sort of 24%-25% ratio, and the Anchor book is a little bit higher. We're renewing it onto our paper, so the pricing is in line. The loss ratio is just a little bit higher there because that tends to be strictly homeowners. The loss ratio is a little bit higher on TypTap. Then the loss ratios, I think we probably talked about last time around for UPC is more like in the 50% range. This is just sort of a straightforward quarter of the premiums times the loss ratio. Of course, we track everything else to make sure that everything is on track to support those loss ratios and, paid, incurred, those types of things came in pretty much in line with what we expected. A similar question on the policy acquisition expense. Were there any unusual items in there, or is this a reasonable run rate? The only thing that's different is, as you know, the policy acquisition rate on TypTap is a little bit higher, but you're sort of used to seeing that flowing through. The one thing that's a little bit different than what we've maybe seen is that the policy acquisition expense on the UPC book is higher. It comes in, I think 35% range. You see that increase that you see from, say, Q4 to Q1 is really just related to that, and then that will come back down a little bit over time. You see a little bit of a bump in the PAC rate in Q1, and it's really the UPC book. The higher tax rate, was there any offset in operating expenses? Yeah, good question. The tax rate can move around a little bit, but what was a little unusual this quarter is we had some restricted shares that were canceled, just as part of the reorganization Karin mentioned, separate management teams and whatever. There was a little bit of movement around in the restricted shares. Some new ones were granted, some were canceled. There was, I think, 140,000 restricted shares canceled, something like that, and then the dividends related to that get reclassified. We expense them in the GAAP books, but they're not deductible for tax purposes. We had this happen a couple of years ago where you have an unusually high permanent difference, and it's just sort of a one-time thing. I think that pushed the tax rate to 35% or 36% or something like that. Nothing's changed in terms of the overall long-term tax rate of about 27%, 28%. It's just an unusual thing, and operating expenses were a little bit higher than normal because of that reclassification that happened. It's just sort of a one-time thing, impacts the tax rate, and we were up against a very low tax rate in Q1 last year because we had some windfalls run through. That kind of explains that difference. Is that what you were getting at? Is that helpful? Yes, that is helpful. Thank you very much. Yeah, you're welcome. Thank you. Once again, ladies and gentlemen, you can press star one on your telephone keypads to ask a question at this time. Your next question is coming from Raymond James' Gregory Peters. Greg, your line is live. You may ask your questions. Good afternoon. Thank you for letting me ask a question. I wanted to pivot to the real estate operations. I noted that in your comments, you highlighted the fact that you're benefiting in part from mark-to-market adjustments in the value of the real estate operations. If I look at the schedule of what you own, the Florida real estate market, as you well know, is on fire, and I'm just curious about your buy, sell, and hold decision-making process as it relates to some of these properties. The Tierra Verde Marina property that you bought in 2011 has to be worth substantially more than what your cost is. Just looking for some perspective on that. Yeah. It's Mark. I'll take part of that question. In terms of sort of the mark to market, we're not taking advantage of it in any way in the numbers that you see, right? We've got some properties, as you alluded to, we've got some properties where there's a pretty substantial difference between what we have it on the books for and what it appraises for, let alone what potentially it might actually be worth. There's a pretty significant delta there, and that does not show up anywhere. We can't do any kind of mark to market or whatever. We used to talk about this a year or two ago. We would say we had $30 million maybe of unrealized gains there. We sold one property, and as you know, we had $44 million gain on it. We still have probably $30 million or so of unrealized gains that are there. It's part of our real estate strategy. Long-term strategy, as we've talked about before, is capital appreciation. I think we've made good on that strategy. We've realized some of that stuff in the past, and we'll continue to do that. There is that sort of hidden asset, if you will, on the balance sheet. We cannot take advantage of any kind of mark to market that we could do if they were equities or fixed term securities or something like that. Thanks. Just pivoting back to TypTap. You talked about the rollout into the new states, I know you just had a call on this, give us perspective of how you're approaching pricing for the new states, how you're developing pricing. Any background on that would be helpful. Absolutely Mark. Greg, sorry. I'm having a senior moment here. That's okay. I have them every day. The way we develop pricing is we're talking about being entry admitted markets and being admitted there. That means there's lots of data on incumbents in each of these states. At a high level, we tend to look at probably the top 10 carriers in any given state and see what their pricing looks like, et cetera. We try to develop pricing that is competitive with a couple of them that we would like to model ourselves after. That's roughly how the pricing is set. It's set to be market. We're slightly on the competitive side of market, in any given state. You have to do it state by state to see what's going on. Obviously at that point, you then have to go through the rate and form filings and you work with the regulators in each state to get the appropriate rates and forms filed and approved. It's quite a cumbersome process. I'm simplifying it a lot, but there are a lot of people who work quite a lot of hours in each state to get it just off the ground. Yeah? Right. Makes sense. Anyways, well, thanks for letting me ask the questions. Thank you. Thank you. Yeah. There are no further questions at this time. This concludes our question and answer session. I would now like to turn the call back over to Rachel Swansiger, who has a few closing remarks. On behalf of the entire management team, I would like to thank our shareholders, employees, agents, and most importantly, our policyholders for their continued support. We look forward to updating you on our progress in the near future. Thank you for joining us today for our presentation. This concludes today's call. You may now disconnect. Thank you for joining us today for our presentation. This concludes the call. You may now disconnect.