United Fire Group (UFCS) Q2 2024 earnings summary

Executive summary

• Net written premiums grew 9% year-over-year to $326.1 million in Q2 2024, led by Core Commercial and Alternative Distribution units.

• GAAP combined ratio improved by 27.4 points to 105.6% compared to Q2 2023, reflecting better underwriting and lower catastrophe losses.

• Net loss of $2.7 million ($0.11 per diluted share) included a $3.2 million pre-tax charge for rating errors.

• Net investment income rose 59.2% year-over-year to $18 million, driven by higher fixed maturity income and alternative asset valuations.

• Book value per share decreased to $28.68 as of June 30, 2024.

Financial highlights

• Net premiums earned increased 12.9% to $287.6 million in Q2 2024.

• Net investment income was $18.0 million, up 59.2% year-over-year.

• Net loss per diluted share was $0.11; adjusted operating loss per share was $0.07.

• Combined ratio improved to 105.6% from 133.0% in Q2 2023; underlying combined ratio was 94.4%.

• Return on equity for the quarter was 2.9%.

Outlook and guidance

• Management expects continued premium growth and improved underwriting results, supported by pricing actions and expense management.

• Strategic investments are increasing near-term underwriting expense ratio but are expected to yield larger benefits to loss adjusting expense ratio.

• Alternative Distribution is targeted to reach 25% of the total portfolio.