Heritage Insurance reports improved financial performance despite Q3 2023 losses

investing.com:

Heritage Insurance Holdings, Inc. (NYSE:HRTG) reported an improved financial performance in its Q3 2023 earnings call on Friday, November 3, 2023, despite facing significant challenges such as wildfires in Maui and Hurricane Idalia in Florida. The company's CFO, Kirk Lusk, and CEO, Ernie Garateix, led the conference call.

The company experienced a net loss of $7.4 million for the quarter due to the aforementioned catastrophic events. However, this marked an improvement from the net loss of $48.2 million experienced in the same quarter of the previous year.

Despite the decrease in policy count by 13.6%, Heritage saw an increase in its premiums-in-force by 8.4% to reach $1.35 billion. The company's strategic initiatives led to a substantial average premium increase of 25.5% year-over-year and a 5.1% increase quarter-over-quarter.

In Florida, Heritage selectively grew its commercial residential premiums-in-force by 75.3%, resulting in a more balanced and diversified portfolio with no state representing more than 27% of the company’s total insured value. This diversification strategy was achieved even amidst significant expansion in Florida's commercial segment.

The company also reported a decrease in losses and loss adjustment expenses by 15.7% for Q3 2023, primarily due to lower attritional and weather losses. The book value per share improved to $5.65, a notable 24.4% increase from Q3 2022.

The improvement in financial performance can be primarily attributed to growth in net premiums earned, an increase in net investment income, and lower weather and attritional losses. The annualized return on equity for the nine months ended September 30, 2023, stood at 13.6%, marking an improvement from the previous year's loss.

Herita