管理層發言
Good morning, and welcome to American Financial Group's Second Quarter 2025 Earnings Results Conference Call. We released our results yesterday afternoon. Our press release, investor supplement, and webcast presentation are posted on AFG's website under the Investor Relations section. These materials will be referenced during portions of today's call. I'm joined this morning by Carl Lindner III and Craig Lindner, Co-CEOs of American Financial Group; and Brian Hertzman, AFG's CFO. Before I turn the discussion over to Carl, I would like to draw your attention to the notes on Slide 2 of our webcast. Some of the matters to be discussed today are forward-looking. These forward-looking statements involve certain risks and uncertainties that could cause our actual results and/or financial condition to differ materially from these statements. A detailed description of these risks and uncertainties can be found in AFG's filings with the Securities and Exchange Commission, which are also available on our website.
We may include references to core net operating earnings, a non-GAAP financial measure, in our remarks or in responses to questions. A reconciliation of net earnings to core net operating earnings is included in our earnings release. And finally, if you're reading a transcript of this call, please note that it may not be authorized or reviewed for accuracy. And as a result, it may contain factual or transcription errors that could materially alter the intent or meaning of our statements. Now I'm pleased to turn the call over to Carl Lindner III to discuss our results.
Good morning. I'll begin by sharing a few highlights of AFG's 2025 second quarter results, after which Craig and I will walk through more details. We'll then open it up for Q&A, where Craig, Brian, and I will be happy to respond to your questions. We're pleased to report an annualized core operating return on equity of 15.5% despite quarterly returns from alternative investments that tempered overall results. Underwriting margins in our Specialty Property & Casualty insurance businesses were strong, and higher interest rates increased net investment income, excluding alternatives, by 10% year-over-year. In addition, we returned over $100 million to our shareholders during the second quarter of 2025 through a combination of regular dividends and share repurchases. Our compelling mix of specialty insurance businesses, entrepreneurial culture, disciplined operating philosophy, and an astute team of in-house investment professionals continue to serve us well in environments such as these and position us for long-term success. Craig and I thank God, our talented management team, and our great employees for helping us to achieve these results. I'll now turn the discussion over to Craig to walk us through some of these details.
Thanks, Carl. Please turn to Slides 3 and 4 for second quarter highlights. AFG reported core net operating earnings of $2.14 per share compared to $2.56 per share in the prior year-end period. Our 2025 results reflect a year-over-year decrease in underwriting profit and lower returns on alternative investments. I'll begin with an overview of AFG's investment performance and share a few comments about AFG's financial position, capital, and liquidity. The detail of our $16 billion portfolio was presented on Slides 5 and 6. Excluding the impact of alternative investments, net investment income at our property and casualty insurance operations for the three months ended June 30, 2025, increased 10% year-over-year as a result of higher interest rates and higher balances of invested assets. As you'll see on Slide 6, approximately two-thirds of our portfolio is invested in fixed maturities. In the current interest rate environment, we're able to invest in fixed maturity securities at yields of approximately 5.75%, which compare favorably to the 5.2% yield earned on fixed maturities at our P&C portfolio during the second quarter of 2025.
The duration of our P&C fixed maturity portfolio, including cash and cash equivalents, was 2.8 years at June 30, 2025. The annualized return on alternative investments in our P&C portfolio was approximately 1.2% for the 2025 second quarter compared to 5.1% for the prior year quarter. As a result, overall P&C net investment income was approximately 5% lower than the comparable 2024 period. The impact on rental rates and occupancy from a surge in new apartment supply in otherwise strong markets reduced the fair value of some multifamily investments. This tempered the performance of our alternative investment portfolio in the second quarter of 2025 by nearly $30 million. Although substantial supply persists, new construction starts have plummeted. We expect current inventory to be absorbed over the next 12 months. Notably, multifamily starts were down approximately 20% year-over-year and down nearly 50% from their 2022 peaks.
The combination of tightening supply and a significantly reduced development pipeline is forecast to drive higher rental and occupancy rates over the next several years and should result in stronger returns on our multifamily investments. Longer term, we continue to remain optimistic regarding the prospects of attractive returns from our overall alternative investment portfolio with an expectation of annual returns averaging 10% or better. Please turn to Slide 7, where you'll find a summary of AFG's financial position at June 30, 2025. During the quarter, we returned over $100 million to our shareholders, including $39 million in share repurchases and our $0.80 per share regular quarterly dividend. We expect our operations to continue to generate significant excess capital throughout the remainder of 2025, which provides ample opportunity for acquisitions, special dividends, or share repurchases.
We evaluate the best alternatives for capital deployment on a regular basis. We continue to view total value creation as measured by growth in book value plus dividends as an important measure of performance over the long term. For the six months ended June 30, 2025, AFG's growth in book value per share, excluding AOCI plus dividends, was 6%. Our strong operating results, coupled with effective capital management at our entrepreneurial opportunistic culture and disciplined operating philosophy enable us to continue to create value for our shareholders. I'll now turn the call over to Carl to discuss the results of our P&C operations.
Thank you, Craig. Please turn to Slides 8 and 9 of the webcast, which include an overview of our second quarter results. Overall, underwriting profitability was strong in our Specialty P&C businesses in the second quarter of 2025, and we remain confident about the strength of our reserves. A continued favorable pricing environment, increased exposures, and new business opportunities enabled us to grow our Specialty Property & Casualty businesses, and we continue to expect premium growth for the full year in 2025. Looking at a few details, you'll see on Slide 8 that our Specialty Property & Casualty Insurance businesses generated a 93.1% combined ratio in the second quarter of 2025, 2.6 points higher than the 90.5% reported in the second quarter of last year. Results for the 2025 second quarter include 2.3 points related to catastrophe losses consistent with results in the 2024 second quarter.
Second quarter 2025 results benefited from 0.7 points of favorable prior year reserve development compared to 2.3 points in the second quarter of 2024. Second quarter 2025 gross and net written premiums were up 10% and 7%, respectively, when compared to the second quarter of 2024. Earlier reporting of crop acreage by insureds impacted the timing of the recording of crop premiums and contributed to the year-over-year increase, particularly when compared to later reporting of acreage the previous year. So if you exclude the crop business, our gross and net written premiums grew 6% and 5%, respectively. Average renewal pricing across our Property & Casualty Group, excluding our workers' comp businesses, was up approximately 7% in the second quarter, consistent with pricing increases achieved in the first quarter, including workers' compensation; renewal rates were up approximately 6% overall, about 1 point higher than in the previous quarter.
We reported overall renewal rate increases for 36 consecutive quarters, and we believe we're achieving overall renewal rate increases in excess of prospective loss ratio trends to meet or exceed our targeted returns. Now I'd like to turn to Slide 9 to review a few highlights from each of our Specialty Property & Casualty business groups. Details are included in our earnings release, so I'll focus on summary results here. The businesses in the Property & Transportation Group achieved a 95.2% calendar year combined ratio overall in the second quarter of 2025, 2.5 points higher than the 92.7% reported in the comparable 2024 period. The second quarter 2025 combined ratio benefited from 2.2 points of favorable prior year reserve development compared to 6.3 points in the 2024 second quarter, particularly reflecting especially strong results for our crop business in the prior year period. Second quarter 2025 gross and net written premiums in this group were up 15% and 10% higher, respectively, than the comparable prior year.
As mentioned before, earlier reporting of crop acreage compared to 2024, which impacts the timing of crop premiums contributed to higher second quarter premiums in this group. Again, when you exclude the crop business, gross and net written premiums in this group grew by 6% and 5%, respectively. Increased exposures, new business opportunities, and a favorable rate environment contributed to our growth in our transportation businesses. Overall renewal rates in this group increased approximately 8% in the second quarter of 2025, a point higher than the pricing achieved in this group for the first quarter 2025. We continue to remain focused on rate adequacy, particularly in our commercial auto liability line of business where rates were up approximately 15% in the second quarter. In terms of our crop business, commodity futures pricing remains in acceptable ranges relative to spring discovery prices.
And based on the most recent crop progress reports, overall corn and soybean conditions are slightly better than last year at this time. We believe that there's been adequate moisture to date in those areas so that the excessive heat in recent weeks shouldn't be problematic. However, moisture levels through August and early September remain important. Now the businesses in our Specialty Casualty Group achieved a solid 93.9% calendar year combined ratio overall in the second quarter, 4.8 points higher than the very strong 89.1% reported in the comparable period in 2024. Second quarter 2025 gross and net written premiums increased 4% and 2%, respectively, when compared to the same prior year period. Higher year-over-year premiums in our mergers and acquisitions business and growth across a variety of other businesses in the group, resulting from new business opportunities, higher rates, and strong policy retention were partially offset by lower premiums due to a challenging market in our Directors and Officers Liability business.
In addition, we continued to nonrenew certain housing and daycare accounts in our social services businesses. Excluding our workers' comp businesses, renewal rates for this group were up 8% in the second quarter. Pricing in this group, including workers' comp, was up about 6%. I'm pleased that we achieved renewal rate increases in the mid-teens in our most social inflation exposed businesses, including our social services and excess liability businesses. The Specialty Financial group continued to achieve excellent underwriting margins and reported a combined ratio of 86.1% for the second quarter of 2025, 3.6 points better than the 89.7% reported in the comparable period in 2024. These results reflect higher year-over-year underwriting profitability in our financial institutions and surety businesses. Second quarter 2025 gross and written net premiums in this group were up 15%, 12%, respectively, when compared to the prior year period, due primarily to growth in our financial institutions business.
Renewal pricing in this group was flat in the second quarter. Craig and I are proud of our history of long-term value creation. We have years of experience navigating economic and insurance cycles. Our insurance professionals continue to exercise their Specialty Property and Casualty knowledge and expertise to successfully compete in a dynamic marketplace. Our in-house investment team has been both strategic and opportunistic in the management of our $16 billion investment portfolio. One of our greatest strengths is finding opportunities in times of uncertainty. We feel we're well-positioned to continue to build long-term value for our shareholders for the remainder of 2025 and beyond. I will now open the lines for the Q&A portion of today's call. Craig, Brian, and I would be happy to respond to your questions.
分析師問答
Our first question comes from Michael Zaremski at BMO Capital Markets.
My first question is about the lender-placed business within Specialty Financial. I believe that area is contributing to the ongoing strong growth this quarter. Looking at the bigger picture, could you explain how we should consider the growth of that market? Does it correlate with mortgage delinquencies or does it depend on whether the market is hard or soft? Additionally, could you provide more insight on whether you feel you have gained market share in that sector?
Thank you. The lender-placed property business has relatively few competitors. Currently, it generates about $700 million in gross written premium, making it a substantial part of our operations. This segment tends to thrive in a weak economy when individuals fall behind on their payments and fail to pay their insurance. The business relies heavily on strong relationships with significant financial institutions. Over the past couple of years, market disruptions have allowed us to seize opportunities as some competitors struggled, which has contributed to our growth. Additionally, until this year, we, like others in the property sector, have implemented significant rate increases. Another factor that has positively impacted this business is the shift in our portfolio from insuring unpaid mortgage balances to focusing on replacement cost values, which is becoming more common in the industry. As more clients and major accounts transition to this model, it will provide us with more accurate valuations for our business. Is there anything else I can clarify about the business?
Carl, would the lender-placed also have excellent margins in the segment? Is that also what's driving the pricing power kind of to decel?
Yes. I think this business is very profitable for us, again, made up of large accounts. I think pricing in this business through six months is up about 1%. The loss ratio trends are very low single digits in this business. And I think, again, the last thing I mentioned as far as a move from unpaid mortgage balance as a basis for premiums to move to replacement cost values. I think that helps offset the difference between the price increase and the loss ratio trend, if that makes sense.
Yes, that's helpful. My follow-up is about some of the more socially inflationary lines of business. You mentioned some nonrenewals in certain areas. I'm assuming there are always nonrenewals happening, but you're highlighting this because it seems to be at a higher than normal level, which AFG wouldn't typically expect. I understand the situation with loss cost inflation is constantly changing. Could you provide a general overview or discuss the comparisons between commercial auto and the other sectors like housing and daycare? Where does AFG stand regarding remediation actions, and how do you feel about the balance between pricing and loss trends? That's my final question.
That's a complex question considering we're involved in 36 businesses. In our nonprofit Specialty Human Services division, we have addressed both housing and daycare accounts. We have mostly completed the nonrenewal efforts for the housing accounts, which were part of the $50 million goal we mentioned previously, with about $20 million related to that. We no longer provide property or liability insurance for low-income or affordable housing accounts. Regarding daycare, we estimate that around $9 million or $10 million remains to be nonrenewed by year-end. We initiated this process earlier this year and expect it to be finished by the end of the year. We still underwrite a significant number of YMCAs that provide daycare, so we continue to engage with agents who have established business in that domain. However, a considerable portion of our daycare business that was unprofitable will be completed by year-end.
Additionally, we've been reducing umbrella capacity from $15 million to $5 million, and we currently have about $20 million in-force umbrellas exceeding $5 million, which will likely be zero by year-end. This sector has faced more social inflation exposure compared to others. We have also been increasing retentions in the public sector and expect to find more opportunities in that area as we progress through the cycle. In the excess liability segment, a few business units are still experiencing mid-double-digit price increases. We've also adjusted limits downward, moved certain limits upward, and non-renewed accounts with higher commercial auto liability exposure. In our Fortune 1000 business, we believe we are nearing completion of our adjustments in that custom book, paving the way for growth. While commercial auto liability has not been a strong part of our Specialty Casualty business, we saw healthy growth in the second quarter and are outperforming the industry by about eight points.
We are still working towards achieving an underwriting profit in that area, but with a 15% price increase, we are beginning to see more opportunities. We are aware of one MGA potentially exiting a specific segment within commercial auto, which could present an opportunity over the next six months. I hope this addresses your various inquiries.
Our next question comes from Gregory Peters at Raymond James.
I would like to focus on the Inland Marine, Ocean Marine business, and possibly the trade credit business as well. From what I’m hearing from other specialty players, there seem to be growth opportunities in that sector. How is your company positioned for growth in this area? Additionally, since there's marine cargo involved in trade credit, what impact do you think volatility and tariffs will have on that business in the interim until things stabilize?
We have a strong Ocean Marine portfolio in both the U.S. and Singapore. Our emphasis on Ocean Marine has been robust, and our Inland Marine segment is also performing well, although we are focusing more on builder-specific Inland Marine coverages rather than just large property placements. Both areas have been beneficial for us, with Ocean Marine offering growth opportunities in recent years. However, on the Inland Marine side, opportunities for builders' risk have been limited due to current economic conditions, possibly influenced by tariff activities. This situation has somewhat constrained our property Inland Marine business, which traditionally includes builders' risk and Inland Marine products. Over time, both sectors have proven to be profitable for us. The impact of tariffs remains uncertain, but it's clear that Ocean and Inland Marine could face challenges if shipping and cargo transport volumes decline. At this moment, we aren't seeing significant effects, but the real concern will arise as tariff changes are implemented on a country-by-country basis. That's my perspective for now.
Would you say the same thing about the trade credit business too as it relates to tariffs?
Actually, our trade credit business is growing. I think there's been a little bit of hardening in that market. It's a very, very small specialty business for us. But yes, I do think, depending on who gets what tariff and what country it could have some impact, probably more on the premium side at some point. But right now, if anything, we're seeing some growth there.
I would like to revisit some of the points you made in your opening remarks, particularly regarding mergers and acquisitions. I'm curious if there has been a change in market conditions that would indicate a larger pipeline today compared to a year or two ago. It seems like you're consistently active in the market, so when you mentioned it during the call, I wonder if there are developments in the works. I would like to hear your thoughts on the M&A aspect since you highlighted it.
Sure. M&A is a $100 million type of business for us. It can be somewhat volatile depending on the M&A environment in this country. This year, there seems to be a lot of activity, whereas last year saw a lower level of activity, making it a smaller business. However, this year we've experienced considerable activity, supported by a very capable group of underwriters in this area. It's been a profitable business for us. Others have tended to focus on some of the fringe, higher-risk aspects of this business, which we have not as much. We're primarily focused on the representations and warranties, tax indemnity, and credit insurance aspects. We have built a good reputation and are recognized for our strong specialist knowledge in this field.
Our next question comes from Andrew Andersen at Jefferies.
Yes. This is an early indication from a crop peer that 2025 could be good to very good for crop profitability. In your prepared remarks, there were some positive indicators. I'm curious if we should still view this year as an average year or if it's too early to tell.
I think it's still too early for us to categorize this year as average, above average, or below average. However, looking at commodity futures pricing, they remain within acceptable ranges compared to spring discovery prices. I didn't see the final numbers yesterday, but I believe corn is down about 14% and soybeans are down just under 6%. The average deductible chosen by farmers in our business, excluding rainfall products, is projected to be around 20.5% this year. Farmers need to experience losses or a combination of a decrease in commodity prices and losses exceeding this deductible. Recent crop progress reports show that the overall conditions for corn and soybeans are slightly better than they were last year at this time. There has been some concern about excessive heat, but we have received adequate moisture so far, which we don't believe will cause issues. It’s important for good moisture levels to be maintained in August and through early September. Additionally, the Big Beautiful Bill has led to an increased loss adjustment expense payment for states with over a 120% loss ratio, with the LAE payment now at 6% compared to the previous 1.5%. While there are always minor tweaks in programs that may have negative impacts, generally, there are more positive developments over time. The Farm Bill has been extended through September of this year.
Okay. And then just pivoting, I think your workers' comp book is slightly skewed to specialty workers' comp. So just curious how the pricing environment is in that end of the market. And if you expect any positive momentum on the workers' comp front? And also I think California is the largest state for workers' comp for you. So just curious if you're seeing any different loss experience there.
California represents approximately 15% of our workers' comp business, while Florida is likely larger. Workers' comp accounts for around 13.5% of our total gross written premium. Our overall results for the second quarter and the first six months remain strong. Although the combined rate for the first half of the year is slightly above last year's figures, our National Interstate division, which focuses on transportation-related workers' comp, as well as our Southeast Summit and large deductible strategic comp segments, have achieved favorable underwriting results this year. However, Republic, our California workers' comp division, recorded an underwriting loss in the second quarter, but we believe we maintain a solid reserve position. Regarding pricing, we've noticed a moderating trend. Overall workers' comp pricing declined by about 1% in the second quarter of this year and over the first six months.
In Florida, which is our largest state, the 1% decrease implemented in January was the smallest drop in seven years. In California, we obtained a roughly 5% price increase in the second quarter, resulting in a 1% increase year-to-date. Importantly, California has approved an 8.7% increase effective September 1, 2025, marking the first rate hike in a decade, which is necessary given the industry's combined ratio in California is in the 120s. Our underwriting loss is more moderate, and historically, we've performed better than the industry. I am optimistic about the emerging trends in the workers' comp pricing environment, particularly in California, where a firmer market appears to be on the horizon.
Our next question comes from Meyer Shields at Keefe, Bruyette, & Woods.
Carl, I was hoping if you could dig a little bit deeper into what you're seeing in terms of pricing and rate adequacy and professional lines. I'm asking because you sounded somewhat cautious, and we've heard a couple of other carriers talk about maybe green shoots are bottoming. And I just want to get your perspective on that, please.
Sure. From an overall macro perspective, we have good results in the second quarter and the first six months for our D&O business and our banking-related D&O product business, ABIS, which is significant for us at $400 million in D&O and ABIS. When considering the other professional liability business we write, it totals over $0.5 billion. Net written premiums decreased in the second quarter and for the first half of the year. We continue to find the public company business competitive; however, I am encouraged to note that prices in that segment only dropped by 1.6% in the second quarter. Overall, rates for our D&O executive liability businesses remained flat in the second quarter and year-to-date 2025, which aligns with our expectations for the year. I'm particularly pleased to see the pricing for public companies stabilizing. It’s important to note that public D&O accounts for only 15% of our D&O premium, making us more opportunistic in that area. In our ABIS financial and related D&O products, pricing increased by about 4% over the first six months of this year. While the public D&O market continues to be competitive, there are clear signs of stabilization, especially with primary policies. I hope that's helpful.
It is very much so. And I just want to confirm because I'm trying to get my head around the impact of the earlier crop reporting. Should we think of some portion of the premium losses and related expenses that showed up last year in the third quarter as moving to the second quarter this year? Is that how that plays out?
Brian here. To start with the premium side, we expect crop premiums for the full year to be slightly lower than last year due to lower commodity prices during the discovery period this year. However, in the second quarter, earlier planting and reporting of acreage is offsetting this. We estimate that the shift in premiums is about $100 million gross and $40 million net when comparing quarter-over-quarter. This means that some premium expected to be reported in the third quarter has been reported in the second quarter because of the advanced reporting. So, a flip in quarters on the top line indicates that $40 million in net written premium reflects that change. Regarding profitability, in our crop business, we generally report close to zero profits in the second quarter, with only some profit coming from prior periods as most crops are still in the ground. Consequently, we typically report the majority of our profitability in the fourth quarter, with a bit in the third. This can also develop favorably into the next year. Therefore, when examining our numbers, you can consider our combined ratio in crop being around $100 million in the second quarter. If it ends up being profitable, that can improve our combined ratio in the fourth quarter, all else being equal. Thus, while there's no significant impact on profits, there is on the written premiums.
Okay. That's helpful. But just take it one step for this. That means that whatever the earned premium component of that $40 million that's producing a higher combined ratio than the rest of Property and Transportation, that's moved from the third quarter to the second quarter. So there's a little bit less of that 100% combined ratio earned premium in the third quarter. That's what I'm trying to get at like...
And that's a little tricky because in some of our earlier season products, which generated more earnings in the first half of the year, we did see some growth and changes in the amounts we ceded. Therefore, the earned premium is higher for various reasons in the second quarter as well. I would say the key factor influencing profit recognition will be the weather over the next couple of months and whether it leads us to exceed average conditions. As Carl mentioned, the forecast appears positive, but we want to avoid making any premature conclusions.
Our next question comes from Bob Farnam at Janney Montgomery Scott.
I have a follow-up question regarding workers' compensation. I've received some inquiries about undocumented workers and their potential impact on the types of classes you write. Specifically, have you noticed or do you anticipate any shifts in claim patterns as undocumented workers are replaced by citizens or documented workers? The concern is that undocumented workers are less likely to file workers' compensation claims due to fears about their immigration status.
This is Brian. When we insure our companies, we provide coverage for all their workers, regardless of their immigration status, and we will fulfill any claims that arise. In terms of whether a decrease in undocumented workers being replaced by documented workers will affect our operations, we have not observed any changes so far. We will continue to pay all the claims we are obligated to and charge the appropriate premiums based on the payrolls in place, regardless of the workers' documentation status.
Yes. The question was whether undocumented workers avoid filing claims due to concerns about their status. Are you anticipating an increase in reported claims as undocumented workers are replaced by those who are documented? That was the inquiry.
Yes. At the moment, we're not expecting that, but it's obviously something we'll keep an eye on as we price our business and set reserves going forward.
Okay. And so I also have some questions on the excess liability business. You've had modest adverse development over the last several quarters. Is that related to any particular accident years or particular lines of business or classes of business? I'm just kind of curious if what you saw this quarter? Is it similar to what you saw in for most of last year and in the first quarter of this year?
This is Brian. First, I want to highlight that our reserves continue to grow positively, with $11 million in net favorable development this quarter. In the Casualty Group, however, we encountered $10 million in adverse development, primarily due to increased severity in our businesses that are affected by social inflation, especially in the excess and surplus lines and our nonprofit social services. In these areas, we experienced an increase in settlements, leading us to adjust our case reserves for known claims and increase our incurred but not reported reserves for similar potential liabilities. The claims in these social inflation affected businesses can be variable, and when analyzing the adverse development by accident year, it is distributed across many years rather than concentrated in one specific instance. We have also taken a cautious approach with our current accident year picks, increasing some values for the same reasons. We consistently learn from our observations and adjust our loss picks and pricing in a timely manner to sustain or enhance our strong performance.
Right. Okay. Do you write the primary layers on that excess liability book? Or is that third parties that write the primary layers?
Where we're seeing the adverse development is mostly coming out of the ones where we are writing the excess layers.
Our next question comes from Michael Zaremski at BMO Capital Markets.
My question is on the previous $10.50 '25 guide. Obviously, the Street is lower due, in part, to the first quarter investment returns. I guess my question is focused on the maybe the year-to-date reserve releases of about one point down 65% approximately year-over-year. Still obviously a very good guide, releases, great to see. Would you be able to share whether that reserve release ratio is better or worse in line with what you had contemplated when putting that guide together, the $10.50 guide?
With so many different lines of business and products, it's really hard to say. I think if you remember, we talked about when we gave our business plan assumptions at the beginning of the year, we did talk about an expectation of lower levels of favorable development. Now all the reasons behind that ended up not necessarily being exactly what we thought in the beginning. But we did anticipate, and I think, hopefully did share that we thought that some of the favorable development we would have been seeing would diminish a bit, and that we're optimistic about improvements in the accident year ex-cat loss ratio, which we did see improvements other than where we were more prudent on some of the social inflation exposed businesses. So I think overall, it's pretty much in line with what we were expecting but not necessarily business unit by business unit, but within a range, I'd say, yes.
This concludes the question-and-answer session. I would now like to turn it back to Diane for closing remarks.
Thank you all for joining us this morning and for the great discussion and good questions. We look forward to talking with you all next quarter when we share results for the third quarter. I hope you have a great day.
Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.