UVE
#There wasn't a reversal.
As I've mentioned in previous quarters, we have lowered our stock-based compensation.
And the reason it's been lowered is that it's a fixed dollar amount versus a fixed share amount.
When it was a fixed share amount, you had awards that would take place in the future, and as the stock price goes up, so too does the comp expense.
So now they're fixed dollar amount and we are experiencing less stock-based compensation as a result of that.
What also happened during this quarter in particular, is the reduction in pretax income from the storms reduced the basis from which we calculate management incentive bonuses.
So those two factors drove down the expense ratio, I think by about 2%.
We do have a target.
I'm not quite sure I can share that with you right now, <UNK>.
But I will tell you that we are seeing, as I said earlier, a very positive closing rate from our quote to bind.
I think, as we get a little bit more in depth with some marketing, some things that we have lined up to start doing, we are going to see this thing gain a lot more traction than it has.
We are very pleased right now that we have done $2 million in premium.
A lot of people said that this couldn't be done.
It was much too much of an extensive process for people to do online.
But I think we are seeing a segment of millennials and then people that just, their time is valuable to them.
They want to go ahead and do this type of process online.
So the best part about it is that we have built all these platforms, own all of these systems ourselves.
And it gives us the ability to change and manipulate it on a daily basis as we see fit to positively affect the platform.
So a quick answer to your question would be I think you are going to continue to see the growth that we have had since we've been on all these states in the last say three months.
And I think that the growth will be exponentially growing in a positive manner.
No.
We have seen really no AOB as it relates to that.
It's unquantifiable the number is so small.
Really, I think we've had 47 instances on 7,000 claims, so nothing really to talk about that's of any worry to us.
We booked $2 million above the actuarial [best].
No, not at all.
I don't have that handy.
<UNK>, I'd be happy to have a conversation off line with the schedule P in front of me.
Yes, obviously, like I said, we've been building this department since mid-2015.
And we are seeing approximately around a 10% return rate to us right now on our overall incurred losses that are affected.
Look, we run an insurance company that most of the claims are water related.
So baked into that, obviously, there is a lot of circumstances where we are able to recover from a subrogation perspective.
Since we started this in 2015, the beauty of it is, due to the statue of limitations, you can go back X amount of years and work on the claims that you had in those previous years.
So that's what we've been doing.
Working on that and trying to figure out how best to utilize our expertise in getting some of that money back from a subrogation purpose.
Theoretically, we have our own internal law firm here.
And inside, we use those folks as well as our other subrogation folks to participate.
And when we see claims from a fast-track perspective all the way up to large loss that we believe there are some subrogation connotation attached to it, we then put it into its appropriate bucket and then those folks start working on it.
So that's a huge part of our business.
Yes.
Well, I mean, when you look at the net returns year over year, we had about a 96% increase in net investment income, and that's the result of several things.
A lot of actions that we have taken.
We had about 33% increase in invested assets.
So that certainly accounts for some of it.
We have also, as the securities mature, or we put new money into the portfolio, we've been funding [munis] to take advantage of the tax benefits on that.
We have been reallocating our allocation from US governments over to those munis.
We have also extended the duration out.
Our average duration is now in excess of three years.
Where it was some years between two and three last year.
All of that has increased the yield.
And we have done that without necessarily sacrificing our credit quality.
We still have a very high credit quality of AA minus.
In addition to that, our returns have improved as a result of negotiations that we have gone through with our investment advisors to negotiate the fees down.
And that, certainly, increases return on investments.
Now, the rate environment.
Obviously, rates went up a little bit.
And they may continue to go up a little bit, and we will have the same impact as everyone else.
There's going to be no negative impact to any of our entities at all.
I would tell you that the only positive would be maybe there is additional organic business maybe that we could attain because of it.
But I would be cautious about that.
Because most of those smaller carriers were mostly takeout companies.
Again, I don't think it's anything that would be a negative for us at all and may be a slight positive.
Look, we are always open to the possibility of listening and looking in the MA arena.
We just haven't seen anything right now that fits our portfolio or what we want to do going forward.
We are very pleased with the way we are putting business on organically with our traditional agency force as well as Universal Direct.
We are always looking and listening, <UNK>.
But there isn't anything right now that I would tell you that is increasing our appetite.
Take care.
Have a good day.
As always in closing, I would personally like to thank all of our shareholders, employees, Board of Directors, policyholders, and my Management Team for their hard work and loyalty to Universal.
This concludes today's call.
Thank you.
