I'm Mike Nici. I'm the property and casualty insurance analyst here at Goldman Sachs. We're pleased to have with us today The Hartford. Hartford is a leading domestic insurance company with a market cap of about $18 billion, and a franchise focus on commercial lines, particularly in the small and middle market, as well as personal lines led by the company's AARP initiative or partnership, I should say. Chris Swift and Doug Elliot will be joining us shortly. Weather-induced delays in the tunnel have created some minor problems, but they should be joining us momentarily. In the meanwhile, no delay and no gap in quality here. We have Beth Bombara from The Hartford, the CFO. She was Controller from 2007 to 2012. She was the head of Talcott following that, and then was promoted to the company's CFO. With that, we'll sit down.
Beth, I don't know if you want to make some intro comments, or we can just head right into Q&A. Then we'll go from there. Please feel free to ask questions as we move. Thank you.
I think if you want to just head right into Q&A, I think that would-
Sure
be fine.
Sure. That's great. I guess one question. We can talk a bit more about capital than we had anticipated. Maybe we can start with just Talcott and talk a little bit about how we should think about the potential drawdown of capital there. When you look forward and look at The Hartford, five years from now or whenever you anticipate that that wind-down is complete or near materially complete, what should this capital profile of the company begin to look like?
Okay. Yeah, it's a question that we get a lot. First I'll say that we're very pleased that that's the question that we get now. I reflect on the fact that when I first took over as president of Talcott, the question was always, do we have enough capital in those entities? With all of the work that we've been able to do to reduce the exposure, primarily coming from the sale of Japan, we're in a much different position. At the end of September, we had about $5.6 billion of statutory capital in the legal entities that comprise the Talcott Group. What we've been talking about, and we said on our third quarter call, is that we are looking at redefining what we think the capital levels of that entity should be over time.
In the past, we have looked to maintain adequate capital in what we refer to as stress scenarios, where we stress markets, we stress interest rates, and want to always ensure that we have adequate capital. We used to measure that using an RBC ratio of 325%. With the sale of Japan and that significant risk out of those entities with the movement of our group benefits business completely out of the Talcott entities, we've started a process to look at what should the right targets be in those stress scenarios. What we've told people is that we plan in our February earnings call to talk about what we think that recalibration should be, and to provide some guidance as to what we would expect over time that would mean to be able to redeploy that excess capital.
On top of that, when we look at the business that's left in Talcott, we see the capital generation from just the earnings that we're generating on that business being at around the $250 million-$300 million range. We look at that as a source of capital going forward as well. To your point, as the business continues to run off, we would expect capital to be released as well. We always remind people that we have both a variable annuity book, but we also have a fixed annuity and institutional liabilities. Our fixed annuity and institutional liabilities have a little bit longer duration.
Again, in our February earnings call, we'll provide some updates to some information we had shared in April 2013 on how we think about the capital being allocated to those pieces. We do see it, the entities in total, as a source of capital over time.
Got it. In terms of it is, you mentioned Japan, and as that has come out, how has your hedging program changed? Obviously, the currency piece is no longer there, but other than that more kind of obvious element, what has been the impact of that de-risking on the intensiveness of your hedging program-
Maybe a little bit on the cost as well?
Yeah. The way that we hedged our Japan exposure is all of that hedging was done in our U.S. legal entities, even though all of the liabilities did not reside there. What that resulted in was a significant amount of volatility related to that hedge program. When we completed the sale of Japan on June 30th, we effectively terminated all of those hedge positions, because they were no longer needed. A significant source of volatility went away. When we look at our U.S. book, we have in the past primarily hedged that in two ways. One, we hedge the withdrawal benefits associated with the guarantees in our products with a dynamic hedging program.
That has worked very well and what you can see there is because both the liability and the derivatives are marked to market, it's very easy to see in our results the effectiveness of the hedge program. For the most part, they offset. We're not 100% hedged, so there's always a little bit of noise.
You can see that. We really haven't changed that program. The second part of our hedging program is what we refer to as our macro hedge, which is really hedging the death benefits associated with the book. There, over time, as markets have improved, we have been able to spend less on that program, and we'll continue to look to ways to most efficiently hedge that exposure. We do see those costs coming down, too, in this type of market environment. Again, all of that results in less volatility that we see in the U.S. stat entities. We do focus on that.
I tell people that with the sale of Japan, oftentimes I get the question, "Well, doesn't that mean that your stress scenarios must look so much better because you don't have that exposure?" Ironically, with Japan, because the liabilities weren't there, in severe stresses, we got these big gains from hedge programs.
Right.
The real benefit is more so that in these benign markets and as markets increase, we're not chewing up statutory capital with hedge losses.
We'll see much more, we believe, predictable sort of earnings coming out of those entities, which again, we hope over time will allow us to have sort of a steady source of capital that we can extract.
Right. In an environment where spreads have tightened over some period of time, is sale of Talcott a possibility at some point, or do you anticipate holding the portfolio and running off the book as your kind of course of action?
We've always said from the beginning that, and when I say the beginning, I mean the beginning of putting Talcott into runoff, is that we would evaluate opportunities to accelerate the de-risking of that and the runoff of that business. It has to make sense from an economic perspective. When we looked at the sale of Japan, that was a pretty easy decision for us to make given the economics that we were able to achieve and the exposure there. When we look at what's left in the U.S. book and our ability to manage that, we don't feel a need to rush out to do a transaction that we think would most likely be dilutive from a GAAP perspective. It's something that we'll continue to monitor.
We've also talked about the fact that interest rates being as low as they are, especially with our book that has these longer duration, our institutional liabilities that I referred to before. Think of those as structured settlements, pension buyouts. To transact at these low interest rates, we're probably just locking in losses that we don't need to.
Right.
As long as we can continue to manage it and look at that trade-off, that's where we'll be. If the right opportunity provided itself, we obviously would take a look at that.
When you think about the capital coming out of Talcott, can you talk about your deployment plans? I know you've talked about sort of splitting between buybacks and debt reductions. Is there a way that we should begin to think about that allocation depending on how the environment shifts? A rising rate environment or a continuing kind of plateauing of commercial pricing on the P&C side. Are there signposts for how we should think about you tilting or shifting your allocation of capital coming out of Talcott?
I'd say a couple of things. In our view of deploying excess capital, we are trying to do it in ways that obviously are accretive, but also fulfilling our long-term objectives. In a lot of the capital management actions that we've taken in the past, we have been balanced in both share buyback and debt reduction because we do believe that over time, we do need to reduce the debt that we carry. We've stated that our objective is to have our leverage ratios be in the low 20% using rating agency models. Right now, we're in 27%. We're always going to continue to look at that. What we said is that that's a goal. It's not something that we feel we have to get to overnight.
When we have excess capital, we'll think about what is the best way for us to deploy it. It's not a formula per se, but we do believe that people should expect us to continue to be balanced and then also look for opportunities to deploy capital to continue to grow our ongoing business.
Great. Beth, thank you very much. Excellent pinch-hitting by Beth.
Hey.
We really appreciate it.
Anything for my teammates here.
I don't know, Chris, did you want to get up and throw a presentation up? I don't know. Do we have that available? Oh, there's no presentation. Okay.
He's going to comment.
Oh, do you want to make a comment?
No. Thank you, Michael. I'm sorry we're late. It was a four-hour commute from Hartford this morning for Doug and I. We misjudged the nor'easter. Thank you for having us.
As an insurance company, you misjudged the nor'easter?
Yeah.
I didn't. He flew in out.
That's true. Should've came in last night. All I wanted to say is that on behalf of Doug and Beth and myself, that we're so excited to be here and tell you a little bit more about what we're going to do going forward. If you look back on 2012, we really consider 2012 to be a breakout year for us for a couple of reasons. One, we've worked so hard to restructure the organization over the last three years that Liam started. If you look at what we accomplished this year, culminating in the fact that we were able to sell the Japan annuity business at a good price to a good strategic buyer.
That Doug and his team have done to improve our P&C group benefit businesses going forward, and the three great quarters of growth that they printed, margin expansion, improving our capabilities, working to make investments in the organizations. As Beth was just talking about capital management, the ability to expand our capital management program here in 2014. We just think that we've accomplished a lot, and we have a lot of momentum as we head into 2015 from a business side. That's all I'd like just to point out from a high level, Michael.
I appreciate that. Thank you again for being here. I really appreciate it. I guess maybe now, Chris, looking at the company as it is today and thinking about your sort of vision for the company, and as you take kind of this next sort of episode in Hartford's lifecycle, what are the elements of the company that you want to build, maybe that are different from today, and what are the areas of strength you really want to leverage?
It's a great question. Really between Doug and myself, we'll handle that. You really think about again what we've accomplished and what we're able to build upon going forward, we put it maybe into three or four key areas. First area would be product and risk appetite. Second area would be distribution effectiveness and managing the great relationships that we have throughout our distribution partners. Third, we would characterize as investing in our capabilities, Michael, whether it be internal tools and new technology that we're deploying, ultimately centered around a customer experience that we're trying to improve our ease of doing business.
Lastly, Beth touched upon it again, is just managing our capital, because we are in a fundamentally different position with improved financial strength, with improved capital generation, and continue to run Talcott off over a period of time and really redeploy that capital into our go-forward businesses. We're trying to harvest that capital appropriately into accretive actions, whether they be capital management actions or additional investments. Doug and I talk quite a bit about product. We talk quite a bit about risk appetite, geographic expansion, and maybe Doug can just give a little bit of color there, too.
Sure. Good morning, everybody. I would say this, that particularly in the middle market, we've been on a product build journey for the last three years. When I arrived in 2011, primarily we were a workers' comp market for that middle market customer. It's an important segment for us because we have such strength in our small commercial enterprise down below that we're trying hard to provide the same degree of strength up in the middle market. We've been on a three-year journey with property liability and also some auto work around our workers' comp product as the core, and we feel terrific about those three years of progress, right?
As we think about how we're hitting the market today and have hit it over the last several quarters, we've tried to be clear with you that our product balance is much better than it was three years ago. I think our ability to go to market and to offer product in a thoughtful way from a risk perspective is in much better shape today, and really very excited about how that sets us up for 2015 and beyond. It's been a journey. There's no question that at the core of our P&C commercial franchise, we have a gem with small commercial, but we're working hard for that middle to be just as strong over the long term, and I feel like we've taken some really strong foundational steps to get there.
Anything on the product side? If you think about products that maybe you don't write today that you would consider kind of building into, are there sleeves of business or maybe areas of distribution that you want to leverage to kind of build the amplitude of The Hartford's product offering?
I think you'll see us look at verticals a little more aggressively over the next couple of years. I would say this, that we've done a lot of work inside the core pillars, so our property, our general liability on our auto pillar to complement workers' compensation. As I say that, I think we're a much better competitor today in the manufacturing space. We had a really neat win a month ago in the renewable energy space that three years ago would not have been something that we would have even been able to look at. There's just a number of beginning roots that we feel really good about that, Mike, I see this as really the beginning of a risk journey that three years ago we weren't really capable of being a part of.
For these verticals, are you leveraging your current distribution, or is there an opportunity to kind of look at more specialized distribution at some point?
I think we have great distribution, today's platform, and particularly for the middle. We'll always look for new partners, but I love the foundation we have. I think it's been a strength of this franchise for a long period of time, and we're trying to bring more out of it. I do think when I arrived, as we listened hard in 2010 and 2011 when I was here, they were anxious for us to be a broader player, to be a bigger risk player. I would say to you, Mike, that that's just beginning as we go forward. I think we've got the partners to do business with. We just have to seek them out, and I think today we have some tools that better enable us to do that. Chris.
I think one of the anecdotes was I just was on a West Coast and Texas tour last week for five days from San Francisco to L.A. to Houston. All those markets are a little different with different types of risk and different types of needs, from wind to quake to sprinklers, to everything. Consistently, what I heard from our distribution partners is we could do more business together just with a little bit of a broader risk appetite in certain classes of business that maybe we haven't historically played in. I think that's really what Doug means is that there's risk categories, there's industry verticals that we're exploring to basically bring our national brand and bring our strong distribution partners along with us as we continue to grow.
I think the beauty of being a focused organization. We've worked hard to be a focused P&C commercial, personal lines, group benefit organization. Generally, there's only one way to go. You need to be deeper in your chosen market. I think that's the next leg of our journey that we're going to tackle together.
Doug, you mentioned middle market. As you look to kind of continue to take the learnings from small commercial and optimize that business, what are you focused on more? Is it kind of market penetration? Is it growth? Is it the profitability gap with small commercial? How are you sort of calibrating your initiatives and evaluating your success and implementation in that part of the market?
I'd start with our financial performance. I feel very good about the progress achieved across all our markets, but particularly middle market relative to improved rate adequacies and the combined ratios, right? We share pretty transparently our progress across middle, and as you looked at third quarter, and really progress the last couple of years, we feel good. We're in a good spot. Mid-90s is a good spot to be. Now with the yield curve, we'd like to be a little bit lower. We're working at that. In general, we start there. We think about the rest of the competencies. You can build product, but you have to train your people to be able to use that product. We've been working hard the last 18, 24 months on the training side. Really a neat opportunity.
I think many of you know our technology, we think in small commercial is world-class. We'll be rolling out a desktop for our middle market underwriters in the next 90 days that is the first of its kind for us. We've been a much more manual world than we need to be for 2015 and beyond. Very excited about what that will do to speed, productivity, efficiency, and our ability to respond to requests as they come our way.
Got it. I guess one question kind of thinking more broadly looking out in terms of clearly the P&C company continues to generate capital. You're generating capital out of Talcott. You talked about balanced approach to capital management. Do you see at some point looking to allocate capital back into the business on the P&C side to support potential for growth or new initiatives? Or is that not really an area where you're kind of thinking about allocating capital at this point?
As I said, we do want to take the capital out of Talcott and invest it in capabilities, whether that be tools, whether it be product sets, whether that be risk appetite to support increased writing. I think the good thing right now is that we feel very confident and strong about our financial position so that the P&C company does not need capital today to support our growth plans. As it continues to generate capital, we take out our normal dividends. We think we have plenty of flexibility to manage our capital and in a creative way to shareholders.
Does the reinsurance market play a role in that? When you look at kind of reinsurance market conditions and, again, to the extent that you see growth initiatives, does leveraging kind of a relatively soft reinsurance market allow you another lever, if you will, in looking for ways to sort of.
Doug and Beth can comment, too, but I think it is a lever. I would say it's a relatively small lever for us. If you look at the amount of, I'll call it real ceded reinsurance ex pools and associations that we have to participate in, we cede about $250 million-$300 million of premiums. Some of it's for classes of business that we just don't retain, like equipment breakdown. Our property cat treaty will benefit from the continued availability of capital and risk there. We're in market right now to renew our one-one cat program. We're aware of activities that are happening in the marketplace. Doug, Beth, and I explore different options, it's not a major lever, I would say right now. Beth?
Doug, do you want to talk about the property expansion that we did and the program there? Because where we can find opportunities as an example.
We just renewed our property surplus treaty effective July 1. Essentially gives us $500 million per four walls of capacity. Just to give you a sense of that journey, when I arrived in 2011, very few risks came our way that had property schedules greater than $50 million, right? Over the course of three years, it's not that today we're looking at just a full diet of $500 million risk, but we have the ability, we have the tools, the pricing capabilities, and now the talent to look at those, and those are opportunistic plays. That's an example of a reinsurance treaty that is a needed partner for us and one we feel very good and feel like we earned.
Makes sense. I guess one sort of topical question today, shifting a bit. Energy prices clearly have come in quite a bit. Can you talk a little bit about how you perceive that impacting or the different elements of The Hartford's business? I'm guessing more on the personal lines side, but also some element on the commercial side as well, although I know you pulled back a bit on commercial auto.
I guess a couple of things. One is that when prices are low, we do expect to see miles driven go up a little bit. We expect over the holidays, there'll probably be more people taking to their cars and traveling. More cars on the road, something we need to be mindful of relative to frequency of occurrences. Like as I also said in the quarter, we're mindful of the winter and the winter weather. Last year with the vortex, it was something that we did see iced events, actually like we saw this morning in the Northeast. We're mindful of that as well. On the commercial side, the commercial auto line is just challenged right now from many different avenues. I think we're working our levers as hard as we can.
We're working, obviously, pricing, and as the last couple of quarters have played out, auto will be our lead pricing line in terms of pricing achieved. I expect that to happen again in the fourth quarter. We're also working a number of underwriting angles inside our book of business as well. Kind of a multi-pronged attack on the commercial side and mindful of both weather and the fact that gas prices are down.
Got it. I think the two other tangential areas from a commercial side, we're not a big player in the energy sector, broadly defined, with commercial workers' comp risk, property risk, general liability risk. The other side that we watch closely through our risk committees is our investment portfolio and the investments in the oil sector. I'd say right now we have a little over $1 billion of direct investments in the oil-producing sector. We feel good about all the credits. There's been a little bit of a mark-to-market spread widening. We think oil, if it stabilizes in the $55-$60 barrel range, the industry will be able to cash flow all its debt payments and really not create any long-term impairments for us.
We also look broadly across all the energy sectors as well. I mean, that part of our portfolio is probably closer to $3.6 billion when you add all of it in. Roughly 5% of our total portfolio and our investment folks, they've basically underwritten each of those exposures. Feel very good about it. We lightened up a little bit, sold like $200 million, but that was it. For the most part, I think there's only about $300 million of it that's below investment grade. We feel really good about where we are right now with that portfolio.
Got it. Doug, I think you mentioned earlier a bit on workers' comp. Where does that fall today in terms of if you were to rank it relative to the rest of your portfolio on the P&C side in terms of rate adequacy, and how has that changed over the last few years? How do you calibrate rate adequacy in this context versus the avenues where you look to grow?
Right. I'd start by saying that as we look across our performance across essentially all our businesses with the scrubbing we've done over the last couple of years, we're looking to grow for offensive opportunities across all our markets right now. Secondly, when I think workers' comp, I first think small versus middle. I think those are two very different conversations, national could be a third, if you will. In our small commercial business, workers' comp is a big part of our product offering. It's been a very steady, solid, very rate adequate line for a long period of time, as long as I can go back and find, we have basically seen no change in that over the last couple of years.
It faced some of the challenges that the other lines faced a couple of years ago, but still in very good financial stead. I feel that way today. Relative to small commercial, we love what we're doing. Our lines are all very rate adequate, including comp, we're looking to grow that line going forward. In the middle, workers' comp line as a line has been the biggest turnaround for us in middle market. Three years ago, I would say that workers' comp was our line that was most challenged from a rate adequacy perspective. It was not rate adequate, actually not close. We've worked hard at that through both pricing, non-renewal, underwriting, et cetera, that line has gone from essentially the back of the pack to near the front. Today it's one of our more or most rate adequate lines in the middle.
We're looking at package opportunities, don't want to be just a monoline player, although we'll look at certain opportunities, really like how that progress has happened, it's been a complete flip, if you will, over the last three years.
Have you seen over that period of time as you've kind of moved from inadequate to rate adequate, especially here now recently, have you seen competitive forces start to lift up in that market? How do you perceive that sort of playing out from here?
We have seen increased competition, increased appetite for some of those lines, I would say generally across middle. We're not the only one that feels it. I think you would see that across our competitors. As I've said in our calls, and I would still say today, we think that the competition's been thoughtful, and that's a good thing. I think we're all mindful of all of the challenges all our lines face, including a yield curve that is very challenging today. As we look out to the fourth quarter, what I expect in the fourth quarter, and I'll say this, but December is still a big month in the quarter because November's kind of a small month, and October and December tell the quarterly tale.
I expect pricing to be a bit lower than it was in the third quarter, but I still see thoughtful competition, and I hope that remains the case as we move into 2015.
That's the case across the spectrum, so small, medium, large in terms of the comp?
Generally, yeah.
Okay. Maybe shifting just for a moment to group benefits. I mean, clearly employment has been a positive highlight in the macroeconomic picture here recently. What was your baseline in thinking about your group benefits business, I don't know, six months ago, nine months ago? How should we think about the more positive employment trends impacting your group business?
Let me start, and I'll have Chris come over the top. A healthy economy is good for our group benefit business, really all our businesses. That business also has gone through a pretty significant financial turnaround. Not only financial turnaround, but market turnaround. Chris and I spent three hours with that business yesterday, Not only did we think about closing up the fourth quarter, but because that business is so forward forecasting, we took a look inside 2015. A series of changes. We made some dramatic pricing changes over the last three years. Many of you know, probably all of you know, these are multi-year contracts for the most part. We made some underwriting changes. We made some changes in our own claim delivery, point of sale, underwriting, et cetera.
You put all that together, we will finish 2014 feeling much better about a much healthier book of business and excited about how we're going to hit the ground in 2015 with our group benefit business, with an economy that is, as you say, a bit more positive than certainly it's been over the last three years. Chris?
Yeah, I think you said it right, Doug. As you looked at 2014, the profit improvement, margin expansion, I would say in a less salesy environment, meaning that there was not a lot of new large opportunities. I think we see that shifting, particularly in the first quarter when we print results. Continuing into 2015 and 2016, we just think there is more opportunities. I am particularly excited about all the exchange activity. We are probably on 10 to 15 of the top private exchanges, and we see a lot of opportunities coming to market through exchanges. It is really just a business that we continue to believe in. We continue to see synergies with, particularly our workers' comp business. From an underwriting side, very similar from a claims side. We manage those claims together.
As we note, and I think other groups have heard me say that if distribution continues to think about P&C, workers' comp, group benefits together, we see a lot of opportunities with our distribution partners over a longer term to really cross-sell and get at the one key decision maker for both insurance and benefits long term.
Like the other thing we talked about yesterday, and we are very pleased with progress, is that we have been building on our product portfolio in group benefit the last 18 months. I would say up until 18 months ago, really exclusively in the disability and life space. We now are in the market with a new DisabilityFLEX product, which is a voluntary product. Critical illness is in the market for us effective April of 2014. Most recent, we came to market with an accident product. Very pleased with progress there. In fact, we spent some time talking about it. I think well received by some customers and anxious about getting on with 2015.
Last comment is that as we went through some difficult choices over the past three years with pricing and customers, given where the yield curve was, we lost some customers that had been with us for a while. What is neat is as we think about 2015, several of those customers are coming back to The Hartford. They want our service, they want our platform, and understand that the market is kind of probably thinking differently about pricing overall in terms of a longer-term moat, and we have been very successful in making that happen.
Great. Well, I have a few more. Are there any questions from the audience? I want to make sure if folks have questions, that you can ask. Here we go. Samir?
Good morning. I was hoping to get an update of your buyback activity quarter to date, if possible.
For quarter to date?
Yeah.
Yes. Through yesterday, we've repurchased approximately $244 million worth of shares for the fourth quarter.
Okay. Have you guys been conducting that by a 10b5-1 or open market purchases?
We typically put trading plans in place. That's how we've been executing this one.
Matt?
Last update was your carried reserves are roughly two and a half % more than actuarial indication. Where would you like that to go over time?
I think that was the last update in the 10-K, so we update it once a year. I would say that we've continued to feel very good about our reserve position and probably have built that up during 2014. It's hard to say from a precision side because we make our best estimates every quarter. It so happens that it provides us a cushion at this point in time or some excesses. There's sensitivities we manage too, particularly inflation, ultimate medical costs, increased incidences, latent reporting. There's a lot of factors that go into our best management estimates going forward. You ought to feel comfortable since we feel confident about the reserve position that we're going to start 2015 with.
Okay. I want to pick up from a point that you made earlier about just technology. We've talked about the technology investments on the commercial side and small commercial and leveraging some of those maybe into the middle market. Maybe we can shift over to the personal line side a bit and talk about investments that you're making there and how you see those sort of scaling over time.
I would say this about consumer. Ray Sprague and I are working with that team, and we've been working with that team extensively over the last five months. Most of our big investment right now in terms of on the floor is on the commercial side. We are doing some tuning inside personal lines consumer relative to some of their tools. We feel actually very good about some of the things we have on the street with our agents and brokers. Probably needs Well, right now, we're going through kind of a review of that, making sure we're doing all the things that we need to do for the next three to five years. I would say I'd be better prepared to answer that probably over the next couple of months as we finish those work products. I don't know, Chris.
I think you said it well.
Sticking to personal lines for a minute. As you look at that business, very steady, very kind of sticky demographic. What if any sort of changes do you perceive there? Or is the idea just kind of steady as she goes, continue to execute, and kind of maintain share in your target demographic?
Well, we have a terrific core of that personal lines franchise with our AARP business. To me, it starts there. It's well-priced, well-positioned, a number of initiatives right now underway to see if we can't grow that further, working with AARP as a group. Around AARP, we got a number of other businesses, obviously, our agency business is our largest. We've rolled out AARP for agents over the past 18 months and are seeing real progress there. Watching carefully there. There's no question there are some challenges in the industry agency channel overall, just the general channel that we're facing off against. Feeling good about progress. We rolled out a new class pricing plan earlier this year. We're staying very close watching that plan as it progresses. Six to eight months is not the ending view that we need.
I feel good about the changes we made and the adjustments inside our class mixes, if you will. Mike, we're going to watch that carefully over the next several quarters. That will allow us probably to do more. I know our agents and brokers would love us to be a broader player in personal lines. We hope to do that over time as well.
Great. We have time for one more if the audience has one. Otherwise, I'd like to thank Chris, Doug, and Beth for their time, and Beth especially for being such an excellent facilitator up front.
Yeah.
Thank you so much.
Awesome. Thank you. Thanks everybody.