Thank you for coming to the conference this year. I'm Grace Carter. I cover Selective here at Bank of America, and today we have John Marchioni, the CEO, with us for a fireside chat. So we're going to go ahead and get started with the questions. So you've targeted an ROE of 12% for the past couple of years. Can you discuss the expected contribution from underwriting versus investment income? And last year, the ROE was well above the target, even though underwriting margins were a bit below the long-term expectation. Under what conditions would you feel comfortable increasing your ROE target?
Yep, great question. Thank you for the invite again. We always love to be at this conference, and I think we've been here for well over a couple of decades consecutively, so we appreciate the invite. First thing I'll say is, and you pointed to this, last year, despite a year of elevated CAT losses, we produced an operating ROE of 14.4%, which was our 10th consecutive year of double-digit operating ROEs and, in fact, averaged a little over 12% over the course of that decade. I think the first thing when we talk about ROE targets at Selective, these are not aspirational targets. These are targets we expect to hit on a consistent basis overall. We set our combined ratio target at a 95%.
In a year like 2023 and a year like 2024, where investment returns are running above their long-term average, that 95% will produce a higher ROE than a 12%, as we demonstrated last year. So our philosophy is you want your underwriting organization to have a very consistent view of what they need to be targeting from an underwriting margin perspective. Our guidance for 2024 is to produce a combined ratio of 95.5%, so just slightly above that 95% target. And when you think about where investment returns are, and if you looked at 2023, the investment ROE contribution was a little under 12.5 points, 12.4 points, and that assumes or is based on an after-tax return in the high 3% range and invested asset leverage of just a little bit over 3 times.
So that 12% ROE contribution is something that we would expect to continue for the near term. And we've talked about this. We picked up, since the start of the hiking cycle in early 2022, we added about a little over 170 basis points of embedded book yield. And that was done really through three means. Number one is just the organic cash flow from the investment portfolio and from operations, investing at higher yields. At the start of the cycle, we had about a 14% allocation to floating-rate securities, which were resetting higher. That's been worked down to about 7%. And then you've got the active turnover that we were able to manage over the last two years, and that really positioned us well with strong embedded book yields. So our philosophy is, because it's not an aspirational target, we expect to hit it consistently over time.
In a year like 2023 and a year like 2024, we expect to meaningfully outperform that 12% target. If you look at our guidance of a 95.5%, you could extrapolate that to somewhere in the range of a 14%-15% ROE. We like thinking about an ROE target and a combined ratio target over the long term, and we want to keep that consistent mindset and consistent philosophy in our organization.
Thank you. You briefly mentioned your combined ratio target for this year of 95.5%. If we could talk a bit more about that. That's modestly above the long-term target of 95%. As we think about the catastrophe load drifting upwards over time, do you expect the offset to come from a better attritional loss ratio or expense efficiencies? I guess you're still expecting improvement in 2024 over 2023, yet you've increased your expected loss cost trend. Could you speak to the drivers of the year-over-year improvement that you're anticipating?
Sure. So you hit on one of the big points, which is the expected CAT load of 5 points, which is sort of right in the middle of our 5-year and 10-year averages. So our 10-year average is about 4.7 points. Our 5-year average is about 5.4 points, so kind of right in that range. Now, that's down about 140 basis points over what we actually had in 2023, so that's important to think about from a year-over-year all-in combined ratio perspective. And then the underlying combined ratio assumed in that plan is a 90.5% with the 5-point CAT load, which is essentially also flat on a year-over-year basis. And I think the big drivers are, if you think about our core commercial lines business and our core E&S business, which combine for about 90% of our premium, they're running at or better than our target margins.
We've got rate level we've continued to earn rate level in line with our expected loss trend, but we did boost loss trend from 6.5 - 7, and the bigger move was on casualty from 6 points to 8 points in that 95.5% combined ratio guidance. That's sort of the bigger upward pressure point on a year-over-year basis. We also would expect expense ratio, and we've been running below that 32% target, to remain relatively flat year-over-year.
But again, I think the important point here is, and I'm sure we'll get into a discussion either from a question from you or a question from some of the folks that are here around reserves, but I think the increasing of loss trend and embedding a higher loss trend assumption in our casualty business is something that investors should look upon favorably because that's what we're booking to. And based on what we've been seeing over the last several years and that we've been boosting loss trends, we did it again in 2024, and that's fully incorporated into that 95.5% guidance. So there's a lot of moving pieces in there, but year-over-year, down a full point, but the underlying is pretty stable when you put all the pieces together.
Then with the final piece, I talked about commercial lines and E&S, personal lines, which is about 10% of the premium, running well above target, heavier cat and non-cat loss ratios, some adverse development. Our expectation, as you saw the ramp-up in pricing throughout 2023, we continue to believe that we'll have rate on a written basis in the 20%-25% range over in 2024. Despite a pretty healthy loss trend assumed going forward, that will, over time, put us on a pretty good glide path to bring that down to target over the next couple of years.
Thank you. You accurately predicted the next question on reserves. Following strengthening in certain lines in 2023, if you could just give us an overview of your reserving process and what data you think investors should be focusing on to get comfortable with reserves in such an uncertain loss environment? I guess just kind of a smaller last piece, how close are we to reaching the end of the pandemic-driven settlement backlog, just to alleviate a piece of that uncertainty?
Yeah, let me hit the last part first, then I'll come back and hit the deeper part relative to reserving in our process. I would say, for the most part, and there might be a few jurisdictions that had more vacancies on their benches in their states. I think, for the most part, the backlog that was experienced is largely worked through. But I think, and I believe I pointed this out on the earnings call, there has been a slower development pattern. Slower reporting patterns have emerged on casualty lines and elongated disposal patterns, which sort of correspond to higher litigation rates. We started to see that in the pandemic, and then it continued beyond the pandemic.
And that's also captured in how we think about forward loss trends because there has been more of a shift to slower reporting and longer disposal times in casualty lines, but that's fully incorporated into our loss trend assumptions. But I would say that's no longer a backlog issue per se. It's just a shift, social inflationary shift, that changed patterns from a reporting and a disposal perspective. Our reserving practice and approach and philosophy has been very consistent for decades now. And we do a full review of all major lines of business every quarter, and those are reviewed then by an outside Big Four accounting firm twice a year. But we do the full review internally every quarter, and we react to the data that we see. And I think there's two important considerations from an investor's perspective.
A, what's happening with reserves, but B, what's a company's approach to setting loss picks? Property is property, and you make a property loss ratio pick for your current year, and then those losses emerge right away. They either emerge better or worse than expected. There's different forces there. We saw what happened with economic inflation going higher and then a big pricing change, and those results come through right away. Casualty takes longer to develop, so you really want to understand what are companies looking at to book the current year loss pick for casualty lines of business. Our approach has been very consistent for a long period of time, which is we take the last five years, fully trend those for actual changes in frequency and severity, and then bring all of them to present rates. That becomes your starting point.
And then you roll that forward with your expectation for written rate in the upcoming year and your expectation for forward loss trends. And the loss trend assumption we put out there is a forward loss trend assumption. It's driven by what you see in your history in terms of frequency and severity patterns, but then you also roll forward how you think that's going to change going forward. That's incorporated into how we make our loss picks, and then we allow those loss picks to age an appropriate amount of time. If you see frequencies emerge unfavorably quickly, we're going to react to that quickly, as we've done in the last several years in Commercial Auto and Personal Auto in particular. If frequencies emerge favorably, you're generally going to allow those severities longer time to emerge.
I think understanding all of those pieces and how companies react and what their philosophy is over the long term is how investors should be thinking about it. We never plan for favorable development. We have a disciplined approach for setting our loss picks and evaluating actual claim counts and actual expected severities on a pretty consistent basis, and we react to the data that we see. You saw that happen in Q4, where we made some adjustments on GL. We also made some adjustments on a favorable basis in workers' comp. Net-net, it was a $10 million unfavorable quarter. The process has been very consistent.
Thank you. Switching to geographic expansion, given plans for further expansion in 2024, could we discuss your strategy and timeline for entering new states and how prevailing market conditions influence your thinking regarding when is the right time to enter new states and just any sort of top- and bottom-line impact that investors should expect from geographic expansion?
Yeah, so I would say, from a timing perspective, the current market environment doesn't really influence our decision around when to enter a state. We've got a fairly consistent and disciplined process around that. Our long-term strategy is to be a company that operates like a regional with very close relationships and local decision makers but have a near-national footprint. So think about capabilities of a national company but operating like a regional market, and the benefits there are twofold. Agents love that market, that operating model, because they have decision makers, empowered decision makers on the underwriting side in close proximity to them. We think it gives us significant underwriting advantage because we have underwriters who have local knowledge, not just of the producer in that agency who's submitting the application, but of the nuances of that local jurisdiction.
And then we think they make better underwriting decisions as a result of that. So we've been deliberate in taking that operating model and replicating it in new states. And we evaluate new states based on a number of different factors: economic growth, regulatory environment, litigation environment, and then our ability to actually come in and offer a different market than these agents currently have in those states and actually get a pretty big commitment from those agents. So we take our time. It takes us about 18 months from start to finish to launch a state. And we started with the expansion in the southwestern part of the country in 2017, and we've been adding states on a pretty consistent clip now. Every 18 months or so, we've been adding a couple of states.
This year, it's a little bit accelerated in that we've been working to open 5 new states. We'll open 2 in the first part of this year. That's West Virginia and Maine. And then in the latter half of the year, we'll be opening 3 states, which is Oregon, Washington, and Nevada. Now, the other important point is, for the most part, we open these states with a very similar underwriting philosophy and product portfolio that we have in our existing footprint. But there are jurisdictional nuances, and there are states that we're going to take a different approach with. So, for instance, if you look at how we opened the state of Alabama, we didn't go in and appoint a lot of agents. That growth was largely going to be driven. It was going to be northern Alabama-focused. It was going to be casualty-driven.
It was largely agents in surrounding states that had offices in that state and a few targeted appointments. Whereas in a state like Arizona or New Mexico, we went in and appointed agents like we always did, put field staff on the ground, and made those look fully operational, as we do in our current footprint. So over time, over the next several years, we'll continue to build at the pace we've been building and ultimately have a near-national footprint. There are a handful of states we don't intend on being big players in. I think it's the obvious ones from a catastrophe and a regulatory perspective, but we think that really gives us a lot of great runway in addition to the runway we have in our existing footprint, where we only have a point-and-a-half market share and a lot of upside.
The growth in the last couple of years, just the final part of your question. The growth we've experienced in the last couple of years, it's contributed about two points of our growth. The states we've opened since 2017 in the last couple of years have contributed about two points of growth. I think that can likely continue for a few years, but we're going to get to the point where the opportunity in the new states is going to start to drop off based on the available market. And then the profitability impacts are largely de minimis. We plan on running a new state at an underwriting loss for the first few years because you've got a new business penalty, and the percentage of your business that's new and unseasoned in those states for the first few years, obviously, is a lot higher.
We plan for that, but it's a de minimis impact on an overall basis, and it's all fully incorporated into our planning.
Thank you. I guess considering the markets where you're already operating, you've mentioned goals to appoint agents with 25% market share and reach 12% wallet share with those partners. Where do you currently stand relative to those goals, and does current market disruption provide any opportunities to accelerate share gains with your agent partners?
Yeah, I think everything we do from a growth perspective is always balanced in making sure we're achieving our profitability targets. So the agency market share and share of wallet targets were really designed to drive our operational execution on a state-by-state and agency-by-agency basis. Now, we're highly transparent, so when we have internal objectives that drive our operations, we tend to talk about those in our public disclosures. So that's what you're referring to, which is the 25% and 12% targets, which would get us to a 3% market share or about a $3 billion additional opportunity in standard commercial. Our current agency share across the entire commercial lines footprint is around 21%, some states well above that, some states still below that.
We've been adding on a net basis anywhere from 70-80 agencies a year on average, and that'll allow us to continue to build towards that 25%. The share of wallet is a number that takes a long time to move because you're constantly bringing on new agents. You're bringing on new states, so your starting point is downward pressure on that number, whereas your legacy agency group is a higher starting point. We're still in that 7% range. We have some agents that are in the 15% or 20% share. We have others that are in the low single digits. But I say those are operational metrics because, in our regional operating model and our field underwriting model, that's a great way for our field underwriter to plan with an agency. What is our current share?
Where do we have opportunities by class of business, by producer to get from wherever we are from a share perspective to what our longer-term target is? And then our regional management teams use that agency market share target to make strategic appointments and continue to build that. So we think it provides us a lot of really good runway, but it's really what we use to drive our operations.
Sounds good. Thank you. I just wanted to check and see if anyone in the audience has a question. All right, we can keep going. So distribution. How do recent developments in AI influence your thinking about distribution? Do you think that there's risk that some small commercial business migrates to the direct channel and out of the agency channel over time as the AI opportunity becomes more advanced? And I guess if you could speak about how you view the advantages of an agent-centric model over the direct channel.
Yeah, I'd also say I think the risk clearly exists. From a technology perspective, the risk exists. We firmly believe that independent agents will continue to control the majority of the markets that we operate in for the long term. That's not to suggest that around the edges and the really small, really homogeneous part of the small commercial market you could see migrate. But direct-to-consumer in our business is largely for commoditized products, commoditized products that are very homogeneous in the product makeup and where the risk presented is very consistent. That's not the kind of business we write. Our business is going to have different exposures. Our business tends to be more of that consultative buyer that really values the professional advice of an independent agent. Now, that said, I don't think we ignore the risk. I think there is certainly risk.
But if you look at personal lines, while personal auto has migrated significantly to direct-to-consumer models, personal homeowners have been a lot more slow to migrate. And I think part of that is customers recognize that the product they buy matters and that there is significant difference from one product to another in home, and the exposures they have and the amount of insurance they need to buy varies. And a lot of folks don't understand that and are still heavily dependent on a professional to give them advice. And I think that continues to be the fact for small commercial and for middle-market business. Now, all of that said, a lot of the foundational investments we've been making over the last two decades position us to move with customers if customers start to migrate into more direct-to-consumer channels.
So the investments we've made in customer experience, the investments we make in our agency-facing technology, which could easily become customer-facing technology, and the investments we've made in sophistication from automated underwriting and pricing all give us optionality. But customers haven't shown any desire to migrate to direct-to-consumer channels for commercial lines, and we don't necessarily see that in the near future. I think AI, from our perspective, does provide significant opportunities from an operational efficiency and a decision-making perspective. And that's an area we've been investing in and experimenting with, and I think there's a lot of potential there that could be a benefit for us down the road.
Great, thank you. We briefly touched on this earlier in the ROE question, but digging in a bit deeper on investment income. So obviously, investment income has recently benefited from the higher interest rate environment, and the guidance for 2024 anticipates further growth this year. Can you discuss the macro assumptions that are underpinning your guidance for this year and how the prevailing interest rate environment informs your asset allocation?
I would say, from our perspective, we've got a fairly consistent philosophy around portfolio allocation in the investment side of the business. We tend, and we certainly right now believe, that an up-in-quality bias makes a lot of sense. When you could put money to work in investment-grade fixed income for a pretax yield of 5.5%-6%, that's where you want to be. Generally speaking, we target risk asset allocation in the 10%-14% range. Right now, we're right around that 10% lower end of that range, and I think that'll continue to be our philosophy for the near term. But we're going to be a conservative investor. Our investment operation is there to support our underwriting business, and I don't see any meaningful change there.
But I think when you look at the steps we've taken to actively move that portfolio to maximize the embedded book yield and maintain an up-in-quality bias, we think that's the right place for us to be. So I don't really see a significant change there, but I think our ability to lock in that embedded yield for a longer term is a positive. But this also ties back to not looking at that 12% ROE contribution from investments and assuming that that's always going to be there.
That's why anchoring to that 95% underwriting margin, 95% combined ratio, is so important because you don't want to deliver a message to your underwriting organization that it's okay to manage to a 98% or a 99% combined ratio because when you have to reverse that as rates come down and, therefore, your embedded yield starts to come under pressure, it's very hard to turn that dial up and down. So I think that consistency is something that we really strive for.
Perfect, thank you. You've mentioned that organic growth is the most attractive capital deployment opportunity. Could you discuss your capital management strategy and how you view the balance between returning capital to shareholders and deploying the capital towards growth?
Yeah, I think, and we've said this consistently, and I think our margins, our underwriting margins, and our rate of growth over the last decade kind of support this, which is we think the best use of our capital is to support growth in our business, and that's exactly what we've been doing. Now, we've had a consistent philosophy from a dividend payout ratio of around 20%-25% of earnings, and we had a nice boost to our dividend in 2023, and that's been a pretty consistent track record. So we'll continue to increase the dividend as our earnings support that. And to the extent we wind up in a situation where margins come under pressure or growth isn't as strong, we would consider options for returning capital. We have an ongoing authorization for share repurchase on an opportunistic basis. There's about $84 million remaining on that.
But again, we think with what we have in front of us from a growth potential perspective, at the margins we're producing, that continues to be the best source of deploying the capital that we have.
Perfect, thank you. I guess moving to reinsurance. Could we discuss your philosophy for catastrophe management and the extent to which the pricing and availability of reinsurance influences your willingness to grow in CAT-heavy lines?
Yeah, so now, from an underwriting perspective, I think we've always done a really good job of managing our catastrophe exposure. So reinsurance is one piece of the recipe around managing your CAT exposure, but what you do from an underwriting and a pricing perspective and what you do from a spread-of-risk perspective is also important. That's also one of the big drivers of our geographic expansion initiatives over the last several years is to create more geodiversification to manage our catastrophe exposure. But let's get to the reinsurance point. So if you look at where we were, we had increased our retention from $40 million-$60 million in early 2023. But in reality, because we took half of that first layer, we didn't place half of that first layer. It was effectively an $80 million retention for a significant loss.
We raised that to $100 million at the 1/1/2024 renewal. That $100 million attachment point is about a 1 in 7 return period. And generally speaking, if you look at where reinsurers like to play on that first layer, it's 1 in 10. So we're still a little bit below that in terms of where the broad market is. And then we were able to buy additional capacity at the top of the program because our biggest constraint that we impose from a risk perspective is in a 1 in 250 PML event, which for us is East Coast Hurricane, we don't want to expose more than 10% of GAAP equity in a 250-year event based on the placement of the 2024 treaty because we fully placed it. So we increased the limit attachment to $100 million but fully placed the entirety of the program, so there's no co-participations.
A 250 PML event is a 4% impact to equity, which we think is a really strong place for us to be. Now, the other dynamic is we saw an opportunity to enter the CAT bond market, which we did also in the fourth quarter, and were able to place a $325 million bond, which is essentially about two-thirds of our top layer. So that 500 excess 700 layer, the majority of that is now occupied by that CAT bond, which gives us good collateralized reinsurance protection on a multi-year basis and gave us a really good position going into the 1/1 renewal. So we'll continue to be strong buyers. We're a relationship buyer on our property CAT reinsurer. We've got a lot of long-term partners who have benefited from being part of our CAT treaty.
We'll continue to have a pretty similar philosophy around reinsurance purchasing and, therefore, a similar philosophy around underwriting appetite.
Thank you. I wanted to give another chance to see if anyone else would like to ask a question. No? Okay.
Your questions are so good, they don't need to ask questions.
Quiet group today. I guess if we could look at E&S and Personal Lines, any cross-selling opportunities with the standard commercial book and just how you see your business mix evolving over time?
Sure, so as you said, standard commercial, just under 80% of our business. We're talking about the two other segments. So E&S, which we've been in now for about a dozen years and has shown us significant growth and really strong margins in the last couple of years, and the pricing dynamics in that market continue to be very healthy. And we produced an 86% combined ratio. We've said since we got into that business that we would target somewhere in the 10%-15% range of the overall entity. And we're a little over 10%, about 11% now. And I would still think that that 15% is a pretty good longer-term target.
But if we get there or we approach that and we continue to be comfortable with the margins and the opportunity, we would push that higher and could see that becoming a bigger portion of the organization because it allows us to leverage a lot of the skills and capabilities we have from an underwriting and pricing perspective in our Standard Commercial business. So we could put those same skills to work in that marketplace and have a lot of success growing it. Personal Lines is also more of a complementary business. I think there are definitely cross-sell opportunities between Standard Commercial, small business owners, and Personal Lines. And a lot of this is about our transition from primarily mass-market Personal Lines to mass-affluent Personal Lines. We've been going through that transition for the last two years or so.
But our near-term focus is on getting the profit margins in personal lines to where they need to be. Obviously, the industry's had a lot of pain there. We were a little bit slower to react from a pricing perspective because we were still working through the transition and filing all of our updated pricing plans for the affluent market business. It's going to take us some time to achieve that profitability target, but we still think that's a good business for us to be in. When you think about how agents view us as a very stable market with a very good product portfolio and a very good service experience, that's the sort of business our agents tend to write.
We think we give them a good home for that business, and we think long-term, that'll be a nice complement but probably still in that 10%-15% range. So long-term, standard commercial lines is still going to be the fuel to our economic engine, but we think both of those other segments are good complements and provide some good balance from a diversification perspective.
Thank you. So people often compare Selective with other regional peers, and I just wanted to touch on whether or not you agree with the regional label. Typically, when you go to market, who is it that you're competing with? Is it the other competitors that are considered regional as well, or is it large national players? Is it the smaller end? Just how do you see the competitive landscape across the different segments?
Yeah, it's all of the above. We compete against a broad array of markets. So it's certainly other regional players, and there are very few public regional peers anymore. But certainly, we compete against those companies. We compete against the large national standard market players on a consistent basis. But there's also a significant portion of our competition, as there is for everybody else on the public company side, that are mutuals. And that's a big competitor set, and it varies from different parts of the country. You've got a couple that play on a national basis but a number that play on a regional basis. In terms of the label, I don't really put a lot of stock in that. I guess the way I would describe us is we operate like a regional, and we have the capabilities of a national.
We pride ourselves in having the information assets and the level of sophistication from an underwriting, pricing, and claims adjudication perspective of any of our larger peers. But I think the value of a regional operating model cannot be undersold. And I mentioned this earlier. In our ability, and part of why we're comfortable doing this is because we have such good usable information and analytics, is we could push decision-making as close to our distribution partners and our customers as possible because we have the confidence in that we can measure the outcome of their decisions that they're making and executing that responsibility. So what makes us so unique is the fact that we do have the national capabilities, national company capabilities, but we deliver it through a regional, local operating model. And I think that's how I would describe us.
I'm not even sure I understand what a regional means anymore. But we'll be 35 states for standard commercial at the end of this year and growing, but we still operate like a regional, and there's a lot of benefits to that.
Do you find your local operating model to be kind of equally beneficial in the admitted and non-admitted markets, or do you see any sort of different dynamics in how it applies?
I think that's more of an admitted market dynamic. The consolidation that's happened in the distribution channel for retail has actually happened even more acutely in wholesale. And our E&S product is distributed through wholesale relationships. It's certainly a relationship model, but we operate in a more centralized manner from an E&S perspective. We have regions across the country, but our underwriting decision-makers are more centralized than E&S. And again, not to say that relationships don't matter in that business. I think they do, but it's a different operating model for E&S and Personal Lines where the underwriting is more centralized than it is for Standard Commercial Lines where it's more decentralized.
Thank you. So I guess sticking with commercial lines margins, you mentioned that Standard Commercial and Excess and Surplus have been performing quite favorably here lately. I guess I'm curious if you consider the margins to be currently at or near peak levels, and at what point in the cycle you kind of view them reaching the peak, if it's not right now. And as we go forward and we think about reaching the 95% combined ratio goal over time, do you see any deterioration in those margins offsetting improvement that's expected in Personal Lines?
So we want to run all three of our business segments at or better than target margins. We're there for commercial. So in Standard Commercial Lines, we were at a 94.9% last year and had a little bit of elevated CAT losses. We've bumped up the loss trend assumption in our 2024 guidance, so we want to make sure that rate continues to keep up with that. And then there's some balancing between lines. So Commercial Auto's still a little bit above target, Commercial Property a little bit above target, Workers' Compensation is below target, and General Liability, despite some adverse development, is still running, call it a 90%, roughly a 90% on an accident-year basis. So you want to get all of your lines as close to a risk-adjusted target as possible.
Our approach is always striking the right balance between profitability and growth, and we think that's an important balance for us to maintain. This is not about maximizing margins or maximizing growth. We're always looking at both in balance. And I think we've got a really good runway of growth potential in our standard commercial at or better than the current margins we're operating in that business. And I would say the same thing for the E&S business, which at 86% is obviously producing higher than target margins. Personal lines is the big opportunity from a margin perspective, but we would never say, as we expect to see improvement in personal lines, we're willing to give some of that margin back. In standard commercial, we run all three of those businesses at or better than the margin targets. And I believe I said this on the Q4 earnings call.
We think the pricing environment in standard commercial remains constructive. You might see some movement by line. You might see commercial auto, which has been running very strong for several years now, you might see that temper a little bit. It was just under 10% for us, pure rate, in 2023. You might see that temper, and you might see standard lines GL go a little bit higher based on some of the emergence that a lot of companies have seen in recent years. That line hasn't been as firm from a pricing perspective. We were about 5.5% rate in that line in 2023, and I think there's an opportunity for that rate level to go higher next year or this year.
Thank you. So we're getting pretty close to time. I wanted to give one last chance in case anyone has a question. No? Okay, well, very shy group today. So I think that we can wrap it up there then. And thank you so much for participating in the conference this year. We really appreciate it. It's been very interesting chatting with you today.
Thank you, Grace.