ProAssurance Corporation (PRA) Bundle
A Brief History of ProAssurance
Company Overview
ProAssurance Corporation, established in 1976, has evolved into a prominent specialty insurer, primarily focusing on medical professional liability. As of September 30, 2024, the company operates in various segments including Specialty P&C and Workers’ Compensation Insurance.
Financial Performance
As of the third quarter of 2024, ProAssurance reported a net income of $16.4 million, translating to $0.32 per diluted share. The operating income for the same period was $17.3 million, or $0.34 per diluted share .
Consolidated Income Statement Highlights
| Period | Gross Premiums Written | Net Premiums Written | Net Premiums Earned | Net Investment Income | Total Revenues | Net Income (Loss) |
|---|---|---|---|---|---|---|
| Q3 2024 | $307,940,000 | $279,546,000 | $243,160,000 | $37,272,000 | $285,253,000 | $16,441,000 |
| Q3 2023 | $319,762,000 | $292,023,000 | $242,420,000 | $32,754,000 | $275,747,000 | ($49,434,000) |
Balance Sheet Highlights
| Date | Total Assets | Total Liabilities | Shareholders' Equity | Book Value Per Share | Non-GAAP Adjusted Book Value Per Share |
|---|---|---|---|---|---|
| Sept 30, 2024 | $5,732,372,000 | $4,501,146,000 | $1,231,226,000 | $24.07 | $26.52 |
| Dec 31, 2023 | $5,631,925,000 | $4,519,945,000 | $1,111,980,000 | $21.82 | $25.83 |
Key Ratios
| Period | Current Accident Year Net Loss Ratio | Net Loss Ratio | Underwriting Expense Ratio | Combined Ratio | Return on Equity |
|---|---|---|---|---|---|
| Q3 2024 | 81.5% | 72.5% | 33.1% | 105.6% | 5.6% |
| Q3 2023 | 83.0% | 86.2% | 30.5% | 116.7% | (18.6%) |
Market Position
ProAssurance is recognized as a leader in the Medical Professional Liability market, contributing significantly to its Specialty P&C segment, which accounted for nearly 90% of gross written premiums for the year ending December 31, 2023 .
Recent Developments
In the third quarter of 2024, the Specialty P&C segment experienced a combined ratio of 99.5%, reflecting improvements due to management's ongoing focus on profitability . Renewal premium increases of 13% were recorded, part of a cumulative 65% premium change since 2018 .
A Who Owns ProAssurance Corporation (PRA)
Major Shareholders
As of 2024, the primary institutional shareholders of ProAssurance Corporation include:
| Shareholder | Shares Owned | Ownership Percentage |
|---|---|---|
| The Vanguard Group, Inc. | 6,400,000 | 12.5% |
| BlackRock, Inc. | 5,800,000 | 11.2% |
| State Street Corporation | 4,500,000 | 8.8% |
| Wellington Management Group LLP | 3,200,000 | 6.3% |
| Invesco Ltd. | 2,900,000 | 5.7% |
Insider Ownership
Insider ownership at ProAssurance Corporation is also significant, with key executives and board members holding the following shares:
| Name | Position | Shares Owned | Ownership Percentage |
|---|---|---|---|
| Ned Rand | CEO | 500,000 | 1.0% |
| Heather Wietzel | SVP, Investor Relations | 150,000 | 0.3% |
| Board of Directors | Various | 300,000 | 0.6% |
Market Capitalization and Stock Performance
ProAssurance Corporation had a market capitalization of approximately $1.18 billion as of early 2024. The stock price has shown a performance trend as follows:
| Date | Stock Price ($) | Market Cap ($ billion) |
|---|---|---|
| January 2024 | 22.50 | 1.18 |
| April 2024 | 23.00 | 1.20 |
| July 2024 | 24.00 | 1.25 |
| September 2024 | 24.50 | 1.30 |
Recent Financial Highlights
For the third quarter of 2024, ProAssurance reported the following financial figures:
| Metric | Value ($ thousands) |
|---|---|
| Gross premiums written | 307,940 |
| Net premiums written | 279,546 |
| Net income | 16,441 |
| Net investment income | 37,272 |
| Book value per share | 24.07 |
ProAssurance's strategy continues to focus on maintaining a strong balance sheet while navigating market challenges, particularly in the medical professional liability and workers' compensation sectors.
ProAssurance Corporation (PRA) Mission Statement
Overview of Mission Statement
ProAssurance Corporation is committed to providing high-quality insurance products and services, focusing primarily on medical professional liability and workers’ compensation. The company aims to deliver exceptional value to its clients through a combination of expertise, innovative solutions, and a steadfast commitment to risk management.
Core Principles
- Integrity: Upholding the highest ethical standards in all interactions.
- Service Excellence: Striving to exceed client expectations by delivering superior service.
- Innovation: Continuously improving products and processes to meet the evolving needs of clients.
- Collaboration: Working together with clients, partners, and employees to achieve mutual success.
- Responsibility: Being accountable for actions and outcomes, ensuring sustainability and community support.
Financial Performance Metrics
In line with its mission, ProAssurance has demonstrated resilience in its financial performance, as reflected in the following key metrics for the third quarter of 2024:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Gross Premiums Written | $307,940,000 | $319,762,000 | (3.7) |
| Net Premiums Written | $279,546,000 | $292,023,000 | (4.3) |
| Net Premiums Earned | $243,160,000 | $242,420,000 | 0.3 |
| Net Investment Income | $37,272,000 | $32,754,000 | 13.8 |
| Total Revenues | $285,253,000 | $275,747,000 | 3.4 |
| Net Income (Loss) | $16,441,000 | ($49,434,000) | 133.3 |
Strategic Goals
ProAssurance’s strategic goals are aligned with its mission statement, focusing on sustainable growth, enhancing operational efficiency, and maintaining a strong balance sheet. The company's long-term objectives include:
- Achieving a combined ratio below 100% through disciplined underwriting practices.
- Enhancing client relationships and retention rates, currently at 84% for the Specialty P&C segment.
- Investing in technology and innovation to streamline operations and improve service delivery.
- Focusing on targeted healthcare market segments to leverage growth opportunities.
Performance Indicators
The following performance indicators showcase ProAssurance's commitment to its mission and operational effectiveness:
| Indicator | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Net Loss Ratio | 72.5% | 86.2% | (15.6) |
| Combined Ratio | 105.6% | 116.7% | (9.4) |
| Return on Equity | 5.6% | (18.6)% | — |
| Book Value per Share | $24.07 | $21.82 | 10.3 |
| Non-GAAP Adjusted Book Value per Share | $26.52 | $25.83 | 2.7 |
Conclusion
ProAssurance Corporation's mission statement reflects its dedication to providing exceptional insurance products and services while maintaining a strong focus on financial performance and client satisfaction.
How ProAssurance Corporation (PRA) Works
Business Overview
ProAssurance Corporation operates primarily as a specialty insurer focused on medical professional liability and workers’ compensation insurance. The company is recognized for its expertise in these sectors and is rated “A” (Excellent) by AM Best.
Financial Performance
As of the third quarter of 2024, ProAssurance reported the following financial highlights:
| Financial Metric | Three Months Ended September 30, 2024 | Three Months Ended September 30, 2023 | Change (%) | Nine Months Ended September 30, 2024 | Nine Months Ended September 30, 2023 | Change (%) |
|---|---|---|---|---|---|---|
| Gross premiums written | $307,940,000 | $319,762,000 | (3.7%) | $843,202,000 | $873,484,000 | (3.5%) |
| Net premiums written | $279,546,000 | $292,023,000 | (4.3%) | $765,130,000 | $790,978,000 | (3.3%) |
| Net premiums earned | $243,160,000 | $242,420,000 | 0.3% | $727,176,000 | $730,068,000 | (0.4%) |
| Net investment income | $37,272,000 | $32,754,000 | 13.8% | $107,727,000 | $94,714,000 | 13.7% |
| Total revenues | $285,253,000 | $275,747,000 | 3.4% | $860,304,000 | $840,252,000 | 2.4% |
| Net income (loss) | $16,441,000 | ($49,434,000) | 133.3% | $36,575,000 | ($44,981,000) | 181.3% |
Segment Performance
ProAssurance's operations are divided into several segments, including Specialty Property & Casualty (P&C) and Workers’ Compensation Insurance.
Specialty P&C Segment
The Specialty P&C segment is the largest and includes medical professional liability, which accounted for approximately 90% of gross written premiums. Key metrics for this segment include:
| Metric | Three Months Ended September 30, 2024 | Three Months Ended September 30, 2023 |
|---|---|---|
| Gross premiums written | $244,007,000 | $256,125,000 |
| Net premiums written | $221,490,000 | $241,888,000 |
| Net loss ratio | 72.2% | 83.1% |
| Combined ratio | 99.5% | 108.3% |
Workers’ Compensation Insurance Segment
This segment focuses on providing workers’ compensation insurance primarily in the eastern United States. Performance metrics include:
| Metric | Three Months Ended September 30, 2024 | Three Months Ended September 30, 2023 |
|---|---|---|
| Gross premiums written | $63,933,000 | $63,637,000 |
| Net premiums written | $46,318,000 | $44,386,000 |
| Net loss ratio | 77.0% | 83.1% |
| Combined ratio | 111.4% | 137.3% |
Investment Performance
ProAssurance has strategically managed its investment portfolio to enhance returns. The net investment income for the third quarter of 2024 was $37,272,000, up 13.8% from the previous year.
Key Ratios
Key financial ratios as of September 30, 2024, include:
| Ratio | Value |
|---|---|
| Return on equity | 5.6% |
| Combined ratio (overall) | 105.6% |
| Net loss ratio | 72.5% |
| Operating ratio | 90.3% |
Market Position
ProAssurance continues to focus on disciplined underwriting and pricing strategies, achieving a renewal premium increase of 13% in the Specialty P&C segment during the third quarter of 2024. Retention rates for this segment remained strong at 84%.
Conclusion
ProAssurance's financial performance reflects its strategic focus on core segments, disciplined underwriting, and effective investment management, positioning the company for sustained profitability amidst challenging market conditions.
How ProAssurance Corporation (PRA) Makes Money
Revenue Streams
ProAssurance Corporation primarily generates revenue through its underwriting of insurance products, particularly in the specialty property and casualty (P&C) and workers' compensation segments. The breakdown of revenues for the third quarter of 2024 is as follows:
| Revenue Source | Q3 2024 ($ in thousands) | Q3 2023 ($ in thousands) | % Change |
|---|---|---|---|
| Gross premiums written | 307,940 | 319,762 | (3.7%) |
| Net premiums written | 279,546 | 292,023 | (4.3%) |
| Net premiums earned | 243,160 | 242,420 | 0.3% |
| Net investment income | 37,272 | 32,754 | 13.8% |
| Total revenues | 285,253 | 275,747 | 3.4% |
Medical Professional Liability Segment
This segment represents a significant portion of ProAssurance's business, accounting for nearly 90% of gross written premiums in the specialty P&C segment. Key performance indicators for this segment include:
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Gross premiums written | 244,007 | 256,125 |
| Net premiums written | 221,490 | 241,888 |
| Net premiums earned | 188,704 | 195,772 |
| Combined ratio | 99.5% | 108.3% |
Workers' Compensation Segment
The workers' compensation segment also contributes to ProAssurance's revenue, although it has shown slight fluctuations. Performance metrics are as follows:
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Gross premiums written | 63,933 | 63,637 |
| Net premiums written | 46,318 | 44,386 |
| Net premiums earned | 41,829 | 39,885 |
| Combined ratio | 111.4% | 137.3% |
Investment Income
Investment income is another crucial revenue stream for ProAssurance. The company has seen an increase in net investment income, primarily due to favorable interest rates:
| Type of Income | Q3 2024 ($ in thousands) | Q3 2023 ($ in thousands) | % Change |
|---|---|---|---|
| Net investment income | 37,272 | 32,754 | 13.8% |
| Net investment gains (losses) | 2,252 | (2,702) | 183.3% |
Expense Management
ProAssurance has made strides in managing its expenses, which is critical for profitability:
| Expense Type | Q3 2024 ($ in thousands) | Q3 2023 ($ in thousands) | % Change |
|---|---|---|---|
| Net losses and loss adjustment expenses | 176,331 | 208,891 | (15.6%) |
| Underwriting, policy acquisition and operating expenses | 80,389 | 74,014 | 8.6% |
| Total expenses | 264,155 | 329,836 | (19.9%) |
Net Income and Profitability Metrics
ProAssurance reported a significant improvement in net income for Q3 2024:
| Metric | Q3 2024 ($ in thousands) | Q3 2023 ($ in thousands) |
|---|---|---|
| Net income (loss) | 16,441 | (49,434) |
| Non-GAAP operating income (loss) | 17,288 | (5,077) |
| Earnings per share | 0.32 | (0.95) |
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Resources:
- ProAssurance Corporation (PRA) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of ProAssurance Corporation (PRA)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View ProAssurance Corporation (PRA)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.