Welcome to the Everest Re Group Second Quarter 2022 Results Conference Call. [Operator Instructions]. Please note, this event is being recorded. I'd now like to turn the conference over to Matt Rohrmann, Senior Vice President, Head of Investor Relations. Please go ahead.

Good morning, everyone, and welcome to the Everest Re Group Limited second quarter of 2022 earnings conference call. The Everest executives leading today's call are Juan Andrade, President and CEO; Mark Kociancic, Executive Vice President and CFO. We're also joined today by other members of the Everest Management team. Before we begin, I'll preface the comments on today's call by noting that Everest SEC filings include extensive disclosures with respect to forward-looking statements. Management comments regarding estimates, projections and similar are subject to the risks, uncertainties and assumptions as noted in these filings. Management may also refer to certain non-GAAP financial measures. These items are reconciled in our earnings release and financial supplement. With that, I'll now turn the call over to Juan.

Thank you, Matt, and welcome to Everest. We're excited to have you on board. And good morning, everyone. Thank you for joining us today. Everest delivered strong results in the second quarter with positive momentum across our key objectives. We expanded margins in both of our underwriting businesses, and our insurance segment delivered another standout performance. We further scale our platform with strong overall and underlying results, continuing the positive trajectory for this business. In reinsurance, we seized opportunities to improve the diversification and profitability of our book, while reducing volatility. In a complex environment, Everest's global talent, disciplined underwriting and market leadership provide strength and stability to our customers. Our relevance and impact have never been more important. Improvements in underwriting profitability and operational efficiency, supported by our investment portfolio, delivered $386 million in net operating income and a 15.3% annualized operating ROE. We achieved these results through consistent and relentless execution of the strategy that was articulated at our Investor Day last June. Our strategy is to profitably scale our insurance platform and capitalize on our reinsurance leadership position to continue building a broadly diversified and consistently profitable company that provides leading returns in the sector. Our results quarter after quarter demonstrate we're accomplishing what we set out to do. Operational excellence is also a core component of our strategy. Efficiencies resulting from investments in our systems and technology make us more resilient, so we can respond nimbly to changing market conditions and cease emerging opportunities. Coupled with our ability to attract and retain great talent, this gives Everest a competitive advantage. This is increasingly important against the backdrop of macro volatility, achieving ambitious growth in profit today requires companies to operate with both the strong offense and defense. Our second quarter financial results demonstrates ever stability to…

Thank you, Juan, and good morning, everyone. Everest had another solid quarter, rounding out a strong start in the first half of 2022. The company reported operating income of $386 million or $9.79 per diluted share in the quarter. The operating ROE was 15.3% for the quarter, while total shareholder return, or TSR, was 6.6% year-to-date. We improved our attritional loss ratios in both segments, while generating double-digit growth in constant dollars as pricing and terms remain attractive in virtually all of our core lines of business. Based on the fundamental performance of the business year-to-date, our team continues to execute well, and we remain on track to achieve on the goals we set out in our strategic plan despite macro volatility. Looking at the group results for the second quarter of 2022, Everest reported gross written premium of $3.4 billion, representing 8.1% growth year-over-year or 10.3% growth in constant dollars. The combined ratio was 91.8%, which includes 2.9 points of losses from natural catastrophes and 1.5 points from the Russia-Ukraine war. While significant uncertainty remains around the Russia, Ukraine war, we felt it prudent to put up a provision, which is all IBNR, given the lack of claims to date and the ongoing nature of the event. The provision was driven by our marine, political risk and trade credit books in the Reinsurance segment. There is no direct exposure in our Insurance segment. The group attritional loss ratio was 59.8%, a 50 basis point improvement over the prior year's quarter, led primarily by the Insurance segment, which I'll discuss in more detail in just a moment. The group's commission ratio improved 20 basis points, 21.6% on mix changes, while the group expense ratio, which remains a competitive advantage for Everest, was 5.8%. Moving to the segment results and starting…

Thanks, Mark. Operator, we're now ready to open the line for questions. [Operator Instructions].

[Operator Instructions]. Our first question comes from Yaron Kinar from Jefferies.

First question, just looking at the reported combined ratio in the first half. I think it's tracking a little below the midpoint of the 91% and 93% guidance range. That said, I do think that the second half of the year tends to have a little more catastrophe losses in it. So how confident are you in achieving that 91% to 93% target?

Yaron, this is Juan Andrade. Look, I think we feel very confident about it. And the reason I say that primarily it's really all the reductions we have done in our property catastrophe book, right? If you look at our comments that we have been making consistently, we have been managing the volatility down, particularly in the reinsurance book in a pretty significant way. If you look at our investor presentation, you see our trading range and where we are now compared to where we were in 2017, '18, '19, even '21 and '20. So I think that part of it is a big help. If I think about the insurance division as well, as you heard in my prepared remarks, we have already taken down our gross PML in the Southeast by about 36% in the first half of the year. And so those steps, I think, are critical, frankly, to us being able to achieve that 91% to 93%. But I would invite maybe Mark to add any additional comments to that as well.

Yes. So in addition -- Yaron, in addition to the PML reductions that we've seen on the cat side, I think we're making some solid progress on the attritional loss ratios as well. And you can see that evidenced over the last several years, 5 years in particular when you look at insurance on a stand-alone basis. And so we don't see that changing. We feel like we've got a lot of momentum, good process, a lot of opportunity in the market, and we feel good about it.

Understood. And then my second question, also a guidance-related question. So I think your premium CAGR targets, 3-year targets, are for 8% to 12% growth in reinsurance, 18% to 22% in insurance. I think you were a bit ahead of target in '21, a little below target now in '22, so -- particularly in reinsurance. So with that in mind, how confident are you in those 3-year targets, especially as there is growing concern around a recession?

Yes. They're not targets. They are assumptions rather that we had in place for the 3-year plan. So in other words, to achieve the plan itself, it's not like we have to grow at that level. We're very much focused on total shareholder return profitability target for the group. To your point, when you look at the assumptions that we had 8% to 12% for reinsurance and 18% to 22% on insurance, last year, we exceeded those by a significant margin, pretty close to 25 points of growth last year for both divisions. This year, insurance is, within its 18% to 22%, I think we'll get there. The reinsurance side is a little bit lower, but that's not a problem for us. We've done a lot of things there, which I'm sure Jim will articulate as we go on through the call, but we can certainly achieve our objectives even if premium growth is somewhat muted because we're very much focused on profitability.

Understood. And maybe just one clarification there. The assumptions you were using were those on constant currency? Or is those absolute?

Well, yes, those would be constant currency.

The next question comes from Elyse Greenspan from Wells Fargo.

My question is on the capital side of things. You guys mentioned that you have ample capital. We didn't see any buybacks in the quarter. So just hoping to just get an update on how you guys are balancing using your capital for organic, inorganic growth as well as capital return from here?

Elyse, it's Mark. Let me take that one. So share buyback, you're right. We didn't have anything in the second quarter. It's still very much an option for us. I think I put in my monologue, to your point, the ample capital to support the business. So we have, as I said, ample capital, we still think that there's a lot of attractive opportunities in the market to grow. You're seeing a very nice growth in the insurance space, which we expect to continue significantly, especially on the international side. And so that's where opportunities for us really present themselves in an attractive way. If there is a point in time where we feel the buybacks are -- provide that much more value in addition to balancing our franchise development, we'll execute them. There's no issue on our side for that.

And then my follow-up is a margin question, but a little bit of a different way, right? You guys laid out a 91% to 93% combined ratio target at your Investor Day. That included right around at the midpoint, right, a 6.5 point cat load. So I back that out, right, that would be an underlying of 84.5% to 86.5%. You guys were 87.3% ex-Russia, Ukraine through the first half of this year. And you did mention some things like mix, right? If you're shifting away from property, right, that would perhaps lift your underlying, and we're also dealing with higher inflation trends and when you put this guidance in effect. So can you just walk through the drivers of kind of hitting the mid-80s from an underlying combined ratio perspective that's included within that 3-year plan?

Yes. So there's multiple components here to your point. So you've got everything from the attritional loss ratio, acquisition ratio, the cat load itself. And I think back in February for the Q4 results, we made a remark that the cat load of 6% to 7% that we had in the Investor Day presentation last June was likely to trend down as we start to reduce our PMLs on the cat side. So that number, I think, is firmly less than 6% in our anticipation for '22 and probably for the foreseeable future. So that's going to provide some relief within that 91% to 93%, but you're also seeing a couple of other things. On the mix of business, you're seeing a shift. On the reinsurance side, for example, from a 60-40 property, casualty ratio in the book is something that's closer to a 50-50. And so that has its own dynamics in terms of the prospective attritional loss impact overall. When you take into account the mix of business, and then the types of treaties were underwriting and the focus on profitably, we feel very good about the 91%, 93% range, even though we have some meaningful changes here, both in the level of expected cat and the proportion of longer-tail business. So we're comfortably in that 91% to 93%.

The next question comes from Meyer Shields from KBW.

Two quick questions. One, in your introductory comments, you talked about growing in international casualty. And I was hoping you could update us on social inflation internationally, both whether or how it's trending and how it compares to domestic social inflation?

Yes. Thanks, Meyer. And that comment was specifically related to the Reinsurance segment of our business, where we continue to see pretty significant opportunity. And as I said in my prepared remarks, what we're doing is very consistent with our prior strategy of partnering with specific seasons that we understand, that we know and that we also see getting rate in excess of loss trend. So from that perspective, we're pretty confident about that book of business. With regard to the social inflation question, I think that's more of a U.S. litigation issue than it is outside of the U.S., even in developed markets of Europe. So when we think about that particular driver of loss in the book, we tend to think about it more from a North America standpoint that we tend to think about it from an international standpoint.

Okay. No, that's good news. The second question -- sorry, let me try that again. You mentioned, I think, that ceding commissions for the Reinsurance segments are leveling off, and Mark noted ceding commission is actually helping to some extent the insurance acquisition expense ratio. Should we expect that benefit in insurance to level off? Or can we see different dynamics in these 2 segments?

Yes. So maybe a broad comment on that, and then I'll ask my colleagues to jump in as well. So I think on the comment about the market appearing to settle down on cedes. I think that is right. And I think that is what we saw during the quarter, primarily as our cedents are thinking about the same things that we're all thinking about, the risk environment, inflation, et cetera, et cetera. So from that perspective, we see the discipline that's going on with the primary companies, and we definitely see less of an uptick, if you will, on cede commissions. With regard to the insurance, I think that's largely a function of mix and where we saw the growth come in, in the quarter. I think you will see some fluctuations quarter-to-quarter, but we happen to see some very good growth in particular lines of business where we do get decent cede commissions from that, and that's really where you saw the offset. That's also been a little bit of a trend. If you look at the last 2 or 3 quarters, we've also been benefiting from that essentially. And that's part of our portfolio management to essentially drive our lines of business within the primary insurance business to areas where we think we can get better profitability. But let me ask maybe Jim Williamson to add a little bit of color on what he's seeing in the market from a cede commission standpoint.

Sure. Yes, Meyer, this is Jim. Look, I think one of the comments that Juan made, obviously, that you're picking up on is this idea that ceding commissions are starting in the process of leveling off. We certainly saw that in the U.S. and some of our international treaty casualty businesses, pro rata ceding commissions are beginning to level, and that's certainly a very good thing for us. But I would say that, that's a broad comment. When you get under the covers of that, there are clearly still areas of the market where ceding commissions are increasing. And so the mix component, particularly when you relate it back to what you expect out of our insurance business is going to be very important. The other thing that is critical, and it's something that I commented on last quarter is, this also varies deal by deal. And there's no question that there are still cedents who are achieving some increases in those commissions. Oftentimes, that makes sense on the reinsurance side for us, and we'll write it. Sometimes it doesn't and we won't write it. But I think that's also a factor you have to keep in mind when looking at the trajectory in our Insurance division.

The next question comes from Josh Shanker from Bank of America.

Yes. And [Indiscernible] little bit probably misrepresenting things. If we go back to the last few years, obviously, the marketplace and you have decided that property re is less attractive and property cat is less attractive than it used to be. But it's gotten to the point where it seems like a number of your competitors are pulling out, making an opportunity. At the same time in your prepared remarks, you spoke about moving away from frequency risk. And I don't want to give away the secret sauce. But where do you get paid in property cat effectively? And what has to happen for this market to be attractive again instead of the market where largely you're cautious about putting capital to work?

Yes. Thanks, Josh. And I think you broke up a little bit, so let me make sure that I answered the question that you're asking, if I -- this is one, by the way. Look, I think if you go back to the strategy that we have been articulating, a big part of that is really sustainability of earnings going forward. And a big component for us to be able to accomplish that is really to reduce the volatility in our earnings, which basically has come from property cat and the impacts of climate change and the storms that have been out there basically since 2017. And as you heard from my prepared remarks this morning, they certainly haven't abated, right? I mean whether you believe Munich Re's number of $34 billion or Aon's at $39 billion, it's still been a pretty active first half of the year. And then if you look at our cat losses for the first half of the year, and they're certainly underweight based on our market share and what we've been able to accomplish. So that part of it, we feel pretty good about the execution of the strategy. The other thing that I said in my prepared remarks is that we're basically getting much better pricing, much better risk-adjusted returns for total exposure -- for less exposure in total, right? And I think that becomes pretty relevant to us. The other point that I would make, Josh, is we have articulated a trading range that we feel very good about for property cat, thinking about earnings at risk and capital at risk. And our objective is to trade within that range. As we trade within that range, we're also looking at the environment that's out there for us, and we're positioning our book to be further away from lost higher layers. Given the shortage of capacity that's out there in the market, we're actually getting a pretty good rate online on those layers that are further away from loss. So for us, that's been a very good economic trade. But let me ask Jim Williamson to add a little bit more color on that for you.

Yes. Josh, thanks for the question. It's Jim. In terms of the first part of your question on where we think we get paid, that is a little bit of the secret sauce, as you say, but to give you some broad comments and echoing a little bit of what Juan said, I think at the lower end of a lot of programs, what we saw is the impact of climate change, in particular, is just creating a frequency of smaller cat losses that make those, in our view, very unattractive risk to be taking. And so we've, for the most part, moved away completely from what we consider more frequency layers, call it, 1 and 3, 1 and 4 attachment type point. And then at the very top of programs, that's where there's obviously significant capital market competition as well as the opportunity for real excess volatility, particularly if you start looking at things like aggregate structures, et cetera. So it's really between those 2 points where we see excellent opportunities that we've been able to [secure on]. And in some cases, that includes growing with our core clients. And then to the second part of your question on what needs to happen for our approach to change. Juan obviously laid out the idea that we've articulated the trading arrangement that we're comfortable with for the long term. That's very important. We are in a very targeted way given the hardening that we've seen in the market, deploying additional capacity with our best clients. But again, that's very targeted. I would say that in many places in our portfolio, we're perfectly happy getting paid more for the same or, in many cases, less risk, and I think that's very accretive, and that's been a major strategy. But then the last thing I would just sort of remind us all about is the idea that the reason the market is hardening is because people are being very thoughtful about deploying capacity. And so when we get asked the question of, well, why not deploy more capacity into what is a really good market? You just have to remember, the reason the market is really good is because people are not deploying a lot more capacity into it. And so we're thoughtful about that dynamic.

And this is going to be a bit of a [pendency] question, I guess. But I mean 2006 is too much to ask for. But if pricing were at where it was in 2010, 2011, does that kind of market give you any incentives to reembrace volatility?

Yes. Josh, it's Jim again. I'll just reiterate what we said, which is in a situation like that, we have articulated a trading range of volatility that we're willing to accept on an earnings at risk and a capital risk position. But that's a long-term strategy we're pursuing. We don't plan to change it. And the other thing I would say is in a situation, the more dislocated property rates become, the more I'm getting paid for the exposure I'm already taking. That's more margin. And in many cases, and we've seen this in the more recent renewals, where we've taken capacity off the table, but total renewed premium increase. So not only are you getting more margin, you're getting more total premium for less exposure. We really like that trade.

And I would build on that a little bit, Josh, by saying that if you go back and look at the trading range that we've put out there, there's flexibility in there, right, to the comments that both Jim and I just made. We have capacity, we have the dry powder. And it's just a question of the trade, right? If it's attractive for us on a deal-by-deal basis, we can deploy capacity. And as Jim said, we have for specific risks, but we will stay within that trading range. The key strategy for us is a broadly diversified company that can deliver sustainable earnings, right? And I think we got to keep that in mind and that's really what we're executing against.

The next question comes from Brian Meredith from UBS.

A couple of me for you. First, one, I'm just curious, maybe get some updates on you with respect to your loss trend assumptions, obviously, a company that you're pretty familiar with increased your loss trend assumptions. And on that topic, too, if you've got a 7.1% rate, I know you said there are some other things that are happening here. What's your cushion right now rate versus where you think trend is running right now or could potentially be here soon?

Yes, Brian, let me give you my thoughts on all of that. And look, I think first, it's important to remember that we have been consistently prudent in our loss pick selection process. And I think that's important to remember. As I've said in prior quarters, really starting in 2020, we deliberately strengthened our current accident year loss picks to reflect the heightened risk environment that we've been operating in. But the other important point is that we've also been consistently achieving pricing in excess of the assumptions that we built into those loss picks. And we haven't lowered our loss picks as we've talked about in prior calls. So we're thoughtful about the environment, and we're thoughtful about how we manage through it. And frankly, this has been a prudent choice, and I'm glad we did it. In addition, if you think about back to the end of 2019, we have been watching and increasing, our loss trend assumptions also in reaction to supply chain disruptions, social inflation, general material inflation, and we responded very quickly to those signals. And those changes drive our pricing and our underwriting decisions. So this is something that we started early in '20, '21, '22, and we have a process where we very frequently throughout the year, revised those loss cost assumptions. But despite the increase in those loss trend assumptions that I just articulated, our pricing performance continues to outpace that. And that's the case for both written and earned pricing, but it's also important to note that new business pricing also remains stronger than what we articulated for renewal pricing. So all of these things are important to keep in mind. The other thing is that it's important to note the growth in exposures that's resulting from inflation, right, especially when…

Great. And then Mark, I'm just curious, looking at the investment portfolio, obviously, a big increase in fixed income investment income this quarter. How much of that kind of increase that we saw in the yield, do you think is directly related to the [VII] ? And can we expect a continued kind of big increases in your investment yields here?

Well, it's difficult to say what the pace is. But clearly, we've got a tailwind behind us. And there's, I think, several factors pushing it higher. So we've got a new money yield that's well into the 4s in the portfolio. Roughly $3 billion of our fixed income portfolio is converting to cash through maturities and interest coupons over the next 12 months. And then you've got a run rate on operating cash flow, which is a little over $3 billion a year, annualized 12 months, I guess. So if you take those factors into account, that's going to provide some sense on what the yield pickup is going forward. I think we also have some ability to extend duration as well and pick up a few points on that. So I see still a good trajectory on that. What's unclear is just how persistent the current rate environment is going to be.

Makes sense. One, I'm just curious, going back to my last question I was going to ask you. Are you willing to give us what you think trend is running right now?

Look, we don't really disclose our -- how we price. What I've articulated in the past, it's running mid to slightly above mid-single digits.

The next question comes from Mike ops from Morgan Stanley.

First question, look, you guys aren't the only company that's talking about reduced volatility and kind of trimming back on property cat and you're growing nicely in reinsurance on the casualty side. I guess, especially in light of Juan, your earlier comments and a pretty common comments on social inflation and Juan, you even said emerging risk. Can you just help us think about how -- what specific steps you're taking in reinsurance casualty to kind of mitigate any surprises on the negative side there? I don't think pricing is what we hear on the property cat side, on the casualty side and reinsurance and more risk there. So just help us think about how -- what you're doing specifically mitigating risk in the near term for that business?

Yes, Mike, this is Jim Williamson. I'll really break that down into 2 things. The first is what our cedents are doing. And then the second is maybe a little repetitive around our loss pick process. But one of the things to keep in mind is most of the casualty growth we've been experiencing is through quota share participation alongside of our cedents. And so you really need to examine strategies that they're employing to stay ahead of loss trend and to ensure that current accident year picks can be sustained, particularly as you get into an environment where there's material inflation happening. And so what I would emphasize for you and some of what we've already discussed is, we've seen obviously a significant and extended period of time where rates have been going up meaningfully. We're years, 3.5 years into a rate on rate on rate environment, and that is very meaningful. We've also seen really significant reunderwriting actions by many of our cedents. That's risk selection, that's attachment points, that's limits, that's terms and conditions. And that builds a significant amount of underlying margin into the treaties that we're writing. And then obviously, in our own underwriting process, we're very thoughtful about which cedents we partner with. We're choosing them very carefully, and we price all of our deals from the ground up to ensure that there is strong margin in those deals. And that margin calculation that we're performing includes our forecast around what's going to happen with inflation, whether it's social or material. And as we indicated earlier, we were very quick to react to changing trends around inflation and all of that gets factored into our pricing. So I think that's really critical. And then the second part of it obviously gets back to what Juan was discussing earlier, which is our loss pick process. We've been very, very prudent about strengthening loss picks early on in this cycle. We've obviously performed better than expected against those picks from a pricing perspective. And again, that's not reflecting all the underwriting I described as pricing has outperformed assumptions, but we haven't reacted too quickly to that price improvement by lowering our pick. So we're kind of going in with some very prudent loss picks. And it's really the combination of those 2 factors in our view, gives us the confidence we need to continue to sustain that casualty book.

Okay. Switching over to insurance, if I could. You've grown nicely in your specialty, casualty segment there. And it's not just this quarter. So it's been going for a while. So I guess, quickly, just to make sure there's nothing one-off in this quarter, which I assume there's not. But can you maybe drill down then a little bit more detail and kind of some of the specific sublines that are inside what you call your specialty, casualty?

Sure. Thanks for the question. This is Mike Karmilowicz. Yes, within specialty, casualty segment, it includes mainly GL, the driver, umbrella, excess and commercial auto are the main factors that drive most of that business. And again, similar to the comments you made on the primary side, we're seeing a lot of the investment and so forth and just the rate and return in a lot of areas around that. As you've seen with the overall rate we've gotten in the last 3.5 years, we continue to see a lot of upside and opportunity across that, again, being very selective and very cautious about managing limits and how we approach the market.

Just to build on that, I don't think there was any particular one-offs in the quarter for that particular line of business. I think it was a pretty stable execution across all of that. The other things that we think about to are some of the specialty lines, like trade credit and political risk, M&A transactional liability, we saw some pretty good growth in there as well across the portfolio.

I think the one key thing for us ultimately is having a really well balanced and diversified portfolio across multiple segments and multiple geographies. And given the market share opportunity of a $900 billion market and where we stand today, we see considerable upside, and we're in a position of strength. So we are very optimistic about opportunity.

[Operator Instructions]. Our next question comes from Ryan Tunis from Autonomous Research.

Could you just talk a little bit on the IBNR provision for Ukraine, the assumptions that went into that, the type of range of outcomes around that? Is that a contemplation of a small number of potential claims or, I guess, a larger number of smaller ones? Just give us some feel for how that could potentially evolve.

Yes, Ryan, this is Juan. Let me start, and then I'll ask Jim to give you a little bit more color. I think as we've talked about really from the beginning of the year, there's a lot of uncertainty to this event, obviously, from the perspective that the war still ongoing. You really can't get claims adjusters on the ground. And we have gotten less than a handful of notices at this point in time. But these estimates are based on essentially ground-up assessment similar to frankly what we did during COVID, cedent by cedent to really try to understand the exposure by different lines of business. And it really does present sort of the best estimate that we have at this point for the lines that we articulated. But let me have Jim give you a bit more color on that.

Yes. Sure, Ryan, it's Jim. And I think Juan hit on something very important, which is the comparison with the process we used during COVID, where we review each and every treaty that could be affected by what's happening in the Ukraine. We are in communication with our cedents, obviously, studying all other industry data as it becomes available. It's -- obviously, there's not a lot of information at this point, and there's a great deal of uncertainty. But for -- in particular, the marine line, the political violence line and trade credit. We had enough information to make what we thought was a good estimate around potential loss exposure and that's where we made our selection for the second quarter. Obviously, as Juan indicated, we only have a small number of actual submitted losses. Those are all advisory losses. They don't include actual loss numbers. And so we'll continue to monitor and make adjustments if it becomes necessary.

And then on the casualty, reinsurance side, casualty pro rata growth. Can you just help us understand, I guess, like the dynamic there? We had, I think, 4 quarters in a row where growth is above 50%, and now it's moderated some. What exactly was the story there? Did you add a bunch of new business last year and now it's just getting rate on that? Or -- yes, I'm just kind of trying to understand the dynamics there.

Yes. Sure, Ryan. This is Jim again. The way I would describe it is, and it goes back to some comments that we've made a number of times around cedent selection. But that is one of the most fundamental aspects of how we conduct reinsurance underwriting is picking the right cedents to partner with, particularly when you're talking about a quota share structure. And so as the casualty market began to dislocate, pricing improved, terms and conditions were changing, et cetera. We worked with what our view are the best underwriters in the industry, and we took meaningful positions on their treaties. And so a lot of that unfolded in 2020 and certainly in 2021. And so as you achieve that, obviously, you now have a really, really strong position with an individual cedent, and you may choose to sustain that position versus necessarily increasing it year-over-year. And so some of the increase you'll get going forward on that particular cedent might be more in the form of just the growth of their own business, the growth of exposures, et cetera. So that is a major factor. However, even in addition to that, we continue to see some really nice opportunities in casualty on -- typically on a pro rata structure, and we're pursuing those opportunities, and we'll continue to do that.

Brian, this is Juan. I would just jump in at the very end. If you look in the supplement, our growth in casualty pro rata has actually been quite good for the first half of this year. We're at about $1.2 billion compared to about $954 million last year about this time. And it's really what Jim has been articulating.

There are no more questions in the queue. This concludes our question-and-answer session. I would like to turn the conference back over to Juan Andrade for any closing remarks.

Great. Thank you all for the questions and a great discussion today. I'm very optimistic about our future opportunity as evidenced by our growing global team, our consistent performance and track record. It's an exciting time to be at Everest. And as we continue to accelerate our strategic ambitions, we're creating more opportunity for our investors, clients and employees around the world. Thank you for your time and for your continued support of our company.

Conference has now concluded. Thank you for attending today's presentation. You may now disconnect.