EIG Employers Holdings Inc

Employers Holdings, Inc. (the “Company”) (NYSE:EIG), a holding company with subsidiaries that are specialty providers of workers' compensation insurance and services focused on small and select businesses engaged in low-to-medium hazard industries, today reported financial results for its second quarter ended June 30, 2024.

Financial Highlights:(All comparisons vs. the second quarter of 2023).

• Net income per diluted share of $1.25, versus $1.30;
• Adjusted net income per diluted share of $1.10, versus $1.17;
• Gross premiums written of $207.9 million, an increase of 5%;
• Net premiums earned of $187.8 million, an increase of 6%;
• Net favorable prior year loss reserve development of $9.1 million, versus $19.7 million;
• GAAP combined ratio of 94.2% (95.4% excluding LPT), versus 90.4% (91.5% excluding LPT);
• Underwriting and general and administrative expense ratio of 22.0%, versus 26.0%;
• Net investment income of $26.9 million, an increase of $0.1 million, with interest and financing expenses related to investing activities of less than $0.1 million, a decrease of $1.9 million; and
• Record number of ending policies in-force of 128,522.

Management Commentary

Chief Executive Officer Katherine Antonello commented: “Higher new and renewal premiums, strong and steady net investment income and continued net investment gains drove year-over-year increases in revenue for both the second quarter and the first six months of 2024. We also ended the period with yet another record number of policies in-force, which were up 3% year-over-year.

We recorded our current accident year loss and LAE ratio on voluntary business at 64.0%, slightly above the 63.3% we maintained throughout 2023 and consistent with that of 2022. Our second quarter full reserve study led to the recognition of $9.3 million of net favorable prior year loss reserve development from our voluntary risk business, versus $20.0 million of net favorable development a year ago.

Our commission expense ratio was 14.3%, versus 13.3% a year ago. The increase was largely attributable to our strong new business writings, which are typically subject to a higher initial commission rate. Our ongoing efforts to reduce our underwriting and general and administrative expense ratio have been successful, and we ended the quarter with a ratio of 22.0%, down significantly from 26.0% a year ago. The decrease was primarily the result of the Cerity integration plan we executed in the fourth quarter of 2023.

Our resulting combined ratio excluding LPT was 95.4% for the second quarter (100.2% on a current accident year basis), versus 91.5% (102.7% on a current accident year basis), a year ago.

Lastly, we returned $27.0 million to our stockholders through a combination of share repurchases and regular quarterly dividends. This action reflects our strong balance sheet, abundant underwriting capital and our confidence in the Company’s future operations.”

Summary of Second Quarter 2024 Results

(All comparisons vs. the second quarter of 2023, unless otherwise noted).

Gross premiums written were $207.9 million, an increase of 5%. The increase was primarily due to higher new and renewal business writings, partially offset by lower final audit premiums. Net premiums earned were $187.8 million, an increase of 6%.

Losses and loss adjustment expenses were $108.8 million, an increase of 20%. The increase was primarily due to higher earned premium, a slightly higher current accident year loss and loss adjustment expense ratio and lower net favorable prior year loss reserve development. The Company recognized $9.1 million of net favorable prior year loss reserve development during the quarter versus $19.7 million a year ago. The Company’s loss and loss adjustment expense ratio was 57.9% (59.1% excluding LPT), versus 51.1% (52.2% excluding LPT).

Commission expenses were $26.8 million, an increase of 14%. The Company’s commission expense ratio was 14.3%, versus 13.3% a year ago. The increase primarily related to: (i) an increase in new business writings, which are typically subject to a higher initial commission rate; and (ii) a reduction in commission expense for uncollected premium recorded in the second quarter of 2023.

Underwriting and general and administrative expenses were $41.4 million, a decrease of 10%. The Company’s underwriting and general and administrative expense ratio was 22.0%, versus 26.0% a year ago. The decrease primarily related to decreases in professional fees, marketing and advertising expenses, facilities expenses and information technology expenses.

Net investment income was $26.9 million, an increase of 0.4%. The increase was primarily due to higher yields on our fixed maturity securities, largely offset by a lower invested balance of fixed maturity securities, as measured by amortized cost, resulting primarily from the unwinding of our former Federal Home Loan Bank (FHLB) leveraged investment strategy, which was in effect from the first quarter of 2022 to the fourth quarter of 2023.

Net realized and unrealized gains on investments reflected on the income statement were $2.2 million, versus $11.3 million.

Interest and financing expenses were less than $0.1 million, versus $1.9 million. The decrease resulted from the unwinding of our former FHLB leveraged investment strategy.

Income tax expense was $8.3 million (20.8% effective rate), versus $8.9 million (20.3% effective rate). The effective rates during each of the periods included income tax benefits and exclusions associated with tax-advantaged investment income, LPT adjustments, and deferred gain amortization.

The Company’s book value per share including the deferred gain of $44.91 increased 14.0% year-over-year and 2.7% during the second quarter of 2024, computed after considering dividends declared. During the second quarter this measure was unfavorably impacted by $4.9 million of after-tax unrealized losses arising from fixed maturity securities (which are reflected on the balance sheet), partially offset by $4.5 million of net after tax unrealized gains arising from equity securities and other investments (which are reflected on the income statement). The Company’s adjusted book value per share of $48.89 increased by 10.2% year-over-year and 2.8% during the second quarter of 2024, computed after considering dividends declared. During the second quarter this measure was favorably impacted by the net after tax unrealized gains arising from equity securities and other investments previously described.

Share Repurchases and Third Quarter 2024 Dividend Declaration

During the second quarter of 2024, the Company repurchased 461,789 shares of its common stock at an average price of $41.53 per share. During the period from July 1, 2024 through July 30, 2024, the Company repurchased a further 60,312 shares of its common stock at an average price of $42.56 per share. The Company currently has a remaining share repurchase authorization of $44.4 million.

On July 31, 2024, the Company’s Board of Directors declared a regular quarterly dividend of $0.30. The dividend is payable on August 28, 2024 to stockholders of record as of August 14, 2024.

Earnings Conference Call and Webcast

The Company will host a conference call on Thursday, August 1, 2024 at 11:00 a.m. Eastern Daylight Time / 8:00 a.m. Pacific Daylight Time.

To participate in the live conference call, you must first register here. Once registered you will receive dial-in numbers and a unique PIN number.

The webcast will be accessible on the Company’s website at www.employers.com through the “Investors” link.

Reconciliation of Non-GAAP Financial Measures to GAAP

The information in this press release should be read in conjunction with the Financial Supplement that is attached to this press release and available on our website.

Within this earnings release we present various financial measures, some of which are “non-GAAP financial measures” as defined in Regulation G pursuant to Section 401 of the Sarbanes - Oxley Act of 2002. A description of these non-GAAP financial measures, as well as a reconciliation of such non-GAAP measures to our most directly comparable GAAP financial measures is included in the attached Financial Supplement. Management believes that these non-GAAP measures are important to the Company's investors, analysts and other interested parties who benefit from having an objective and consistent basis for comparison with other companies within our industry. Management further believes that these measures are more relevant than comparable GAAP measures in evaluating our financial performance.

Forward-Looking Statements

In this press release, the Company and its management discuss and make statements based on currently available information regarding their intentions, beliefs, current expectations, and projections of, among other things, the Company's future performance, economic or market conditions, including current levels of inflation, changes in interest rates, labor market expectations, catastrophic events or geo-political conditions, legislative or regulatory actions or court decisions, business growth, retention rates, loss costs, claim trends and the impact of key business initiatives, future technologies and planned investments. Certain of these statements may constitute “forward-looking” statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts and are often identified by words such as “may,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “target,” “project,” “intend,” “believe,” “estimate,” “predict,” “potential,” “pro forma,” “seek,” “likely,” or “continue,” or other comparable terminology and their negatives. The Company and its management caution investors that such forward-looking statements are not guarantees of future performance. Risks and uncertainties are inherent in the Company’s future performance. Factors that could cause the Company's actual results to differ materially from those indicated by such forward-looking statements include, among other things, those discussed or identified from time to time in the Company’s public filings with the Securities and Exchange Commission (SEC), including the risks detailed in the Company's Quarterly Reports on Form 10-Q and the Company's Annual Reports on Form 10-K. Except as required by applicable securities laws, the Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

Filings with the SEC

The Company’s filings with the SEC and its quarterly investor presentations can be accessed through the “Investors” link on the Company's website, www.employers.com. The Company's filings with the SEC can also be accessed through the SEC's EDGAR Database at www.sec.gov (EDGAR CIK No. 0001379041).

About Employers Holdings, Inc.

EMPLOYERS® and America’s small business insurance specialist® are registered trademarks of EIG Services, Inc. Employers Holdings, Inc. is a holding company with subsidiaries that are specialty providers of workers' compensation insurance and services focused on small and select businesses engaged in low-to-medium hazard industries. The Company operates throughout the United States, with the exception of four states that are served exclusively by their state funds. Insurance is offered through Employers Insurance Company of Nevada, Employers Compensation Insurance Company, Employers Preferred Insurance Company, Employers Assurance Company and Cerity Insurance Company, all rated A- (Excellent) by the A.M. Best Company. Not all companies do business in all jurisdictions. See www.employers.com and www.cerity.com for coverage availability.

Contact Information

Mike Paquette (775) 327-2562 or mpaquette@employers.com

EMPLOYERS HOLDINGS, INC.Table of Contents
Page
1		Consolidated Financial Highlights
2		Summary Consolidated Balance Sheets
3		Summary Consolidated Income Statements
4		Return on Equity
5		Combined Ratios
6		Roll-forward of Unpaid Losses and LAE
7		Consolidated Investment Portfolio
8		Book Value Per Share
9		Earnings Per Share
10		Non-GAAP Financial Measures

EMPLOYERS HOLDINGS, INC.Consolidated Financial Highlights (unaudited)$ in millions, except per share amounts
		Three Months Ended												Six Months Ended
		June 30,												June 30,
			2024				2023			% change					2024				2023			% change
Selected financial highlights:
Gross premiums written		$	207.9			$	198.4				5	%		$	418.7			$	393.3				6	%
Net premiums written			206.1				196.6				5				415.2				389.7				7
Net premiums earned			187.8				177.1				6				372.6				349.8				7
Net investment income			26.9				26.8				—				53.8				54.4				(1	)
Net income excluding LPT(1)			29.6				32.9				(10	)			55.8				54.5				2
Adjusted net income(1)			27.9				31.4				(11	)			45.1				47.9				(6	)
Net Income before income taxes			40.0				43.8				(9	)			75.3				72.8				3
Net Income			31.7				34.9				(9	)			60.0				58.5				3
Comprehensive income			29.6				19.5				52				47.0				66.9				(30	)
Total assets															3,550.0				3,615.6				(2	)
Stockholders' equity															1,022.9				951.7				7
Stockholders' equity including the Deferred Gain(2)															1,118.2				1,053.8				6
Adjusted stockholders' equity(2)															1,217.2				1,184.3				3
Annualized adjusted return on stockholders' equity(3)			9.2	%			10.6	%			(13	)%			7.5	%			8.1	%			(7	)%
Amounts per share:
Cash dividends declared per share		$	0.30			$	0.28				7	%		$	0.58			$	0.54				7	%
Earnings per diluted share(4)			1.25				1.30				(4	)			2.36				2.16				9
Earnings per diluted share excluding LPT(4)			1.17				1.23				(5	)			2.19				2.01				9
Adjusted earnings per diluted share(4)			1.10				1.17				(6	)			1.77				1.77				—
Book value per share(2)															41.09				36.49				13
Book value per share including the Deferred Gain(2)															44.91				40.41				11
Adjusted book value per share(2)															48.89				45.41				8
Combined ratio excluding LPT:(5):
Loss and loss adjustment expense ratio:
Current Year			63.9	%			63.4	%							64.1	%			63.4	%
Prior Year			(4.8	)			(11.2	)							(2.5	)%			(5.7	)
Loss and loss adjustment expense ratio			59.1	%			52.2	%							61.6	%			57.7	%
Commission expense ratio			14.3	%			13.3	%							14.0	%			13.5	%
Underwriting and general and administrative expense ratio			22.0	%			26.0	%							23.4	%			25.8	%
Combined ratio excluding LPT			95.4	%			91.5	%							99.0	%			97.0	%
(1) See Page 3 for calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures.
(2) See Page 8 for calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures.
(3) See Page 4 for calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures.
(4) See Page 9 for description and calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures.
(5) See Pages 5 for details and Page 10 for information regarding our use of Non-GAAP Financial Measures.

EMPLOYERS HOLDINGS, INC.Summary Consolidated Balance Sheets (unaudited)$ in millions, except per share amounts
		June 30,2024				December 31,2023
ASSETS
Investments, cash and cash equivalents		$	2,471.8			$	2,504.7
Accrued investment income			16.7				16.3
Premiums receivable, net			399.8				359.4
Reinsurance recoverable, net of allowance, on paid and unpaid losses and LAE			423.7				433.8
Deferred policy acquisition costs			62.3				55.6
Deferred income tax asset, net			42.1				43.4
Contingent commission receivable—LPT Agreement			14.6				14.2
Other assets			119.0				123.0
Total assets		$	3,550.0			$	3,550.4
LIABILITIES
Unpaid losses and LAE		$	1,850.9			$	1,884.5
Unearned premiums			419.4				379.7
Commissions and premium taxes payable			65.2				66.0
Deferred Gain			95.3				99.2
Other liabilities			96.3				107.1
Total liabilities		$	2,527.1			$	2,536.5
STOCKHOLDERS' EQUITY
Common stock and additional paid-in capital		$	421.5			$	420.4
Retained earnings			1,429.4				1,384.3
Accumulated other comprehensive loss			(99.0	)			(86.0	)
Treasury stock, at cost			(729.0	)			(704.8	)
Total stockholders’ equity			1,022.9				1,013.9
Total liabilities and stockholders’ equity		$	3,550.0			$	3,550.4
Stockholders' equity including the Deferred Gain (1)		$	1,118.2			$	1,113.1
Adjusted stockholders' equity (1)			1,217.2				1,199.1
Book value per share (1)		$	41.09			$	39.96
Book value per share including the Deferred Gain(1)			44.91				43.88
Adjusted book value per share (1)			48.89				47.26
(1) See Page 8 for calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures.

EMPLOYERS HOLDINGS, INC.Summary Consolidated Income Statements (unaudited)$ in millions
	Three Months Ended								Six Months Ended
	June 30,								June 30,
		2024				2023				2024				2023
Revenues:
Net premiums earned	$	187.8			$	177.1			$	372.6			$	349.8
Net investment income		26.9				26.8				53.8				54.4
Net realized and unrealized gains on investments(1)		2.2				11.3				13.6				17.7
Other income (loss)		0.1				—				0.1				(0.2	)
Total revenues		217.0				215.2				440.1				421.7
Expenses:
Losses and LAE incurred		(108.8	)			(90.5	)			(225.3	)			(197.9	)
Commission expense		(26.8	)			(23.6	)			(52.3	)			(47.1	)
Underwriting and general and administrative expenses		(41.4	)			(46.0	)			(87.2	)			(90.3	)
Interest and financing expenses		—				(1.9	)			—				(4.2	)
Other expenses		—				(9.4	)			—				(9.4	)
Total expenses		(177.0	)			(171.4	)			(364.8	)			(348.9	)
Net income before income taxes		40.0				43.8				75.3				72.8
Income tax expense		(8.3	)			(8.9	)			(15.3	)			(14.3	)
Net Income		31.7				34.9				60.0				58.5
Unrealized AFS investment (losses) gains arising during the period, net of tax(2)		(4.9	)			(15.5	)			(16.5	)			7.1
Reclassification adjustment for net realized AFS investment losses in net income, net of tax(2)		2.8				0.1				3.5				1.3
Total comprehensive income	$	29.6			$	19.5			$	47.0			$	66.9
Net Income	$	31.7			$	34.9			$	60.0			$	58.5
Amortization of the Deferred Gain - losses		(1.5	)			(1.6	)			(3.0	)			(3.2	)
Amortization of the Deferred Gain - contingent commission		(0.4	)			(0.4	)			(0.8	)			(0.8	)
LPT contingent commission adjustments		(0.2	)			—				(0.4	)			—
Net income excluding LPT Agreement (3)		29.6				32.9				55.8				54.5
Net realized and unrealized gains on investments		(2.2	)			(11.3	)			(13.6	)			(17.7	)
Lease termination and asset impairment charges		—				9.4				—				9.4
Income tax expense related to items excluded from Net income		0.5				0.4				2.9				1.7
Adjusted net income	$	27.9			$	31.4			$	45.1			$	47.9
(1) Includes net realized and unrealized gains on equity securities and other investments of $5.7 million and $11.4 million for the three months ended June 30, 2024 and 2023, respectively, and $18.0 million and $19.4 million for the six months ended June 30, 2024 and 2023, respectively.
(2) AFS = Available for Sale securities.
(3) See Page 10 regarding our use of Non-GAAP Financial Measures.

EMPLOYERS HOLDINGS, INC.Return on Equity (unaudited)$ in millions
		Three Months Ended								Six Months Ended
		June 30,								June 30,
			2024				2023				2024				2023
Net income	A	$	31.7			$	34.9			$	60.0			$	58.5
Impact of the LPT Agreement			(2.1	)			(2.0	)			(4.2	)			(4.0	)
Net realized and unrealized gains on investments			(2.2	)			(11.3	)			(13.6	)			(17.7	)
Lease termination and asset impairment charges			—				9.4				—				9.4
Income tax expense related to items excluded from Net income			0.5				0.4				2.9				1.7
Adjusted net income (1)	B		27.9				31.4				45.1				47.9
Stockholders' equity - end of period		$	1,022.9			$	951.7			$	1,022.9			$	951.7
Stockholders' equity - beginning of period			1,018.9				974.1				1,013.9				944.2
Average stockholders' equity	C		1,020.9				962.9				1,018.4				948.0
Stockholders' equity - end of period		$	1,022.9			$	951.7			$	1,022.9			$	951.7
Deferred Gain - end of period			95.3				102.1				95.3				102.1
Accumulated other comprehensive loss - end of period			125.3				165.2				125.3				165.2
Income taxes related to accumulated other comprehensive loss - end of period			(26.3	)			(34.7	)			(26.3	)			(34.7	)
Adjusted stockholders' equity - end of period			1,217.2				1,184.3				1,217.2				1,184.3
Adjusted stockholders' equity - beginning of period			1,213.0				1,193.3				1,199.1				1,189.2
Average adjusted stockholders' equity (1)	D		1,215.1				1,188.8				1,208.2				1,186.8
Return on stockholders' equity	A / C		3.1	%			3.6	%			5.9	%			6.2	%
Annualized return on stockholders' equity			12.4				14.5				11.8				12.3
Adjusted return on stockholders' equity (1)	B / D		2.3	%			2.6	%			3.7	%			4.0	%
Annualized adjusted return on stockholders' equity (1)			9.2				10.6				7.5				8.1
(1) See Page 10 for information regarding our use of Non-GAAP Financial Measures.

EMPLOYERS HOLDINGS, INC.Combined Ratios (unaudited)$ in millions, except per share amounts
		Three Months Ended								Six Months Ended
		June 30,								June 30,
			2024				2023				2024				2023
Net premiums earned	A	$	187.8			$	177.1			$	372.6			$	349.8
Losses and LAE incurred	B		108.8				90.5				225.3				197.9
Amortization of deferred reinsurance gain - losses			1.5				1.6				3.0				3.2
Amortization of deferred reinsurance gain - contingent commission			0.4				0.4				0.8				0.8
LPT contingent commission adjustments			0.2				—				0.4				—
Losses and LAE excluding LPT(1)	C	$	110.9			$	92.5			$	229.5			$	201.9
Prior year loss reserve development			(9.1	)			(19.7	)			(9.2	)			(19.9	)
Losses and LAE excluding LPT - current accident year	D	$	120.0			$	112.2			$	238.7			$	221.8
Commission expense	E	$	26.8			$	23.6			$	52.3			$	47.1
Underwriting and general and administrative expense	F	$	41.4			$	46.0			$	87.2			$	90.3
GAAP combined ratio:
Loss and LAE ratio	B/A		57.9	%			51.1	%			60.5	%			56.6	%
Commission expense ratio	E/A		14.3				13.3				14.0				13.5
Underwriting and general and administrative expense ratio	F/A		22.0				26.0				23.4				25.8
GAAP combined ratio			94.2	%			90.4	%			97.9	%			95.9	%
Combined ratio excluding LPT:(1)
Loss and LAE ratio excluding LPT	C/A		59.1	%			52.2	%			61.6	%			57.7	%
Commission expense ratio	E/A		14.3				13.3				14.0				13.5
Underwriting and general and administrative expense ratio	F/A		22.0				26.0				23.4				25.8
Combined ratio excluding LPT			95.4	%			91.5	%			99.0	%			97.0	%
Combined ratio excluding LPT: current accident year:(1)
Loss and LAE ratio excluding LPT	D/A		63.9	%			63.4	%			64.1	%			63.4	%
Commission expense ratio	E/A		14.3				13.3				14.0				13.5
Underwriting and general and administrative expenses ratio	F/A		22.0				26.0				23.4				25.8
Combined ratio excluding LPT: current accident year			100.2	%			102.7	%			101.5	%			102.7	%
(1) See Page 10 for information regarding our use of Non-GAAP Financial Measures.

EMPLOYERS HOLDINGS, INC.Roll-forward of Unpaid Losses and LAE (unaudited)$ in millions
	Three Months Ended								Six Months Ended
	June 30,								June 30,
		2024				2023				2024				2023
Unpaid losses and LAE at beginning of period	$	1,874.5			$	1,953.7			$	1,884.5			$	1,960.7
Reinsurance recoverable, excluding CECL allowance, on unpaid losses and LAE		424.0				440.3				428.4				445.4
Net unpaid losses and LAE at beginning of period		1,450.5				1,513.4				1,456.1				1,515.3
Losses and LAE incurred:
Current year losses		120.0				112.2				238.7				221.8
Prior year losses on voluntary business		(9.3	)			(20.0	)			(9.3	)			(20.0	)
Prior year losses on involuntary business		0.2				0.3				0.1				0.1
Total losses incurred		110.9				92.5				229.5				201.9
Losses and LAE paid:
Current year losses		24.1				26.5				30.9				32.1
Prior year losses		104.7				88.4				222.1				194.1
Total paid losses		128.8				114.9				253.0				226.2
Net unpaid losses and LAE at end of period		1,432.6				1,491.0				1,432.6				1,491.0
Reinsurance recoverable, excluding CECL allowance, on unpaid losses and LAE		418.3				436.2				418.3				436.2
Unpaid losses and LAE at end of period	$	1,850.9			$	1,927.2			$	1,850.9			$	1,927.2

Total losses and LAE shown in the above table exclude amortization of the Deferred Gain and LPT contingent commission adjustments, which totaled $2.1 million and $2.0 million for the three months ended June 30, 2024 and 2023, respectively, and $4.2 million and $4.0 million for the six months ended June 30, 2024 and 2023, respectively.

EMPLOYERS HOLDINGS, INC.Consolidated Investment Portfolio (unaudited)$ in millions
		June 30, 2024															December 31, 2023
Investment Positions:		Cost or AmortizedCost (1)				Net Unrealized Gain (Loss)				Fair Value				%			Fair Value				%
Fixed maturity securities		$	2,136.6			$	(125.3	)		$	2,009.4			81	%		$	1,936.3			77	%
Equity securities			140.1				98.2				238.3			10				217.2			9
Short-term investments			30.9				—				30.9			1				33.1			1
Other invested assets			86.5				11.0				97.5			4				91.5			4
Cash and cash equivalents			95.5				—				95.5			4				226.4			9
Restricted cash and cash equivalents			0.2				—				0.2			—				0.2			—
Total investments and cash		$	2,489.8			$	(16.1	)		$	2,471.8			100	%		$	2,504.7			100	%
Breakout of Fixed Maturity Securities:
U.S. Treasuries and agencies		$	72.7			$	(2.9	)		$	69.8			3	%		$	60.5			3	%
States and municipalities			189.2				(4.2	)			185.0			9				210.2			11
Corporate securities			1,004.1				(61.7	)			941.7			47				895.8			46
Mortgage-backed securities			494.7				(50.6	)			443.7			22				426.0			22
Asset-backed securities			180.7				(3.3	)			177.2			9				128.0			7
Collateralized loan obligations			63.6				(0.1	)			63.5			3				91.5			5
Bank loans and other			131.6				(2.5	)			128.5			6				124.3			6
Total fixed maturity securities		$	2,136.6			$	(125.3	)		$	2,009.4			100	%		$	1,936.3			100	%

Weighted average book yield		4.3%				4.3%
Average credit quality (S&P)		A+				A
Duration		4.4				4.5
(1) Amortized cost excludes allowance for current expected credit losses of $1.9 million.

EMPLOYERS HOLDINGS, INC.Book Value Per Share (unaudited)$ in millions, except per share amounts
		June 30,2024				March 31,2024				December 31,2023				June 30,2023
Numerators:
Stockholders' equity	A	$	1,022.9			$	1,018.9			$	1,013.9			$	951.7
Plus: Deferred Gain			95.3				97.2				99.2				102.1
Stockholders' equity including the Deferred Gain (1)	B		1,118.2				1,116.1				1,113.1				1,053.8
Accumulated other comprehensive loss			125.3				122.6				108.9				165.2
Income taxes related to accumulated other comprehensive loss			(26.3	)			(25.7	)			(22.9	)			(34.7	)
Adjusted stockholders' equity (1)	C	$	1,217.2			$	1,213.0			$	1,199.1			$	1,184.3
Denominator (shares outstanding)	D		24,896,116				25,343,504				25,369,753				26,078,813
Book value per share (1)	A / D	$	41.09			$	40.20			$	39.96			$	36.49
Book value per share including the Deferred Gain(1)	B / D		44.91				44.04				43.88				40.41
Adjusted book value per share (1)	C / D		48.89				47.86				47.26				45.41
Year-over-year change in: (2)
Book value per share			15.7	%			14.5	%			18.1	%			6.5	%
Book value per share including the Deferred Gain			14.0				13.1				16.3	%			5.9
Adjusted book value per share			10.2				10.8				10.5	%			5.0
(1) See Page 10 for information regarding our use of Non-GAAP Financial Measures.
(2) Reflects the twelve month change in book value per share after taking into account dividends declared of $1.14, $1.12, $1.10 and $2.31 for the twelve month periods ended June 30, 2024, March 31, 2024, December 31, 2023, and June 30, 2023, respectively.

EMPLOYERS HOLDINGS, INC.Earnings Per Share (unaudited)$ in millions, except per share amounts
		Three Months Ended								Six Months Ended
		June 30,								June 30,
			2024				2023				2024				2023
Numerators:
Net income	A	$	31.7			$	34.9			$	60.0			$	58.5
Impact of the LPT Agreement			(2.1	)			(2.0	)			(4.2	)			(4.0	)
Net income excluding LPT (1)	B		29.6				32.9				55.8				54.5
Net realized and unrealized gains on investments			(2.2	)			(11.3	)			(13.6	)			(17.7	)
Lease termination and asset impairment charges			—				9.4				—				9.4
Income tax expense related to items excluded from Net income			0.5				0.4				2.9				1.7
Adjusted net income (1)	C	$	27.9			$	31.4			$	45.1			$	47.9
Denominators:
Average common shares outstanding (basic)	D		25,278,473				26,691,652				25,312,208				26,932,897
Average common shares outstanding (diluted)	E		25,363,941				26,803,340				25,449,957				27,096,669
Earnings per share:
Basic	A / D	$	1.25			$	1.31			$	2.37			$	2.17
Diluted	A / E		1.25				1.30				2.36				2.16
Earnings per share excluding LPT: (1)
Basic	B / D	$	1.17			$	1.23			$	2.20			$	2.02
Diluted	B / E		1.17				1.23				2.19				2.01
Adjusted earnings per share: (1)
Basic	C / D	$	1.10			$	1.18			$	1.78			$	1.78
Diluted	C / E		1.10				1.17				1.77				1.77
(1) See Page 10 for information regarding our use of Non-GAAP Financial Measures.

Non-GAAP Financial Measures

Within this earnings release we present the following measures, each of which are "non-GAAP financial measures." A reconciliation of these measures to the Company's most directly comparable GAAP financial measures is included herein. Management believes that these non-GAAP measures are important to the Company's investors, analysts and other interested parties who benefit from having an objective and consistent basis for comparison with other companies within our industry. Management further believes that these measures are more relevant than comparable GAAP measures in evaluating our financial performance.

The LPT Agreement is a non-recurring transaction that does not result in any meaningful ongoing cash benefits to the Company. Management believes that providing non-GAAP measures that exclude the effects of the LPT Agreement (amortization of deferred reinsurance gain, adjustments to LPT Agreement ceded reserves and adjustments to contingent commission receivable) is useful in providing investors, analysts and other interested parties a meaningful understanding of the Company's ongoing underwriting performance.

Deferred reinsurance gain (Deferred Gain) reflects the unamortized gain from the LPT Agreement. This gain has been deferred and is being amortized using the recovery method, whereby the amortization is determined by the proportion of actual reinsurance recoveries to total estimated recoveries, except for the contingent profit commission, which is being amortized through June 30, 2024. Amortization is reflected in losses and LAE incurred.

Adjusted net income (see Page 3 for calculations) is net income excluding the effects of the LPT Agreement, and net realized and unrealized gains and losses on investments (net of tax), and any miscellaneous non-recurring transactions (net of tax). Management believes that providing this non-GAAP measures is helpful to investors, analysts and other interested parties in identifying trends in the Company's operating performance because such items have limited significance to its ongoing operations or can be impacted by both discretionary and other economic factors and may not represent operating trends.

Stockholders' equity including the Deferred Gain (see Page 8 for calculations) is stockholders' equity including the Deferred Gain. Management believes that providing this non-GAAP measure is useful in providing investors, analysts and other interested parties a meaningful measure of the Company's total underwriting capital.

Adjusted stockholders' equity (see Page 8 for calculations) is stockholders' equity including the Deferred Gain, less accumulated other comprehensive income (net of tax). Management believes that providing this non-GAAP measure is useful to investors, analysts and other interested parties since it serves as the denominator to the Company's adjusted return on stockholders' equity metric.

Return on stockholders' equity and Adjusted return on stockholders' equity (see Page 4 for calculations). Management believes that these profitability measures are widely used by our investors, analysts and other interested parties.

Book value per share, Book value per share including the Deferred Gain, and Adjusted book value per share (see Page 8 for calculations). Management believes that these valuation measures are widely used by our investors, analysts and other interested parties.

Net income excluding LPT (see Page 3 for calculations). Management believes that these performance and underwriting measures are widely used by our investors, analysts and other interested parties.