AMERISAFE Announces 2023 Fourth Quarter and Year-end Results

Reports $62.1 Million of Net Income, Return on Equity of 20.4% and

Net Combined Ratio of 85.9% in 2023

AMERISAFE, Inc. (NASDAQ:AMSF), a specialty provider of workers' compensation insurance focused on high-hazard industries, today announced results for the fourth quarter and year ended December 31, 2023.

G. Janelle Frost, President and Chief Executive Officer, commented: "AMERISAFE's value proposition to our policyholders, agents, and shareholders rests on our service and delivering on our commitments to them. The Company collaborates closely with insured parties to assess risks, bolster safety measures, and meticulously handle claims to achieve optimal results. The Company's disciplined approach resulted in gross premium written growth of 8.4% and a combined ratio of 85.5% for the fourth quarter, and a 20.4% ROAE for the full year. Our capital strength and approach to the high-hazard workers' compensation market position AMERISAFE for solid performance and ability to create long-term shareholder value into the future."

INSURANCE RESULTS

• Voluntary premiums on policies written in the quarter were 4.7% higher than in the fourth quarter of 2022, primarily due to an increase in policy count partially offset by continued declines in approved loss costs. For the full year, voluntary premiums increased by 0.3%.
• Payroll audits and related premium adjustments increased premiums written by $4.8 million in the fourth quarter of 2023, compared to an increase of $2.3 million in the fourth quarter of 2022. For the full year 2023, audits and related premium adjustments increased premiums by $24.0 million, compared to an increase of $14.0 million in 2022.
• The loss ratio for both the fourth quarter and full year was 55.5%. During the quarter, the Company experienced favorable net loss reserve development for prior accident years, which reduced loss and loss adjustment expenses by $10.2 million, primarily from accident years 2018 through 2021. For the full year, the Company experienced favorable development on prior accident years of $41.4 million, compared with $40.6 million in 2022. The Company attributes its lower claim severities for prior years to proactive claims handling.
• For the quarter that ended December 31, 2023, the underwriting expense ratio was 28.9% compared with 26.4% in the same quarter in 2022, as a result of slightly lower earned premium and increased insurance related assessments. For the year ended December 31, 2023, the underwriting expense ratio was 29.3%, compared with 26.5% in 2022, largely due to slightly lower earned premium and increased insurance related assessments.
• The effective tax rate for the full year 2023 was 19.7% compared with 17.8% for 2022. The rate was slightly higher than last year due to a decrease in the proportion of tax-exempt interest income relative to taxable interest income and underwriting profit.

INVESTMENT RESULTS

• Net investment income for the quarter and full year ended December 31, 2023, increased 5.7% to $8.1 million and 15.1% to $31.3 million, respectively, due to higher fixed income reinvestment rates in relation to portfolio rolloff.
• Net unrealized gains on equity securities were $5.1 million in the fourth quarter. The full year unrealized gain of $1.2 million is reflective of favorable equity market returns during the year.
• As of December 31, 2023, the carrying value of AMERISAFE's investment portfolio, including cash and cash equivalents, was $896.5 million.

CAPITAL MANAGEMENT

During the fourth quarter of 2023, the Company repurchased 46,741 shares at an average cost (including commissions and excise tax) of $46.45 per share for a total of $2.2 million. The remaining outstanding share repurchase authorization as of December 31, 2023 is $10.4 million.

In an accompanying announcement, the Company's Board of Directors increased the regular quarterly dividend by 8.8% from $0.34 per share to $0.37 per share, payable on March 22, 2024, to shareholders of record as of March 8, 2024.

SUPPLEMENTAL INFORMATION

NON-GAAP FINANCIAL MEASURES

This release contains non-GAAP financial measures within the meaning of Regulation G promulgated by the U.S. Securities and Exchange Commission (the SEC) and includes a reconciliation of non-GAAP financial measures to the most directly comparable financial measures calculated in accordance with GAAP in the Supplemental Information in this release.

Management believes that investors' understanding of core operating performance is enhanced by AMERISAFE's disclosure of these financial measures which include operating net income, average adjusted shareholders' equity, operating return on average adjusted equity and operating earnings per share.

CONFERENCE CALL INFORMATION

AMERISAFE has scheduled a conference call for February 22, 2024, at 10:30 a.m. Eastern Time to discuss the results for the quarter and comment on future periods. To participate in the conference call, dial 323-794-2423 (Conference Code 9182860) at least ten minutes before the call begins.

Investors, analysts and the general public will also have the opportunity to listen to the conference call over the Internet by visiting the "Investor Relations Home" page of the "Investors" section of the Company's website (http://www.amerisafe.com). To listen to the live call on the web, please visit the website at least fifteen minutes before the call begins to register, download and install any necessary audio software. For those who cannot listen to the live webcast, an archive will be available shortly after the call at the same website location.

ABOUT AMERISAFE

AMERISAFE, Inc. is a specialty provider of workers' compensation insurance focused on small to mid-sized employers engaged in hazardous industries, principally construction, trucking, logging and lumber, agriculture, and manufacturing. AMERISAFE actively markets workers' compensation insurance in 27 states.

FORWARD LOOKING STATEMENTS

Statements made in this press release that are not historical facts, including statements accompanied by words such as "will," "believe," "anticipate," "expect," "estimate," or similar words are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding AMERISAFE's plans and performance. These statements are based on management's estimates, assumptions and projections as of the date of this release and are not guarantees of future performance and include statements regarding management's views and expectations of the workers' compensation market, the Company's growth opportunities, underwriting margins and actions by competitors. Actual results may differ materially from the results expressed or implied in these statements if the underlying assumptions prove to be incorrect or as the results of risks, uncertainties and other factors on the business and operations of the Company and our policyholders and the market value of our investment portfolio. Additional factors that may affect our results are set forth in the Company's filings with the Securities and Exchange Commission, including AMERISAFE's Annual Report on Form 10-K. AMERISAFE cautions you not to place undue reliance on the forward-looking statements contained in this release. AMERISAFE does not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after the date of this release.

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