TROY, Mich., Aug. 13, 2024 (GLOBE NEWSWIRE) -- Conifer Holdings, Inc. (NASDAQ:CNFR) ("Conifer" or the "Company") today announced results for the second quarter ended June 30, 2024. Second Quarter 2024 Financial Highlights (compared to the prior year period) Expense ratio improved 5.8 percentage points to 32.1% Net investment income increased 11.2% over the prior year period to $1.5 million Significant progress in planned gross written premium shift toward MGA model Management Comments Nick Petcoff, CEO of Conifer, commented, "We are pleased to report significant advances in our strategic transformation. Our main focus is shifting premium away from the traditional risk-bearing carrier revenue model to a more sustainable and scalable production-based revenue approach. This change reflects our commitment to aligning our business model with market demands by creating long-term value." Strategic Turn toward Non-Risk Bearing Revenue Conifer saw significant progress in the second quarter of 2024 in its initiative to run commercial gross written premium through its wholly owned managing general agency ("MGA"), Conifer Insurance Services (CIS). This strategic shift away from a traditional risk-bearing revenue model to focus instead on a wholesale agency, production-based approach began in late 2023, and the Company expects 100% of future commercial gross written premium to flow through its MGA. This approach is intended to optimize Conifer's resources and will complement the Company's shift to primarily focus on commission revenues within its MGA. Accordingly, Conifer anticipates that substantially all commercial lines business will be directly written by third-party insurers with A.M. Best ratings of A- or better by the end of the third quarter in 2024. During the second quarter of 2024, Conifer continued advancing its plan to direct premium to capacity providers for coverage across multiple commercial lines of business. Furthermore, the transfer of cannabis premium to capacity providers has progressed at a steady pace, and the Company expects to ultimately shift all premium for this line of business to its capacity partners as well. The Company expects that this and other capacity initiatives will significantly boost the premiums placed by its agency segment, ultimately driving higher commission revenue over time. The Company has continued to underwrite low-value homeowners business in Texas and the Midwest. As detailed in the Personal Lines results overview below, premium for the second quarter of 2024 increased 23.0% from the prior year period. 2024 Second Quarter Financial Results Overview   At and for the Three Months Ended June 30,   At and for the Six Months Ended June 30,   2024   2023   % Change   2024   2023   % Change   (dollars in thousands, except share and per share amounts)                         Gross written premiums $ 18,971     $ 44,674     -57.5%   $ 43,284     $ 80,888     -46.5% Net written premiums   13,247       29,328     -54.8%     28,638       47,670     -39.9% Net earned premiums   16,666       23,183     -28.1%     33,553       45,135     -25.7%                         Net investment income   1,505       1,354     11.2%     3,057       2,661     14.9% Net realized investment gains (losses)   (118 )     -     **     (118 )     -     ** Change in fair value of equity investments   (196 )     (12 )   **     (153 )     682     **                         Net income (loss) allocable to common shareholders   (3,950 )     (4,739 )         (3,876 )     (3,738 )     Earnings (loss) per share, diluted $ (0.32 )   $ (0.39 )       $ (0.32 )   $ (0.31 )                             Adjusted operating income (loss)*   (3,636 )     (4,727 )         (3,605 )     (4,420 )     Adjusted operating income (loss) per share* $ (0.30 )   $ (0.39 )       $ (0.30 )   $ (0.36 )                             Book value per common share outstanding $ (0.10 )   $ 1.38         $ (0.10 )   $ 1.38                               Weighted average shares outstanding, basic and diluted   12,222,881       12,220,331           12,222,881       12,218,102                               Underwriting ratios:                       Loss ratio (1)   91.5 %     83.0 %         76.6 %     72.9 %     Expense ratio (2)   32.1 %     37.9 %         33.4 %     37.6 %     Combined ratio (3)   123.6 %     120.9 %         110.0 %     110.5 %                             * The "Definitions of Non-GAAP Measures" section of this release defines and reconciles data that are not based on generally accepted accounting principles. ** Percentage is not meaningful (1) The loss ratio is the ratio, expressed as a percentage, of net losses and loss adjustment expenses to net earned premiums and other income from underwriting operations. (2) The expense ratio is the ratio, expressed as a percentage, of policy acquisition costs and other underwriting expenses to net earned premiums and other income from underwriting operations. (3) The combined ratio is the sum of the loss ratio and the expense ratio. A combined ratio under 100% indicates an underwriting profit. A combined ratio over 100% indicates an underwriting loss.                         2024 Second Quarter Gross Written Premium Gross written premiums decreased 57.5% in the second quarter of 2024 to $19.0 million, compared to $44.7 million in the prior year period. This decrease reflects the Company's continued progress toward its goal to reduce premium leverage on operating subsidiaries and focus on non-risk bearing revenue. Commercial Lines Financial and Operational Review Commercial Lines Financial Review     Three Months Ended June 30,   Six Months Ended June 30,   2024   2023   % Change   2024   2023   % Change   (dollars in thousands)                         Gross written premiums $ 6,782     $ 34,761     -80.5 %   $ 19,544     $ 63,736     -69.3 % Net written premiums   4,285       20,485     -79.1 %     12,572       32,726     -61.6 % Net earned premiums   8,681       17,487     -50.4 %     17,478       34,610     -49.5 %                         Underwriting ratios:                       Loss ratio   79.4 %     77.5 %         77.9 %     69.5 %     Expense ratio   25.3 %     37.4 %         29.1 %     36.8 %     Combined ratio   104.7 %     114.9 %         107.0 %     106.3 %                             Contribution to combined ratio from net                       (favorable) adverse prior year development   23.6 %     5.0 %         12.0 %     0.2 %