Welcome to Assurant's Second Quarter 2025 Conference Call and Webcast. [Operator Instructions] It is now my pleasure to turn the floor over to Sean Moshier, Vice President of Investor Relations. You may begin.

Thank you, operator, and good morning, everyone. We look forward to discussing our second quarter results with you today. Joining me for Assurant's conference call are Keith Demmings, our President and Chief Executive Officer; and Keith Meier, our Chief Financial Officer. Yesterday, after the market closed, we issued an earnings release announcing our results for the second quarter 2025. The release and corresponding financial supplement are available on assurant.com. Also on our website is a slide presentation for our webcast participants. Some of the statements made today are forward-looking. Forward-looking statements are based upon our historical and current expectations and subject to risks, uncertainties and other factors that may cause actual results to differ materially from those contemplated by these statements. Additional information regarding these factors can be found in the earnings release, presentation and financial supplement on our website as well as in our SEC reports. During today's call, we will refer to non-GAAP financial measures, which we believe are important in analyzing the company's performance. For more details on these measures, the most comparable GAAP measures and a reconciliation of the 2, please refer to the earnings release, presentation and financial supplement on our website. We'll start today's call with remarks before moving into Q&A. I will now turn the call over to Keith Demmings.

Thanks, Sean, and good morning, everyone. We delivered a very strong second quarter with double-digit growth in both adjusted EBITDA and earnings per share, excluding reportable catastrophes. Our results were fueled by continued outperformance in Global Housing and growth in Global Lifestyle, reinforcing a strong first half of 2025. Through the first 6 months, adjusted EBITDA increased by 14% and adjusted EPS rose 16%, both excluding cats. Given our year-to-date performance, we're meaningfully increasing Assurant's full year 2025 growth expectations. Excluding catastrophes, we now expect full year adjusted EPS growth to approach 10%, driven by mid- to high single- digit growth in adjusted EBITDA. When excluding prior year reserve development, we expect to deliver double-digit underlying growth for both metrics. Additionally, our significant cash generation and balanced capital allocation continue to support long-term shareholder value. This year's performance reinforces our long-standing track record of success, driven by our powerful business model and the dedication of our global team. By combining innovative services with our protection and specialty insurance products, we deliver differentiated value through our unique B2B2C distribution channels in attractive lifestyle and housing markets. Our partnerships with the world's leading brands are powered by transparency, data-driven protection solutions and value-added services. We've continued to be a leader in our markets by embedding technology into our client systems, enabling exceptional customer experiences and optimizing performance. We are well positioned to achieve our ninth consecutive year of profitable growth in 2025. Our diversified business model enables us to perform consistently across a range of economic environments, often diverging from the broader industry trends. We believe this strength and resilience continue to differentiate Assurant from the broader P&C industry. Since 2019, we've delivered a compound annual growth rate of 12% in adjusted EBITDA and 18% in adjusted EPS, both excluding reportable cats.…

Thanks, Keith, and good morning, everyone. We were very pleased with the growth in the quarter across both Global Housing and Global Lifestyle. Overall, second quarter growth was strong with adjusted EBITDA increasing 13% and adjusted earnings per share growing 17%, both excluding cats. Our year-to- date performance supports the increase to our full year 2025 outlook, which I will cover shortly. Starting with capital. Our holding company liquidity position at quarter end was $518 million, providing us with flexibility to drive future growth. Our robust cash flow is a key differentiator for Assurant. In the quarter, our businesses upstreamed over $230 million of cash flow to the holding company, which allowed us to return $105 million to our shareholders, including $62 million of share repurchases. Through August 1, we repurchased an additional $25 million of shares and have now completed $150 million in repurchases so far this year. I'll now walk through our segment results in greater detail, beginning with Global Lifestyle. Second quarter adjusted EBITDA increased 6% compared to last year or 7% on a constant currency basis. In Connected Living, earnings increased 9% or 11% on a constant currency basis, led by our global mobile device protection programs and modest growth in our mobile trade-in programs. The strength in device protection was driven by strong subscriber growth from new mobile clients and programs that began last year. This is a prime example of our momentum given the important investments we made in 2024. Our device trade-in business saw improved profitability from higher volumes compared to prior year, including increased carrier promotions as well as consumer demand pull forward in the quarter. Based on historical trends, we anticipate lower sequential third quarter volumes given normal seasonality and a strong second quarter. Moving to Global Auto. Adjusted EBITDA was…

[Operator Instructions] Our first question will come from the line of Jeff Schmitt from William Blair.

So when I look at the overall benefit ratio in Global Lifestyle, it's around 23% to 24%, even up a little bit, I guess, from last year. Should we expect that to trend down as rate continues to earn through in Global Auto? Or is this sort of a decent run rate? I mean, how should we think about the trend there?

Yes. Maybe I'll offer a couple of overarching thoughts, and then Keith can talk about the trend line. I'd say, first of all, really pleased with the progress that you're seeing in the second quarter for Global Lifestyle overall. Certainly, Connected Living performed really well, up 11% constant currency. Auto, we're also seeing really nice stability there. And I think we're well positioned midway through the year, very much in line with our expectations and feel confident in the full year opportunity to grow both housing, auto and Connected Living overall. But Keith, what would you add about the benefit level?

Yes. I think, Jeff, overall, there's always a little bit of a mix shift in terms of the dynamics of the deal structures with the different clients within Lifestyle. The ones that we're really focused on is in auto. And I think what we're seeing there is the encouraging point this year where we're seeing the improvement in the vehicle service contract loss experience. And so I think that is really leading us to what we feel like is an inflection point this year for that business, which also allows us to feel good about our growth outlook for our auto business. And I think it sets us up for a nice run over the long term for our auto business.

Great. And then investment income from other investments was negative in the first half. What are those investments? And what's driving the decline there?

Yes. I think more than anything, Jeff, I would just start by saying our investment portfolio really continues to perform well. I think it reflects the quality and diversity of our investments. So overall, we're up year-over-year and for the quarter. And when you think about the other investments, we have things like real estate transactions that take place during the year. So that can create a little bit of lumpiness from a quarter-to-quarter basis. But overall, I think we're in a good position. Our book yields overall are up to 5.33%. That's 10 basis points over the first quarter. It's also 20 basis points better than the prior year. So I think we're -- our portfolio is performing well. And so I think from an overall position, I think we're in a good place for investment income. Overall, I think you can see us having a positive impact because of the higher average asset levels and then the positive yields in fixed income. And then that will be offset a little bit by the shorter-term investments and our cash investments. So I think -- but overall, we see investment income being up for the year.

Our next question comes from Tommy McJoynt with KBW.

Yes. So the first one here, just is there a way to think about any way to quantify any pull forward in consumer activity when we think about the number of devices that you guys reported or the number of protected vehicles that you guys had. Got the sense that there was a nice uplift in growth in the second quarter. So just trying to see if any of that was a pull forward of activity ahead of the tariffs.

Yes. Maybe we'll break it into 2 parts. I think when I look at Connected Living and mobile, in particular, we probably saw a little bit of pull forward relative to trade-in. There was more activity in the marketplace in general, more switching activity, more promotional work. And I think some of that was pull forward relative to tariffs. But I do think that the bulk of the beat in Connected Living was driven by the growth in device protection. You see the sequential growth in subscribers up 700,000, 2.4 million year-over-year. That, by far and away, was the lion's share of the improved profitability in the quarter. Trade-in certainly helped, but it wasn't the biggest driver. And then in terms of auto, maybe I'll offer one thought and then Keith can jump in. I think when you look at the first half auto sales overall, it was a pretty strong and resilient auto market. Our results kind of followed that as well. So I think retail car sales were up 6% or 7% year-to-date. you're seeing net written premiums up pretty significantly, 8% for Assurant year-to-date. So some of that certainly is pulled forward. I don't think the car sales will maintain at that same level in the second half, but no impact on earnings because obviously, that earns out over multiple years. But Keith, what else might you add?

Yes. I think overall, we are pleased with the momentum that we're building on our auto side for our sales growth. Keith mentioned the written premiums up 8%. I think that's a blend of some of the rate increases that we've had over the last couple of years. I think it's also driven by some new business wins that we highlighted a little bit earlier. And then I think there is a little bit of pull forward in demand in the early part of the quarter. But we also saw the production being pretty good as we went through the quarter. I think there's a little bit more promotional activity that the dealers are driving. And I think when there's promotional activity, I think that allows consumers to sometimes utilize some of those promotional dollars to buy some of the additional services like the extended service contracts. So overall, I think we like the progress we're making and our protected vehicles are up nicely in the quarter as well. So overall, liking the momentum we see on the auto sales side.

Okay. Got it. And switching over to the housing side. I'd like to look at the expense ratio within that segment. You guys have delivered a lot of operating leverage over the past few years. That expense ratio is now running in the high 30s. Could you talk about the opportunity to gain more leverage just as that business line continues to grow across both lender-placed, the voluntary market as well as renters growth? Maybe perhaps it would be helpful to think about what percentage of those costs are fixed versus more variable or commission-based. Any insights around the expense side of that thing?

Yes. I think a lot of the cost is the operational execution. Not a huge part of that is going to be commission. There's no commission in the lender-placed, which is obviously the biggest part of the housing business. And I think there is opportunity to continue to create leverage over time. And it's coming from a couple of different ways, Tommy. One, we're seeing obviously growth in the underlying lender-placed portfolio because of the hard market. We're also seeing growth because we're actually winning and gaining more market share with new clients. Some of our clients are onboarding new loans, et cetera. So there's natural growth coming through a couple of different ways. That naturally creates a lot of scale advantages, but then we're driving a tremendous amount of effort around technology automation, driving more operational efficiency Keith highlighted a couple of examples of how we're thinking about that within all of the businesses. And I think all of those things together create continuous opportunity to drive that expense level down. We want to create as much efficiency as we can. It's good for consumers. It's good for our clients. Ultimately, it's good for getting the right rates in the marketplace, and we're going to continue to be as efficient as we can to create value. But Keith, what would you add?

Yes. And I think along the lines of your question, Tommy, you can think about selling and underwriting type expenses being about 20% of the overall. So that leaves us that other 80% to be able to leverage like Keith talked about. So we do see a lot of opportunity as we continue to leverage our technology and scale.

Yes. And it's interesting. The investments that we make, they don't just make us more efficient. They make the solution set better, and it actually strengthens our competitive advantage in the marketplace, and it makes us more likely to win net new clients because we're just -- not only are we more efficient, but we're doing it in a way that's better from a consumer perspective.

[Operator Instructions] Our next question comes from Mark Hughes with Truist.

The prior year development, could you characterize where that is coming from in Global Housing?

Yes. So I'd say it's really related to 3 main things, Mark. I would say one is the improvements in Florida due to a lot of the regulatory changes that took place. We're also seeing some lower frequencies. And then certainly, the third thing is the inflation being lower than expected. And so I think that's just where we're really just reacting to those 3 elements that are driving our prior year development.

And then the tariffs, -- anything you observed so far, your thoughts about what that might mean going forward? And then how much cushion you might have in your second half guidance for tariff impacts?

Yes. Probably at the simplest level, very limited impact in the first half of the year. That was also true specifically to the second quarter. As we looked at the outlook, we certainly included our best estimate based on the most current information. I think very manageable as we look at the balance of the year. And we are staying proactive as well as we think about inflation over time, not just with our inflation guard feature within lender-placed, our ability to get rate with filed products and then our work with clients around service efficiency and rates and deal structure. So I feel like we're really well positioned. We try to be comprehensive in how we thought about the full year.

And then you talked about pressure in the voluntary market. And I think in earlier calls, you had maybe suggested that's helped retention that when consumers get the lender placed, they may be more likely to keep it. Do I remember that properly? And is that dynamic still in place to the same degree?

Yes. I think we're getting 2 things happening, right? We're seeing more policies placed because consumers are struggling to find coverage, and then we're keeping the policies longer. And it's meaningfully increased over time. And I think that's a function of the tough market and our rates have become more competitive and the product has been well received by consumers. But what else would you add, Keith?

Yes. I think customers are keeping our policies probably 6 to 12 months longer, Mark. And I think that just speaks to the things that we talked about earlier, where we're driving a lot of the expense leverage that can reduce the rate. So our products are looking, I think, more attractive and better to consumers than they've ever been before. So I think the price that we're delivering is good. And then we're also really delivering great service to the customers when they have needs as well. So I think that combination is serving us well.

Then I'll ask -- when you look at the new business pipeline for Lifestyle, you've mentioned a lot of kind of specific new programs, expansion of partnerships. How would you characterize the new business pipeline now versus 12, 24 months ago? And are there any themes that you would highlight about what is on the horizon for you?

Yes. A couple of thoughts. I think we've had a lot of momentum really the last couple of years across the board, whether that's in Connected Living, in housing and auto. I think we've seen some acceleration in the pipeline as we look forward from here. There are some things that we're actively working on. We talked about the investments we made in the first half being around $5 million to support new business growth, specifically in Connected Living. We think that will be more like an additional $10 million in the second half. Hopeful to be able to talk more in November about some of the things that we're working on. But I would say we are very excited about some of the things that we're going to announce. And it's a nice combination of new client wins adding additional services to expand relationships with major clients and then also launching new products. So it's a nice mix of activity and very much focused on Connected Living, but we are seeing a lot of opportunity for growth in the rest of the company as well. We talked about a big win in the auto space earlier in the discussion. The pipeline in lender-placed is quite strong, and we've seen a lot of momentum in renters with 12 consecutive quarters of double-digit growth in the property management channel on top of a pretty significant book roll. So lots of opportunity across the board, and certainly, that's the priority focus for this company.

There are no further questions at this time. I will now hand back to management for closing remarks.

All right. Well, thanks, everybody, for joining the call, and we will certainly look forward to updating you again in November. And until then, I hope everybody stays safe. Thanks very much.

Thank you. This does conclude today's teleconference. Please disconnect your lines at this time, and have a wonderful day.