Earnings call transcript: Old Republic Q2 2025 sees steady growth amid market challenges

Old Republic International Corporation reported its Q2 2025 earnings, highlighting a solid financial performance with a 9% increase in earnings per share (EPS) to $0.83, up from $0.76 in the same quarter last year. The company’s consolidated pre-tax operating income rose to $267.5 million from $253.8 million in Q2 2024. The stock, now trading near its 52-week high of $44, has delivered impressive returns with a 28.45% gain year-to-date. According to InvestingPro analysis, Old Republic maintains a GREAT financial health score of 3.2 out of 4, demonstrating strong operational performance despite challenging market conditions.

Key Takeaways

• EPS increased by 9% year-over-year to $0.83.
• Consolidated pre-tax operating income rose to $267.5 million.
• Book value per share increased by 12.6%.
• Continued investment in technology and AI capabilities.

Company Performance

Old Republic demonstrated resilience in Q2 2025, with strong financial metrics despite facing a challenging real estate market influenced by high interest rates. The company’s diversified insurance portfolio and strategic focus on specialty lines contributed to its steady performance. The expansion in excess and surplus lines, coupled with investments in new specialty underwriting subsidiaries, underpinned growth.

Financial Highlights

• Revenue: Not disclosed for Q2 2025.
• Earnings per share: $0.83, up from $0.76 in Q2 2024.
• Book value per share: $25.14, a 12.6% increase.
• Regular cash dividends paid: $71 million.

Outlook & Guidance

Looking ahead, Old Republic expects continued profitable growth in its specialty insurance segment. The company is targeting a title insurance combined ratio below 95% and plans to continue exploring AI and technology investments to enhance its operational efficiency. The EPS forecast for future quarters indicates a stable growth trajectory, with expectations of $0.92 for Q4 2025 and $3.46 for the full year 2025.

Executive Commentary

CEO Craig Smiddy emphasized the company’s commitment to long-term success, stating, "We focus on our definition of success as 10 years out." He also highlighted efforts to improve efficiency, saying, "We never stop looking inward to see what we could be doing at a more efficient level." These comments reflect Old Republic’s strategic focus on sustainable growth and operational excellence.

Risks and Challenges

• High interest rates impacting the real estate market.
• Competitive pressures in the insurance sector, particularly in large account business.
• Potential challenges in the title insurance market, especially in regions like Texas.
• The need to successfully integrate AI and technology investments.

Old Republic’s Q2 2025 performance underscores its ability to navigate a complex market environment through strategic investments and a focus on long-term growth. With a strong return on equity of 15% and robust cash flow generation, the company appears well-positioned for future challenges and opportunities. For detailed analysis and comprehensive insights, including Fair Value estimates and growth projections, explore the full Old Republic research report available on InvestingPro, part of their coverage of 1,400+ US stocks.

Full transcript - Old Republic International Corp (ORI) Q2 2025:

Conference Call Operator: Good afternoon and welcome to Old Republic International Corporation’s second quarter 2025 earnings conference call. All participants are in a listen-only mode. After the speakers’ remarks, we’ll conduct a question and answer session. To ask a question at that time, you’ll need to press STAR followed by the number one on your telephone keypad. As a reminder, this conference call is being recorded. I would now like to turn the call over to Joe Calabrese at MWW. Thank you. Please go ahead.

Craig Smiddy, President and CEO, Old Republic International Corporation: Thank you. Good afternoon everyone and thank you for joining us for the Old Republic International Corporation conference call to discuss second quarter 2025 results. This morning we distributed a copy of the press release and posted a separate financial supplement. Both of the documents are available on Old Republic’s website at www.oldrepublic.com. Please be advised that this call may involve forward-looking statements, as discussed in the press release dated July 24, 2025. Assumptions, uncertainties, and risks exist that may cause results to differ materially from those set forth in these forward-looking statements. For more information on the assumptions, uncertainties, and risks, please refer to the forward-looking statements discussion in the press release and the company’s other SEC filings and the risk factors discussed in the company’s most recent Form 10-K and other recent SEC filings.

We may also include references to net income, excluding net investment gains or net operating income, a non-GAAP financial measure, in our remarks or in responses to questions. GAAP reconciliations are included in the press release. Presenting on today’s conference call will be Craig Smiddy, President and CEO, Frank Sodaro, Chief Financial Officer, and Carolyn Monroe, President and CEO of Old Republic National Title Holding Company. Management will make some opening remarks and then we’ll open the line for your questions. At this time I’d like to turn the call over to Craig. Please go ahead, sir. All right, Joe. Thank you very much and good afternoon everyone. Thank you for joining our call and welcome again to our second quarter 2025 earnings discussion. Our story of strong growth and strong profitability continued through the second quarter of this year.

During the second quarter we produced $267.5 million of consolidated pre-tax operating income, up from $253.8 million in Q2 2024. Our consolidated combined ratio was 93.6% compared to 93.5% in the second quarter of last year. In specialty insurance, we grew net premiums earned by 14.6% in the second quarter and produced $253.7 million of pre-tax operating income. That was up from $202.5 million in the second quarter last year. The specialty insurance combined ratio was 90.7% in the quarter and that compares to 92.4% in the second quarter of last year. In title, despite the continuation of higher mortgage interest rates and a slow real estate market, the title insurance folks grew premiums and fees earned by 5.2% compared to the second quarter last year, and they produced $24.2 million of pre-tax operating income, down from $46 million in the second quarter last year.

The title combined ratio was 99 in the quarter compared to 95.4 in the second quarter of last year. Carolyn will give us a little more insight into those figures. Our conservative reserving practices continue to produce favorable prior year loss reserve development in both specialty insurance and title insurance. Our balance sheet remains strong, and we continue to invest in our new specialty underwriting subsidiaries as well as in technology and in talent. With that as opening remarks, I’ll now turn the discussion over to Frank, and Frank will then turn things back to me to cover specialty insurance. I’ll turn things over to Carolyn to cover title insurance, and then we’ll open it up to the Q and A part. With that, I hand it to you, Frank.

Frank Sodaro, Chief Financial Officer, Old Republic International Corporation: Thank you, Craig, and good afternoon, everyone. This morning we reported net operating income of $209 million for the quarter compared to $202 million last year. On a per share basis, comparable year-over-year results were $0.83 compared to $0.76, a 9% increase. Net investment income increased 2.4% as a result of higher yields on the bond portfolio, partially offset by lower invested asset base from returning excess capital, and that included the $500 million paid as a special dividend during the first quarter of this year. Our average reinvestment rate on corporate bonds during the quarter was 5% compared to the average yield rolling off of about 4%. The total bond portfolio book yield now stands at 4.7% compared to 4.5% at the end of last year.

Turning now to loss reserves, both specialty insurance and title insurance recognized favorable development in the quarter, leading to a benefit in the consolidated loss ratio of 2.1 percentage points compared to 2.2 points last year. Within specialty insurance, workers’ compensation continued to have strong favorable development and accounted for the majority of the group’s total favorable development. Commercial auto and property also had favorable development, while general liability had unfavorable development. However, the year-to-date impact was less than 0.5% on the specialty insurance loss ratio. We ended the quarter with book value per share of $25.14, which, inclusive of the regular dividend, equated to an increase of just over 12.6%, resulting primarily from our strong operating earnings and higher investment valuations. In the quarter, we paid $71 million in regular cash dividends.

We did not repurchase any shares during the quarter, and our repurchases since the end of the quarter were not material. That left us with just over $200 million remaining in our current repurchase program. I’ll now turn the call back over to Craig for discussion of specialty insurance.

Craig Smiddy, President and CEO, Old Republic International Corporation: All right, thanks Frank. Specialty insurance net written premiums were up 9% in the second quarter and that came from strong renewal retention ratios, rate increases on most lines of coverage, solid new business writings, and an increasing level of premium production in our new specialty underwriting subsidiaries. We continue to expand our excess and surplus lines with excess and surplus lines direct written premiums up 12% so far this year. As mentioned in my opening remarks, in the second quarter specialty insurance pre-tax operating income was $254 million and the combined ratio was 90.7. The loss ratio for the second quarter was at 62.5 and that included 2.9 percentage points of favorable prior-year loss reserve development compared to 64.3 in the second quarter last year that included 2.5 points of favorable development.

The expense ratio was in line with expectation, coming in at 28.2 in the second quarter compared to 28.1 in the second quarter last year. Given these top line and bottom line results, we continue on our journey of profitable growth within specialty insurance. Now to just dive into the details a little bit more on commercial auto insurance and workers’ compensation insurance. Commercial auto insurance net premiums written grew 10% in the second quarter while the loss ratio came in at 70.3 compared to 72.3 last year. Rate increases on commercial auto insurance were approximately 14% which will keep us ahead of the loss severity trend we’re observing. Workers’ compensation insurance net premiums written were 2% lower in the second quarter while the loss ratio came in at 48.5 compared to 50.7 last year.

We saw rates stay relatively flat this quarter while loss frequency trend continues to decline and loss severity trend remains stable. Given the higher wage trend within payroll, which is what we apply our rates to, and given the declining loss frequency trend and stable loss severity trend, we think our rate levels for workers’ compensation insurance remain adequate. Going forward, we expect solid growth and profitability to continue in specialty insurance throughout the rest of this year, reflecting the success of our specialty strategy and our operational excellence initiatives. We also expect to continue to see growing contributions from our newer specialty underwriting subsidiaries. That’s a high-level summary for the Specialty Insurance Group. I’ll now turn the discussion over to Carolyn who will report on our Title Insurance Group.

Carolyn Monroe, President and CEO of Old Republic National Title Holding Company, Old Republic International Corporation: Carolyn, thank you, Craig. Title insurance reported premium and fee revenue for the quarter of $698 million. This represents an increase of 5% from the second quarter of last year. Although we are pleased with continued revenue improvement, we’ve seen very little change in the real estate and mortgage market conditions. Premium from our direct title operations were up 3% from the second quarter of 2024. Our agency-produced premiums were up 7% and made up 77% of our revenue during the quarter, up from 76% during the second quarter of last year. Commercial premiums increased this quarter and were 23% of our earned premiums compared to 21% in the second quarter of last year. Investment income was also up this quarter nearly 12% compared to the second quarter of 2024. Our overall loss ratio increased to 2.9% this quarter compared to 2.3% in the second quarter of last year.

Although prior policy years continued to develop favorably, the amount of favorable development in the second quarter of this year was less than the second quarter of 2024. Our pre-tax operating income this quarter was $24 million compared to $46 million in the second quarter of last year. Our expense ratio was 96.1% compared to 93.1% in the second quarter of 2024. Cost from the settlement of a legal matter was the primary driver of this increase. Our combined ratio increased to 99% this quarter compared to 95.4% in the second quarter of last year. During the quarter, we continued progressing with the advancement of digital transaction tools and solutions for our directs and our title agents. Through our strategic partnerships, we remain focused on the importance of providing our agents and employees with the innovative technological solutions required to maintain a competitive edge.

These include our internal systems such as our remittance policy, issuance and rate engines to work seamlessly with all the closing and production platforms, and I’ll now turn it back to Craig.

Craig Smiddy, President and CEO, Old Republic International Corporation: Okay, thanks Carolyn. Profitable growth continues in specialty insurance and in title insurance. We remain focused on profitability in a very challenging marketplace. As noted in the Financial Supplement, annualized operating return on beginning equity improved to an annualized rate of 14.6% compared to an annualized rate of 12.1% in the second quarter last year, which is reflective of our thoughtful management of capital. That concludes our prepared remarks. We’ll now open up the discussion to Q and A where either I’ll answer your questions or I’ll ask Frank or Carolyn to help me out.

Conference Call Operator: As a reminder to ask a question, please press star followed by the number one on your telephone keypad. To withdraw any questions, please press star one again. We’ll pause for just a moment to compile the Q&A roster. Our first question comes from Greg Peters from Raymond James. Please go ahead. Your line is open.

Good afternoon everyone. In your comments, Craig, you talked about retention across your specialty property casualty business. Can you give us a little more detail about how retention is moving across different lines of business?

Craig Smiddy, President and CEO, Old Republic International Corporation: Sure, Greg, be happy to. We do look at our renewal retention metrics by line of business and by each one of our 17 different subsidiary companies. I can tell you that regardless of the line of business or the subsidiary, we are experiencing renewal retentions north of 85% pretty much across the board. We think that is attributable to our value proposition whereby we’re not selling price, we’re selling service, we’re selling long term commitment to these market segments, selling our specialty expertise in underwriting, customer service, risk control, claims handling.

Our long and short of it is we think we have sticky renewal retention ratios given our, again, our value proposition and the kind of clients and distribution partners we work with that are focused on the long term and not those distribution partners that, as we say, the so-called spreadsheeting of price and going with low price, that’s not the type of customer that we go after. Therefore, as I say, across all lines of business, across all subsidiaries, very strong renewal retention ratios. Yeah.

The reason for the question is there’s a lot of commentary on the other calls that have happened so far about competition pockets in certain areas. One of the themes that has emerged in the first half of this year is increasing competition in the larger account business. It’s more property than probably where you play. Maybe you could segue and just talk a little bit about how your business at Old Republic Risk Management is sharing because I know that targets the larger account larger corporate market.

Yeah, thanks for that question, Greg. I agree with your comments. I think one of the things that does differentiate us, even on property, for us we had a slight uptick in our overall property rate increase this quarter because the property we’re writing is not the large account catastrophic exposed types of properties. We’re writing property that is often packaged along with the other lines of business. Yes, some of our property has catastrophic exposure and we buy catastrophic reinsurance to protect us on that. We’re not a big writer of property cat, where I think a lot of our peers have pretty decent sized portfolios. We don’t have that dynamic that others are experiencing. Overall, I think the competition that we’re seeing elsewhere is nothing that I would say is a dramatic change from what we’ve seen earlier.

Again, back to our value proposition and the kind of clients that we’re seeking. An example where perhaps we have seen competition and we’ve pulled back a little bit, as I’ve talked about the last few quarters, public company D&O in our subsidiary that does write a fair amount of that business, we’ve been pulling back. Rate decreases on public D&O look like they’re starting to flatten out, still a little negative, but we’ve been encouraging our underwriters there to maintain rate. If that means top line is down like it was last year on public D&O, that’s perfectly fine. We’re not immune to the competition. I think there are some differences in our business model as well as the lines of business that we’re in and in risk management.

Just had a 40-year risk management client into our corporate headquarters here a couple of days ago and had a nice conversation with them. On that business, as you know Greg, it’s all about service and that’s why that business is so sticky for us. That’s why we have 40-year relationships with a lot of the big clients. They retain a lot of their risk themselves, so they’re not looking to us for risk transfer, they’re looking to us for service. We have large deductibles or they have captives that we cede most of the premium back to. There too, that requires a relationship and long-term focus. There’s a lot of collateral at stake there. When we collateralize, we have those obligations collateralized by the client. It has to be a relationship. We have very strong long-term relationships in our large account risk management business for sure.

We continue to add new clients based on a lot of discussion, as you know from attending RIMS or other events among the risk managers of large companies. We have a top tier reputation.

Thanks for that additional information. I guess I’ll just ask one other question. I’ll pivot to the title business. One of the things that’s popped up in the second quarter was the issue around what’s happening with title insurance rates in Texas, and there’s a rate decrease that’s being implemented. Just curious about what your views on that are. Do you anticipate that that’s going to spread to other states, or how does that impact your operations? Give us a broader sense of how you see the market reacting to that.

Carolyn, I’ll start off. You and I have had discussions about this, and you know every state is very different. Texas is unique in promulgating specific rates, and other states we file rates. Carolyn has, I know, been working closely with her team to take a very careful look at our rates and make sure we have adequate rates in every state. Our assessment, I think thus far, Carolyn, you correct me if I’m wrong, but I think our assessment so far is that the promulgated rate in Texas is still an adequate rate. I’ll let you talk more about that, Carolyn.

Carolyn Monroe, President and CEO of Old Republic National Title Holding Company, Old Republic International Corporation: Yeah, also, Greg, if I’m not mistaken, right now that rate decrease has not gone into effect because it’s been challenged. The last I checked, the challenge was held up in the court. I think they’re trying to come to maybe a more reasonable settlement than what was initially proposed. That has not taken effect yet. You know, when they generally in the promulgated states like Texas, New Mexico, and Florida, they look at prior year history and kind of determine if it’s an adequate rate. We have a lot of input on determining that as well; our state associations do. I would think whatever we come up with will be an adequate way to still service the industry.

Okay, thanks for the answer.

Conference Call Operator: Ladies and gentlemen, once again, it is Star One. If you have a question, we’ll go next to Paul Newsome from Piper Sandler.

Craig Smiddy, President and CEO, Old Republic International Corporation: Good afternoon. Thanks for the call. One, maybe to revisit capital management, there was no stock repurchased in the last quarter. It sounds like not to date. You know, why not? And you know, how do you think about your own capital position at the moment? Sure, Paul, I’ll be happy to talk about that. As Frank mentioned in his opening comments, as a reminder, we had a $2 special dividend that we just paid in the first quarter, and that was on top of the large amount of share repurchases that we made last year and in the preceding few years. We closely look at both tools in our tool chest, special dividends as well as share repurchases. We’re also very mindful of where the market price is relative to our book value when we make share repurchase decisions.

You know that the higher the market price is to book, the less we’re going to be excited about share repurchases. On the other hand, the lower the market price is to book, the more excited we get about share repurchases. To manage capital, we’re cognizant of ROE. As I mentioned in my opening comments, we’re very thoughtful about capital management. While we think we carry probably more capital than some of our peers, we want to maintain a strong balance sheet and be prepared for the unforeseen, and we want to continue to invest, be able to invest in new opportunities. We’re conservative in the amount of capital we carry, but we’re also very cognizant of ROE and we don’t want to carry too much capital.

That was primarily what led us to the decision that on top of all the share repurchases, we also issued a special dividend in the first quarter because we were carrying far too much capital. We’ll use both tools and we’ll look at both options and take into consideration what has the best benefit to shareholders, and then we present that to our board with a recommendation from management and proceed accordingly. Second question, maybe a little bit more commentary on the investment outlook. You know, obviously a combination of cash flow and new money yields. Where do you think the longer term trend here, at least the intermediate trend, is for investment? I’d be happy to start it off.

I think Frank might have addressed it in our opening comments, but if you compare where our new money rates are coming in on our fixed income portfolio vis-à-vis our average yield on our portfolio, that’s getting pretty tight. I think that there can’t be a big expectation that that’s going to improve dramatically incrementally. Maybe there still might be a little room comparing those differences between new money and our existing yield, but no big, dramatic change. Frank, please feel free to correct me if you see it differently or if you have anything to add.

Frank Sodaro, Chief Financial Officer, Old Republic International Corporation: No, I would just say the biggest component now is as we’ve returned so much capital, our base is so much lower from a yield perspective. That’s right. It’s tightening up. I would expect there to be improvements, all things being equal. No longer would I expect that 10% to 15% and higher that we had. Somewhere along the mid single digits is probably what I would say, all things being equal.

Craig Smiddy, President and CEO, Old Republic International Corporation: Appreciate it. Nice to be able to put Frank in a hot seat.

Frank Sodaro, Chief Financial Officer, Old Republic International Corporation: Appreciate that, Paul.

Conference Call Operator: The next question will come from Evan Tyndale, Byroom Capital.

Craig Smiddy, President and CEO, Old Republic International Corporation: Hi, thanks for taking my call. Hi, Evan.

Conference Call Operator: Hi.

Craig Smiddy, President and CEO, Old Republic International Corporation: My question is on the specialty insurance segment. You guys have pretty consistently now been posting combined ratios like around 90, 91, and obviously you guys guide to 90 to 95 over the full cycle. I’m just wondering, given how consistently you’ve kind of outperformed or almost outperformed that range, can you talk about has anything fundamentally changed in terms of the mix of your business or how well you guys are executing that might allow you to tighten or lower that range in terms of guidance on the combined ratio for the full cycle, or do you guys still expect that to go back up to 95% at some point?

Frank Sodaro, Chief Financial Officer, Old Republic International Corporation: Right.

Craig Smiddy, President and CEO, Old Republic International Corporation: Let me first just say a comment that I made earlier about the complexion of our portfolio and the fact that we’re not writing large catastrophic property business per se vis a vis our peers. We have some of that exposure, but when you write a large amount of catastrophic property, you can post some pretty decent combined ratios in good quarters and then you post some fairly awful combined ratios in quarters where there is a catastrophic event. I think our combined ratio, given our casualty focused business, is going to be in that range of 90 to 95. We have written a little bit more property and short tail business.

As you can tell in the supplement, you can see the growth rate in property has been a little bit stronger as we improve our footprint with our Inland Marine new specialty subsidiary, our new excess and surplus lines specialty subsidiary. They’re able to write property in conjunction with other coverages, and we’ve grown it, but it’s still not a huge area for us. Given our predominantly casualty focused business and our conservative loss reserving approaches, that 90 to 95 is still a good target. If you were able to parse out the property catastrophic portions of our competitors’ combined ratio and strip out the other drivers of lower combined ratio lines of business, I think that’s a pretty respectable target and difficult to achieve a much lower target on the lines we write, particularly given the proportions of our lines of business. Okay, great. Thank you. One other question.

Obviously, there’s been, you know, artificial intelligence is the talk of the town in various industries, and I’m just curious how you guys are playing with or implementing artificial intelligence at this point, if you think it can maybe make the underwriting process more efficient or help you guys cut costs or otherwise impact your business over the next three to five years. Sure, be happy to talk about that. We are very much involved as an executive team here and with our subsidiary companies at exploring all of the artificial intelligence tools that are available and ones that we might want to consider building ourselves. We just announced that we hired an artificial intelligence leader at the corporate holding company level that can help lead our Steve Cross. He is leading our artificial intelligence efforts.

It’s hard to talk about artificial intelligence without talking about data analytics because you really need the data analytics to go hand in hand with the artificial intelligence to put the artificial intelligence to work for you. As I commented in my opening comments, we’re making investments in technology. We’re making a concerted effort to retire our legacy IT debt. That’s the first step you’ve got to have in order to have data analytics, and then in turn from there leverage what’s available in artificial intelligence, you’ve got to have modern technology in place. We are investing in technology, we’re retiring our legacy technology debt, and we’re investing in data analytics here too. A couple years ago at the corporate level, we hired a data and analytics expert, and that expert, John Giangelo, works with our subsidiary companies on data analytics.

We’ve built out that team so that we have that data and analytics available, and then Steve Cross and his team can set on top of that what’s available from the artificial intelligence perspective. We think of it as an executive team in two ways. For the most part, artificial intelligence will help you make better decisions or it will help you be more efficient. We have numerous artificial intelligence projects we’re exploring, and one of the first categories is, is this an artificial intelligence project that’s going to help us with efficiency or is this an artificial intelligence project that’s going to help us with better decision making? We have several pilots in place, several that are helping us right now with better decision making, better efficiencies, and we have numerous in the pipeline. We’re building the data and analytics for that to sit on top of.

The data and analytics sits on top of modern IT technology, which is what we’re investing in. Thank you. Maybe one more if there’s time on the title insurance business. Do you think that you need to see mortgage rates fall before you start to see combined ratios getting back into the 96, 95 or below range, or do you think you can improve margins in the current housing environment? I’ll kick it off, Carolyn, and then let you add what you think. We are not satisfied with a combined ratio in title above 95. We realize that in a tight market like we’re in now with high interest rates, a very slow real estate market, that we’re going to be at the top end of that range. Carolyn and I have had this many discussions and we’re working very hard to bring our combined ratio down.

Assuming the same environment that exists today, we should be performing at a 95% combined ratio. There are things that we’re doing to look at where we’re spending money. I think an example of that is our decision to discontinue our focus on providing a closing platform because there are other partners and vendors that can provide very good closing platforms that our technology works well with. We don’t need to be the ones providing the closing platform. That’s an example of, you know, we’re looking to make sure we’re being as efficient as possible. Our hope for this year was that we would get below that 95% mark. Carolyn still has and her team still have aspirations to bring that down. We had the litigation expense we talked about earlier that drove up our combined ratio a couple points this quarter. Last year we finished at 97%.

This year, you know, it could be in that range, but our aspiration is to get it below 95%. Carolyn, is there anything you would add to that?

Carolyn Monroe, President and CEO of Old Republic National Title Holding Company, Old Republic International Corporation: No, just that absent of any kind of an increase in the market, we just continue to look inward to see what we could be doing at a more efficient level that will help us save money. We never stop doing that. Given the fact that we have to understand that this market we have right now might be what we have, we’ve just got to figure out what we could be doing different. We’re honestly looking at that every day. We don’t just depend on the market to get better, we depend on what we’re doing as well.

Craig Smiddy, President and CEO, Old Republic International Corporation: Thank you.

Conference Call Operator: We’ll take a follow-up from Greg Peters from Raymond James.

Craig Smiddy, President and CEO, Old Republic International Corporation: Hey, real quick.

If we go to the supplement on page two, I wanted to just give us what’s going on inside the small line home and auto warranty that seems to be growing quite nicely. The other question I have is just on the new business initiative. Cyber, I think is one of those initiatives and not hearing great things about the pricing conditions in that market. Maybe you could talk about those two areas. Thank you.

Sure, Greg, be happy to talk about both of those. On home and auto warranty, the majority of the growth that you see there is really all the growth that you see there is auto warranty. We have entered into several new relationships with key partners and we expect to continue to have the auto warranty business grow. The home warranty business is not growing. It’s very dependent on the real estate cycle. Those warranties that we write are typically sold in conjunction with a property purchase, a new home purchase. The real estate market interest rates have not helped our home warranty subsidiary grow. That will change. Just like in title, we know things will turn at some point, that’s why we’re diversified. Even in home and auto warranty, that’s why, okay, the real estate market is tough right now.

Let’s focus on building some new relationships that can help us grow our auto warranty business. That’s what’s going on there. On the cyber front, one of our new subsidiaries is cyber. Indeed, I’ve met with that team and one of the things I said to them is given that you’re a startup, the way that we handle startups is there’s no incentive to put premiums on the books in the short term, even variable compensation. We will, on a new startup, just say, listen, that’s going to be fixed for three years because we know it’s going to take time to grow. We don’t want you to grow too fast. We don’t want you to grow into a market that’s too competitive. We want to give you time. We focus on our definition of success as 10 years out.

When we look back, how does it look, not the first three years. In cyber, everything we hear from that team is that rates have come down over the last couple years. There is, I think, clear consensus indication that rates are at least flattening out. I read this morning from others that there’s indications of greater pricing discipline, greater underwriting discipline in the cyber arena. The discussion we’ve had with our cyber team is, listen, focus on building out your team. We know you’re going to be in expense load for the next couple, two to three years. Take your time, build it right, wait for the market.

Carolyn Monroe, President and CEO of Old Republic National Title Holding Company, Old Republic International Corporation: To.

Craig Smiddy, President and CEO, Old Republic International Corporation: For you to be certain that there’s price adequacy in the marketplace. Actually, the timing feels pretty good to us because if they wanted to write a lot of cyber insurance today, they couldn’t. They’re building it out. We don’t expect to write premiums until probably the beginning of next year. Even then, we’ll go slow, but we’ll be ready. There’s no incentive for them to put any premiums on the books until the timing is right. In the meantime, they’re just focused on building out that operation, and they have their sleeves rolled up and are working day and night to get it built so that when the market is right, we’ll be there for it. Makes sense.

Thanks for the answers.

Conference Call Operator: Once again, ladies and gentlemen, that is Star One. If you have a question today, we’ll pause for just a moment. At this time, there appear to be no further questions. I’d like to hand the call back to management for any additional or closing remarks.

Craig Smiddy, President and CEO, Old Republic International Corporation: Okay. We appreciate all the questions and engagement. Sometimes our August conference call is a little slower, given people are on vacations and enjoying summer. We wish everyone the best. Enjoy the rest of your summer and again, appreciate your interest in Old Republic International Corporation. We’ll be back next quarter to let you know how things are going.

Frank Sodaro, Chief Financial Officer, Old Republic International Corporation: So.

Craig Smiddy, President and CEO, Old Republic International Corporation: By the way, there’s the siren in the background if Greg Peters is still listening. All right, thank you very much.

Conference Call Operator: That does conclude today’s conference. We would like to thank you all for your participation today. You may now disconnect.

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