DEF 14A: AXIS Capital Aims for Specialty Underwriting Leadership: Board Welcomes New Director, Announces Share Buyback

• AXIS Capital's proxy statement highlights the company's strategic advancements in 2023, aiming to become a leading specialty underwriter.
• The company achieved record production in its Insurance segment and repositioned its Reinsurance segment for consistent profitability.
• AXIS launched the 'How We Work' program to enhance organizational agility and efficiency.
• The company returned $153 million to shareholders through dividends and authorized a $100 million share buyback in December 2023.
• Stan Galanski joined the Board in January 2024, bringing extensive insurance industry experience.
• The company is committed to fostering a positive workplace environment with a focus on diversity, inclusion, and equity.
• AXIS aims to consistently generate double-digit operating return on average common equity (OROACE), combined ratios in the low 90s, profitable growth, and book value per share growth.
• The 2023 results included a net reserve strengthening of $425 million pre-tax in the fourth quarter, predominantly related to 2019 and older accident years.
• In 2023, AXIS generated net income of $346 million, operating income of $486 million, return on average common equity of 7.9%, and operating return on average common equity of 11%.
• Excluding the reserve strengthening, the operating return on average common equity was 18.5%.
• Gross premiums written reached a record $8.4 billion, and net investment income was also a record $612 million.
• The current accident year combined ratio improved to 91.8%, a 4.5 point year-over-year improvement.
• The Insurance segment's combined ratio for 2023 was 92.5%, including 5.1% of net adverse prior year reserve development and 3.2% of catastrophe and weather-related losses.
• The Reinsurance segment is now a $2.2 billion portfolio, with a combined ratio of 107.6%, including 14.6% of net reserve strengthening.
• AXIS partnered with Stone Point Credit to launch Monarch Point Re, a collateralized reinsurer in Bermuda.
• The company closed the first 144A cyber catastrophe bond, Long Walk Re, providing subsidiaries with fully collateralized indemnity reinsurance protection.
• AXIS is committed to a 50% absolute reduction of Scope 1 and 2 greenhouse gas (GHG) emissions by 2030, using a 2019 baseline.
• The company aims to achieve overall global gender parity in all levels of its workforce and to increase diversity within its senior leadership by 2025.
• The Annual General Meeting of Shareholders will be held on May 16, 2024.

Score: 8

Explanation: The document conveys a positive outlook, highlighting strategic progress, strong financial results, and commitment to corporate social responsibility. The tone is optimistic and confident, reflecting management's belief in the company's future prospects.

• Record production in the Insurance segment indicates strong business growth.
• The $100 million share buyback authorization suggests confidence in the company's financial health and future prospects.
• The addition of Stan Galanski to the Board brings valuable industry expertise.
• Strong underlying profitability and capital position enabled AXIS to return $153 million to shareholders during the past year via dividends on our common stock.
• The improvement in the current accident year combined ratio to 91.8% demonstrates enhanced underwriting performance.
• The commitment to reducing greenhouse gas emissions and promoting diversity reflects a focus on corporate social responsibility.

• The Reinsurance segment's combined ratio of 107.6% indicates underwriting losses in that segment.
• The 2023 results included a net reserve strengthening of $425 million pre-tax in the fourth quarter, predominantly related to 2019 and older accident years.

• Economic and social inflation trends impacting the overall U.S. Casualty market could pose challenges.
• Climate-related risks and the transition to a low-carbon economy require careful management.
• Failure to achieve diversity and inclusion goals could negatively impact the company's reputation and talent pool.

AXIS believes it is on a clear trajectory to becoming a specialty underwriting leader, aiming for double-digit OROACE, combined ratios in the low 90s, consistent profitable growth, and book value per share growth.

• Vince Tizzio, CEO, stated that the past year was transformative for the company, with tremendous progress toward becoming a specialty underwriting leader.
• Management believes the company is on a clear trajectory to becoming a specialty underwriter that consistently generates double-digit , combined ratios in the low 90s, consistent profitable growth, and book value per share growth.

The announcement highlights AXIS Capital's efforts to position itself as a leader in the specialty insurance and reinsurance market, amid industry trends of consolidation, climate risk, and the need for digital transformation.

• The document mentions AXIS's Lloyd's specialty business, where it is recognized as a top ten leader and outperforming syndicate, suggesting a strong competitive position.
• The creation of AXIS Energy Resilience Syndicate 2050, the first-ever Lloyds syndicate to exclusively underwrite energy transition risks, positions AXIS as an innovator in the renewable energy sector.
• The partnership with Stone Point Credit to launch Monarch Point Re demonstrates a strategic approach to expanding specialty reinsurance capacity, similar to other major players in the reinsurance market.
• The closing of the first 144A cyber catastrophe bond, Long Walk Re, showcases AXIS's ability to develop innovative specialty solutions, comparable to other leading cyber insurance providers.

• Shareholders benefit from the company's strategic progress, share buyback program, and commitment to increasing shareholder value.
• Employees benefit from the company's focus on diversity, equity, and inclusion, as well as its investment in talent development and well-being.
• Customers benefit from the company's tailored specialty solutions and exceptional service.
• Communities benefit from the company's corporate citizenship program, which focuses on protecting the planet, fostering inclusion, and investing in communities.

• The company will continue to execute against its strategy to deliver on its goals and achieve its financial ambitions.
• AXIS will leverage its voice and global platform to help address the mental health crisis and to improve awareness and education both within AXIS and throughout the industry.
• The company will continue to progress its DEI efforts through a formalized approach.
• AXIS will continue to monitor, assess and mitigate the environmental impact of our business, exposures and operations.

• The document discloses several related party transactions between AXIS and affiliates of Stone Point, a private equity firm where Charles Davis, an AXIS director, is the Chief Executive Officer.
• These transactions include investments in Stone Point's private equity funds, management of high yield debt portfolios by SKY Harbor Capital Management, and co-investments with Gordon Brothers and Rialto Real Estate Fund IV-Property.
• The Corporate Governance, Nominating and Social Responsibility Committee reviews these transactions to ensure they are no less favorable than those provided to other investors.

• 2019: Baseline year for Scope 1 and 2 greenhouse gas (GHG) emissions reduction target.
• 2020-06: W. Marston Becker appointed as Director
• 2020-01: Anne Melissa Dowling appointed as Director
• 2021-04: Axel Theis appointed as Director
• 2021-04: Michael Millegan appointed as Director
• 2023-05-04: Vincent Tizzio succeeded Albert Benchimol as President and Chief Executive Officer.
• 2023-12: Board authorized a $100 million share buyback.
• 2024-01: Stan Galanski joined the Board.
• 2024-04-04: Date of Board Chair and CEO Letters
• 2024-04-04: Important Notice Regarding the Availability of Proxy Materials for the Annual General Meeting to be held on May 16, 2024.
• 2024-05-16: Annual General Meeting of Shareholders.
• 2025: Goal to increase diversity within senior leadership.
• 2025: Next Say on Pay vote will occur.
• 2030: Target year for 50% absolute reduction of Scope 1 and 2 GHG emissions.