March 28, 2023

I am honored to be sending out my first annual letter as President & CEO of Millers Mutual. Since 1890, Millers has had only 12 Presidents, which I believe attests to the stability of the company. I will certainly strive to live up to my predecessors’ steadfast and long-term approach to insurance company management.

In many respects, 2022 was a good year for Millers. For the first time in company history, we underwrote over $100 million in premiums. To reach our total of $101.9 million, we grew premiums $11.9 million or 13.3% over the prior year. Our growth in recent years is reflective of the value we offer the multifamily housing market, as well as your efforts and those of our employees. Our net combined ratio came in at a 102.4, which on the surface may not appear stellar, but it is a good result considering the industry-wide impacts of inflation and catastrophe losses.

Millers continues to provide you and our multifamily housing clients outstanding service utilizing a mixed combination of on-site, remote, and hybrid staff. Our existing infrastructure’s ability to support such a workforce was proven during the early stages of the pandemic and continues to benefit us, as we secure new team members regardless of location. And in November 2022, we were once again named one of the Best Places to Work in PA.

While we reflect on 2022 as an overall successful year, we were faced with a few challenges. Inflation for one, has not spared the insurance industry, and we have seen the impacts of it on our claims costs. Millers’ approach to mitigating the impacts of inflation on our policyholders’ assets involved increasing our normal exposure/limit increase at renewal as opposed to simply increasing rates charged on exposure. This course of action was chosen to do our part to help our insureds maintain proper limits for their properties. We did our research and verified that our insureds could understand the increase considering the recent increase in the market value of their properties and the increases in the multifamily housing market’s rents. Our ability to focus on the multifamily housing market allowed us to do the right thing by our policyholders.

Additionally, the reinsurance market continued to harden due to unfavorable catastrophe results coupled with financial market contraction reducing reinsurers capacity to undertake risk. This led to the ending of reinsurance capacity at rates which had been more favorable to the primary insurers like Millers. Despite this challenging environment, Millers was able to fill out its reinsurance program for 2023 for the amount of reinsurance coverage we sought from the marketplace and at the pricing we took to the market. This successful execution means Millers continues to have the support of high-quality reinsurers as a backstop to protect our policyholders.

As we move forward, we will continue to be a niche-focused, stable commercial insurance carrier targeting the multifamily housing industry in the small business space. You can count on us to provide you the consistency your business demands and the confidence you can stake your relationships on now and in the future. On behalf of everyone at Millers, we express our collective thanks and gratitude to you, our agency partners. Together, we have accomplished much in 2022 and look forward to a prosperous 2023!

Best regards,

Jeffrey S. Pratt, President & CEO