In my view, one of the most intriguing aspects of last week’s NYSSA Insurance Conference was hearing the managements of three different companies (out of 16) give largely “philosophical” rather than “data-driven” presentations. I believe insurance-sector investor communications teams should evaluate whether this approach could be appropriate for their situation.
Alphabetically, with links to the webcasts of each company’s NYSSA presentation, I am referring to:
- Infinity Property and Casualty Corporation (NASDAQ:IPCC)
- ProAssurance Corp. (NYSE:PRA)
- RLI Corp. (NYSE:RLI)
(Note: InsuranceIR does not have a business relationship with any of these companies.)
While there were distinct differences between the three presentations, they shared a number of common attributes:
- Speaking style was conversational. As a listener, I felt that narratives were being shared about how these managements view their business and what they deem to be integral to the success of those businesses.
- Very little of the time was spent on a detailed review of historic performance or “to-the-decimal” business metrics. As a listener, I appreciated that the speakers were not reciting information readily available in print or electronic materials (although data was used appropriately to support key contentions).
- Projected slides were heavy on concept and light on “detail.” As a viewer, I was not distracted by cluttered slides projecting complex data in type too small to be read.
- The audience was paying attention. During these presentations, the iPhones, iPads and Blackberries had not disappeared, but I felt that a higher-than-normal portion of the audience kept their eyes on the speakers and off their “devices.”
Full Disclosure Not Misdirection
I believe investors would agree that the success of this presentation style is largely predicated on another important attribute – consistent availability of complete, transparent disclosures of the details otherwise un-discussed in a “philosophical” presentation.
Based on a brief review of the companies’ respective websites, IPCC, PRA and RLI all appear to provide financial supplements and/or supporting presentation handouts that offer operating metrics and other financial details in sufficient depth to meet investor needs, and they appear to provide that data routinely.
Considering the Opportunity to Adapt the Investor Presentation
Investors across all sectors appreciate managements that are willing to devote time to outreach. But accessibility alone only goes so far. In my experience, investors vastly prefer conference presentations that go beyond “reviewing the business,” and instead help them assess a company’s management team and give them insight into:
- What sets a company apart
- Its competitive advantages
- Its operating strategies
- Management’s view of the company’s potential
To accomplish these objectives, companies may need to rethink the approach used for their presentations. I believe the philosophy-based presentations given by IPCC, PRA and RLI at the NYSSA Insurance Conference were compelling examples of one viable alternative style.