Kathy Antonello: Yes. It is larger. In fact we’ve seen our average policy size increasing quite a bit since we entered into the appetite expansion. Of course some of that is coming from just the economic growth that I’ve talked about in the past with higher employment levels and wages increasing and so forth. But we have seen our average policy size for our in-force book go from about 5,200 to about 5,500 over the course of the last year or so. So it is increasing.
Bob Farnam: Is that largely attributed to the expansion classes? Or is that like you said just kind of more of size of the payroll base going up in all year.
Kathy Antonello: I would say it’s both Bob. It’s not – it’s both the increasing wages and our appetite expansion effort.
Bob Farnam: Okay. All right. A quick question on Cerity. I understand you’re rolling – you’re trying to consolidate Cerity into the Employers platform. It sounds like you expect that to be pretty much done in 2024. Is that what your expectations are?
Kathy Antonello: Yes. We expect to have a lot of the work done in 2023 and to start experiencing the benefits of that from an expense standpoint in 2024.
Bob Farnam: Okay. So starting in the first quarter of 2024. Do you think you will have some of the expense savings there?
Kathy Antonello: It will roll in throughout the year. But yes, we should start to see some in the first quarter of 2024.
Bob Farnam: Okay. Great. Thanks. And one quick question for Mike. The FHLB strategy. Are we expecting that to be completely unwound in the fourth quarter this year? That’s kind of what I was expecting but I didn’t know if there was any update to that.
Mike Paquette: Hard to tell, Bob. We’re down to $40 million right now. And we still are seeing an adequate spread between the borrowing rate and what we’re earning on the asset. We just have to watch it for liquidity and credit and if it maintains that adequate spread we’ll keep it through year-end. If not we’ll take that trade off the table. So it’s a little hard to tell and the investment market right now is a little wild. So we watch it every day and we’ll act accordingly.
Bob Farnam: Okay. Great. Thanks for your interest.
Kathy Antonello: Thanks, Bob.
Operator: There are no further questions in the queue. I’d like to hand the call back to Ms. Antonello for closing remarks.
Kathy Antonello: Okay. Thank you, Doug. And thank you all for joining us this morning. We look forward to meeting with you again in February of 2024.
Operator: Ladies and gentlemen, this does conclude today’s teleconference. Thank you for your participation. You may disconnect your lines at this time and have a wonderful day.
