And most of that is driven by the things we talked about today, which are the profitability actions in insurance, which is driving really strong run rate profitability in that insurance business. Again, that’s the $45 million year-over-year that we saw in the second half of 2023 as well as the price increases and more of the cost management items rolling through in 2024. So, those are the main drivers of those as opposed to like the Aon or other things like that. The Aon just as – it will be over a period of time, because that’s a long-term agreement we have with our partners at Aon.
Danny Pfeiffer: Got it. Thanks.
Matt Ehrlichman: Thank you.
Operator: Your next question comes from the line of Ryan Tomasello from KBW. Your line is open.
Ryan Tomasello: Hi, everyone. Thanks for taking the questions. Just following up on the capital structure, Shawn, maybe if you could just discuss some of the path you have to efficiently addressing the 2026 convert maturity. Obviously, you bought back a little bit here at a discount. Is that something that you will continue to opportunistically chip away at? And also just remind us, from a corporate structure perspective, if you would have any access to the sizable chunk of liquidity at HOA to help with those maturities depending on how the reciprocal evolves, just trying to understand all the moving pieces here for the capital structure? Thanks.
Shawn Tabak: Yes. Thanks for the question. So I would say, first of all, as I mentioned, we ended the year in a strong position with about $400 million of cash, cash equivalents and investments. Within that, there was also a roughly $50 million surplus note between HOA and Porch Group. That provides the coupon and an intercompany payable back to Porch Group. The other thing, obviously, we just talked about Aon and EIG, those deals collectively contributed an additional $35 million of cash in January of 2024 that we will see on the Q1 ‘24 balance sheet. So I think – and then finally, I guess the last point there is that HOA is in a really healthy position with $52 million of surplus at the end of 2023. So – and then we talked about generating adjusted EBITDA and profitability actions in 2024.
So, that’s also driving it north going forward. With respect to taking care of the debt, I am not going to get into any specifics. I think what I would just say is I’ll leave it at. We have a number of options in how to take care of that and we – sitting here today, we have over 2 years to do that. So, plenty of time on our side there as well.
Ryan Tomasello: Okay, great. Thanks for that color. And then in terms of the ‘24 guide just given all the noise this year – the past year from Vesttoo and lower seating on revenue in the back half, you have the resale of the insurance – the sale of the insurance agency this year, just trying to understand like what level of organic revenue growth the 2024 guidance implies as we kind of normalize for those different factors if that makes sense?
Shawn Tabak: Yes. I mean it’s all – I would label it is all organic. I mean I think with what we are doing with our insurance book, where we are seating less quota share, in particular, quota share is the element of reinsurance that we’ve cut back on. And we are able to do that, because we have significantly increased the profitability of the book. So, I mentioned the risk, which is the probable maximum loss of the insurance for it. We will have gotten better by 50% and collectively almost between 2022 and 2024. And that, along with the profitability actions go hand in hand and that’s what puts us in a position where we could have less quota share reinsurance in the book. And that will continue to some extent in 2024 as well as the price increases that we mentioned, the premium per policy increases.
So, that’s how I would think about it. I think it’s all the levers kind of come together when we are thinking about the insurance business and the profitability and what that means in terms of reinsurance as well.
Ryan Tomasello: Got it. Thanks for taking the questions.
Matt Ehrlichman: Thank you.
Operator: Your next question comes from the line of Jason Kreyer from Craig-Hallum. Your line is open.
Jason Kreyer: Great. Thank you, guys. I just wanted to ask on property data. I know you have been using that for the last 2 years now. Just wondering if you can give an overview of where you have seen that data provide more of a pricing edge or any numbers around how frequently that data is being used in quoting? And then if you can give any indications of where you plan to use that more going forward? Thank you.
Jim Weld: Sure. I can take that. We are excited about the advantages of the data can provide and we are already seeing measurable results in our own underwriting and it’s going to be a key ongoing opportunity for us. There is a variety actually of ways that we can use the data. We have actually done a number of filings in multiple states using the data. And it’s things that you would expect if you were to start to imagine what would you want to know, right? So it’s things tied to the age and condition of the roof, it’s tied to the type of plumbing. It’s tied to where is the water heater located so that in the event something happened, what type of damage is going to take place. We think we are early in our ability to take advantage of this data. There is still a lot of data points that we think we can get about the interior of the home and we are excited about them.
Operator: And we have run out of time for our question-and-answer period. I will now pass the call over to Matt for closing remarks.
Matt Ehrlichman: Well, first, thanks everybody for the questions and the time. Thanks everybody for being here. Most I just want to thank the Porch team for their efforts and for the truly significant progress that’s been delivered, also to our long-term investors who do see the vision and where we are and all that’s ahead for us. We look forward to speaking to you all – with you all again in our Q1 earnings in May until then.
