INVESTOR PRESENTATION
MARCH 2018
Fulfilling the Unique Needs
of Specialty Insurance Markets
as a Long-Term Partner
1
SAFE HARBOR STATEMENT
This presentation contains “forward-looking” statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended,
that are based on our management’s beliefs and assumptions and on information currently available to
management. These forward-looking statements include, without limitation, statements regarding our
industry, business strategy, plans, goals and expectations concerning our market position, product
expansion, future operations, margins, profitability, future efficiencies, and other financial and operating
information. When used in this discussion, the words “may,” “believes,” “intends,” “seeks,” “anticipates,”
“plans,” “estimates,” “expects,” “should,” “assumes,” “continues,” “potential,” “could,” “will,” “future” and the
negative of these or similar terms and phrases are intended to identify forward-looking statements.
Forward-looking statements involve known and unknown risks, uncertainties, inherent risks and other
factors that may cause our actual results, performance or achievements to be materially different from any
future results, performance or achievements expressed or implied by the forward-looking statements.
Forward-looking statements represent our management’s beliefs and assumptions only as of the date of
this presentation. Our actual future results may be materially different from what we expect due to factors
largely outside our control, including the occurrence of severe weather conditions and other catastrophes,
the cyclical nature of the insurance industry, future actions by regulators, our ability to obtain reinsurance
coverage at reasonable rates and the effects of competition. These and other risks and uncertainties
associated with our business are described under the heading “Risk Factors” in our most recently filed
Annual Report on Form 10-K, which should be read in conjunction with this presentation. The company
and subsidiaries operate in a dynamic business environment, and therefore the risks identified are not
meant to be exhaustive. Risk factors change and new risks emerge frequently. Except as required by law,
we assume no obligation to update these forward-looking statements publicly, or to update the reasons
actual results could differ materially from those anticipated in the forward-looking statements, even if new
information becomes available in the future.
1
2
THE CONIFER “CREATION STORY”
COMPANY HISTORY
2008
North Pointe
(founded by
Conifer founder
Jim Petcoff)
sold to QBE for
$146 million, or
approximately
1.7X book value
2012
Non-compete
agreements expire
and Conifer starts
writing old NP
business, bringing
together successful
executives with
new, state-of-the-
art processing
systems
August 2015
Conifer completes
IPO on Nasdaq,
further expands
as a specialty
niche writer of
P&C products
2015
Company makes
strategic decision to
slow growth in
homeowners
product in Florida;
Commences new
specialty products
in security guards
and low-value
dwelling with
historically strong
loss ratios
2016
Conifer continues to
lessen exposure to
Florida market;
Ramps up new lines;
reports favorable
underwriting trends
in new lines
2017
Conifer executes
ADC to address
reserve
development.
Lower expense ratio
and focus on
enhancing
underwriting profit
in core specialty
commercial lines
Leveraging past experience, Conifer’s management is creating a diverse, specialty writer
of commercial and personal lines business.
By integrating new technology and processes, the Company believes it can achieve
higher returns than those achieved in its former business.
3
CONIFER: AT A GLANCE
Exchange / Ticker Nasdaq: CNFR
Share Price (at 3/1/2018): $ 6.05
Shares Outstanding*: 8.5M
Market Capitalization: $ 68M
GAAP Equity*: $ 52.8M
Book Value per Share*: $ 6.20
Conifer Holdings, Inc.
Conifer
Insurance Company
MI Domicile
A.M. Best: B++
Demotech: A
White Pine
Insurance Company
MI Domicile
A.M. Best: B+
Demotech: A
Sycamore
Insurance Agency
MI Domicile
A.M. Best: NR
Demotech: NR
ANALYST COVERAGE
TOP HOLDERS
Name/Firm Shares
James Petcoff (CEO) 2,406,664
Strength Capital Partners, LLC 733,799
Aegis Financial Corporation 686,614
Clarkston Ventures, LLC 660,976
NorthPointe Capital, LLC 534,955
Eidelman Virant Capital 390,167
Name Firm
Bob Farnam Boenning & Scattergood
Paul Newsome Sandler O’Neil
Greg Peters Raymond James
*as of 12/31/2017
4
BROAD & FLEXIBLE UNDERWRITING PLATFORM
• Well-developed underwriting platform overall
• Ability to pivot between Excess & Surplus lines and Admitted opportunities
• Writing policies in all 50 states
• Goal is to be licensed on both E&S and Admitted basis in all 50 states
5
INVESTMENT THESIS: WHY CONIFER?
• Leveraging knowledge in specialty niches - (hospitality /
security guards / low-value dwellings, e.g.) to achieve
market leading positions
• Management has built a similar model successfully at a
previous company, which it sold for 1.7X book in 2008.
• Strengthened reserves throughout 2017 and implemented
adverse development cover for additional protection while
continuing to ramp up business to sufficient scale
• Expects profitability in 2018; ramping up premium in core
lines of business; and continued declining expense ratio
• As of 12/31/17, book value per share of $6.20
• Deferred tax assets (with 100% valuation allowance) of
$9.9 million or $1.16 per share – not reflected in current
book value
6
BUSINESS MIX: GRADUAL SHIFT TOWARD COMMERCIAL LINES
6
2017 – Roughly 80% Commercial / 20% Personal
2018 – Commercial will continue to grow as a percentage as the Company scales back personal lines.
GROSS WRITTEN PREMIUM FOR 2017 GROSS WRITTEN PREMIUM FOR Q4 2017
COMMERCIAL LINES OVERVIEW – SOLID SPECIALIST DRIVEN GROWTH
7
$12.9 $12.7
$12.6 $13.2
$0
$5
$10
$15
$20
$25
$30
Q4 2016 Q4 2017
M
I
L
L
I
O
N
S
Hospitality Small Business
• Commercial Lines represented roughly 83% of the premium
written in the fourth quarter – and was 80% for 2017 as a whole
• Quarter over quarter, Commercial gross written premium was up 1.3% in Q4 2017
• Conifer continues to write Commercial Lines in all 50 states
GROSS WRITTEN PREMIUM
As of December 31, 2017
Top Five States
GROSS WRITTEN PREMIUM
$ in thousands
Michigan $ 21,099 22.9%
Florida 19,763 21.5%
Pennsylvania 8,651 9.4%
Texas 5,918 6.4%
New Jersey 3,960 4.3%
All Other 32,721 35.5%
Total $ 92,112 100.0%
EXPERTS IN NICHE MARKETS
8
LINES OF BUSINESS
• General Liability
• Property
• Liquor Liability
• Workers Compensation
• Umbrella
• Equipment Breakdown
• Specialized Property Enhancement Forms Available
Preferred Classes of Business
• Family Restaurants
• Pizza/Sub Shops
• Delis
• Bakeries
• Brew Pubs
• Bars/Taverns
• Wineries
• Micro-Breweries and Craft Beer & Wine Shops
• Convenience Stores
• Fraternal Organizations
EXAMPLE: RESTAURANTS, BARS AND TAVERNS
Conifer has had ties to the
Hospitality Industry since
the late 1980s, providing
coverage and peace of mind
for proprietors.
PERSONAL LINES OVERVIEW
9
$3.4 $3.2
$2.4
$2.2
$0
$1
$2
$3
$4
$5
$6
$7
Q4 2016 Q4 2017
M
I
L
L
I
O
N
S
Wind-Exposed Low-Value Dwelling
• Personal Lines production was approximately 17% of total premium in Q4 2017
• Net earned premium in personal lines declined almost 20% in the fourth quarter
• Planned decrease in wind-exposed homeowners, specifically Florida homeowners, which was down 16% in Q4
• Florida assumption business started non-renewing February 9th
• Continuing efforts to reduce wind exposure overall
As of December 31, 2017
Top Five States
GROSS WRITTEN PREMIUM
$ in thousands
Texas $ 6,992 31.5%
Florida 6,800 30.7%
Hawaii 4,764 21.5%
Indiana 2,612 11.8%
Illinois 621 2.8%
All Other 383 1.7%
Total 22,172 100.0%
GROSS WRITTEN PREMIUM
7% decrease
$25.5 $25.9
$5.8 $5.4
$0
$5
$10
$15
$20
$25
$30
$35
Q4 2016 Q4 2017
M
I
L
L
I
O
N
S
Commercial Lines Personal Lines
Q4 2017 RESULTS OVERVIEW
Gross Written Premium:
• GWP was $31M in Q4, a 0.2% decrease from the
same period in 2016
Commercial Lines GWP increased 1.3% from
Q4 2016
• Quick Service Restaurants and
Liquor Liability business performed well
in the period
Personal Lines GWP decreased 6.8% from Q4 2016
• Florida homeowners was down 15.8%
• Low value dwelling was down 14.3%
Net Earned Premium increase:
• Overall NEP increase of 4% to $25M in Q4 2017
Commercial Lines NEP increased more than 10%
in Q4 2017
Personal Lines NEP decreased almost 20%,
consistent with planned shift in business mix
10
GROSS WRITTEN PREMIUM
11
45.3% 41.4%
73.4%
58.3%
Q4 2016 Q4 2017
RESULTS OVERVIEW: COMBINED RATIO
• Continued focus on core commercial lines will help drive overall combined ratio improvement
83% of total premiums in Q4 were from our core commercial business
Focus on more profitable personal lines such as low value dwelling products
118.7%
99.7%
19 percentage point
improvement
12
62.7%
74.0%
Q4 2016 Q4 2017
PERSONAL LINES
RESULTS OVERVIEW: Q4 2017 LOSS RATIO
• Consolidated loss ratio improved by 15.1 percentage points from Q4 2016
• For Q4 2017, Commercial Lines loss ratio was 55.3% and Personal Lines was 74.0%
• On going planned trend of shifting away from wind-exposed Personal Lines premium
• Continued focus on core solid performing Commercial Lines
76.4%
55.3%
Q4 2016 Q4 2017
COMMERCIAL LINES
73.4%
58.3%
Q4 2016 Q4 2017
CONSOLIDATED
13
RESULTS OVERVIEW: Q4 2017 EXPENSE RATIO
54.1%
49.8%
48.0%
46.3%
45.3%
44.9%
43.4%
42.9%
41.4%
Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017* Q4 2017
• Continued sequential expense ratio improvement - quarter to quarter
• Almost 1,300 basis point improvement overall since Q4 2015
• Downward expense trend reflects commitment to streamlining on all levels
1270 basis point
reduction
*before impact of ADC and Q3 2017 hurricane activity
14
CONSERVATIVE INVESTMENT STRATEGY
• Maintain a highly liquid portfolio of
investment grade fixed income securities
• Total cash & investment securities of
$170.3M at December 31, 2017:
Average duration: 3 years
Average tax-equivalent yield: ~2.5%
Average credit quality: AA
FIXED INCOME PORTFOLIO
CREDIT RATING
$ in thousands December 31, 2017
Fair Value % of Total
AAA $ 34,680 25.4%
AA 62,397 45.7%
A 25,123 18.4%
BBB 13,107 9.6%
BB 1,229 0.9%
NR -- --
TOTAL
FIXED INCOME
INVESTMENTS
$ 136,536 100.0%
PORTFOLIO ALLOCATION
U.S. Government
Obligations
11.6%
State & Local
Governments
11.9%
Corporate Debt
26.5%
MBS
22.8%
CMO / RMBS
1.7%
ABS
16.0%
CMBS
2.4% Equity
Securities
7.1%
15
Significantly Improved Combined Ratio Driven by Strong Underwriting Performance
Q4 2017: Return to Profitability Validates Initiatives Implemented in Q3 2017
Maintain Focus on Writing Core Lines of Specialty Niche Business
Balance Sheet Remains Well Positioned to Support Companies
2018: Drive Positive Bottom Line
CONIFER: STATE OF THE BUSINESS
15
APPENDIX
17
FINANCIAL RESULTS: CHI CONSOLIDATED BALANCE SHEET
SUMMARY BALANCE SHEET
$ in thousands
December 31, 2017 December 31, 2016
Cash and invested assets $ 170,343 $ 141,023
Reinsurance recoverables 24,539 7,498
Goodwill and intangible assets 987 1,007
Total assets $ 239,032 $ 203,701
Unpaid losses and loss adjustment expenses 87,896 54,651
Unearned premiums 57,672 58,126
Senior debt 29,027 17,750
Total Liabilities $ 186,206 $ 135,907
Total Shareholders' Equity $ 52,826 $ 67,794
18
FINANCIAL RESULTS: Q4 2017 INCOME STATEMENT
• Company reported net income of $0.2 million, or $0.03 per share for Q4 2017
• $1.16 per share for valuation allowance against deferred tax assets not reflected in book value
• Book value per share of $6.20, or $52.8 million of shareholders’ equity
Three Months Ended
December 31,
($ in thousands, except per share data) 2017 2016
Gross Written Premium $31,247 $31,308
Net Written Premium 27,439 27,069
Net Earned Premium 25,433 24,463
Net Income (Loss) 221 (4,421)
EPS, Basic and Diluted $0.03 $(0.58)
Adjusted Operating Income (Loss) 161 (4,279)
Adjusted Operating Income (Loss) per share $0.02 $(0.56)
18
19
Q3 2017 BALANCE SHEET STRENGTHENING
ADVERSE DEVELOPMENT COVERAGE PURCHASE
COVERAGE AMOUNT: $19,500,000 xs $38,050,000 ($17,550,000 after co-participation)
COVERAGE YEARS: Accident dates from January 1, 2005 through December 31, 2016,
paid subsequent to June 30, 2017
PREMIUM: $7,200,000
CO-PARTICIPATION: 10% of development retained
PROFIT SHARING: 35% profit commission paid at commutation
SUBORDINATED DEBT PLACEMENT
ISSUER: Conifer Holdings, Inc.
INVESTOR: Affiliates of Elanus Capital Management, LLC
DEAL SIZE: $30 million in subordinated notes
MATURITY: September 29, 2032 (15 Years)
ANNUAL INTEREST RATE: 8.0% Fixed
INTEREST DEFERRAL PERIOD: Up to four quarters
ISSUER CALL OPTIONS: 100% of par from July 31, 2018 through October 31, 2018;
105% of par after September 29, 2020
COMMON EQUITY PRIVATE PLACEMENT
ISSUER: Conifer Holdings, Inc.
INVESTORS: Officers & Directors of the Company
DEAL SIZE: $5.0 million in common equity
ISSUE PRICE: $6.25 per share
20
REINSURANCE: PRUDENT RISK MANAGEMENT TO PROTECT CAPITAL
• Retain first $500,000 of each
specific loss/risk
Reinsurance coverage in
excess of $500,000 up to
policy limits
• Catastrophe (CAT)
reinsurance program provides
$110M of protection
All providers are rated
minimum A-
Net retention of $4M for
first event
CIC / WPIC
Specific Loss Reinsurance Treaties
Effective 01/01/2018 to 01/01/2019
CIC / WPIC
Property-CAT Reinsurance Treaties
All layers 06/01/2017 to 06/01/2018
$110,000,000
$4,000,000
$20,000,000
$60,000,000
Retention
$2,000,000
$20,000,000
$1,000,000
$10,000,000
$500,000
First
Casualty
Clash XOL
($8M xs $2M)
Retention
Second
Casualty
Clash XOL
($10M xs $10M)
First Multi-Line
Excess of Loss
($500K xs $500K)
Second Multi-Line
Excess of Loss
($1M xs $1M)
Property
Per Risk
($2M xs $2M)
$300,000
Property
Per Risk
$2,000,000
21
REINSURANCE: PRUDENT RISK MANAGEMENT TO PROTECT CAPITAL
Commercial Property Per Risk
Reinsurance Treaty
Effective 01/01/18 to 01/01/19
Homeowners Property Per Risk
Reinsurance Treaty
Effective 01/01/18 to 01/01/19
$300,000
Retention
Property
$3,000,000
$2,000,000
$500,000
$1,000,000
Retention
Multi-Line
XOL
Property Per
Risk
Multi-Line
XOL
$4,000,000
$300,000
Property
Per Risk
