RLI Corporation's 30-Year Underwriting Profit Streak Reflects Strategic Focus

RLI Corporation has achieved an impressive 30-year streak of underwriting profits, as highlighted by CEO Craig Kliethermes in a recent earnings call. In 2025, the insurer reported an underwriting income of $264.2 million, reflecting a combined ratio of 83.6. This success underscores RLI's strategic focus on disciplined execution and regulatory compliance requirements to sustain long-term profitability in a competitive market environment.

Kliethermes highlighted that while premium growth was modest at 1% on a net basis, RLI's strengths lie in deliberate, strategic operations rather than aggressive expansion. He quoted company founder Gerald Stephens: “You don’t win the long game by swinging at every pitch.” The evolution of RLI’s business is evident, with gross premiums written in 2025 reaching $2.1 billion, significantly more than the $270 million reported 30 years prior. This growth includes a strategic focus on E&S property and marine insurance, essential components of their risk management strategy.

Competitiveness in the Market

Chief Operating Officer Jen Klobnak provided further insights, noting an 11% decline in fourth-quarter property premiums due to a highly competitive E&S property market. Despite this, the segment maintained a strong combined ratio of 49, showcasing RLI's robust portfolio quality. Klobnak observed that while some carriers adjust regulatory terms and conditions, MGAs aggressively pursue market share.

Addressing Market Fluctuations

Klobnak responded to potential impacts of major catastrophes on market pricing, suggesting that changes in underwriting focus could stabilize the market. Although competition remains fierce, RLI remains selective, emphasizing areas where it can leverage its strengths effectively. In addressing the casualty and surety markets, high combined ratios prompted Kliethermes to affirm ongoing rate increases, especially in the auto insurance line, until loss severity pressures diminish. The firm's cautious reserve management reflects their commitment to regulatory compliance and sustained profitability.

Conclusively, Kliethermes and Klobnak underscored RLI's commitment to strategic growth supported by disciplined underwriting practices. These efforts position the company to navigate industry fluctuations and maintain its competitive edge in an evolving insurance landscape.