Kinsale Capital Group Reports Significant Q1 Profit Increase Amid Market Pressures

Kinsale Capital Group, a specialty underwriter headquartered in Richmond, Virginia, reported a significant increase in first-quarter profits amid competitive pressures in its property business. For the quarter ending in March, Kinsale saw earnings of $112.6 million, or $4.88 per diluted share, an impressive rise from the previous year's $89.2 million, or $3.83 per share. The 27.4% increase in diluted earnings per share and a 37.7% boost in operating earnings to $5.11 highlight the company's robust financial performance.

This positive outcome was primarily driven by a quarter with minimal catastrophe losses, totaling only $1.3 million compared to last year's $17.8 million. Over the past year, the company achieved a net income of $503.6 million, maintained a combined ratio of 75.9%, and recorded a 26.4% operating return on equity. As a result, the board increased the dividend by 47.1% to $0.25 per share, alongside a $250 million buyback announced last December.

Kinsale experienced a slight decline of 0.5% in gross written premiums, amounting to $482.0 million, mainly due to a 28.3% decrease in its Commercial Property Division. Excluding the property segment, premiums rose by 6.0%. The company increased its net written premiums by 5.6% to $403.3 million, following a strategic choice to retain more risk in the June 2025 reinsurance renewal period.

The quarter also saw a rise in underwriting income to $94.5 million from $67.5 million, improving the combined ratio to 77.4% from 82.1%. A decrease in the loss ratio to 56.3% was offset by a slight increase in the expense ratio to 21.1% due to lower ceding commissions. Favorable reserve development from previous years contributed an additional $18.7 million, and investment income surged by 26.5% to $55.4 million.

Kinsale's reduction in its property business aligns with industry trends, as reported by S&P Global Market Intelligence. E&S commercial property premiums fell by 2.8% to $27.7 billion in 2025, the first annual decrease since 2017, caused by heightened competition from both admitted and non-admitted insurers. Industry players like CRC Group noted rate decreases of 20% to 30% on catastrophe-prone wind accounts due to an influx of capital and easing reinsurance pricing.

Similarly, RLI Corp. posted a combined ratio of 86.0%, up from 82.3%, alongside a 9% reduction in property premiums. Michael Kehoe, Kinsale's chairman and CEO, emphasized the quarter's "exceptional profitability," crediting strict underwriting and a low-cost structure. He reinforced the company's commitment to delivering long-term stockholder value by maintaining underwriting profits and prudently managing capital amid soft market conditions.