ARCH CAPITAL GROUP LTD.
For the period ended Dec 31, 2025. Filed Feb 26, 2026.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Feb 26, 2026
ACGL$107.28-3.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-27.
0000947484-25-000017
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS“Comment on Non-GAAP Financial Measures.”“Financial Condition, Reinsurance Recoverables” “Financial Condition”“Capital Resources”“Contractual Obligations and Commercial Commitments”“Catastrophic Events and Severe Economic Events”Current report: 10-K
Period ended 2025-12-31; filed 2026-02-26.
0000947484-26-000017
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS“Comment on Non-GAAP Financial Measures.”“Financial Condition, Reinsurance Recoverables” “Financial Condition”“Capital Resources”“Contractual Obligations and Commercial Commitments”“Catastrophic Events and Severe Economic Events”The baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 314 previous paragraphs and 309 current paragraphs.
199 unchanged; 86 reworded; 13 added; 18 removed; 11 previous and 11 current paragraphs rearranged.
Tables are not compared: 51 previous and 51 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (13)
Current report
We reported very good results for 2025, with an annualized net income return on average common equity and operating return on average common equity of 20.1% and 17.1%, respectively. See “Comment on Non-GAAP Financial Measures.” Meaningful contributions from all three segments along with solid investment returns resulted in book value growth for 2025 of 22.6%. Our strong balance sheet and capital-generating capabilities permit us to both invest in our business and return capital to investors. During 2025, we repurchased $1.9 billion of Arch common shares.
Current report
As we head into 2026 with measured optimism and increased competition across our property and casualty businesses, our commitment to deliver long-term value for our shareholders remains unchanged. Critical to our cycle management is emphasizing risk selection, as we continue to leverage our diversified specialty platform and the expertise of our underwriting teams. We invest and use data and analytics to sharpen insights, enhance risk selection and deliver a differentiated customer experience while fostering a culture that attracts the best-in-class talent. We closed 2025 with a balance sheet in excellent health, giving us optionality as we remain prudent stewards of the capital entrusted to us by our shareholders.
Current report
Our insurance segment reported $375 million of underwriting income in 2025, with net premium written nearly $7.8 billion, an increase of 13.4% from 2024. Growth in net premiums written primarily resulted from the U.S MidCorp and Entertainment insurance businesses acquired from Allianz on August 1, 2024 (“MCE Acquisition”). The acquired business further expands our insurance platform, providing more opportunities to capitalize on attractive margins. Across the insurance platform, our underwriters continue to pursue growth in areas where risk-adjusted returns exceed or meet our long-term objectives. In North America, the casualty rate environment is largely keeping pace with loss cost trends, while pricing in our international business units is tracking slightly below loss trends. In North America, we continue to grow in specialty casualty lines, including alternative markets, construction and E&S casualty. Within each geography, consistent with our cycle management approach, we adjust our business mix in response to changing market conditions and pricing dynamics.
Current report
Our reinsurance segment contributed $1.6 billion of underwriting income in 2025. At the January 1, 2026 renewals, property catastrophe and more generally short-tail excess of loss renewals were highly competitive with rates down 10% to 20%. Despite these headwinds, our underwriting teams leveraged the strength of our platform and trading relationships to source new opportunities that mitigate the impact of the rate pressure in the market. We are growing selectively and focusing on areas where margins are attractive. We continue to like our prospects in most lines of business and, with improving conditions in casualty lines, our agility and ability to create opportunities is an advantage for us in this market. Our diversified reinsurance platform, supported by strong partnerships with brokers and cedants across multiple lines and geographies, further enhance our ability to navigate a competitive environment.
Current report
Total return for 2025 primarily reflected the effects of lower bond yields, a weaker U.S. dollar and equity market returns. The portfolio slightly underperformed their benchmark returns, primarily due to the impairment and sale of certain alternative investments accounted for using the equity method. The allocation of our portfolio remained neutral relative to our targeted benchmark. We continue to maintain a relatively short duration on our fixed income portfolio of 3.34 years at December 31, 2025.
Current report
Other underwriting income, which includes revenue earned from underwriting-related activities covered under existing service contracts, was $36 million in 2025, compared to nil in 2024.
Current report
Net premiums written by the reinsurance segment were 1.7% lower in 2025 than in 2024. The lower level of net premiums written primarily reflected non-renewals and share decreases in the specialty line of business offset, in part, by increases in casualty.
Current report
Other Underwriting Income (Loss).
Current report
Other underwriting income, which includes revenue earned from underwriting-related activities covered under existing service contracts was $159 million in 2025, compared to $9 million in 2024.
Current report
The underwriting expense ratio for the mortgage segment was 15.0% for 2025, compared to 17.0% for 2024. The decrease in the 2025 period primarily reflects a lower headcount as a result of the 2024 voluntary separation program.
Current report
(1) Amounts include dividends and other distributions on investment funds, term loan investments, funds held balances, cash balances and other items.
Current report
(2)Primarily in structured and corporates at December 31, 2025.
Current report
CATASTROPHIC AND SEVERE ECONOMIC EVENTS
Removed paragraphs (18)
Previous report
As we head into 2025, our objective to deliver long-term value for our shareholders remains the same. We will continue to execute on the key pillars of our strategy which are: to build a diversified mix of businesses; actively manage the underwriting cycle; remain prudent stewards of the capital entrusted to us by our shareholders; and be dynamic managers of a data-driven enterprise with a culture that attracts best-in-class talent. Book value per share, a key measure of value creation, ended 2024 at $53.11, representing a 13.1% increase for the year and up 23.8% after adjusting for the impact of the $5 per share special dividend paid to common shareholders in December 2024. The decision to pay a special dividend was the result of Arch's strong financial performance and capital position and represented an effective means of returning excess capital to our shareholders.
Previous report
Overall, we believe the property and casualty environment remains favorable, despite increasing competition in many of our lines of business. This makes underwriting and risk mitigation increasingly important. Our underwriting strategies empower our businesses to respond quickly to their trading environment. This has been, and remains, a competitive advantage as we have the agility and expertise to reallocate capital to more profitable opportunities across our diversified platform. We are selectively deploying capital to the areas producing attractive risk-adjusted returns, such as insurance and reinsurance liability lines, specialty business at Lloyd's and property catastrophe reinsurance.
Previous report
A high level of industry catastrophic losses throughout 2024, combined with the California wildfires at the start of 2025, should continue to support demand for property insurance and reinsurance. Notwithstanding this increased loss activity, we believe the property market remains attractive. On the casualty side, we believe that rates are continuing to outpace loss cost trends, and have selectively increased casualty writings in both our insurance and reinsurance segments.
Previous report
Our property and casualty underwriting teams continued to benefit from attractive market conditions, delivering a combined $1.6 billion of underwriting income and over $20 billion of gross premiums written in 2024, up nearly 19% from 2023.
Previous report
Our reinsurance segment contributed $1.2 billion of underwriting income in 2024, despite the impact of catastrophic events. At the January 1, 2025 renewals, we selectively increased our writings in property, liability and specialty lines with a focus not only on price adequacy, but also terms and conditions. Our underwriting culture dictates that we include a meaningful margin of safety in our pricing, especially given competitive market conditions, and take a longer term view of inflation and rates. As underwriting opportunities arise, our reinsurance segment reacts quickly and significantly when markets pivot.
Previous report
Our insurance segment also seized on strong growth opportunities in 2024, while elevated catastrophe activity such as Hurricanes Helene and Milton limited underwriting income. For the full year, the insurance group contributed $6.9 billion of net premium written, a 17% increase from 2023 and delivered $0.3 billion of underwriting income. On August 1, 2024, we completed the acquisition of the U.S. MidCorp and Entertainment insurance businesses from Allianz (“MCE Acquisition”). As such, the insurance segment’s 2024 results include five months of activity related to the acquired business. This acquisition expands our capabilities for insureds in the U.S. middle markets and represents an important component of our insurance segment. Excluding the MCE Acquisition, insurance growth was in the mid-single digits and included attractive opportunities in casualty, programs and in the London specialty market. Looking ahead, we expect primary market conditions to remain competitive given the attractive underlying margins, which may result in a slowdown of new business opportunities.
Previous report
Total return for 2024 primarily reflected the effects of sustained higher interest rates available in the market, along with growth in invested assets due in part to strong operating cash flows. We continue to maintain a relatively short duration on our fixed income portfolio of 3.31 years at December 31, 2024.
Previous report
In the 2023 fourth quarter, the Company established a net deferred income tax asset, resulting in a benefit of $1.18 billion, consistent with the transition provisions specified in the Bermuda CIT Act. Due to the non-recurring nature of this one-time item, the Company believes that excluding this item from after-tax operating income or loss available to common shareholders provides the user with a better evaluation of the Company’s ongoing business performance.
Previous report
Net premiums written by the reinsurance segment were 18.2% higher in 2024 than in 2023. The growth in net premiums written reflected increases in all lines of business, primarily due to new business, rate increases and growth in existing accounts.
Previous report
Other underwriting income in 2024 was $9 million, compared to $17 million in 2023.
Previous report
The underwriting expense ratio for the mortgage segment was 17.0% for 2024, compared to 18.2% for 2023. The decrease was primarily due to a lower level of profit commissions on U.S. primary business, along with a higher level of net premiums earned.
Previous report
(1) Includes interest income on operating cash, distributions from investment funds and other items.
Previous report
Seenote 15, “Income Taxes,” to our consolidated financial statements in Item 8 for a reconciliation of the difference between the provision for income taxes and the expected tax provision at the weighted average statutory tax rate for 2024 and 2023.
Previous report
(1) At December 31, 2024, 35.0% of total net reserves represent policy years 2014 and prior and the remainder from later policy years. At December 31, 2023, 31.0% of total net reserves represent policy years 2014 and prior and the remainder from later policy years.
Previous report
On June 3, 2024, we completed the acquisition of RMIC Companies, Inc., and its wholly-owned subsidiaries (“RMIC”) that, together, comprise the run-off mortgage insurance business of Old Republic International Corporation. The acquired business had been in runoff since 2011 and represented $3.6 billion of insurance in force at the time of the acquisition.
Previous report
On December 27, 2023 the Bermuda government enacted tax legislation referred to as the Corporate Income Tax Act 2023 (“Bermuda CIT Act”). The Bermuda CIT Act establishes a 15% corporate income tax, for in-scope businesses, for fiscal years beginning on or after January 1, 2025. The enacted legislation includes a provision referred to as the Economic Transition Adjustment, which requires Bermuda Constituent entities to establish tax basis in their assets and liabilities, excluding goodwill, based on fair value as of September 30, 2023. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
Previous report
Using fair value to establish tax basis in the assets and liabilities of our Bermuda entities results in deductible and taxable temporary differences which are reflected as deferred income tax assets and liabilities, respectively, in our financial statements. The enactment of Bermuda CIT Act resulted in the establishment of a $1.18 billion net deferred income tax asset. Such amount is included in ‘other assets’ on the Company’s balance sheet. In January 2025, the OECD issued administrative guidance introducing a new interpretation (with retroactive effect) for determining the treatment of deferred income tax assets and liabilities. Bermuda has not issued corresponding guidance. As of December 31, 2024, management’s estimate of the measurement of the deferred tax assets remains unchanged.
Previous report
(2)Primarily in corporate at December 31, 2024.
Reworded paragraphs (86)
Previous wording
Arch Capital Group Ltd. (“Arch Capital” and, together with its subsidiaries, “we” or “us”) is a publicly listed Bermuda exempted company with approximately $23.5 billion in capital at December 31, 2024 and is part of the S&P 500 index. Through operations in Bermuda, the United States, United Kingdom, Europe, Canada and Australia, we write specialty lines of property and casualty insurance and reinsurance, as well as mortgage insurance and reinsurance, on a worldwide basis. It is our belief that our underwriting platform, experienced management team and strong capital base enable us to establish a strong presence in the markets where we operate.
Current wording
Arch Capital Group Ltd. (“Arch Capital” and, together with its subsidiaries, “we” or “us”) is a publicly listed Bermuda exempted company with approximately $26.9 billion in capital at December 31, 2025 and is part of the S&P 500 index. Through operations in Bermuda, the United States, United Kingdom, Europe, Canada and Australia, we write specialty lines of property and casualty insurance and reinsurance, as well as mortgage insurance and reinsurance, on a worldwide basis. It is our belief that our underwriting platform, experienced management team and strong capital base enable us to establish a strong presence in the markets where we operate.
Previous wording
Our mortgage segment continued to deliver a steady level of earnings for our shareholders, generating $1.1 billion of underwriting income in 2024, resulting in the third consecutive year of delivering over $1 billion of underwriting income. While new originations remain tempered by relatively high mortgage interest rates, underlying fundamentals remained strong and our U.S. market share was stable as industry pricing discipline held. The persistency of our in force U.S. primary mortgage insurance portfolio remained a healthy 82.1% and the delinquency rate remained low.
Current wording
Our mortgage segment continued to deliver a steady level of earnings, generating $1.0 billion of underwriting income in 2025, resulting in the fourth consecutive year exceeding the $1 billion threshold. While lower mortgage rates are beginning to support increased origination activity, the current market is still constrained due to affordability challenges. Underlying fundamentals remained strong and our U.S. market share was stable as industry pricing discipline held. Our team remains focused on underwriting discipline, expense management and enhancing our data and analytical platforms to further optimize the business. The persistency of our in-force U.S. primary mortgage insurance portfolio remained a healthy 81.8% and our delinquency rate remained low. We continue to expect the mortgage segment to serve as a steady diversifying contributor to our overall earnings and generate attractive underwriting income given the high credit quality of our in-force portfolio.
Previous wording
Book value per share represents total common shareholders’ equity available to Arch divided by the number of common shares and common share equivalents outstanding. Management uses growth in book value per share as a key measure of the value generated for our common shareholders each period and believes that book value per share is the key driver of Arch Capital’s share price over time. Book value per share is impacted by, among other factors, our underwriting results, investment returns and share repurchase activity, which has an accretive or dilutive impact on book value per share depending on the purchase price. Book value per share was $53.11 at December 31, 2024, a 13.1% increase from $46.94 at December 31, 2023, and an increase of 23.8% when incorporating the impact of the $1.9 billion special dividend paid to common shareholders in December 2024.
Current wording
Book value per share represents total common shareholders’ equity available to Arch divided by the number of common shares and common share equivalents outstanding. Management uses growth in book value per share as a key measure of the value generated for our common shareholders each period and believes that book value per share is the key driver of Arch Capital’s share price over time. Book value per share is impacted by, among other factors, our underwriting results, investment returns and share repurchase activity, which has an accretive or dilutive impact on book value per share depending on the purchase price. Book value per share was $65.11 at December 31, 2025, a 22.6% increase from $53.11 at December 31, 2024. The growth in book value per share in 2025 primarily reflected strong underwriting and investment returns.
Previous wording
Operating return on average common equity (“Operating ROAE”) represents annualized after-tax operating income available to Arch common shareholders divided by average common shareholders’ equity available to Arch during the period. After-tax operating income available to Arch common shareholders, a “non-GAAP measure” as defined in the SEC rules, represents net income available to Arch common shareholders, excluding net realized gains or losses (which includes realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries), equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses, transaction costs and other, loss on redemption of preferred shares and income taxes. Management uses Operating ROAE as a key measure of the return generated to Arch common shareholders. See “Comment on Non-GAAP Financial Measures.”
Current wording
Operating return on average common equity (“Operating ROAE”) represents annualized after-tax operating income available to Arch common shareholders divided by average common shareholders’ equity available to Arch during the period. After-tax operating income available to Arch common shareholders, a “non-GAAP measure” as defined in the SEC rules, represents net income available to Arch common shareholders, excluding net realized gains or losses (which includes, but is not limited to, realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries), equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses, transaction costs and other, loss on redemption of preferred shares and income taxes. Management uses Operating ROAE as a key measure of the return generated to Arch common shareholders. See “Comment on Non-GAAP Financial Measures.”
Previous wording
Our annualized net income return on average common equity was 22.8% for 2024, compared to 29.7% for 2023. Our Operating ROAE was 18.9% for 2024, compared to 21.6% for 2023. Returns for 2024 reflected strong underwriting and investment returns, albeit with an elevated level of catastrophe activity.
Current wording
Our annualized net income return on average common equity was 20.1% for 2025, compared to 22.8% for 2024. Our Operating ROAE was 17.1% for 2025, compared to 18.9% for 2024. Returns for the 2025 period reflected strong underwriting and investment returns.
Previous wording
Throughout this filing, we present our operations in the way we believe will be the most meaningful and useful to investors, analysts, rating agencies and others who use our financial information in evaluating the performance of our company. This presentation includes the use of after-tax operating income available to Arch common shareholders, which is defined as net income available to Arch common shareholders, excluding net realized gains or losses (which includes realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries), equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses, transaction costs and other, net of income taxes (which for the 2023 fourth quarter includes a one-time deferred income tax benefit related to the enactment of Bermuda’s new corporate income tax), and the use of annualized operating return on average common equity. The presentation of after-tax operating income available to Arch common shareholders and annualized operating return on average common equity are non-GAAP financial measures as defined in Regulation G. The reconciliation of such measures to net income available to Arch common shareholders and annualized net income return on average common equity (the most directly comparable GAAP financial measures) in accordance with Regulation G is included under “Results of Operations” below.
Current wording
Throughout this filing, we present our operations in the way we believe will be the most meaningful and useful to investors, analysts, rating agencies and others who use our financial information in evaluating the performance of our company. This presentation includes the use of after-tax operating income available to Arch common shareholders, which is defined as net income available to Arch common shareholders, excluding net realized gains or losses (which includes, but is not limited to, realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries), equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses, transaction costs and other, net of income taxes, and the use of annualized operating return on average common equity. The presentation of after-tax operating income available to Arch common shareholders and annualized operating return on average common equity are non-GAAP financial measures as defined in Regulation G. The reconciliation of such measures to net income available to Arch common shareholders and annualized net income return on average common equity (the most directly comparable GAAP financial measures) in accordance with Regulation G is included under “Results of Operations” below.
Previous wording
We believe that net realized gains or losses, equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses and transaction costs and other in any particular period are not indicative of the performance of, or trends in, our business. Although net realized gains or losses, equity in net income or loss of investments accounted for using the equity method and net foreign exchange gains or losses are an integral part of our operations, the decision to realize these items are independent of the insurance underwriting process and result, in large part, from general economic and financial market conditions. Furthermore, certain users of our financial information believe that, for many companies, the timing of the realization of investment gains or losses is largely opportunistic. In addition, changes in the allowance for credit losses and net impairment losses recognized in earnings on the Company’s investments represent other-than-temporary declines in expected recovery values on securities without actual realization. Furthermore, we exclude net realized gains or losses from the acquisition or disposition of subsidiaries, due to their non-recurring nature, such items are not indicative of the performance of, or trends in, our business performance.
Current wording
We believe that net realized gains or losses, equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses and transaction costs and other in any particular period are not indicative of the performance of, or trends in, our business. Although net realized gains or losses, equity in net income or loss of investments accounted for using the equity method and net foreign exchange gains or losses are an integral part of our operations, the decision to realize these items are independent of the insurance underwriting process and result, in large part, from general economic and financial market conditions. Furthermore, certain users of our financial information believe that, for many companies, the timing of the realization of investment gains or losses is largely opportunistic. In addition, changes in the allowance for credit losses and net impairment losses recognized in earnings on our investments represent other-than-temporary declines in expected recovery values on securities without actual realization. Furthermore, we exclude net realized gains or losses from the acquisition or disposition of subsidiaries, due to their non-recurring nature, such items are not indicative of the performance of, or trends in, our business performance.
Previous wording
The use of the equity method on certain of our investments in certain funds that invest in fixed maturity securities is driven by the ownership structure of such funds (either limited partnerships or limited liability companies). In applying the equity method, these investments are initially recorded at cost and are subsequently adjusted based on our proportionate share of the net income or loss of the funds (which include changes in the market value of the underlying securities in the funds). This method of accounting is different from the way we account for our other investments and the timing of the recognition of equity in net income or loss of investments accounted for using the equity method may differ from gains or losses in the future upon sale or maturity of such investments.
Current wording
The use of the equity method on certain of our investments funds that invest in fixed maturity securities is driven by the ownership structure of such funds (either limited partnerships or limited liability companies). In applying the equity method, these investments are initially recorded at cost and are subsequently adjusted based on our proportionate share of the net income or loss of the funds (which include changes in the market value of the underlying securities in the funds). This method of accounting is different from the way in which we account for our other investments; and the timing of the recognition of equity in net income or loss of investments accounted for using the equity method may differ from gains or losses in the future upon sale or maturity of such investments.
Previous wording
We believe that showing net income available to Arch common shareholders exclusive of the items referred to above reflects the underlying fundamentals of our business since we evaluate the performance of and manage our business to produce an underwriting profit. In addition to presenting net income available to Arch common shareholders, we believe that this presentation enables investors and other users of our financial information to analyze our performance in a manner similar to how management analyzes performance. We also believe that this measure follows industry practice and, therefore, allows the users of financial information to compare our performance with our industry peer group. We believe that the equity analysts and certain rating agencies that follow us and the insurance industry as a whole generally exclude these items from their analyses for the same reasons.
Current wording
We believe that showing net income available to Arch common shareholders exclusive of the items referred to above reflects the underlying fundamentals of our business since we evaluate the performance of and manage our business to produce an underwriting profit. In addition to presenting net income available to Arch common shareholders, we believe that this presentation enables investors and other users of our financial information to analyze our performance in a manner similar to how management analyzes performance. We also believe that
Previous wording
Our presentation of segment information includes the use of a current year loss ratio which excludes favorable or adverse development in prior year loss reserves. This ratio is a non-GAAP financial measure as defined in Regulation G. The reconciliation of such measure to the loss ratio (the most directly comparable GAAP financial measure) in accordance with Regulation G is shown on the individual segment pages. Management utilizes the current year loss ratio in its analysis of the underwriting performance of each of our underwriting segments.
Current wording
Our presentation of segment information includes the use of a current year loss ratio which excludes favorable or adverse development in prior year loss reserves. This ratio is a non-GAAP financial measure as defined in Regulation G. The reconciliation of such measure to the loss ratio (the most directly comparable GAAP financial measure) in accordance with Regulation G is shown on the individual segment pages. Management utilizes the current year loss ratio in its analysis of the underwriting performance of each of our underwriting segments. Effective in the 2025 period, the ‘Other operating expense ratio’ includes ‘Other underwriting income.’
Previous wording
(1) Net realized gains or losses include realized and unrealized changes inthe fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains and losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries.
Current wording
(1) Net realized gains or losses include, but is not limited to, realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains and losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries.
Previous wording
(2) Income tax on net realized gains or losses, equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses and transaction costs and other reflects the relative mix reported by jurisdiction and the varying tax rates in each jurisdiction. The 2023 results were impacted by the establishment of a net deferred income tax asset of $1.18 billion, or $3.10 per share, related to the enactment of Bermuda’s new corporate income tax.
Current wording
(2) Income tax on net realized gains or losses, equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses and transaction costs and other reflects the relative mix reported by jurisdiction and the varying tax rates in each jurisdiction.
Previous wording
We determined our reportable segments using the management approach described in accounting guidance regarding disclosures about segments of an enterprise and related information. The accounting policies of the segments are the same as those used for the preparation of our consolidated financial statements. Intersegment business is allocated to the segment accountable for the underwriting results.
Current wording
We determined our reportable segments using the management approach described in accounting guidance regarding disclosures about segments of an enterprise and related information. The accounting policies of the segments are the same as those used for the preparation of our consolidated financial statements. Inter-segment business is allocated to the segment accountable for the underwriting results.
Previous wording
Net premiums written by the insurance segment were 17.3% higher in 2024 than in 2023 (7.0% excluding the MCE Acquisition). Growth in net premiums written reflected the impact of the MCE Acquisition along with an increases in most lines of business due in part to new business opportunities and rate changes.
Current wording
Net premiums written by the insurance segment were 13.4% higher in 2025 than in 2024. Growth in net premiums written primarily reflected the impact of the MCE Acquisition.
Previous wording
Net premiums written are primarily earned on a pro rata basis over the terms of the policies for all products, usually 12 months. Net premiums earned by the insurance segment were 21.7% higher in 2024 than in 2023 (10.5% excluding the MCE Acquisition), reflecting changes in net premiums written over the previous five quarters.
Current wording
Net premiums written are primarily earned on a pro rata basis over the terms of the policies for all products, usually 12 months. Net premiums earned by the insurance segment were 17.3% higher in 2025 than in 2024, reflecting changes in net premiums written over the previous five quarters.
Previous wording
The insurance segment’s current year loss ratio was 3.8 points higher in 2024 than in 2023. The 2024 loss ratio included 4.6 points of current year catastrophic event activity, primarily related to Hurricanes Helene and Milton, compared to 2.7 points in 2023. The current year loss ratio for 2024 also reflected the impact of rate increases and changes in mix of business.
Current wording
The insurance segment’s current year loss ratio in 2025 was consistent with 2024. The 2025 loss ratio included 4.4 points of current year catastrophic event activity, compared to 4.6 points in 2024. The current year loss ratio for the 2025 period also reflected the impact of the MCE Acquisition and changes in mix of business.
Previous wording
The insurance segment’s net favorable development was $37 million, or 0.5 points, for 2024, compared to $42 million, or 0.8 points, for 2023. Seenote 5, “Reserve for Losses and Loss Adjustment Expenses,” to our consolidated financial statements in Item 8 for information about the insurance segment’s prior year reserve development.
Current wording
The insurance segment’s net favorable development was $43 million, or 0.6 points, for 2025, compared to $37 million, or 0.5 points, for 2024. Seenote 5, “Reserve for Losses and Loss Adjustment Expenses,” to our consolidated financial statements in Item 8 for information about the insurance segment’s prior year reserve development.
Previous wording
The insurance segment’s underwriting expense ratio was 33.4% in 2024, compared to 34.4% in 2023. The impact of the MCE Acquisition lowered the underwriting expense ratio by approximately 1.6 points, primarily due to the effects of the fair value estimation of the assets acquired at closing, including the non-recognition of deferred acquisition costs. The value of policies in force at closing are considered within the value of business acquired which is amortized through ‘amortization of intangible assets.’ The underwriting expense ratio also benefited from an initial lower level of operating expenses in the acquired business.
Current wording
The insurance segment’s underwriting expense ratio was 33.9% in 2025, compared to 33.4% in 2024.
Previous wording
Net premiums earned in 2024 were 24.1% higher than in 2023, reflecting changes in net premiums written over the previous five quarters, including the mix and type of business written.
Current wording
Net premiums earned in 2025 were 12.2% higher than in 2024, reflecting changes in net premiums written over the previous five quarters, including the mix and type of business written.
Previous wording
The reinsurance segment’s current year loss ratio was 4.4 points higher in 2024 than in 2023. The 2024 loss ratio included 11.8 points for current year catastrophic event activity related to Hurricanes Milton and Helene, and a series of other global events, compared to 6.8 points in 2023. The current year loss ratio for 2024 also reflected the impact of rate increases and changes in mix of business.
Current wording
The reinsurance segment’s current year loss ratio was 1.5 points lower in 2025 than in 2024. The 2025 loss ratio included 8.5 points for current year catastrophic event activity, primarily related to the California wildfires, compared to 11.8 points in 2024, primarily related to Hurricanes Milton, Helene and a series of other global events. The current year loss ratio for 2025 also reflected changes in mix of business.
Previous wording
The reinsurance segment’s net favorable development was $188 million, or 2.6 points, for 2024, compared to $152 million, or 2.6 points, for 2023, Seenote 5, “Reserve for Losses and Loss Adjustment Expenses,” to our consolidated financial statements in Item 8 for information about the reinsurance segment’s prior year reserve development.
Current wording
The reinsurance segment’s net favorable development was $322 million, or 4.0 points, for 2025, compared to $188 million, or 2.6 points, for 2024, Seenote 5, “Reserve for Losses and Loss Adjustment Expenses,” to our consolidated financial statements in Item 8 for information about the reinsurance segment’s prior year reserve development.
Previous wording
The underwriting expense ratio for the reinsurance segment was 23.5% in 2024, compared to 26.1% in 2023, with the decrease primarily due to growth in net premiums earned.
Current wording
The underwriting expense ratio for the reinsurance segment was 24.0% in 2025, compared to 23.5% in 2024. The increase in the 2025 period primarily reflected lower profit and sliding scale commissions on ceded business.
Previous wording
Net premiums written for 2024 were 5.7% higher than in 2023. The increase in net premiums written in 2024 primarily reflected a lower level of premiums ceded to Bellemeade entities.
Current wording
Net premiums written for 2025 were 4.7% lower than in 2024. The reduction in net premiums written in the 2025 period primarily reflected lower gross premiums written and expenses related to tender offers of certain Bellemeade Re mortgage insurance linked notes.
Previous wording
The persistency rate of the U.S. primary portfolio of mortgage loans was 82.1% at December 31, 2024 compared to 83.6% at December 31, 2023. The persistency rate represents the percentage of mortgage insurance in force at the beginning of a 12-month period that remains in force at the end of such period.
Current wording
The persistency rate of the U.S. primary portfolio of mortgage loans was 81.8% at December 31, 2025 compared to 82.1% at December 31, 2024. The persistency rate represents the percentage of mortgage insurance in force at the beginning of a 12 month period that remains in force at the end of such period.
Previous wording
Net premiums earned for 2024 were 6.3% higher than in 2023, reflecting changes in net premiums written over the previous five quarters.
Current wording
Net premiums earned for 2025 were 4.8% lower than in 2024, reflecting changes in net premiums written over the previous five quarters.
Previous wording
Other underwriting income, which is primarily related to GSE risk-sharing transactions services and our whole mortgage loan purchase and sell program, was $17 million for 2024, compared to $14 million for 2023.
Current wording
Other underwriting income, which is primarily related to GSE risk-sharing transactions services, was $22 million for 2025, compared to $17 million for 2024.
Previous wording
The mortgage segment’s current year loss ratio was 2.2 points lower in 2024 compared to 2023. The lower current year loss ratio for 2024 reflected a lower average case reserve per default. The percentage of loans in default on U.S. primary mortgage insurance increased from 1.74% at December 31, 2023 to 2.09% at December 31, 2024.
Current wording
The mortgage segment’s current year loss ratio was 1.2 points higher in 2025 compared to 2024. The higher current year loss ratio in 2025 period reflected slightly higher new delinquencies and the impact of the Bellemeade Re tender offers noted above. The percentage of loans in default on U.S. primary mortgage insurance increased from 2.09% at December 31, 2024 to 2.17% at December 31, 2025.
Previous wording
We insure mortgages for homes in areas that have been impacted by catastrophic events. Generally, mortgage insurance losses occur only when a credit event occurs and, following a physical damage event, when the home is restored to pre-storm condition. Our ultimate claims exposure will depend on the number of delinquency notices received and the ultimate claim rate related to such notices. In the event of natural disasters, cure rates are influenced by the adequacy of homeowners and flood insurance carried on a related property, and a borrower's access to aid from
Current wording
We insure mortgages for homes in areas that have been impacted by catastrophic events. Generally, mortgage insurance losses occur only when a credit event occurs and, following a physical damage event, when the home is restored to pre-storm condition. Our ultimate claims exposure will depend on the number of delinquency notices received and the ultimate claim rate related to such notices. In the event of natural disasters, cure rates are influenced by the adequacy of homeowners and flood insurance carried on a related property, and a borrower's access to aid from government entities and private organizations, in addition to other factors which generally impact cure rates in unaffected areas.
Previous wording
The mortgage segment’s net favorable development was $282 million, or 23.0 points, for 2024, compared to $344 million, or 29.7 points, for 2023. Seenote 5, “Reserve for Losses and Loss Adjustment Expenses,” to our consolidated financial statements in Item 8 for information about the mortgage segment’s prior year reserve development.
Current wording
The mortgage segment’s net favorable development was $235 million, or 20.2 points, for 2025, compared to $282 million, or 23.0 points, for 2024. Seenote 5, “Reserve for Losses and Loss Adjustment Expenses,” to our consolidated financial statements in Item 8 for information about the mortgage segment’s prior year reserve development.
Previous wording
The corporate results include net investment income, net realized gains or losses, equity in net income or loss of investments accounted for using the equity method, other income (loss), corporate expenses, transaction costs and other, amortization of intangible assets, interest expense, net foreign exchange gains or losses, income taxes items (which for 2023 reflects the establishment of a net deferred income tax asset related to the enactment of Bermuda’s new corporate income tax), income from operating affiliates and items related to our non-cumulative preferred shares.
Current wording
The Company’s corporate results include net investment income, net realized gains or losses (which includes, but is not limited to, realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries), equity in net income or loss of investments accounted for using the equity method, other income or loss, corporate expenses, transaction costs and other, amortization of intangible assets, interest expense, net foreign exchange gains or losses, income taxes, income from operating affiliates and items related to our non-cumulative preferred shares.
Previous wording
(2) Investment expenses were approximately 0.26% of average invested assets for 2024, consistent with 0.26% for 2023.
Current wording
(2) Investment expenses were approximately 0.23% of average invested assets for 2025, compared to 0.26% for 2024.
Previous wording
The pre-tax investment income yield was 4.25% for 2024, compared to 3.53% for 2023. The growth in net investment income for 2024 compared to 2023 primarily reflected higher yields available in the financial markets. The pre-tax investment income yields were calculated based on amortized cost. Net cash flow from operating activities contributed $6.7 billion in 2024, which increased our invested asset base and contributed to the growth in net investment income. Net investment income in 2024 was partially impacted by a $1.9 billion special dividend paid to common shareholders in December which required us to sell certain investments. Yields on future investment income may vary based on financial market conditions, investment allocation decisions and other factors.
Current wording
The pre-tax investment income yield was 4.11% for 2025, compared to 4.25% for 2024. The pre-tax investment income yields were calculated based on amortized cost. Net cash flow from operating activities contributed $6.2 billion in 2025, which increased our invested asset base and contributed to the growth in net investment income. Yields on future investment income may vary based on financial market conditions, investment allocation decisions and other factors.
Previous wording
We recorded net realized gains of $197 million for 2024, compared to net realized losses of $165 million for 2023. Currently, our portfolio is actively managed to maximize total return within certain guidelines. The effect of financial market movements on the investment portfolio will directly impact net realized gains or losses as the portfolio is rebalanced. Net realized gains or losses from the sale of fixed maturities primarily results from our decisions to reduce credit exposure, to change duration targets, to rebalance our portfolios or due to relative value determinations.
Current wording
We recorded net realized gains of $464 million for 2025, compared to net realized gains of $197 million for 2024. Amounts in both periods reflected sales of investments as well as the impact of financial market movements on the Company’s equity securities and investments accounted for under the fair value option method. Amounts in the 2025 period also include losses related to the impairment and sale of certain alternative investments accounted for under the equity method. Currently, our portfolio is actively managed to maximize total return within certain guidelines. The effect of financial market movements on the investment portfolio will directly impact net realized gains or losses as the portfolio is rebalanced. Net realized gains or losses from the sale of fixed maturities primarily results from our decisions to reduce credit exposure, to change duration targets, to rebalance our portfolios or due to relative value determinations.
Previous wording
We recorded $580 million of equity in net income related to investments accounted for using the equity method for 2024, compared to $278 million for 2023. Investments accounted for using the equity method totaled $6.0 billion at December 31, 2024, compared to $4.6 billion at December 31, 2023. Seenote 9, “Investment Information—Equity in Net Income (Loss) of Investments Accounted For Using the Equity Method,” to our consolidated financial statements in Item 8 for additional information.
Current wording
We recorded $504 million of equity in net income related to investments accounted for using the equity method for 2025, compared to $580 million for 2024. Investments accounted for using the equity method totaled $6.5 billion at December 31, 2025, compared to $6.0 billion at December 31, 2024. Seenote 9, “Investment Information—Equity in Net Income (Loss) of Investments Accounted For Using the Equity Method,” to our consolidated financial statements in Item 8 for additional information.
Previous wording
Other income for 2024 was $42 million, compared to $27 million for 2023. Amounts in both periods primarily reflect changes in the cash surrender value of our investment in corporate-owned life insurance.
Current wording
Other income for 2025 was $54 million, compared to $42 million for 2024. Amounts in both periods primarily reflect changes in the cash surrender value of our investment in corporate-owned life insurance.
Previous wording
Corporate expenses were $119 million for 2024, compared to $96 million for 2023. Such amounts primarily represent certain holding company costs necessary to support our worldwide operations and costs associated with operating as a publicly traded company.
Current wording
Corporate expenses were $57 million for 2025, compared to $119 million for 2024. Such expenses primarily represent certain holding company costs necessary to support our worldwide operations and costs associated with operating as a publicly traded company. The 2025 period reflected Bermuda substance-based tax credits enacted in December 2025 with retroactive effect to January 1, 2025.
Previous wording
Transaction costs and other were $81 million for 2024, compared to $6 million for 2023. The 2024 period primarily includes direct costs related to the MCE Acquisition and ongoing integration efforts.
Current wording
Transaction costs and other were $75 million for 2025, compared to $81 million for 2024. The amounts for both the 2025 and 2024 periods primarily reflect direct costs related to the MCE Acquisition and ongoing integration efforts.
Previous wording
Amortization of intangible assets for 2024 was $235 million, compared to $95 million for 2023. Amounts in 2024 and 2023 primarily related to amortization of finite-lived intangible assets with the increase in 2024 primarily related to the MCE Acquisition. Seenote 2,“Acquisition.”
Current wording
Amortization of intangible assets for 2025 was $193 million, compared to $235 million for 2024. Amounts in both 2025 and 2024 primarily related to amortization of finite-lived intangible assets acquired as part of the MCE Acquisition.
Previous wording
Interest expense was $141 million for 2024, compared to $133 million for 2023. Interest expense primarily reflects amounts related to our outstanding senior notes.
Current wording
Interest expense was $148 million for 2025, compared to $141 million for 2024. Interest expense primarily reflects amounts related to our outstanding senior notes.
Previous wording
Net foreign exchange gains for 2024 were $75 million, compared to net foreign exchange losses for 2023 of $60 million. Amounts in such periods were primarily unrealized and resulted from the effects of revaluing our net insurance liabilities required to be settled in foreign currencies at each balance sheet date.
Current wording
Net foreign exchange losses for 2025 were $128 million, compared to net foreign exchange gains for 2024 of $75 million. Amounts in such periods were primarily unrealized and resulted from the effects of revaluing our net insurance liabilities required to be settled in foreign currencies at each balance sheet date.
Showing the first 40 of 86 pairs. Open the source sections for the rest.
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Current report — wording carried from elsewhere
this measure follows industry practice and, therefore, allows the users of financial information to compare our performance with our industry peer group. We believe that the equity analysts and certain rating agencies that follow us and the insurance industry as a whole generally exclude these items from their analyses for the same reasons.
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note 15, “Income Taxes,” to our consolidated financial statements in Item 8.
Current report — wording carried from elsewhere
and assumptions made as part of the reserving process could prove to be inaccurate due to several factors, including the fact that for certain lines of business relatively limited historical information has been reported to us through December 31, 2025. Accordingly, the reserving for incurred losses in these lines of business could be subject to greater variability. See Item 1A, “Risk Factors – Risks Relating to Our Industry, Business & Operations – Underwriting risks and reserving for losses are based on probabilities and related modeling, which are subject to inherent uncertainties.”
Current report — wording carried from elsewhere
underlying reserves for losses and loss adjustment expenses as discussed above in “—Loss Reserves.” In particular, reinsurance recoverables may be affected by deemed inuring reinsurance, industry losses reported by various statistical reporting services, and other factors. Reinsurance recoverables are recorded as assets, predicated on the reinsurers’ ability to meet their obligations under the reinsurance agreements. If the reinsurers are unable to satisfy their obligations under the agreements, our insurance or reinsurance operations would be liable for such defaulted amounts.
Current report — wording carried from elsewhere
contract. Estimates of premiums written under pro rata contracts are recorded in the period in which the underlying risks incept and are based on information provided by the brokers and the ceding companies. For multi-year reinsurance treaties which are payable in annual installments, generally, only the initial annual installment is included as premiums written at policy inception due to the ability of the reinsured to commute or cancel coverage during the term of the policy. The remaining annual installments are included as premiums written at each successive anniversary date within the multi-year term.
Current report — wording carried from elsewhere
Mortgage guaranty insurance policies are contracts that are generally non-cancelable by the insurer, are renewable at a fixed price, and provide for payment of premiums on a monthly, annual or single basis. Upon renewal, we are not able to re-underwrite or re-price our policies. Consistent with industry accounting practices, premiums written on a monthly basis are earned as coverage is provided. Premiums written on an annual basis are amortized on a monthly pro rata basis over the year of coverage. Primary mortgage
Current report — wording carried from elsewhere
As part of our investment strategy, we seek to establish a level of cash and highly liquid short-term and intermediate-term securities which, combined with expected cash flow, is believed by us to be adequate to meet our foreseeable payment obligations. However, due to the nature of our operations, cash flows are affected by claim payments that
Current report — wording carried from elsewhere
are callable by our investment managers. The timing of the funding of investment commitments is uncertain and may require us to access cash on short notice.
Current report — wording carried from elsewhere
amount of the repurchase transactions under this program will depend on a variety of factors, including market conditions, the development of the economy, corporate and regulatory considerations. We will continue to monitor our share price and, depending upon results of operations, market conditions and the development of the economy, as well as other factors, we will consider share repurchases on an opportunistic basis.
Current report — wording carried from elsewhere
Securities falls, and the converse is also true. Based on historical observations, there is a low probability that all interest rate yield curves would shift in the same direction at the same time. Furthermore, at times interest rate movements in certain credit sectors exhibit a much lower correlation to changes in U.S. Treasury yields. Accordingly, the actual effect of interest rate movements may differ materially from the amounts set forth in the following tables.
Current report — wording carried from elsewhere
derivatives held at December 31, 2024. Seenote 11, “Derivative Instruments,” to our consolidated financial statements in Item 8 for additional disclosures concerning derivatives.
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Previous report — wording carried elsewhere
government entities and private organizations, in addition to other factors which generally impact cure rates in unaffected areas.
Previous report — wording carried elsewhere
We have entered into various aggregate excess of loss reinsurance agreements with various special purpose reinsurance companies domiciled in Bermuda. These are special purpose variable interest entities that are not
Previous report — wording carried elsewhere
total investable assets held by Arch were internally managed, compared to $21.9 billion, or 63%, at December 31, 2023.
Previous report — wording carried elsewhere
standards. These regulations include restrictions that limit the amount of dividends or other distributions, such as loans or cash advances, available to shareholders without prior approval of the insurance regulatory authorities. Each state requires prior regulatory approval of any payment of extraordinary dividends.
Previous report — wording carried elsewhere
Arch Capital, through its subsidiaries, provides financial support to certain of its insurance subsidiaries and affiliates,
Previous report — wording carried elsewhere
Our senior notes were issued by Arch Capital, Arch Capital Group (U.S.) Inc. (“Arch-U.S.”) and Arch Capital Finance
Previous report — wording carried elsewhere
CATASTROPHIC EVENTS AND SEVERE ECONOMIC EVENTS
Previous report — wording carried elsewhere
We have substantial exposure to unexpected, large losses resulting from future man-made catastrophic events, such as acts of war, acts of terrorism and political instability. These risks are inherently unpredictable. It is difficult to predict the timing of such events with statistical certainty or estimate the amount of loss any given occurrence will generate. It is not possible to completely eliminate our exposure to unforecasted or unpredictable events and, to the extent that
Previous report — wording carried elsewhere
Net probable maximum loss estimates are net of expected reinsurance recoveries, before income tax and before excess reinsurance reinstatement premiums. RDS loss estimates are net of expected reinsurance recoveries and before income tax. Catastrophe loss estimates are reflective of the zone indicated and not the entire portfolio. Since hurricanes and windstorms
Previous report — wording carried elsewhere
In addition, we consider the effect of credit spread movements on the market value of our Fixed Income Securities and the corresponding change in unrealized value.
Previous report — wording carried elsewhere
December 31, 2024 and 2023, respectively, and would have decreased book value per share by approximately $0.40 and $0.27, respectively. An immediate hypothetical 10% increase in the value of each position would increase the fair value of such investments by approximately $149 million and $101 million at December 31, 2024 and 2023, respectively, and would have increased book value per share by approximately $0.40 and $0.27, respectively.