ARCH CAPITAL GROUP LTD.
For the period ended Sep 30, 2026. Filed Nov 4, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2026 · Filed Nov 4, 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-Q
Period ended 2026-06-30; filed 2026-08-04.
0000947484-26-000124
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations“Comment on Non-GAAP Financial Measures.”Current report: 10-Q
Period ended 2026-09-30; filed 2026-11-04.
0000947484-26-000152
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations“Comment on Non-GAAP Financial Measures.”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 33 previous paragraphs and 32 current paragraphs.
20 unchanged; 10 reworded; 2 added; 3 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 8 previous and 8 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 (2)
Current report
Our insurance segment reported $108 million of underwriting income for the 2026 third quarter. We continue to see attractive opportunities in certain casualty focused lines, including excess and surplus casualty, construction and national accounts casualty in the U.S., as well as select specialty lines within our London market business. We believe that adverse development emerging across the industry for more recent accident years reinforces the need for casualty pricing to remain at or above loss cost trend. These opportunities were partially offset by our planned non-renewal of certain middle market commercial program business which we acquired from Allianz in 2024 (the “MCE Acquisition”) and continued competitive pressure in property and certain short tail lines. We expect underlying premium growth to remain measured under current market conditions, while we continue to seek opportunities to grow in areas where pricing, terms and conditions support our return objectives.
Current report
Our reinsurance segment contributed $393 million of underwriting income in the 2026 third quarter, benefiting from relatively light catastrophe activity. Net premiums written were $1.6 billion, down roughly 9% when compared to the 2025 third quarter, reflecting abundant market capacity, lower rates and reduced participation across a number of property and other short tail lines. We expect continued pricing pressure within property catastrophe and other short tail lines. While casualty business continues to provide selective opportunities, available capacity and competitive terms and conditions may limit our ability to grow this business. Consistent with our cycle management, we look to manage our net portfolio and stay in front of clients by finding solutions for our cedants and brokers. Although declining rates may place gradual pressure on underwriting margins, we believe our global reach, underwriting expertise, market position and access to traditional reinsurance and third party capital provide us with the flexibility to respond as opportunities emerge.
Removed paragraphs (3)
Previous report
Our insurance segment reported $27 million of underwriting income for the 2026 second quarter. Growth opportunities remained across most casualty-focused lines of business, including E&S casualty, construction and national accounts in the U.S., as well as select lines of our London market business, including war and terrorism. As a market leader in specialty insurance, we look to support our clients with underwriting expertise, claims capabilities and risk solutions while maintaining disciplined underwriting standards. Our diversified platform provides us with the flexibility to grow in areas where pricing supports our return objectives. These opportunities were partially offset by our decision not to renew certain middle market commercial program business which we acquired from Allianz in 2024 (the “MCE
Previous report
Acquisition”) along with a reduction in E&S property business due to competitive rate pressure.
Previous report
Our reinsurance segment contributed $410 million of underwriting income in the 2026 second quarter, benefiting from relatively light catastrophe losses. Net premiums written were $1.8 billion, down roughly 10% when compared to the 2025 second quarter, reflecting pricing pressures and higher retentions by cedants in certain property and short‑tail lines along with targeted increased retrocessions. As increased capacity has contributed to competitive conditions across portions of the reinsurance market, our underwriting teams are actively managing the cycle by selectively writing new business where returns are attractive and adjusting participation where pricing does not meet our minimum return thresholds. At the same time, our scale, market position and access to traditional reinsurance and third party capital allow us to continue providing meaningful solutions to brokers and cedants while managing our net risk profile.
Reworded paragraphs (10)
Previous wording
Arch Capital Group Ltd. (“Arch Capital” and, together with its subsidiaries, “Arch”, “the Company”, “we”, “our” or “us”) is a publicly listed Bermuda exempted company with approximately $28.3 billion in capital at June 30, 2026 and, through operations in Bermuda, the United States, Europe, Canada and Australia, writes insurance, reinsurance and mortgage insurance on a worldwide basis.
Current wording
Arch Capital Group Ltd. (“Arch Capital” and, together with its subsidiaries, “Arch”, “the Company”, “we”, “our” or “us”) is a publicly listed Bermuda exempted company with approximately $27.3 billion in capital at September 30, 2026 and, through operations in Bermuda, the United States, Europe, Canada and Australia, writes insurance, reinsurance and mortgage insurance on a worldwide basis.
Previous wording
We delivered a strong 2026 second quarter, with attractive underwriting margins reflecting the disciplined execution of our underwriting and capital management strategies. For the quarter, we generated an annualized net income return on average common equity and an annualized operating return on average common equity of 18.0% and 15.3%, respectively. See “Comment on Non-GAAP Financial Measures.” 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 believe our balance sheet is in excellent health, giving us optionality as we remain prudent stewards of the capital entrusted to us by our shareholders. Our strong balance sheet permits us to both invest in our business and return capital to investors. During the 2026 second quarter, we repurchased 12.4 million common shares for an aggregate $1.2 billion. Through the first half of the year, we have repurchased approximately 94% of our net income in our own shares.
Current wording
We delivered a strong 2026 third quarter, with attractive underwriting margins reflecting the disciplined execution of our underwriting and capital management strategies. For the quarter, we generated an annualized net income return on average common equity and an annualized operating return on average common equity of 18.1% and 16.0%, respectively. See “Comment on Non-GAAP Financial Measures.” Critical to our cycle management is emphasizing underwriting discipline, 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. Our strong balance sheet permits us to both invest in our business and return capital to investors. We repurchased $1.4 billion of our shares in the 2026 third quarter and $3.4 billion on a year-to-date basis.
Previous wording
Our mortgage segment continued to deliver a steady level of earnings, generating $220 million of underwriting income in the 2026 second quarter. New originations remained modest due to affordability challenges tied to mortgage rates and home prices, which continued to constrain demand. We believe the underlying fundamentals of our mortgage portfolio remain strong, and our U.S. market share was stable. The persistency of our in-force U.S. primary mortgage insurance portfolio remained a healthy 79.9%, 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 and embedded equity of our in-force portfolio.
Current wording
Our mortgage segment continued to deliver a steady level of earnings, generating $201 million of underwriting income in the 2026 third quarter. New originations remained modest due to affordability challenges tied to mortgage rates and home prices, which continued to constrain demand. We believe the underlying fundamentals of our mortgage portfolio remain strong, and our U.S. market share was stable. While our delinquency rate remained low, the persistency of our in-force U.S. primary mortgage insurance portfolio stayed healthy at 79.2%, an important factor in the sustainability of future premium flow. 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. We also continue to identify opportunities in our businesses outside of U.S. primary mortgage insurance, which provide further diversification within the segment.
Previous wording
Book value per share represents total common shareholders’ equity available to Arch divided by the number of common shares 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 $68.04 at June 30, 2026, compared to $66.19 at March 31, 2026, and $59.17 at June 30, 2025. The 2.8% increase in book value per share for the 2026 second quarter primarily reflected strong underwriting and investment returns, partially offset by $1.2 billion of shares purchased at an average price higher than the book value per share.
Current wording
Book value per share represents total common shareholders’ equity available to Arch divided by the number of common shares 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 $67.90 at September 30, 2026, compared to $68.04 at June 30, 2026, and $62.32 at September 30, 2025. The 0.2% decrease in book value per share for the 2026 third quarter primarily reflected the impact of share repurchases at an average price higher than book value along with the impact of rising interest rates on the fair value of our available for sale investment portfolio.
Previous wording
Our annualized net income return on average common equity was 18.0% for the 2026 second quarter, compared to 22.9% for the 2025 second quarter, and 17.9% for the six months ended June 30, 2026, compared to 17.0% for the 2025 period. Our Operating ROAE was 15.3% for the 2026 second quarter, compared to 18.2% for the 2025 second quarter and 15.4% for the six months ended June 30, 2026, compared to 14.8% for the 2025 period. Returns for the 2026 periods reflected strong underwriting and investment returns.
Current wording
Our annualized net income return on average common equity was 18.1% for the 2026 third quarter, compared to 23.8% for the 2025 third quarter, and 18.2% for the nine months ended September 30, 2026, compared to 19.5% for the 2025 period. Our Operating ROAE was 16.0% for the 2026 third quarter, compared to 18.5% for the 2025 third quarter and 15.8% for the nine months ended September 30, 2026, compared to 16.2% for the 2025 period.
Previous wording
Total return for the 2026 periods reflected interest income and gains on risk assets outweighing the impact of rising US Treasury yields. The portfolio slightly underperformed their benchmark returns, primarily due to a small underweight to alternatives. We continue to maintain a relatively short duration on our fixed income portfolio of 3.50 years at June 30, 2026, in line with our asset allocation targets.
Current wording
Total return for the 2026 periods primarily reflected the impact of rising U.S. Treasury yields on our fixed income portfolio, for which we continue to maintain a relatively short duration of 3.25 years at September 30, 2026, in line with our asset allocation targets.
Previous wording
The benchmark return index is a customized combination of indices intended to approximate a target portfolio by asset mix and average credit quality with a fixed income component matching the approximate estimated duration and currency mix of our insurance and reinsurance liabilities. It is recalibrated annually. Although the estimated fixed income duration and average credit quality of this index will move as the duration and rating of its constituent securities change, generally we do not adjust the composition of the benchmark return index during the year except to incorporate changes to the mix of liability currencies and
Current wording
The benchmark return index is a customized combination of indices intended to approximate a target portfolio by asset mix and average credit quality with a fixed income component matching the approximate estimated duration and currency mix of our insurance and reinsurance liabilities. It is recalibrated annually. Although the estimated fixed income duration and average credit quality of this index will move as the duration and rating of its constituent securities change, generally we do not adjust the composition of the benchmark return index during the year except to incorporate changes to the mix of liability currencies and durations noted above. The benchmark return index should not be interpreted as expressing a preference for or aversion to any particular sector or sector weight. At September 30, 2026, the fixed income portion of the benchmark had an
Previous wording
durations noted above. The benchmark return index should not be interpreted as expressing a preference for or aversion to any particular sector or sector weight. At June 30, 2026, the fixed income portion of the benchmark had an average credit quality of “A1” by Moody’s and an estimated fixed income duration of 3.34 years.
Current wording
average credit quality of “A1” by Moody’s and an estimated fixed income duration of 3.25 years.
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 include, but are 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, 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
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 include, but are 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, 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
Previous wording
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
(the most directly comparable GAAP financial measures) in accordance with Regulation G is included under “Results of Operations” below.