RLI CORP

Previous wording

Forward looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 appear throughout this report. These forward looking statements generally include words such as “expect,” “predict,” “estimate,” “will,” “should,” “anticipate,” “believe” and similar expressions. Such assumptions are, in turn, based on information available and internal estimates and analyses of general economic conditions, competitive factors, conditions specific to the property and casualty insurance and reinsurance industries, claims development and the impact thereof on our loss reserves, the adequacy and financial security of our reinsurance programs, developments in the securities market and the impact on our investment portfolio, regulatory changes and conditions and other factors. These assumptions are subject to various risks, uncertainties and other factors, including, without limitation those set forth in “Item 1A. Risk Factors” within the Annual Report on Form 10-K for the year ended December 31, 2024 and Part II within this report. Actual results could differ materially from those expressed in, or implied by, these forward looking statements. Forward looking statements reflect the Company’s expectations, plans or forecasts of future events and views as of the date of this report. While the Company may elect to update these forward looking statements at some point in the future, the Company specifically disclaims any obligation to do so. You should review the various risks, uncertainties and other factors listed from time to time in our Securities and Exchange Commission filings.

Current wording

Forward looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 appear throughout this report. These forward looking statements generally include words such as “expect,” “predict,” “estimate,” “will,” “should,” “anticipate,” “believe” and similar expressions. Such assumptions are, in turn, based on information available and internal estimates and analyses of general economic conditions, competitive factors, conditions specific to the property and casualty insurance, reinsurance and surety industries, claims development and the impact thereof on our loss reserves, the adequacy and financial security of our reinsurance programs, developments in the securities market and the impact on our investment portfolio, regulatory changes and conditions and other factors. These assumptions are subject to various risks, uncertainties and other factors, including, without limitation those set forth in “Item 1A. Risk Factors” within the Annual Report on Form 10-K for the year ended December 31, 2024 and Part II within this report. Actual results could differ materially from those expressed in, or implied by, these forward looking statements. Forward looking statements reflect the Company’s expectations, plans or forecasts of future events and views as of the date of this report. While the Company may elect to update these forward looking statements at some point in the future, the Company specifically disclaims any obligation to do so. You should review the various risks, uncertainties and other factors listed from time to time in our Securities and Exchange Commission filings.

Previous wording

RLI Corp. is a U.S.-based, specialty insurance company that underwrites select property, casualty and surety products through three major subsidiaries. Our focus is on niche markets and developing unique products that are tailored to customers’ needs. We hire underwriters and claim examiners with deep expertise and provide exceptional customer service and support.

Current wording

RLI Corp. is a U.S.-based, specialty insurance company that underwrites select property, casualty and surety products through three major subsidiaries. Our focus is on niche markets and developing unique products that are tailored to customers’

Previous wording

We maintain a highly diverse product portfolio and underwrite for profit in all market conditions. In 2024, we achieved our 29th consecutive year of underwriting profitability. Over the 29-year period, we averaged an 88.1 combined ratio. This drives our ability to provide shareholder returns in three different ways: the underwriting income itself, net investment income from our investment portfolio and long-term appreciation in our equity portfolio.

Current wording

needs. We hire underwriters and claim examiners with deep expertise and provide exceptional customer service and support. We maintain a highly diverse product portfolio and underwrite for profit in all market conditions. In 2024, we achieved our 29th consecutive year of underwriting profitability. Over the 29-year period, we averaged an 88.1 combined ratio. This drives our ability to provide shareholder returns in three different ways: the underwriting income itself, net investment income from our investment portfolio and long-term appreciation in our equity portfolio.

Previous wording

Underwriting income or profit represents one measure of the pretax profitability of our insurance operations, and is derived by subtracting losses and settlement expenses, policy acquisition costs and insurance operating expenses from net premiums earned, which are all GAAP financial measures. Each of these components are presented in the statements of earnings but are not subtotaled. However, this information is available in total and by segment in note 6 to the unaudited

Current wording

Underwriting income or profit represents one measure of the pretax profitability of our insurance operations, and is derived by subtracting losses and settlement expenses, policy acquisition costs and insurance operating expenses from net premiums earned, which are all GAAP financial measures. Each of these components are presented in the statements of

Previous wording

condensed consolidated financial statements in this quarterly report on Form 10-Q, and in note 11 to the consolidated financial statements in our 2024 Annual Report on Form 10-K, regarding operating segment information. The nearest comparable GAAP measure is earnings before income taxes which, in addition to underwriting income, includes net investment income, net realized gains or losses, net unrealized gains or losses on equity securities, general corporate expenses, debt costs and our portion of earnings from unconsolidated investees. A reconciliation of net earnings to underwriting income follows:

Current wording

earnings but are not subtotaled. However, this information is available in total and by segment in note 6 to the unaudited condensed consolidated financial statements in this quarterly report on Form 10-Q, and in note 11 to the consolidated financial statements in our 2024 Annual Report on Form 10-K, regarding operating segment information. The nearest comparable GAAP measure is earnings before income taxes which, in addition to underwriting income, includes net investment income, net realized gains or losses, net unrealized gains or losses on equity securities, general corporate expenses, debt costs and our portion of earnings from unconsolidated investees. A reconciliation of net earnings to underwriting income follows:

Previous wording

Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024

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Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

Previous wording

Net premiums earned increased 8 percent, driven primarily by products in our casualty and surety segments. Investment income was up 14 percent, due to an increased average asset base and higher reinvestment rates. Positive market performance resulted in $1 million of unrealized gains on equity securities in the first six months of 2025, compared to $49 million in 2024. Realized gains during the first six months of 2025 were comprised of $29 million of realized gains on equity securities, primarily due to rebalancing within our equity strategies, $1 million of realized losses on the fixed income portfolio and $2 million of other realized gains. This compares to $13 million of realized gains on the equity portfolio, $2 million of realized losses on the fixed income portfolio and $5 million of other realized losses during the first six months of 2024.

Current wording

Net premiums earned increased 7 percent, driven primarily by products in our casualty and surety segments. Investment income was up 13 percent, due to an increased average asset base and higher reinvestment rates. Positive market performance resulted in $43 million of unrealized gains on equity securities in the first nine months of 2025, compared to $87 million in 2024. Realized gains during the first nine months of 2025 were comprised of $45 million of realized gains on equity securities, primarily due to rebalancing within our equity strategies, $2 million of realized gains on the fixed income portfolio and $1 million of other realized gains. This compares to $20 million of realized gains on the equity portfolio, $3 million of realized losses on the fixed income portfolio and $6 million of other realized losses during the first nine months of 2024.

Previous wording

Underwriting income was $133 million on an 83.4 combined ratio for the first six months of 2025, compared to $148 million on an 80.0 combined ratio in the same period of 2024. Underwriting results for 2025 were impacted by $26 million of pretax losses from catastrophe events, compared to $28 million in 2024. Results for each period benefited from favorable development on prior years’ loss reserves, which provided additional pretax earnings of $59 million in the first six months of 2025, compared to $65 million in 2024.

Current wording

Underwriting income was $193 million on an 84.0 combined ratio for the first nine months of 2025, compared to $188 million on an 83.3 combined ratio in the same period of 2024. Underwriting results for 2025 were impacted by $26 million of pretax losses from catastrophe events, compared to $67 million in 2024. Results for each period benefited from favorable development on prior years’ loss reserves, which provided additional pretax earnings of $74 million in the first nine months of 2025, compared to $85 million in 2024.

Previous wording

The loss ratio increased to 45.2 from 42.1 due to lower levels of favorable development on prior years’ loss reserves. Additionally, the loss ratio increased from a shift in the mix of business towards casualty lines, which tend to have higher loss ratios than our property and surety products, particularly in periods with lower catastrophe losses. The expense ratio increased to 38.2 from 37.9. Increased expenses were driven by continued investments in people and technology, as well as higher acquisition-related costs, which can fluctuate between periods.

Current wording

The loss ratio was 45.5 for the first nine months of 2025 and 2024. The benefit of lower catastrophe losses was offset by lower levels of favorable development on prior years’ loss reserves and a shift in the mix of business towards casualty lines, which tend to have higher non-catastrophe loss ratios than our property and surety products. The expense ratio increased to 38.5 from 37.8. Increased expenses were driven by continued investments in people and technology, as well as higher acquisition-related costs, which can fluctuate between periods.

Previous wording

Our equity in earnings of unconsolidated investees primarily relates to our investment in Prime Holdings Insurance Services, Inc. (Prime), a specialty insurance company. We recognized $5 million of investee earnings from Prime in the first six months of 2025 and $6 million in 2024.

Current wording

Our equity in earnings of unconsolidated investees primarily relates to our investment in Prime Holdings Insurance Services, Inc. (Prime), a specialty insurance company. We recognized $7 million of investee earnings from Prime in the first nine months of 2025 and $8 million in 2024.

Previous wording

Net earnings for the first six months of 2025 totaled $188 million, compared to $210 million for the same period in 2024. An increase in investment income and realized gains partially offset a decline in unrealized gains on equity securities and underwriting income, which resulted in the overall reduction in earnings.

Current wording

Net earnings for the first nine months of 2025 totaled $312 million, compared to $305 million for the same period in 2024. Higher levels of underwriting income, investment income and realized gains all contributed to the improved results.

Previous wording

Comprehensive earnings totaled $236 million for the first six months of 2025, compared to $189 million for the first six months of 2024. Other comprehensive earnings (loss) primarily included net after-tax unrealized gains (losses) from the fixed income portfolio. Other comprehensive earnings of $49 million in the first six months of 2025 was primarily attributable to lower interest rates, which increased the fair value of securities held in the fixed income portfolio. Comparatively, $21 million of other comprehensive loss was recognized in 2024, as higher interest rates decreased the fair value of securities held in the fixed income portfolio.

Current wording

Comprehensive earnings totaled $389 million for the first nine months of 2025, compared to $365 million for the first nine months of 2024. Other comprehensive earnings primarily included net after-tax unrealized gains (losses) from the fixed income portfolio. Other comprehensive earnings of $76 million in the first nine months of 2025 was primarily attributable to lower interest rates, which increased the fair value of securities held in the fixed income portfolio. Comparatively, $60 million of other comprehensive earnings was recognized in 2024.

Previous wording

Gross premiums written increased $21 million for the first six months of 2025, compared to the same period of 2024, primarily from our casualty segment. Net premiums earned increased $61 million, driven by our casualty and surety segments.

Current wording

Gross premiums written increased $24 million for the first nine months of 2025, compared to the same period of 2024, primarily from our casualty segment. Net premiums earned increased $79 million, also driven by our casualty segment.

Previous wording

Gross premiums written for the casualty segment increased $53 million in the first six months of 2025. We continued to benefit from positive rate movement across a large portion of our casualty segment, as well as from new business growth within our personal umbrella distribution channels. Premium growth for commercial excess and general liability was driven by expanded marketing efforts, while some of our competitors pulled back from the construction market, and increased construction spending in targeted markets. Other casualty premium was down for the first six months of 2025, as we exited from various captive programs, reduced our participation on the reinsurance agreement with Prime and experienced increased competition within our binding authority product.

Current wording

Gross premiums written for the casualty segment increased $76 million in the first nine months of 2025. We continued to benefit from positive rate movement across a large portion of our casualty segment, as well as from new business growth within our personal umbrella distribution channels. Premium growth for commercial excess and general liability was driven by expanded marketing efforts, while some of our competitors pulled back from the construction market, and increased construction spending in targeted markets. Other casualty premium was down for the first nine months of 2025, as we exited from various captive programs and reduced our participation on the reinsurance agreement with Prime.

Previous wording

Gross premiums written for the property segment decreased $35 million in the first six months of 2025. After several consecutive years of rate increases, rates on commercial property exposures declined in the first half of 2025, driven by more intense competition. However, new opportunities, rate increases and strong sections of the construction market led to $5 million of premium growth for our marine product. Additionally, some competitors have reduced their appetite for select Hawaii homeowner coverages, which, along with rate increases, has allowed our other property premium to grow.

Current wording

Gross premiums written for the property segment decreased $54 million in the first nine months of 2025. After several consecutive years of rate increases, rates on commercial property exposures declined in 2025, driven by more intense competition. However, new opportunities, rate increases and strong sections of the construction market led to $5 million of premium growth for our marine product. Additionally, some competitors have reduced their appetite for select Hawaii homeowner coverages, which, along with rate increases, has allowed our other property premium to grow.

Previous wording

Gross premiums written for the surety segment increased $3 million for the first six months of 2025. Transactional and commercial surety grew as result of continued marketing efforts and new regional bonding requirements. However, a slowdown in bid activity for larger public construction projects resulted in a decline in contract surety premium.

Current wording

Gross premiums written for the surety segment increased $1 million in the first nine months of 2025. Transactional and commercial surety grew as result of continued marketing efforts and new regional bonding requirements. However, a slowdown in construction spending resulted in a decline in contract surety premium.

Previous wording

The casualty segment recorded underwriting income of $10 million in the first six months of 2025, compared to $24 million for the same period last year. Prior accident years’ reserve releases reduced loss and settlement expenses for the casualty segment by $20 million in 2025, primarily on accident years 2019 through 2022 and 2024. Larger drivers of the favorable development were commercial excess, general liability and subsegments within professional liability, while auto liability exposures developed adversely for some products, most notably in commercial transportation. In comparison, $32 million of prior accident years’ reserves were released in the first six months of 2024. General liability, executive products, personal umbrella, professional services and commercial excess drove the favorable development in 2024. Storm losses on casualty-oriented package policies that include property coverage resulted in $2 million of losses in 2025 and 2024.

Current wording

The casualty segment recorded underwriting income of $15 million in the first nine months of 2025, compared to $27 million for the same period last year. Prior accident years’ reserve releases reduced loss and settlement expenses for the casualty segment by $28 million in 2025, primarily on accident years 2019 through 2022 and 2024. Larger drivers of the favorable development were commercial excess, general liability and subsegments within professional liability, while auto liability exposures developed adversely for some products, most notably in commercial transportation. In comparison, $42 million of prior accident years’ reserves were released in the first nine months of 2024. Commercial excess, general liability, professional services, executive products and personal umbrella drove the favorable development in 2024. Storm losses on casualty-oriented package policies that include property coverage resulted in $2 million of losses in 2025 and $3 million in 2024.

Previous wording

The combined ratio for the casualty segment was 97.8 in 2025, compared to 94.1 in 2024. The segment’s loss ratio was 61.9 in 2025, up from 56.8 in 2024. Lower levels of reserve releases on prior accident years and higher current year loss reserves, primarily in auto exposed lines, resulted in the higher loss ratio in 2025. The expense ratio for the casualty segment was 35.9, down from 37.3 for the same period last year, as the growth in the earned premium base exceeded the growth in expense.

Current wording

The combined ratio for the casualty segment was 97.9 in 2025, compared to 95.8 in 2024. The segment’s loss ratio was 61.9 in 2025, up from 58.9 in 2024. Lower levels of reserve releases on prior accident years and higher current year loss reserves, primarily in auto exposed lines, resulted in the higher loss ratio in 2025. The expense ratio for the casualty segment was 36.0, down from 36.9 for the same period last year, as the growth in the earned premium base exceeded the growth in expense.

Previous wording

The property segment recorded underwriting income of $106 million for the first six months of 2025, compared to $111 million for the same period last year. Underwriting results for 2025 included $28 million of favorable development on prior years’ loss and catastrophe reserves, offset by $24 million of storm and other catastrophe losses. Comparatively, the 2024 underwriting results included $25 million of favorable development on prior years’ loss and catastrophe reserves, as well as $26 million of storm losses.

Current wording

The property segment recorded underwriting income of $157 million for the first nine months of 2025, compared to $141 million for the same period last year. Underwriting results for 2025 included $32 million of favorable development on prior years’ loss and catastrophe reserves, offset by $24 million of storm and other catastrophe losses. Comparatively, the 2024 underwriting results included $33 million of favorable development on prior years’ loss and catastrophe reserves, $35 million of losses from Hurricanes Beryl and Helene, as well as $28 million of other storm losses.

Previous wording

Underwriting results for the first six months of 2025 translated into a combined ratio of 59.6, compared to 57.9 for the same period last year. The segment’s loss ratio was 27.0 in 2025, down from 28.1 in 2024, as a result of larger releases on prior accident years’ loss reserves and lower current accident year storm losses. The segment’s expense ratio increased to 32.6 in 2025 from 29.8 in the prior year, as a result of changes in our reinsurance cost and structure, as well as higher acquisition-related expenses, which can fluctuate between periods.

Current wording

Underwriting results for the first nine months of 2025 translated into a combined ratio of 59.8, compared to 64.4 for the same period last year. The segment’s loss ratio was 26.7 in 2025, down from 34.0 in 2024, as a result of lower current accident year catastrophe losses. The segment’s expense ratio increased to 33.1 in 2025 from 30.4 in the prior year, as a result of continued investments in people and technology, as well as higher acquisition-related expenses, which can fluctuate between periods.

Previous wording

The surety segment recorded underwriting income of $16 million for the first six months of 2025, compared to $13 million for the same period last year. Both periods reflected positive current accident year underwriting performance and benefited from favorable development on prior years’ loss reserves. Results for 2025 included favorable development on prior accident years’ reserves, which decreased loss and settlement expenses for the segment by $11 million. Results for 2024 included $8 million of favorable development on prior accident years’ reserves. Additionally, $2 million of reinsurance reinstatement premium was recorded in 2024 on a prior year loss, which reduced net premiums earned and underwriting income.

Current wording

The surety segment recorded underwriting income of $22 million for the first nine months of 2025, compared to $21 million for the same period last year. Both periods reflected positive current accident year underwriting performance and benefited from favorable development on prior years’ loss reserves. Results for 2025 included favorable development on prior accident years’ reserves, which decreased loss and settlement expenses for the segment by $13 million. Results for 2024 included $11 million of favorable development on prior accident years’ reserves. Additionally, $2 million of reinsurance reinstatement premium was recorded in 2024 on a prior year loss, which reduced net premiums earned and underwriting income.

Previous wording

The combined ratio for the surety segment totaled 78.2 for the first six months of 2025, compared to 81.4 for the same period in 2024. The segment’s loss ratio was 4.8 in 2025, down from 9.2 in 2024, due to higher levels of favorable prior accident years’ reserve development. The expense ratio was 73.4, up from 72.2 in the prior year.

Current wording

The combined ratio for the surety segment totaled 80.5 for the first nine months of 2025 and 2024. The segment’s loss ratio was 7.0 in 2025, down from 9.0 in 2024, due to higher levels of favorable prior accident years’ reserve development. The expense ratio was 73.5, up from 71.5 in the prior year, due to continued investments in people and technology, higher acquisition expenses, as well as differences in our reinsurance costs.

Previous wording

Our investment portfolio generated net investment income of $76 million during the first six months of 2025, an increase of 14 percent from the same period in 2024. The increase in investment income was due to higher reinvestment rates, as well as an increased average asset base relative to the prior year.

Current wording

Our investment portfolio generated net investment income of $117 million during the first nine months of 2025, an increase of 13 percent from the same period in 2024. The increase in investment income was due to higher reinvestment rates, as well as an increased average asset base relative to the prior year.

Previous wording

Yields on our fixed income investments for the first six months of 2025 and 2024 were as follows:

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Yields on our fixed income investments for the first nine months of 2025 and 2024 were as follows:

Previous wording

The fixed income portfolio increased by $245 million in the first six months of 2025, as bonds rallied and cash flows were largely allocated to the fixed income portfolio. Average fixed income duration was 4.9 years at June 30, 2025, reflecting our liability structure and sound capital position. The equity portfolio increased by $75 million during the first six months of 2025, primarily due to strength in the equity markets. Short-term investments increased by $41 million, as yields on AAA-rated government money market funds remained relatively attractive.

Current wording

The fixed income portfolio increased by $361 million in the first nine months of 2025, as bonds rallied and cash flows were largely allocated to the fixed income portfolio. Average fixed income duration was 4.8 years at September 30, 2025, reflecting our liability structure and sound capital position. The equity portfolio increased by $143 million during the first nine months of 2025, primarily due to strength in the equity markets. Short-term investments increased by $91 million, as yields on AAA-rated government money market funds remained relatively attractive.

Previous wording

Our effective tax rate for the first six months of 2025 was 20.2 percent, compared to 20.3 percent for the same period in 2024. Effective rates are dependent upon components of pretax earnings or losses and the related tax effects.

Current wording

Our effective tax rate for the first nine months of 2025 was 20.4 percent, compared to 19.8 percent for the same period in 2024. Effective rates are dependent upon components of pretax earnings or losses and the related tax effects. The effective tax rate was higher for the nine-month period in 2025 due to lower levels of tax-favored adjustments, such as tax credits and excess tax benefits on share-based compensation, and higher levels of pretax income, which decreased the percentage impact of the tax-favored adjustments.

Previous wording

Net premiums earned increased 6 percent, driven primarily by products in our casualty segment. Investment income was up 16 percent, due to an increased average asset base and higher reinvestment rates. Positive market performance resulted in $44 million of unrealized gains on equity securities in the second quarter of 2025, compared to $4 million in 2024. Realized gains during the second quarter of 2025 were comprised of $14 million of realized gains on equity securities, primarily due to rebalancing within our equity strategies, $1 million of realized losses on the fixed income portfolio and $2 million of other realized gains. This compares to $6 million of realized gains on the equity portfolio, $1 million of realized losses on the fixed income portfolio and $5 million of other realized losses during the second quarter of 2024.

Current wording

Net premiums earned increased 5 percent, driven primarily by products in our casualty and surety segments. Investment income was up 12 percent, due to an increased average asset base and higher reinvestment rates. Positive market performance resulted in $42 million of unrealized gains on equity securities in the third quarter of 2025, compared to $38 million in 2024. Realized gains during the third quarter of 2025 were comprised of $16 million of realized gains on equity securities, primarily due to rebalancing within our equity strategies, $3 million of realized gains on the fixed income portfolio and $1 million of

Previous wording

Underwriting income was $62 million on an 84.5 combined ratio for the second quarter of 2025, compared to $70 million on an 81.5 combined ratio in the same period of 2024. Underwriting results for 2025 were impacted by $14 million of pretax losses from catastrophe events, compared to $16 million in 2024. Results for each period benefited from favorable development on prior years’ loss reserves, which provided additional pretax earnings of $28 million in the second quarter of 2025, compared to $23 million in 2024.

Current wording

Underwriting income was $61 million on an 85.1 combined ratio for the third quarter of 2025, compared to $41 million on an 89.6 combined ratio in the same period of 2024. Underwriting results for 2024 were impacted by $37 million of pretax losses from Hurricanes Beryl and Helene, as well as $2 million of pretax storm losses, while minimal catastrophe losses were incurred in the third quarter of 2025. Results for each period benefited from favorable development on prior years’ loss reserves, which provided additional pretax earnings of $15 million in the third quarter of 2025, compared to $21 million in 2024.

Previous wording

The loss ratio increased to 45.9 from 44.3 due to a shift in the mix of business towards casualty lines, which tend to have higher loss ratios than our property and surety products, particularly in periods with lower catastrophe losses. The expense ratio increased to 38.6 from 37.2. Positive equity market returns resulted in more book value growth in 2025 and a corresponding increase in bonus expense accruals when compared to 2024. Increased expenses were also driven by continued investments in people and technology, as well as higher acquisition-related costs, which can fluctuate between periods.

Current wording

The loss ratio decreased to 46.1 from 51.9 due to lower catastrophe losses. The expense ratio increased to 39.0 from 37.7. Improved equity market returns resulted in more book value growth in 2025 and a corresponding increase in bonus expense accruals when compared to 2024. Increased expenses were also driven by continued investments in people and technology, as well as higher acquisition-related costs, which can fluctuate between periods.

Previous wording

Our equity in earnings of unconsolidated investees primarily relates to our investment in Prime. We recognized $3 million of investee earnings from Prime in the second quarter of 2025 and $2 million in 2024.

Current wording

Our equity in earnings of unconsolidated investees primarily relates to our investment in Prime. We recognized $2 million of investee earnings from Prime in the third quarter of 2025 and $1 million in 2024.

Previous wording

Comprehensive earnings totaled $143 million for the second quarter of 2025, compared to $74 million for the second quarter of 2024. Other comprehensive earnings (loss) primarily included net after-tax unrealized gains (losses) from the fixed income portfolio. Other comprehensive earnings of $19 million in the second quarter of 2025 was primarily attributable to lower interest rates, which increased the fair value of securities held in the fixed income portfolio. Comparatively, $8 million of other comprehensive loss was recognized in 2024, as higher interest rates decreased the fair value of securities held in the fixed income portfolio.

Current wording

Comprehensive earnings totaled $152 million for the third quarter of 2025, compared to $175 million for the third quarter of 2024. Other comprehensive earnings primarily included net after-tax unrealized gains (losses) from the fixed income portfolio. Other comprehensive earnings of $28 million in the third quarter of 2025 was primarily attributable to lower interest rates, which increased the fair value of securities held in the fixed income portfolio. Comparatively, $80 million of other comprehensive earnings was recognized in 2024.

Previous wording

Gross premiums written decreased $1 million for the second quarter of 2025, compared to the same period of 2024. Declines in the property segment offset growth in our casualty and surety segments. Net premiums earned increased $23 million, driven by the casualty segment.

Current wording

Gross premiums written increased $2 million for the third quarter of 2025, compared to the same period of 2024. Growth in our casualty segment offset declines in the property and surety segments. Net premiums earned increased $18 million, driven by the casualty segment.

Previous wording

Gross premiums written for the casualty segment increased $20 million in the second quarter of 2025. We continued to benefit from positive rate movement across a large portion of our casualty segment, as well as from new business growth within our personal umbrella distribution channels. Premium growth for commercial excess and general liability was driven by expanded marketing efforts, while some of our competitors pulled back from the construction market, and increased construction spending in targeted markets. Other casualty premium was down for the quarter as we exited from various captive programs and reduced our participation on the reinsurance agreement with Prime. Additionally, heightened competition resulted in a decrease in commercial transportation premium.

Current wording

Gross premiums written for the casualty segment increased $23 million in the third quarter of 2025. We continued to benefit from positive rate movement across a large portion of our casualty segment, as well as from new business growth within our personal umbrella distribution channels. Premium growth for commercial excess and general liability was driven by expanded marketing efforts, while some of our competitors pulled back from the construction market, and increased construction spending in targeted markets. Other casualty premium was down for the quarter as we exited from various captive programs and reduced our participation on the reinsurance agreement with Prime.

Previous wording

Gross premiums written for the property segment decreased $24 million in the second quarter of 2025. After several consecutive years of rate increases, rates on commercial property exposures declined in the second quarter of 2025, driven by more intense competition. However, some competitors have reduced their appetite for select Hawaii homeowner coverages, which, along with rate increases, has allowed our other property premium to grow.

Current wording

Gross premiums written for the property segment decreased $19 million in the third quarter of 2025. After several consecutive years of rate increases, rates on commercial property exposures declined in the third quarter of 2025, driven by more intense competition. However, some competitors have reduced their appetite for select Hawaii homeowner coverages, which, along with rate increases, has allowed our other property premium to grow.

Previous wording

The casualty segment recorded underwriting income of $8 million in the second quarter of 2025, compared to $10 million for the same period last year. Prior accident years’ reserve releases reduced loss and settlement expenses for the casualty segment by $15 million in 2025, primarily on accident years 2018 through 2020, 2022 and 2024. Larger drivers of the favorable development were commercial excess, personal umbrella, general liability and subsegments within professional liability. In comparison, $14 million of prior accident years’ reserves were released in the second quarter of 2024. Professional services, commercial excess, executive products and general liability were drivers of the favorable development in 2024. Storm losses on casualty-oriented package policies that include property coverage resulted in $1 million of losses in 2025 and 2024.

Current wording

The casualty segment recorded underwriting income of $4 million in the third quarter of 2025, compared to $3 million for the same period last year. Prior accident years’ reserve releases reduced loss and settlement expenses for the casualty segment by $8 million in 2025, primarily on accident years 2020 through 2022 and 2024. Larger drivers of the favorable development were commercial excess, general liability, executive products and personal umbrella. In comparison, $10 million of prior accident years’ reserves were released in the third quarter of 2024. Commercial excess, professional services, general liability, personal umbrella and executive products were drivers of the favorable development in 2024. In addition, underwriting results for 2024 included $2 million of hurricane and storm losses on casualty-oriented package policies that include property coverage.

Previous wording

The property segment recorded underwriting income of $50 million for the second quarter of 2025, compared to $53 million for the same period last year. Underwriting results for 2025 included $10 million of favorable development on prior years’ loss and catastrophe reserves, as well as $13 million of storm losses. Comparatively, the 2024 underwriting results included $6 million of favorable development on prior years’ loss and catastrophe reserves, as well as $15 million of storm losses.

Current wording

The property segment recorded underwriting income of $50 million for the third quarter of 2025, compared to $30 million for the same period last year. Underwriting results for 2025 included $5 million of favorable development on prior years’ loss reserves. Comparatively, the 2024 underwriting results included $8 million of favorable development on prior years’ loss and catastrophe reserves, $35 million of losses from Hurricanes Beryl and Helen, as well as $2 million of storm losses.

Previous wording

Underwriting results for the second quarter of 2025 translated into a combined ratio of 62.1, compared to 60.3 for the same period last year. The segment’s loss ratio was 29.4 in 2025, down from 30.9 in 2024, as a result of larger releases on prior accident years’ loss reserves and less current accident year storm losses. The segment’s expense ratio increased to 32.7 in 2025, up from 29.4 in the prior year, driven by changes in our reinsurance cost and structure, along with higher acquisition-related expenses, which can fluctuate between periods.

Current wording

Underwriting results for the third quarter of 2025 translated into a combined ratio of 60.2, compared to 77.2 for the same period last year. The segment’s loss ratio was 25.9 in 2025, down from 45.8 in 2024, as a result of lower catastrophe losses. The segment’s expense ratio increased to 34.3 in 2025, up from 31.4 in the prior year, driven by continued investments in people and technology, along with higher acquisition-related expenses, which can fluctuate between periods.

Previous wording

The surety segment recorded underwriting income of $4 million for the second quarter of 2025, compared to $7 million for the same period last year. Results for 2025 and 2024 included favorable development on prior accident years’ reserves, which decreased loss and settlement expenses for the segment by $2 million in each period.

Current wording

The surety segment recorded underwriting income of $6 million for the third quarter of 2025, compared to $8 million for the same period last year. Results for 2025 and 2024 included favorable development on prior accident years’ reserves, which decreased loss and settlement expenses for the segment by $3 million in each period.

Previous wording

The combined ratio for the surety segment totaled 87.9 for the second quarter of 2025, compared to 81.8 for the same period in 2024. The segment’s loss ratio was 13.3 in 2025, up from 12.7 in 2024. The expense ratio was 74.6, up from 69.1 in the prior year, due to continued investments in people and technology, as well as higher acquisition expenses.

Current wording

The combined ratio for the surety segment totaled 85.0 for the third quarter of 2025, compared to 78.8 for the same period in 2024. The segment’s loss ratio was 11.4 in 2025, up from 8.7 in 2024, due to slightly lower favorable development on prior accident years and a higher earned premium base. The expense ratio was 73.6, up from 70.1 in the prior year, due to continued investments in people and technology, as well as higher acquisition expenses.

Previous wording

Our investment portfolio generated net investment income of $39 million during the second quarter of 2025, an increase of 16 percent from the same period in 2024. The increase in investment income was due to higher reinvestment rates, as well as an increased average asset base relative to the prior year.

Current wording

Our investment portfolio generated net investment income of $41 million during the third quarter of 2025, an increase of 12 percent from the same period in 2024. The increase in investment income was due to higher reinvestment rates, as well as an increased average asset base relative to the prior year.