Kinsale Capital Group Q2 Earnings Call Highlights

Kinsale Capital Group NYSE: KNSL reported higher second-quarter operating earnings and continued underwriting profitability despite what management described as a competitive and softening excess-and-surplus, or E&S, insurance market. Chairman, President and Chief Executive Officer Michael Kehoe said diluted operating earnings per share rose 15.9% from the second quarter of 2025 to $5.54. The company generated an annualized operating return on equity of 24.4% and posted a combined ratio of 75.5% for the quarter. Gross written premium declined 5% year over year, while net written premium fell 1.4%. Net earned premium increased 8.9%. Kehoe said the company is prioritizing underwriting profitability over top-line expansion as competition varies substantially by market segment. Commercial property pressures weigh on premium Kinsale said competition was most intense in its Commercial Property Division, which writes larger layered property accounts. Kehoe said the market has experienced material rate declines and broader coverage terms, describing the environment as a buyer's market. As a result, Kinsale is writing a smaller volume of business in that division. Excluding Commercial Property, gross written premium grew 3.7% in the second quarter and 4.8% in the first half of 2026. Chief Underwriting Officer Stuart Winston said the company will not pursue growth that compromises returns. He cited favorable underwriting conditions and meaningful growth in excess casualty, commercial auto, entertainment, environmental, agribusiness casualty and energy. Construction and certain professional lines, meanwhile, remained among the areas facing softer conditions. New-business submissions increased 6% during the quarter. Excluding Commercial Property, submissions increased 8%, with more than half of Kinsale's divisions recording double-digit submission growth. Winston said the strongest activity came from small and medium-sized accounts, particularly those with premiums of $25,000 or less. Kinsale's average premium is approximately $12,000. The company said its combined pricing trend was in line with the MS Amlin pricing index, which showed a 5.9% decrease in the second quarter, compared with a 3.3% decrease in the first quarter. Underwriting results and reserve position Chief Financial Officer Bryan Petrucelli said net income increased 31.1% year over year, while net operating earnings increased 13.3%. The 75.5% combined ratio included 4.5 percentage points of favorable prior-year loss reserve development, compared with 3.9 points a year earlier. Catastrophe losses accounted for 1.3 points, versus less than one point in the 2025 quarter. The expense ratio rose to 21.7% from 20.7%, reflecting a higher net commissio...