Key Highlights

  • Net income fell 30.7% to USD 98.1 million on Investment portfolio repositioning.
  • Underwriting income rose 1.3% to USD 107.1 million; the combined ratio was 75.4%.
  • Gross written premiums fell 4.8% to USD 462.9 million.
  • Commercial Property premiums fell 26.8% amid heightened competition.

Net Income and Repositioning

Kinsale Capital (NYSE:KNSL) filed its third-quarter 2026 report on Thursday. Net Income was USD 98.1 million against USD 141.6 million, a decrease of 30.7%, which the company attributed mainly to net realized and unrealized investment losses against gains in the prior-year period, partly offset by higher net investment income and underwriting income.

In the quarter the company repositioned part of its investment portfolio to improve long-term returns. It sold certain common stock holdings and reinvested in higher-conviction equities, which reversed unrealized gains and recognized corresponding realized gains. It also sold lower-yielding fixed-maturity securities that were in a loss position and reinvested in higher-yielding bonds. Losses on those sales, previously recorded in accumulated other comprehensive loss, moved into net income and offset the Equity gains. The repositioning reduced third-quarter pretax Earnings by USD 37.6 million.

Underwriting Income

Underwriting income was USD 107.1 million against USD 105.7 million, an increase of 1.3%. Losses and loss adjustment expenses were USD 232.1 million against USD 227.2 million. The combined ratio was 75.4% against 74.9%. The company attributed the increase to growth in net earned premiums and higher favorable development of prior-year loss reserves, partly offset by lower ceding commissions as retention on its Reinsurance treaties increased.

Over nine months, net income was USD 386.6 million against USD 365.0 million, up 5.9%, on higher Underwriting income and higher net investment income. Nine-month underwriting income rose 14.3% to USD 307.0 million, and the combined ratio was 76.1% against 77.5%, helped by growth in net earned premiums and lower catastrophe losses.

Premiums by Division

Gross written premiums were USD 462.9 million against USD 486.3 million, a decrease of USD 23.4 million, or 4.8%. Property divisions fell 19.3% on heightened competition, including a 26.8% decline in Commercial Property to USD 58.8 million from USD 80.3 million. Casualty premiums grew 0.9%, helped by more bound accounts but offset by a shift toward smaller accounts.

Excess Casualty premiums rose 2.1% to USD 72.0 million and Allied Health rose 9.5% to USD 25.9 million. Small Business Casualty fell 1.7% to USD 49.4 million, General Casualty fell 6.8% to USD 43.9 million, and Construction fell 6.8% to USD 35.6 million.

The average premium per policy written was about USD 11,400 against about USD 12,900, or about USD 11,700 against USD 13,500 excluding the Personal Insurance Division. The company tied the decrease to competition, mainly on larger accounts and in Commercial Property. Over nine months, Gross Written Premiums were USD 1,472.5 million against USD 1,526.0 million, a decline of 3.5%, with 74.7% in casualty and 25.3% in property.

Reference Points

Total stockholders' equity was USD 1,919.0 million at Sept. 30 against USD 1,959.6 million at the prior comparison date. The gap between underwriting income of USD 107.1 million and net income of USD 98.1 million reflects investment results, including the USD 37.6 million repositioning effect. The combined ratio moved 50 basis points higher while premiums fell 4.8%. Items to follow include property premium trends, average premium per policy, casualty growth, reserve development, ceding commissions under higher treaty retention, and the earnings contribution from the repositioned portfolio.