Specialty insurer Palomar Holdings, Inc. reported a net income of $51.5 million in the third quarter of 2025, up 68.7% from $30.5 million in the same period a year earlier.
Net written premiums amounted to $275.2 million, up 72.3% from $159.7 million, while net earned premiums stood at $225.1 million, up 66% from $135.6 million.
For the quarter, underwriting income was $49.2 million, up 86.1% from $26.4 million. This resulted in an improved combined ratio of 78.1%, compared to 80.5% a year earlier.
Palomar posted a higher loss ratio of 32.3%, up from 29.7%, but a lower expense ratio of 45.8%, compared to 50.8%.
Losses and loss adjustment expenses were $72.8 million, comprising $70.9 million of attritional losses and $1.9 million of catastrophe losses. The loss ratio consisted of an attritional loss ratio of 31.5% and a catastrophe loss ratio of 0.8%, compared to 20.2% and 9.5%, respectively, last year. The results also included $6.1 million of favourable prior-year development, primarily from the company’s short-tail Inland Marine and Other Property business.
Net investment income increased 54.9% to $14.6 million from $9.4 million, primarily due to higher yields on invested assets and a higher average balance of investments held during the three months ended September 30, 2025, driven by cash generated from operations and proceeds from the August 2024 public offering.
Mac Armstrong, Chairman and Chief Executive Officer, commented, “Our third quarter results were exceptional, highlighted by record gross written premium and adjusted net income. We continue to achieve strong top and bottom-line growth as gross written premium grew 44% and adjusted net income increased a stellar 70% across our unique and diverse portfolio. This strong growth underscores the stability of our balanced book of E&S and admitted residential and commercial property and casualty products. Our operating and return metrics were also impressive as we generated an adjusted combined ratio of 75%, and a 26% adjusted return on equity.
“Beyond our financial performance, we remain focused on achieving our Palomar 2X strategic imperatives. Notably, during the quarter our young crop franchise’s written premium in the quarter was well ahead of our initial estimates and in October we announced the acquisition of The Gray Casualty and Surety Company. Our investments in Crop and Surety will not only drive long-term profitable growth but also further differentiate our portfolio and better insulate us from P&C market cycles.”
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