W.R. Berkley (NYSE:WRB) reported first-quarter 2026 results that executives described as a strong start to the year, driven by record net investment income and “strong underwriting profits,” while management also pointed to intensifying competition across parts of the insurance and reinsurance markets.
Quarterly results: operating income, underwriting, and catastrophe losses
Group Chief Financial Officer Rich Bao said net income for the quarter was $515 million, or $1.31 per share, and operating income was $514 million, or $1.30 per share. Bao said the quarter produced a 21.2% return on beginning-of-year stockholders’ equity, aided by lower catastrophe losses and an improved effective tax rate versus the prior year.
The current accident year loss ratio excluding catastrophes was 59.7%, compared with 59.4% a year ago, which Bao attributed to a shift in business mix “as we look to maximize profitability.” He said the insurance segment’s current accident year loss ratio ex-cat increased 10 basis points to 60.9%, while the reinsurance and monoline excess segment’s increased to 51.1%.
On expenses, Bao said the expense ratio was 28.6%, “comparable to the recent sequential quarters,” with a small impact from lower net premiums earned in reinsurance and monoline excess. He said the company still expects the 2026 expense ratio to be “comfortably below 30%,” absent material market changes.
Premium trends: insurance growth, reinsurance declines, and rate vs. growth
Despite “heightened competition in certain pockets,” Bao said the insurance segment grew gross premiums written 4.5% to $3.4 billion and net premiums written 3.2% to $2.8 billion. Net premiums written increased across all lines except workers’ compensation, he added.
The reinsurance and monoline excess segment reported net premiums written of $395 million, reflecting decreases in property and casualty lines of business, according to Bao. On the call, President and CEO Rob Berkley said the difference between gross and net results reflected a moment when it was “better to be a buyer of reinsurance than a seller of reinsurance,” which contributed to the delta between gross and net.
Rob Berkley also said the company is “actively rethinking what the balance is between rate versus growth,” after taking “a tremendous amount of rate” over the past few years. He said there are “many pockets” where margins feel strong and “the need for rate is perhaps not going to be as strong going forward,” which could lead the company to “take our foot slightly off the rate pedal” and push for growth in lines where margins are attractive.
In response to analyst questions, Berkley said the market is “overall more competitive today than it was a year ago,” but he believes there are still pockets of opportunity—particularly in parts of the liability space—where the company can pursue attractive margins.
Market conditions: competition broadens, property erosion, and caution in auto
In prepared remarks, Rob Berkley stressed that insurance remains a cyclical industry, saying the cycle is driven by “greed and fear.” He said “fear is fading and the greed is fully percolating” in parts of the market.
He highlighted a “notable shift in the appetite of the standard market,” particularly among national carriers that are “broadening their appetite” and becoming more competitive in certain pockets. He also pointed to increasing competition in reinsurance, especially in property and property catastrophe, saying the company was “taken aback” by the pace at which competition accelerated.
On the insurance side, Berkley said cat-exposed property is “definitely” eroding, while “GL and umbrella… are areas where rate is still available with good reason.” He described professional lines as “a mixed bag,” said D&O “continues to flirt with the bottom,” and flagged EPLI in certain jurisdictions—calling out Southern California—as an area to be cautious. He also reiterated concern about auto, saying it is “an area of great concern” and that the market may not have fully addressed loss cost trend.
On workers’ compensation, Berkley said the company has been “somewhat of a defensive posture” and is watching California closely, including developments at the WCIRB. He said the company expects to expand when the comp market firms.
Investments, tax rate, and capital returns
Bao said net investment income increased 12.2% to a record $404 million, driven by growth in core portfolio income to $354 million and an increase in investment fund income to $40 million. He reminded investors that investment fund income is reported on a one-quarter lag and that an average quarterly range is typically $10 million to $20 million. Bao added that operating cash flow was $668 million, which he said should continue to support investment income growth.
Rob Berkley said the investment portfolio’s book yield was about 4.7% and that “new money rate is 5+,” suggesting room for improvement. He also highlighted portfolio quality, describing it as “a very strong double A minus,” and noted flexibility to extend duration, which ended the quarter at 3.1 years.
On taxes, Bao said the effective tax rate benefited from a net non-recurring tax benefit, lowering the rate from 22.8% to 16.3% as reported. He said the company expects the remainder of 2026 to return to a normalized run rate of around 23% ±.
The company repurchased about 4.5 million common shares for $302 million and paid $34 million in regular dividends, Bao said. Stockholders’ equity increased to about $9.75 billion despite the capital management actions.
Rob Berkley pointed to financial leverage of about 22.6% and said the company is generating capital “significantly more quickly than we can consume it.” He said management expects to have “significant amounts of capital to return to shareholders for the foreseeable,” while maintaining flexibility to pursue opportunities if market conditions warrant.
About W.R. Berkley (NYSE:WRB)
W. R. Berkley Corporation (NYSE: WRB) is a publicly traded insurance holding company that underwrites and sells commercial property and casualty insurance, specialty insurance products, and reinsurance. Headquartered in Greenwich, Connecticut, the company operates a portfolio of underwriting businesses that focus on niche and specialty commercial risks, offering coverage tailored to industries such as transportation, construction, professional services and other commercial lines.
The company’s product mix includes primary and excess casualty, property, professional liability, environmental and other specialty lines, together with treaty and facultative reinsurance solutions.
