Shares of American Coastal Insurance Corporation (NASDAQ: ACIC) surged 5.26% in after-hours trading on November 6, 2024, after the property and casualty insurer reported outstanding financial results for the third quarter ended September 30, 2024.

ACIC's net income from continuing operations skyrocketed 84.3% year-over-year to $27.7 million, driven by a 56.4% jump in total revenue to $82.1 million. This impressive top-line growth was fueled by a 48.2% increase in net premiums earned, reflecting the company's strong underwriting business expansion.

Notably, ACIC's underwriting profitability improved substantially during the quarter. The company's combined ratio, a key measure of underwriting performance, declined to 57.7% from 62.7% in the prior-year period. This favorable trend was driven by lower catastrophe losses and higher net favorable reserve development.

ACIC further benefited from a decrease in reinsurance costs as a percentage of gross earned premiums, which contributed to the overall profitability gains. The company's gross premiums earned rose 1.5% year-over-year, while net premiums earned surged 48.2%, indicating effective risk management and portfolio optimization.

In addition to robust underwriting results, ACIC's investment income grew substantially, with net investment income tripling to $6.1 million from $2.1 million in the third quarter of 2023. The company's strong financial performance and effective cost management strategies also drove improvements in key profitability metrics, including a 73.6% increase in core income and a 54.3% rise in core income per diluted share.