Kinsale Capital KNSL delivered fourth-quarter 2024 net operating earnings of $4.62 per share, which outpaced the Zacks Consensus Estimate by 0.3%. The bottom line increased 19.4% year over year. 

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The results reflected the continued execution of the company’s strategy of disciplined underwriting and technology-enabled low costs.

Operational Update

Operating revenues jumped 17.4% year over year to $412 million. The growth can primarily be attributed to a rise in premiums, fee income, higher net investment income and other income.  Revenues, however, missed the consensus estimate by 1.5%.

Kinsale Capital Group, Inc. Price, Consensus and EPS Surprise

Kinsale Capital Group, Inc. price-consensus-eps-surprise-chart | Kinsale Capital Group, Inc. Quote

Gross written premiums increased 12.2% year over year  to $443.3 million, driven by strong submission flow from brokers and a favorable yet increasingly competitive pricing environment. Our estimate was $487 million.

Net written premiums climbed 13% year over year to $346.1 million in the quarter. Our estimate was pegged at $375.8 million. 

Net investment income increased 37.8% year over year to $41.9 million in the quarter and beat our estimate of $41.5 million. The year-over-year increase was driven by growth in the investment portfolio, generated primarily from the investment of strong operating cash flows and higher interest rates. The Zacks Consensus Estimate was pegged at $42.8 million.

Total expenses increased 23.7% year over year to $273.5 million due to a rise in losses and loss adjustment expenses, underwriting, acquisition and insurance expenses and other expense. Our estimate was pegged at $288.9 million. 

Kinsale Capital’s underwriting income was $97.9 million, which grew 15.4% year over year. The increase was due to continued growth in the business, offset in part by higher catastrophe losses. Our estimate was $64.6 million. The combined ratio deteriorated 130 basis points (bps) to 73.4 in the quarter under review. The Zacks Consensus Estimate was 76. Our estimate was 78.2

The expense ratio deteriorated 120 bps to 21.1 in the quarter. Our estimate was 22.4, while the Zacks Consensus Estimate was 20.4.

The loss ratio deteriorated 10 bps to 52.3. Our estimate for loss ratio was 55.8, while the Zacks Consensus Estimate was 56.

Financial Update

Kinsale Capital exited 2024 with cash and cash equivalents of $113.2 million, which decreased 10.6% from the 2023-end level. 

As of Dec. 31, 2024, stockholders’ equity increased 36.5% to $1.5 billion from the 2023-end level.  Book value per share was $63.75 as of Dec. 31, 2024, up 36% from the 2023 end level.

Net operating cash flows were $976.3 million in 2024, up 13.5% year over year.

Annualized operating return on equity contracted 260 bps year over year to 29.2% in 2024.

Share Repurchase

In October 2024, the board of directors authorized the repurchase of up to $100 million of common stock and repurchased $10 million worth of shares in the fourth quarter of 2024.

Zacks Rank

KNSL currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Insurers

The Travelers Companies TRV reported fourth-quarter 2024 core income of $9.15 per share, which beat the Zacks Consensus Estimate by 39.3% and improved 30.5% year over year. Travelers’ total revenues increased 10.4% from the year-ago quarter to $11.9 billion. The top-line figure beat the Zacks Consensus Estimate by 1%.

Net written premiums increased 7% year over year to a record $10.7 billion, driven by strong growth across all three segments. Our estimate was $10.8 billion. The Zacks Consensus Estimate was pegged at $926 million. TRV witnessed an underwriting gain of $1.4 billion, up 30.5% year over year. The consolidated underlying combined ratio of 84% improved 190 bps year over year.

RLI Corp. RLI reported fourth-quarter 2024 operating earnings of 41 cents per share, which missed the Zacks Consensus Estimate by 14.5%. The bottom line decreased 46.8% from the prior-year quarter. Operating revenues for the reported quarter were $436 million, up 15.3% year over year, driven by higher net premiums earned and net investment income. The top line matched the Zacks Consensus Estimate.

Gross premiums written increased 9% year over year to $473.2 million. This uptick can be attributed to the solid performance of the Casualty segment (up 18.3%). Our estimate was $550 million. Underwriting income of $22.2 million decreased 62.8% year over year. The combined ratio deteriorated 1,170 bps year over year to 94.4%. The Zacks Consensus Estimate for the metric was pegged at 96%, while our estimate was 102%.

W.R. Berkley Corporation’s WRB fourth-quarter 2024 operating income of $1.13 per share beat the Zacks Consensus Estimate by 20.2%. The bottom line improved 17.7% year over year. Operating revenues were $3.5 billion, up 9.2% year over year. The top line beat the consensus estimate by 4.2%.

W.R. Berkley’s net premiums written were $2.9 billion, up 8% year over year. The figure was lower than our estimate of $3 billion. The consolidated combined ratio (a measure of underwriting profitability) deteriorated 180 bps year over year to 90.2%. The Zacks Consensus Estimate was 91%.

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