RLI Reports First Quarter 2026 Results

RLI Reports First Quarter 2026 Results PEORIA, Ill.--( BUSINESS WIRE)--RLI Corp. (NYSE: RLI) reported first quarter 2026 net earnings of $54.9 million ($0.60 per share), compared to $63.2 million ($0.68 per share) for the first quarter of 2025. Operating earnings (1) for the first quarter of 2026 were $76.8 million ($0.83 per share), compared to $82.5 million ($0.89 per share) for the same period in 2025.

"We entered 2026 with positive underwriting results, delivering an 86 combined ratio across our diversified specialty portfolio.”

First Quarter

Earnings Per Diluted Share

2026

2025

Net earnings

0.60

0.68

Operating earnings (1)(2)

0.83

0.89

(1)

See discussion below: Non-GAAP and Performance Measures.

(2)

Equity in earnings of unconsolidated investees and the related taxes were removed from operating earnings and operating earnings per share, resulting in consistent exclusion of unrealized changes in equity investments from operating results. Prior period amounts have been recast to conform to the current definition.

Highlights for the quarter included:

"We entered 2026 with positive underwriting results, delivering an 86 combined ratio across our diversified specialty portfolio,” said RLI Corp. President & CEO Craig Kliethermes. “Our core performance remained solid to start the year. Gross premiums written grew 3%, led by our casualty segment, and net investment income increased 15%, contributing meaningfully to quarterly results and reflecting the continued strength of our investment portfolio.”

“In a dynamic market, we remain focused on disciplined underwriting, rate adequacy and strategically deploying capital to take advantage of opportunities and reward our shareholders.”

Underwriting Income

RLI achieved $57.8 million of underwriting income in the first quarter of 2026 on an 86.0 combined ratio, compared to $70.5 million on an 82.3 combined ratio in 2025.

Results for both years include favorable development in prior years’ loss reserves, which resulted in a $31.3 million and $27.4 million net increase to underwriting income in 2026 and 2025, respectively.

The following table highlights underwriting income and combined ratios by segment for the first quarter.

Underwriting Income (1)

Combined Ratio (1)

(in millions)

2026

2025

2026

2025

Casualty

7.3

2.1

Casualty

97.1

99.1

Property

48.2

56.9

Property

61.9

57.1

Surety

2.3

11.5

Surety

93.7

68.5

Total

57.8

70.5

Total

86.0

82.3

(1) See discussion below: Non-GAAP and Performance Measures.

Other Income

Net investment income for the quarter increased 15% to $42.3 million, compared to the same period in 2025. The investment portfolio’s total return was -0.4% for the quarter.

RLI’s comprehensive earnings were $29.5 million for the quarter ($0.32 per share), compared to $93.2 million ($1.01 per share) for the same quarter in 2025. In addition to net earnings, comprehensive earnings for 2026 included after-tax unrealized losses from the fixed income portfolio, due to rising interest rates.

Dividends Paid in First Quarter of 2026

On March 16, 2026, the company paid a regular quarterly dividend of $0.16 per share, the same amount as the prior quarter. RLI’s cumulative dividends total more than $1.1 billion paid over the last five years.

Non-GAAP and Performance Measures

Management has included certain non-generally accepted accounting principles (non-GAAP) financial measures in presenting the company’s results. Management believes that these non-GAAP measures further explain the company’s results of operations and allow for a more complete understanding of the underlying trends in the company’s business. These measures should not be viewed as a substitute for those determined in accordance with generally accepted accounting principles (GAAP). In addition, our definitions of these items may not be comparable to the definitions used by other companies.

Operating earnings and operating earnings per share (EPS) consist of our GAAP net earnings adjusted by net realized gains/(losses), net unrealized gains/(losses) on equity securities and taxes related thereto. Equity in earnings of unconsolidated investees and the related taxes were excluded from operating earnings and operating EPS beginning in the fourth quarter of 2025. The change was made to present a consistent approach in excluding all unrealized changes in equity investments. Operating earnings and operating EPS for prior periods have been recast to conform to the current definition. Net earnings and net earnings per share are the GAAP financial measures that are most directly comparable to operating earnings and operating EPS. A reconciliation of the operating earnings and operating EPS to the comparable GAAP financial measures is included in the 2026 financial highlights below.

Underwriting income or profit represents the pretax profitability of our insurance operations and is derived by subtracting loss and settlement expenses, policy acquisition costs and insurance operating expenses from net premium earned, which are all GAAP financial measures. The combined ratio, which is derived from components of underwriting income, is a performance measure commonly used by property and casualty insurance companies and is calculated as the sum of loss and settlement expenses, policy acquisition costs and insurance operating expenses, divided by net premiums earned, which are all GAAP measures.

Other News

During the first quarter, the company’s AM Best financial strength rating was upgraded to A++ (Superior) for the company’s insurance subsidiaries – RLI Insurance Company, Mt. Hawley Insurance Company and Contractors Bonding and Insurance Company. AM Best also upgraded the Long-Term Issuer Credit Ratings (ICR) for each RLI company to “aa+” (Superior) and upgraded the ICR of RLI’s publicly traded parent holding company, RLI Corp., to “a+” (Excellent).

At 12 p.m. central daylight time (CDT) on April 23, 2026, RLI management will hold a conference call to discuss quarterly results with insurance industry analysts. Interested parties may listen to the discussion at https://events.q4inc.com/attendee/570395995.

Except for historical information, this news release may include forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934) including, without limitation, statements reflecting our current expectations about the future performance of our company or our business segments or about future market conditions. These statements are subject to certain risk factors that could cause actual results to differ materially. Various risk factors that could affect future results are listed in the company's filings with the Securities and Exchange Commission, including the Form 10-K Annual Report for the year ended December 31, 2025.

About RLI

RLI Corp. (NYSE: RLI) is a specialty insurer serving niche property, casualty and surety markets. The company provides deep underwriting expertise and superior service to commercial and personal lines customers nationwide. RLI’s products are offered through its insurance subsidiaries – RLI Insurance Company, Mt. Hawley Insurance Company and Contractors Bonding and Insurance Company. All of RLI’s insurance subsidiaries are rated A++ (Superior) by AM Best Company. RLI has paid and increased regular dividends for 50 consecutive years and delivered underwriting profits for 30 consecutive years. To learn more about RLI, visit www.rlicorp.com.

Supplemental disclosure regarding the earnings impact of specific items:

Reserve Development (1) and Catastrophe Losses,

Net of Reinsurance

Three Months Ended

March 31,

(Dollars in millions, except per share amounts)

2026

2025

Favorable development in casualty prior years' reserves

14.5

5.1

Favorable development in property prior years' reserves

20.6

17.6

Favorable development in surety prior years' reserves

0.4

8.3

Net incurred losses related to:

2026 catastrophe events

(16.0)

—

2025 and prior catastrophe events

—

(12.0)

Operating Earnings Per Share

Three Months Ended

March 31,

2026

2025

Operating Earnings Per Share (2)(3)

0.83

0.89

Specific items included in operating earnings per share: (1)(4)

Net favorable development in casualty prior years' reserves

0.10

0.02

Net favorable development in property prior years' reserves

0.16

0.14

Net favorable development in surety prior years' reserves

—

0.07

Net incurred losses related to:

2026 catastrophe events

(0.12)

—

2025 and prior catastrophe events

—

(0.09)

(1)

Reserve development reflects changes from previously estimated losses.

(2)

See discussion above: Non-GAAP and Performance Measures.

(3)

Equity in earnings of unconsolidated investees and the related taxes were removed from operating earnings and operating earnings per share beginning in the fourth quarter of 2025, resulting in consistent exclusion of unrealized changes in equity investments from operating results. Prior period amounts have been recast to conform to the current definition.

(4)

Items included in operating earnings per share are after tax and incorporates incentive and profit sharing-related impacts which affected policy acquisition, insurance operating and general corporate expenses.

RLI CORP

2026 FINANCIAL HIGHLIGHTS

(Unaudited)

(Dollars in thousands, except per share amounts)

Three Months Ended March 31,

SUMMARIZED INCOME STATEMENT DATA:

2026

2025

% Change

Net premiums earned

411,386

398,345

3.3

Net investment income

42,321

36,726

15.2

Net realized gains

9,559

14,912

(35.9)

Net unrealized gains (losses) on equity securities

(39,396)

(42,318)

(6.9)

Consolidated revenue

423,870

407,665

4.0

Loss and settlement expenses

193,244

177,238

9.0

Policy acquisition costs

132,075

123,687

6.8

Insurance operating expenses

28,280

26,874

5.2

Interest expense on debt

2,353

1,335

76.3

General corporate expenses

2,724

2,948

(7.6)

Total expenses

358,676

332,082

8.0

Equity in earnings of unconsolidated investees

2,147

3,048

(29.6)

Earnings before income taxes

67,341

78,631

(14.4)

Income tax expense

12,456

15,417

(19.2)

Net earnings

54,885

63,214

(13.2)

Other comprehensive earnings (loss), net of tax

(25,366)

30,030

Comprehensive earnings

29,519

93,244

(68.3)

Operating earnings (1):

Net earnings

54,885

63,214

(13.2)

Less:

Net realized gains

(9,559)

(14,912)

(35.9)

Income tax on realized gains

2,007

3,132

(35.9)

Net unrealized (gains) losses on equity securities

39,396

42,318

(6.9)

Income tax on unrealized gains (losses) on equity securities

(8,273)

(8,888)

(6.9)

Equity in earnings of unconsolidated investees

(2,147)

(3,048)

(29.6)

Income tax on equity in earnings of unconsolidated investees

451

641

(29.6)

Operating earnings (2)

76,760

82,457

(6.9)

Return on Equity:

Net earnings

22.5

17.6

Comprehensive earnings

24.2

19.8

Per Share Data:

Diluted:

Weighted average shares outstanding (in 000's)

92,187

92,528

Net earnings per share

0.60

0.68

(11.8)

Less:

Net realized gains

(0.10)

(0.16)

(37.5)

Income tax on realized gains

0.01

0.03

(66.7)

Net unrealized (gains) losses on equity securities

0.43

0.46

(6.5)

Income tax on unrealized gains (losses) on equity securities

(0.09)

(0.0)

Equity in earnings of unconsolidated investees

(0.02)

(0.03)

(33.3)

Income tax on equity in earnings of unconsolidated investees

—

Operating earnings per share (1)(2)

0.83

0.89

(6.7)

Comprehensive earnings per share

0.32

1.01

(68.3)

Cash dividends per share - ordinary

0.16

0.15

6.7

Net cash flow provided by operations

42,829

103,514

(58.6)

(1)

See discussion above: Non-GAAP and Performance Measures.

(2)

RLI CORP

2026 FINANCIAL HIGHLIGHTS

(Unaudited)

(Dollars in thousands, except per share amounts)

March 31,

December 31,

2026

2025

% Change

SUMMARIZED BALANCE SHEET DATA:

Fixed income, at fair value

3,528,692

3,533,336

(0.1)

(amortized cost - $3,669,921 at 3/31/26)

(amortized cost - $3,642,362 at 12/31/25)

Equity securities, at fair value

864,912

898,876

(3.8)

(cost - $539,859 at 3/31/26)

(cost - $534,311 at 12/31/25)

Short-term investments

386,219

120,562

Other invested assets

60,509

59,281

2.1

Cash and cash equivalents

49,121

51,565

(4.7)

Total investments and cash

4,889,453

4,663,620

4.8

Accrued investment income

30,456

30,026

1.4

Premiums and reinsurance balances receivable

243,451

212,226

14.7

Ceded unearned premiums

118,476

124,669

(5.0)

Reinsurance balances recoverable on unpaid losses

740,503

746,798

(0.8)

Deferred policy acquisition costs

176,187

172,648

2.0

Property and equipment

39,809

40,733

(2.3)

Investment in unconsolidated investees

56,053

53,521

4.7

Goodwill and intangibles

53,562

0.0

Other assets

53,873

63,683

(15.4)

Total assets

6,401,823

6,161,486

3.9

Unpaid losses and settlement expenses

2,927,929

2,886,819

1.4

Unearned premiums

991,717

991,636

0.0

Reinsurance balances payable

23,455

40,580

(42.2)

Funds held

134,215

127,242

5.5

Income taxes - current

26,797

29,724

(9.8)

Income taxes - deferred

5,566

21,769

(74.4)

Short-term debt

50,000

100,000

(50.0)

Long-term debt

297,247

—

Accrued expenses

68,016

128,597

(47.1)

Other liabilities

80,491

56,923

41.4

Total liabilities

4,605,433

4,383,290

5.1

Shareholders' equity

1,796,390

1,778,196

1.0

Total liabilities & shareholders' equity

6,401,823

6,161,486

3.9

OTHER DATA:

Common shares outstanding (in 000's)

91,934

91,879

Book value per share

19.54

19.35

1.0

Closing stock price per share

57.04

63.98

(10.8)

Statutory surplus

1,814,648

1,846,615

(1.7)

NM = Not Meaningful

RLI CORP

2026 FINANCIAL HIGHLIGHTS

UNDERWRITING SEGMENT DATA

(Unaudited)

(Dollars in thousands, except per share amounts)

Three Months Ended March 31,

GAAP

Casualty

Ratios

Property

Ratios

Surety

Ratios

Total

Ratios

2026

Gross premiums written

307,014

154,763

42,109

503,886

Net premiums written

260,372

118,393

38,895

417,660

Net premiums earned

248,566

126,378

36,442

411,386

Net loss & settlement expenses

152,832

61.5

33,854

26.8

6,558

18.0

193,244

47.0

Net operating expenses

88,441

35.6

44,339

35.1

27,575

75.7

160,355

39.0

Underwriting income (1)

7,293

97.1

48,185

61.9

2,309

93.7

57,787

86.0

2025

Gross premiums written

278,454

170,052

42,600

491,106

Net premiums written

235,607

121,736

39,748

397,091

Net premiums earned

229,048

132,544

36,753

398,345

Net loss & settlement expenses

145,835

63.7

32,725

24.7

(1,322)

(3.6)

177,238

44.5

Net operating expenses

81,142

35.4

42,904

32.4

26,515

72.1

150,561

37.8

Underwriting income (1)

2,071

99.1

56,915

57.1

11,560

68.5

70,546

82.3

(1) See discussion above: Non-GAAP and Performance Measures.

Category: Earnings Release