W. R. Berkley Corporation (WRB 1.09%) reported results on July 21, 2025, with net income per diluted share (GAAP) rose 8.7% year-over-year to $1.00 and annualized ROE of 19.1%. Net premiums written set a new record at $3.4 billion, while operating earnings reached $420 million.
Management updated its annual growth outlook to 8%-12%, down from the prior 10%-15% range, and highlighted ongoing discipline in underwriting and investment allocation amid evolving macro risks.
WRB achieves record net premiums and investment income
Net premiums written rose to $3.4 billion, setting a new company high and reflecting growth across all business lines, while net investment income increased to a record $379 million due to higher fixed-maturity yields and substantial cash flows.
The combined ratio before catastrophe losses was 88.4%, with the total calendar year combined ratio at 91.6%, demonstrating operational resilience despite elevated industry storm activity.
"Net premiums earned...was a quarterly record of $3.1 billion. In addition, net premiums written increased to a record $3.4 billion in the quarter with growth in all lines of business in both segments. Record net investment income of $379 million benefited from the ongoing growth in the invested assets from strong operating cash flow and new money rates on fixed maturity securities that remain comfortably above our average book yield."
— Rich Baio, Chief Financial Officer
This diversified premium and investment income expansion, alongside disciplined underwriting execution, bolsters long-term shareholder value and supports continued growth in book value per share.
WRB maintains underwriting discipline as market cycles diverge
Management indicated a decoupling of insurance product cycles, with property markets showing heightened competition, especially in large accounts, and casualty lines exhibiting sustained rate opportunities; the private client and high-hazard workers' compensation segments continue to contribute above-average performance.
The company adapts its portfolio in response to changing reinsurance discipline and views larger account competition, particularly from MGAs (managing general agents), as a temporary but intensifying dynamic.
"As we have discussed in the past, though, one of the changes that has happened over the past, I don't know, five to ten years is a decoupling of product lines as to where they are in the cycle. So the cyclical nature still exists, but where different major product lines are on the cycle, they are certainly no longer in lockstep. The property market … is becoming more competitive. The larger accounts, particularly shared and layered, is where greater competition is. The smaller accounts, it's not that there isn't competition, but it pales in comparison to the larger end of town. As far as the casualty lines, clearly, there's opportunity to get the rate that the product line needs. It is pronounced both in the primary casualty as well as the umbrella and excess."
— Rob Berkley, Chief Executive Officer
This nuanced cycle management positions the company to selectively pursue profitable growth while avoiding underwriting indiscipline common during inflection points in property and delegated authority (MGA) markets.
Capital deployment remains flexible amid shifting market dynamics
Although WRB did not repurchase shares, it returned $224 million to shareholders through ordinary and special dividends, and book value per share grew 6.8% quarter-over-quarter before dividends. The company's leverage ratio of 23.4% remains historically low.
It has over $2 billion in cash and equivalents on its balance sheet, providing ample capacity for opportunistic repurchases or acquisitions as market conditions evolve. Among those developments include a potential influx of MGA acquisition targets, as private equity sellers seek liquidity.
"We have a view as to how much capital we have and what type of surplus we have at any moment in time. It just seemed at that moment in time that the most efficient and effective way to return the money to people that belong was through a special dividend. I would strongly encourage you and others not to lead to the assumption that we are out of the repurchase market because that is not the case. We evaluate that tool along with other tools every day. We also have a view on the earnings power of the business going forward, which I would add we are quite optimistic about."
— Rob Berkley, Chief Executive Officer
This disciplined yet adaptable capital allocation approach signals readiness to take advantage of shifting valuations, particularly as indications point to a softening MGA market and greater opportunities for thoughtful deployment of excess capital.
Looking Ahead
Management projects organizational growth in the 8%-12% range for the near term, adjusting down from the prior 10%-15% expectation due to increased competition in property lines and selective underwriting, as discussed on the recent earnings call.
The outlook calls for continued high-teens to low-twenties return on equity (ROE) for the foreseeable future, reflecting confidence in both underwriting and investment portfolio positioning.
Forward guidance emphasizes maintaining disciplined rate-taking, ongoing vigilance on macro risks such as tariffs and labor costs, and a focus on profitable expansion, particularly in casualty and liability markets.
