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AXIS Capital Holdings Limited AXS posted fourth-quarter 2024 operating income of $2.97 per share, which beat the Zacks Consensus Estimate by 10.8%. The bottom line increased 1% year over year. The insurer’s results reflected improved net investment income and higher premiums, offset by higher expenses.

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Quarterly Operational Update of AXS

Total operating revenues of $1.6 billion missed the Zacks Consensus Estimate by 2.8%. The top line rose 6.7% year over year on higher net investment income and higher premiums earned.

Axis Capital Holdings Limited Price, Consensus and EPS Surprise

Axis Capital Holdings Limited price-consensus-eps-surprise-chart | Axis Capital Holdings Limited Quote

Net premiums written increased 14% to $1.2 billion, attributable to a 9% increase in the Insurance segment and a 64% surge in the Reinsurance segment.

Net investment income increased 5% year over year to $195.8 million, driven by income from fixed maturities portfolio due to increased yields, partially offset by lower returns on alternative investments. The Zacks Consensus Estimate was pegged at $190 million. Our estimate was $188.7 million.

Total expenses in the quarter under review increased 38.4% year over year to $1.2 billion due to higher general and administrative expenses, acquisition costs and foreign exchange gains. Our estimate was pegged at $1.3 billion.

Catastrophe and weather-related losses and net of reinsurance were $64 million, attributable to Hurricane Helene and other weather-related events.

AXIS Capital’s underwriting income was $129.5 million against a loss of $274 million in the year-ago quarter. The combined ratio improved 3040 basis points (bps) to 94.2%. The Zacks Consensus Estimate was pegged at 92%. Our estimate was 93.4%.

Segment Results

Insurance: Gross premiums written improved 7.4% year over year to $1.7 billion, driven by increases in property, accident and health, and credit and political risk lines on new business, partially offset by a decrease in cyber lines. Our estimate and the Zacks Consensus Estimate were both pegged at $1.1. billion.

Net premiums earned increased 11.9% year over year to $1 billion. Our estimate was $1 billion.

Underwriting income was $0.1 million versus a loss of $0.6 million incurred in the year ago quarter. The combined ratio deteriorated 220 bps to 90.4%. The Zacks Consensus Estimate for combined ratio was pegged at 87%.

Reinsurance: Gross premiums written increased 36.9% year over year to $275 million, driven by accident and health lines on new business, motor, accident and health, and professional lines. Our estimate was $179.5 million. Net premiums earned increased 0.7% year over year to $351 million. Our estimate was $413.7 million and the Zacks Consensus Estimate was $372 million.

Underwriting income was $0.4 million versus a loss of $212.4 million in the year-ago quarter. The combined ratio improved 7190 bps year over year to 90.9%. The Zacks Consensus Estimate for combined ratio was pegged at 118%.

Full-Year Highlights

Total operating revenues of $6.1 billion missed the Zacks Consensus Estimate by 2.8%. However, the top line rose 6.6% year over year on higher net investment income and higher premiums earned.

Net premiums written increased 13% to $5.8 billion, driven by 13% in the Insurance segment and an increase of 12% in the Reinsurance segment.

AXIS Capital’s underwriting income of $571.5 million increased more than three-fold year over year. Combined ratio of 92.3% improved 760 bps.

Financial Update

AXIS Capital exited 2024 with cash and cash equivalents of $2.1 billion, doubled from the 2023-end level. Debt was $1.3 billion at quarter-end, up 0.1% from the 2023-end level.

Book value per share increased 20.4% from 2023-end to $65.27 as of Dec. 30, 2024.

Annualized operating return on average common equity was 18% in 2024, which expanded 760 bps year over year.

Capital Deployment

AXS returned $350 million to shareholders in 2024, including share repurchases of $200 million and dividends of $150 million. The insurer had $200 million of remaining authorization as on Dec. 30, 2024.

Zacks Rank

AXS currently has 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%.

Zacks Investment Research

Selective Insurance Group, Inc. SIGI reported fourth-quarter 2024 operating income of $1.62 per share, which missed the Zacks Consensus Estimate by 18.1%. The bottom line decreased 16% from the year-ago quarter.

The quarterly results reflected average renewal pure price increases and stable retention across Standard Commercial Lines and Excess & Surplus Lines. Soft performance at Standard Personal Lines, higher expenses and poor underwriting income were offsets.

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Selective Insurance Group, Inc. Price, Consensus and EPS Surprise

Selective Insurance Group, Inc. price-consensus-eps-surprise-chart | Selective Insurance Group, Inc. Quote

Behind the Headlines

Total revenues of $1.3 billion increased 14.4% from the year-ago quarter’s figure, primarily due to higher premiums earned, net investment income and other income. The top line missed the Zacks Consensus Estimate by 1%.

On a year-over-year basis, net premiums written (NPW) rose 10% to $1.1 billion, driven by renewal pure price increases of 10.7%. The figure matched our estimate. Average renewal pure price increased 10.7%, up 3.3 points from a year ago. After-tax net investment income grew 24% year over year to $97 million.

After-tax net underwriting income was $13.3 million, which decreased 73.5% year over year. Catastrophe events were favorable $10.1 million against the year-ago period’s loss of $24.6 million. Non-catastrophe property loss and loss expenses were $178.2 million, wider than the year-ago loss of $172.1 million.

The combined ratio of 98.5% deteriorated 480 basis points (bps) year over year, while the loss and loss expense ratio deteriorated 540 bps year over year to 67.8%. The Zacks Consensus Estimate was 97.1% and our estimate was 96%.

Total expenses increased 19.2% year over year to $1.1 billion, primarily due to higher loss and loss expenses incurred, other insurance expenses, amortization of deferred policy acquisition costs and corporate expenses. The figure matched our estimate.

Segmental Results

Standard Commercial Lines’ NPW was up 9% year over year to $833.4 million. The premium growth reflected average renewal pure price increases of 8.8% and stable retention of 85%. The figure was lower than our estimate of $868.1 million.

The combined ratio deteriorated 710 bps to 100.2%. This was driven by net unfavorable prior-year casualty reserve development of $75 million. It was partially offset by lower catastrophe and non-catastrophe losses. The Zacks Consensus Estimate was 96 and our estimate was 97.3.

Standard Personal Lines’ NPW decreased 3% year over year to $103.6 million, with a renewal pure price of 27.3% and higher average policy sizes. Retention was 75%, down 12 points from a year ago, and new business decreased 49% due to deliberate profit improvement actions. The figure was lower than our estimate of $132 million.

The combined ratio improved 2,520 bps on a year-over-year basis to 91.7%. The Zacks Consensus Estimate was pegged at 102, while our estimate was 108.4.

Excess & Surplus Lines’ NPW was up 27% year over year to $152.6 million, driven by new business growth of 29% and average renewal pure price increases of 8.2%. The figure was higher than our estimate of $150.4 million.

The combined ratio deteriorated 1,690 bps to 93.1. The Zacks Consensus Estimate was pegged at 85, while our estimate was 84.3.

Full-Year Highlights

Operating earnings of $3.27 per share decreased 44% year over year and missed the Zacks Consensus Estimate by 10%.

NPW was a record $4.6 billion, up 12% year over year. Underwriting loss was $104.7 million against the year-ago period’s income of $104.9 million. The combined ratio deteriorated 650 bps to 103%. The loss and loss expense ratio deteriorated 740 basis points to 72.3%.

Financial Update

Selective Insurance exited 2024 with total assets of $13.5 billion, which was 15% above the level at the end of December 2023. Long-term debt of $507.9 million increased 1% from the 2023 level.

Debt-to-total capitalization improved 60 bps to 14% from the level as of 2023-end.

As of Dec. 31, 2024, book value per share was $47.99, up 6% year over year.

Operating return on common equity of 13.5% contracted 470 basis points year over year.

Share Repurchase and Dividend Update

During 2024, SIGI repurchased shares for $8.7 million. SIGI had $75.5 million remaining under authorization as of Dec. 31, 2024.

The board of directors authorized a quarterly cash dividend of 38 cents per share. The dividend will be paid out on March 3 to shareholders of record at the close of business on Feb. 14, 2025.

2025 Guidance

SIGI estimates a GAAP combined ratio of 96% to 97%, including net catastrophe losses of 6 points. The combined ratio estimate assumes no prior-year casualty reserve development.

Selective Insurance estimates an after-tax net investment income of $405 million.

The company expects an overall effective tax rate of 21.5% as well as weighted average shares of 61.5 million on a fully diluted basis.

Zacks Rank

Selective Insurance currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Property & Casualty Insurers

The Travelers Companies TRV reported a 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. Net investment income increased 26% year over year to $955 million. The figure was higher than our estimate of $884.9 million. The Zacks Consensus Estimate was pegged at $926 million. Travelers 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.

Net investment income increased 19% year over year to $38.8 million. The Zacks Consensus Estimate and our estimate for the metric were both pegged at $38.1 million. The investment portfolio’s total return was negative 1.1% in the quarter. Underwriting income of $22.2 million decreased 62.8% year over year. The combined ratio deteriorated 1,170 basis points (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.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. Operating revenues came in at $3.5 billion, up 9.2% year over year, on the back of higher net premiums earned as well as improved net investment income, higher insurance service fees and other income. The top line beat the consensus estimate by 4.2%.

Net investment income grew 1.3% to $317.4 million, driven by strong contributions to total return from net unrealized gains on the equity portfolio. The figure was lower than our estimate of $399.5 million. The Zacks Consensus Estimate was pegged at $342 million. Total expenses increased 8% to $2.9 billion due to higher losses and loss expenses. Our estimate was $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.

Zacks Investment Research

The Progressive Corporation’s PGR fourth-quarter 2024 earnings per share of $4.08 beat the Zacks Consensus Estimate by 19%. The bottom line increased 37.8% year over year.

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Operating revenues increased 20.3% year over year to $20.3 billion and beat the consensus estimate by 2.5%.

The Progressive Corporation Price, Consensus and EPS Surprise

The Progressive Corporation price-consensus-eps-surprise-chart | The Progressive Corporation Quote

Behind the Headlines

Net premiums written were $18.1 billion in the quarter, up 20% from $15.1 billion a year ago.

Net premiums earned grew 21% to $19.1 billion. The reported figure surpassed the Zacks Consensus Estimate of $18.7 billion.

Net realized loss on securities was $53 million versus a gain of $303 million in the year-ago quarter.

Combined ratio — the percentage of premiums paid out as claims and expenses — improved 80 basis points (bps) from the prior-year quarter’s level to 87.9.

Full-Year Highlights

Operating revenues increased 21.6% year over year to $75.1 billion, driven by 20.7% higher net premiums earned, a 49.7% increase in net investment income, a 19.7% rise in fees and 33.2% higher service.

Total expenses increased 13% to $64.7 billion, attributable to 7.5% higher losses and loss adjustment expenses, a 15.4% increase in policy acquisition costs and a 51.6% surge in other underwriting expenses.

Combined ratio improved 610 bps to 88.8.

December Policies in Force

Policies in force were solid in the Personal Lines segment, increasing 18% from the year-ago month’s figure to 33.8 million. Special Lines improved 9% to 6.5 million.

In the Personal Auto segment, Direct Auto increased 25% year over year to 14 million, while Agency Auto increased 17% to 9.8 million.

Progressive’s Commercial Auto segment rose 4% year over year to 1.1 million. The Property business had 3.5 million policies in force, up 14%.

Financial Update

Progressive’s book value per share was $43.67 as of Dec. 30, 2024, up 29.2% from $33.80 as of Dec. 30, 2023.

Return on equity in December 2024 was 36.4%, up from 30% reported in the year-ago period. The total debt-to-total capital ratio improved 420 bps to 21.2.

Zacks Rank

Progressive currently has 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%.

Zacks Investment Research