PEORIA, Ill., April 23, 2025--(BUSINESS WIRE)--RLI Corp. (NYSE: RLI) – RLI Corp. reported first quarter 2025 net earnings of $63.2 million ($0.68 per share), compared to $127.9 million ($1.39 per share) for the first quarter of 2024. Operating earnings(1) for the first quarter of 2025 were $84.9 million ($0.92 per share), compared to $87.4 million ($0.95 per share) for the same period in 2024.
On January 15, 2025, RLI executed a two-for-one stock split of common stock. All share and per share data in this release reflect the stock split.
First Quarter
Earnings Per Diluted Share
2025
2024
Net earnings
$
0.68
$
1.39
Operating earnings (1)
$
0.92
$
0.95
(1) See discussion below: Non-GAAP and Performance Measures.
Highlights for the quarter included:
Underwriting income(1) of $70.5 million on a combined ratio(1) of 82.3.
5% increase in gross premiums written and 12% increase in net investment income.
Favorable development in prior years’ loss reserves resulted in a $27.4 million net increase in underwriting income.
Book value per share of $17.48, an increase of 6% (inclusive of dividends) from year-end 2024.
"We are pleased to report continued premium growth and profitability in the first quarter of 2025," said RLI Corp. President & CEO Craig Kliethermes. "Gross premiums written increased 5%, driven by continued momentum in our casualty segment. Strong margins in our property and surety segments contributed to an overall combined ratio of 82.3. Coupled with positive investment returns, this led to a 6% increase in book value since year-end 2024. Our performance highlights the strength and resilience of our diversified, niche specialty portfolio. I am proud of our team’s dedication to our customers and their focus on delivering results for our shareholders."
Underwriting Income
RLI achieved $70.5 million of underwriting income in the first quarter of 2025 on an 82.3 combined ratio, compared to $77.7 million on a 78.5 combined ratio in 2024.
Results for both years include favorable development in prior years’ loss reserves, which resulted in a $27.4 million and $37.4 million net increase to underwriting income in 2025 and 2024, respectively.
The following table highlights underwriting income and combined ratios by segment for the first quarter.
Underwriting Income(1)
Combined Ratio(1)
(in millions)
2025
2024
2025
2024
Casualty
$
2.1
$
13.7
Casualty
99.1
93.1
Property
56.9
57.7
Property
57.1
55.4
Surety
11.5
6.3
Surety
68.5
80.9
Total
$
70.5
$
77.7
Total
82.3
78.5
(1) See discussion below: Non-GAAP and Performance Measures.
Other Income(2)
Net investment income for the quarter increased 12% to $36.7 million, compared to the same period in 2024. The investment portfolio’s total return was 1.3% for the quarter.
RLI’s comprehensive earnings were $93.2 million for the quarter ($1.01 per share), compared to $115.2 million ($1.25 per share) for the same quarter in 2024. In addition to net earnings, comprehensive earnings for 2025 included after-tax unrealized gains from the fixed income portfolio, due to declining interest rates.
Dividends Paid in First Quarter of 2025
On March 20, 2025, the company paid a regular quarterly dividend of $0.15 per share, an increase of 3.4% over the prior quarter. RLI’s cumulative dividends total more than $967 million 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. 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 2025 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 A+ (Superior) financial strength rating was affirmed by AM Best Company for the company’s insurance subsidiaries – RLI Insurance Company, Mt. Hawley Insurance Company and Contractors Bonding and Insurance Company.
At 10 a.m. central daylight time (CDT) on April 24, 2025, 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/513071564.
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, 2024.
(2) All share and per share data reflect the 2-for-1 stock split that occurred on January 15, 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 29 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)
2025
2024
Favorable development in casualty prior years' reserves
$
5.1
$
18.1
Favorable development in property prior years' reserves
$
17.6
$
18.9
Favorable development in surety prior years' reserves
$
8.3
$
5.4
Net incurred losses related to:
2025 catastrophe events
$
(12.0)
$
—
2024 and prior catastrophe events
$
—
$
(12.0)
Operating Earnings Per Share
Three Months Ended
March 31,
2025
2024
Operating Earnings Per Share(2)(3)
$
0.92
$
0.95
Specific items included in operating earnings per share:(1) (4)
Net favorable development in casualty prior years' reserves
$
0.02
$
0.13
Net favorable development in property prior years' reserves
$
0.14
$
0.15
Net favorable development in surety prior years' reserves
$
0.07
$
0.04
Net incurred losses related to:
2025 catastrophe events
$
(0.09)
$
—
2024 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)
All share and per share data reflect the 2-for-1 stock split that occurred on January 15, 2025.
(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
2025 FINANCIAL HIGHLIGHTS
(Unaudited)
(Dollars in thousands, except per share amounts)
Three Months Ended March 31,
SUMMARIZED INCOME STATEMENT DATA:
2025
2024
% Change
Net premiums earned
$
398,345
$
360,676
10.4
%
Net investment income
36,726
32,847
11.8
%
Net realized gains
14,912
5,994
148.8
%
Net unrealized gains (losses) on equity securities
(42,318
)
45,314
NM
Consolidated revenue
$
407,665
$
444,831
(8.4
)
%
Loss and settlement expenses
177,238
143,824
23.2
%
Policy acquisition costs
123,687
110,454
12.0
%
Insurance operating expenses
26,874
28,703
(6.4
)
%
Interest expense on debt
1,335
1,618
(17.5
)
%
General corporate expenses
2,948
5,010
(41.2
)
%
Total expenses
$
332,082
$
289,609
14.7
%
Equity in earnings of unconsolidated investees
3,048
4,769
(36.1
)
%
Earnings before income taxes
$
78,631
$
159,991
(50.9
)
%
Income tax expense
15,417
32,091
(52.0
)
%
Net earnings
$
63,214
$
127,900
(50.6
)
%
Other comprehensive earnings (loss), net of tax
30,030
(12,671
)
NM
Comprehensive earnings
$
93,244
$
115,229
(19.1
)
%
Operating earnings(1):
Net earnings
$
63,214
$
127,900
(50.6
)
%
Less:
Net realized gains
(14,912
)
(5,994
)
148.8
%
Income tax on realized gains
3,132
1,259
148.8
%
Net unrealized (gains) losses on equity securities
42,318
(45,314
)
NM
Income tax on unrealized gains (losses) on equity securities
(8,888
)
9,516
NM
Operating earnings
$
84,864
$
87,367
(2.9
)
%
Return on Equity:
Net earnings (trailing four quarters)
17.6
%
24.2
%
Comprehensive earnings (trailing four quarters)
19.8
%
25.1
%
Per Share Data(2):
Diluted:
Weighted average shares outstanding (in 000's)
92,528
92,326
Net earnings per share
$
0.68
$
1.39
(51.1
)
%
Less:
Net realized gains
(0.16
)
(0.06
)
166.7
%
Income tax on realized gains
0.03
0.01
200.0
%
Net unrealized (gains) losses on equity securities
0.46
(0.49
)
NM
Income tax on unrealized gains (losses) on equity securities
(0.09
)
0.10
NM
Operating earnings per share(1)
$
0.92
$
0.95
(3.2
)
%
Comprehensive earnings per share
$
1.01
$
1.25
(19.2
)
%
Cash dividends per share - ordinary
$
0.15
$
0.14
11.1
%
Net cash flow provided by operations
$
103,514
$
70,946
45.9
%
(1)
See discussion above: Non-GAAP and Performance Measures.
(2)
All share and per share data reflect the 2-for-1 stock split that occurred on January 15, 2025.
NM = Not Meaningful
RLI CORP
2025 FINANCIAL HIGHLIGHTS
(Unaudited)
(Dollars in thousands, except per share amounts)
March 31,
December 31,
2025
2024
% Change
SUMMARIZED BALANCE SHEET DATA:
Fixed income, at fair value
$
3,274,276
$
3,175,796
3.1
%
(amortized cost - $3,448,746 at 3/31/25)
(amortized cost - $3,391,159 at 12/31/24)
Equity securities, at fair value
725,946
736,191
(1.4
)
%
(cost - $447,799 at 3/31/25)
(cost - $417,897 at 12/31/24)
Short-term investments
116,601
74,915
55.6
%
Other invested assets
60,357
57,939
4.2
%
Cash and cash equivalents
27,058
39,790
(32.0
)
%
Total investments and cash
$
4,204,238
$
4,084,631
2.9
%
Accrued investment income
27,932
28,319
(1.4
)
%
Premiums and reinsurance balances receivable
242,655
230,534
5.3
%
Ceded unearned premiums
117,790
124,955
(5.7
)
%
Reinsurance balances recoverable on unpaid losses
752,829
755,425
(0.3
)
%
Deferred policy acquisition costs
169,628
166,214
2.1
%
Property and equipment
42,328
43,172
(2.0
)
%
Investment in unconsolidated investees
56,684
56,477
0.4
%
Goodwill and intangibles
53,562
53,562
0.0
%
Income taxes - deferred
10,043
7,793
28.9
%
Other assets
51,465
77,720
(33.8
)
%
Total assets
$
5,729,154
$
5,628,802
1.8
%
Unpaid losses and settlement expenses
$
2,743,245
$
2,693,470
1.8
%
Unearned premiums
975,721
984,140
(0.9
)
%
Reinsurance balances payable
27,693
44,681
(38.0
)
%
Funds held
105,721
97,380
8.6
%
Income taxes - current
24,735
749
NM
Short-term debt
100,000
100,000
—
%
Accrued expenses
63,454
124,242
(48.9
)
%
Other liabilities
84,373
62,173
35.7
%
Total liabilities
$
4,124,942
$
4,106,835
0.4
%
Shareholders' equity
1,604,212
1,521,967
5.4
%
Total liabilities & shareholders' equity
$
5,729,154
$
5,628,802
1.8
%
OTHER DATA(1):
Common shares outstanding (in 000's)
91,773
91,738
Book value per share
$
17.48
$
16.59
5.4
%
Closing stock price per share
$
80.33
$
82.42
(2.5
)
%
Statutory surplus
$
1,787,065
$
1,787,312
(0.0
)
%
(1)
All share and per share data reflect the 2-for-1 stock split that occurred on January 15, 2025.
NM = Not Meaningful
RLI CORP
2025 FINANCIAL HIGHLIGHTS
UNDERWRITING SEGMENT DATA
(Unaudited)
(Dollars in thousands, except per share amounts)
Three Months Ended March 31,
GAAP
GAAP
GAAP
GAAP
Casualty
Ratios
Property
Ratios
Surety
Ratios
Total
Ratios
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
%
2024
Gross premiums written
$
245,329
$
180,364
$
42,982
$
468,675
Net premiums written
205,628
133,171
38,834
377,633
Net premiums earned
198,276
129,411
32,989
360,676
Net loss & settlement expenses
109,472
55.2
%
32,577
25.2
%
1,775
5.4
%
143,824
39.9
%
Net operating expenses
75,130
37.9
%
39,118
30.2
%
24,909
75.5
%
139,157
38.6
%
Underwriting income (1)
$
13,674
93.1
%
$
57,716
55.4
%
$
6,305
80.9
%
$
77,695
78.5
%
(1)
See discussion above: Non-GAAP and Performance Measures.
