W.R. Berkley Corporation’s WRB first-quarter 2025 operating income of $1.01 per share matched the Zacks Consensus Estimate. The bottom line, however, declined 2.9% year over year. The insurer suffered due to higher catastrophe losses, which were partially offset by higher premiums and improved net investment income. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)
Behind the Headlines
W.R. Berkley’s net premiums written were $3.1 billion, up 9.9% year over year. The figure was higher than our estimate of $3 billion.
Operating revenues came in at $3.5 billion, up 9.3% 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 2.2%.
W.R. Berkley Corporation Price, Consensus and EPS Surprise
W.R. Berkley Corporation Price, Consensus and EPS Surprise
Net investment income grew 12.6% to $360.3 million, reflecting the impact of higher new money rates on the growing fixed-maturity portfolio and improvement in investment fund income. The figure was lower than our estimate of $380.4 million. The Zacks Consensus Estimate was pegged at $346 million. Solid operating cash flow continues to drive growth in net investable assets.
Total expenses increased 12.2% to $3 billion due to higher losses and loss expenses. Our estimate was $2.8 billion. The loss ratio deteriorated 290 basis points (bps) to 63.1, while the expense ratio improved 80 basis points year over year to 27.8.
Catastrophe losses of $111.1 million in the quarter were wider than $30 million incurred in the year-ago quarter. The consolidated combined ratio (a measure of underwriting profitability) deteriorated 210 bps year over year to 90.9. The Zacks Consensus Estimate was 91.
Segment Details
Net premiums written at the Insurance segment increased 10.2% year over year to $2.7 billion in the quarter, primarily due to higher premiums from other liability, short-tail lines, auto, workers' compensation and professional liability. The figure was higher than our estimate of $2.6 billion.
The combined ratio deteriorated 150 bps to 91.7. The Zacks Consensus Estimate was 90. Our estimate was 89.7.
Net premiums written in the Reinsurance & Monoline Excess segment increased 8.2% year over year to $438.8 million due to higher premiums at Casualty, Property and Monoline excess. The figure was higher than our estimate of $415.7 million. The combined ratio deteriorated 580 bps to 85.4. The Zacks Consensus Estimate was 89. Our estimate was 85.8.
Financial Update
W.R. Berkley exited the first quarter of 2025 with total assets worth $41.3 billion, up 2.2% from year-end 2024. Senior notes and other debt remained flat from 2024 end levels at $1.8 billion.
Book value per share increased 6.4% from 2024 end levels to $23.50 as of March 31, 2024.
Cash flow from operations was $743.8 billion in the first quarter of 2025, down 0.3% year over year.
Operating return on equity contracted 340 bps to 19.3%.
WRB returned $49.2 million through share buybacks in the first quarter of 2025.
Zacks Rank
WRB currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Peer Performance
The Travelers Companies TRV reported first-quarter 2025 core income of $1.91 per share, which beat the Zacks Consensus Estimate of 69 cents. The bottom line, however, declined 29.3% year over year. Travelers’ total revenues increased 6.1% from the year-ago quarter to $11.9 billion, primarily driven by higher premiums, net investment income and other revenues. The top-line figure, however, missed the Zacks Consensus Estimate of $12.1 billion.
Net written premiums increased 3% year over year to a record $10.5 billion, driven by strong growth across all three segments. Our estimate was $10.2 billion. Underlying underwriting income of $1.6 billion improved more than 30% year over year, driven by strong net earned premiums.
The consolidated underlying combined ratio of 84.8 improved 290 basis points (bps) year over year. The combined ratio deteriorated 860 bps year over year to 102.5 due to higher catastrophe losses. The Zacks Consensus Estimate was pegged at 105.
The Progressive Corporation’s PGR first-quarter 2025 earnings per share of $4.65 missed the Zacks Consensus Estimate of $4.72. The bottom line, however, increased 24.6% year over year. Operating revenues increased 20.7% year over year to $20.6 billion, driven by 20.2% higher net premiums earned, a 31.7% increase in net investment income, a 21.6% rise in fees and 32.1% higher service revenues. The top line beat the Zacks Consensus Estimate of $20.4 billion.
Net premiums earned grew 20% to $19.4 billion. The reported figure surpassed the Zacks Consensus Estimate of $19.2 billion. Combined ratio — the percentage of premiums paid out as claims and expenses — improved 10 basis points (bps) from the prior-year quarter’s level to 86.
An Upcoming Release
RLI Corporation RLI will report first-quarter 2025 results on April 23, after market closes. The Zacks Consensus Estimate for first-quarter earnings per share is pegged at 90 cents, suggesting a decrease of 5.3% from the year-ago quarter’s reported figure.
RLI’s earnings beat estimates in three of the last four quarters, while missing in one.
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