Palomar (PLMR) investor relations material

Business Model, Differentiation, and Strategic Direction

• Focuses on specialty insurance niches underserved by standard and E&S markets, leveraging data analytics, underwriting, and risk transfer expertise to build leadership positions.

• Maintains flexibility in distribution, working with wholesalers, retailers, and other insurers, and is agnostic to how risks are sourced.

• Employs technology and AI to streamline operations, enhance risk selection, and optimize reinsurance spend, driving speed-to-market and operational efficiency.

• Anchors growth on earthquake insurance and specialty lines, with nationwide reach and multi-channel distribution.

• Experienced management team with a conservative growth and reserving philosophy.

Growth Strategy and Financial Performance

• Launched the Palomar 2X strategy in 2022, aiming to double adjusted net income in 3–5 years while maintaining adjusted ROE above 20%.

• Achieved doubling of adjusted net income in less than three years and expects to sustain this growth trajectory.

• Q1 2026 gross written premium reached $629.8M, up 42% YoY; adjusted net income was $63.1M, up 23% YoY; adjusted ROE was 27% and combined ratio 76%.

• Growth is broad-based across all segments, with casualty up 55%, surety/credit up 130%, and crop up 82% in Q1.

• Raised 2026 net income guidance to $266–$280 million, implying 26% adjusted net income growth and ROE above 20%.

Portfolio, Risk Management, and Market Cycle Navigation

• Diversified specialty portfolio across earthquake, marine/property, casualty, crop, and surety/credit, with a balanced mix between admitted and E&S offerings.

• Third-largest earthquake insurer in the US, with recent reinsurance activity securing $3.92B earthquake limit and expanded property capacity, including a new Hawaii hurricane tranche.

• Uses comprehensive reinsurance strategies—facultative, quota share, excess of loss, and catastrophe bonds—to limit exposure and support margin stability.

• Crop is the fastest-growing line, expected to grow 35% this year and targeted to become a billion-dollar business long-term.

• Maintains flexibility to lean into stable or growing segments and pull back from pressured areas as market conditions shift.