Lancashire (LRE) Q1 2025 TU earnings summary

Executive summary

• Gross premiums written rose 12.7% year-over-year to $712.1 million for Q1 2025, with insurance revenue up 8.7% to $458.9 million, reflecting strong business momentum and focus on profitable growth.

• Underlying premium growth reached approximately 7% in Q1, outpacing rate changes.

• Group Renewal Price Index (RPI) for Q1 2025 was 97%, indicating marginal rate softening from prior highs.

• The business demonstrated resilience and strong returns amid a challenging environment, supported by scale and diversification.

• Talent development remains a priority, with 45 internal promotions over the past year and ongoing expansion of the U.S. platform.

Financial highlights

• Gross written premiums grew by 8.7% year-over-year in Q1 2025.

• Reinsurance segment gross premiums written increased 20.7% year-over-year to $482.3 million, while insurance segment declined 0.9% to $229.8 million.

• Total investment return for Q1 2025 was 1.9%, driven by income, valuation gains from falling treasury rates, and strong private investment fund performance.

• Regulatory ECR/BSCR ratio stood at 271% as of 31 December 2024, indicating strong capital adequacy.

• Total investment portfolio and managed cash as at 31 March 2025 was $3,098.3 million.

Outlook and guidance

• Guidance for low single-digit gross written premium growth for 2025 is reaffirmed, despite a marginally negative rating environment.

• The company expects to achieve mid-teens ROE for 2025 even if loss activity matches the elevated levels of 2024, including California wildfires.

• No significant change anticipated in the underwriting portfolio shape for the remainder of 2025.

• Management remains focused on profitable growth and maintaining adequate rating levels.