Summary of PLMR Q2 2026 Earnings Call

1Key Financial Results and Metrics

Adjusted Net Income: $63.8 million, up 31% year-over-year; Adjusted EPS: $2.36, a 34% increase.

Gross Written Premium: Increased 27% to $630.5 million.

Adjusted Combined Ratio: 76.7%, up from 73.1% in Q2 2025.

Adjusted Return on Equity: 26.3%, compared to 23.7% in the prior year.

Net Earned Premium: Rose 59.5% year-over-year to $287 million.

Loss Ratio: 34.5%, up from 25.7% in Q2 2025, driven by higher attritional losses.

2Strategic Updates and Business Highlights

Diversification Strategy: Continued focus on a balanced portfolio with no single product group exceeding one-third of gross written premiums. Approximately 50% of the portfolio is property business.

Earthquake Franchise: Residential Earthquake remains stable, while Commercial Earthquake faces competitive pricing pressures.

Inland Marine and Property Group: Strong performance in residential and admitted property products, with gross written premium up 11% year-over-year.

Casualty Lines: Gross written premium increased 37% year-over-year, driven by investments in new products and partnerships.

Crop Insurance: Gross written premium surged 96% year-over-year, with the launch of the PLMR.Farm platform enhancing operational efficiency.

Surety and Credit: Gross written premium increased 236% year-over-year, with integration of the acquired Gray Surety nearly complete.

3Forward Guidance and Outlook

Full-Year Adjusted Net Income Guidance: Increased to $270 million to $280 million, implying approximately 27% growth year-over-year.

Expectations for Loss Ratios: Anticipated to be in the mid-to-upper 30s for 2026, with the third quarter expected to be the low point for net earned premium ratios.

Dividend Announcement: Initiation of a quarterly dividend of $0.45 per share, reflecting confidence in long-term growth.

4Bad News, Challenges, or Points of Concern

Competitive Pressures: Notable rate decreases in the Commercial Earthquake segment, with average rates down over 20%. The large commercial property market remains competitive.

Loss Ratio Increases: The overall loss ratio has risen, primarily due to higher attritional losses from growing lines like crop and casualty, which could impact profitability.

Market Conditions: The insurance market is described as choppy and competitive, with potential headwinds affecting growth.

5Notable Q&A Insights

Casualty Reserve Releases: Favorable reserve development was primarily from older fronted programs, particularly in workers' compensation. The company maintains a conservative reserving philosophy.

Reinsurance Strategy: Management is balancing retention and ceding based on line-by-line analysis, with a focus on maintaining profitability and managing risk.

Pipeline for Growth: There are ongoing rollovers of existing books of business, with a pipeline of potential new opportunities, though scrutiny is heightened due to current market conditions. Overall, Palomar Holdings demonstrated strong financial performance in Q2 2026, driven by a diversified portfolio and strategic initiatives, while navigating competitive pressures and rising loss ratios. The company remains optimistic about its growth trajectory and shareholder returns.