NEW YORK--(BUSINESS WIRE)--February 24, 2026--
Bowhead Specialty Holdings Inc. (NYSE: BOW), a specialty lines insurance group focused on providing casualty, professional liability and healthcare liability insurance products, delivered through complementary "craft" and "digital" underwriting models, today announced financial results for the fourth quarter and year ended December 31, 2025(1) .
Fourth Quarter 2025 Highlights
-- Gross written premiums increased 21.3% to $224.1 million.
-- Net income of $14.8 million, or $0.44 per diluted share.
-- Adjusted net income(2) of $15.5 million, or $0.47 per diluted
share(2).
-- Return on equity of 13.5% and adjusted return on equity(2) of 14.1%.
-- Book value per share $13.70 and diluted book value per share of
$13.45.
Full Year 2025 Highlights
-- Gross written premiums increased 24.0% to $862.8 million.
-- Net income of $53.8 million, or $1.59 per diluted share.
-- Adjusted net income(2) of $55.6 million, or $1.65 per diluted
share(2).
-- Return on equity of 13.1% and adjusted return on equity(2) of 13.6%.
Bowhead Chief Executive Officer, Stephen Sills, commented, "Bowhead had a great year in 2025. Gross written premiums grew more than 21% in the fourth quarter, and 24% for the full year. At the start of the year, we expected a low 30s expense ratio for the full year of 2025 but achieved an expense ratio below 30% starting in the third quarter and for the full year of 2025. With these accomplishments, Bowhead's adjusted net income for the year grew over 30%, adjusted return on equity was 13.6%, and diluted adjusted earnings per share was $1.65."
"With a strong year behind us, I'm even more excited about Bowhead's future. Over the past five years, we've built a highly effective "craft" underwriting model driven by experienced underwriters who excel at writing large and complex risks. In the second half of 2024, we supplemented this foundation by launching our complementary "digital" underwriting model, starting with Baleen, targeting small, harder-to-place risks with more restrictive coverage. In Baleen's first full year, we generated over $21 million in premiums -- an important milestone that validates our digital strategy. Since then, we've leveraged technology to streamline the submission, underwriting, and servicing of our existing Bowhead products, a capability we call "express", to address small and mid-sized accounts, beginning with our small cyber liability products."
"While we continue to expect a GWP growth of around 20% in 2026 driven by our Casualty division, our digital expansion marks a major step forward for Bowhead, positioning us well to deliver sustainable and profitable growth across market cycles."
Underwriting Results
The 21.3% increase in gross written premiums to $224.1 million in the fourth quarter of 2025 was driven by our increasing renewal book, new business and the continued growth in our platform across all divisions:
-- Our Casualty division led the growth with a 25.5% increase to $132.9
million;
-- Professional Liability increased 4.2% to $47.9 million;
-- Healthcare Liability increased 7.7% to $34.2 million; and
-- Baleen Specialty increased 665.6% to $9.1 million.
Due to the timing of our independent actuarial review in fourth quarter of each year, we consider our full-year loss ratio a more meaningful metric. Our loss ratio for the year of 66.7% increased 2.3 points compared to 64.4% in 2024.
Our current accident year loss ratio increased 1.8 points due in part to higher expected loss ratios on certain reserves within Professional Liability and Healthcare Liability to align more closely with industry expected loss ratios and our own limited loss experience. The increase was also due to mix changes in our portfolio, where Casualty, which had comparatively higher expected loss ratios, comprised a larger proportion of our net earned premiums compared to the prior year.
Similar to previous quarters in 2025, the 0.5 point increase in our prior accident year loss ratio was due to expected loss ratios applied to audit premiums fully earned in the year, but associated with prior accident years. This increase was not based on actual losses settling for more than reserved, and did not represent an increase in estimated reserves on unresolved claims. We are simply putting loss reserves into the appropriate accident year regardless of when the premiums are billed and earned. As part of our annual independent actuarial reserve review, we also reallocated prior accident year loss reserves between accident years and by division, primarily from Casualty to Professional Liability, resulting in no prior accident year development on an aggregate basis.
Due to Bowhead's limited loss experience, we continue to hold expected loss ratios that rely on development patterns and other inputs primarily based on industry data.
Our expense ratio decreased 1.0 point to 29.1% in the fourth quarter of 2025 and 1.6 points to 29.8% in for the year ended December 31, 2025. The full year decrease from 31.4% in 2024 was primarily driven by a reduction in our operating expense ratio, which was partially offset by the increase in our net acquisition ratio. The decrease in our operating expenses ratio was due to the continued scaling of our business, where net earned premiums grew at a higher rate than our expenses, as well as the prudent management of our expenses. The increase in our net acquisition costs ratio was driven by the increase in earned broker commissions due to changes in our portfolio mix and, to a lesser extent, the increase in the ceding fee we pay to American Family.
Investment Results
Net investment income increased 35.8% in the fourth quarter of 2025 to $16.6 million and 44.1% to $57.8 million for the year ended December 31, 2025, driven by a higher balance of investments and, to a lesser extent, higher yields on invested assets. Our investment portfolio, which included cash equivalents, had a book yield of 4.6% and a new money rate of 4.5% at the end of the year.
The weighted average effective duration of our investment portfolio, which included cash equivalents, was 3.0 years and had an average rating of "AA" at December 31, 2025.
__________________
(1) Comparisons in this release are made to December 31, 2024 financial
results unless otherwise noted.
(2) Non-GAAP financial measure. See "Reconciliation of Non-GAAP Financial
Measures" for a reconciliation of the non-GAAP financial measures to
their most directly comparable U.S. GAAP measures.
Summary of Operating Results
The following table summarizes the Company's results of operations for the three and twelve months ended December 31, 2025 and 2024:
Three Months Ended December 31, Twelve Months Ended December 31,
-------------------------------------- ----------------------------------------
2025 2024 % Change 2025 2024 % Change
------- ------- ---------- -------- -------- ----------
($ in thousands, except percentages and per share data)
Gross written
premiums $224,081 $184,769 21.3% $ 862,806 $ 695,717 24.0%
Ceded written
premiums (80,540) (64,585) 24.7% (304,619) (244,295) 24.7%
------- ------- ------ -------- -------- ------
Net written
premiums $143,541 $120,184 19.4% $ 558,187 $ 451,422 23.7%
======= ======= ====== ======== ======== ======
Revenues
Net earned
premiums $134,317 $106,864 25.7% $ 491,677 $ 385,111 27.7%
Net investment
income 16,553 12,193 35.8% 57,827 40,121 44.1%
Net realized
investment gains
(losses) 73 -- NM 43 (16) 368.8%
Other
insurance-related
income 735 274 168.2% 2,042 444 359.9%
------- ------- ------ -------- -------- ------
Total revenues 151,678 119,331 27.1% 551,589 425,660 29.6%
Expenses
Net losses and
loss adjustment
expenses 91,087 66,937 36.1% 328,022 248,099 32.2%
Net acquisition
costs 13,166 9,130 44.2% 46,513 32,397 43.6%
Operating expenses 26,640 23,352 14.1% 102,264 89,112 14.8%
Non-operating
expenses 95 622 (84.7)% 1,425 2,807 (49.2)%
Warrant expense 792 792 NM 3,142 1,917 63.9%
Interest expense
and financing
fees 1,243 248 401.2% 2,012 725 177.5%
Loss on
extinguishment of
credit facility 862 -- NM 862 -- NM
Foreign exchange
(gains) losses (14) 1 NM 50 68 (26.5)%
------- ------- ------ -------- -------- ------
Total expenses 133,871 101,082 32.4% 484,290 375,125 29.1%
Income before income
taxes 17,807 18,249 (2.4)% 67,299 50,535 33.2%
Income tax expense (2,963) (4,642) (36.2)% (13,513) (12,292) 9.9%
------- ------- ------ -------- -------- ------
Net income $ 14,844 $ 13,607 9.1% $ 53,786 $ 38,243 40.6%
======= ======= ====== ======== ======== ======
Key Operating and
Financial Metrics:
Adjusted net
income(1) $ 15,531 $ 14,099 10.2% $ 55,598 $ 42,686 30.2%
Loss ratio 67.8% 62.6% 66.7% 64.4%
Expense ratio 29.1% 30.1% 29.8% 31.4%
Combined ratio 96.9% 92.7% 96.5% 95.8%
Return on
equity(2) 13.5% 14.8% 13.1% 13.6%
Adjusted return on
equity(1)(2) 14.1% 15.3% 13.6% 15.2%
Diluted earnings
per share $ 0.44 $ 0.41 7.3% $ 1.59 $ 1.29 23.3%
Diluted adjusted
earnings per
share(1) $ 0.47 $ 0.42 11.9% $ 1.65 $ 1.44 14.6%
__________________
NM - Percentage change is not meaningful.
(1) Non-GAAP financial measure. See "Reconciliation of Non-GAAP Financial
Measures" for a reconciliation of the non-GAAP financial measures to
their most directly comparable U.S. GAAP measures.
(2) For the three months ended December 31, 2025 and 2024, net income and
adjusted net income are annualized to arrive at return on equity and
adjusted return on equity.
Condensed Consolidated Balance Sheets
December 31, December 31,
2025 2024
---------------------- -----------------
($ in thousands, except share data)
Assets
Investments
Fixed maturity securities,
available for sale, at fair
value (amortized cost of
$1,364,228 and $894,145,
respectively) $ 1,371,006 $ 879,989
Short-term investments, at
amortized cost, which
approximates fair value -- 9,997
--- ----------------- -------------
Total investments 1,371,006 889,986
Cash and cash equivalents 193,545 97,476
Restricted cash and cash
equivalents 40,225 124,582
Accrued investment income 10,958 7,520
Premium balances receivable 84,415 63,672
Reinsurance recoverable, net 399,676 255,072
Prepaid reinsurance premiums 191,821 152,567
Deferred policy acquisition
costs 35,284 27,625
Property and equipment, net 10,636 6,845
Income taxes receivable 3,073 586
Deferred tax assets, net 22,476 20,340
Other assets 8,261 7,971
--- ----------------- -------------
Total assets $ 2,371,376 $ 1,654,242
=== ================= =============
Liabilities
Reserve for losses and loss
adjustment expenses $ 1,129,936 $ 756,859
Unearned premiums 552,594 446,850
Reinsurance balances payable 65,778 51,856
Debt 146,447 --
Income taxes payable 314 1,571
Accrued expenses 19,047 18,010
Other liabilities 7,986 8,654
--- ----------------- -------------
Total liabilities 1,922,102 1,283,800
--- ----------------- -------------
Commitments and contingencies
(Note 14)
Mezzanine equity
Performance stock units 1,008 265
Stockholders' equity
Common stock 328 327
($0.01 par value;
400,000,000 shares
authorized, 32,783,451 and
32,662,683 shares issued
and outstanding at December
31, 2025 and December 31,
2024, respectively)
Additional paid-in capital 325,889 318,095
Accumulated other
comprehensive income (loss) 5,354 (11,154)
Retained earnings 116,695 62,909
--- ----------------- -------------
Total stockholders' equity 448,266 370,177
--- ----------------- -------------
Total mezzanine equity and
stockholders' equity 449,274 370,442
--- ----------------- -------------
Total liabilities, mezzanine
equity and stockholders'
equity $ 2,371,376 $ 1,654,242
=== ================= =============
Gross Written Premiums
The following tables present gross written premiums by underwriting division for the three and twelve months ended December 31, 2025 and 2024:
Three Months Ended December 31,
----------------------------------------------------------------
% of % of
2025 Total 2024 Total $ Change % Change
------- --------- ------- --------- ---------- ----------
($ in thousands, except percentages)
Casualty $132,905 59.3% $105,872 57.3% $ 27,033 25.5%
Professional
Liability 47,928 21.4% 46,010 24.9% 1,918 4.2%
Healthcare
Liability 34,153 15.2% 31,699 17.2% 2,454 7.7%
Baleen
Specialty 9,095 4.1% 1,188 0.6% 7,907 665.6%
------- ----- ------- ----- ------ ------
Gross
written
premiums $224,081 100.0% $184,769 100.0% $ 39,312 21.3%
======= ===== ======= ===== ====== ======
Twelve Months Ended December 31,
--------------------------------------------------------------
% of % of
2025 Total 2024 Total $ Change % Change
------- --------- ------- --------- -------- ----------
($ in thousands, except percentages)
Casualty $550,666 63.8% $431,817 62.1% $118,849 27.5%
Professional
Liability 174,419 20.2% 160,651 23.1% 13,768 8.6%
Healthcare
Liability 116,290 13.5% 101,619 14.6% 14,671 14.4%
Baleen
Specialty 21,431 2.5% 1,630 0.2% 19,801 1214.8%
------- ----- ------- ----- ------- ------
Gross
written
premiums $862,806 100.0% $695,717 100.0% $167,089 24.0%
======= ===== ======= ===== ======= ======
The following tables present gross written premiums by underwriting model(1) for the three and twelve months ended December 31, 2025 and 2024:
Three Months Ended December 31,
----------------------------------------------------------------
% of % of
2025 Total 2024 Total $ Change % Change
------- --------- ------- --------- ---------- ----------
($ in thousands, except percentages)
Craft $213,313 95.2% $183,581 99.4% $ 29,732 16.2%
Digital
Baleen
Specialty 9,095 4.1% 1,188 0.6% 7,907 665.6%
Express 1,673 0.7% -- --% 1,673 NM
------- ----- ------- ----- ------ ------
Digital 10,768 4.8% 1,188 0.6% 9,580 806.4%
------- ----- ------- ----- ------ ------
Gross
written
premiums $224,081 100.0% $184,769 100.0% $ 39,312 21.3%
======= ===== ======= ===== ====== ======
Twelve Months Ended December 31,
--------------------------------------------------------------
% of % of
2025 Total 2024 Total $ Change % Change
------- --------- ------- --------- -------- ----------
($ in thousands, except percentages)
Craft $839,005 97.2% $694,087 99.8% $144,918 20.9%
Digital
Baleen
Specialty 21,431 2.5% 1,630 0.2% 19,801 1214.8%
Express 2,370 0.3% -- --% 2,370 NM
------- ----- ------- ----- ------- ------
Digital 23,801 2.8% 1,630 0.2% 22,171 1360.2%
------- ----- ------- ----- ------- ------
Gross
written
premiums $862,806 100.0% $695,717 100.0% $167,089 24.0%
======= ===== ======= ===== ======= ======
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