Lancashire Holdings on track to meet full-year expectations

(Sharecast News) - Lancashire Holdings said in an update on Thursday that it had made a positive start to 2026 and remained on track to deliver full-year results in line with guidance after a relatively benign first-quarter loss environment. The FTSE 250 Bermuda-based insurer and reinsurer reported gross premiums written of $668.4m for the three months ended 31 March, down 6.1% from $712.1m a year earlier.

Excluding reinstatement premiums related to the California wildfires in the prior year, the underlying reduction was 1.2%.

The group renewal price index was 93%.

Insurance revenue rose 2.1% to $468.6m from $458.9m, reflecting premium earnings from previous underwriting years after a period of substantial growth.

Gross premiums earned as a proportion of gross premiums written were 79.9%, broadly consistent with the same period last year.

Chief executive Alex Maloney said Lancashire had made "a positive start to 2026", while maintaining its focus on active cycle management.

"With the strong first quarter, we are on track to deliver results in line with our guidance for the year," he said.

Reinsurance gross premiums written fell 14.8% to $411.0m from $482.3m, with a renewal price index of 92%, after the group enacted a planned reduction in inwards property retrocession.

Insurance gross premiums written rose 12.0% to $257.4m from $229.8m, with a renewal price index of 94%, driven mainly by energy and marine lines and the continued build-out of Lancashire's US franchise.

"As part of our proactive approach to managing the cycle, we enacted a planned reduction in inwards property retrocession in our reinsurance segment," Maloney said.

"This was offset by a 12% increase in gross premiums written across our insurance lines to $257.4m, where we saw attractive opportunities for growth."

Lancashire said the first-quarter loss environment was relatively benign and that exposure to the ongoing Middle East conflict was limited and within risk appetite.

The group reported a regulatory enhanced capital requirement ratio of 254% at 31 December.

The investment portfolio returned 0.3% in the quarter, including unrealised gains and losses.

Lancashire said investment income was partly offset by price declines caused by rising Treasury yields and modest widening of investment-grade credit spreads, while private investment funds contributed positively.

Managed investments stood at $3.22bn at 31 March, with a duration of 2.2 years, A+ credit quality, and both book and market yield of 4.6%.

Maloney said the group's expanded product portfolio and geographic reach left it well placed to generate attractive risk-adjusted underwriting returns through the cycle.

"Clearly, the period has seen very significant geopolitical volatility leading to wider economic uncertainty," he said.

"Lancashire's exposure to the current events in the Middle East is limited and well within our risk appetite."

The company said that, following its acquisition of 100% of the underwriting capacity for Syndicate 2010 from the 2026 year of account, it planned to combine Lancashire Syndicates 3010 and 2010 under Syndicate 3010 for the 2027 and subsequent years of account, subject to Lloyd's approval.

Lancashire also noted senior management transitions in its Lloyd's and Bermuda platforms, with Rachel Sabbarton and Jennifer Wilson succeeding John Spence and Hayley Johnston as chief executives respectively.

The group maintained its expectation of a stable top line and a high-teens return on equity for 2026.

At 0919 BST, shares in Lancashire Holdings were down 1.31% at 565.5p.

Reporting by Josh White for Sharecast.com.

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