Old Republic International (ORI) - 2025 Q4 - Annual Results

Financial Performance - Net income for Q4 2025 was $206.3 million, a significant increase from $105.1 million in Q4 2024[2] - Net income excluding investment gains (losses) for Q4 2025 was $184.7 million, down 18.6% from $227.0 million in Q4 2024[2] - Total net income attributable to shareholders for the year was $935.4 million, compared to $852.7 million in the previous year, reflecting a growth of 9.7%[10] - Total revenues for 2025 were $9.136 billion, up from $8.231 billion in 2024, marking a 10.1% increase[8] Premiums and Fees - Consolidated net premiums and fees earned reached $2.1 billion, reflecting a 9.8% increase compared to the previous year[5] - Specialty Insurance net premiums earned increased by 8.3% for the quarter and 10.9% for the full year, driven by premium rate increases and high renewal retention ratios[13] - Title Insurance net premiums and fees earned increased by 12.4% for the quarter and 9.1% for the full year, driven by lower interest rates and strong commercial business production[19] - Commercial premiums represented 29% of net premiums earned compared to 23% in the fourth quarter of the previous year[19] Investment Income - Net investment income increased by 7.9% to $183.8 million in Q4 2025 from $170.3 million in Q4 2024[8] - Net investment income for Specialty Insurance increased by 10.2% to $157.0 million in Q4 2025, driven by higher investment yields[14] - Net investment income increased primarily due to higher investment yields earned[20] Ratios and Performance Metrics - The consolidated combined ratio for Q4 2025 was 96.0%, compared to 92.7% in Q4 2024[5] - The combined ratio for Specialty Insurance was 97.3% for Q4 2025, up from 91.8% in Q4 2024, indicating increased expenses and loss ratios[13] - The loss ratio for the current year in Specialty Insurance was 69.8%, compared to 66.5% in the previous year, reflecting higher loss trends[15] - The expense ratio for Specialty Insurance was elevated at 29.7% for Q4 2025, attributed to start-up costs of new operating companies and investments in technology[17] - The loss ratio for the current year was 3.1%, with a total combined ratio of 94.0% for the fourth quarter, reflecting effective expense management[21][19] Shareholder Returns - Total capital returned to shareholders amounted to $742 million[5] - Cash dividends declared on common stock increased by 23.2% to $2.790 per share compared to $2.265 in the previous year[8] - Total capital returned to shareholders during the quarter was $742 million, including $686 million in dividends and $56 million in share repurchases[29] Assets and Capital - Total assets increased to $29.9 billion as of December 31, 2025, up from $27.8 billion in 2024[25] - The investment portfolio allocation was approximately 85% in fixed income securities and short-term investments, and 15% in equity securities[26] Operational Insights - Operating return on beginning of year equity was 14.1%[5] - Operating expenses for Corporate & Other increased by 51.1% in the fourth quarter, reflecting higher personnel costs[23] Market and Economic Factors - Old Republic's Specialty Insurance segment results are influenced by market competition, economic conditions, and claim frequency patterns[34] - The Title Insurance segment is affected by national and regional housing demand, mortgage loan availability, and employment trends[34] - Life and accident insurance earnings are impacted by employment levels, consumer spending, and changes in mortality and health trends[34] - Risks affecting the insurance business include competition, economic factors, and external events such as natural disasters[35] Forward-Looking Statements - The company does not commit to updating forward-looking statements, which may not be relied upon[36] - Historical performance indicators may not predict future results due to various influencing factors[33]