Arch Capital’s Q3’25 underwriting income rises to $871m amid improved reinsurance result

Core Insights - Arch Capital Group Ltd. reported a 62% year-on-year increase in underwriting income to $871 million for Q3 2025, driven by strong performance in its reinsurance business [1] Financial Performance - The combined ratio improved by 6.8 percentage points to 79.8% for Q3 2025, with the loss ratio decreasing by 9.1 percentage points to 51.4% and the expense ratio increasing by 2.3 percentage points to 28.4% [2] - Net income available to common shareholders reached $1.34 billion in Q3 2025, up from $978 million in the prior year [4] - Underwriting income in the reinsurance segment surged by 223.5% year-on-year to $482 million, with the combined ratio improving by 16.2 percentage points to 76.1% [4] Premiums and Reserves - Gross premiums written (GPW) were stable at $5.4 billion, while net premiums written (NPW) fell by 2.1% to $3.96 billion, and net premiums earned increased by 7.9% to $4.3 billion [3] - GPW in the reinsurance segment decreased by 9% year-on-year to $2.5 billion, while NPW declined by 11% to $1.7 billion [6] - In the insurance segment, underwriting income rose by 7.5% year-on-year to $129 million, with GPW increasing by 10% to $2.6 billion [7] Catastrophic Losses and Reserves - Pre-tax current accident year catastrophic losses totaled $72 million for the quarter [2] - Favorable development in prior year loss reserves amounted to $103 million [3] - The loss ratio for Q3 2025 reflected 1.3 points of current year catastrophic activity, a significant decrease from 21.3 points in the prior year [5] Investment Income - Arch reported pre-tax net investment income of $408 million, attributed to growth in average invested assets [10] Management Commentary - The CEO expressed satisfaction with the financial performance, highlighting record-level results of operating income and optimism for future performance in the current market [11]