Financial Data and Key Metrics Changes - The company reported core income of $2.5 billion for Q4 2025, or $11.13 per diluted share, with a core return on equity of 29.6% [6][21] - Full-year core income increased by 26% to $6.3 billion, with a core return on equity of 19.4% [21][24] - Underwriting income for Q4 was $2.2 billion, a 21% increase compared to the prior year quarter, driven by strong net earned premiums and improved margins [7][24] - The underlying combined ratio improved to 82.2%, marking the fifth consecutive quarter below 85 [24] Business Line Data and Key Metrics Changes - Business Insurance net written premiums reached $5.5 billion, with a renewal premium change of 6.1% [9][38] - Bond and Specialty Insurance net written premiums grew to $1.1 billion, with retention at 87% [10][48] - Personal Insurance net written premiums were $4.2 billion, reflecting strong renewal premium change in homeowners and higher new business in auto [11][54] Market Data and Key Metrics Changes - The company grew net written premiums to $10.9 billion in Q4 2025, with disciplined execution across all segments [9] - The investment portfolio increased by approximately $7.5 billion to $106 billion, with after-tax net investment income of $867 million, up 10% from the prior year [8][28] Company Strategy and Development Direction - The company is transitioning to Innovation 2.0, leveraging AI and advanced technology to enhance underwriting, claims processing, and overall operational efficiency [15][18] - The focus remains on maintaining strong underwriting income and profitability while investing in technology to drive future growth [12][20] - The company aims to balance its portfolio between auto and property, with a strategic emphasis on risk selection and pricing [60][62] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to generate substantial shareholder value and maintain strong performance in 2026 and beyond [22][21] - The company is well-positioned to handle future challenges, including regulatory scrutiny and market dynamics, while continuing to invest in technology and innovation [71][73] Other Important Information - The company returned $1.9 billion of capital to shareholders in Q4, including $1.7 billion in share repurchases [8][34] - Adjusted book value per share increased by 14% year-over-year to $158.01 [33] Q&A Session Summary Question: Insights on technology investments and expense ratio - Management acknowledged the importance of optimizing operating leverage and indicated that efficiency gains from technology investments may not immediately reflect in the expense ratio [68][70] Question: Regulatory focus on profitability in Personal Insurance - Management highlighted that while profitability is a concern, the company has historically managed to maintain a balanced approach to pricing and risk [72][74] Question: Deceleration in renewal premium change in Business Insurance - Management noted that the deceleration is due to a combination of rate and exposure factors, with both playing a role in the overall change [76][78] Question: Overall rate adequacy in national property - Management indicated that while pricing dynamics are challenging, they believe the profitability of the business justifies current rates [80][81] Question: Capital return strategy and future buybacks - Management confirmed that while they expect higher buybacks in Q1, future buybacks will depend on various factors including catastrophe losses and overall profitability [82][85] Question: Catastrophe losses expectations for 2026 - Management clarified that the attachment point of their catastrophe treaty provides a buffer, and they do not expect significant drag on premium growth from ceded premiums [87][89] Question: Technology initiatives and headcount growth - Management refrained from providing specific headcount projections but noted that premium per employee is expected to continue increasing due to productivity initiatives [92] Question: Pricing trends in casualty commercial lines - Management reported that general liability pricing is in the mid-single digits, while umbrella lines are experiencing double-digit renewal premium changes [94]

Financial Data and Key Metrics Changes - The company reported core income of $2.5 billion for Q4 2025, or $11.13 per diluted share, with a core return on equity of 29.6% [4] - Full-year core income increased by 26% to $6.3 billion, with a core return on equity of 19.4% [13] - Underwriting income for Q4 was $2.2 billion pre-tax, a 21% increase compared to the prior year quarter, with an underlying combined ratio improving to 82.2% [4][15] Business Line Data and Key Metrics Changes - Business Insurance net written premiums reached $5.5 billion, with a renewal premium change of 6.1% [5][25] - Bond and Specialty Insurance grew net written premiums to $1.1 billion, with retention at 87% [6][32] - Personal Insurance net written premiums were $4.2 billion, reflecting strong renewal premium change in homeowners and higher new business in auto [7][36] Market Data and Key Metrics Changes - The company grew net written premiums to $10.9 billion in Q4 2025, driven by disciplined execution across all segments [5] - The underlying combined ratio for Business Insurance was 87%, with a strong retention rate of 85% [24][27] - The overall market environment remains competitive, with pricing dynamics reflecting profitability in the property line [51] Company Strategy and Development Direction - The company is transitioning to Innovation 2.0, leveraging AI and advanced technology to enhance underwriting and operational efficiency [9][10] - Strategic investments in technology exceeded $1.5 billion, focusing on automation and data analytics to improve risk assessment and customer service [13][34] - The company aims to maintain a balance between auto and property lines while optimizing risk return profiles [41][42] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the durability of strong underlying business performance, expecting continued substantial shareholder value generation [14] - The company anticipates a stable expense ratio of around 28.5% for 2026, reflecting ongoing efficiency gains [15][22] - Management acknowledged regulatory scrutiny on profitability but emphasized the importance of fair pricing and risk management over time [49] Other Important Information - The company returned $1.9 billion of capital to shareholders in Q4, including $1.7 billion in share repurchases [5][22] - The investment portfolio grew to $106 billion, with after-tax net investment income of $867 million for the quarter, up 10% [5][17] - Catastrophe losses for Q4 were $95 million pre-tax, with favorable prior year reserve development contributing positively [16][17] Q&A Session Summary Question: Inquiry about technology investments and expense ratio - Management indicated that the expense ratio is managed and that efficiency gains from technology investments provide flexibility in operations [45][46] Question: Concerns about regulatory pushback on profitability - Management acknowledged the importance of affordability and clarified that recent profitability levels are not indicative of over-earning [49] Question: Clarification on renewal premium change in Business Insurance - Management noted that the deceleration in renewal premium change is due to both rate and exposure factors [50][51] Question: Discussion on capital return strategy - Management confirmed no change in capital management strategy and emphasized responsible capital distribution based on profitability and growth environment [54] Question: Expectations for catastrophe losses in 2026 - Management explained that the attachment point of the treaty provides tail protection and that the year-over-year impact of ceded premium is not expected to be significant [57]

Financial Data and Key Metrics Changes - The company reported core income of $2.5 billion for Q4 2025, or $11.13 per diluted share, with a core return on equity of 29.6% [4] - Full-year core income increased by 26% to $6.3 billion, with a core return on equity of 19.4% [15] - Underwriting income for Q4 was $2.2 billion pre-tax, up 21% year-over-year, with an underlying combined ratio improving to 82.2% [4][17] Business Line Data and Key Metrics Changes - Business Insurance net written premiums reached $5.5 billion, with a renewal premium change of 6.1% [5][26] - Bond and Specialty Insurance grew net written premiums to $1.1 billion, with retention at 87% [7] - Personal Insurance reported net written premiums of $4.2 billion, reflecting strong renewal premium change in homeowners and higher new business in auto [8][37] Market Data and Key Metrics Changes - The company grew net written premiums to $10.9 billion in Q4 2025, driven by disciplined execution across all segments [5] - The investment portfolio grew by approximately $7.5 billion to $106 billion, with after-tax net investment income of $867 million, up 10% year-over-year [19][20] Company Strategy and Development Direction - The company is transitioning to Innovation 2.0, leveraging AI and technology to enhance underwriting, claims processing, and overall operational efficiency [10][11] - The focus remains on maintaining strong underwriting income and improving operational leverage through strategic investments in technology [14][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to generate substantial shareholder value, citing strong underlying business performance as a foundation for future results [16] - The outlook for fixed income net investment income for 2026 is projected at approximately $3.3 billion after-tax, indicating significant growth compared to previous years [20] Other Important Information - The company returned $1.9 billion of capital to shareholders in Q4, including $1.7 billion in share repurchases [5][23] - Adjusted book value per share increased by 14% year-over-year to $158.01 [22] Q&A Session Summary Question: Insights on technology investments and expense ratio - Management indicated that while the expense ratio is expected to remain flat at 28.5% for 2026, the company is focused on optimizing operating leverage and managing efficiencies [44][46] Question: Regulatory considerations on profitability - Management acknowledged the importance of addressing affordability issues and emphasized that the profitability of the Personal Insurance business should be viewed over a longer period [48][49] Question: Changes in renewal premium change in Business Insurance - Management noted that the deceleration in renewal premium change is attributed to both rate and exposure factors [50][51] Question: Capital return strategy and future buybacks - Management confirmed no change in capital management strategy and indicated that buybacks will depend on various factors, including catastrophe losses and overall profitability [52][54] Question: Catastrophe losses and their impact on premium growth - Management clarified that the expected impact of ceded premium on premium growth in 2026 is not anticipated to be significant [56]

Financial Data and Key Metrics Changes - The company reported core income of $1.9 billion or $8.14 per diluted share, with a core return on equity of 22.6% for the quarter, bringing the trailing twelve months core return on equity to 18.7% [6][22] - Underwriting income reached $1.4 billion pretax, more than doubling compared to the prior year quarter, benefiting from lower catastrophe losses and higher underlying underwriting income [7][22] - The underlying combined ratio improved by 1.7 points to an exceptional 83.9%, marking its fourth consecutive quarter below 85% [22] - After-tax net investment income was $850 million for the quarter, up 15% year-over-year, driven by strong returns from the fixed income portfolio [7][24] Business Line Data and Key Metrics Changes - In Business Insurance, net written premiums grew by 3% to $5.7 billion, with domestic business growing by 4% [9][30] - Bond and Specialty Insurance saw net written premiums increase to $1.1 billion, with strong retention of 87% [11][39] - Personal Insurance reported written premiums of $4.7 billion, with strong renewal premium change in the homeowners business [12][43] Market Data and Key Metrics Changes - The company experienced a higher than usual level of excess capital and liquidity, anticipating increased share repurchases in the upcoming quarters [8][28] - The overall market environment remains uncertain due to economic and geopolitical factors, but the company feels well-positioned to navigate these challenges [12][15] Company Strategy and Development Direction - The company is focused on maintaining underwriting discipline and strategic investments in technology, with over $13 billion invested since 2016 [14][15] - The emphasis on data and analytics is expected to enhance underwriting capabilities and improve operational efficiency [15][30] - The company aims to leverage its scale and data to drive competitive advantages in a market increasingly influenced by technology and AI [15][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strong financial position and ability to manage through large loss events, citing a fortress balance sheet and exceptional cash flow [15][16] - The company is optimistic about future growth opportunities, despite acknowledging uncertainties in the economic and loss environment [12][13] - Management highlighted the importance of maintaining a balanced and diversified portfolio to mitigate risks associated with market volatility [16][19] Other Important Information - The company returned nearly $900 million of capital to shareholders during the quarter, including $628 million in share repurchases [8][26] - Adjusted book value per share increased by 15% compared to a year ago, reaching $150.55 at quarter end [26] Q&A Session Summary Question: Concerns about top line growth and headwinds - Management acknowledged the challenges affecting top line growth but emphasized confidence in their value proposition and strategic investments to drive future growth [55][56] Question: Technology initiatives and AI impact - The company is investing over $1 billion annually in technology, particularly in AI, expecting significant benefits in efficiency and productivity [59][60] Question: Property pricing dynamics - Management noted that while property pricing has softened, they continue to see positive price increases in select and middle markets [66] Question: Loss cost trends and reserve releases - Management indicated that loss trends have remained stable, with no significant surprises in loss activity during the quarter [71][72] Question: Impact of tariffs on margins - The company has seen a small impact from tariffs but does not expect significant effects on margins at this time [105][109]

Financial Data and Key Metrics Changes - The company reported core income of $1,500,000,000 or $6.51 per diluted share, with a core return on equity of 18.8% for the quarter, and 17.1% for the trailing twelve months [5][14] - Underwriting income improved with a combined ratio of 90.3%, a nearly 10-point improvement, driven by lower catastrophe losses and favorable prior year reserve development [6][14] - Adjusted book value per share increased by over 14% compared to the previous year, reaching $144.57 [20] Business Line Data and Key Metrics Changes - Business Insurance segment income rose to $813,000,000, up nearly 25% from the prior year, with net written premiums increasing by 5% to $5,800,000,000 [25][30] - Bond and Specialty Insurance generated segment income of $244,000,000 with a combined ratio of 80.3% [31] - Personal Insurance delivered segment income of $534,000,000, with an underlying combined ratio of 79.3%, reflecting significant improvements in underwriting [35][36] Market Data and Key Metrics Changes - Net written premiums grew to $11,500,000,000 in the quarter, with growth across all three segments [9] - Renewal premium change in Business Insurance was strong at 7.7%, with retention rates at 85% [9][27] - In Personal Insurance, renewal premium change was 19.3%, indicating strong pricing actions [39] Company Strategy and Development Direction - The company is committed to disciplined capital allocation and value creation, as evidenced by the sale of its Canadian business for $2,400,000,000 [11][12] - The focus remains on optimizing capital deployment to generate attractive returns and profitable growth [12][14] - The company plans to relax property restrictions by the end of 2025, aiming to balance its portfolio between auto and property [40][106] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the outlook for continued premium growth and attractive underwriting margins, supported by a strong balance sheet [14][20] - The company noted that the overall market conditions remain orderly, with a positive trajectory for investment income [14][20] - Management acknowledged the challenges posed by tort inflation but indicated that pricing strategies are in place to address these issues [58] Other Important Information - The company returned over $800,000,000 of capital to shareholders during the quarter, including $557,000,000 in share repurchases [8][21] - Operating cash flows for the quarter were strong at $2,300,000,000, marking the twenty-first consecutive quarter with cash flows exceeding $1,000,000,000 [21] Q&A Session Summary Question: Insights on Business Insurance pricing and competition - Management noted that while there are some pressures in the national property market, overall pricing remains strong in other lines, with retention indicating market stability [44][48] Question: Future expectations for Personal Lines and premium production - Management indicated that relaxing property restrictions could positively impact both property and auto opportunities, aiming for a balanced portfolio [49][106] Question: Concerns about property market durability - Management expressed confidence in the overall positive landscape and indicated that property outside of national accounts has historically performed differently [52][53] Question: Impact of tariffs on pricing and margins - Management stated that there has been no significant impact from tariffs on their businesses, but they are monitoring the situation [73] Question: Cyber insurance market dynamics - Management highlighted that the cyber insurance market remains competitive, with pricing not fully reflecting the loss environment [108]