Bowhead Specialty Holdings Inc.

Hello, and welcome to Bowhead Specialty's Q3 2025 earnings call. After the prepared remarks, we will hold a question and answer session. For those in the Q&A room, please use the raise hand function at the bottom of your Zoom screen to join the question queue. You can do this at any time and your questions will be addressed during the Q&A session. Also, as a reminder, this conference is being recorded. If you have any objections, please disconnect at this time. With that, I would like to turn the call over to Shirley Yap, head of investor relations. Shirley, you may begin.

Thanks, operator. Good morning and welcome to Bowhead's third quarter 2025 earnings conference call. I'm Shirley Yap, Bowhead's Chief Accounting Officer and Head of Investor Relations. Joining me today are Stephen Sills, our Chief Executive Officer, Brad Mulcahy, our Chief Financial Officer, and Steve Feltner, our Chief Operating Officer. Before we jump into our performance and financial highlights, I wanted to introduce the new format we plan to use for today's call and going forward. Each quarter, we plan to invite an additional member of our management team to share insights from their area of expertise. Today, we are joined by Steve Feltner, our Chief Operating Officer, who will discuss our technology initiatives and other efficiencies that are enabling us to scale profitably while growing rapidly across market cycles. Turning to our performance, earlier this morning, we released our financial results for the third quarter of 2025. You can find our earnings release in the investor relations section of our website. Our form 10Q will also be made available on our website later this evening. I'd like to remind everyone that this call contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Investors should not place undue reliance on any forward-looking statement. These statements are made only as of the date of this call and are based on management's current expectations and beliefs. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated by these statements. You should review the risks and uncertainties fully described in our SEC filings. We expressly disclaim any duty to update any forward-looking statement except as required by law. Additionally, we will be referencing certain non-GAAP financial measures on this call. Reconciliations of these non-GAAP financial measures to their respective most directly comparable GAAP measure can be found in the earnings release we issued this morning and in the investor relations section of our website. With that, it's my pleasure to turn the call over to Stephen Sills.

Thank you, Shirley. Good morning, everyone. And thank you for taking the time to join our call today. I'm pleased to share that Bowhead once again delivered consistent, strong top and bottom line growth in Q3. Gross written premiums increased 17.5% year over year, while adjusted net income increased 25.5%, and diluted adjusted earnings per share increased 23.7%, to 47 cents a share. These results are a testament to our disciplined approach to underwriting, the continued expansion of our craft and flow underwriting operations, and our commitment to operational excellence. Starting with GWP, Bo had generated approximately $232 million in gross written premiums during the third quarter. Our casualty division grew 20% to 145 million for the quarter. We believe the most favorable segment in the marketplace today is excess casualty business. Our excess casualty book was the primary driver of our 20% growth. Given the recent industry adverse reserve development reported in casualty lines, I wanted to take a moment to revisit the two key areas we believe set us apart from the markets experiencing these challenges. First, our timing. We launched our casualty division at the end of 2020, giving us the opportunity to capitalize on the hardening ENS casualty market. While legacy carriers were grappling with pre-2020 losses, we entered a market being able to properly price business, a market that could be characterized by compounded rate increases stronger terms and conditions, and lower average limit deployment. Second, our discipline. We are highly selective in the casualty risks we write and equally intentional about the risks we choose to avoid. In our business, picking winners is not as important as avoiding losers. Our casualty division offers specialized primary and excess general liability coverage through a wholesale-only distribution channel, focusing on the construction, distribution, manufacturing, real estate, and public entity segments. Our casualty division rarely writes Fortune 1000 business, which we believe has historically been underpriced. We also do not write primary commercial auto business, as well as many of the other classes that have been the source of adverse reserve development for others over the past several years. Although we have auto exposure on our excess follow form policies, we believe we appropriately price for this risk. With the timing of our casualty division launch, the specialized products we offer, the risks we deliberately avoid, and our disciplined underwriting approach, we believe we have built a casualty underwriting operation positioned for profitable and sustainable growth. Turning to our healthcare liability division, our premiums increased 11% to 35 million, driven by the growth in our healthcare management liability, hospitals, and senior care portfolios. As we review both new and renewal submissions, we remain disciplined When an account's conditions no longer meet our underwriting standards, we're prepared to let other carriers write those accounts. In our professional liability division, premiums increased 2% to $46 million for the quarter, driven by the growth in commercial public D&O and cyber liability. This growth was partially offset by the decline in premiums written in our financial institutions portfolio, a sector we highlighted last quarter that suffers from an overabundance of competitors. The growth in our cyber liability portfolio was made possible by utilizing the technology driving Bailene's growth. Speaking of Bailene, we're pleased to report that we generated $6.2 million in premium during the quarter, which was 83% growth from Q2 and exceeded total premiums written by Bailene in the first half of 2025. We're excited about the momentum we've achieved in the third quarter and look forward to reporting Bailin's continued strong growth in Q4. Turning to our views on the broader E&S market, I wanted to address the September E&S stamping data that came out of California, Florida, and Texas. Together, these top E&S states reported a 1% decline in overall E&S premiums during the third quarter. However, the decline was primarily driven by the decrease in ENS property premiums, which is, I've mentioned in the past, is a segment that Bowhead does not participate in. ENS casualty premiums, which are more relevant to Bowhead, continue to grow during the quarter, and we expect this trend to persist as complex risks continue to move into the ENS market. During the quarter, in casualty, we saw markets maintaining discipline in their deployment of limits and pricing. With carriers reporting recent adverse reserve development from prior accident years and increasing current accident year loss picks in casualty, we do not expect to see limits going back up or an across-the-board price drop anytime soon. Further, the Everest AIG renewal rights deal should create an opportunity for the industry to re-underwrite a large segment of the business. Turning to the E&S construction project sector, we've seen a deceleration of new, large residential projects due to the uncertainty around interest rates, building materials, and labor costs. We're also seeing delays in infrastructure projects that receive public financing due to the government shutdown. The healthcare liability market continues to be a competitive sector, but we've seen encouraging developments in a couple of areas. First, a reputation within the healthcare industry is generating increased opportunities for us. And second, we're starting to see exclusions for sexual abuse and molestation gain traction. In professional liability, similar to last quarter, with the exception of commercial public D&O, we're continuing to see challenging market conditions, particularly in the financial institutions and large cyber liability account space. As we mentioned earlier in the call, we're utilizing the technology driving Balien's growth to cost effectively underwrite small and middle market cyber liability accounts, a space we believe to be very favorable. Finally, last quarter, I made a statement that I was confident that we can get our expense ratio below 30%. I'm proud to say that we achieved an expense ratio of 29.5% during the quarter. We're using technology to do more than streamline processes. It's helping us enhance decision-making, improve risk selection, and support our distribution partners more effectively. In other words, we're managing expenses while also accelerating top-line growth. Leading the charge in this area is Steve Feltner, our chief operating officer. I'd like to now turn the call over to Steve to discuss these initiatives. Steve?