Kinsale Capital Group, Inc.

Good morning and welcome to Kinsale Capital Group's third quarter 2025 earnings conference call. All participants are in a listen-only mode. After the speaker's remarks, we will conduct a question and answer session. To ask a question at this time, you will need to press star followed by the number one on your telephone keypad. As a reminder, this conference call is being recorded. Before we get started, let me remind everyone that through the course of the teleconference, and sales management may make comments that reflect their intentions, beliefs, and expectations for the future. As always, these forward-looking statements are subject to certain risk factors, which could cause actual results to differ materially. These risk factors are listed in the company's various SEC filings, including the 2024 Annual Report on Form 10-K, which should be reviewed carefully. The company has furnished a Form 8-K with the Securities and Exchange Commission, that contains the press release announcing its third quarter results. Kinsale's management may also reference certain non-GAAP financial measures in the call today. A reconciliation of GAAP to these measures can be found in the press release, which is available at the company's website at www.kinsalecapitalgroup.com. I will now turn the conference over to Kinsale's chairman and CEO, Mr. Michael Kehoe. Please go ahead, sir.

Thank you, operator, and good morning, everyone. Brian Petrucelli, our CFO, Brian Haney, our President and COO, and Stuart Winston, our EVP and CUO, Chief Underwriting Officer, are joining me on the call this morning. We announced some management changes last night, the most significant of which is Brian Haney's recent election to the Board of Directors and the announcement of his retirement and new role as Senior Advisor beginning next year. We congratulate him on his election and are encouraged that he will continue to have a prominent role in the governance and direction of Kinsale. Brian and I have worked together for almost 30 years at three different ENS companies. He was one of the original founders of Kinsale and has made tremendous contributions to our success over the almost 17 years we have been in business. It's been a great run. And needless to say, we are fortunate that he will continue contributing to Kinsale as a director and as a senior advisor with a focus on investor communications. I'd also like to congratulate Stuart Winston on his promotion to executive vice president and chief underwriting officer. Stuart and his team have delivered some of the best underwriting results in the industry. So this recognition is well-earned. And under his leadership, we have great expectations for continued profit and growth in the future. In the third quarter of 2025, can sales operating earnings per share increase by 24%? And gross rate and premium grew by 8.4% over the third quarter of 2024. For the quarter, the company posted a combined ratio of 74.9% and a nine-month operating return on equity of 25.4%. Our book value per share has increased by 25.8% since the year end 2024, and our float has increased by 20%. E&S market conditions were steady in the third quarter, generally competitive with our growth rate varying from one market segment to another with our overall growth rate at 8.4%. Our commercial property division premium dropped by 8% in the third quarter compared to a 17% drop in the second quarter. The overall third quarter growth rate excluding our commercial property division was 12.3%. And Brian Haney is going to provide some commentary on the market here in a moment. Can sales disciplined underwriting and low cost business model is a consistent winner in an industry where the customers are intensely focused on cost. As the ENS market has become more competitive over the last two years, Kinsale's efficiency has become a more significant competitive advantage by allowing us to deliver competitive policy terms to our customers without compromising our margins. In a moment in the P&C cycle characterized by loose underwriting standards, sales control of its underwriting process and superior data and analytics helps deliver consistent and attractive results. And with that, I'll turn the call over to Brian Petrucelli.

Thanks, Mike. As Mike just noted, we continue to generate great results. with net income and net operating earnings both increasing by 24% quarter over quarter. The 74.9% combined ratio for the quarter included 3.7 points from net favorable prior year loss reserve development compared to 2.8 points last year, with less than a point in CAT losses this year compared to 3.8 points in the third quarter of last year. We continue to take a cautious approach to releasing reserves. Gross written premium grew by 8.4% for the quarter, while net earned premium grew by 17.8%, which was higher than the gross written premium due to an increase in retention levels upon renewal of our reinsurance program on June 1st. We produced a 21% expense ratio in the third quarter compared to 19.6% last year. Higher expense ratio is attributable to lower seating commissions generated on the company's and commercial property quota share reinsurance agreements as a result of the higher reinsurance retention levels that I just mentioned. On the investment side, net investment income increased by 25.1% in the third quarter over last year as a result of continued growth in the investment portfolio generated from strong operating cash flows. Kin sales float, mostly unpaid losses and unearned premium, grew to $3 billion at September 30, up from $2.5 billion at the year end of 2024. The annual gross return was 4.3% for the first nine months of this year and consistent with last year. New money yields are averaging slightly below 5% with an average duration of 3.6 years on the company's fixed maturity investment portfolio. And lastly, diluted operating earnings per share continues to improve and was $5.21 per share for the quarter compared to $4.20 per share for the third quarter of 2024. And with that, I'll pass it over to Brian Haney.

Thanks, Brian. First, let me say it's been an absolute honor and privilege to have worked at Kinsale for the last 17 years. There's no better ENS company in the business, and there's no better group of people to work with. Kinsale has come a long way from those first days in 2009, when we were just starting out with Brian Petrucelli, Mike, myself, as well as Bill Kenney, Ann Marie Morrison, and Ed Desch, who I see is on the phone call today. I'm grateful for the opportunities I've been given by Mike and the board over the years. I'm proud to have played whatever part I could in the success of Kinsale. It's a tremendous honor to have the opportunity to serve on this board with so many talented directors whom I've worked with over the years, and I'm really pleased that I will continue to be associated with this great company. And I'm very confident in our future. We have built an amazingly deep bench We have great young executives like Stuart and many others like him. The investors should rest assured that this company is in great hands and will continue to be going forward. With that said, on to business. The E&S market remains competitive, as Mike said, though the intensity varies by division. The shared and layered commercial property continues to be very competitive, but it appears we hit an inflection point sometime early in the third quarter, perhaps late in the second, where the rate of decline is abating. When you look at all the property business in total, including the small property, agribusiness property, and inland marine, the book actually grew in the third quarter. In other areas, we're seeing the most growth in commercial auto, entertainment, energy, and allied health. Although the market is competitive, our model of low expenses and absolute control over the underwriting and claims handling works well in any market. I would argue it works better in a competitive market because it makes our expense ratio more telling. Also, the fastest-growing participants in the market today are largely fronting companies whose risk-bearing partners must contend with expense ratios, often double R's or higher, and that math isn't going to work out for them. Submission growth was 6% for the quarter, which is down from 9% in the first quarter. That decline is driven by our commercial property division. Our pricing trends are similar to the AMWINS index, which reported an overall 0.4% decrease. Commercial property rates are still declining, but we feel we've reached that inflection point, as I mentioned, where the rate declines are stabilizing, and I expect we will see rates in the commercial property market moderate going forward. Overall, we remain optimistic. Our results are good. Our growth prospects are good, and as the low-cost provider in our space, we have a durable competitive advantage that should allow us to continue to gradually take market share from our higher expense competitors while continuing to deliver strong returns and build wealth for our investors. And with that, I will turn it back over to Mike.

Thanks, Brian. Operator, we're now ready for any calls in the queue or calls, questions.

As a reminder, to ask a question, please press star followed by the number one on your telephone keypad. Our first question will come from Bob Huang from Morgan Stanley. Please go ahead. Your line is open.

uh good morning uh so brian congratulations on on the new new role and the retirement but just maybe if we go into the uh your your business outside of commercial property uh can you maybe comment on where you think the future opportunities would be um especially given it seems like there's a little bit of a growth deceleration for the quarter just kind of curious outside of commercial property, what are the areas that you think that are very attractive for you, and what are the areas you think you want to pull back a little bit?

Well, I think we've got opportunity across the whole book. I would say some of our newer areas that we've developed recently would be the transportation segment and the agribusiness segment, but I think there's still a great opportunity in casualty. And then some of the other property-related lines, I think there's still a great opportunity. High-value homeowners and our personal lines is an area we're putting a lot of emphasis into. We think that's a great opportunity. So I think it's really widespread. There's a lot of different places we can grow.

Yeah, for the quarter, all of our property lines, except for the large commercial property division, all the other property-focused lines grew at a double-digit cliff. So I would reiterate what Brian said. We're pretty confident. Okay.

Got it. No, that's very helpful. Thank you. My second question is... With regards to technology, obviously that's one of your core competencies here, but just curious if you can give us a little bit of color in terms of new tech innovation and implementation into the business, and then just curious as to how you're incorporating emerging technology into your business, and where are the areas you feel that would be advantageous for Kingsale going forward?

Well, Bob, this is Mike. You know, when we started the business 17 years ago, we talked about making tech a core competency of our company alongside of the underwriting and the claim handling. And I think we've done that. We built our own enterprise system over the years, took a long time. And about two or so years ago, we started what we call target state architecture, which is a complete rewrite of that entire enterprise system. It's an enormous undertaking. but it kind of puts us in a position to really speed up the implementation of new technologies and whatnot. So that target state is an enormous project. We're always enhancing and expanding our product line. That involves our technology department. We've been making ample use of the new AI tools that have come out, both in our IT department as well as underwriting and claims, trying to drive automation in our business process. So, I mean, there's a million ways, but I think it goes a long way to explaining why we're able to operate at such a significant cost advantage over our competitors. And I think a lot of it is, hey, we've got a really well-designed enterprise system specifically for our company. We don't have legacy software going back 20, 30, 40 years. We don't have thousands of legacy applications. I think we're just in a really attractive spot.

Okay. Got it. Really appreciate it. Thank you.

Our next question comes from Michael Phillips from Oppenheimer. Please go ahead. Your line is open.

Thank you. Good morning. I want to touch on one line of business, the construction liability line. Was there any change in assumptions in that segment that affected your current year loss spec?

I don't know that there were any changes there specifically. We do a quarterly review of our loss reserves by stat line of business. And that goes, you know, we're in our, I think, 16th accident year. You know, we've got about a dozen lines of business, so there's a high degree of complexity in that analysis. You know, could very well have picked up some adjustments in the construction, but I just don't know off the top of my head. I think in general, you know, we feel great about the quarter. I think our losses continue to come in below our expectations. There's a little bit of variability in the loss ratios

roll everything together and i think that's normal but um again we're we feel uh really positive about the lost performance okay thank you um and then second one would be on your excess casualty segment could you talk about that segment what you're seeing is there any growth opportunities there and what you're seeing maybe for lost trends in that segment thank you

Yeah, Michael, this is Stuart. We're still seeing good opportunities in excess casualty. Rates are holding strong. We're seeing some pressure in the market at the high access attachment points where those are being more attractive for various competitors. But that's typically not where we play. We're typically in the lead or the first 10 million most of our placements. So there's still a good opportunity for growth and rates are holding strong where we participate in the market.

Okay. Thank you, Stuart. Appreciate it.

Our next question comes from Mike Sremski from BMO Capital Markets. Please go ahead. Your line is open.

Thanks. Good morning. I'm just going back to casualty, but a broader brush on the on all on all casualty X property. I was kind of your core your core business are you know, you saw a bit of a sequential decel in premium growth there. Any color you can offer under the state of the marketplace Casually specific, you know, pricing, you know, you talked about MGAs in the past as well. Is that still just as competitive? Thanks.

I'll start, Mike, and then I'll maybe get Stuart to make a few comments. But I would just remind you that we write casualty business across many specific underwriting divisions, each one focused on a different industry segment or coverage. And they never move in tandem. Right, there's always variability as you go from one area to the next, but in general I think things are still going well.

Yeah, the long tail casualty lines, you know, you're seeing moderate competition, but there's a lot of rational actors out there with the adverse development over the last couple of years in the market. But there's segments like areas like excess casualty, social services and allied health group that are still still really strong and the market will experience some dislocation. The same with premises liabilities, so general casualty, entertainment, groups like that. It's still a very strong market there for growth.

Okay. I mean, I guess that's very helpful. So, you know, if we look at the cashy trend, though, it's still kind of, you know, it's decelerating from a growth perspective. I'm not saying, you know, growth, we want profitability, not growth. But is your view, you shared your view that shared in layer, things are becoming less negative, I guess, from a pricing standpoint, I'm assuming. Do you think the casualty is also getting less competitive, or increasing competition will remain impacting the top line?

Mike, it's Mike again. I would say we're in a very competitive period in the insurance cycle. Again, it varies a little bit, division by division. But I think the you know that the. You've seen over the last two years the concealed growth rate has kind of come in from, you know, kind of an extraordinary 40% rate to you know this quarter high single digits. I think we've reiterated many times that you know over the cycle we think 10 to 20% is a good conservative estimate of our of our growth potential. I think that's probably the best commentary we can offer. I mean, it's a diverse product line. It's a very competitive market. We've got a very competitive business strategy with the control we exercise over our underwriting. It drives a more accurate process. And then when you look at the cost advantage we have over competitors, it's extraordinary. So I think we're in a great spot. We were encouraged that the growth rate going from the second to the third quarter ticked up from five to 8.4%. You know, Brian Haney highlighted the fact that if you took the commercial property out, you know, that put us in the low double digits. You know, admittedly, that was down from, you know, went from 14 to 12. But to me, that's just kind of normal variability quarter by quarter. I wouldn't read too much into that two-point decline.

Okay, that's helpful. And just take one last one in. I think part of your special sauce, I believe, uniquely allows Kinzale to, I guess, maybe not need to pay profit share commissions to some of your broker partners. Is it ever a consideration, especially in more competitive times like today, to rethink that strategy or that that's not on the table?

The profit commissions are typically associated with delegated underwriting. Right, so many companies, especially in the SME area, aren't able to handle the volume of transactions internally or for whatever reason, right? It's very common to outsource underwriting to MGAs and MGUs. And I think a lot of companies try to put some sort of profit or growth contingency into the compensation mix for the broker in order to better align incentives. We're not in that space and we're not considering it. You know, our business model is to control the underwriting, provide the best customer service in the industry. I think we also offer the broadest risk appetite. So a lot of the business we write falls out of the delegated or binding programs that are in the marketplace. So really for those reasons, no, we're not considering a change in our compensation model. Thank you.

Our next question comes from Mark Hughes from Truist. Please go ahead. Your line is open.

Yeah, thank you very much. Congratulations, Brian, and also Stuart. Thank you. Thanks, Mark. Current accident-year loss ratio was up a little bit. Was that mixed? Was that competitive pressure? What would you say that was caused by?

Mark, I would just kind of write that off to normal variability. You know, the overall numbers are phenomenal. You know, the reported losses are coming in below expectations. We're always trying to be cautious with our reserving. You know, you can look around the industry. There's a lot of examples of companies that are too optimistic in their loss reserving. We never want to be in that group. So, candidly, I would look at the loss performance as good news. Admittingly, it was up a couple points, but to me, that's just normal kind of variability.

Yeah. Brian, Petrocelli, the seeded premium, it's 17%, and then the expense ratio is 21. Given kind of the reinsurance structure at this point, the seeding commissions, are those reasonable starting points for the next few quarters?

I think so, Mark. So this is the first full quarter that we've had with the new reinsurance terms. So it's a pretty good match for you. I would say mix of business is always going to drive a little bit of variability in that. But I think as we sit now, that's as good a guess as we can give you.

Yeah, very good. And one final question. The state ENS data in some of the coastal states, Florida, Texas, new york um it looked like your growth was a little faster there kind of implying that maybe in other states growth was a little slower is that a correct perception is there anything um we should read into that or the uh non-coastal you know states perhaps a little more competitive um is there anything uh anything to think about there mark this is brian hey i wouldn't read too much into it we don't we don't

We don't know exactly how those numbers are calculated, and we don't do anything to try to match them up with our own data.

I think it's better to look at those state tax numbers over a number of months. I think there's a little bit more credibility the further you look back.

Well, if we put those numbers to the side, would you say there's any sort of dynamic

non-coastal you know the kind of those traditional ens states the new york california texas florida are they are you seeing more opportunity there perhaps than elsewhere or would you not see it that way no i think i think it's it stayed relatively the same since martin stewart relatively the same since um you know we've been in business with those obviously the core ens states are going to be the largest bulk of our business um but i haven't seen a mix in that changing that Very good. Thank you.

Thanks, Mark.

Our next question comes from Andrew Anderson from Jefferies. Please go ahead. Your line is open.

Hey, good morning. You know, I think maybe five to seven years ago, you kind of had talked about how there were certain areas you don't write, like public company, DNO, or trucking. Maybe just bigger picture. Are there pockets that five to seven years ago you did not write, and now you're kind of rethinking that and perhaps see some new opportunities for growth?

Well, there's a bunch of examples. We've made a bigger push into homeowners. We started an agribusiness division. We started an aviation division, ocean marine. We're always enhancing the product line.

Yeah, we're always looking at new products. And it's not that we don't write that. We want to write it on our terms and our pricing to maintain our margin. So if you look at commercial auto, We write a lot of auto-adjacent, wheels-adjacent business, but we will look at some small fleets at Tyler Tarff. It's just not the large trucking schedule. So we will take a look at these accounts, but it's going to be a little more controlled.

Got it. And on the net commission ratio, about 10.5 in the quarter, and recognizing there was some change to reinsurance, but the direct commission was pretty much unchanged? Yes. But if we go back a few years when the mix was more tilted towards casualty, it was kind of in a 12% to 13% range. Could we see it getting back up to that level? Or are there some offsets within there that might help keep it maybe around 11% or so?

Again, I think the 10.7 is as good a guide as we can give you. If we did have change in mix of business, you could see that move around a little bit. know whether that goes up to 12 or 13 i bet you know who knows but i think the best guide we can give you is what what we have here for this first full quarter uh since those agreements have been in place thank you our next question comes from andrew kliegerman from td cowan please go ahead your line is open hey good morning congrats to brian and stewart and uh first question is

on the net reserve release of 10 million or 3.7 points. Just curious as to what the kind of mix on that was, you know, short tail versus casualty, maybe on the casualty side vintage. Just kind of curious on the breakdown of that release.

Andrew, this is Mike. I would say, without getting too specific, the last couple quarters, maybe even the last two years, including this quarter, most of the releases have been disproportionately on our first party business. So short tail business like property.

Got it. Okay. And I've been noticing when talking to some of your competitors, some of them starting up micro and small, maybe even mid businesses, but I'm seeing a lot of micro and small startups in the ENS area. Could you talk a little bit about maybe the number of competitors you're seeing in that area versus, say, three years ago?

I think we have more competitors today than three years ago, but it's not just insurance companies. There are hundreds and hundreds of MGAs that have started in the last several years. You know, there used to be one fronting company. Somebody told me the other day they're now 30. You know, so a lot of capital has come into the industry, and there's just a lot more competition that reflects that, and that's certainly not new. I mean, it's always been a cyclical business, and, you know, we're hardwired to compete and win in this environment, I think.

Got it. And the last one... In your commentary, you talked about rates in property. I heard the word stabilizing. I heard moderating. Could you possibly put some numbers around where rates were in property? I think you said that it started to inflect at the end of the second quarter. Maybe where were rates early in the second quarter going and maybe where are they now? Just to kind of get some numbers around that commentary.

I don't have the exact numbers in front of me. I would have said it was double digits in the second quarter down. If I had to guess now, I'd say it's probably single digits down. Let's call it high singles. I don't have it in front of me, so that's just an absolute speculative guess. But I do get the sense that, at least in the part of the market we're in, you have seen that inflection point, and I would expect to see that trend continue. I think it's going to normalize relatively quickly.

Thanks. Thanks for the insights.

Our next question comes from Ryan Tunis from Cantor Fitzgerald. Please go ahead. Your line is open.

Hey there. Good morning. I guess just to follow up on the underlying loss ratio, it sounded like you attributed kind of the two point year over year increase to just normal variability. Does that imply that We're not yet seeing pressure on that ratio coming from property lines?

No, we're not seeing pressure on our loss ratio from property lines because we've overperformed in property. That's why, you know, a disproportionate amount of the reserve redundancy has come from the short tail lines like property. We've had great experience on property. And I think that's a tailwind. I think where we're being more cautious, and it's not because we're seeing, you know, any kind of negative trend. It's just that on long tail casualty, there's a higher degree of uncertainty. It just takes time for those accident years to mature. And coming out of a period a few years ago where we had a significant uptake in inflation, you know, all sorts of supply chain disruptions with COVID, You know, we saw some of our long tail lines develop a little bit higher and a little bit later than we would have anticipated. And, you know, starting several years ago, we've addressed that with much more conservative law specs. And so, you know, we're maintaining that conservatism to make sure that we, you know, we always have more than enough. We want our reserves to kind of develop favorably year by year. And when that happens, you know, it just has a very therapeutic effect on the financial performance of our business.

That makes sense. And I guess just a follow up on the property. Yeah, I guess it makes sense naturally that there'd be less pricing pressure in the third quarter simply because there's there's fewer like Florida sheldon layer renewals is i mean at what extent is the improved pricing environment just sort of a function of uh seasonal mix if you will well i'm going to start by just saying we didn't say it improved it deteriorated at a slower rate yeah i would i would characterize it more as um

You know, rates were going down so fast that the faster rates go down, the quicker they're going to normalize because the industry can't go around giving, you know, double-digit rate increases indefinitely. And I think we've reached that point where you saw that, you know, second-order derivative turn positive. So I don't think it's based on the third quarter being less, you know, hurricane-intensive. Got it.

Thanks for the answers.

Our next question comes from Joe Tomeo from Bank of America. Please go ahead. Your line is open.

Hey, good morning, guys. Most of my questions have been answered, but I guess the first question I'm thinking about, I appreciate the submission rate was decelerating a little bit due to commercial property. If we exclude commercial property, has the submission rate kind of remained steady, or has that also kind of decreased along with the ex-property premiums?

It's closer to around 9% excluding commercial property.

Okay, great. Thank you. And the other question I'm just thinking about, I saw you guys kind of stepped up the share repurchases this quarter from the $10 million from the previous one. Just kind of thinking, was that just more opportunistic where you saw the share price going, or is that more of a function of kind of lower growth and a lot of the cash flow? I know you guys have mentioned before about kind of keeping the business kind of efficient with capital.

I think it's the latter, Joe. You know, we're generating mid-teens ROEs on a year-to-date basis, and it I think our year-to-date growth rate is high single digits. So we're definitely producing a lot of excess capital. And our first goal is always to grow the business. And then secondarily to that, last couple of years, we've been looking at a very small dividend and a very small share repurchase. But I think both of those could continue to grow.

Great. Thank you, guys.

Our next question comes from Pablo Singzon from JP Morgan. Please go ahead. Your line is open.

Hi. Good morning, all, and congrats, Brian and Stuart. So first question, with premium growth having slowed, how do you think about other underwriting expenses over the next one to two years, right? So I think over the past several years, that's been a good story. But, you know, given that growth has slowed, are you managing that line to sort of trail the growth in premiums or, you know, just given where you think opportunities might lie, there's a chance that you might see some degradation as you're building up your opportunity.

I think we have always worked like crazy to be as efficient as we can as a business, you know, given the industry that we compete in. And I think the other underwriting expenses will gradually come down over time as we drive productivity gains in the business through technology, et cetera. I don't think it's going to be sudden, but I think a gradual decline is, you know, what investors should expect.

Okay. And then, I guess, second question also related to expenses, right? So, clearly, I think sales and expense advantage over, you know, the rest of the industry. I'd be curious to hear your thoughts about, you know, whether or not you're willing to trade some of that expense ratio to generate higher premiums and running income. I guess even if that trade is possible to begin with, right? Or are you sort of happy with the current configuration of pricing, profitability, and volume?

Look, I mean, I think there's just a clear recognition that the customers we serve, principally small business owners, are intensely focused on limiting how much money they spend on insurance. And so we're doing everything we can to be as efficient as possible, to give them competitively priced insurance policies, but also to protect our margins. So I don't see an advantageous trade where we would deliberately raise our costs, become less competitive, and somehow that's going to net, you know, a better opportunity for our company.

Okay.

We're going to continue. Sorry, Mike. Go ahead. Yep. I was just going to say, we're going to continue to work, you know, do everything we can to be the efficient insurance provider in the ENS space.

Gotcha. And then just one small one. On reinsurance retention, do you think that could go up again in the next couple of years or you don't see any change from current status quo? Thank you.

Yeah, again, I think what you're seeing this quarter is our best guess. Now, if we had some dramatic mix of business, it could move – one way or the other.

But our retention has changed many times over the years. It has, yeah. Right. We've taken a bigger net position over and over again, and that's just consistent with our growth as a business.

Okay. Thank you for your answers.

Our last question comes from Casey Alexander from Compass Point. Please go ahead. Your line is open.

Yeah, good morning, and congrats to Brian and Stuart, particularly to Brian on his retirement. I'm sure that's something that we all look forward to. Not to beat a dead horse, not to beat a dead horse, but Brian, I am particularly taken by your comments that the property rate decline is stabilizing simply because in 20 years of covering property in the Southeast, particularly in the Southeast U.S., when you have a year like this, has a particularly low level of cat activity at least up to date fingers crossed right you never know what happens in the month of november it tends to attract alternative forms of capital that see very low loss ratios and think that they can get into the business and they tend to get into the business in commercial because it's quicker than residential and it's irrational and so i just wondered Does that not concern you that you're possibly going to see alternative capital in 2026 enter the property market and leading with some irrational pricing structures?

You might be right. I was kind of referring more to the dynamics in the third quarter. So who knows?

Okay. Thank you.

We have no further questions in queue. I'd like to turn the call back over to Michael Kehoe for any closing remarks.

All right, well, we appreciate everybody joining us and look forward to speaking with you again here in a few months. Have a great day.

This concludes today's conference call. Thank you for your participation. You may now disconnect.