Kinsale Capital Group, Inc.

increased 9.4% over the third quarter of 25, generating an annualized operating ROE of 25.6% through nine months. Gross written premium was down 4.8% and net written premium was down 1.5%. Consales combined ratio was 75.4% for the quarter. E&S market conditions in the third quarter continue to be competitive. and largely consistent with conditions in the second quarter. The level of competition and our growth rate continues to vary from one market segment to another, as you can see from the premium by underwriting division exhibit in our queue. And I'm sorry, we've got a fire alarm going off in the building adjacent to ours. We're gonna keep persevering here. The continued intense competition in our commercial property division weighed on our growth rate in the quarter, and excluding that one division, our gross written premium was down half a percent. It's also important to note that even with the drop in gross written premium for the quarter, Kinsale's number of submissions, quotes, and bind orders grew in the mid single-digit range. Essentially, with the competition in the E&S market, our books shifted slightly from larger to smaller accounts. Not only is this shift positive for maintaining best-in-class margins, but it also shows that the ConSale model works and works well even in the most competitive market we've seen in the last 10 years. Our disciplined underwriting and low-cost business model recognizes the importance of the insurance buyer in every transaction. We deliver competitively priced insurance without compromising our margins and we continue to grow the business and take market share subject only to a temporary written premium growth slowdown as we shift slightly away from larger transactions and write a slightly smaller average premium. While Kinsale always prioritizes profit over growth, we are still working very hard to grow the business. The various growth initiatives involve new and enhanced products, appointing new brokers, a robust marketing effort, and improved customer service. Stuart Winston will have some commentary on these topics here in a moment. In this era of artificial intelligence, Kinsale's longstanding strategy of making technology a core competency is allowing us to widen our lead over many competitors. Kinsale's core enterprise system is custom-built for our business. by our own engineers, analysts, and developers. We don't have any legacy software applications dating back decades ago. We also have all the company data from the first policy we wrote or the first claim we received 17 years ago recorded in the same database. ConSales TechAdvantage allows for lower costs, better customer service, and more data at the transaction level to better manage the business. Further, we have built our analytics and actuarial team over the last decade to constantly evaluate our own data and data that we acquire to improve how we segment and price risk. This team of quants combined with millions of dollars of investment and further combined with a superior tech stack is creating underwriting and pricing algorithms superior to others in the E&S industry. And Salmaan Allibhai is going to have some further comments on this topic in a moment as well. And with that, I'm going to turn the call over to Chris Tangard.

Thanks, Mike. Good morning, everyone. Before I provide commentary on our quarterly results, I want to recap our capital allocation priorities and recent actions, particularly in light of the current competitive environment that Mike mentioned. Our first capital allocation priority is to fund growth in our high margin insurance business. Our second priority is to return excess capital to stockholders, primarily through share repurchases. We also pay a dividend that, while modest, has increased at a 17.5% compound annual growth rate since our IPO in 2016. We have no interest in M&A. Over the last several years, we've generated significant capital in excess of what we need to operate the business in the current lower growth phase of the cycle. This excess capital generation continues today. As a result, in the third quarter, we repurchased 269,000 shares at an aggregate cost of $100 million or just under 80% of net operating earnings in the quarter. The $100 million is consistent with the second quarter and an increase from the $62.5 million in the first quarter of this year. At this time, we expect $100 million to be a good quarterly run rate and plan to be opportunistic otherwise. Our debt to total capitalization is low at approximately 10% and should we need additional capital in the future, we would likely look to use leverage to generate higher returns on equity. Moving on to our financial results for the quarter, diluted earnings per share declined 28.4% and diluted operating earnings per share increased 9.4% compared to the third quarter of last year. Annualized return on equity and annualized operating return on equity for the nine months ended September 30th were 26.6% and 25.6% respectively. The decline in GAAP earnings was primarily driven by our sale of certain fixed maturity holdings in a loss position, largely offsetting our selling of certain equity investments in a gain position as we repositioned the investment portfolio. With the proceeds from these sales, we reinvested approximately $100 million in higher conviction equity securities and replaced approximately $130 million of bonds yielding less than 2% with bonds yielding more than 5.5%. As the unrealized appreciation of equities is recorded through earnings each quarter, the majority of the equity gains were reflected in earnings in prior periods. Conversely, the loss on the fixed maturity holdings was reflected in earnings upon sale. The net pre-tax earnings impact of the bond sales was $37.6 million or $1.67 per diluted share in the third quarter. The sales had no impact on book value. Stripping out the investment noise diluted operating earnings per share improved to $5.70. Quarterly combined ratio was 75.4% compared to 74.9% in the third quarter of 2025. The loss ratio improved to 53.4% from 53.9%, largely driven by higher favorable prior year development. The expense ratio increased one point to 22% from 21%, primarily due to higher net commissions resulting from higher reinsurance retentions, which results in lower seating commissions. The higher retention is an intentional trade to retain more underwriting margin and float to generate investment income, which results in a slightly higher expense ratio. As a result of these changes to our reinsurance program, which renewed on June 1st, The retention ratio increased to 86.2% in the third quarter compared to 83.3% in the third quarter last year. The other underwriting portion of the expense ratio, which is the best measure of the operational efficiency of our business, was 10.2% for the third quarter of 2026, flat compared to the same period last year. Turning to investments, net investment income increased 17.5% to $58.3 million. as a result of both a higher invested asset base and higher interest rates. Kinsale's float increased to $3.5 billion at September 30th, up from $3.1 billion at year-end 2025. New money yields are averaging north of 5%, and the fixed maturity portfolio has an average duration of 4.4 years. Overall, we're pleased with our third quarter performance. We continue to produce best-in-class underwriting results, attractive investing returns, and strong returns on equity while returning meaningful capital to stockholders. And with that, I'll turn it over to Stuart.

Thanks, Chris. At the risk of sounding like a broken record, the soft E&S market continued in the third quarter across property in certain long-tail casualty lines. However, there are some favorable areas in the market that we are turning into growth opportunities. Our goal as an underwriting organization in a softer, softening market is to grow where we can, but more importantly, maintain our profitability. We will continue to be aggressive where we can, but at the same time maintain a conservative stance in areas where we feel irrational competition has taken hold. We offer our brokers one of the broadest risk appetites in the E&S market. We will continue developing new products and adding underwriting flexibility where it makes sense, further expanding that appetite. The breadth of our underwriting appetite allows us to pivot to the areas where growth is promising and take advantage. Divisions like agribusiness, communication, commercial auto, entertainment, ocean marine, and environmental all experience double-digit growth for the quarter. We continue to see favorable underwriting conditions in excess casualty, allied health, products liability, healthcare, energy, and agribusiness property as well. Before I move on, I want to briefly address the most recent CAT activity in the quarter, and we expect its impact on our results to be immaterial. Moving on, overall new business submission growth increased 6% in the third quarter, a similar rate to Q2 of this year. We continue to see a decline in new business submissions in the commercial property division that handles large shared and layered deals. Excluding the commercial property division, new business submissions were up 10% for the quarter, and over half of our divisions are seeing submission growth in the double digits. While our lines of business are experiencing varying levels of competition and pricing pressure, The combined pricing trend for KinSale is in line with the AmWins pricing index, which showed a decrease of 3.1% compared to 5.9% decrease in Q2 2026. While we continue to see strong rate pressure in commercial property, other lines like commercial auto and excess casualty and entertainment present opportunities for meaningful rate increases. Distribution and product expansion continue to drive growth. On the product side, we're looking to finish the year by rolling out an additional five or six new offerings ranging from small package policies to a digital health offering, and Hull and P&I. We continue to look for opportunities in the market to roll out new offerings to broaden our appetite. We also continue to sign up new producers to drive submission growth. During the third quarter, we appointed 12 new wholesale brokers to the KinSale platform and 124 new retail brokers to Aspera, our in-house broker through which we distribute most of our Personal Lines products. The durability of our model continued to show throughout the third quarter. Despite an influx of competition, Submissions, quotes, and binders increased across the company while renewal retention remained steady. New products, in addition to our distribution network, should continue to support growth. At the same time, large accounts remain under downward pressure. We will not chase business where the economics do not make sense. Instead, we will maintain our discipline and continue to focus on the small to medium enterprise space. So to bring it all together, the market is soft and it may stay that way for a while. We aren't going to let the market change how we operate. We will grow where the opportunity is real, we'll hold the line where competition has outrun the risk, and we will never trade profitability for volume. Soft markets don't last forever, and neither do hard ones. What we can control is how we operate in each. A broad risk appetite lets us find areas for growth, our small account focus allows for more opportunities and more favorable rates, and a tremendous sufficiency advantage will support returns as pricing softens. That's our model in a nutshell, and it's designed to perform across the whole of the market cycle. With that, I'll turn it over to Salman.