W.R. Berkley Corporation

Ladies and gentlemen, thank you for joining us and welcome to the W.R. Berkley Corporation second quarter 2026 earnings call. This conference call is being recorded. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please raise your hand. If you have dialed in today's call, please press star one to raise your hand. and Star1 to withdraw your question. The speakers' remarks may contain forward-looking statements. Some of the forward-looking statements can be identified by the use of forward-looking words, including, without limitation, beliefs, expects, or estimates. We caution you that such forward-looking statements should not be regarded as a representation by us that the future plans, estimates, or expectations contemplated by us will in fact be achieved. Please refer to our annual report on Form 10-K for the year ended December 31, 2025 and other filing made with SEC for a description of the business environment in which we operate and the important factors that may materially affect our results. W.R. Berkley Corporation is not under any obligation and expressly disclaims any such obligation to update or alter its forward-looking statements, whether as a result of new information, future events, or otherwise. I would like to turn the call over to Mr. Rob Berkley. Please go ahead, sir.

Thank you very much, and let me echo your welcome to all participants. Thank you for finding time in your schedule to join us today. So I'm joined on this end of the phone by Rich Baio and we're going to follow our typical agenda where momentarily Rich is going to walk us through some highlights from the quarter. I will then follow with a few of my own observations and then the two of us will be available to answer any questions that participants may have. Before I do hand it over to Rich, I'd like to take a moment on behalf of my colleagues, my family and myself to express our gratitude for the very kind outreach and support we have received on the heels of the loss of our founder, Bill Berkley. His extraordinary contributions to society, our industry and our company cannot be overstated. His spirit, values, and priorities remain foundational to who we are and how we operate as a team. One of his great achievements while leading this company was the institutionalization of the business and making clear that this business is a team sport, not an individual one. While his vision and character remain central to our foundation, The performance and success of this company continues to be a reflection of the hard work and commitment of thousands of people that make up this team. Thank you again to all of those who have been so supportive during this difficult moment. Rich, if you would, please.

Of course. Thank you, Rob. Good evening, everyone. Operating earnings per diluted share grew 21% to $1.27, or $497 million. resulting in an annualized return on beginning of year equity of 20.5%. The company's second best quarterly pre-tax underwriting income of $318 million and record quarterly pre-tax net investment income of $419 million contributed to the excellent second quarter results. We continue to generate meaningful excess capital as evidenced by total capital return to shareholders of $334 million to regular and special dividends as well as share repurchases. While there's no predetermined amount of capital to be returned each quarter, this amount is consistent with what we did in the first quarter. Underwriting performance yielded a current accident year combined ratio excluding catastrophe losses of 88.1% and a calendar year combined ratio of 90%. Cat losses in the current accident year decreased $37 million to $62 million in the second quarter of 2026, or two loss ratio points compared with 3.2 loss ratio points in the prior year's quarter. The current accident year loss ratio excluding cats of 59.6% compared with 59.9% in the prior year. The overall expense ratio is flat quarter over quarter at 28.5% and remains below our previously shared expectations, that being comfortably below 30%, but increasing modestly over 2025, barring material changes in the marketplace. Drilling down by segment, insurance reported growth in gross premiums written of 5.4% to a record $3.8 billion, and net premiums written increased 3.7%, also to a record $3.1 billion. The current accident year loss ratio excluding CATs is 61%, comparable with the first quarter this year. The expense ratio of 28.3% was flat over the prior year, bringing our current accident year combined ratio excluding CATs to 89.3%. The reinsurance and monoline excess segment continued to experience heightened competition in both property and casualty lines, which resulted in a decrease in net premiums written to $306 million. Having said that, the underlying performance of the business benefited in the quarter from lower CAT and non-CAT property losses, giving rise to a current accident year combined ratio excluding CATs of 78.7%. Turning to investments, Net invested assets have grown to $34.2 billion. Strong operating cash flows have contributed to the growth despite the significant capital return to investors. Over the prior 12 months, we've returned capital of more than $1.3 billion, or approximately 14% of stockholders' equity, and nearly 70% of the first half of 2026 earnings. Strong second quarter operating cash flow was $800 million and will continue to contribute to the growth in net investment income. Income from the core portfolio growth 13% over the prior year to $371 million, and investment funds performed well, growing 5.6% to $28.8 million. The credit quality of our portfolio remains very strong at AA-, with the duration on our fixed maturity portfolio, including cash and cash equivalents, increasing in the second quarter to 3.2 years, which remains below the average life of our insurance reserves. The effective tax rate of 21.4% was below our normalized run rate of 23% plus or minus due to the mix of earnings from foreign operations taxed at higher marginal tax rates as well as the non-recurring utilization of certain tax credits. Stockholders' equity increased to a record of more than $9.8 billion and capital returned to shareholders comprised regular and special dividends of $223 million as well as share repurchases of approximately $111 million. Rob, with that, I'll turn it back to you.