Bermuda-based Conduit Re delivered an 11.1% return on equity for 2025 despite absorbing its largest-ever catastrophe loss from the California wildfires, lagging well behind rivals as the reinsurance sector posted some of its strongest results in years.
Parent company Conduit Holdings reported comprehensive income of US$116.8 million for the year ended Dec. 31, whilst gross premiums written reached US$1.24 billion, representing a 6.9% increase from 2024.
The California wildfires contributed 15.3 percentage points to the combined ratio, pushing the full-year undiscounted figure to 101.5%.
The performance sits roughly 600 basis points below the broader reinsurance sector, where Fitch expects the Bermuda market to deliver a 17% return on equity for 2025.
Leading competitors posted significantly stronger results: RenaissanceRe reported a 25.9% return on average common equity for full year 2025, whilst Arch Capital achieved 21.2% in the fourth quarter.
The composite of US-Bermuda reinsurers posted a 16.8% return on equity in 2024, demonstrating that even established players outpaced Conduit Re's 2025 result by roughly 570 basis points.
Chief executive officer Neil Eckert (pictured above) said the company has accelerated a strategic pivot away from quota share business toward excess of loss treaties to reduce attritional losses and improve diversification.
The shift marks a reversal from 2022, when Conduit Re's portfolio split stood at 64% quota share to 36% excess of loss – well off the company's original target of 48% to 52%. Eckert disclosed plans during H1 2025 to rationalize quota share exposure whilst increasing appetite for excess of loss business.
"After a difficult start to 2025, we are pleased to have delivered an 11.1% RoE for the year," Eckert said, noting that earnings were supported by strong investment performance and benign claims activity during the second half.
The company renewed and enhanced its retrocession program in January with reduced net retention for peak and secondary perils compared to the prior year. Eckert said this work was critical to improve portfolio resilience and better manage earnings volatility.
Net investment results totaled US$119.5 million, generating a return of 6.7%. The performance included growth driven by an expanding investment portfolio and unrealized gains, with net investment income rising 24.2% over 2024.
Conduit Re declared a final dividend of US$0.18 per common share, bringing the full 2025 dividend to US$0.36 per share. Share repurchases totaled US$12.5 million during 2025, with an additional US$5.4 million completed through Feb. 17, 2026.
Market conditions remain adequate in most lines of business, though continued softening could lead to moderating premium growth during the year, particularly in property and specialty segments, the company said.
"As markets softened in 2025 and into 2026, our growth rate has moderated as we have reduced or exited business that did not meet our pricing or performance standards," Eckert said.
Tangible net assets per share increased 11.9% to US$7.14 as of Dec. 31, 2025, including dividends paid during the year.
