Fairfax Financial has continued its strong year, reporting net earnings of $1.15 billion for the third quarter of 2025. This compares to net earnings of $1.03 billion in the same period last year.
Book value per basic share was $1,203.65 as of September 30, 2025, up from $1,059.60 at the end of 2024, a 15.1% increase when adjusted for the $15 per common share dividend paid in the first quarter of 2025.
Net premiums written by the property and casualty insurance and reinsurance operations rose 2.1% to $6.56 billion, primarily due to increased retentions in US casualty lines. Excluding Gulf Insurance, gross premiums written increased 3.1%, reflecting new business growth and modest rate increases in certain segments.
The third-quarter performance followed a strong second quarter, when Fairfax reported net earnings of $1.44 billion compared to $915.4 million in the same period last year.
In Q2, the property and casualty segment produced adjusted operating income of $1.13 billion, while net premiums written grew 4.8% to $7.26 billion. The company attributed these increases to new business in reinsurance and casualty lines, as well as higher retention rates.
“We are very pleased to be able to maintain the focus of our insurance operations on property and casualty insurance and reinsurance, while still benefitting from the continued success of the Eurolife life insurance business through our ownership stake in Eurobank." said Prem Watsa (pictured above), chairman and chief executive officer.
Underwriting profit in the property and casualty segment increased to $540.3 million, compared to $389.7 million in the third quarter of 2024. The undiscounted combined ratio improved to 92.0% from 93.9% last year, which the company attributed to lower catastrophe losses and higher business volumes, partially offset by a decrease in net favorable prior year reserve development.
Adjusted operating income for the property and casualty segment rose to $1.34 billion from $1.14 billion, reflecting stronger underwriting, increased interest and dividends, and a modest increase in profit from associates.
The consolidated statement of earnings included a net loss of $307.7 million from changes in discount rates, compared to a net benefit of $63.7 million in the third quarter of 2024. This included a net loss on insurance contracts and reinsurance contract assets held of $263.4 million and net losses on bonds of $44.3 million.
Interest and dividends earned across the company increased to $655.4 million, up from $609.9 million a year ago. Of this, $586.3 million was earned by the property and casualty insurance and reinsurance operations, with the remainder from life insurance, run-off, non-insurance companies, and corporate segments.
At the end of the quarter, Fairfax’s insurance and reinsurance companies held portfolio investments totaling $70.9 billion, excluding Fairfax India’s $2.1 billion portfolio.
The company’s share of profit from associates was $305 million, up from $260.2 million in the prior year. This included $140.7 million from Eurobank, $67.9 million from Poseidon, and $38.8 million from EXCO. Net losses on other investments totaled $54.1 million, mainly due to unrealized losses of $68.8 million on holdings of Digit compulsory convertible preferred shares.
