Kingstone Companies has reported its strongest financial results on record, capping a turnaround that has put the small Northeast property and casualty insurer well ahead of far larger peers on a key profitability measure.
The company posted net income of $40.8 million for the year ended December 31, 2025, up 122.1% from $18.4 million a year earlier, with diluted earnings per share rising to $2.88. Fourth-quarter net income surged 171.4% to $14.8 million.
Net premiums earned climbed 45.6% to $187.1 million for the full year, while direct premiums written rose 14.8% to $277.8 million. The net combined ratio improved to 75% from 80%, with annualized return on equity reaching 43%.
That combined ratio is striking in context. AM Best projected the US property and casualty industry combined ratio at 95.0 for 2025, calling it the sector's best in a decade. Kingstone outperformed the personal lines benchmark of 94.0 by some 19 points.
Swiss Re, in its January outlook, pegged the industry figure at 94% but forecast deterioration to 97% in 2026.
The tailwinds may not last. AM Best has warned that rate moderation and loss severity could push the industry ratio to 96.9 this year. Kingstone's own guidance projects a net combined ratio of 81% to 86%, including a catastrophe loss ratio of 7% to 10%, up sharply from 1.2% in 2025.
CEO Meryl Golden (pictured above) described the results as "structural, not simply weather-driven," pointing to the Select risk selection program, which now covers 57% of policies in force.
Kingstone has set a 2029 target of $500 million in direct premiums written and plans to enter California in Q2 as its first move outside the Northeast.
It will be wading into turbulent waters. Enrollment in the California FAIR Plan reached 668,609 policies by year-end 2025, with residential exposure at $645 billion. Munich Re estimated insured losses from the January 2025 Los Angeles wildfires at roughly $40 billion, the costliest wildfire event on record at the time.
Commissioner Ricardo Lara's Sustainable Insurance Strategy, unveiled last year, now permits forward-looking catastrophe models in rate-setting for the first time.
Carriers, including Farmers, Allstate and Mercury have filed under the new framework, though Consumer Watchdog's Carmen Balber has argued it is insufficient, saying the FAIR Plan "added more policies in the last three months than the commissioner's strategy will add in the state in the next two years."
Golden said the expansion would be "supported by an infrastructure that scales with minimal incremental investment." The company grew its catastrophe reinsurance limit 57% to $440 million at its July 2025 renewal and secured a $125 million catastrophe bond via 1886 Re Ltd.
Kingstone projects direct premiums written growth of 16% to 20%, diluted earnings per share of $2.20 to $2.90, and return on equity of 24% to 30%. Applying the 2025 catastrophe loss ratio on an illustrative basis, earnings would reach approximately $3.53 per share.
