Lancashire turned a wildfire-ravaged first half into a full-year return on equity of 20.9%, as results from the Bermuda-based specialty insurer showed the benefits of a broader book - but also how far it still trails the sector's best.
The California wildfire crisis had threatened to define Lancashire's 2025. The blazes cost the group $163.4 million in catastrophe losses, driving a combined ratio of 97.8% through June.
Chief executive Alex Maloney told investors at the time that "the resilience of the business is clear, with our greater scale and diversification" - and the second half bore that out. A sharp recovery pulled the full-year combined ratio to 93.1% and profit after tax to $293.4 million, beating the group's own twice-upgraded ROE guidance.
Gross premiums written rose 5.1% to $2.259 billion. Maloney, marking Lancashire's 20th anniversary, said the company had "increased our resilience and significantly reduced volatility in our earnings."
Respectable as that sounds, the results sit in the middle of the specialty pack. Hiscox posted its lowest combined ratio in a decade at 87.8%, with chief executive Aki Hussain calling 2025 "a pivotal year."
At the other end, Conduit Re limped to an 11.1% ROE and 101.5% combined ratio, the wildfire alone adding 15.3 percentage points. Lancashire sits above that floor but well below the ceiling.
More pressing is pricing. Lancashire's insurance segment recorded a renewal price index of 95%, the first year of softening since 2017. Broker data from the January 2026 renewals suggests the slide has steepened.
Howden Re reported the sharpest decline in risk-adjusted global property-catastrophe rates since 2014, with David Flandro warning that "pricing momentum has turned decisively."
Maloney acknowledged 2026 "will be more competitive" but maintained rate adequacy remains healthy.
S&P Global Ratings had upgraded Lancashire from A- to A in December 2025, citing a strengthened competitive position and improved portfolio resilience. The results showed total capital at roughly $2.0 billion.
The board declared a final ordinary dividend of $0.15 and a special dividend of $0.50 per share, bringing total 2025 dividends to $357.0 million. Since inception, the group has returned more than $3.7 billion to shareholders.
