Insurance - 1Q P&C Granular Detail by Line Underscores Property Durability, Casualty Erosion

Research evidence excerpt

Insurance - 1Q P&C Granular Detail by Line Underscores Property Durability, Casualty Erosion

Truist Securities

Equity Research Report June 4, 2026

FINANCIALS: Insurance

Insurance - 1Q P&C Granular Detail by

Line Underscores Property Durability, Mark Hughes, CFA

615-748-4422 Casualty Erosion Mark.Hughes@truist.com

The new release of 1Q aggregate commercial P&C industry data gives us the

opportunity to evaluate the prospects for further cyclical pricing changes as well as

Maxwell Fritscher the likely trajectory of carrier ROEs. To be clear, the quarterly statutory data does not

404-439-9753 include the expense ratio and so in calculating underwriting profit by line we assume Maxwell.Fritscher@truist.com

expenses are steady with the 2025 full-year results (historically, the standard deviation

in the expense ratio for various lines is in the 1%-2% area).

12 Page Document

Summary:

Reasons for this report It was still good times for P&C earnings in 1Q. The granular data for the quarter

✓ Sector Update shows some corrosion around the edges even as property revenue and earnings were

very durable – seemingly boosted by reserve gains – and investment returns improved,

while the casualty drag was only a little worse.

The 2Q data so far suggests more capital is coming to this party. May E&S numbers

out this week showed increasing pressure on both property and casualty lines with

accelerating downside in coastal risks (see our 6/1 note); the IVANS data was likewise

softer at the start of the quarter.

Overall commercial lines premium decelerated to 3.4% in the period from 3.8%

in 4Q. There was incremental slowing in casualty, consistent with the idea that certain

large carriers and a number of MGAs have leaned into this area to offset moderating

growth in property; see Figure 1.