Risk Reward Update

Research evidence excerpt

Risk Reward Update

UpdateM

Risk Reward – Lancashire Holdings Limited (LRE.L)

KEY EARNINGS INPUTS

Drivers Dec 2025 Dec 2026e Dec 2027e Dec 2028e

Gross premiums written growth (%) 5.1 (2.2) 3.0 3.0

Insurance revenue growth (%) 5.4 1.8 3.0 3.0

Group combined ratio (%) 83.7 80.9 81.9 81.9

Group undiscounted combined ratio

93.1 90.1 91.1 91.1

(%)

INVESTMENT DRIVERS RISKS TO PT/RATING MS ESTIMATES VS. CONSENSUS

Net earned premiums RISKS TO UPSIDE FY Dec 2026e

P&C rates Growth above our expectations 1.14 Attritional loss ratio Further extension of improved pricing EPS

Benign catastrophe environment leading to conditions in both primary commercial and (US$) 0.82 1.60

strong capital return reinsurance 1.22

Better than expected claim patterns

GLOBAL REVENUE EXPOSURE RISKS TO DOWNSIDE DPS 1.23

0.98 1.49

APAC, ex Japan, Mainland Waning P&C pricing gains (US$) 0-10% 1.21 China and India Large catastrophes leading to severe losses

0-10% Europe ex UK impacting capital, growth and dividends

0-10% Latin America Increased exposure to inflation risk from 288

0-10% MEA ongoing shift in business mix Net income 175 367

0-10% UK (US$, mn) 292

80-90% North America

OWNERSHIP POSITIONING

Source: Morgan Stanley Research Estimate Mean Morgan Stanley Estimates

View explanation of regional hierarchies here Inst. Owners, % Active 83.8% Source: Refinitiv, Morgan Stanley Research

HF Sector Long/Short Ratio 2.2x

MS ALPHA MODELS HF Sector Net Exposure 18.6%

1/5 3 Month Refinitiv; MSPB Content. Includes certain hedge fund

MOST Horizon exposures held with MSPB. Information may be

inconsistent with or may not reflect broader market

Source: Refinitiv, FactSet, Morgan Stanley Research; 1 is trends. Long/Short Ratio = Long Exposure / Short

the highest favored Quintile and 5 is the least favored exposure.