Arch Capital Group (ACGL) Q3 2026 earnings summary

Executive summary

• Adjusted after-tax operating income was $910M, or $2.67 per diluted share; annualized operating ROE was 16%.

• Returns remained strong despite increasingly competitive markets; tangible book value per share excluding AOCI rose ~15% YoY.

• Management prioritizes long-term risk-adjusted returns over premium growth, staying selective as markets transition and become more uneven.

Financial highlights

• Gross premiums written were $5.391B, down 0.4% YoY; net premiums written were $3.845B, down 3.0%, and net premiums earned were $4.014B, down 6.3%.

• Current-year catastrophe losses were $234M net of reinsurance and reinstatement premiums; prior-year reserves developed favorably by $179M.

• Net investment income was $451M; equity-method investment income contributed $224M. Net realized investment losses were $99M.

• Invested assets totaled $49.2B at September 30, 2026; TTM gross premiums written were $22.8B and TTM net investment income was $1.710B.

• Operating cash flow was $1.8B; the effective tax rate on pre-tax operating income was 15.8%.

Outlook and guidance

• Insurance underlying growth remains low single-digit after planned middle-market program reductions; 2027 opportunities include selected casualty, specialty and U.S. middle-market lines.

• Reinsurance top line faces pressure in property, catastrophe excess-of-loss and other short-tail lines; rate pressure is expected to continue into 1/1 renewals.

• Similar marine war-risk premium levels are expected in Q4; further volumes depend on developments in the region.

• Insurance expense ratio may decline modestly as Bermuda QRTCs rise in 2027 and middle-market integration duplication subsides; expenses are expected to track premium growth, subject to cost management.

• Reinsurance underlying loss ratio may rise gradually by a couple hundred bps as rates fall, depending on renewals and business mix.