5th Mar 2026 11:55
(Alliance News) - Lancashire Holdings Ltd on Thursday reported an annual profit downturn, as higher costs weighed on the bottom line, offsetting revenue growth.
The Hamilton, Bermuda-based insurance firm's pretax profit fell 9.4% to USD304.9 million in 2025 from USD336.7 million in 2024. Insurance service expenses were 22% higher on-year, creeping up to USD1.45 billion from USD1.19 billion.
Gross premiums written improved by 5.1% to USD2.26 billion from USD2.15 billion, while insurance revenue rose 5.4% to USD1.86 billion from USD1.77 billion, for a net insurance and investment result of USD496.2 million, up from USD488.2 million on-year. The firm's total investment return grew to 7.0% in 2025 from 5.0%.
Nonetheless, with costs dragging on the bottom line, diluted earnings per share slipped to USD1.17 from USD1.30.
Lancashire has declared a final dividend of 15 US cents, plus a special dividend of 50 cents per share, but its total dividend is 17% lower on-year at USD1.225, down from USD1.475.
Its shares fell 3.8% to 625.16 pence late Thursday morning in London.
Chief Executive Alex Maloney maintained that 2025, which marked the company's 20th anniversary, was "successful... with strong underwriting profit supported by healthy investment returns."
"We have increased our resilience and significantly reduced volatility in our earnings. This has enabled the group to deliver an excellent outcome for shareholders and positions the business to capture future market opportunities," Maloney said.
"Lancashire is a very different business now compared to just a few years ago. That is evidenced by today's results, as well as the confidence we have as a management team to continue to deliver sustainable returns over the coming years."
The CEO continued: "We have always believed in the market cycle and that successfully managing its varying phases is the key to long-term and sustainable value creation. Looking ahead, while we expect 2026 to be more competitive, we are still in a healthy place when it comes to rate adequacy. We continue to take advantage of underwriting opportunities, with our usual focus on disciplined underwriting and actively managing capital and risk exposures."
By Holly Munks, Alliance News reporter
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