W. R. Berkley Corporation delivered record first-quarter operating income and a 21.2% annualized return on equity, with its Q1 2026 insurance results showing the specialty carrier continuing to push rate even as the broader US commercial market softens.
Operating income reached a record $514.3 million, or $1.30 per diluted share, up from $420 million, or $1.05, in Q1 2025. Net income came in at $515.2 million, or $1.31 per diluted share, compared with $417.6 million, or $1.04, a year earlier.
The headline ROE was flattered by a lower effective tax rate of 16.3%, which management indicated on the earnings call would normalize closer to 23% over the rest of 2026.
Gross premiums written rose to $3.79 billion from $3.68 billion, while net premiums written edged up to $3.17 billion from $3.13 billion. Within the insurance segment, gross and net premiums written grew 4.5% and 3.2% respectively.
Average rate increases excluding workers' compensation came in at about 7.2% during the quarter, well ahead of broader benchmarks.
Marsh's latest Global Insurance Market Index put US composite commercial rates down 1% in Q1 2026, and Willis Towers Watson's Insurance Marketplace Realities 2026 report describes nearly every commercial line outside excess casualty as being in soft-market territory.
Swiss Re Institute expects US property and casualty premium growth to slow to around 4% this year.
On the earnings call, chief executive Rob Berkley (pictured above) said the group was "actively rethinking what the balance is between rate versus growth," signaling the company may ease off price in certain lines to pursue volume where margins remain attractive.
He flagged property, particularly reinsurance, as a line where pricing momentum has clearly reversed.
Berkley's outperformance sits against a maturing excess and surplus (E&S) cycle. AM Best shifted its outlook on the US E&S segment from positive to stable in November 2025, citing moderating premium growth and early signs of rate softening.
That said, the agency still expects E&S participants to post more favorable underwriting results than the broader property and casualty industry in 2026.
Net investment income advanced 12.2% to a record $404.3 million, supported by higher invested assets, improved portfolio yields and investment fund contributions. The fixed-maturity portfolio carried an average rating of AA- and a duration of 3.1 years.
The current accident year combined ratio, excluding 2.4 points of catastrophe losses, was 88.3%. The reported combined ratio stood at 90.7%.
Capital returned to shareholders totaled $336.1 million, comprising $302.4 million in share repurchases and $33.7 million in regular dividends. The company bought back nearly 4.5 million shares in the quarter. Rob Berkley told investors the group was generating capital "significantly more quickly than we can consume it," with financial leverage at about 22.6%.
Management said it remained "confident in our ability to exceed our 15% target after-tax return on equity for the foreseeable future."
