Palomar Holdings Shatters Records, Demonstrates Resilience Amid Market Volatility
Specialty insurance company Palomar Holdings Inc. has made a compelling statement with its second-quarter 2026 earnings, posting another strong performance that reiterates its ability to navigate the dynamic insurance market.
According to the Q2 2026 conference call transcript released on August 5th, 2026, Palomar delivered record-adjusted net income, beating earnings expectations for the 15th consecutive quarter. The company's gross written premium increased by a staggering 27% year-over-year, while adjusted net income grew 31%, and adjusted earnings per share rose 34%. The adjusted combined ratio of 77% and the adjusted return on equity (ROE) of 26% further solidify Palomar's position as a leading player in the specialty insurance market.
Palomar's diversified portfolio remains one of its greatest strengths, comprising approximately half property business, with nearly 20% generated from lines that are not correlated to traditional P&C market cycles. The deliberate diversification strategy has proven successful, translating into strong and profitable growth, as well as an industry-leading ROE that has remained resilient through all market cycles.
As portions of the commercial property market continue to soften, Palomar's diversified portfolio provides stability and opportunities to deploy capacity into areas where risk-adjusted returns remain attractive. The breadth of business allows Palomar to differentiate itself from competitors and consistently generate profitable growth while maintaining best-in-class financial metrics.
The company's earthquake franchise has seen year-to-date written premium increase by 1% year-over-year, with gross written premium down less than a percentage point during the quarter. However, residential earthquake continues to serve as a stable foundation for both the franchise and Palomar overall, representing approximately 64% of the earthquake book.
New business production was very strong in the quarter, with both new business premium and policy count increasing year-over-year from the second quarter of 2025. Premium retention exceeded 96%, and renewal policies continue to include a 10% inflation guard. Palomar continues to closely monitor the inflation guard and price elasticity, encouraged by the residential book's strong premium and policy retention.
With its record results and diversified portfolio, Palomar Holdings has demonstrated its ability to adapt and thrive in an ever-changing market environment. The company's commitment to disciplined underwriting and capital allocation remains unwavering, ensuring a bright future for investors and stakeholders alike.
