RLI Corp. Kicks Off 61st Year with Strong Q1 Performance
Racing into its 61st year, RLI Corp. has started 2025 on a high note, showcasing impressive growth in book value and top-line premiums while maintaining a combined ratio of 82%. The company's continued success is a testament to its unique franchise built on customer service ownership, talented people, and a deep understanding of the insurance market.
During its first quarter earnings call, RLI Corp.'s President and CEO, Craig Kliethermes, emphasized the company's ability to navigate and thrive through periods of market disruption. He noted that despite facing various challenges in the past, including soft market years at the turn of this millennium, the financial stress and credit crunch of 2008, and economic supply chain and contract uncertainty during the COVID pandemic, RLI Corp. continued to grow profitably while delivering exceptional service to its customers.
With a healthy balance sheet that enables it to adapt to changing market conditions, RLI Corp. has positioned itself for success in today's increasingly complex insurance landscape. The company's narrow and deep underwriting and claim expertise, combined with a diverse portfolio of specialty products, allow its underwriters to make informed decisions and take calculated risks.
According to Todd Bryant, Chief Financial Officer, the company's operating earnings of $0.92 per share were supported by solid underwriting performance and a 12% increase in investment income. This growth is attributed to continued expansion in earned premium and favorable prior year's reserve development across all three segments. The total combined ratio of 82.3% was up from last year's due to lower levels of favorable prior year's reserve releases and a slight increase in the underlying combined ratio.
RLI Corp.'s focus on opportunities where it has the expertise to differentiate itself and the market supports adequate returns is a key factor in its success. The company remains committed to pushing itself by raising the bar in pursuit of excellence and continuously building on its strengths. As Craig Kliethermes emphasized, "We are playing the long game."
The insurance industry is facing rising challenges such as legal system usage, trade disruption, and economic uncertainty. However, RLI Corp.'s experienced management team is well-equipped to manage through these challenges. With owners who are empowered to execute and confidently manage through whatever the market presents, the company is poised for continued success in 2025.
