SiriusPoint Ltd Stock

Good morning, ladies and gentlemen, and welcome to the SiriusPoint Third Quarter 2026 Earnings Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded, and a replay is available through 11:59 p.m. Eastern Time on November 20, 2026.

With that, I would like to turn the call over to Liam Blackledge, Investor Relations and Strategy Manager. Please go ahead.

Good morning, and thank you for joining us for SiriusPoint's Third Quarter and 9 Months 2026 Earnings Call. Last night, we released our earnings press release, Form 10-Q and financial supplement, all of which are available on our website at investors.siriuspt.com, along with the slides that will accompany today's discussion. Joining me on the call are Scott Egan, our Chief Executive Officer; and Jim McKinney, our Chief Financial Officer.

Before we begin, I'd like to remind you that today's remarks contain forward-looking statements based on current expectations, and actual results may differ materially. We will also reference certain non-GAAP financial measures, which we believe are useful in evaluating the performance of the business. Reconciliations can be found in the presentation and our SEC filings. Please refer to our earnings release and accompanying materials for a more complete discussion of forward-looking statements and non-GAAP measures.

With that, I'll turn the call over to Scott.

Thanks, Liam, and welcome, everyone, to our third quarter and 9 months results call. Before I turn to the results, I want to welcome John Sauerland to our Board of Directors. John brings more than 35 years of insurance industry experience, and I'm sure many of you will know him from his time at Progressive, where he most recently served as Chief Financial Officer. John will be a strong addition to the Board and his appointment speaks to the quality of the business we are building and the ambitions for the future, and I'm really looking forward to welcoming John to SiriusPoint.

Turning to the results now. The third quarter saw SiriusPoint deliver another strong performance with attractive underwriting margins, disciplined growth and returns above our 12% to 15% ROE target range. We continue to demonstrate the strength of our diversified specialty underwriting portfolio, which is increasingly important as pricing becomes more competitive in multiple lines of business. Our business model and approach to the market is delivering strong premium growth in the places we want it and where we see attractive underwriting margins. The performance this quarter is further evidence of our portfolio mix and deliberate low volatility strategy delivering for our shareholders.

Our stated aim is to deliver a 12% to 15% return across the cycle, and this is another quarter where we have exceeded that target and created strong shareholder value. Throughout the 9 months mark, our key takeaways are unambiguous. The business is performing strongly. We are committed to underwriting discipline. We actively and carefully manage our portfolio mix and volatility. We are growing and have a healthy pipeline of business opportunities, and we have a strong balance sheet and can be agile in our deployment of capital. Jim will take you through the full financials later in the call as usual.

But as a brief overview, the third quarter saw us deliver 20% growth in Insurance & Services and a Core Combined ratio of 90.1%. Our operating return on equity was 17.6%. Year-to-date, Insurance & Services has grown by 14%, while overall Core growth of 7% reflects our disciplined approach to reinsurance, where we have shrunk premiums by 6%. On a year-to-date basis, our Core Combined ratio was also 90.1%, and our operating return on equity is 15.8%, above our 12% to 15% target range. Book value continues to compound at a strong rate. Excluding AOCI, our diluted book value per share increased by 4% in the quarter and is now up 12% through the first 9 months.

Core operating return on equity, which excludes the runoff portfolio result, was 18.1% for the quarter and 17% for the first 9 months. This metric becomes increasingly important given today's announcement that we have entered into a loss portfolio transfer agreement with RiverStone that will substantially cover our remaining runoff exposures. The transaction is subject to customary regulatory approvals and following completion, our runoff exposures will be at de minimis levels. Put simply, this transaction allows us to effectively close the chapter on the legacy book once and for all. The transaction is supported by significant limit and strong collateral, while SiriusPoint will retain some responsibility for claims administration.

As I have previously discussed on these calls, the runoff reserves relate to business written before 2023 prior to when the organization pivoted to its new underwriting strategy. They have been running off and reducing over the past 3 years, but carry the potential to cause reserve volatility along the way. Since 2024, pure underwriting losses, excluding claims administration expenses have totaled approximately $60 million for the runoff portfolio. Therefore, we see the mitigation of this uncertainty as a further positive step and one we hope reinforces the earnings strength of our go-forward core portfolio, which, as I said earlier, is operating well above our 12% to 15% return on equity target.

We feel that our reserve position was strong prior to the LPT, reflecting our approach to initially reserving MGAs above pricing projections and our track record of 22 consecutive quarters of favorable prior year releases. Following the transaction, we feel we are in an even stronger reserving position as we have removed what we believe is the greatest element of uncertainty. Jim will discuss the expected accounting impact, but importantly, it also frees up capital tied to these legacy reserves of over $200 million on completion and will increase our BSCR ratio by around 20 points.

I'm sure I will get asked what we plan to do with this capital and our prioritization remains unchanged. We want to deploy it to support our organic growth where it meets our strict underwriting targets. Beyond that, we will continue to be thoughtful and dynamic in our approach to capital management, returning excess capital to shareholders when appropriate. This can be seen by our track record where we have returned $300 million of capital in 2026 alone on top of the $1 billion of capital returned from strategic capital actions between 2024 and 2025.

In line with the established practice we have set out, we expect to provide an update on our capitalization levels and capital return program in the fourth quarter earnings call following the closeout of 2026 and the completion of our 2027 planning process. In the meantime, we will continue with our current buyback program, which we set out earlier in the year. What is clear is that our balance sheet, capital strength and agility have never been higher or stronger, and that's a good thing for all stakeholders.

Looking at Slide 11, where we show our core operating ROE metric. As I noted earlier, this becomes a more important metric as we think about the business performance going forward post the LPT and one that we introduced at the beginning of this year with this evolution in mind. By reducing the earnings drag associated with the legacy book, the LPT should drive greater alignment between our core operating ROE and operating ROE on a go-forward basis. There will still be claims administration and related expenses for a period while it runs off. Our core operating ROE has exceeded our 12% to 15% target for the past 2 years and is above again for the first 9 months of this year. The LPT transaction reinforces the company's ability and confidence to meet or outperform that range going forward.

Looking briefly at Slide 7, our track record for both earnings and value creation is strong and consistent. Operating earnings per share continued to grow and are up 19% in the third quarter and 17% year-to-date versus the prior year. On the back of this, our book value per share continues to compound at a healthy rate with a compound annual growth rate of 19% over the last 3 years. We have grown book value per share by 12% just in the first 9 months, reinforcing that trajectory. These numbers demonstrate our momentum and the consistency, which I believe validates our strategy and approach to building a diversified portfolio that targets disciplined and sustainable growth.

Slide 12 talks to this portfolio and illustrates the scale and breadth of our specialty platform, the meaningful positions we have across multiple lines and our active management of the various pricing cycles. Importantly, where we are growing and where we are reducing exposure is consistent with the market conditions we have been describing to you and those evident across the broader market. We do not need to maintain positions in lines where returns do not adequately compensate for the risk taken. We have other opportunities to deploy our capital more attractively. You can see this in action with solid growth in Accident & Health, Surety and pockets of P&C insurance lines, while we are reducing premiums in aviation and property cat reinsurance.

We are not afraid to either lean in or lean out in specific markets, and Jim will provide more color on each of the specialties later in the call. We also want to outline our plans today to update our segment reporting beginning in the fourth quarter. Since 2022, we have changed significantly and have evolved from our roots as a Bermudian reinsurer into a specialty underwriter with a strong insurance focus anchored around key specialty lines of business. Increasingly, these specialties reflect how we discuss and manage the portfolio today, dynamically balancing market conditions and mix to deliver low volatility outcomes for the total portfolio, which we are clear drives the best value creation for shareholders.

We think our financial reporting should reflect that evolution. So beginning in the fourth quarter, we expect to update our financial reporting segments to better reflect the evolution of the business and how we manage the company. Accident & Health, our largest specialty line writing over $1 billion of premium becomes a stand-alone segment. A&H is strategically important to SiriusPoint given its track record of profitability, low correlation with P&C market cycles and relatively low capital intensity. These are attributes we regularly highlight to investors and that generate significant interest. Reporting A&H separately will make its importance and performance more transparent beyond just words.

The remaining 9 specialties form a new segment called Specialty P&C. For clarity, our core result remains unchanged and is comprised of the combination of these 2 proposed segments. Both segments currently operate at combined ratios in the low 90s, and we plan to publish unaudited recast financials prior to the issuance of the Form 10-K. We will continue to provide supplementary premium growth trends on an insurance and reinsurance basis for continuity. We believe this change will demonstrate more clearly to all stakeholders how our business has changed as it is more congruent with how we manage the business internally and aligns with how we talk and describe ourselves externally. It will also help investors evaluate our performance against our U.S. specialty peers who report in a similar manner as we continue our market education on the evolution of our business. It will position us more appropriately alongside peers that better reflect our business mix, performance profile and valuation potential.

Before I hand over to Jim, let me close with some key takeaways as we reflect on our performance through the first 9 months and look to close out another strong performance year. The third quarter is yet another strong low volatility quarter operating above our return on equity guidance. Our track record continues to demonstrate the consistency and predictability between what we say and what we deliver. This matters. The continued disciplined growth of our insurance business is creating real shareholder value and our pipeline remains strong. Our capital position, balance sheet and ratings are strong, coupled with an ability to deploy capital quickly where we see opportunity.

Our LPT announcement today with respect to our runoff reserves removes the last part of our legacy portfolio and highlights unambiguously the strong performance of our core business. And finally, we are not standing still. We are not a team who are complacent in any way. Our ambition runs deep, and we are determined to continue to improve the business, providing attractive underwriting returns across the cycle and continue to compound shareholder value. Our track record on all of these points is there to be seen.

And with that, I'll pass over to Jim.

Thank you, Scott, and good morning or good afternoon, everyone. I'll provide a bit of additional detail to our third quarter and 9 months financial results, then cover underwriting, investments, capital and the balance sheet. Turning to our financial results. The quality and diversification of the portfolio Scott described are reflected in another quarter of solid operating performance. Gross written premium growth accelerated in the third quarter, driven by continued strong growth in insurance and a return to modest growth in reinsurance. Core gross written premium increased 14% to $991 million, while net written premium increased 2%, reflecting growth in lower retention lines such as Surety as well as changes in business mix.

Earned premiums increased 19%, including the impact of changes in premium earning estimates recognized in the quarter. The core combined ratio was 90.1%, resulting in underwriting income of $76 million, a 9% increase from the prior year period. The results reflect the combination of current period underwriting performance and favorable prior year development, which I'll discuss in more detail shortly. Our diversified earning engines also contributed to the quarter. Net services fee income increased 21% year-over-year to $12 million. Growth was 44% on the adjusted go-forward MGA basis. Total investment income was $69 million, including $66 million of net investment income.

Operating net income was $103 million for the third quarter. Operating earnings per diluted share were $0.88, up 19% year-over-year. As Scott noted, diluted book value per share, excluding AOCI, increased by $0.73 during the quarter to $20.21. Together, our operating performance and disciplined capital management continue to support growth in per share value. The quarter's key takeaway is that diversified underwriting, services and investment earnings translated into consistent operating performance, attractive returns and growth in shareholder value.

Turning to Slide 19. The first 9-month results reinforce the broader themes evident in the third quarter, strong underwriting profitability, growing fee-based earnings and a meaningful contribution from investments. Core gross written premium grew 7% to nearly $3 billion, with net earned premiums also growing at 7%. Our growth remaining subject to attractive underwriting conditions and our continued focus on profitability. Core underwriting income increased 22% to $202 million with the combined ratio improving 1.3 points to 90.1%. The improvement was led by reinsurance, where the combined ratio improved 4.3 points to 87.4%, benefiting from lower attritional loss experience and significantly lower catastrophe losses.

Insurance & Services underwriting income remained broadly stable, while favorable prior year development across both segments continue to support the overall result. We continue to see strong contributions from both our fee-based and investment earning engines. As a result, operating earnings per share increased 17% year-over-year to $2.29 and diluted book value per share, excluding AOCI, increased by $2.11 to $2.21. Overall, the first 9 months demonstrate the quality of our franchise reflected in strong underwriting profitability, increasing diversified earnings streams and continued growth per share value. Our strong performance and robust balance sheet provide us with substantial flexibility in how we deploy capital and maximize shareholder value.

Turning to segment performance on Slide 20. The results continue to reinforce the themes Scott and I have discussed today, growth driven by our Insurance & Services business and continued discipline in reinsurance. Gross written premium in Insurance & Services grew 20% in the third quarter, driven by Credit, Surety and increases in premium estimates or FinPro. This was partly offset by lower A&H premiums following the nonrenewal of a specific large program. We expect A&H premiums to return to low single-digit growth in the fourth quarter, while the pipeline entering 2027 remains encouraging. The segment produced a strong combined ratio of 92.8% for the quarter and 92% year-to-date.

The higher acquisition costs include profit commissions associated with favorable underwriting performance across multiple accident years. Those commissions should, therefore, be considered together with the corresponding improvement in loss experience when assessing the overall underwriting result. The combination of strong growth and underwriting performance reflects both the quality of opportunities we are pursuing and the discipline with which we are deploying capital. Reinsurance gross written premium returned to growth, increasing 3% in the quarter, while year-to-date premiums declined 6% as we maintained our focus on profitability over volume. The combined ratio improved 1.9 percentage points in the quarter and 4.3 points year-to-date, primarily due to lower catastrophe losses.

The acquisition ratio increased as favorable loss experience drove higher variable commissions and business mix shifted toward more stable structured business, partly offset by lower attritional losses. Across both segments, losses recognized to date in relation to the Middle East conflict remain limited. Overall, these results reflect the quality of the portfolio we have built with strong growth in attractive areas of the market, active portfolio management and continued discipline where risk-adjusted returns are becoming less compelling.

Circling back and double-clicking into our core specialty lines shown on Page 12. Accident & Health, our largest line at 26% of premium mix, combines attractive profitability with relatively low capital intensity. Employer stop loss continues to show signs of firming, and we remain well positioned to capitalize on improving market conditions. Within U.S. Medical excess of loss, we are seeing rate expectations in excess of 20%. As Scott mentioned earlier, we plan to update our underwriting segments in the fourth quarter. Under the contemplated structure, Accident & Health will become a stand-alone segment with our remaining 9 specialties comprising a new Specialty P&C segment.

General liability continues to benefit from disciplined pricing with rate broadly keeping pace with loss trends despite some moderation in the pace of increases. We remain selective, focusing on areas where our underwriting expertise and market positions support attractive risk-adjusted returns. Financial and professional lines remain competitive, particularly in D&O and professional liability. While market conditions are showing signs of stabilization, we continue to prioritize margin over growth. Other property remains mixed. We have reduced participation where reinsurance pricing has softened, while selectively pursuing insurance opportunities where returns remain attractive.

Surety pricing remains stable and continues to provide attractive diversification. While we are monitoring emerging loss trends, our portfolio remains differentiated with an emphasis on commercial Surety and limited exposure to larger project-related risks. In Aviation, we continue to expect double-digit rate increases for major airlines during the fourth quarter renewal season. Despite the improving rate environment, we remain disciplined in our deployment of capacity. Credit remains well priced and delivered strong growth in the quarter, supported by favorable market conditions. Within other casualty, we continue to reduce auto exposure in response to unfavorable loss cost trends, while environmental continues to deliver strong growth and performance.

Marine & Energy remains mixed. We continue to see attractive opportunities in selected energy and specialty niches, while competitive pressure persists in ports and terminals and upstream energy. Marine war pricing remains elevated amid continued regional geopolitical uncertainty. Finally, in Property Catastrophe Reinsurance, which now represents approximately 4% of the portfolio, we expect continued pricing pressure. Consistent with our strategy, we have reduced participation and reallocated capital towards more attractive opportunities across the portfolio.

Overall, market conditions vary across our specialties, but our approach remains consistent, maintain underwriting discipline, prioritize the opportunities offering the strongest risk-adjusted returns and continue improving the quality and resilience of our earnings. Looking specifically to the fourth quarter, the nonrenewal of a FinPro program, together with certain one-off premium in the prior year comparison is expected to result in Specialty P&C premiums being modestly lower year-over-year. We expect growth to resume in 2027 as these comparison effects normalize.

Turning to Slide 21. We recorded our 22nd consecutive quarter of favorable prior year development. We believe that track record is consistent with the disciplined reserving approach we have maintained while recognizing the inherent uncertainty and reserve estimates. Favorable development in the third quarter came from multiple lines of business, including Accident & Health, Energy, Credit and Property. The consistency of our reserving approach supports confidence in the quality of our balance sheet and our ability to manage capital through the cycle.

Turning to Slide 22. Our investment portfolio continues to perform as intended, providing a stable and predictable contribution to earnings alongside our underwriting and fee income. For the first 9 months, net investment income was $198 million and total investment income was $220 million. Portfolio credit quality remains unchanged. Average credit quality is AA-. Approximately 99% of the portfolio is investment grade, private credit exposure remains limited, and there were no fixed income defaults during the period. Our reinvestment rate exceeded 5% during the quarter as interest rates have risen globally. Together with strong liquidity and a short duration profile, the investment portfolio remains well positioned to support durable earnings.

Focusing on Slides 23 and 24. Our strong performance and balance sheet provide flexibility to allocate capital across attractive growth opportunities and shareholder returns. Our estimated BSCR ratio was 232%, providing a meaningful buffer against severe stress scenarios. The LPT transaction Scott mentioned earlier, further strengthens our well-capitalized balance sheet. We estimate that the LPT will increase the BSCR ratio by approximately 20 points on a pro forma basis upon close.

Touching briefly on the LPT. On a go-forward basis, we expect runoff losses to have a negligible impact. That expectation should be distinguished from the retained claims administration responsibility. The expected day 1 cost of the LPT is approximately $60 million, and the structure of the transaction provides SiriusPoint with potential future upside. We view that upfront cost in the context of the transaction's broader benefits, including reduced legacy volatility and the expected improvement in our capital position. Following $27 million of common share repurchases in the quarter, $74 million remains under our authorization.

With the announcement of the LPT, we plan to resume share repurchases while continuing to prioritize capital required to support profitable growth and maintain our strong balance sheet. We will continue to return excess capital to shareholders when appropriate. Our debt-to-capital ratio remains historically low at 23%. With $1 billion in liquidity, we have significant flexibility to fund the business, pursue market opportunities and deliver on our strategic priorities. Importantly, we continue to believe our current valuation does not fully reflect the value of our consolidated MGA platform, particularly IMG or the quality and earnings power of the broader franchise. Our focus remains on demonstrating that value through consistent execution and disciplined capital allocation.

To conclude, underwriting excellence, volatility reduction and balanced capital management continue to drive strong results. We are proud of what we have delivered in the third quarter and across the first 9 months. This quarter, we once again delivered disciplined yet attractive premium growth, strong underwriting profits at healthy margins with a continued focus on sustaining profitability, net investment income well supported by portfolio yields, returns comfortably meeting across the cycle targets and continued capital strength and balance sheet flexibility.

Subject to the customary regulatory approvals and completion, the announced LPT transaction is expected to unlock capital and further improve the group's capital flexibility. We entered the fourth quarter with a strong balance sheet and a well-positioned underwriting and investment portfolios. Building on the quality of our franchise and our track record, our priorities are to maintain underwriting discipline, complete the legacy portfolio transfer and allocate capital to compound shareholder value, supporting profitable growth and returning excess capital to shareholders when appropriate.

With that, I'll turn the call back to the operator, and we'll open the lines for questions.

[Operator Instructions] Our first question is from Michael Phillips with Oppenheimer & Co.

I guess first question on the top line on the insurance segment, the international A&H. Can you talk about that a bit? Why was it exited, the size of it? Was there any prior year development in that? You mentioned PYD as A&H. Was there any in the international? And just was it a profitability issue that you exited that business? And how big was it?

Mike, thanks for the question. Good to hear from you. Look, I wouldn't over-index, Mike, if I'm honest, in any one specific thing. I mean, look, we're always going to have accounts and relationships that we exit, et cetera. I think the overall message in A&H is it had positive PYD again, and that's a long track record of PYD that it's had. We exit relationships because for a multitude of reasons, sometimes it's performance, sometimes that they choose to exit and go other places. For us, this was a performance reason. We weren't getting the traction that we wanted on the underwriting actions. I think the thing you should take from it is the A&H segment has performed again really strongly in the quarter, really strongly year-to-date. So we've been very transparent in calling it out, but it's not really a huge deal.

Okay. A couple of questions around the LPT. The claims administration that you'll do, it looks like a mid-teens, I guess, millions of claims administrative costs. Does that feel about right for that?

Jim, do you want to give the guidance on the claims handling?

Yes, sure. In terms of -- I guess, when you say mid-teens, can you help me clarify, are you thinking from -- can you just help me clarify what you're looking at?

Yes, Jim, I'm just looking in your corporate section, if you look at the other underwriting costs, it's around $15 million, $16 million a year. Is that the right number to see?

Okay. Yes. Sorry. Yes, that's relatively the right number to consider. That is correct.

And can you talk about the tail of that? Like how long does this -- its business written before 2023? I don't know what's in that, how long...

Yes. So I would generally expect that, Mike, to amortize over roughly a 3-year period or when I say amortize, it will come down somewhat. I wouldn't say exactly linear because it follows obviously the settlement of claims, but it basically has about a 3-year -- 2.5- to 3-year tail with it. And you'll see on a year-over-year basis, I would expect that number to come down correspondingly with claims and settlements as they occur.

Okay. And maybe last one, just a little more higher level, I guess, with the recast of your segments, Scott, you've talked about the strategic value of continuing with reinsurance. And you said you'll continue to provide reinsurance. But does this recast say anything about the strategic rationale or the way you view reinsurance with your MGA business?

No, definitely not, Mike. And I'll reinforce a few really important messages. Look, we are leaning out in parts of reinsurance, which we've trailed really clearly in the first half of the year, but that shouldn't be seen as strategic that is normal cycle management for segments within reinsurance. I think we are happy to deploy capital in reinsurance where we see attractive returns and we are, and you saw that in Q3. And for us, and I've mentioned this before. We actually see the way that we approach clients and customers, for example, MGAs, it's often a blend of both reinsurance and insurance solutions. And so you should see the importance -- strategic importance of reinsurance in that regard as well. So I would not read that reinsurance in any way is not strategically important to the business. Hopefully, that answers your question?

Yes, sure does.

Our next question is from Rowland Mayor with RBC Capital Markets.

Scott, this LPT transaction sounds like it's the culmination of the underwriting turnaround, but you've also been active in cleaning up your various financing vehicles. Is there any further balance sheet optimization going forward? Or should we think about the capital decisions now as largely purely forward-looking options?

Yes. I'll pass across to Jim in a second, Rowland. There's definitely a little bit more work that we probably do in the debt stack, but Jim can explain that. But look, I think you absolutely should see the LPT as the sort of closure of the past. And as I said, for me, when I came in, we repivoted the business from an underwriting perspective. Doing an LPT on that sort of 3 years ago, Rowland wasn't really an option. We think this is an optimal time to do it. It's one of the reasons why we've been sort of trailing the information and some of the metrics like the core operating ROE. And hopefully, you can see the earnings power and potential of that business. And so for us, this allows us to close off the past from an underwriting perspective, and you should definitely see it as the closure of that.

I think it also allows us to redirect capital backing what I would call historical strategy and repoint it towards future strategy and other capital actions. So we're really pleased to get it done, Rowland. We think it's optimal at this point in our journey. And Jim, why don't I pass across to you for just some balance sheet. But there's nothing -- I would say at a high level for Jim, there's nothing significant. All the big work. Obviously, we did things like China Minsheng in our past and other bits and pieces. There's nothing of that type of significance anymore. And 99% of our efforts are in the go-forward potential of the business.

But Jim, do you want to give a bit of color?

Yes, happy to. So I would -- I think I'd break it down into a couple of components. I think when you look at our balance sheet, you're going to see that there are still some strategic minority interest MGA elements that we hold and that those are anticipated to kind of monetize at what would be their normal portfolio events. And so that will give us an opportunity as we work through there to have additional components of our funds deployed to NII, consistent NII as we go forward. Again, relatively immaterial in terms of where we started this. So think about a balance sheet that has less than kind of $100 million of it deployed relative to those activities.

As Scott indicated, the second piece that I think will be more meaningful through time is we do have the ability and we'll take that ability as we go forward to further optimize the debt stack of the company. It was put on with credit spreads in that prior to reaching kind of the financial status and the strength that we have today. And I think with the natural components as you see elements come to their natural maturity, we'll be able to take advantage of that and further optimize our balance sheet and the cost of capital that's coming through to essentially maintain more of the earnings that we generate for effectively the equity holders versus where we're paying out a higher percentage of those today from a debt perspective and an interest cost perspective.

That's very helpful. And then, Jim, I believe you said you plan to resume repurchases. So was the $27 million in the quarter impacted by the LPT? And do you still expect to complete the authorization this year?

The answer to both of those questions is yes. Whenever you have material nonpublic information and as we got to a level of kind of certainty on kind of where we're headed, that obviously plays an impact in terms of what we're able to do from a market perspective. And so that did impact our ability to execute the program in the quarter to the extent we want.

In terms of the end of the year and where we're at, we intend to effectively restart the program and would expect to at least whether it's a meaningful component or all of it to execute that component between now and the end of the year. If there's a component of it that trickles over into 1Q, that's more about market conditions and other limitations that we would have versus what do we think is an attractive place for us to be in the market from an economic perspective.

That's very helpful. And then this might just be a housekeeping item. I might have missed it, but I didn't see an expected close on the LPT. I assume it's fairly quick in the $400 million of assets transfer at close.

Yes. No, Yes. Look, we never try and forecast regulatory approval, Rowland. We're not trying to be evasive in an ideal world. We would get it done in Q4. Could it slip into Q1? Maybe we'll obviously keep you posted on that. I promise you, I don't control that part of it, but we'll do our absolute best to get it done in this year.

Our next question is from Andrew Andersen with Jefferies LLC.

You had described the '27 pipeline as encouraging. Maybe you could just talk a bit more about which businesses are contributing most to that pipeline, how you think about level of organic premium growth into next year? And I suppose I'm particularly looking at just the 9-month core GPW of about 7%, but net was down about 1%, I think, because of some new reinsurance. So maybe just some thoughts on net premium opportunities into next year.

Yes. So good question, Andrew, and thank you. Look, I think one of the things I'd say is we're right in the midst of our '27 planning. In fact, we were going through it with the Board this week. I would probably highlight our MGA Global Programs business, as having a very strong and healthy pipeline. As you know, we're very selective about who we work with and what that looks like, but we've got plenty of opportunities to work through. So we do feel encouraged by that pipeline. We don't obsess about that on a quarter-by-quarter basis. I know we have to stand in front of you guys in the market and talk about it, but we actually look at growth over a year, and we think that sort of irons out any anomalies, et cetera.

I think our A&H business, we're feeling quite upbeat going into 2027. We think we've got good opportunities driven by many of the portfolios there. IMG, we're seeing things that employer stop loss where capacity has reduced in the marketplace. I wouldn't say the market is hard or hardening, but we're starting to see green shoots in that regard. So actually, we're seeing A&H as encouraging as well. I think the market that's probably harder for us is reinsurance, where we're definitely seeing the trends that you guys are seeing right across the marketplace.

We think Property cat, which obviously is not as material for us as it was roughly 4%. We think that will be another tough set of renewals at 1/1. But we are seeing opportunities in the structured markets, which we like. We're very selective. And obviously, David Govrin and the team work them through very selectively. So we might see some opportunities, but I would highlight reinsurance as probably the area that is tougher in terms of market conditions.

And look, in terms of our London market business, we had our stamp capacity increased for, I think, either the fifth or the sixth time by Lloyd's. And so that's a continuation of a journey that we've been on for several years. The early part of that was very much remediation, Andrew, but I think we're really getting into stride now with our Lloyd's syndicate. And obviously, we're actually attracting -- as I think we touched on the last call, we're attracting individuals to SiriusPoint that we believe over time will bring good quality business to the organization. So that would be my pain picture at the moment. I'm afraid we're still in the midst of our plans, and we'll give a bit more color, Andrew, when we stand up at our full year results at the beginning of the year.

And Andrew, what I would highlight in terms of add to what Scott has indicated, the mix shift that has come across this year has led to essentially kind of that difference or it's kind of more accentuated in terms of the difference as it relates to would you expect generally the gross written premium growth to then come in on the same element from the net written premium.

So I'd say this year, there was a little bit of a normalization kind of with the changes at the earlier component of the year relative to renewal cycles, the reinsurance market and other components as we essentially pivoted more of the business towards the insurance side and what we saw were attractive opportunities within that space. So an example of that would be Surety. Surety is a line that we tend to hold a little bit less of in terms of the total amount from a -- when you're looking at just kind of what the average ratios are coming across.

And so I would just say that, that normalization has largely played out this year based on what I would expect. And then as we go into 2027, there's an opportunity there such that you'll see more of our gross premium written essentially work its way into the net written premium on a go-forward basis, again, kind of assuming that we don't see the same type of mix change that we saw this year, which is...

And Andrew, I would say that's an important principle for us that I think we've talked about in a few of our investor meetings, which is we take our time when we bring on relationships and we mature into them. And so we're always asking ourselves the question, as to whether we can take more net risk. And certainly, the answer is we can, and it's a question of timing, and that's some of the evaluation that's going on at the moment, as Jim alluded to, as we work through and finalize and sign off our '27 plan. So look, a fulsome answer, but I hope that gives you some additional color, Andrew?

Yes. And just on employer stop loss, it sounded like you're seeing rate around 20%. How does that compare with your view of underlying medical or pharmacy trends? And how could that impact kind of the combined ratio profile on employer stop-loss, but A&H more broadly?

Yes. Look, I think we're not getting ahead of ourselves with employer stop loss. So I think I would pause and say, look, I think the time to give you a further update will be our results when we give you the full year results. So we'll know a bit more by then. As I say, I'm a bit reticent to say too much because I think it's early days, but we probably feel more hopeful given some of the capacity changes in the market. And as a reminder, we've outperformed the market on a profitability perspective in employer stop loss by about 10 points. It's there for people to sort of read and see.

And we've done that because we actually didn't grow unlike others. So we -- that was a very deliberate sort of cycle management by us in employer stop loss. So we feel pretty primed if the market starts to happen. In terms of the wider A&H portfolio, I would say, Andrew, we are broadly carrying rate in line with claims inflation, and where we have to -- we're happy to lean in. There's been moments in our past where we've had to carry more rate, and we've seen examples of that, I would say, particularly post-COVID, et cetera. But I would say we're carrying rate at least in line and in some cases, slightly more than claims inflation. And obviously, the starting point of the overall A&H portfolio is one of high profitability. So those are some of the dynamics that we're seeing across our A&H book, which is also well diversified.

Our next question is from Timothy D'Agostino with B. Riley Securities.

I guess just on my end, stepping back, the business today looks more like a specialty insurer than maybe a Bermuda reinsurer. So as we think about the recast, how do you think about corporate structure going forward? And I guess one area there that I would be interested to hear about is your Bermuda domicile. Do you -- like is there benefits to potentially redomiciling? Or does that -- does it make sense to continue to be domiciled in Bermuda? Try to think how you position SiriusPoint with investors over the next few years as, again, the business just continues to look more like a specialty insurer.

Yes, Tim, listen, very good and very fair question. And I'm not going to get drawn on details and specifics. But what I would say is, obviously, we very deliberately pivoted our underwriting strategy, which is really what I'm focusing on when I say we are moving away from being a traditional Bermuda reinsurer to a specialty underwriter, and we've been doing that both in action within the company and obviously, some of the data and information that we give and present to you guys hopefully gives you the tangible evidence that we're doing that. And we think the segmental change that we're announcing today, which I should also say, Jim and the team will be as helpful as we possibly can be in Q4 and giving you as much help. We appreciate these things are -- can be an annoyance sometimes, so I promise you and the team will do everything they can to help.

But look, in terms of our legal entity structure, that's something that we'll continue to evaluate and look at over time. And obviously, all of our legal entities are really important to us, but -- and they all work incredibly hard for us. So I think if anything changes, we would obviously talk to the market, but we're happy with the structure as it stands at the moment, and it's enabling us to perform strongly as a business and grow the business, Tim.

Tim, I think the key takeaway that I would have is, and I think you're highlighting it, is the composite of the business and where we're focused is aligned with the specialty insurer, and that is what we are. Relative to the legal entity structure that supports that, I would not overly focus on whether that is U.S. or Bermuda or another. I think the key element is what is the mix of the business going on? What are the specialty underwriting capabilities that we bring to the forefront and what's the competitive advantages that we have to delivering that. And I think when you look at that across and in comparison to other specialty insurers that we're going to compare in a favorable way.

Our next question is from Gregory Peters with Raymond James.

Most of my questions have been asked. I guess you put a lot of effort into Slide 21 on your prior year development. Obviously, you're doing a lot of work with the LPT. Can you speak to where -- what pockets your favorable development, what lines of business you're getting favorable development from? It just feels like with accelerating price competition in the marketplace that the opportunities to continue to book favorable development are going to be diminishing, but maybe you have some different perspectives.

No, Greg, listen, good question. Thank you. I appreciate it. Look, I'll say a few overarching remarks and happy Jim want to come in. So let me make a couple of points here, Greg, which I think are really important. One is we manage our reserves and balance sheet prudently, and we're very deliberate about that. And I think we've talked about it on these calls before. I want to give you a very clear example. So in some of our MGAs, particularly our newer relationships, we actually reserve above our price loss ratio. So inherently, we carry reserves in excess of what our pricing is. And so we do that very deliberately because we want to be cautious. We want to make sure that if there's any bumps as we go through and mature those relationships that we've got adequate reserves to cover them.

And therefore, I do think that you should see the PYD track record has been linked to some of those actions. So that's the first thing I'd say. Second thing I'd highlight and both Jim and I touched on it, which is the LPT transaction and the removal of those reserves and the uncertainty associated with them actually improves the strength of our reserves. So we see that as additive and a tailwind as opposed to a headwind. And so look, nothing is going to change in terms of our reserving approach. even with tougher market conditions. And as I say, I think a 22-quarter track record is something that we can point to and say isn't an accident. It's a fundamental way that we manage the company and the way that we manage the balance sheet.

But Jim, anything you want to add to that?

Yes. So just a couple of things that I would highlight. One, I 100% agree with you when we double down. We have a very prudent approach, we think, in terms of how we establish our reserve position, which starts with a prudent pricing position. And then depending on risk, time, other components, it either gets basically 1 additional kind of reserve load or 2. And that is a meaningful element, and it's an amount that we hold until and up through the points that we kind of hit the top end of the confidence intervals that we see from a U.S. accounting and other perspective that's appropriate.

The second element to answer your question more directly in terms of the areas of that, I would say, in general, we're seeing it favorable development across the portfolio. And so I think that's as much about kind of the reserving philosophy that we have and that we try to be prudent and thoughtful, not just in terms of what the total number is, but at a reserving class level, we try to be very thoughtful there as well. And that is really playing out across the portfolio and gives us a really strong balance sheet.

We have reached the end of the question-and-answer session. I would like to turn the floor back over to Scott Egan for closing comments.

Super. Thank you very much, operator. Just really a quick wrap-up for me. Look, thank you, as always, for your questions. Thank you for joining the call. I'd probably end with 4 key takeaways. One, we believe Q3 is again strong evidence of our low volatility, high-performing approach to our underwriting discipline. And I think the numbers and the evidence I hope speaks for itself. The second thing today is the LPT, which we've touched on throughout the questions. It really does for us, close off the past and I hope emphasizes the strong performance of our go-forward book and a particular core operating ROE.

Our balance sheet, which we've touched on with some of the questions, is strong. And I believe after the LPT even stronger and really well positioned both in terms of strength and agility to take advantage of the opportunities. And we look forward as a team to ending the year strongly and updating you at our full year results. And with that, I'd like to thank you very much for joining and appreciate all your questions and support. Thank you.

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

Good morning, ladies and gentlemen, and welcome to the SiriusPoint Second Quarter 2026 Earnings Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded, and a replay is available through 11:59 p.m. Eastern Time on August 13, 2025.

With that, I'd like to turn the call over to Liam Blackledge, Investor Relations and Strategy Manager. Thank you. Please go ahead.

Good morning, and thank you for joining us for SiriusPoint's Second Quarter and Half Year 2026 Earnings Call. Last night, we released our earnings press release, Form 10-Q and financial supplement, all available on our website at investors.siriuspt.com, along with the slides that will accompany today's discussion. Joining me on the call are Scott Egan, our Chief Executive Officer; and Jim McKinney, our Chief Financial Officer.

Before we begin, I'd like to remind you that today's remarks contain forward-looking statements based on current expectations, and actual results may differ materially. We will also reference certain non-GAAP financial measures, which we believe are useful in evaluating the performance of the business. Reconciliations can be found in the presentation and our SEC filings. Please refer to our earnings release and accompanying material for a more complete discussion of forward-looking statements and non-GAAP measures.

With that, I'll turn the call over to Scott.

Thanks, Liam, and welcome, everyone, to our second quarter and half year results call. SiriusPoint delivered another quarter of consistent and strong underwriting profitability. We continue to demonstrate the durability of our performance, which is especially important as more markets become tougher. We firmly believe delivering a strong return on equity year in, year out is key to creating long-term shareholder value. And this is why over the last three years, we've deliberately taken actions to diversify the book and reduce our volatility.

We are well positioned for cycle resilience and to deliver on our across the cycle 12% to 15% return on equity target, and our half year results for 2026 are another proof point that our strategy is delivering against that aim.

Our headlines at the half year are clear. The business continues to perform strongly. We are growing where we create the most value and where we see attractive returns for the risk we take. Our approach and growing reputation means our growth pipeline remains strong. And finally, our balance sheet and agile capital management serve as the bedrock to maximizing business opportunities.

Jim will take you through the details of the second quarter shortly, but we delivered a core combined ratio of 91.4% and an operating return on equity of 13.8%. This means that at half year, our net income is up 44% over the prior year and our operating ROE of 14.7% is at the upper end of our 12% to 15% target range.

Our core result, which excludes our runoff business, continues to outperform and delivered a 16.2% return on equity, which is above our target range. Our book value continues to grow. Book value per diluted common share, excluding AOCI, increased 3% in the quarter and 8% year-to-date. And we've repurchased $95 million of common shares year-to-date, bringing total capital return to shareholders in 2026 of $295 million, including the preference share redemption in February.

Our value creation continues to be driven by our earnings growth, reflecting the quality, discipline and durability of our operating model. We are driving the company to be a focused specialty underwriter underpinned by a diversified and lower volatility portfolio, which is meaningfully more balanced than it was several years ago. A key example of this is the growth of our Accident & Health business to around $1 billion, given its strategic importance as a consistently profitable and low volatility business with a low correlation to wider P&C pricing cycles. The combination of our insurance and services and reinsurance businesses, coupled with our 10 different specialty lines and our multiple distribution channels act as good diversification, supporting more stable earnings and a resilient capital profile.

Turning to Slide 8. The quarter once again demonstrated both our underwriting discipline with a low 90s combined ratio and our ability to grow. Our Insurance and Services gross written premium grew 15%, while our reinsurance premium declined 9%. We will be disciplined in areas where pricing or risk-adjusted returns do not meet our thresholds. We have the ability to redirect our capital quickly to other more attractive lines, segments and geographies.

Slide 11 shows the scale and breadth of our growing specialty platform and our active management of the various pricing cycles. We have meaningful positions across many lines. To reiterate, underwriting discipline is key to how we manage the business. We will not pursue growth at any cost. And this quarter, we have added some additional detail to the slide on trailing growth trends.

As you can see, we are growing strongly in areas where we have previously said pricing is more attractive, such as accident and health and surety and pulling back in areas where pricing is more competitive like aviation, property cat and certain segments of casualty. Jim will cover each of our specialties in more detail, but this slide shows how we are building in specialty lines where we have underwriting expertise, relevant distribution and the ability to generate attractive returns.

As the portfolio evolves driven by our underwriting focus, the shift in our business mix has affected the timing of our earned premium recognition, meaning premiums are earning through more slowly. You can see that in some of the numbers this quarter, and Jim will unpack this later in the call.

Turning to underwriting performance briefly on Slide 12. This shows exactly the type of business portfolio we are building. This is now consistently delivering strong combined ratios and lower volatility, and our volatility profile continues to be favorable against our U.S. specialty peers and of course, is very different to that of the largely reinsurance-focused Bermuda domiciled peers. This is obviously very different to our past.

Slide 13 shows our disciplined approach to partnering with specialist MGAs. We've reinforced this many times during these calls before. But given their importance to us and our strong performance, it is worth reiterating. The headlines are we are highly selective in choosing partners declining more than 90% of opportunities. We take our time getting to know potential partners before onboarding. Once we enter a relationship, we deliberately start conservatively in our net positions, growth and reserving. Importantly, incentives are aligned with underwriting profitability and not premium growth. You can see this in our acquisition ratio as profitability improves. This is a dynamic we are very happy with.

The result is a portfolio built around long-term relationships with strong renewal rates and with a significant portion of premiums coming from partners we have worked with for many years. We believe our differentiated approach to this distribution channel is the key to our success and earnings power.

Turning to our people. As you know, at SiriusPoint, we put a lot of emphasis on our culture. Once a year, we run an employee engagement survey, which gives us a real benchmark on how we are doing with the most important asset in our business, our staff. Our approach to everything we do is that it starts with having the right people, the right culture and the right mindset. And I believe this has been the most important ingredient of our success over the past three years.

The highlights of this year's survey are seen on Slide 14. Our overall employee engagement score is now at 83, increasing for the third consecutive year. Our scores across leadership, organizational alignment, collaboration, development, recognition and pride our top quartile scores. And finally, our NPS score of plus 40 is well above industry benchmarks and once again increased double digit year-on-year. I see a direct link between these scores and the business performance we are driving. It is the cornerstone of long-term sustainable performance. I'm incredibly proud of and grateful to all of my colleagues and what they do every single day. They are our secret sauce.

Before I pass across to Jim, I'll end with some key takeaways as we head into the second half of 2026. Our business has delivered another strong half year of performance, operating at the upper end of our return on equity guidance. Our track record shows the consistency and predictability of what we are saying and doing. This matters.

The continued growth of our insurance business is creating real shareholder value and our pipeline is strong. Our capital and balance sheet are very strong as demonstrated by the ratings upgrades to A by S&P, Fitch and A.M. Best earlier this year. And our aim is to continue to improve.

So to end with the World Cup theme of the past few months for all new soccer lovers, it's half time in the SiriusPoint 2026 Match, a strong performance in the first half by the team, all to play for in the second half, and the team is ready, able and hungry for success, and I look forward to providing you with our next update at the third quarter hydration date. So with that, I'll turn it over to Jim to walk you through the match stats for the first half. Jim?

Scott, I expected you to call it football, but glad to see you are coming around and calling in soccer. Anyway, good morning or good afternoon, everyone. I'll provide a bit of additional detail to our second quarter and half year results, then cover underwriting, investments, capital and the balance sheet.

Turning to our financial results. The strength and consistency of the portfolio Scott just described translated into another quarter of solid operating performance. Core gross written premium increased 6% to $982 million, reflecting continued growth in our insurance and services business, while net written premium grew 1% as we maintained our disciplined underwriting approach.

Underwriting performance remained strong with a combined ratio of 91.4% and underwriting income of $55 million. While this compares to an exceptionally strong prior year quarter, it remains fully consistent with our across-the-cycle profitability objectives. As Scott noted earlier, changes in our portfolio mix during the first half of the year extended the earning pattern of our unearned premium, reducing earned premium recognized in the quarter by approximately 10% or $31 million. This shift reflects growth in longer duration lines such as surety, combined with reduced exposure to shorter-tail property catastrophe business.

Importantly, this is a timing impact rather than an economic one, creating a favorable earned premium tailwind that will benefit future periods. The earnings profile continues to benefit from diversification across underwriting, fee income and investment. Net service fee income increased 15% year-over-year to $10 million or 41% adjusting for go-forward MGAs and total investment income remained strong at $73 million, including $66 million of net investment income. These results produced operating net income of $79 million or $0.67 per diluted share, unchanged from the prior year despite a more competitive market environment.

Importantly, we continue to grow intrinsic value during the quarter with diluted book value per share, excluding AOCI, increasing $0.50 to $19.48. Overall, the quarter reflects the quality of our underwriting portfolio, the growing contribution from fee-based earnings and the resilience of our balance sheet and investment portfolio. The key takeaway is that we continue to deliver consistent operating earnings and book value growth while maintaining underwriting discipline and a strong capital position.

The strength of our portfolio is translating into consistent financial performance. For the first half of the year, core gross written premium grew 3% to nearly $2 billion, while actions to improve portfolio quality and reduce volatility contributed to a 2.3 point improvement in the combined ratio to 90.1%. That drove a 31% increase in underwriting income to $126 million, while strong investment performance and growth in fee income further diversified earnings. As a result, operating earnings per share increased 17% year-over-year to $1.37 and diluted book value per share, excluding AOCI, increased $1.38 to $19.48.

Overall, the first half demonstrates that our strategy is delivering the outcomes we set out to achieve, strong underwriting profitability, growing earnings diversification and continued growth in intrinsic value per share. The combination of strong earnings generation, book value growth and a resilient balance sheet continues to provide significant flexibility in how we deploy capital for shareholders.

Turning to segment performance. The results reinforce the themes Scott and I have discussed today, disciplined growth in Insurance and Services and continued portfolio optimization in reinsurance. In Insurance and Services, gross written premium grew 15% in the quarter and 11% year-to-date, driven by areas where we see attractive risk-adjusted returns. Despite that growth, the combined ratio remained strong at 90.7% for the quarter and 91.4% year-to-date, reflecting disciplined underwriting and favorable prior year development.

In reinsurance, we continue to prioritize profitability over volume. Gross written premium declined as a result of intentional portfolio actions, while the combined ratio improved 5.2 points year-to-date to 88.3%, driven largely by lower catastrophe losses and an improved portfolio quality.

Expense ratios remain disciplined across both segments. The modest increase in acquisition ratio reflects higher profit commissions on the prior year business, consistent with favorable reserve development. The OUE ratio was impacted by the timing shift in earned premium recognition discussed earlier. Despite this, we remain on track to deliver a full year OUE ratio of approximately 7% at the upper end of our guidance range.

Overall, these results demonstrate the benefits of our strategy, growing where returns are attractive, reducing exposures where they are not and consistently improving the quality of earnings across the portfolio.

Circling back and double-clicking into our core specialty lines shown on Page 11. Accident & Health, our largest line at 27% of premium, remains highly attractive business, combining strong profitability with low capital intensity. Employer stop loss continues to show signs of firming, and we remain well positioned to capitalize on improving market conditions.

General liability pricing remains broadly aligned with loss trends, although rate momentum has moderated. We continue to focus on segments where underwriting discipline supports attractive returns.

Other property conditions remain mixed. We have reduced participation where reinsurance pricing has softened, while continuing to grow selectively in property insurance niches offering attractive economics. Financial and professional lines remain competitive, particularly in D&O and professional liability. While market conditions are stabilizing, we remain cautious and highly selective, prioritizing margin over growth.

Within other casualty, we continue to reduce auto exposure given unfavorable loss cost trends while benefiting from strong growth and performance in environmental. Surety remains an attractive diversifying line. While we are monitoring emerging loss trends across the market, our portfolio remains differentiated with a focus on commercial surety and limited exposure to larger project-related risks.

Aviation remains disciplined with expectations for continued rate improvement in major airline business later this year. Credit remains well priced and delivered strong growth in the quarter, supported by favorable market conditions. Marine and Energy presents a mixed environment with attractive opportunities in selected energy and specialty niches, offset by continued competitive pressure in cargo, haul and upstream energy.

Finally, property catastrophe reinsurance, now approximately 4% of the portfolio, experienced further rate pressure at midyear renewals. Consistent with our strategy, we reduced participation and allowed premium volumes to decline, prioritizing profitability and capital efficiency over top line growth. Overall, market conditions continue to vary by class, but our approach remains unchanged, deploy capital where risk-adjusted returns are strongest, maintain underwriting discipline and continue improving the quality and resilience of earnings.

Turning to Slide 20. Another important indicator of portfolio quality is our reserve performance and consistency of prior year development. We recorded our 21st consecutive quarter of favorable prior year development, supported by disciplined reserving process, prudent reserve setting on new business and meaningful protection from our LPT structures. This consistent track record is another example of the underwriting and risk management discipline that underpins our earnings and book value growth.

Turning to Slide 21. Our investment portfolio continues to provide a stable and predictable earnings stream that complements our underwriting results. In the first half, net investment income was $132 million and total investment income was $151 million. The portfolio remains conservatively positioned with a AA- average credit quality, approximately 99% investment-grade exposure, limited private credit exposure and no fixed income defaults during the period. Combined with strong liquidity and a short duration profile, the investment portfolio remains well positioned to support earnings consistency and balance sheet strength.

Turning to financial strength and capital position on Slides 22 and 23. Our capital position, leverage profile and liquidity continue to provide significant flexibility to execute our strategy and create shareholder value. Our estimated DSCR ratio remains strong at 239%, reflecting a well-capitalized balance sheet while maintaining resilience in severe stress scenarios.

At current trading levels, we continue to view share repurchases as an attractive capital allocation opportunity, offering compelling returns and payback economics. We've repurchased $95 million of common shares year-to-date and have $79 million remaining under our authorization. We continue to manage the business within a capital framework aligned with S&P's AAA capital model assumptions, underscoring our commitment to balance sheet strength.

Our debt to capital of 22.9% is near the lowest level in several years, providing additional financial flexibility. Liquidity remains robust at $1.1 billion, giving us ample capacity to support the business, pursue strategic opportunities and navigate market volatility. Importantly, we continue to believe our current valuation does not fully reflect the value of our MGA platform, particularly IMG, nor the quality and earnings power of the broader franchise.

In conclusion, we are proud of our results for the second quarter and half year. Our strategy predicated on underwriting excellence, volatility reduction and balanced capital management continues to yield strong results. The quarter saw us deliver strong underwriting profits, continued attritional loss ratio improvement, net investment income well supported by portfolio yields, returns comfortably within our across-the-cycle targets and continued capital strength and balance sheet flexibility. We have made exceptional progress in becoming a best-in-class specialty underwriter, though there is still room to improve, and that is what the second half of the year is for.

With that, I'll turn the call back to the operator, and we'll open the line for questions.

[Operator Instructions] Our first question today is coming from Michael Phillips of Oppenheimer.

I want to -- I guess, first off, just all about timing, right? Tough data to report given the broader market and what's happening in insurance today, but we'll get past that. I guess I want to start with your comments on the insurance growth in one piece, the other property segment, it's one of your top three lines. And Jim, you said it's mix, right? So can you just maybe help define specifically or give some examples of your book in other property and pieces of that, that you think are more attractive than others so we can kind of frame what that could look like over the next year?

Yes. Mike, it's Scott. As always, thank you for your questions. Thanks for dialing in. Look, for us, obviously, we always talk about the property cat market when we -- in general terms, when we talk about the unattractiveness. But actually, we have some quite strong property programs in our program MGA space. These tend to be more niche in a sense. So we have programs both in U.K., Europe and in North America. Examples might be landlords, examples might be SME businesses in the U.K. So they tend to be more niche products.

And actually, we're happy Mike, with the environment that we're seeing in them, both in terms of performance of the actual schemes and also the rate that we're carrying. Of course, we never fall asleep and we're always alert. But the dynamics that we're seeing in those type of markets is actually quite different to what I would call the kind of broader general property markets and property cat markets, if that helps answer your question.

Yes, it does. It does. And thanks for addressing that because it's simply people think of property right now, and it's under a lot of pressure. But clearly, there's some spaces in your...

Yes. And Mike, maybe I can make a general point here. And sorry, I know I interrupted you there. I should have said it when I answered your question, which is, look, I think one of the things that our MGA program distribution focus allows us is often to partner with sort of specialists in niche spaces. It's one of the things that we really like.

And therefore, we get access to niche markets, but we also partner with really specialist underwriters who understand that space. And so it's a really sort of two-pronged answer in a sense, which is it also talks to our focus and strategic focus in MGA and programs as well and why we find that attractive.

Yes. And I would just add one element to clarification or enhancement. I think when the market is referencing property in total, many times, Mike, I think they're referencing the property cat market as they go versus the attritional property market. And those at times can have very different trends, as you know and as others know.

Scott, I appreciate that. Let me turn to IMG for a second. You've done some deals recently there. And I guess just more broadly, longer term, does that MGA book currently have as diversified of a book as you wanted to have? Or should we think there could be more to come from what you've done recently with, say, Assist America and World Nomads?

Yes. Look, I think the IMG business is an interesting one. Mike, I would say we've definitely improved the diversification over the last three years. We've introduced some new products. And actually, we're introducing subproducts as we speak underneath those tiered products, et cetera. We've also diversified our distribution to market. So our direct-to-consumer in IMG now makes up roughly about 1/3 of our distribution, whereas a few years ago when I arrived, it was heavy, heavy and predominantly via aggregators and brokers, et cetera.

So we are diversifying the business. We are diversifying the product set. We are diversifying routes to market. There's nothing imminent on the horizon. And I do -- I'll never rule it out if there's something that fitted well with our skill set, with our underwriting skill set and our platform, then we'd look at it.

But I think something like Assist America and World Nomads, we're really building on products that we had and customers that we had, albeit in slightly different geographies. But look, ultimately, World Nomads is a great example where it's a sort of subspecialism within the product. And I sometimes think, Mike, that's a really smart way of sticking to what you know, but getting access to different segments within the marketplaces.

So look, we're quite excited with where IMG is going. We're quite excited by the products that it has, and we're quite excited by the bolt-on acquisitions that we've done, if that answers your question.

It does. I guess maybe a follow-up there, Scott, would be we've seen in the last couple of quarters, the margin on that business kind of tick up a bit, and you called out this quarter Assist America. I wonder, is there more to come? It should -- or are we hitting that mid-teens margin is kind of the ceiling for a margin in the business -- given the recent deals that you've done?

Yes. I mean, just to be clear, World Nomads is not yet in our numbers, Mike. So that's still got to come through. And I think the strategic focus in IMG is to continue to grow our direct-to-consumer business. That's not always easy. But obviously, inorganic and organic are tools that we can deploy.

I think what is true is that if we grow our direct-to-consumer business, the margin on that product or on that distribution channel, should I say, is higher than via other routes. But obviously, there is an offsetting expense where ultimately, we have to market the brand. And so one of the questions we're asking ourselves perhaps for the plans next year and beyond is should we be doing more to perhaps invest in the brands that we have with a view of growing that distribution channel. But ultimately, the economics of that are attractive.

The next question is coming from Timothy D'Agostino of B. Riley Securities.

Just one from my end. And within the past month or so, you launched the Fine Art and the Crisis Solutions offerings. I guess, can you just provide some color on why now is the time to do that? What you're seeing there and how it fits the SiriusPoint model?

Yes. No, good question, Tim, and thanks again for joining. So maybe if I go back a step, Tim. So I think we've always been very clear that the London market fits very well with our strategy of specialisms. For the first few years that I was here, certainly, we were investing in some of our sort of processes, underlying infrastructure, capabilities, et cetera. Earlier on this year, we sort of broke it out as one of our sort of stand-alone P&Ls and David Govrin within our business took over the leadership of that.

And for us, what we're looking to do is develop teams and develop products within that business. And these are two areas, PVT, which we've actually labeled Crisis Solutions. That's the brand we've given that. I think it's actually a better -- quite frankly, it's a better badge than PVT, sounds like medicine. And Fine Art and Specie is areas that we think are attractive in the market and where we can make money. And we've actually gone out and attracted some of the best talent in the London market.

And honestly, Tim, been very humble about it three years ago, we would not have been able to do that. And so we're really excited that the platform we've created, the leadership that we put there and our sort of growing reputation means that we're able to attract people with really good, strong underwriting skills in niche markets in London that we find attractive.

The next question is coming from Andrew Anderson of Jefferies.

This is Charlie on for Andrew. The first question I have is just on the casualty side. When you guys are kind of looking at reserve adequacy, where are you more focused today? Is it on social inflation, claims emergence, severity trends, litigation funding? I guess, where are you seeing the most cause for concern and scrutiny?

No, good question. I mean I would say -- and maybe I think about it a little differently than any of the individual elements that you said because I guess we focus on all of them when we come back to it. As I think prudent reservers, I think we always take a skeptical eye as well to each of the underlying environmental components. We probably lean forward as a whole from a risk perspective, if you will, being a little bit more skeptical than where the market would probably be on each of those elements, but that's a hard thing to exactly measure because there's a bunch of different ways to kind of look at that.

What I would point you to is essentially the 21 consecutive quarters of favorable prior year development and our overarching reserving philosophy, which is to be prudently and thoughtfully reserved at a class level, at an individual level and most importantly, the portfolio overall.

And there's been no change in any of our kind of thought processes against that. And we continue to kind of see the environment lining up relative to our expectations. And if something changes there, we're going to appropriately and consistently have that skeptism that we've had, and you'll see us react to that. But we're starting with that. So I think we feel pretty good. And I think we've demonstrated a really good track record of being thoughtful in navigating environments in a good way.

Okay. Yes, fair. And then the second question I have is on the property side. So we've had a pretty quiet wind season so far, obviously, far from the end of wind season. But assuming that there are no major industry loss events through year-end, how would you guys think January 1 property reinsurance renewals should develop? And then assuming that we see another year of significant pricing declines, how would that kind of shift your perspective on capital deployment between property versus casualty or certain lines of business within those on the back end?

So Charlie, I'm afraid I don't have my weather crystal ball, right? So I do hope for a quiet wind season, but I must admit, if you've been in Bermuda for the last few days, you wouldn't be feeling hopeful it's been awful. Look, for us, the market is important, but relative to our overall business, small, I think Jim talked about it earlier on, it's 4%. And so for us, it's not really the bellwether of the group, if you like.

On a personal level, I think if there's no activity, I think it will just put further pressure on pricing. I think there is momentum in the market that is driving rate down. We saw that at midyear -- we saw at 1/1 and then we saw it at midyear again. That's one of the reasons why our reinsurance is down at the half year.

Equally, I think we should balance that up. We still do have really strong property cat book. We've got clients that have been with us a long time, and we've renewed many of those clients, but there are some individual risks and individual areas that we're just not seeing the rate adequacy on. So we're not frightened to walk away.

So look, in truth, if it's a quiet wind season, I think I'm afraid it would probably put more pressure on the rates. I can't see that reversing. But luckily for us, we've got a very well-diversified book, lots of different specialisms and property cat is such a small part of it now that we believe we can still drive strong earnings performance regardless.

Yes. And Charlie, I would add on to what Scott has kind of said. And I don't think the trade is purely between property cat and casualty and how we balance the book. You've seen us growing strongly through A&H, through surety, credit. We're looking at where the best return on capital is across the market and where we can essentially create significant value, both immediately and through time. And so we have a bunch of options on that, and it's really going to be about the risk-adjusted return on capital for us as a business that would direct those activities, and there's a bunch of different avenues that we have to deploy capital and to do that really thoughtfully that's inside our core specialty capabilities.

The next question is coming from Mitchell Rubin of Raymond James.

This is Mitch on for Greg Peters. We're hearing rhetoric about MGA price competition intensifying. And I appreciate the commentary around your selective onboarding process and specialty niches. Is elevated competition showing up at all in the loss assumptions you're building into new business?

Mitch, it's an interesting one. Look, MGAs operate in markets. They don't operate in vacuums. So of course, they're not protected from what I would term wider pricing pressures. I do think though, when you think of MGAs and certainly many that we work with, customers approach them because of their deep expertise and specialisms that they buy in terms of understanding their risk. And whilst I don't think that removes the sort of pricing elasticity, I do think that customers or end customers are prepared to pay for that expertise.

And so for us, when we look at our relationships with that, we can see that. We can see some of the general market rating pressure. But what I would say, if you look at our insurance business, it's growing very strongly. A large engine of that growth is our MGA and program business. And I would say, in general, we are happy with our partners and the rate adequacy across many and most of our schemes.

The one I would highlight, which is a more difficult marketplace in general, including through our MGA who we partner with is aviation, where we highlighted at the end of last year where we had to take significant pricing action, and that was on the back of loss trends. I would say in the first half of the year, those loss trends have continued.

And therefore, I think when it comes to Q3, Q4, which is the sort of major airline renewal season, I think that needs significant rate action to make sure that the risk is matched with price. So I would highlight that one as one that stands out. But the rest, I would say, in general terms, we are happy.

And if we're not happy, then we will either take action, which was Jim's point earlier on, or occasionally, we will close down a partnership. I would -- like to say that, that though is the minority, and we don't often see that. I think examples of that just to be balanced, our commercial auto, where we've just lost our appetite for the market. We've announced that before and said it in our previous calls. So look, I'm trying to give you a balanced perspective, Mitch, in terms of the question that you asked.

And just adding on, Mitch, to some of the comments that Scott had made is I would just add to that, that our variable commission structures and that, that we put in place, while we're willing to trade a little bit of upside, provide downside protection from a loss ratio perspective as well. And so when you think about it, you can't just focus on one line. You got to think about the sum total that comes together that helps us achieve or achieve our targeted risk-adjusted return on capital.

Got it. I appreciate all the color on that. As a follow-up, so across the industry, peers are leaning heavily into AI and underwriting and expense efficiency, but it hasn't seemed like as much of a point of emphasis for you. Can you provide some perspective on how you're thinking about AI and technology in your operations?

Yes, very timely question, Mitch. Actually, we had our Board meetings in Bermuda this week, and we always, on an annual basis, have a sort of strategy check-in with the Board and AI was one of those topics. We are doing quite a lot across the organization in terms of and Mike was asking questions in IMG, et cetera, earlier on. We've got AI work going on in IMG, but we've also got it going on across the wider business, helping us understand risk understanding, helping us manipulate data, helping us with contracts, et cetera.

So we've got lots of use cases, tens and tens and tens of use cases. Some of those will work and some of those won't work. But I would say we are now into the swing within the organization of creating both a framework and an infrastructure, and we are investing in AI. And I think for all organizations, you have to be prepared for some of them to work and not work. What I would say is I've not seen anything that fundamentally shifts the operating model of a company in our sector yet.

But I see lots and lots of examples where AI can help us be both a better underwriter. I think it can help us be more efficient. And so therefore, it has multiple, multiple uses. And we shouldn't just concentrate on the efficiency lever because I actually think one of the most powerful parts of AI is both speed and also quality of underwriting. So look, I hope that gives you a bit more color, Mitch, and that was certainly the discussion we had with our Board this week.

And I think adding to that, it...

[Operator Instructions] Our next question is coming from Matt Palazola of Bloomberg Intelligence.

This is just more of a modeling one. Sorry if I missed this, but you had mentioned that the slowdown in earned premium growth and then some potential pickup. Is that expected to be a sharp thing in maybe the third quarter? Or would the pickup be more extended throughout and go into 2027?

Yes. So the pickup will be extended throughout '26. You'll see incremental increases throughout each of the next quarters from a baseline perspective, but there'll also be a little bit of impact relative to that mix that goes through there. And in short, we're basically starting the first quarter of 2027 in a stronger position than we otherwise would because the remaining tail of that earnings from the extension comes through in that first quarter. So basically, it's a 3-quarter element as it will work our way into our business.

Okay. And then I just want to ask about cyber. I mean, is that -- I assume it's a small part of the business. And given recent events with kind of AI going rogue, does that change the way you think about that business or the attractiveness of it at all?

Yes. Matt, cyber makes up a very small proportion of our portfolio. That said, I don't think it's something that any insurer can ignore. It's a risk that customers want to ensure. We're very thoughtful, very cautious about it. And the example you gave is the reason why we're very thoughtful and very cautious about it.

Thank you. At this time, I'd like to turn the floor back over to Mr. Egan for closing comments.

Superb. Listen, thank you very much. We do appreciate you dialing into the call. We know this is a busy time of the month for you guys. Look, end with just a couple of closing remarks. Look, my view is our first half year has been another half of strong performance at the top end of our return on equity guidance and actually for our core go-forward business above that.

I think what's really, really important for us is the consistency and the predictability of our earnings, and I hope you're seeing that come through on a continued basis. The growth that we're seeing in our insurance business is very deliberate. And so we go into the second half of the year, both aiming to improve, but also upbeat about our second half expectations, and we look forward to speaking to you again at Q3. Thank you very much.

Thank you. Ladies and gentlemen, this concludes today's event. You may disconnect your lines or log off the webcast at this time, and enjoy the rest of your day.

[Audio Gap]

2026 Annual General Meeting of Shareholders of SiriusPoint Limited. Please note that today's meeting is being recorded. It is now my pleasure to turn today's meeting over to Bronik Masojada, Chairman of the Board of Directors of SiriusPoint Limited. Mr. Masojada, the floor is yours.

Thank you. Good morning, ladies and gentlemen. I'd like to call the meeting to order this morning at 10:00 a.m. Atlantic Daylight Time. On behalf of the Board of Directors, I am pleased to welcome you to the 2026 Annual General Meeting of the Shareholders of SiriusPoint Limited. My name is Bronik Masojada, and I'm the Chairman of the Board of Directors of SiriusPoint. It is my pleasure to serve as Chair of today's meeting. I am pleased to welcome my fellow members of the SiriusPoint Board of Directors. Scott Egan, Director and Chief Executive Officer; Susan Cross, Director and Chair of the Governance and Nominating Committee; Martin Hudson, Director; Dan Loeb, Director; Sharon Ludlow, Director and Chair of the Audit Committee; Mehdi Mahmud, Director and Chair of the Investment Committee; Franklin Montross IV, Director and Chair of the Risk Management Committee; Sabra Purtill, Director; Jason Robart, Director and Chair of the Compensation Committee; and Peter Tan, Director.

I'm also pleased to welcome several members of SiriusPoint Limited executive management team who are with us today. James McKinney, Chief Financial Officer; and Linda Lin, Chief Legal Officer and Corporate Secretary, who will act as Secretary of today's meeting. In addition, I would like to welcome Harold Murphy of Computershare, who will serve as the Inspector of Election for this meeting and has taken the requisite oath of office.

Finally, I'm pleased to welcome Phil Gordon and Tom Kim of PricewaterhouseCoopers LLP, our independent registered public accounting firm. Each of you has access to the agenda for this meeting as well as the rules of conduct for the Annual General Meeting, which are available in the Documents tab of the virtual meeting site. As set forth in the rules of conduct, the company will address shareholder questions to the extent they relate to the proposals being presented at this meeting.

If you have any questions on the proposals, please submit them by clicking on the Q&A tab at the top of the virtual meeting site, entering your name, contact information and question in the field provided and then clicking on the send button. We will now proceed to the formal matters of establishing a quorum and confirming proof of proper notice of the meeting. Secretary?

This meeting was properly called pursuant to the Companies Act 1981 and the company's bylaws. I have received an affidavit of mailing establishing that notice of this meeting was duly given on or about April 10, 2026. A copy of the notice of meeting and the affidavit of mailing will be incorporated into the minutes of this meeting. All shareholders of record at the close of business on March 30, 2026, are entitled to vote at this Annual General Meeting.

Thank you. Our first order of business at this meeting is to determine whether the shares represented at the meeting, either in person or by proxy, are sufficient to constitute a quorum for the transaction of business. Ms. Lin, please provide the results and shareholder report from our transfer agent, Computershare.

Sure. The shareholder report shows that as of March 30, 2026, the record date, there are 1 million 116 -- 116,104,912 common shares and 9,713 Series A preference shares outstanding and entitled to vote at this meeting. Approximately 93% of all the shares entitled to vote at this meeting are represented in person or by proxy.

Thank you. Because shareholders entitled to cast a majority of all the votes entitled to be cast at this meeting are present in person or by proxy, I declare that a quorum is present and that this meeting is duly convened for the purpose of transacting such business as may properly come before it. Before proceeding further, we will pause briefly to allow for any questions from shareholders. There being no questions, we will proceed with the business of the meeting. I will now turn to the voting portion of this meeting and declare the polls open. Ms. Lin, please present the matters to be voted upon.

Proposal #1. The first proposal before the shareholders is the election of 2 Class I directors to serve 3-year terms expiring in 2029. The Board of Directors of the company has nominated and recommends that shareholders vote for each of the following Class I director nominees, including Susan Cross and Sabra Purtill.

The second proposal before the shareholders is the approval by a nonbinding advisory vote of the executive compensation payable to the company's named executive officers as described in the proxy statement. The Board of Directors of the company recommends that the shareholders vote for this proposal.

The third proposal before the shareholders is the approval of the appointment of PricewaterhouseCoopers LLP to serve as the company's independent auditor until the Annual General Meeting to be held in 2027 and to authorize the Board of Directors acting through its Audit Committee to determine the remuneration of PricewaterhouseCoopers LLP. The Board of Directors of the company recommends that the shareholders vote for this proposal.

The fourth proposal before the shareholders is the approval of the SiriusPoint share plan. The Board of Directors of the company recommends that shareholders vote for the SiriusPoint share plan. We will now proceed to voting on the proposals.

Thank you. If you have not previously submitted your proxy or wish to vote electronically, please cast your vote electronically at this time. If you have already voted by proxy, you need not vote today unless you wish to change your vote.

[Voting]

We have now received all proxies and as all shareholders wishing to vote have had the opportunity to do so, I hereby declare the polls closed. I will now ask the Inspector of Election to confirm that the ballots have been counted.

Since the inspector of election has confirmed that the votes have been tabulated, I will ask Ms. Lin to report the results of the voting.

The nominees for election as directors have received a plurality of the votes cast. The say-on-pay proposal has also received the affirmative vote of the majority of the votes cast. The proposal regarding the appointment and remuneration of PricewaterhouseCoopers as the company's independent auditor to serve until the Annual General Meeting to be held in 2027 has received the affirmative vote of a majority of the votes cast. The SiriusPoint share plan proposal has received an affirmative vote of a majority of the votes cast.

Thank you. Based on these results, Ms. Cross and Ms. Purtill have been duly elected to the Board of Directors as Class I directors. The say-on-pay proposal has been approved. The appointment and remuneration of PricewaterhouseCoopers as the company's independent auditor has been approved. The SiriusPoint share plan has been approved.

Before we conclude, on behalf of the Board of Directors and the Sirius Point management team, I would like to extend our sincere appreciation to Mr. Tad Montross and Mr. Peter Tan. As they conclude today, there are more than 5 years of dedicated service on the Board. I would like to commend them for their valuable contribution to the company in their respective roles. It's fair to say that they served during a tumultuous time, and they did their roles as directors proud.

This concludes the formal business of today's meeting, and I now declare the 2026 Annual General Meeting of Shareholders of SiriusPoint adjourned. Thank you for attending today, and we appreciate your continued engagement and support.

This now concludes the meeting. Thank you again for attending. You may now disconnect.

Good morning, ladies and gentlemen, and welcome to SiriusPoint's First Quarter 2026 Earnings Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded, and a replay is available through 11:59 p.m. Eastern Time on May 22, 2026.

With that, I would like to turn the call over to Liam Blackledge, Investor Relations and Strategy Manager.

Good morning, and thank you for joining us for SiriusPoint's First Quarter 2026 Earnings Call. Last night, we released our earnings press release, Form 10-Q and financial supplement, all available on our website at investors.siriuspt.com, along with the slides that will accompany today's discussion.

Joining me on the call are Scott Egan, our Chief Executive Officer; and Jim McKinney, our Chief Financial Officer.

Before we begin, I'd like to remind you that today's remarks contain forward-looking statements based on current expectations, and actual results may differ materially. We will also reference certain non-GAAP financial measures, which we believe are useful in evaluating the performance of the business. Reconciliations can be found in the presentation and our SEC filings. Please refer to our earnings release and accompanying materials for a more complete discussion of forward-looking statements and non-GAAP measures.

With that, I'll turn the call over to Scott.

Thank you, Liam, and welcome, everyone, to our first quarter 2026 results call. We've started the year with a strong first quarter, continuing to build on our performance momentum. We have delivered strong underwriting profits, disciplined growth and attractive capital returns, and I'm pleased with our delivery.

Let me start with our headline results. We delivered a core combined ratio of 88.9%, the lowest we've reported in 6 quarters. We grew our Insurance & Services gross written premiums by 8%. Our operating return on equity of 15.3% puts us at the top end once again of our 12% to 15% across the cycle target range. Our GAAP return on equity was higher at 17.4%, reflecting the closure of the Arcadian sale we announced last year.

Our balance sheet is very strong with a BSCR ratio of 242% for the first quarter. We have redeemed $200 million of preference shares and as of earlier this week, have bought back over $40 million of common shares. We are announcing today that we are increasing our $100 million buyback intention we announced at full year results by the remainder of our existing authorization, which is another $74 million.

Our book value per share is up 5%. And finally, our financial strength ratings have been upgraded to A over the past 3 months by S&P, Fitch and AM Best. These results continue to reinforce the progress we're making in building a best-in-class specialty underwriter with a diversified low-volatility portfolio.

Turning to some of our headlines in more detail and starting with our top line. There's no question that certain parts of the P&C market are softening. And in those areas, we will be disciplined. However, we believe that our product and distribution strategy and our nimble capital allocation model will allow us to grow top line and make attractive underwriting returns. Our first quarter gross written premium showed both of these dynamics.

Our Insurance & Services gross written premium grew again by 8%, driven by the continued momentum in specialty lines with Accident & Health growing by 9%. Our Reinsurance gross written premium declined 10% as we remained disciplined, particularly in areas such as property cat, where some risks did not offer adequate returns. Overall, our headline core gross written premiums grew 1%, although in Q1, this was impacted by some one-off noise, including reinstatement premiums in the prior year.

The same was true for our net written premiums, which also includes the impact of the aggregate programs we announced at the year-end and a onetime Surety item from the prior year. Adjusting for these items, both our gross and net written premiums grew around 4% year-over-year. As a reminder, the aggregate programs we purchased are part of our lower volatility return strategy and support our 12% to 15% across the cycle ROE target.

As I look ahead to the rest of the year, we remain positive about our growth prospects. We have a strong pipeline of MGA opportunities that we are rigorously evaluating and we have the agility to deploy capital in Reinsurance should we see opportunities. We expect our overall gross written premium growth to be between 5% to 10% for the full year with strong growth in Insurance & Services. Our growth will be more weighted to the second half of the year, primarily driven by the shift in mix to Insurance from Reinsurance.

Turning to underwriting performance. The results this quarter continue to reflect the benefits of the diversified portfolio we've been reshaping over the past few years. We have improved the quality of the portfolio and materially reduced volatility. The consistency of our core combined ratio over the past few years is a clear demonstration of this. In the first quarter, we delivered a core combined ratio of 88.9% and underwriting profits of $71 million. This marks our 14th consecutive quarter of underwriting profitability, an important proof point on the execution of our underwriting strategy.

In Reinsurance, our combined ratio of 84.2% improved by around 13 points, driven by lower catastrophe losses. This was partially offset by lower PYD and modestly higher acquisition costs and expenses. We remain opportunistic for the right risks priced appropriately with a focus on lower volatility outcomes. In Insurance & Services, the combined ratio improved to 92% with the ex cat combined ratio improving by just over 0.5 point. Favorable prior year development reflects our conservative reserving approach in general, but particularly for newer MGA relationships where we reserve at higher than priced loss ratios in the early years.

An improving attritional loss ratio and higher prior year releases resulted in higher profit commission accruals for our MGA partners lifting acquisition costs. We structurally design our MGA partnerships in this way where we ensure an alignment of interest to underwriting performance. The higher acquisition costs simply reflects strong partner performance. We are happy to pay enhanced commissions for superior performance.

Important to note, these are mostly accruals and not cash payments. Many of our profit commission structures include a carryforward feature, allowing profit and losses to be offset across accident years.

Our other underwriting expenses were elevated in the quarter due mostly to timing items, and we reaffirm our full year guidance range of 6.5% to 7%. This quarter, we've introduced some additional slides, enhancing our disclosures as we try and give further insights into our business.

First, we've introduced a new return on equity metric focused on our go-forward business. As a reminder, we label this our core business. Important to note that nothing has changed from a definition perspective. Our core business definition has been stable since the beginning of 2024 after the major underwriting reshaping that took place in late 2022 and during 2023. The reason for introducing the measure is to try and give people a better indication of the performance of our ongoing business without the impact of historically exited business. Eventually, runoff will run off, and I will come back to that later.

Over the last 9 quarters, the core portfolio has generated strong ROE, as you can see from the graph on Slide 9. For the first quarter, it was 17.9%, reflecting a strong trend and reinforcing the earnings power embedded in the go-forward portfolio today.

Our second area of enhanced disclosure is around our approach to MGA partnering, an area we are often asked questions on. We strongly believe in the strength of the distribution channel, its growth and most importantly, our approach to it. Slide 13 shows some metrics linked to how we think about MGAs. From our selection process, where we choose less than 10% of partners we evaluate to our onboarding, where we typically take 6 to 9 months in getting to know potential partners, to our deal structuring, where there are no volume incentives in any of our relationships and where almost 90% of our partners have incentivization linked to underwriting profits. And finally, our prudent financial management, where we typically reserve above pricing level for new partners and prudently in general.

It is this mix of measures and approach that we believe makes our strategy compelling and sustainable. But it's not just one way. We are also a partner of choice for many MGAs. And as a reminder, last year, we won the U.S. Program Carrier of the Year. We hope this slide is helpful.

Finally, we've added a page on runoff, which I touched on earlier. Runoff performance sits outside of our core metrics. And again, just to reinforce, nothing has been added to the runoff portfolio since the end of 2023, an important discipline. We did see some losses here in the first quarter, like we have seen over the past few years, there's nothing noteworthy to draw any specific comment on. Importantly, our net runoff reserves are now under $500 million, down from just over $1 billion at the end of 2023, and the portfolio should be 90% reported by mid-2027.

Ending with the balance sheet. Our disciplined approach to capital management is a key part of our strategy. Our prudent approach to reserving saw our 20th consecutive quarter of prior year releases. It's also worth noting that we have minimal claims from the conflict in the Middle East, and there has been no significant impact on our loss reserves from the change in market estimate relating to the Baltimore Bridge Collapse.

As I said earlier, so far in 2026, we've returned over $240 million of capital to shareholders, including the redemption of $200 million of preference shares and the buyback of over $40 million of common shares as part of our $100 million commitment we announced at year-end 2025. Supported by a stronger-than-expected year-end capital position, continued performance momentum and a BSCR capital ratio of 242%, we are pleased to deploy additional capital by increasing our $100 million buyback commitment to the full pre-authorization amount of $174 million.

Our leverage of 23% is at a historic low, and since our full year results in February, S&P, AM Best and Fitch have upgraded our financial strength ratings to A, citing consistent earnings and balance sheet strength, a long way from where we started.

So to close, before I pass across to Jim, who will take you through the financials in more detail, I will leave you with a few key takeaways. Our strong underwriting focus and capability continues to show itself meaningfully through our results. Our approach in building a low volatility, diversified specialty platform focused on niche distribution means we can perform strongly during softer market conditions. We are positive about our growth opportunities for the remainder of the year and expect strong growth in our Insurance & Services business.

Our prudent reserving and capital management, coupled with our rating agency upgrades position us strongly in the market. And finally, our drive, ambition and attention to detail across the company is a key differentiator in our journey to be a leading specialty player. My final comment, as always, goes to our biggest asset, our people. I am deeply grateful again to all of my colleagues for another strong quarter and for their continuing levels of energy and commitment. I'm immensely proud to lead them on this journey.

And with that, I'll turn it over to Jim to walk through the financials in more detail.

Thank you, Scott, and good morning or good afternoon, everyone. I'll start with our first quarter financial results, then cover underwriting, investments, capital and the balance sheet. We delivered a strong first quarter, reflecting disciplined underwriting, lower catastrophe volatility and continued progress in reshaping the portfolio towards higher return, lower volatility specialty insurance.

Gross written premium was $1 billion, up 1% year-over-year. Net written premium declined 7%, driven by the preannounced aggregate cover and a onetime Surety item in the prior year. Net earned premium increased 2% with growth in Insurance & Services more than offsetting deliberate pullback in Reinsurance.

Most importantly, underwriting performance significantly enhanced. Core combined ratio improved 6.5 points to 88.9%, driven primarily by lower catastrophe activity and continued improvement in attritional loss performance despite 1.2 points of mix headwind. We generated $71 million of underwriting income, a 149% increase year-over-year, which marks our 14th consecutive quarter of underwriting profitability.

Operating performance followed directly from our underwriting discipline. Operating net income was $86 million or $0.70 per diluted share, up 37% year-over-year. Operating ROE for the quarter was 15.3% and core operating ROE was 17.9%, comfortably within and above our 12% to 15% across the cycle target.

Net service fee income reached $8 million, with service revenues at $54 million at a 14.6% margin. Excluding the Arcadian sale, net service revenues rose 26%. Net fee income increased 34% and margins improved by 80 basis points. Net investment income totaled $66 million, leading to an overall investment result of $78 million. The fixed income portfolio's average credit quality remains AA-.

Finally, book value per diluted share, excluding AOCI increased 5% sequentially to $18.98, reflecting both earnings and disciplined capital management.

Turning to our core specialty lines with details available on Page 11. Accident & Health, our largest line at approximately 28% of the premium mix continues to perform well. Premiums grew 9% year-over-year, driven by strong opportunities in travel and U.S. medical. Importantly, this remains a low capital intensity, low correlation line that enhances portfolio resilience. Employer stop loss has been challenged for several years with premiums generally flat since 2021. We maintain a strong book and based on available U.S. statutory data, our loss ratio has run more than 10 points favorable to the market average for multiple years. The market is showing early signs of hardening. And given our underwriting expertise, we may selectively lean back in as conditions improve.

General Liability conditions are mixed. Competition is intensifying as the E&S market continues to expand with early and selective softening emerging in terms and conditions. Primary and umbrella pricing remained technically adequate, while excess continues to achieve double-digit though moderating rate increases that exceed loss cost trends. We are underwriting cautiously and maintaining strict return thresholds.

In Other Property, pro rata reinsurance pricing has softened, particularly in commercial lines, and we adjusted accordingly. Property insurance niches continue to offer attractive opportunities. And while premiums were flat this quarter, we expect selective growth through the remainder of the year, driven primarily by insurance.

Financial and professional lines remain competitive, particularly in D&O and professional. We believe the cycle is nearing a bottom, and we are underwriting selectively. In transactional liability, which is bucketed here, pricing remains competitive, and we continue to prioritize risk selection over volume.

Within other casualty, auto remains challenged with loss cost inflation running ahead of rates, we have and continue to pull back exposure accordingly. Surety continues to be an attractive diversifying line with disciplined growth. In aviation, we remain cautious. Major airline pricing has improved, and we continue to reduce exposure where returns do not meet our criteria. Credit remains well priced with rate adequacy intact.

Marine and energy market conditions are mixed. We see attractive opportunities in energy liability and select niche segments, while upstream remains competitive. Marine, particularly cargo and hull, continues to experience elevated competitive pressure.

Finally, Property Catastrophe Reinsurance, now approximately 4% of the portfolio, saw rate declines of about 15%. Gross written premium declined 31%, reflecting lower reinstatement premiums as well as a deliberate pullback consistent with our continued focus on capital discipline over top line growth.

Slide 19 highlights the impact of the deliberate actions we've taken since 2022 to reduce catastrophe exposure. In the first quarter, catastrophe losses were $63 million lower year-over-year and represented just 0.8 points on the combined ratio compared to 10.9 points in the first quarter of last year. The enhancements we've made materially improved the stability and predictability of earnings, a central objective of our portfolio reshaping.

Turning to reserving on Slide 20. We reported favorable prior year development of $32 million within core and $18 million consolidated, marking 20 consecutive quarters of favorable development. This track record exceeds the average duration of our liabilities and reflects a consistently prudent reserving approach, supported by quarterly bottom-up actuarial reviews, independent external validation and the continued benefit of our loss portfolio transfers, all of which retain significant protection in excess of booked reserves.

Investment performance found on Slide 21, remains strong and stable. Net investment income was $66 million, contributing to a $78 million total investment result. We experienced no defaults in the quarter. 99% of the fixed income portfolio remains investment grade with an average credit rating of AA-. Portfolio duration remained steady at 3.1 years and reinvestment yields continue to exceed 4.5%. We continue to prioritize quality, liquidity and downside protection in the investment portfolio.

Slides 22 and 23 provide capital and balance sheet details. Our capital position remains a clear strength. The estimated BSCR ratio was 242% even after the preference share redemption and includes net capital generation during the quarter. We continue to operate the business against the capital framework consistent with S&P's AAA model assumptions. Leverage declined further. Debt to capital decreased to 22.8%, the lowest level in several years. Liquidity increased to over $1 billion, driven by upstream dividends and holding company investments.

Importantly, we continue to believe the balance sheet undervalues our MGA platform, particularly IMG. In the quarter, book value increased by $25 million from the completion of the Arcadian sale. This is in addition to the $96 million uplift recorded upon Arcadian's deconsolidation in 2024.

To summarize, this quarter reflects the results of a multiyear strategy focused on underwriting excellence, capital discipline and volatility reduction. We delivered strong underwriting profitability, continued improvement in attritional loss performance, returns within and above our through-the-cycle targets, continued capital strength and balance sheet flexibility.

While we're pleased with the progress, our focus remains on execution as we continue building a best-in-class specialty insurance franchise.

With that, I'll turn the call back to the operator, and we'll open the lines for questions.

[Operator Instructions] Our first question comes from the line of Michael Phillips with Oppenheimer & Co.

I want to start with the comments in the press release about the areas of growth, and then I heard some of Jim's comments through the lines of business. Particularly, you mentioned in the press release a growth in general liability, and that's an area where there is some concern. We even had a CEO just yesterday say, hey, by growing in general liability is crazy. I'm paraphrasing. But maybe you can talk about that line given the comments that Jim made about intensifying competition and where you're seeing growth in GL and why anyone shouldn't be concerned about that.

Mike, thanks for your question. As always, thanks for joining the call. So let me make a couple of general comments on growth, Mike, if you don't mind, just before we dive into the details. So look, I think for us, in Q1, we were pretty pleased with the sort of position, obviously, a tale of 2 different dynamics, as I said in my overview between Insurance and Reinsurance. If you look at our growth in Q1, we're pretty pleased with where the Insurance business has grown, and we're very happy with both the relationships and the pockets, and I'll come back specifically to GL in a second.

And look in Reinsurance, I think for us, Q1 is probably the most extreme shrinkage that we'll see probably due to the sort of property cat 1/1s. So we probably expect it to be stronger year-over-year in the remainder of the year. But ultimately, we're just going to remain very disciplined in that marketplace, but obviously, property cat being the dominant line.

Look, in terms of how we're thinking about the growth, look, for us, the momentum that we have in Insurance, I think, remains strong. We brought on 2 new relationships in Q1, and we remain with a strong pipeline. We think double-digit growth in insurance is actually our aim for the year, and we think we're well positioned for that.

In terms of the areas, maybe just to dive in there now. Look, GL, I'm not a fan of big ticket statements, right, on stuff. I think for me, we are very alert in GL. And so we are absolutely seeing competition intensifying and particularly as E&S continues to expand. And we're seeing some sort of selective T&C softening. So we don't see it as a sort of banner headline panacea, but we're staying disciplined. We're very happy with the MGAs that we're working to access the market.

Excess casualty, for example, our largest segment, continues to price ahead of loss cost trends, and it's the largest portion of the portfolio. So look, and I'll pass across to Jim because obviously, you commented on it, Jim. But look, I think for us in GL, we're very sort of disciplined. We're very alert and awake. But there's no such thing as big banner general headlines. I think there are areas, pockets and one of the advantages of the MGA distribution strategy is we believe we get access to sort of niche business, niche markets, and we do always think that's a complete strength of the group.

But listen, to be really clear, if we don't see price sort of match the risk that we're taking, and we're not frightened to move capital around the group, which we've said many times. But Jim, you commented on it in your overview, why don't you add anything to that, that you want to?

Yes. I'd add just a couple of things. In terms of the comment, I'd rehighlight what Scott had mentioned about us really being a specialty underwriter. And so there's going to be times where we're not going to follow some of the more broad general trends across the market because we are writing very specialized risk when we're going in through here. We are working with people who are experts in their particular area. And again, we're not trying to do kind of the broad commoditized particular products that are in the market. We're really focused in the specialty areas, have requisite knowledge to do that. And again, we remain very price disciplined on that point.

The second thing that I would just call out in terms of the broad kind of growth component Scott highlighted kind of the change in the property cat down 31% on kind of a year-over-year basis. What you're seeing is as we have shifted to more insurance and especially the components in reinsurance because that would be the biggest component that would have a real seasonality trend to it within reinsurance. The book of business is now much less seasonally weighted. And so you're going to see much more stability in terms of what those gross written and those net written premiums are going to be throughout the year.

And so what that means is some of that growth that you saw in the second half of last year, you're going to continue to see that, that has stabilized the net total of the book. And so you should be thinking about it in a much more even weight from a premium distribution perspective, at least relative to what we saw kind of based on Q1 kind of playing out through the remainder of the year.

So Mike, look, I hope that gives you -- I know we give you a sort of pretty fulsome answer that covered more than GL, but hopefully, that gives you a flavor on how we're thinking about overall growth, which is really strong in insurance, disciplined in reinsurance, and we expect it to sort of close year-over-year beyond the kind of key 1/1 property cat date for us, but disciplined in every respect, and we'll move capital around. The great news is lots of opportunities and a strong pipeline. So Mike, does that answer your question?

Yes, sure, it does. That's helpful. That's what I was getting at. The second question is maybe more on the modeling specifically, but it has higher level implications, I guess. In insurance because of the higher acquisition costs because your profitability, your profitability is strong and likely going to continue, I would think. So should we expect that higher acquisition cost to sort of continue over the foreseeable future?

Yes. Look, Mike, it's a great question. And we've tried to be explicit in the voice over and stuff. The answer you might not like, isn't a perfect one, right, which is sometimes it depends on what relationships, for example, come out through the prior years. So it sort of depends. And what I mean by that to give it some color is, obviously, if you've got sort of historical losses, then a prior year release wouldn't necessarily mean an automatic profit share accrual. But if you've got prior year profits and then you add to that with prior year release, then effect, your accrual can go up.

And we see that actually as a strength of the deal structures that we put in place, which I think we've talked about before, where it's not just sort of 1 year and done. And be really clear, these are accruals. They're not cash payments. So look, it's one thing that we were agonizing over sort of how we help through our disclosures, and I think we'll continue to be thoughtful with that. But I don't think you can just purely take the PYD line and the acquisition line in quarter 1 and extrapolate it out because it is a sophistication, unfortunately, on a partner-by-partner basis that sits behind that.

So not a great answer back to you, but I think you understand the strategic logic, which is the business is performing well and at a high level of ROE. And we're at a point now where in the round, PYD will mean more profit share accruals, but it's not sort of exact science if that makes sense.

And Mike, what I might add is we continue from a composite ratio to generally improve. Sometimes you got to add in that prior year development. So if you're thinking about the prior year development in the Insurance & Services and some of the breakouts that we give you from a supplement perspective, you're seeing 3.3 points of prior year development, right? And then you're seeing a little bit of an offset there on that A&O component, right, where we're paying out profit commissions in relation to that.

But when you look in total, right, and you add up those combined ratios to that, you continue to see about, on a year-over-year basis, another point improvement, right, from an underlying perspective. So we might have some geography elements that kind of come in up or down, right, relative to those areas. But I would be thinking about it in terms of that net total and thinking about the equation being solved in total, right? Because if we have a little bit more favorability in prior year development or other in that segment, we might pay out a little bit more on profit commissions, as Scott said. But overall, we're seeing a continued trend of strong underwriting profit coming in through there.

Okay. Jim, that's helpful. And then maybe just lastly, a little more higher level. You've done some, I guess, the phrase, restructuring a bit recently in part to focus more on the Lloyd's market. I guess maybe I just want to hear from you kind of what you expect to get out of that, the new focus of the London Market specialty division that you created, when we might see some impact to what we model in the next couple of years? Or is that too soon? Just kind of initial strategies there and expectations for longer term.

Very good question, Mike, again. So look, let me talk about this one. I'd say this is much more a strategic journey. And so just because we've kind of relabeled it and relaunched it London Market specialty, it doesn't mean it didn't exist in the organization, Mike, which I know you know, but I just want to reinforce for clarity. When I joined here sort of 3 years ago, I have to be frank, and I think I was upfront about it, our Lloyd's syndicate and managing agent, we had to do some remediation work to improve our underwriting and improve our processes and quite frankly, improve our sort of standing and reputation with Lloyd's.

Actually, in the recent sort of syndicate announcements, we've moved over those 3 years from sort of fourth quartile performance to now second quartile performance. We want to try and be first, but that's, I would say, look, demonstrable improvement. And actually, good timing in asking the question, Mike, which is we had our group board across in London this week, where actually we had a market event, which was sort of relaunching London Market specialty with much more of a profile now that we've sorted out the sort of some of the behind-the-scenes stuff. We were very lucky that Patrick Tiernan, the CEO of Lloyd's actually joined us at the event as well, which actually sort of reaffirmed their commitment to us, our commitment to them.

And I would say it's something that we find attractive as a marketplace because it's a huge specialty market, not quite as big as the U.S., but not far off it. And so we think a U.S. specialty market and for me, a London specialty market are very attractive strategically, and we think that diversification gives us an edge. So look, that's how we view it, Mike, strategically, hopefully, a bit of honesty there in terms of the journey we've been on. And part of the rebadging of it is us now pulling it out from slightly below the bed covers and giving it a profile that we think it now merits as opposed to when we were doing the remediation work.

So does that help? Hopefully, if it starts to sort of snowball for us, we will, of course, give -- we'll be very open about it and give disclosure on these calls. But hopefully, that gives you a bit of flavor, Mike.

Our next question comes from the line of Gregory Peters with Raymond James.

But I think the first question would be, I know you're targeting this profitable, low volatility type of result for the company. Listening to some of the other calls, it seems like war risk and political violence, it seems like those markets in the Middle East are on a tear at least from a pricing perspective. And I'm not saying you're looking at that market, but when we hear anecdotally of certain markets where the rate is going up substantially, maybe you can talk to us a little bit about how you view that because some of those opportunities may be an intersection and work against the low volatility target you have in mind.

Greg, I think it's a great question. Thank you. Just so you know where we are, we're in Zurich. Yes. So we've had a busy week. We dragged our group board from London to Zurich to visit our employees over here as well. So that's where we are. So it's good afternoon for us over here.

Look, I think your point is a good one. And it's sometimes the banner headline low volatility is sometimes misunderstood. That does not mean we don't have higher volatility areas. Property cat is probably the most obvious one. PBT, I think you're right, is another one. It's just another form of cat to some extent. So we are alive to where we see opportunity in the marketplace, and we're not afraid to take volatility.

The lower volatility comment comes from how we manage the overall portfolio and effectively how we buy some of our sort of reinsurance, retro protection or aggregate covers, et cetera. But we are not afraid to take volatility. And do I agree with what you've just said on PBT in terms of the rate and potentially there's good moments and to get these markets with higher volatility? Yes, I do agree, right? And I wouldn't rule that out for us.

But I think we'll manage it within an envelope overall of much lower volatility overall, which is how we manage the book. And obviously, things like A&H and the growth in A&H, which I've said many times before, when A&H grows, that effectively means we can take more volatility yet somehow overall make sure that the portfolio remains at the same level of volatility pre the growth, if that isn't too worthy. So look, I think not afraid to do it. If we do, we'll certainly tell you not just in PBT, but in other areas. And I don't want lower volatility to be misconstrued to us not taking risk because that would be wrong, right? So hopefully, that clarifies it, Greg.

Yes. The other question I had, just coming at the MGA piece from a different angle. And the angle is if you're an MGA in the marketplace in North America or elsewhere, it seems like you have a lot of different options at this moment in time on which carriers to partner up with. It seems like there's a number of companies out there that are willing to sponsor MGAs. Most of them say we only sponsor great MGAs, not the bad ones. So I don't know how to figure that one out.

But from the perspective of -- as you're going through the process going forward of identifying other MGAs, just wondering how you win that narrative because I'm sure if it's a good MGA, they have other alternatives that they can consider.

Yes. I completely agree with you. And we are not arrogant enough to say, oh, they all come at us because we are the best. That's not true. There are certain lines of business, certain areas that we are really good at. Greg, there's others where, quite frankly, they will go and find other carriers. So some of it, I think, is product and expertise choice. I think though some of this is about behavioral choice as well.

I think what people find when they come to us and they see our people, what they see is people who are sort of nimble, agile, quick, responsive, are happy to kind of listen and work with our partners to try and work out what they are trying to do, whether that be around product flexibility, design, et cetera. And those things matter because some people in the marketplace, you sort of get what's in the box. And if you don't like that, then you have to walk on and find someone else.

Equally, we don't win every single relationship that comes in. But what I can say is this, and I keep reinforcing it, we've had double-digit growth in our Insurance and MGA business now for the best part of 2 years. And for us, therefore, that talks to we must be doing something right. The second thing is, which I mentioned actually in my overview, we are very careful about who we work with. So to your point, about bad MGAs or good MGAs or whatever phraseology people want to use, we don't think of it that way. We know the attributes that we are looking for. And that's why we added the extra slide this quarter to try and give you a sense. It's not exhaustive, but hopefully tries to give you a sense as to how we think about the type of partners that we want to work with.

And then look, the final comment, which we're not in any way being egotistical, I promise you, but you don't win U.S. Program Manager of the Year if actually you're not sort of doing the right things for your customers. And therefore, that award for us, given our strategic focus is really, really, really important. But ultimately, we have to make money as well. And that's why Jim's comment earlier on about the continuing performance improvement in our Insurance business is really important.

We're not a charity. We're here to make money. And that's why we love in our design that when they make money, we make money. When we make money, they make money. We think that's a pretty smart design. They seem to like it. We like it. Our pipeline is strong. And honestly, for the rest of the year, we are feeling pretty upbeat about our sort of top line and bottom line performance.

Our next question comes from the line of Andrew Andersen with Jefferies.

This is Charlie on for Andrew. I was just wondering if you guys could provide a little bit more color on the attritional loss trends that you're seeing in insurance lines and whether you're seeing kind of early signs of changes in the spread of rate versus loss cost trend.

Yes. No, thank you. Big picture-wise, what I would tell you is we continue to see enhancements in our attritional. You're seeing a 30 to 40 basis point kind of net improvement. When you double-click underneath that, what you're seeing is about 1.2 to 1.3 points of mix headwind that is being offset.

And when I say mix headwind, that's not a negative component per se. But when you bring down property cat, that tends to run at a much lower attritional loss ratio. It's being replaced by things that run at a higher potential attritional loss ratio, but at a very strong ROE perspective.

So even with that, though, we improved on a year-over-year basis by about 40 basis points. And that's because of the continued underwriting enhancements in our selection that we continue to bring to bear as well as the insight that we share with our partners and others that help them to continue to underwrite at a really strong basis.

Okay. And then just on the guide for the 6.5% to 7% other underwriting expense, could you guys just talk a little bit about what the underlying levers to pull there are and what's kind of embedded in that outlook?

Yes. So when you think about like the quarter, there are a couple of things that I would point to. There's some positive things. There's a little bit of variable compensation that is in there because of our continued outperformance from a company perspective and from an underwriting perspective. A secondary component that is inside there is really just a timing element in terms of hiring and just kind of the net basis for when premium and other elements come on.

And so when we think about where we're at, we were thinking we would be, again, in that 6.5% to 7%. We're a little bit higher at that 7.2% range today. but just the natural kind of growth of the business, the natural hiring elements and the seasonality that kind of comes with that, our internal view is we are expected to be lower in the second half of the year. And when you take those 2 things, that kind of averages out to we're going to be in a range of 6.5% to 7% for the year or at least we remain pretty confident in that.

There's nothing that's fundamentally changed from our underlying assumptions or levers that we have to pull to get there. It's just us continuing to be disciplined on our expense lines, which we will be and always are and for us to continue to underwrite with where we're expected to be.

And Charlie, look, it's Scott here. The other thing I'd add and it's not for now, probably a later call is we're investing in the organization and data transfer between ourselves and the MGAs and with a view of industrializing that process, we've already got about 10% of our MGAs on that. And obviously, we're at the gremlin stage and making sure that it works properly. But we do see both a huge advantage from a data and speed perspective.

But ultimately linked to that, there will be cost advantages as well if you can sort of send claims, premium underwriting data down pipes as opposed to having to sort of rekey, et cetera. So those are topics for future calls. But just to be very clear, we're making investments in the organization that we think can be a sort of a tailwind with regards to our cost ratio. And of course, we'll benefit from economies of scale like other people as we grow the business and have done over the past few years. So those would just be a couple of additional points I would add to Jim's answer.

Our next question comes from the line of Timothy D'Agostino with B. Riley Securities.

Apologies if I touched on it again, I joined a little bit late here. But I guess in terms of returning capital to shareholders, obviously, you guys have done a great job with pref buyback, $42 million of common share repurchases and then increasing the share repurchase commitment by $74 million back to the fully authorized $174 million.

So I guess as we think towards the end of 2026, are share buybacks the main kind of source and avenue of returning capital to shareholders? And then as we think to '27 and '28, if performance keeps up, I mean, has conversations of a potential dividend or special dividend come up? Just understanding once you're kind of at the point where you feel your shares are adequately priced and you've done a bunch of share repurchases, does the dividend then become more in focus?

Yes. No, thanks for your question. Tim, I'll kick off and Jim can jump in as well. So look, I think I would hope anyway that as we've gone through this journey, you can see we've returned a lot of capital to shareholders, and that includes obviously the very significant buying out of China Minsheng, et cetera, over time as well as a couple of the things that you mentioned.

I think just to be clear on our buyback, we obviously went through sort of the truing up of our year-end capital, and we thought given the strength of our balance sheet that it was a real signaling strength to further increase that to our pre-authorization levels. I think and I'm looking at Jim, we've got about, as we sit here today, about $135 million of that and $174 million left to deploy, just to give the people on the call a data point. Obviously, that changes every day, but it gives you an order of magnitude in that regard.

With regards to capital, sort of deployment in the future. Number one, we always decide when we get there, not in advance. But I would say, look, we're pretty agnostic as to what the different mechanisms may be to return capital to shareholders. And I think, obviously, we've focused on the buyback given our valuation and share price, we think it's good use of capital and for shareholders. I think ultimately, as we mature, we will engage with shareholders and investors over time.

And there's no sort of reason why if we wanted to do a dividend, we wouldn't do it or a special dividend. So I think all options are on the table, Tim, would be what I would describe. And ultimately, we've still got quite a lot of firepower to do in the buyback that we've just announced. But Jim, anything you want to add to that?

Yes. Similar, I'll just build on what you said, Scott. And we'll decide when we get there. But when you think through kind of the levers that we look at, at that point in time, one, we're looking at kind of the attractiveness of the insurance markets, our specialties, where pricing is relative to that and our expectations there. And we start, first and foremost, with kind of making sure that we've got the right amount of capital reserved and deployed to there where we see that profitability from an organic growth perspective.

The second thing then becomes from an investment perspective, how are valuations inside the market, what are other opportunities that we have to strengthen kind of the overall organization. And where do they sit from a return on capital perspective from that perspective. And so if you see really strong opportunities, really strong returns, we'll look to build and increase that value for our shareholders at that stage. If we don't see that, then we would look at the attractiveness from a market perspective from buybacks to dividends. And what we're committed to doing is the elements that are in the best interest of our shareholders and ensuring that we execute very thoughtfully against that.

Okay. So I think, hopefully, that gives you flexibility, Tim. Nothing on or off the table, but hopefully answers your question.

Yes, it does. And I appreciate the color. And if I could ask a second one. Just on the core specialty lines, I guess, as you talk about growth and I look at maybe some of your smaller specialty lines, aviation, credit, marine and energy, currently looking at Slide 11. I guess could you maybe walk us through across maybe the smaller lines, is there anything that's sticking out to you that's interesting in terms of pricing, whether that be by line such as aviation or credit or maybe by region being Europe, the U.S. Just any more color on maybe those smaller specialty lines.

Yes. Look, I'll kick off and give a couple of high-level remarks and Jim, jump in on the pricing and stuff like that. So I think we said on the full year results call, aviation, we said we agreed that the market needed to price. I think Lloyd's had said that last year, we would agree with that. I don't think there's anyone who's in the aviation market that wouldn't say that it needed rates. And so we were really pleased in Q4, which is when we do our sort of major renewals on airlines that we got sort of high double-digit teens rate. So that was really important for us.

So I think for us, in aviation, we've seen for us anyway, we've seen rates start to come back in, and we would expect that to emerge more in our top line as the year goes on for obvious reasons. But I think it still needs some more rate. And so we would expect to keep our foot down on aviation rates, the principles that I talked about earlier on of having reward for appropriate risk. I think in aviation, there's still more to do. But I think Q4 for us was a good start.

I think marine and energy sort of different for us. I think Marine, in particular, and particularly in the London market has softened and softened quickly. That said, therefore, we are very selective. It doesn't mean to say we can't find good risks and good opportunities, but we're very careful in the marine and energy book given its price softening over the past sort of particular 12 months. But as I say, look, we are finding pockets, but we have to go looking for them.

And look, I think credit for us, we've long established in credit. It's been a very profitable line for us. In fact, we had sort of prior year releases from our credit book in Q1. We are very, very cautious and careful and around sort of our reserving for credit. And for us, look, we just take a very prudent approach to our reserving on it, and we'd rather reserve prudently and then have PYD on our credit book. I would say our credit book is sort of small-ish but perfectly formed. We're not trying to sort of punch the lights out in terms of growth. If we see opportunities, we'll take it. We're more in the sort of reinsurance space in credit as opposed to the primary space, although we've just taken on some MGAs in the credit space as well as we take those sort of first steps down that path.

So smaller lines, each with their own dynamics. But hopefully, that gives you, Tim, a little bit of color. I promise you this, the size doesn't make any difference to the detail, orientation and focus that we have. We've got deep specialists within the company who every single day wake up worrying and caring about those lines. But Jim, I'm sure I've missed something. Anything you want to add?

I'd just build on inside of the credit market, as we highlight, we think it remains well priced. A couple of areas I might call out underneath that might be trade credit, political risk, international mortgage. Again, we continue to be really prudent and disciplined there, but feel good about the shape of those markets. And then I might also highlight energy liability. We continue to see rate strength there, especially coming in through U.S. risk.

Hopefully, that gives you a bit of color, Tim.

Yes, it definitely does.

[Operator Instructions] Our next question comes from the line of Michael Phillips with Oppenheimer.

Just a quick numbers question. Scott, you mentioned the reinstatement premium on the core moved it up to about 4% for gross. What was the impact, if you could say, on Insurance?

It moved it from 8% to double digit, Mike. So look, what we didn't want to do is sort of have lots of underlying numbers and stuff like that. I promise you the underlying performance of Insurance & Services in Q1 was double digit, and we expect it to be double digit for the rest of the year. So hopefully, that gives you the right message.

Yes, that does. Just want to make sure.

And we have reached the end of the question-and-answer session. Therefore, I'll turn the call back over to management for closing remarks.

Well, as always, thank you so much for joining the call. We do appreciate your questions as well. Look, I would say, in summary, a good and strong first quarter. Again, the momentum that we have within the business is continuing, and we are feeling in a very good position for the rest of the year.

And with that, I wish you all a good weekend, and we'll speak soon. Thank you very much.

Thank you. And this concludes today's conference, and you may disconnect your lines at this time. We thank you for your participation.

Good morning, and welcome to the SiriusPoint Fourth Quarter 2025 Earnings Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the call over to Mr. Liam Blackledge, Investor Relations and Strategy Manager. Please go ahead.

Thank you, operator, and good morning or good afternoon to everyone listening. I welcome you to the SiriusPoint Earnings Call for the 2025 Fourth Quarter and Full Year Results.

Last night, we issued our earnings press release and financial supplement, which are available on our website, www.siriuspt.com. Additionally, a webcast presentation will coincide with today's discussion and is available on our website.

Joining me on the call today are Scott Egan, our Chief Executive Officer; and Jim McKinney, our Chief Financial Officer. Before we start, I would like to remind you that today's remarks contain forward-looking statements based on management's current expectations. Actual results may differ. Certain non-GAAP financial measures will also be discussed.

Management uses the non-GAAP financial measures in its internal analysis of our results of operations and believe that they may be informative to investors in gauging the quality of our financial performance and identifying trends in our results.

However, these measures should not be considered as a substitute for or superior to the measures of financial performance prepared in accordance with GAAP. Please refer to Page 2 of the Investor Presentation and the company's latest public filings with the Securities and Exchange Commission for additional information. I will now turn the call over to Scott.

Thanks, Liam, and welcome, everyone, to our fourth quarter and full year 2025 results call. The fourth quarter rounded out another very strong performance year for SiriusPoint. Our disciplined underwriting strategy, customer-first mindset and relentless focus on delivery means we have a lot to be pleased about as we look back on our progress in 2025.

Our top line for the year grew 16%. We improved the quality of our underwriting earnings year-over-year by 1.5 points. We grew our diluted book value per share by 28%. We delivered a 49% increase in operating earnings per share over prior year, and our leverage will reduce to an all-time low of 23% by the end of February.

Our 2025 operating return on equity of 16.2% has improved for the third consecutive year and more importantly, outperformed against our 12% to 15% across the cycle target. The performance momentum I have talked about many times in these calls can be seen in the metrics that we've delivered in 2025.

Looking at the fourth quarter in isolation, we delivered operating return on equity of 17.1% with a 44.9% return on equity on a GAAP basis as we closed the sale of Armada for $250 million. Our diluted book value increased by $1.70 in the quarter as a result. We continue to produce strong underwriting results with a Core combined ratio of 92.9% despite some historical one-offs in acquisition costs, which Jim will unpack for you.

In addition, the fourth quarter saw a strong growth trend continue with gross written premiums growing 18%. Turning back to look at 2025 as a whole, there is much to be proud of beyond the financial headlines. We simplified our ownership structure through the closing of the CM Bermuda transaction in the first quarter.

We earned positive outlook upgrades from 3 of our rating agencies. We saw employee engagement scores rise again to an all-time high. We completed the sale of Armada MGA and announced the sale of Arcadian MGA, which crystallized $390 million of liquidity and almost $200 million of off-balance sheet value while agreeing long-term capacity deals on underwriting.

Finally, it has been important to attract top talent to the company while growing talent internally. We have had great momentum. And in 2025, we welcomed 18 senior leaders to the company as well as promoting 6 from within.

Focusing back on our full year 2025 operating return on equity of 16.2%, there are a number of important points I would like to make. It is ahead of our 12% to 15% across the cycle target, having only set this 12 months ago and is the highest the company has achieved.

We have also improved this metric every year for the past 3 years as we execute hard to build performance momentum across all of our business lines. Despite our return on equity target being an annual one, we have managed to deliver either within or above our range in every quarter this year despite impacts from events like California wildfires.

We believe this is an important evidence point to our lower volatility portfolio and the track record we continue to build demonstrates our approach to underwriting, risk management and capital allocation.

I want to take a moment to briefly focus on Slide 9. Even though it is one that we've included for a while, it is actually a very important one to pause on at the end of another calendar year. It clearly shows the underwriting track record we have been building since we reshaped the portfolio late in 2022.

Since the third quarter of 2023, our combined ratio has been relatively stable and benchmarks well against our peers. We do recognize that insurance market conditions will be tougher in 2026, but it is also important to highlight that not in every market. We strongly believe our diversified portfolio and distribution focus on partnering with specialist MGAs positions us well to maintain our current levels of performance.

It is worth noting that in 2025, 60% of our growth came from lines that are less correlated with P&C pricing cycles with accident and health being the largest contributor. The last quarter of '25 and the start of 2026 has been in line with our planning assumptions. Our focus will be on underwriting performance first over growth.

Slide 10 focuses on volatility. I want to briefly touch on 2 actions, which help us to deliver against our lower volatility strategy, which we've added some new slides for this quarter.

Firstly, as part of this strategy, we do target higher growth in insurance over reinsurance. We continue to believe the growth opportunity in insurance is more compelling in order to meet or exceed our target ROE year in, year out, while operating within the risk corridor we are comfortable with.

That said, reinsurance is a key part of our business mix and many of our relationships with MGAs can either start as a reinsurance relationship or be a blend of reinsurance and insurance.

This mix of capabilities is compelling both for us and for our partners and gives us and them great flexibility. We will also be opportunistic in reinsurance, where we see rates driving returns that are commensurate with the volatility and risk that we take and that fit within our overall portfolio volatility appetite. We are happy to allocate capital for these opportunities, and we'll continue to do so in 2026 as they arise.

Our evolution over the last few years has meant that roughly half of our premiums are now U.S. specialty, and this is by far our largest underwriting platform.

Secondly, our Accident & Health business is a strategically important part of our portfolio. With a long track record of high returns, its low volatility and low capital intensity acts as a volatility shock absorber to some of the other lines we write outside of A&H. We manage this mix carefully and dynamically to achieve our overall strategic aim of a lower volatility portfolio.

Our Accident & Health gross written premiums grew by 23% in 2025 to around $1 billion. And overall, it makes up around 27% of our business mix. It also has a low correlation to wider P&C pricing and market trends. The profit consistency of Accident & Health, which boasts over 20 years of profitability, allows us to plan a wider portfolio mix with high levels of confidence.

Following the sale of Armada in October, we now have 100% owned A&H MGA, IMG, which is consolidated into our P&L. IMG is a core part of our future plans. It drives a strong set of fee income profits in its own right as well as providing around 1/4 of the gross written premiums to our accident and health underwriting business, underlining its strategic importance.

We believe the combined A&H underwriting business and IMG is compelling strategically. In 2025, we appointed a new CEO for IMG, Will Nihan. We also recently announced a small acquisition of Assist America. Assist America has been privately owned since it was founded in 1990 and provides global emergency travel assistance services to insurance companies worldwide.

The client base includes many of the leading insurance companies in the U.S., Asia and the Middle East, widening our worldwide offering in these services and building on the already strong U.S. and European infrastructure we have at IMG.

With a target addressable market of around $4 billion in medical and travel assistance services, we believe the acquisition is a great opportunity to further build out our service fees.

Following completion and integration in 2026, we expect the fully integrated business to add around $4 million to $5 million of EBITDA annually.

More recently, we also announced the acquisition of World Nomads by IMG. World Nomads is a global travel insurance platform with a strong recognizable lifestyle brand and distribution model. The acquisition presents the opportunity to increase our trip cancellation premiums and revenues and meaningfully expand our global distribution capabilities. These are areas that we have grown significantly over the past 12 months under the IMG brand.

Following completion and integration in 2026, we expect this business to also increase EBITDA by around $4 million to $5 million annually. I would like to welcome our new colleagues from Assist America and World Nomads to IMG and the SiriusPoint Group.

We expect our IMG business to generate over $30 million of fee income and over $35 million of EBITDA in 2026. The [ adding ] value of IMG on our balance sheet at year-end was $77 million. And although this will increase upon completion of the new acquisitions, we continue to strongly believe it is undervalued relative to IMG's enterprise value and as a result, understates SiriusPoint's overall book value.

Looking more holistically at the acquisitions, these investments into IMG and our A&H business reinforce the importance of both the specialty as part of our portfolio and our diversification from capital-light fee income. We strongly believe these are additive to our story and performance momentum.

Touching briefly on our distribution relationships with MGA partners. The fourth quarter saw us add 3 new partners who we have spent several months getting to know and doing due diligence on.

As I have mentioned many times before, we take a very disciplined approach when onboarding new distribution partners. We reject over 90% of opportunities presented to us and we will only partner with MGAs who we believe we will work with on a long-term basis and where we have an aligned philosophy in relation to underwriting excellence and data sharing.

As a general principle, we also take our time with new partners and taking underwriting risk. This slide shows this. While roughly 1/3 of our partners have been onboarded in the last 2 years, their premiums make up under 10% of our MGA premium mix.

Higher premium volumes with partners where we have greater historical experience is core to our philosophy and approach, which we think makes a lot of sense. Almost all of our partners risk share with us and have skin in the game. We think this is an important part of the relationship.

A few points from me to close before I pass across to Jim to go through the financials in more detail. Since our third quarter results, we have now closed on the sales of Armada and Arcadian for a combined value of $390 million and the proceeds have been received.

Armada closed in the fourth quarter, and the sale is now included in our financials, whilst Arcadian closed at the end of January and so will be included in our financials in the next quarter. As a reminder, Arcadian will be less significant from a capital and book value perspective, given the $96 million value recognition we took upon deconsolidation in the second quarter of 2024.

As we announced last quarter, we intend to use part of these proceeds to fully redeem the $200 million worth of 8% preference shares next week at their upcoming rate reset. We announced this formally via an 8-K filing at the end of January.

This will reduce our leverage ratio to 23% by the end of February, which is a historic low for the company and is actually below the levels we were operating at before the settlements agreed with CM Bermuda in 2024. We believe this is a good use of funds, provides us with greater capital flexibility and points to a continued strong balance sheet management.

Our overall capital remains strong, and our fourth quarter BSCR ratio has improved to 247%. Pro-forma for the upcoming Preferred Share Redemption, it is still a very healthy 232%. Our standard practice is to assess our capital position at the end of each year. And so today, we are pleased to be announcing our intention to repurchase $100 million of our outstanding common shares over the next 12 months.

At our current market price, this represents over 4% of the total shares outstanding. We expect this to be accretive to EPS and ROE throughout 2026 and book value per share by 2027. We believe our strong capital position and the continuing earnings profile of the business leaves us in a very strong position to fund growth opportunities in 2026.

Before I conclude, I want to briefly look back to this time last year. 12 months ago, when delivering our 2024 full year results, I commented how our repositioning was materially complete and that SiriusPoint was a business with an earnings profile of $300 million.

This year, we have demonstrated that again, delivering operating income of $310 million. Importantly, on an operating earnings per share basis, this is up 49% year-over-year, meaning our shareholders are benefiting from our continued execution and value creation. And with that, I will end back where I started.

This year saw consistent and improving underwriting performance, strong premium growth, book value and operating earnings per share growth and significant value brought onto the balance sheet from our ongoing MGA rationalization.

We continue to lay further foundations for continued profitable growth, investing in people and technology to improve our performance further.

We achieved another record operating return on equity, which could not have been possible without our greatest asset, our people. The team has worked tirelessly to achieve these results, and I could not be more proud of them or grateful to them for their unwavering support. I do not take it for granted.

While 2025 was another strong year for the company, complacency is not in our DNA. We are relentless in our ambition to become a best-in-class specialty underwriter, and 2026 is another chance for us to showcase our progress. We remain focused and determined to deliver against our ambitions, and we are positive about our outlook. And with that, I will pass across to Jim, who will take you through the financials in more detail.

Thank you, Scott. Let me begin by echoing previous comments on how pleased we are with our financial results this quarter and for the year and the progress we are making to become a best-in-class underwriter. Net income for 2025 increased 141% or [ $216 million ] to $444 million as we delivered excellent financial results on a core and consolidated basis. Return on equity was 22.1%.

The full year underwriting results were strong on an attritional and as-reported basis as our diverse portfolio continues to showcase profitable, low-volatility premium growth at attractive combined ratios.

Starting with our fourth quarter results on Slide 18. We had a strong quarter, reporting operating income of $86 million or $0.70 per diluted share and net income of $240 million or $1.97 per diluted share.

Core gross written premiums grew by $134 million or 18% in the quarter versus the prior year. A continued significant driver of our growth was Accident & Health that year-over-year grew 20%. Apart from Accident & Health, core Gross Written Premiums grew at a strong double-digit rate in aggregate compared to the prior year. Turning to our underwriting results. Our core combined ratio of 92.9% was driven by strong attritional loss results, modest catastrophe losses and a couple of legacy and one-off items that affected our acquisition and OUE ratios.

The impact of these items added about 2 points to the acquisition ratio. This was partly offset by a point of favorability within OUE related to the new Bermuda tax credits and a onetime compensation benefit.

We earned Net Service Fee Income of $4 million with a service margin of 9.4%. As a reminder, Net Service Fee Income can be a bit lumpy due to seasonality trends. Investment income for the quarter was $69 million, flat to last year despite the lower asset base following the CM Bermuda shareholder buyback.

Net investment income continues to benefit from a supportive yield environment. Last, the quarter benefited from a lower effective tax rate due to Bermuda tax legislation and foreign exchange rate changes, partially offset by higher effective tax rate associated with the Armada transaction. On a go-forward basis, excluding potential changes in tax laws and foreign exchange rates, we are modeling an effective tax rate of approximately 19%.

In summary, we had a strong fourth quarter that continues to demonstrate our ability to profitably grow and create meaningful value for our shareholders.

Moving to our full year results on Slide 19. Themes here are consistent with the fourth quarter. Strong execution, disciplined underwriting and focused capital management is producing profitable growth. Core Gross Written premium, Net Written Premium and Net Earned Premium grew 16%, 19% and 18%, respectively.

Common shareholders' equity increased $532 million to $2.3 billion, resulting in diluted book value per share, excluding AOCI, growing 24% or $3.46 to $18.10.

Moving to Slide 20 and double-clicking into our underlying earnings quality. Our underwriting first focus continues to deliver strong underlying margin improvement. The attritional combined ratio chart on the left-hand side of the page strips out the impact from catastrophe losses and prior year development as these inherently vary over time.

We believe this metric is useful to examine the quality of our underwriting income. Our 91.6% core attritional combined ratio for the year represents a 1.5 point improvement versus the prior year period of 93.1%. The attritional loss ratio improved 0.8 points as enhanced risk selection lowered the attritional loss ratio by approximately 1.6 points, partially offset by 80 basis points of mix headwind.

For the year, acquisition costs increased 0.3 points, offset by 1 point of OUE improvement. OUE continues to align with our guidance of 6.5% to 7%. Looking forward, for 2026, we project a similar OUE expense ratio of 6.5% to 7%.

The right-hand side provides a bridge from our underlying earnings quality to our core combined ratio. This displays 2.8 points of favorable prior year development in the year, partially offsetting 2.9 points of catastrophe losses that are largely due to the first quarter California wildfires.

Turning to our Insurance and Services segment results on Slide 21. Gross written premium increased $106 million or 23% to $556 million in the quarter, driven by strong growth within all of our specialties. Year-to-date, gross written premium increased $473 million or 26% to $2.3 billion.

The Insurance and Services segment fourth quarter combined ratio is 93.3%. As mentioned earlier, this contains some one-off noise in the quarter, particularly on acquisition costs. Our full year combined ratio of 91.7% is indicative of the current run rate as we head into 2026.

Double-clicking on our Accident & Health book of business. As Scott outlined earlier, this book of business is strategically significant within our portfolio, acting as a volatility shock absorber, allowing us to write more volatile business elsewhere. During the year, premiums for this specialty grew 23% and have now reached almost $1 billion. It accounts for 43% of the segment's gross written premium. The areas we focus on are supported by a market environment that meets our risk-adjusted return requirements. We continue to see growth opportunities within Accident and Health.

Turning to casualty. Full year premiums have increased by 8%, driven by strong rate offset by decreased volumes. Casualty is a broad term. And overall, there are many classes we remain cautious on due to pricing challenges, notably public D&O and commercial auto, where, as previously indicated, we have substantially reduced premium and exposure.

Correspondingly, there are pockets we are seeing strong opportunity in such as general liability. In terms of pricing, our casualty writings continue to be firm, particularly on excess layers benefiting from rate in excess of trend.

Other specialties continue to see strong growth, highlighted by Surety growth in 2025. The focus on these specialties is deliberate as we continue diversifying our portfolio and writing lines that have less correlation to the wider P&C pricing cycles.

Within the marine book, cargo and hull generally saw single-digit rate decreases, while marine liability rates saw low single-digit increases. Marine war rates continue to fluctuate due to regional geopolitical tensions. Looking at energy, liability rates remain positive and averaged 5%, while upstream is more challenged.

Last, premium for our Property Specialty is strong on both a fourth quarter and full year basis. This is driven by growth from our international business, where we are writing select opportunities, mostly in the U.K.

This business has a controlled volatility profile with a focus on lower limit residential and small, medium-sized enterprise properties protected by excess of loss reinsurance for larger events.

Moving to our Reinsurance segment results on Slide 22. This quarter, gross written premium increased $29 million or 9% to $341 million. We saw growth in casualty offset a decrease in property premiums with other specialties broadly flat.

On a full year basis, gross written premium increased by 3%, while on a net basis, premiums written increased by 2%. The combined ratio for the quarter decreased by 1.1 points to 92.1%, driven by a lower OUE ratio, while the full year combined ratio of 91.8% increased versus the prior year, driven by lower levels of favorable prior year development.

Double-clicking into Casualty Reinsurance. Gross written premium increased 7% for the year. At 1/1 renewals, casualty reinsurance saw pricing in line with expectations as underlying rate performance remained stable. The January renewals did not see any deterioration in terms and condition.

This quarter, other Specialty gross written premiums was broadly flat and up 4% for the full year. The reduction is the result of reduced aviation premiums. January renewals saw flat pricing for both excess of loss and pro rata treaty classes in aviation, while direct and facultative rates for major airline renewals saw 10% to 50% increases in the fourth quarter with U.S. airlines seeing the greatest rate changes.

We welcome the firming pricing environment as we seek further rate increases to achieve rate adequacy. Elsewhere in other specialties, credit and bond pricing continues to be pressured, stemming from favorable historical results and ample market capacity.

Within property reinsurance, premiums were down in the quarter and in 2025. At 1/1, we saw U.S. property catastrophe reinsurance rates decreased roughly 15% to 20%. International property catastrophe reinsurance pricing also saw declines at 1/1 with some accounts failing to meet rate adequacy benchmarks. In response, we came off certain programs to reallocate capital to better opportunities.

Slide 23 shows our catastrophe losses versus peers and the reduction in the volatility of our portfolio. Following portfolio actions taken before 2022, we have materially decreased our catastrophe exposure in order to deliver more consistent returns to our shareholders. We now boast a 3-year track record of low volatility in our combined ratio due to catastrophes.

At 1/1 renewals, we took the opportunity to further strengthen our risk transfer of property catastrophe risk by purchasing a new property aggregate program covering select property catastrophe events. This cover became available with strategic partners at attractive levels based on our underwriting track record.

For 2026, our new aggregate cover attaches at $90 million of accumulated catastrophe losses throughout the year. This structure provides meaningful protection against the frequency and clustering of small- to medium-sized events.

Furthermore, our 2026 combined retrocession protection is more efficient than 2025, particularly in managing our volatility. Importantly, we were able to achieve this improved efficiency at a lower overall cost than the prior year while also increasing the total limit purchased.

Taken together, these actions enhance the resilience of our earnings and capital position and provide us with greater confidence in delivering our financial targets.

As of February 1st, we purchased multiline aggregate reinsurance coverage with $100 million annual limit designed to limit retained underwriting volatility in key lines of business of property reinsurance, aviation, marine, energy, among other perils.

Catastrophe losses in the year represented 2.9 points of our combined ratio and were largely driven by the first quarter California wildfires. We have a comparatively low loss ratio, demonstrating the benefits of our diversified portfolio. Property catastrophe premiums are just 5% of the overall business mix.

Moving to Reserving. Our strong history of prudence is shown on Slide 24. For the quarter, core favorable prior year development was $15 million and $22 million on a consolidated basis. This marks the 19th consecutive quarter of favorable prior year development.

Our track record of consecutive favorable releases significantly exceeds the average duration of our insurance liabilities, demonstrating our prudent approach to reserving. Additionally, we show here the strong level of protection we have on each of our 3 loss portfolio transfers that were completed in 2021, 2023 and 2024. In short, we have significant limit remaining on each of these treaties.

Turning to our strong investment results on Slide 25. Net investment income for the year was $275 million, down slightly from the prior year period as a result of a lower asset base following the first quarter CM Bermuda transaction settlement. This quarter, we reinvested over $500 million.

New money yields were in excess of 4% as we increased cash and treasury holdings in advance of our upcoming preferred retirement. Our portfolio continues to perform well. There were no defaults across the fixed income portfolio. We are committed to our investment strategy that focuses on high-quality fixed income securities.

81% of our investment portfolio is fixed income, of which 98% is investment grade with an average credit rating of AA-. Our portfolio duration was 3.2 years, up from 3.1 years at the end of the third quarter.

Moving on to our Slide 26, looking at our strong and diversified capital base. Our fourth quarter estimated BSCR ratio increased to 247%, up 22 points in the quarter following the Armada MGA sale. On a pro-forma basis, accounting for the Series B preference share redemption, the BSCR ratio is 232%.

Evidencing the strength of our capital position, we provide a stress test scenario for a 1 in 250-year PML event. Post this hypothetical event, our BSCR ratio is strong and above rating agency capital model targets.

Looking at our balance sheet on Slide 27. We continue to have a strong balance sheet with ample capital and liquidity. During the quarter, the leverage ratio fell to 28%, driven by an increase in shareholders' equity. Our leverage levels remain within our target and will fall to 23% following the redemption.

As Scott mentioned earlier, today, we are announcing a common share buyback intention of $100 million of shares over the next 12 months. We believe this action will be highly accretive to ongoing shareholders.

Lastly, we view our balance sheet to be undervalued in relation to the consolidated MGAs, which we own, namely IMG, that is a core component of our future offering. Our book value now includes the sale proceeds of Armada. In the first quarter, our book value will increase by a further $25 million related specifically to the completion of Arcadian.

With this, we conclude the financial section of our presentation. This quarter saw a continuation of strong double-digit growth in our top line that delivered a Core Combined Ratio in the low 90s with continued attritional loss ratio improvement. This is our eighth consecutive quarter of attritional loss ratio improvement.

Operating return on equity for the quarter of 17.1% contributes to a full year operating return on equity of 16.2%. 2025 marks another year with a strong return on equity at or above our 12% to 15% across the cycle target. We've built a track record of delivery. This quarter's results further validate the significant progress we have made to becoming a best-in-class specialty underwriter.

With that, I hand the call back over to the operator. We can now open the lines for questions.

[Operator Instructions] And our first question comes from Michael Phillips with Oppenheimer.

Congrats on the quarter and the year. I know you guys are doing. First question would be kind of a summary, I think, of what Scott opened with and that Jim kind of commented on. Scott, you said tougher market conditions in 2026, but maybe maintaining the current levels of profitability.

And then Jim was talking on insurance about, I think you said like the 91.7%, 91.8% is a good run rate. And obviously, insurance had an elevated acquisition cost for the year. So I guess, first off, just to confirm for insurance, that 91.7%, 91.8%-ish number, is that what you mean, not much pressure on that over the next year?

And then I guess, because the acquisition costs, maybe if you could speak specifically to, I guess, what you call the attritional loss ratio, I think in the year, it was 60.8%. So how do you see that 60.8% for insurance trending over the next year, given your comments?

Mike, thank you. Appreciate the questions, and thanks for your opening comments. Look, the way I think that we're thinking about '26 is in line with what I said, which is, look, we recognize that there are parts of the market that will be tougher. I think Jim gave an example of that in property [ cat ] but he also gave a context for us, which is that's sort of 5% of our overall premium.

So I think the way that we're thinking about '26 is where we don't see the opportunity to make a return commensurate with the risk. The great news, Mike, is that we can move capital quickly around the group and seize other opportunities, which then takes us, I think, to a wider portfolio, where I genuinely believe both from the lines of business that we write, Accident and Health, Surety, et cetera, we are able to deploy capital in areas where the rating pressure is not the same and is less correlated, if you like, to the wider P&C.

And in addition to that, I do think that the distribution focus we have on MGAs working with what I would call very specialist niche partners who really give true dedicated specialist advice to customers. I do think there's partial insulation from some of the wider market pressures on general rate.

So look, I think that's sort of how we're thinking about '26. I think importantly, Q4 and sort of opening of Q1 in Jan was in line with our expectations. So there was no sort of negative surprises. Things like aviation that Jim mentioned for us, I think I highlighted that, Mike, on my Q3 call, I said aviation need rate. I think everyone in the market have been saying that.

And we carried high on average, high double-digit teens rate in aviation. More to do, but I think that's really a good step forward. So look, for us, I think we are off and running in '26 in a good space. I think that the combined ratio number that you mentioned for insurance, look, indicatively, that's a good run rate as we go in to 2026. We'll try and do better, I promise you.

But we think that's a good level of return for the risk that we're taking. And I think your comment on loss ratio, I think, look, we're not going to trade margin where we don't see return for the risk. The great news, though, is we've got a really strong pipeline of growth opportunities that we'll be very disciplined about in evaluating, but we believe that we've got other opportunities for our capital.

So look, I think that gives you, hopefully, my quite a comprehensive answer. I'll pause in case Jim wants to add anything else to that.

Yes. So yes, I agree with everything that Scott highlighted. I think those are good comments. I think the biggest thing, Michael, that I would point you to as you think about us and I think the number that Scott highlighted and that I highlighted earlier is the right number to begin with. I'd say there's probably potentially when you think about us on a go-forward basis, maybe 0.5 point that you could kind of shift over time, plus or minus related to mix and how it actually comes in over kind of 2026. I would not be confused by that. One of the comments that I highlighted inside the quote was kind of the component of mix, right? And that we have continued to improve on a loss ratio performance basis, inclusive of that mix element.

That's actually a real positive in total because it means that we're getting more leverage actually on our premium to surplus ratio. So different things kind of come in at different ratios. But in short, what I would say is I'd start exactly with that 91.7%. And I would think depending on how mix comes in over the year, where we outperform, where we see the best returns from a capital perspective, that the right way to think of that is maybe plus or minus kind of 0.5 point as a starting position from that kind of given just how things come together.

Okay. That's very helpful, both of you. Appreciate it. I guess next question is on the fee income side and just trying to think about 2026 here. I guess, first off, can you say of the 2025 number, I think the $42 million, how much of that was Armada?

So I would tell you that generally speaking, you're in a range of about $26 million inside there. I would think about it as like a run rate of about $30 million with potential of kind of post completion of everything, I think you're looking at about a run rate base expectation of around $40 million.

Sorry, Jim, that $40 million is what, what do you mean by that.

That include the 2 bolt-on acquisitions, which won't be up to full power, Mike just to be very clear, right? So the guidance that we've given for '26 is that obviously we'll be focused on integration. As an example, World Nomads won't complete until later on this year. But our aim when they're up to full power and fully integrated within IMG is they will be $40 million and hopefully plus of EBITDA. We'll try and do better.

In addition to that, for World Nomads, which is obviously underwriting business, we will obviously channel that across over time into a wider Accident & Health underwriting division as well. So hopefully, that knits that together for you as well, Mike.

It does. Yes. I guess that's what I was trying to get at. So 2026, we'll see probably the 30-ish that you're guiding to, obviously, it is decline from '25 level, but that does not include the 2 acquisitions, right? So you won't see any benefits from, say, World Nomads until 2027?

Not materially, Mike. And that's why, look, I mean, plus or minus 1 or 2 perhaps, but not materially. That's why we're trying to be explicit in the guidance going forward.

Okay. No, perfect. Just want to clarify. And then I guess just last one for me for now is on just the growth. And you've talked a lot about how you've got these lines that are contributing more than 60% in the quarter of the year was from A&H and Surety.

I guess if we can focus on Surety for a second. I get a lot of questions on this of how sustainable that is over the next 2 years. How much of your Surety business in 2025 came from either government infrastructure growth or from data centers that was a big boom in 2025 and therefore, how much of that is sustainable over the next year or 2?

I'll make a comment and then Jim can jump in, Mike. So look, I think the sort of data center aspect and stuff like that is a red heading. So look, when we think of the profile of what we have, we view it as sort of pretty sustainable on a go-forward basis, Mike. So we're not projecting any sort of falloff for the 2 areas that you've highlighted, although I recognize within the wider marketplace that those are absolute pressures. But Jim, anything you want to add to that?

Yes. I would just say that minimal amounts of kind of our book follow that. I mean, we feel pretty good about where we've entered. Again, we're kind of at the early stages, I would say, in terms of where some of our relationships are inside of that, not from how long we've been partners or other, but we're at, I would tell you, kind of more the early innings of kind of the total build-out from a premium perspective on the Surety side versus necessarily kind of our longer-term kind of run rate stabilized portfolio. So I think we've got some nice tailwinds there and feel pretty good about the growth in 2026.

And Mike, just to amplify the point that Jim made the just now, which I appreciate is a wider than Surety comment, which is, look, the reason we've tried to give some additional disclosure, which we started at Q3, particularly around our MGA relationships is I think you can really see the difference between number and premium from what I would term newer MGAs.

Of course, that's not an exact science, which I completely get. But I think you can see that we're being thoughtful and cautious in newer relationships. And so just to amplify the comment that Jim made, that's really the slide that shows we have potential from existing partners as well as a healthy funnel of opportunities to work our way through from a diligence perspective.

Our next question comes from Andrew Andersen with Jefferies.

On the insurance segment, I think you talked about casualty growing 8% for the year. I think that's about 30% of the overall segment. Could you maybe just talk a bit more about how you're seeing kind of the rate environment into '26? Are you thinking still kind of staying firm or harden further? What is the outlook for casualty insurance?

Yes. So thanks for the question. Generally speaking, relative to the specialties in the areas where we focus, we think -- and what we're seeing is that rate is broadly moving in line with trend. We're seeing relatively disciplined activity, people being thoughtful about the lessons that I think we learned kind of in the 2019, '20, '21 kind of time period and some of the surprises.

You've kind of just seen some of the development and other components kind of work their way through the books on those things over the last year. And I think it was more than what folks expected. And so I think people are looking at the environment with a healthy thought process, and we feel pretty good about where we're at and what we expect kind of going forward.

And Scott, I think you talked about attracting some more talent and doing some more senior hires. Where have some of these focus areas been on? Is it kind of specific lines of business where you're seeing growth opportunities?

Right across the firm, Andrew. So we're obviously attracting a underwriting talent to the organization, but I would also say we're attracting sort of functional talent, et cetera, as well as we sort of strengthen our capabilities. The great news is we're attracting people from organizations with good caliber and we're attracting really high-caliber individuals. That's very different, Andrew, to when I first arrived when obviously, the company was in quite a different position. Also, and I want to just sort of emphasize this point as well, really pleasingly, the talent from within is also growing and prospering. And so we feel in a really good spot. When we are -- really simply, when we're advertising roles, we've got a really good internal pool to think about and consider, and we're really attracting external people to the organization. I think we've caught people's attention.

And maybe last one, back to insurance. The retention rate has been improving over time. I guess, Jim, do you still see some more opportunity to retain a bit more business here into '26 and '27? And is that specific on any one line?

Yes. I mean we continue to see opportunity there. I think what I would highlight to you is more a risk management prudence mindset. We start with a really thoughtful kind of composition. We make sure that we get to know our partners as well as kind of the components in the market. And then we -- through time, as we have everything kind of in place, the data feeds, the interactions, just a really great way of kind of forecasting for in the future that we feel like gives us kind of a high confidence, then you see us gradually kind of increase our net in those components.

And so that's a trend again that I think is going to continue as we move forward in the future, but it's going to be done with where we see the appropriate returns on capital. It's going to be done with the same type of risk management and prudence that we've kind of taken to date.

So we feel good about it. And yes, we think there's additional opportunity there, but it's going to be prudent and disciplined.

Yes. And Andrew, I just want to amplify what Jim said at the end. Look, we think -- I think I called it, it makes a lot of sense when I gave my overview. But we think that approach really is the hallmark of sort of our discipline and should give our investors confidence and comfort. We're not chasing growth right? We could turn taps on if we wanted and take more growth. We think our approach is based around things like underwriting philosophy, getting to know people, data sharing.

And we just think that's a really sensible approach. But there's no question we've got potential within the pipes, and we've got new potential to evaluate outside the pipes, but we will be disciplined.

[Operator Instructions] We'll go next to Mitchell Rubin with Raymond James.

This is Mitch on behalf of Greg Peters. Congratulations on the quarter and the year. So with roughly 2/3 of premiums now coming from insurance and services, how do you see that mix evolving over the next few years? And is there a longer-term target for where you'd like that balance to settle?

Mitch, thanks for your comments. Very kind, and thanks for your question as well. Look, I think we've given a very strong steer that we want to grow insurance over reinsurance. I think it fits within our sort of strategic ambition of lower volatility, but I wouldn't want that misinterpreted, which is why I elaborated that reinsurance is a very important part of our armory when we approach the market.

Not only does it give us flexibility in lines of business to come at them in different ways, but it's actually an incredibly useful tool in working with our MGAs. So I really want to make sure that, that message lands because it's really an important part of how we do business.

We haven't given a specific target, and I'm loath to do that. And the reason for that is because it can ebb and flow. But I would say to you that proportionately, insurance is growing much quicker than reinsurance. You can see that in the numbers that we disclosed this year. Insurance and services grew gross written premium 26%, reinsurance 3%. Those can move around quarter-on-quarter, sometimes year-on-year. But I think indicatively, we expect the trend to increase.

And just on the $100 million buyback, how should we think about the cadence? Is that going to be front-loaded, more evenly paced or opportunistic based on valuation?

So look, I'll kind of -- we'll tag team this a little bit. What I would highlight is likely to be a little bit kind of opportunistic, but also with we feel like we're -- we feel we're in a really attractive position from a market perspective or other.

We see a lot of value in the company. We think that there's a good value trade here for our ongoing shareholders. And so we're going to be disciplined and thoughtful about that. But we're going to take a programs [ mount ] and we'll see how things kind of trade from a market perspective. So some opportunistic, but likely to play out throughout the year with potentially some front-loading kind of given where things are at today.

Yes. Look, the same mix actually, which is, look, I think the reason we said over 12 months is want to give ourself some flexibility. I think that's a good thing. The most important part of it is we think it's good for shareholders. And therefore, depending on where the price moves, it could be even better for shareholders.

There's no liquidity constraints in terms of when we might do it. The great news is Jim is get the money in the right place to do it when we need to do it, and we'll be opportunistic. And if that means it's more front-loaded than back loaded, then we are very happy to take that. We'll do what's right for shareholders.

And this now concludes our question-and-answer session. I would like to turn the floor back over to Scott Egan for closing comments.

Yes. Listen, thank you very much, everyone, for joining. Obviously, the full year results is a very important one for SiriusPoint. I really just want to end with a few key takeaways and messages from our results.

Number one, this is our third year of operating ROE improvement, and there really is a strong performance momentum within the organization. That's number one.

Number two, our attritional loss ratio improvement, and therefore, our quality of earnings continues to improve year-on-year. We are very proud of that. And I think that's a really important measure for the business as we go forward.

Three, there is strong growth momentum within the company, and I think we've outlined our disciplined approach to that. Our book value has increased by 28% in the year. That's added significant value for our shareholders. And we are positioned very well from a balance sheet perspective to take opportunities as they present themselves.

So in summary, the future is bright for SiriusPoint. Thank you very much for joining. We appreciate your questions and your attendance. Have a good day.

Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. You may disconnect your lines, and have a wonderful day.

Good morning, ladies and gentlemen, and welcome to SiriusPoint Third Quarter 2025 Earnings Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded, and a replay is available through 11:59 p.m. Eastern Time on November 14, 2025. With that, I'd like to turn the call over to Liam Blackledge, Investor Relations and Strategy Manager. Please go ahead.

Thank you, operator, and good morning or good afternoon to everyone listening. I welcome you to the SiriusPoint Earnings Call for the 2025 3rd quarter and 9 months results. Last night, we issued our earnings press release, 10-Q and financial supplements, which are available on our website, www. seriuspt.com. Additionally, a webcast presentation will coincide with today's discussion and is available on our website.

Joining me on the call today are Scott Egan, our Chief Executive Officer; and Jim McKinney, our Chief Financial Officer. Before we start, I would like to remind you that today's remarks contain forward-looking statements based on management's current expectations. Actual results may differ. Certain non-GAAP financial measures will also be discussed -- many good uses the non-GAAP financial measures and its internal analysis of our results of operations and believe that they may be informative to investors, engaging the quality of our financial performance and identifying trends in our results.

However, these measures should not be considered as a substitute for or superior to the measures of financial performance prepared in accordance with GAAP. Please refer to Page 2 of our investor presentation and the company's latest public filings with the Securities and Exchange Commission for additional information. I will now turn the call over to Scott.

Thanks, Liam, and good morning, good afternoon, everyone. Thank you for joining our third quarter and 9 months 2025 results call. The third quarter was another successful quarter of delivery for SiriusPoint. Our strong underwriting performance deliberately targeted growth, the announcement of 2 MGA disposals, insurer reinsurer of the year at the insurance into U.S. honors and an upgrade to positive outlook from S&P means that there's a lot to be pleased about. Our ambition remains the same. Keep building on the progress and momentum whilst targeting sustained levels of best-in-class performance.

The third quarter was another step a longer road on that journey, and we remain completely focused with no room for complacency. In terms of specifics, our core combined ratio of 89.1% delivered an 11% increase in underwriting income versus last year, aided in part by no catastrophe losses in the quarter. We achieved a strong operating return on equity of 17.9%, significantly ahead of our across-the-cycle 12% to 15% target range.

More importantly, our year-to-date operating return on equity of 16.1% is still outperforming a range despite the heightened first half losses from the California wildfires and aviation. Therefore, we would not describe the first 9 months as being quiet as in fact, our catastrophe losses are over $50 million higher than prior year. This puts our 16.1% operating return on equity into contact and is an important proof point of the improvement in the quality of earnings.

In addition to our strong financial delivery, the third quarter also saw significant execution on the rationalization of our MGA investments. we announced agreements for the sale of our 100% stake in Armada and a 49% stake in Arkadin for combined total proceeds of $389 million valuing them together at around 15x EBITDA. Upon closure of these deals, over $200 million of off-balance sheet value will be recognized in our book value, representing a per share increase of approximately $1.75.

Finally, the quarter also saw our third outlook update of the year with S&P upgrading our outlook to positive, joining the previous upgrades from A.M. Best and Fitch. We have added a new slide this quarter linked to delivery against our ambition to become a disciplined underwriter with a low volatility portfolio. Slide 10 shows our combined ratio volatility against our peers over the past 2 years. This demonstrates the significant progress we have made in managing the volatility of our underwriting, both at an individual risk level and across the portfolio.

We talk often about our disciplined approach to portfolio management of risk. And as you can see, since our turnaround and reshaping, we now rank amongst the top performers over the past couple of years. Our aim is to continue to build this track record. We have now delivered 12 consecutive quarters of underwriting profits and 18 consecutive quarters of favorable prior year development. I also want to spend a few moments talking about the strong top line momentum we have within the company.

Gross premiums written grew double digit again in the quarter at 26% year-over-year. This is now our sixth consecutive quarter with a double-digit growth profile. This was driven in large part by strong growth within our insurance and services business and particularly from our Accident and Health, Surety and Attritional Property books of business. In particular, I want to highlight our Accident and Health division. This business acts as a volatility shock absorber within the wider underwriting portfolio, given its short tail and low volatility characteristics.

It also got a long track record of high capital returns. Our action in the Health division allows us to take disciplined risk in other areas, but still remain within our guiderails to achieve a low volatility portfolio overall. It also has the added advantage of being less correlated to wider P&C pricing cycles. This division accounts for almost $1 billion of gross premiums written on an annualized basis and forms a significant part of our company. Elsewhere, within our Insurance and Services business, we are seeing strong growth from Surety, which like Accident & Health, is less correlated to wider P&C pricing cycles.

Premiums here are derived via the MGA distribution channel. Following specifically to look at the premium we write via the MGA distribution channel. Again, we have included an additional slide in the quarter to share more details on our approach. Slide 13 focuses on the length of the relationship linked to the derived premium. In short, we are more careful with newer partners. Whilst they make up approximately a third by number, we only make up 9% of our overall MGA premiums.

We tend to have higher premium volumes with more mature partners where we have gained greater historical experience. Around 90% of our overall portfolio comes from partners who we have had a relationship with for 3 years or more. We think this seasoning is an important part of our approach to risk taking. Our selection process, which declined around 80% of opportunities presented six other partners who want to form deep, long-term relationships.

Looking at our existing relationships. In the last year, we have continued writing business with 97% of the partners we have previously onboarded over a year ago. This demonstrates our ability to seek out those partners who we will work with on a long-term basis and those who share our underwriting and risk philosophies. In addition to our cautious approach to risk taking in the early days of a relationship, we also apply the same logic to our reserving.

Under a risk-based approach to reserving newer relationships are generally reserved above pricing projections to account for uncertainty from limited performance experience. Lastly, we have profit sharing features in place for around 87% of our MGA partners driving alignment of interest linked to underwriting performance.

Coming back briefly to the sale of our MGA investment. As I mentioned earlier, this quarter saw us reach agreements to sell 2 MGA investments, Amada and Acadian. Importantly, we also signed long-term capacity deals within both until 2030 and 2031, respectively, on existing economic terms. Amada made, the most material to our book value remains on track to close in the fourth quarter, and Acadian remains on track to close in the first quarter of next year. We reaffirm our commitment to a long-term ROE across the cycle target of 12% to 15% post these disposals.

ING is now our only 100% owned MGA, generating roughly $50 million of net service fee income on an annual basis. As a reminder, the carrying value on our balance sheet is $70 million. ING is a key part of our wider accident inhaled ecosystem generating around 25% of the Accident and Health underwriting divisions premium as well as a healthy MGA margin in its own right.

We are excited about the future of ING and announced last week the appointment of a new CEO, Will Nihan, who joined us from Travelex. Finally, our capital remains strong, and our third quarter BSCR ratio improved to 226%, which is within our target range. As we continue to deploy capital to support the organic growth opportunities of the business. Of course, we expect this to increase post the closing of the MGA transactions I have mentioned. As we think ahead on capital given these sales, we are taking a look at our capital stack and more specifically, our hybrid instruments.

When we conducted the buybacks related to the CMIG shareholder agreement, we increased our leverage. Jim will cover this in more detail, but with the Series B preference shares having a rate reset coming up in February '26, we have an opportunity to reduce leverage to pre CMIG agreement levels whilst reducing our financing costs meaningfully.

Before I pass across to Jim, I also wanted to highlight that last month saw the company earned another award this time, Insurer Reinsurer of the Year at the U.S. Insurance Inside or Honors Awards. This follows a program insurered award, which we received in May at the Program Manager Awards. Whilst they don't mean anything in and of themselves, I think we can take them as further proof points of our progress. So I will finish what I always do. I'm incredibly proud of the team and the commitment, desire and determination they have shown again so far this year. As I reflect back on my [indiscernible] anniversary as CEO, our progress is strong. but it could not be done without our biggest asset, our people.

I am grateful to all of them for what they have done and what they do every day. And I am excited about our future. Our collective aim is to continue our upward trajectory to become a best-in-class specialty underwriter. With that, I'll pass it cross to Jim, who will take you through the financials in more detail.

Thank you, Scott. Turning to our third quarter results on Slide 16. In the third quarter and for the first 9 months of the year, we delivered excellent financial results on a consolidated basis and in each of our segments. Our diverse portfolio continues to showcase profitable premium growth with low volatility and highly attractive line of business. That 89.1%, the core combined ratio is strong and broadly in line with the previous year. The combination of higher premiums, a strong core attritional loss ratio, lower expense ratio and no catastrophe losses produced core underwriting income of $70 million. This is an 11% increase from the third quarter of 2024 and our 12th consecutive quarter of positive income.

These items are a testament to the team's strong execution, disciplined underwriting and focused capital management. Moving to net service fee income. We benefited from a 22% increase in year-over-year service revenues as well as net service fee income increasing 47% to $10 million. The investment result is $73 million. It includes the full impact of the actions taken during the first quarter to support our repurchase activities. Net investment income continues to benefit from a supportive yield environment and remain on track with our full year guidance of net interest income between $265 million and $275 million.

Operating net income is $85 million. This excludes nonrecurrent items such as foreign exchange losses. On a per share basis, this increased by 41% to $0.72. We previously referred to this metric as underlying net income, but have remained it this quarter to better reflect the nature of this metric as the business moves past is repositioning history. Net income for the quarter was $87 million, a strong year-over-year improvement from $5 million last year.

In summary, our third quarter results demonstrate our ability to profitably grow a low volatility portfolio and create meaningful value for all of our stakeholders. Moving to our 9-month results on Slide 17. Themes are consistent with the third quarter. Strong execution, disciplined underwriting and focused capital management is producing profitable growth. Gross written premium, net written premium and net earned premium grew 16%, 19% and 18%, respectively. Growth was particularly strong in the third quarter, we expect fourth quarter premiums to be more in line with the growth produced on a year-to-date basis.

Common shareholders' equity increased $273 million to $2 billion, resulting in diluted book value per share ex AOCI growing 13% or $1.83 to $16.47.

Moving to Slide 18 and double clicking into our underlying earnings quality. Our underwriting first focus continues to deliver strong underlying margin improvement. The attritional combined ratio chart on the left-hand side of the page strips out the impact from catastrophe losses and prior year development as these inherently vary over time. We believe this metric is useful to examine the quality of our underwriting income. Our 90.9% core attritional combined ratio in the first 9 months of the year represents a 1.8 point improvement versus the prior year period of 92.7%.

All facets of the ratio improved. The attritional loss ratio improved 0.9 points. The acquisition cost improved 0.2 points and the OUE improved 0.7 points. Important to note we continue to benefit from scale from our earned premium growth. For the full year, we remain comfortable with our previously stated expense ratio expectation of 6.5% to 7%. The right-hand side provides a bridge from our underlying earnings quality to our core combined ratio. This displays 3 points of favorable prior year development in the first 9 months, partially offsetting 3.5 points of catastrophe losses that relate entirely to the first quarter California wildfires.

Turning to our Insurance and Services segment results on Slide 19. Gross written premium increased $186 million or 49% to $562 million in the quarter, driven by strong growth within all of our specialties. Year-to-date, gross written premium increased $367 million or 26% to $1.8 billion. The Insurance and Services segment achieved a combined ratio of 90.1%. This is a 2.3 point improvement from the prior year quarter. This was driven by a 2.3 point decrease in the loss ratio and a 2-point decrease in other underwriting expenses, partially offset by a 2-point increase in the acquisition cost ratio.

The improvement is due to improving risk selection and a shift in business mix. Double-clicking on our Accident & Health book of business. A&H provides us with a stable source of underwriting profit and a strong double-digit return on capital. During the first 9 months of the year, premiums for this specialty grew 24% and now accounts for 45% of the segment gross written premium. For the areas we focus on, the pricing environment continues to meet our risk return requirements. We continue to see growth opportunities within this specialism.

Turning to Casualty. Year-to-date premiums have increased by 4%, driven by strong rate offset by decreased volumes. In the first half of the year we allocated capital towards other opportunities that have more attractive underlying margins. Subsequently, in the third quarter, we saw growth opportunities within select general liability sub-classes. Overall, there are many classes we remain cautious on due to pricing challenges, notably public D&O and commercial auto, where as previously indicated, we have substantially reduced premium and exposure.

In terms of casualty pricing, we continue to benefit from rate in excess of trend, particularly in excess casualty that has seen mid double-digit rate increases. Our priority is the bottom line over top line. If conditions change, we will not be afraid to take decisive action to ensure appropriate underwriting margins. Other specialties continue to see strong growth, highlighted by Surety and Environmental. Both of these lines have seen strong year-over-year and quarter-over-quarter increases in premiums.

Within Marine and Energy, rate trends are similar to those described in the second quarter. Cargo and haul generally saw single-digit rate decreases. Rates from marine liability are firmer, ranging from flat to low single-digit rises. Energy liability rates remain positive and average 5%. Last, premium for our Property specialty are strong on both a third quarter and year-to-date basis. This is driven by growth from our international business, where we are writing select opportunities mostly in the U.K. This business has a controlled volatility profile with a focus on lower limit, residential and SME properties protected by XL reinsurance for larger events.

Moving to our Reinsurance segment results on Slide 20. This quarter, gross written premium decreased by $5 million or 2% to $310 million. We saw growth in Casualty offset by a decrease in aviation premium with property premium broadly flat. Trends were similar on a net written premium basis. On a 9-month basis, gross written premium increased by 1%, while on a net basis, premiums written decreased by 3%. The combined ratio for the quarter increased by 3.3 points to 87.9%. The result was driven by a 1.2 point improvement in the acquisition cost ratio offset by a 4.4 point increase in the loss ratio largely the result of decreased favorable prior year development.

Double-clicking into casualty reinsurance. Gross written premium increased 7% in the quarter. It is down 2% for the 9 months. Casualty reinsurance continued to benefit from positive rate at a key to trend. Aligned with our fourth quarter 2024 guidance, we reduced exposures on structured deals and certain casualty classes at 1/1. This is a result of underwriting discipline and our ability to allocate capital to the best opportunities.

Other Specialties saw gross written premium decreased by 10% this quarter. Year-to-date, we were up 6%. The reduction is the result of reduced aviation premium. We remain cautious on this specialty as we see further rate increases to achieve rate adequacy, particularly with major airlines, a majority of major airline renewals occur in the fourth quarter. Our capital allocation in this area will depend on rate achieved and price adequacy. Elsewhere and other specialties credit and bond pricing continues to be pressured stemming from favorable historical results and ample market capacity.

Within Property Reinsurance, premiums were flat in the quarter with softening in excess of loss largely offset by an increase in demand for surplus relief via quota share. Here, carriers are driving additional demand, specifically for secondary parallels coverage following market expansion resulting from the improved market conditions and regulatory environment. For the first 9 months, premiums are roughly flat with reinstatement premiums from the California wildfires offsetting premium reductions. We will continue to monitor rate adequacy and property reinsurance and be disciplined capital allocators.

Slide 21 shows our catastrophe losses versus peers and the reduction in the volatility of our portfolio. Following portfolio actions taken in 2022, we have materially decreased our catastrophe exposure in order to deliver more consistent returns to our shareholders. The charts show how we reduced our catastrophe losses in 2023 and '24 and have continued on this path in 2025. Catastrophe losses in the first 9 months represent 3.5 points of our combined ratio and were largely driven by the first quarter, California wildfires.

We have a comparatively low loss ratio, demonstrating the benefits of our diversified portfolio. I would like to take a moment on behalf of all of SiriusPoint to send our thoughts to all those who have been affected by Hurricane Melissa earlier this week. At present, we expect this to be a manageable loss with our net exposure in the affected regions around $10 million.

Moving to Reserving. Our strong history of [indiscernible] is shown on Slide 22. Favorable prior year development in the quarter stood at $9 million for the core business versus $30 million in the prior year quarter. It is important to consider our consolidated result here as this includes the business we have put in runoff. We had favorable prior year development on a consolidated basis of $9 million, marking the 18th consecutive quarter of favorable prior year development.

Our track record of consecutive favorable releases well exceeds the average duration of our insurance liabilities of 2.8 years, highlighting our prudent approach to reserving. Additionally, we show here the strong level of protection we have on each of these loss portfolio traffics that were completed in 2021, 2023 and 2024. Turning to our strong investment result on Slide 23. Net investment income for the first 9 months of the year was $206 million, down slightly from the prior year period as a result of a lower asset base following the settlement of the CM Bermuda transaction in the first quarter, we reinvested over $900 million this quarter, with new money yields continuing to be in excess of 4.5%.

The portfolio continues to perform well, and there were no defaults across our fixed income portfolio. We remain committed to our investment strategy, which focuses on high-quality fixed income securities. 83% of our investment portfolio is fixed income of which 99% is investment grade with an average credit rating of AA-. Our overall portfolio duration remained at 3.1 years, while assets backing loss reserves remain fully at Match and are at 2.8 years.

Moving on to Slide 24, looking at our strong and diversified capital base. Our third quarter estimated DSCR ratio increased 3 points to 226%. Our capital position remains strong and contains sufficient prudence as shown by the stress test scenario of a 1 in 250-year PML event.

Moving on to our balance sheet on Slide 25. We continue to have a strong balance sheet with ample capital and liquidity. During the quarter, the debt-to-capital ratio fell to 23.6%, driven by an increase in shareholders' equity from net income offset by weakening of the U.S. dollar, Swedish krona exchange rate, increasing the value of our debt issued in corona. Our debt to capital levels remain within our targets. We continue to have strong liquidity levels, including $662 million of liquidity available to the holdco following the final payment of $483 million to CM Bermuda in the first quarter.

As a reminder, in the first half of the year, both AM Best and Fitch revised our outlook to positive from stable while Moody's and S&P affirmed our ratings. During the third quarter, S&P also revised our outlook to positive from stable. We believe our balance sheet continues to be undervalued in relation to the consolidated MDAs, which we own. During the quarter, we announced the sale of Armada, which will increase book value by roughly $180 million upon close. We also announced the sale of our 49% stake in Arcadian. This will increase book value by roughly $25 million to $30 million upon flows.

Following the sale of these MGAs, we reaffirm our commitment to producing 12% to 15% ROE across the cycle. We expect to use the proceeds to redeem the $200 million of preference shares that we have outstanding at their upcoming rate reset. On a pro forma basis, using the proceeds from the sale to redeem the preference shares would reduce our leverage ratio, including preference shares from 31% to 24%. This will enhance our credit profile and reduce our cost of debt.

With this, we conclude the financial section of our presentation. This quarter saw a continuation of strong double-digit growth in our top line while delivering a core combined ratio in the high 80s that contains continued attritional loss ratio improvement. This is our seventh consecutive quarter of attritional loss ratio improvement, operating return on equity for the quarter of 17.9% contributes to a 9-month operating return on equity of 16.1%. We are on track to deliver another year with a strong return on equity at or above our 12% to 15% across the cycle target.

We have built a strong track record of delivery, and this quarter's results further validates the significant progress we have made on our journey to becoming a best-in-class specialty underwriter. With that, I hand the call back over to the operator. We can now open the lines for questions.

[Operator Instructions]

Our first question comes from the line of Michael Phillips with Oppenheimer & Company.

First off, congrats on the quarter, and I appreciate the slide -- the new slide, Slide 13, is nice to see. I'm so glad you guys added that. Question on, I guess insurance and kind of to Jim's last couple comments on the attritional loss ratio improvements. You've taken it nicely down from mid-60s to now teasing 60, low 60s. And I assume part of that -- a good part of that is because of the mix shift in the company in that segment. I guess, as we think about continued probably mix A&H, Surety and different things that you're really growing in and think about that line item for the attrition of accident loss ratio, it seems like are we teasing to get below 60% as we look forward.

Michael, thank you very much for the question, and thanks for your comments at the beginning as well. Jim, you can jump in a second as well. Look, I think, Michael, the way I think about it is, obviously, we've done a lot of the hard work over the past few years, which was really reshaping the portfolio. Obviously, because of the profile of our distribution sometimes when we win a new MGA relationship that can see things sort of move, but I wouldn't expect any material movements, if I'm honest with you, as we sort of look out and over.

Our ambition is always to is always to reduce it, obviously, all of our ratios. But obviously, we have to take into account the environment as well. So I would say, look, it's more sort of, Michael, to be honest, rather than sort of incremental moves. But obviously, if that mix shift changes because we are making decisions are because we win sort of new relationships, then obviously will be very clear in our guidance.

But Jim, do you want to add anything beyond what I said.

No, I think that's well said. I think at this stage, we're likely -- it's a mix shift element. What would be clear is our targets from an ROE perspective. And our commitment that we're earning appropriate returns on the deployment of capital. And so I would think about us continuing to optimize and to grow that as the real focus point.

And Michael, I'll just [indiscernible] as well because, one of the things, for example, in something like Reinsurance, as we look into some of the more structured products, if that mix shift changes, obviously, it can be quite a shift in terms of sort of loss ratio, acquisition cost, et cetera. But look, for us, we'll go after where we think there's the most value. If we pull back in certain areas, we'll be very clear on what and why, but always with a good first principle, which is #1 underwriting principle.

And I think Jim capped it bit petty for me, which is like we think of it holistically in ROE and don't just sort of pull 1 particular lever, and we can sometimes see value in different areas, which obviously would shift between acquisition cost and loss ratio. And obviously, OUE much smaller number. But ultimately, we've made great progress on that over the last few years. So but we'll be as transparent as costed hopefully, this slide helped a bit as well. And thank you for your comments on that.

I guess given the pretty significant jump in insurance growth this quarter. I know last year you is when you -- I think you took out the $95 million. So I know we're apples-to-apples from this year to last year. But just help us think about how we can I guess, model, the premium growth going forward, was there any anomalies in this quarter in either A&H or sure that kind of led to the pretty significant growth this quarter?

Not normally, I wouldn't describe them as that, Michael. I mean what can happen, obviously, is we can win new relationships and obviously, that can impact it. Obviously, we've tried to be clear over the last few quarters, I hope, where we can see we've been sort of leaning into. So I think you can see the difference between our gross growth and our net written growth. And obviously, there's a link to a earned premium, which is still to come, which I think is the point that that Jim often makes.

So look, I think what you could expect subject to market conditions, profitability and a few other assumptions is our ambition is to make sure that we seize on the relationships that we bought in, in the 1- to 2-year segment on the pie chart. But obviously, that will be subject to us being satisfied with the sort of underwriting performance and obviously, market conditions, but I think that's effectively what we would be looking into. There's not really any anomalies per se.

But Jim, do you want to add anything?

Yes, I would just say Michael, maybe just thinking a little bit about trends. As Scott indicated, no anomalies from a quarter perspective or any year-over-year that you'd take a look at. It's been a pipeline that has been growing and the strength of our relationships have been growing that have enabled what we've seen from a quarter growth perspective. I would highlight, and we tried to call this out when I think about what growth might be, for example, in the fourth quarter, we're thinking that it will be much closer to what we experienced maybe year-to-date, recognizing that the fourth quarter tends to be -- or sometimes is a little bit slower than maybe kind of what your first quarter or some of the other quarters might be from just an overall kind of seasonality perspective and just where we see policies being written.

And that comment was more on insurance, correct. Just to be clear.

Yes, it was.

[Operator Instructions]

Pause a moment to allow for any other questions. Mr. Blackledge, there are no other questions at this time. I'll turn the floor back to you for final comments.

Thank you, everyone, for joining us today. If you have any follow-up questions, we will be around to take your call or you can e-mail us on [email protected]. Thank you for your ongoing support, and I hope you enjoy the remainder of your day. I will now turn it back over to the operator to wrap up the call.

Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.