Skyward Specialty Insurance Group (NASDAQ:SKWD) reported higher second-quarter earnings and premium volume, supported by underwriting profitability, growth in several specialty businesses and increased investment income.
Chairman and Chief Executive Officer Andrew Robinson called the quarter “simply outstanding,” saying the company continued to benefit from its diversified portfolio and “rule our niche” strategy. Diluted operating earnings per share increased 46% from a year earlier to $1.30, while annualized operating return on equity was 19%.
Premium Growth and Underwriting Results
Total managed premiums increased 18% year over year to $1.1 billion during the quarter, while gross written premiums rose 13% to $741 million. Within the Skyward Specialty segment, gross written premiums increased 14% to $668 million, led by Accident & Health, Global Agriculture, Credit & Surety, and Specialty Programs.
Apollo gross written premiums rose 6% to $73 million. The company said Apollo’s specialty lines in Syndicate 1969 grew 8% from the prior-year period. Fee-generating gross written premiums increased 29% to $318 million, including 80% growth from Platform Partner syndicates and 13% growth from capital-aligned syndicates. Apollo generated $13 million of underwriting fee income in the quarter.
Haushill cautioned that Apollo’s quarterly results can be affected by seasonal production patterns and said the second-quarter growth rate should not necessarily be viewed as indicative of longer-term trends.
The company reported a consolidated combined ratio of 89.5, including 1.9 percentage points of catastrophe losses. The ex-catastrophe combined ratio was 87.6. Skyward Specialty’s combined ratio was 86.9 and its ex-catastrophe combined ratio was 85.6.
Skyward Specialty’s loss ratio was 62.6, including 1.3 points of catastrophe losses. Its non-catastrophe loss ratio increased 1.4 points from a year earlier to 61.3, which Haushill attributed to business mix, particularly the increased contribution from the higher-loss-ratio Accident & Health and Global Agriculture divisions. The company reported no reserve development during the quarter.
Skyward Specialty’s expense ratio improved 2.7 points year over year to 24.3. Robinson said expense discipline, technology investments, machine learning and artificial intelligence are helping improve underwriting efficiency. He cited the company’s SkyView underwriting workstation and technology used in its surety operation to automate intake and analysis of financial information, bond forms and contracts.
Apollo posted a combined ratio of 97.6, including 5.4 catastrophe-loss points primarily related to the Middle East conflict. Its non-catastrophe loss ratio was 54.7. Haushill said Apollo’s year-to-date combined ratio of 91.3 and expense ratio of 34.9 provide a more representative view of its performance than the quarterly figures, which included expense classification adjustments.
Market Conditions and Portfolio Mix
Robinson said Skyward continues to find growth opportunities in Accident & Health, Credit & Surety and Global Agriculture, which he described as relatively insulated from pressures in traditional property and casualty markets. He also identified Healthcare Solutions, power and renewables, political risk and political violence, and Platform Partner syndicates as areas with growth potential.
At the same time, the company is taking a selective approach in global and excess-and-surplus property, miscellaneous professional liability and some E&S liability markets. Robinson said pricing and underwriting conditions have become less attractive in those areas and that Skyward is prioritizing profitability over volume.
In global property, Robinson said the company added only one account during the quarter and renewed roughly two dozen mostly longstanding accounts. He said facultative reinsurance helps reduce the impact of declining gross rates because Skyward writes large lines and can transfer portions of those exposures.
Robinson said Skyward’s pure rate was in the high single digits excluding global property and in the low single digits including it. Retention remained in the 70% range, while submissions increased by a percentage in the teens. Apollo’s risk-adjusted rate change was a low-single-digit decline.
Regarding the changing business mix, Robinson said more than 60% of the company’s business through the first half of 2026, including Apollo, had liability durations of less than two years. He said management expects the full-year accident-year loss ratio to rise by roughly one percentage point or somewhat more because of Agriculture and Accident & Health mix, with a corresponding benefit to the acquisition expense ratio. He said the company’s combined-ratio expectations have not changed.
Capital, Investments and Buybacks
Net investment income increased more than 60% from the prior-year period to $31 million, driven primarily by $29 million of fixed-income portfolio income. Haushill said the company invested new money at yields of 5.6%, while the fixed-income portfolio’s embedded yield was 5.3%.
The company said alternative and strategic investments remained pressured by lower valuations in certain limited partnership investments. Those exposures totaled about $68 million of $2.8 billion in invested assets. Haushill said approximately $2.5 billion of invested assets were in fixed-income and short-term investments and described the portfolio as positioned for consistent, risk-adjusted returns.
Stockholders’ equity increased to about $1.3 billion at June 30, while book value per share rose 15% from year-end to $28.55. Financial leverage declined two points from the first quarter to 26%. During the quarter, Skyward repaid $50 million of its $150 million term loan due at the end of 2027.
The company repurchased 223,000 shares for approximately $10 million during the quarter. In July, it increased its share repurchase authorization to $100 million from $50 million. Robinson said the company is generating excess capital and views buybacks as an attractive, opportunistic use of capital given its earnings outlook, returns and valuation.
Management also said it continues to evaluate ways to apply Apollo’s capital-light Lloyd’s platform more broadly. Robinson said Skyward expects to begin using a portion of its outward reinsurance through Apollo’s internal reinsurance syndicate in 2027, while longer-term options such as a whole-account quota share or a dedicated syndicate remain under review.
About Skyward Specialty Insurance Group (NASDAQ:SKWD)
Skyward Specialty Insurance Group, Inc (NASDAQ: SKWD) is a publicly traded specialty property and casualty insurance underwriter. The company focuses on niche market segments, offering tailored insurance solutions designed to address the specific risk profiles of its target industries.
Through its underwriting platform, Skyward Specialty provides coverage in areas including general liability, professional liability, commercial package, inland marine and other selected specialty lines. Its products are distributed primarily through a network of wholesale brokers, program administrators and managing general agents, enabling the company to reach a diverse client base and adapt quickly to evolving market needs.
Headquartered in the United States, Skyward Specialty Insurance Group operates across multiple states and applies data-driven underwriting and risk management practices to maintain disciplined reserving and consistent performance.
