Skyward Specialty Insurance Group (NASDAQ:SKWD) reported higher operating earnings and premium growth for the third quarter of 2026, even as executives described increasing competition in parts of the property and casualty insurance markets.
Operating income rose to $58 million, or $1.28 per diluted share, with diluted operating earnings per share increasing 22% from a year earlier. Gross written premiums grew 9% to $803 million, while fee-generating gross written premiums increased more than 18% to $517 million.
Through the first nine months of the year, operating income was approximately $175 million and annualized operating return on equity exceeded 20%, Chief Financial Officer Mark Haushill said. The consolidated combined ratio was 89.9, or 88.1 excluding catastrophe losses.
Chairman and CEO Andrew Robinson said the company’s diversified portfolio allows it to direct capital toward attractive opportunities while remaining disciplined in areas where returns are less compelling. Skyward remains on track to deliver full-year premium growth near the upper end of its original $2.65 billion to $2.8 billion guidance range, Haushill said.
Premium Growth and Agriculture Adjustment
Skyward Specialty’s insurance operations generated $668 million in gross written premiums, up 10%, led by accident and health, global agriculture, credit and surety, and Strategic Distribution Partners. Growth was partly offset by pricing pressure in portions of the property market and selected casualty and liability classes.
Haushill said lower-than-expected uptake of dairy and livestock coverage, as higher input costs pressured farmers’ cash flow and margins, affected growth in that business. Adjustments related to the 2025 and 2026 treaty year were the primary reason for lower net earned premiums in the quarter.
Robinson said Skyward also reduced its expected premium for the subsequent treaty year to account for the possibility that farmers’ costs would continue to affect their purchasing. He said the company did not expect an unusual earned-premium adjustment in the fourth quarter, while noting that another true-up could not be ruled out.
Skyward Specialty’s net earned premiums rose more than 13% through the first nine months. The business posted an 88.3 combined ratio for the quarter, including 1.5 points of catastrophe losses, primarily from convective storms. Its expense ratio improved to 25.7; the year-to-date ratio of 25.4 was 1.7 points better than in the prior-year period.
Apollo Fees and New Initiatives
At Apollo, gross written premiums increased 3% to $135 million. Deputy CFO Taryn McHarg said 11% growth at specialty risk Syndicate 1969 was partly offset by a modest decline at digital-economy-focused ibott Syndicate 1971, reflecting renewal timing and seasonally lower new-business opportunities.
Apollo’s fee-generating gross written premiums rose 18% to $517 million, including 70% growth in partner syndicates. Underwriting fee income totaled $11 million for the quarter and approximately $34 million for the first nine months. McHarg said fee income lags premium growth somewhat and that the company would provide a view of 2027 with its next guidance update.
Robinson said Skyward launched two partner syndicates during the quarter and sees a strong pipeline heading into 2027. McHarg said the company does not propose to contribute capital to the two new syndicates, consistent with its other partner-platform syndicates.
Skyward also recently announced the launch of ibott in the U.S. and a partnership and founding investment in Slingshot, an AI-native platform for embedded insurance products. Robinson said the company intends to report both initiatives through its Strategic Distribution Partners division.
Pricing, Reserves and Capital
Skyward Specialty’s pure rate increase excluding property was in the mid-single digits, Haushill said. Robinson cautioned against reading too much into changes in that figure because the business mix can vary, though he acknowledged an increasingly competitive environment.
Robinson said third-quarter submissions for the company’s U.S. excess and surplus property business rose 60%, while its hit ratio fell by a third and average premiums declined 20%. He said Skyward had not observed a meaningful shift of premium from the excess and surplus market back to the admitted market.
The company is completing a ground-up reserve review. Haushill said initial indications were positive for several lines, including occurrence liability, property, surety and accident and health, though there was some pressure in exited commercial auto and claims-made professional liability portfolios. Skyward recognized no prior-year reserve development in the quarter and plans a fuller update on its fourth-quarter call.
Net investment income increased 54% to $34 million, helped by the addition of Apollo’s portfolio and higher yields. Book value per share rose more than 15% from December 2025 to $28.74.
On capital allocation, Haushill said Skyward’s first priority remains deploying capital into the business, with debt repayment and share repurchases as other options. He said he currently leans toward paying down debt, but the company will complete its analysis after year-end.
Skyward also confirmed that McHarg will succeed Haushill as CFO when he retires on March 31, 2027. Management plans to provide specific 2027 guidance on its fourth-quarter earnings call.
About Skyward Specialty Insurance Group (NASDAQ:SKWD)
Skyward Specialty Insurance Group, Inc is a specialty property and casualty insurance company headquartered in Houston, Texas. Through its insurance subsidiaries, the company provides customized coverage for businesses and organizations that may be underserved by the standard insurance market.
Its offerings include excess and surplus lines insurance, professional liability, healthcare liability, workers’ compensation, surety, commercial property and casualty coverage, specialty programs, and accident and health products.
