RLI Reports Fourth Quarter and Year-End 2025 Results

RLI Reports Fourth Quarter and Year-End 2025 Results January 21, 2026 RLI Corp. (NYSE: RLI) reported fourth quarter 2025 net earnings of $91.2 million ($0.99 per share), compared to $40.9 million ($0.44 per share) for the fourth quarter of 2024. Operating earnings(1) for the fourth quarter of 2025 were $86.4 million ($0.94 per share), compared to $48.3 million ($0.52 per share) for the same period in 2024. Fourth Quarter Year to Date Earnings Per Diluted Share 2025 2024 2025 2024 Net earnings $ 0.99 $ 0.44 $ 4.37 $ 3.74 Operating earnings(1)(2) $ 0.94 $ 0.52 $ 3.47 $ 2.91 (1) See discussion below: Non-GAAP and Performance Measures. (2) Equity in earnings of unconsolidated investees and the related taxes were removed from operating earnings and operating earnings per share, resulting in consistent exclusion of unrealized changes in equity investments from operating results. Prior period amounts have been recast to conform to the current definition. Highlights for the quarter included: Underwriting income (1) of $70.9 million on a combined ratio (1) of 82.6.Net investment income increased 9%, while gross premiums written declined 2%.Favorable development in prior years’ loss reserves resulted in a $22.0 million net increase in underwriting income.Special dividend of $2.00 per share, representing $183.7 million returned to shareholders. Highlights for the year included: Underwriting income (1) of $264.2 million on a combined ratio (1) of 83.6.2025 delivered our 30th consecutive year of underwriting income.12% increase in net investment income and 1% increase in gross premiums written.Favorable development in prior years’ loss reserves resulted in an $87.4 million net increase in underwriting income.Book value per share of $19.35, an increase of 33% (inclusive of dividends) from year-end 2024. “Our fourth-quarter results reflect the strength of our diversified specialty product portfolio and underwriting discipline,” said RLI Corp. President & CEO Craig Kliethermes. “We achieved an 83 combined ratio, underscoring our ability to produce positive underwriting results in a highly competitive market while remaining focused on profitability.” “For the full year, premium growth was modest at 1%, but our strong underwriting performance drove an 84 combined ratio, marking our 30th consecutive year of underwriting profitability. Favorable underwriting and investment outcomes contributed to a 33% increase in book value from year-end 2024 and supported meaningful returns to shareholders. These results highlight the discipline, expertise and ownership mindset of our associate-owners, which continue to make RLI different.” Underwriting Income RLI achieved $70.9 million of underwriting income in the fourth quarter of 2025 on an 82.6 combined ratio, compared to $22.2 million on a 94.4 combined ratio in 2024. For the year, RLI achieved $264.2 million of underwriting income on an 83.6 combined ratio, compared to $210.7 million on an 86.2 combined ratio in 2024. Results for both years include favorable development in prior years’ loss reserves, which resulted in an $87.4 million and $84.1 million net increase to underwriting income in 2025 and 2024, respectively. The favorable development was offset by a $26.5 million net reduction to underwriting income for storm losses in 2025. This compares to $93.6 million for losses from Hurricanes Beryl, Helene and Milton, as well as other storm losses, in 2024. The following table highlights underwriting income and combined ratios by segment for the year. Underwriting Income(1) Combined Ratio(1) (in millions) 2025 2024 2025 2024 Casualty $ 15.9 $ 17.8 Casualty 98.3 97.9 Property 219.1 167.6 Property 57.2 68.5 Surety 29.2 25.3 Surety 80.3 82.2 Total $ 264.2 $ 210.7 Total 83.6 86.2 (1) See discussion below: Non-GAAP and Performance Measures. Other Income Net investment income for the quarter increased 9% to $42.3 million, compared to the same period in 2024. For the year ended December 31, 2025, net investment income was $159.7 million, compared to $142.3 million for the same period in 2024. The investment portfolio’s total return was 1.5% for the quarter and 9.0% for the year. RLI’s comprehensive earnings were $100.4 million for the quarter ($1.09 per share), compared to a comprehensive loss of $26.3 million (-$0.28 per share) for the same quarter in 2024. In addition to net earnings, comprehensive earnings for 2025 included after-tax unrealized gains from the fixed income portfolio, due to declining interest rates. Full-year comprehensive earnings were $489.0 million ($5.29 per share), compared to $338.4 million ($3.66 per share) in 2024. Special and Regular Dividends On December 19, 2025, the company paid a special cash dividend of $2.00 per share and a regular quarterly dividend of $0.16 per share for a combined total of $198.4 million. RLI has paid dividends for 198 consecutive quarters and increased regular dividends in each of the last 50 years. Over the last 10 years, the company has returned more than $1.6 billion to shareholders and the regular divided has grown an average of 5.4% per year. Non-GAAP and Performance Measures Management has included certain non-generally accepted accounting principles (non-GAAP) financial measures in presenting the company’s results. Management believes that these non-GAAP measures further explain the company’s results of operations and allow for a more complete understanding of the underlying trends in the company’s business. These measures should not be viewed as a substitute for those determined in accordance with generally accepted accounting principles (GAAP). In addition, our definitions of these items may not be comparable to the definitions used by other companies. Operating earnings and operating earnings per share (EPS) consist of our GAAP net earnings adjusted by net realized gains/(losses), net unrealized gains/(losses) on equity securities and taxes related thereto. Beginning in the fourth quarter of 2025, equity in earnings of unconsolidated investees and the related taxes were excluded from operating earnings and operating EPS. The change was made to present a consistent approach in excluding all unrealized changes in equity investments. We view these minority investments as outside of RLI’s operating control. Operating earnings and operating EPS for prior periods have been recast to conform to the current definition. Net earnings and net earnings per share are the GAAP financial measures that are most directly comparable to operating earnings and operating EPS. A reconciliation of the operating earnings and operating EPS to the comparable GAAP financial measures is included in the 2025 financial highlights below. Underwriting income or profit represents the pretax profitability of our insurance operations and is derived by subtracting loss and settlement expenses, policy acquisition costs and insurance operating expenses from net premium earned, which are all GAAP financial measures. The combined ratio, which is derived from components of underwriting income, is a performance measure commonly used by property and casualty insurance companies and is calculated as the sum of loss and settlement expenses, policy acquisition costs and insurance operating expenses, divided by net premiums earned, which are all GAAP measures. Other News At 10 a.m. central standard time (CST) on January 22, 2026, RLI management will hold a conference call to discuss quarterly results with insurance industry analysts. Interested parties may listen to the discussion at https://events.q4inc.com/attendee/710150907. Except for historical information, this news release may include forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934) including, without limitation, statements reflecting our current expectations about the future performance of our company or our business segments or about future market conditions. These statements are subject to certain risk factors that could cause actual results to differ materially. Various risk factors that could affect future results are listed in the company's filings with the Securities and Exchange Commission, including the Form 10-K Annual Report for the year ended December 31, 2024. About RLI RLI Corp. (NYSE: RLI) is a specialty insurer serving niche property, casualty and surety markets. The company provides deep underwriting expertise and superior service to commercial and personal lines customers nationwide. RLI’s products are offered through its insurance subsidiaries – RLI Insurance Company, Mt. Hawley Insurance Company and Contractors Bonding and Insurance Company. All of RLI’s insurance subsidiaries are rated A+ (Superior) by AM Best Company. RLI has paid and increased regular dividends for 50 consecutive years and delivered underwriting profits for 30 consecutive years. To learn more about RLI, visit www.rlicorp.com. Supplemental disclosure regarding the earnings impact of specific items: Reserve Development(1) and Catastrophe Losses, Net of Reinsurance Three Months Ended Twelve Months Ended December 31, December 31, (Dollars in millions, except per share amounts) 2025 2024 2025 2024 Favorable development in casualty prior years' reserves $ 2.5 $ 11.5 $ 31.2 $ 51.4 Favorable development in property prior years' reserves $ 0.7 $ 0.1 $ 27.9 $ 28.6 Favorable (unfavorable) development in surety prior years' reserves $ 2.7 $ (1.7 ) $ 15.9 $ 9.3 Net incurred losses related to: 2025 catastrophe events $ (4.0 ) $ — $ (30.0 ) $ — 2024 and prior catastrophe events $ 19.0 $ (39.0 ) $ 24.0 $ (100.0 ) Operating Earnings Per Share Three Months Ended Twelve Months Ended December 31, December 31, 2025 2024 2025 2024 Operating Earnings Per Share(2)(3) $ 0.94 $ 0.52 $ 3.47 $ 2.91 Specific items included in operating earnings per share:(1)(4) Net favorable development in casualty prior years' reserves $ 0.01 $ 0.09 $ 0.19 $ 0.37 Net favorable development in property prior years' reserves $ 0.02 $ — $ 0.23 $ 0.22 Net favorable (unfavorable) development in surety prior years' reserves $ 0.02 $ (0.02 ) $ 0.12 $ 0.07 Net incurred losses related to: 2025 catastrophe events $ (0.03 ) $ — $ (0.22 ) $ — 2024 and prior catastrophe events $ 0.14 $ (0.29 ) $ 0.18 $ (0.74 ) (1) Reserve development reflects changes from previously estimated losses. (2) Equity in earnings of unconsolidated investees and the related taxes were removed from operating earnings and operating earnings per share, resulting in consistent exclusion of unrealized changes in equity investments from operating results. Prior period amounts have been recast to conform to the current definition. (3) Equity in earnings of unconsolidated investees and the related taxes were removed from operating earnings and operating earnings per share, resulting in consistent exclusion of unrealized changes in equity investments from operating results. Prior period amounts have been recast to conform to the current definition. (4) Items included in operating earnings per share are after tax and incorporates incentive and profit sharing-related impacts which affected policy acquisition, insurance operating and general corporate expenses. RLI CORP 2025 FINANCIAL HIGHLIGHTS (Unaudited) (Dollars in thousands, except per share amounts) Three Months Ended December 31, Twelve Months Ended December 31, SUMMARIZED INCOME STATEMENT DATA: 2025 2024 % Change 2025 2024 % Change Net premiums earned $ 406,402 $ 397,176 2.3 % $ 1,614,346 $ 1,526,406 5.8 % Net investment income 42,325 38,776 9.2 % 159,739 142,278 12.3 % Net realized gains 16,882 8,744 93.1 % 65,116 19,966 NM Net unrealized gains (losses) on equity securities 84 (5,580 ) NM 43,247 81,734 (47.1 ) % Consolidated revenue $ 465,693 $ 439,116 6.1 % $ 1,882,448 $ 1,770,384 6.3 % Loss and settlement expenses 176,141 225,512 (21.9 ) % 725,955 739,253 (1.8 ) % Policy acquisition costs 130,261 121,854 6.9 % 508,387 464,040 9.6 % Insurance operating expenses 29,132 27,568 5.7 % 115,815 112,460 3.0 % Interest expense on debt 1,309 1,492 (12.3 ) % 5,358 6,331 (15.4 ) % General corporate expenses 4,281 2,736 56.5 % 17,028 15,880 7.2 % Total expenses $ 341,124 $ 379,162 (10.0 ) % $ 1,372,543 $ 1,337,964 2.6 % Equity in earnings of unconsolidated investees (10,979 ) (12,522 ) (12.3 ) % (3,924 ) (4,869 ) (19.4 ) % Earnings before income taxes $ 113,590 $ 47,432 139.5 % $ 505,981 $ 427,551 18.3 % Income tax expense 22,413 6,572 NM 102,644 81,772 25.5 % Net earnings $ 91,177 $ 40,860 123.1 % $ 403,337 $ 345,779 16.6 % Other comprehensive earnings (loss), net of tax 9,244 (67,199 ) NM 85,649 (7,420 ) NM Comprehensive earnings (loss) $ 100,421 $ (26,339 ) NM $ 488,986 $ 338,359 44.5 % Operating earnings(1): Net earnings $ 91,177 $ 40,860 123.1 % $ 403,337 $ 345,779 16.6 % Less: Net realized gains (16,882 ) (8,744 ) 93.1 % (65,116 ) (19,966 ) NM Income tax on realized gains 3,545 1,836 93.1 % 13,675 4,193 NM Net unrealized (gains) losses on equity securities (84 ) 5,580 (101.5 ) % (43,247 ) (81,734 ) (47.1 ) % Income tax on unrealized gains (losses) on equity securities 18 (1,171 ) (101.5 ) % 9,082 17,164 (47.1 ) % Equity in earnings of unconsolidated investees 10,979 12,522 (12.3 ) % 3,924 4,869 (19.4 ) % Income tax on equity in earnings of unconsolidated investees (2,305 ) (2,629 ) (12.3 ) % (824 ) (1,022 ) (19.4 ) % Operating earnings(2) $ 86,448 $ 48,254 79.2 % $ 320,831 $ 269,283 19.1 % Return on Equity: Net earnings 23.7 % 22.2 % Comprehensive earnings 28.7 % 21.7 % Per Share Data: Diluted: Weighted average shares outstanding (in 000's) 92,223 92,725 92,391 92,451 Net earnings per share $ 0.99 $ 0.44 125.0 % $ 4.37 $ 3.74 16.8 % Less: Net realized gains (0.18 ) (0.09 ) 100.0 % (0.70 ) (0.22 ) NM Income tax on realized gains 0.03 0.02 50.0 % 0.14 0.05 NM Net unrealized (gains) losses on equity securities — 0.06 (100.0 ) % (0.47 ) (0.88 ) (46.6 ) % Income tax on unrealized gains (losses) on equity securities — (0.02 ) (100.0 ) % 0.10 0.18 (44.4 ) % Equity in earnings of unconsolidated investees 0.12 0.14 (14.3 ) % 0.04 0.05 (20.0 ) % Income tax on equity in earnings of unconsolidated investees (0.02 ) (0.03 ) (33.3 ) % (0.01 ) (0.01 ) — % Operating earnings per share(1)(2) $ 0.94 $ 0.52 80.8 % $ 3.47 $ 2.91 19.2 % Comprehensive earnings per share $ 1.09 $ (0.28 ) NM $ 5.29 $ 3.66 44.5 % Cash dividends per share - ordinary $ 0.16 $ 0.15 10.3 % $ 0.63 $ 0.57 10.5 % Cash dividends per share - special $ 2.00 $ 2.00 — % $ 2.00 $ 2.00 — % Net cash flow provided by operations $ 158,659 $ 128,080 23.9 % $ 616,112 $ 560,219 10.0 % (1) See discussion above: Non-GAAP and Performance Measures. (2) Equity in earnings of unconsolidated investees and the related taxes were removed from operating earnings and operating earnings per share, resulting in consistent exclusion of unrealized changes in equity investments from operating results. Prior period amounts have been recast to conform to the current definition. NM = Not Meaningful RLI CORP 2025 FINANCIAL HIGHLIGHTS (Unaudited) (Dollars in thousands, except per share amounts) December 31, December 31, 2025 2024 % Change SUMMARIZED BALANCE SHEET DATA: Fixed income, at fair value $ 3,533,336 $ 3,175,796 11.3 % (amortized cost - $3,642,362 at 12/31/25) (amortized cost - $3,391,159 at 12/31/24) Equity securities, at fair value 898,876 736,191 22.1 % (cost - $534,311 at 12/31/25) (cost - $417,897 at 12/31/24) Short-term investments 120,562 74,915 60.9 % Other invested assets 59,281 57,939 2.3 % Cash and cash equivalents 51,565 39,790 29.6 % Total investments and cash $ 4,663,620 $ 4,084,631 14.2 % Accrued investment income 30,026 28,319 6.0 % Premiums and reinsurance balances receivable 212,226 230,534 (7.9 ) % Ceded unearned premiums 124,669 124,955 (0.2 ) % Reinsurance balances recoverable on unpaid losses 746,798 755,425 (1.1 ) % Deferred policy acquisition costs 172,648 166,214 3.9 % Property and equipment 40,733 43,172 (5.6 ) % Investment in unconsolidated investees 53,521 56,477 (5.2 ) % Goodwill and intangibles 53,562 53,562 0.0 % Income taxes - deferred — 7,793 (100.0 ) % Other assets 63,683 77,720 (18.1 ) % Total assets $ 6,161,486 $ 5,628,802 9.5 % Unpaid losses and settlement expenses $ 2,886,819 $ 2,693,470 7.2 % Unearned premiums 991,636 984,140 0.8 % Reinsurance balances payable 40,580 44,681 (9.2 ) % Funds held 127,242 97,380 30.7 % Income taxes - current 29,724 749 NM Income taxes - deferred 21,769 — NM Short-term debt 100,000 100,000 — % Accrued expenses 128,597 124,242 3.5 % Other liabilities 56,923 62,173 (8.4 ) % Total liabilities $ 4,383,290 $ 4,106,835 6.7 % Shareholders' equity 1,778,196 1,521,967 16.8 % Total liabilities & shareholders' equity $ 6,161,486 $ 5,628,802 9.5 % OTHER DATA: Common shares outstanding (in 000's) 91,879 91,738 Book value per share $ 19.35 $ 16.59 16.6 % Closing stock price per share $ 63.98 $ 82.42 (22.4 ) % Statutory surplus $ 1,846,615 $ 1,787,312 3.3 % NM = Not Meaningful RLI CORP 2025 FINANCIAL HIGHLIGHTS UNDERWRITING SEGMENT DATA (Unaudited) (Dollars in thousands, except per share amounts) Three Months Ended December 31, GAAP GAAP GAAP GAAP Casualty Ratios Property Ratios Surety Ratios Total Ratios 2025 Gross premiums written $ 289,127 $ 136,407 $ 37,704 $ 463,238 Net premiums written 235,374 90,973 34,306 360,653 Net premiums earned 246,787 122,507 37,108 406,402 Net loss & settlement expenses 157,171 63.7 % 16,147 13.2 % 2,823 7.6 % 176,141 43.3 % Net operating expenses 88,595 35.9 % 44,085 36.0 % 26,713 72.0 % 159,393 39.3 % Underwriting income (loss) (1) $ 1,021 99.6 % $ 62,275 49.2 % $ 7,572 79.6 % $ 70,868 82.6 % 2024 Gross premiums written $ 282,204 $ 153,295 $ 37,711 $ 473,210 Net premiums written 228,455 103,945 34,045 366,445 Net premiums earned 225,823 134,610 36,743 397,176 Net loss & settlement expenses 155,217 68.7 % 63,856 47.4 % 6,439 17.5 % 225,512 56.8 % Net operating expenses 79,356 35.2 % 44,516 33.1 % 25,550 69.6 % 149,422 37.6 % Underwriting income (loss) (1) $ (8,750 ) 103.9 % $ 26,238 80.5 % $ 4,754 87.1 % $ 22,242 94.4 % Twelve Months Ended December 31, GAAP GAAP GAAP GAAP Casualty Ratios Property Ratios Surety Ratios Total Ratios 2025 Gross premiums written $ 1,191,254 $ 672,907 $ 162,685 $ 2,026,846 Net premiums written 990,621 482,635 148,873 1,622,129 Net premiums earned 953,981 512,404 147,961 1,614,346 Net loss & settlement expenses 595,178 62.4 % 120,146 23.4 % 10,631 7.2 % 725,955 45.0 % Net operating expenses 342,936 35.9 % 173,133 33.8 % 108,133 73.1 % 624,202 38.6 % Underwriting income (loss) (1) $ 15,867 98.3 % $ 219,125 57.2 % $ 29,197 80.3 % $ 264,189 83.6 % 2024 Gross premiums written $ 1,108,356 $ 743,486 $ 161,206 $ 2,013,048 Net premiums written 915,625 542,997 146,899 1,605,521 Net premiums earned 852,837 531,384 142,185 1,526,406 Net loss & settlement expenses 524,490 61.5 % 198,806 37.4 % 15,957 11.2 % 739,253 48.4 % Net operating expenses 310,559 36.4 % 165,042 31.1 % 100,899 71.0 % 576,500 37.8 % Underwriting income (loss) (1) $ 17,788 97.9 % $ 167,536 68.5 % $ 25,329 82.2 % $ 210,653 86.2 % (1) See discussion above: Non-GAAP and Performance Measures. Category: Earnings Release Media Contact Aaron Diefenthaler Chief Financial Officer 309-693-5846 [email protected] Source: RLI Corp.