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Bowhead Specialty Holdings Inc. Reports Second Quarter 2025 Results

NEW YORK--(BUSINESS WIRE)-- Bowhead Specialty Holdings Inc. (NYSE: BOW), a specialty lines insurance group focused on providing casualty, professional liability and healthcare liability insurance products, today announced financial results for the second quarter ended June 30, 2025.⁽¹⁾

Second Quarter 2025 Highlights

• Gross written premiums increased 32.4% to $232.4 million.
• Net income of $12.3 million, or $0.36 per diluted share.
• Adjusted net income⁽²⁾ of $12.8 million, or $0.37 per diluted share⁽²⁾.
• Return on equity of 12.4% and adjusted return on equity⁽²⁾ of 12.8%.
• Book value per share $12.44 and diluted book value per share of $12.04.

Bowhead Chief Executive Officer, Stephen Sills, commented, 鈥淲e are thrilled with our second quarter 2025 results. Our strategic execution and underwriting discipline have led to a strong 32% year-over-year growth in premiums, with impressive double-digit expansion across all our craft underwriting divisions. More importantly, net income for the quarter soared by 123% compared to the same period last year. These achievements underscore our steadfast dedication to sustainable and profitable growth, demonstrating that Bowhead is a franchise built for enduring success and cross-cycle profitability, not just a hard market play.鈥�

Underwriting Results

The 32.4% increase in gross written premiums to $232.4 million in the second quarter of 2025 was driven by our increasing renewal book and continued growth in our platform across all divisions:

• Our Casualty division led the growth with a 31.9% increase to $150.7 million;
• Professional Liability increased 23.3% to $54.8 million;
• Healthcare Liability increased 39.0% to $23.5 million;
• Baleen Specialty increased 23.2% from the previous quarter to $3.4 million.

Our loss ratio of 66.2% in the second quarter of 2025 increased 0.7 points compared to 65.5% in the second quarter of 2024, due to a 0.6 point increase in our current accident year and a 0.1 point increase in our prior accident year loss ratio.

The 0.6 point increase in our current accident year loss ratio was driven by changes in our portfolio mix. During the three months ended June 30, 2025, our Casualty division, which has comparatively higher current accident year industry loss ratios, comprised a larger proportion of our net earned premium compared to the prior period.

The 0.1 point increase in our prior accident year loss ratio was driven by expected loss ratios applied to audit premiums being fully earned in the quarter but associated with prior accident years. This development was not based on actual losses settling for more than reserved, and did not represent an increase in estimated reserves on unresolved claims.

Our expense ratio was 30.6% for the three months ended June 30, 2025, reflecting a decrease of 3.2 points compared to 33.8% for the same period in 2024. This decrease in our expense ratio was primarily driven by the 3.7 point decrease in our operating expenses ratio and a 0.4 point increase in other insurance-related income, which contributed to the lowering of our expense ratio. These improvements were partially offset by the 0.9 point increase in our net acquisition costs ratio.

The decrease in our operating expenses ratio was due to the continued scaling of our business, where net earned premiums grew at a higher rate than our expenses, as well as the prudent management of our expenses.

The increase in our net acquisition costs ratio was driven by the increase in earned broker commissions due to changes in our portfolio mix, and to a lesser extent, the reduction in earned ceding commissions from our ceded reinsurance treaties.

Investment Results

Net investment income increased 55.8% in the quarter to $13.7 million, driven by a higher balance of investments and higher yields on invested assets. Our investment portfolio had a had a book yield of 4.7% and a new money rate of 4.8% as of June 30, 2025.

The weighted average effective duration of our investment portfolio, which included cash equivalents, was 2.8 years and had an average rating of 鈥淎A鈥� as of June 30, 2025.

Summary of Operating Results

The following table summarizes the Company鈥檚 results of operations for the three and six months ended June 30, 2025 and 2024:

Condensed Consolidated Balance Sheets

Gross Written Premiums

The following tables present gross written premiums by underwriting division for the three and six months ended June 30, 2025 and 2024:

Loss Ratio

The following tables summarize current and prior accident year loss ratios for the three and six months ended June 30, 2025 and 2024:

Expense Ratio

The following tables summarize the components of our expense ratio for the three and six months ended June 30, 2025 and 2024:

Net Investment Income

The following table summarizes the sources of net investment income for the three and six months ended June 30, 2025 and 2024:

Reconciliation of Non-GAAP Financial Measures

This earnings release contains certain financial measures that are not presented in accordance with generally accepted accounting principles in the United States (鈥淯.S. GAAP鈥�). We use these non-GAAP financial measures when planning, monitoring and evaluating our performance. Management believes that each of the non-GAAP financial measures described below provides useful insight into our underlying business performance.

• Adjusted net income is defined as net income excluding the impact of net realized investment (losses) gains, non-operating expenses, foreign exchange losses (gains), and certain strategic initiatives. Adjusted net income excludes the impact of certain items that may not be indicative of underlying business trends, operating results, or future outlook, net of tax impact. We calculate the tax impact only on adjustments that would be included in calculating our income tax expense using the estimated tax rate at which we received a deduction for these adjustments.
• Adjusted return on equity is defined as adjusted net income as a percentage of average beginning and ending mezzanine equity and stockholders鈥� equity.
• Diluted adjusted earnings per share is defined as adjusted net income divided by the weighted average common shares outstanding for the period, reflecting the dilution that may occur if equity based awards are converted into common stock equivalents as calculated using the treasury stock method.

You should not rely on these non-GAAP financial measures as a substitute for any U.S. GAAP financial measure. While we believe that these non-GAAP financial measures are useful in evaluating our business, this information should be considered supplemental in nature and not as a replacement for or superior to the comparable U.S. GAAP measures. In addition, other companies, including companies in our industry, may calculate such measures differently, which reduces their usefulness as comparative measures.

Adjusted net income

Adjusted net income for the three and six months ended June 30, 2025 and 2024 reconciles to net income as follows:

Adjusted return on equity

Adjusted return on equity for the three and six months ended June 30, 2025 and 2024 reconciles to return on equity as follows:

Diluted adjusted earnings per share

Diluted adjusted earnings per share for the three and six months ended June 30, 2025 and 2024 reconciles to diluted earnings per share as follows:

About Bowhead Specialty Holdings Inc.

Bowhead Specialty is a growing specialty insurance business providing casualty, professional liability and healthcare liability insurance products. We were founded and are led by industry veteran Stephen Sills. The team is composed of highly experienced and respected industry veterans with decades of individual, successful underwriting and management experience. We focus on providing 鈥渃raft鈥� solutions in our specialty lines and classes of business that we believe require deep underwriting and claims expertise in order to produce attractive financial results.

We pride ourselves on the quality and experience of our people, who are committed to exceeding our partners鈥� expectations through excellent service and expertise. Our collaborative culture spans all functions of our business and allows us to provide a consistent, positive experience for all of our partners.

Conference Call

The Company will host a conference call to discuss its results on the same day, Tuesday, August 5, 2025, beginning at 8:30 a.m. Eastern Time. Interested parties may access the conference call through a live webcast, which can be accessed by going to , or by visiting the Company鈥檚 Investor Relations website. A dial-in option for listen-only participants will be available after registering for the call. Please join the live webcast or dial in at least 10 minutes before the start of the call.

A replay of the event webcast will be available on the Company鈥檚 Investor Relations website for one year following the call.

Forward-Looking Statements

This press release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in press release are forward-looking statements. In some cases, forward-looking statements can be identified by terms such as "anticipates," "believes," "estimates," "expects," "intends," "plans," "predicts," "projects," "seeks," "future," "outlook," "prospects" "will," "would," "should," "could," "may," "can have" or similar words. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward-looking statements. These risks include those described in the Company鈥檚 filings made with the Securities and Exchange Commission. Forward-looking statements speak only as of the date of this press release and the Company does not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events or otherwise.

View source version on businesswire.com:

Investor Relations Contact:

Shirley Yap, Head of Investor Relations

[email protected]

Source: Bowhead Specialty Holdings Inc.