Skyward Specialty Insurance Group (NASDAQ:SKWD) reported a fourth quarter that management said capped “another incredible year,” highlighted by record underwriting and adjusted operating earnings. On the company’s fourth quarter 2025 earnings call, Chairman and CEO Andrew Robinson and CFO Mark Haushill pointed to strong premium growth, an improved combined ratio, and rising book value, while also discussing increasing market competition and the recently completed Apollo transaction.
Fourth quarter and full-year financial highlights
Robinson said fourth quarter adjusted operating income increased 47% to $49 million and underwriting income reached $41 million, both all-time highs and the fourth consecutive quarter of record results for those metrics. For the full year, the company reported return on equity of 18.9% and return on tangible equity of 20.9%.
Premium growth, retention, and underwriting performance
Gross written premiums grew more than 13% in the quarter, driven by the Accident & Health (A&H), Surety, and Specialty Programs divisions, Haushill said. Robinson added that the company grew “over 20%” in Surety, A&H, and Specialty Programs. Net written premiums grew 25% for the year, and retention of 64.9% was stable year-over-year and consistent with guidance, according to Haushill.
The fourth quarter combined ratio improved 7.3 points year over year to 88.5%, reflecting net favorable development and what Haushill described as a “modest catastrophe quarter.” The loss ratio was 59.6% and included net favorable prior-year development across multiple lines, primarily Surety and Property, totaling $7.5 million (2.1 points on the loss ratio). Favorable development more than offset modest adverse development in more recent accident years, principally in commercial auto and excess auto—areas Robinson said the company has been exiting over the past three years.
Haushill said the company ended the year with a strong reserve profile, with 74% of reserves in IBNR (its highest level historically) and a paid-to-incurred ratio of 65% for 2025, consistent with 2024. The expense ratio was 28.9% for the quarter, consistent with the prior-year quarter, as efficiency gains were offset by higher acquisition costs tied to business mix and fourth quarter profit-share true-ups.
Investments, capital position, and leverage outlook
Net investment income increased $3 million versus the prior-year quarter, driven by a larger asset base and higher yields in fixed income. Haushill said the company put $52 million to work in the quarter at 5.6%, and embedded yield was 5.3% at year-end, up from 5.1% a year earlier.
He also noted that underlying marks of $2 million on private credit holdings in the alternative asset portfolio continued to impact net investment income. Management characterized 2025 alternative asset results as “disappointing,” while emphasizing that the alternatives portfolio represented 3.8% of invested assets at December 31, down from 6% a year ago; $44 million of alternative capital was returned during the year and reinvested into fixed income.
Skyward ended the quarter with a debt-to-capital ratio under 11%, but Haushill said leverage will rise following debt related to the Apollo transaction, with expectations for first quarter 2026 leverage in the 28% to 29% range. He added that at the January 1 close of the Apollo transaction, fully diluted book value per share is expected to be $26.00 to $26.10, compared with $23.87 at December 31. The company reiterated that previously issued 2026 guidance (provided December 3) is unchanged.
Haushill also said the company’s prior material weakness in IT controls has been remediated and will be reflected in the 10-K, with “no material weaknesses.” He said the company intends to “opportunistically deploy excess capital” through its share repurchase program, citing what he called an “extremely attractive” share price.
Business mix, market conditions, and competition
Robinson emphasized portfolio construction and diversification, saying more than 58% of the business is now in short-tail lines, and 48% is in lines “less exposed to the P&C cycles.” He also said the company has evolved nearly 50% of its portfolio to less cyclical lines over time.
Within segments, management said it expects strong continued growth in A&H and Surety, while Specialty Programs growth should be flatter as the impact of two programs added in early 2025 becomes fully reflected in written premium. Robinson said the company saw considerable property competition, and noted that fourth quarter competitive dynamics were especially visible in E&S and Professional Lines, where Skyward “defended our books effectively” but wrote less new business due to pricing and terms.
On commercial auto, Robinson said the company reduced exposure by more than 62% over the last 12 quarters, reflecting an intentional response to loss-cost inflation and what he described as an “awful tort backdrop.” In response to questions on reserve development, Haushill said commercial auto moved in accident years 2022 and 2024 by “circa $25 million-ish,” offset by favorable development in shorter-tail lines, and reiterated that the adverse development was tied to lines the company has exited.
Apollo combination and Uber autonomous vehicle partnership
Robinson repeatedly highlighted the strategic rationale for the Apollo combination. In response to analyst questions, he said Apollo’s 2025 results were “uncannily similar” to Skyward’s, with approximately 20% growth and a combined ratio around 89. He noted Apollo’s expense ratio was about four to five points higher than Skyward’s, with a correspondingly lower loss ratio.
Robinson also discussed Apollo’s partnership with Uber related to an Autonomous Vehicle Insurance Policy (AVIP), saying Apollo is Uber’s “sole carrier partner” for what Uber described as its manufacturer-agnostic autonomous rideshare platform. He described AVIP as a comprehensive embedded liability product combining general and product liability along with other coverages. Responding to questions, Robinson stressed that the AVIP is not a commercial auto policy and said Skyward/Apollo believes autonomous vehicle risks differ materially from human-driven exposures, citing both information advantages and expected differences in frequency and severity. He also said that within Apollo’s Syndicate 1971, Skyward’s capital participates on a 25% basis for 2026, with 75% provided by third-party reinsurers, and that the structure includes a fee-based component.
Management closed the call by reiterating confidence in positioning despite a more competitive environment. Robinson said it is “unlikely that every quarter going forward can be an all-time best,” but added that Skyward believes it has “never been better positioned” to deliver sustained, top-quartile shareholder value.
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.
