Kinsale Buys Back $100 Million of Shares in Third Quarter, Maintains Pace for Current Authorization
Key Facts
Kinsale repurchased 269,004 shares in the open market for $100 million during the third quarter of 2026, at an average price of $371.74 per share, according to the company’s results. Management said $100 million represents an appropriate quarterly pace for the remainder of the current buyback authorization, while leaving room to act if additional opportunities arise. The company did not confirm that it would maintain this pace after the authorization expires. The transaction was worth just under 80% of quarterly operating net income, according to the earnings call. That places capital returns within a quarter marked by lower gross written premiums alongside growth in operating earnings.
Third-quarter buybacks matched the second quarter’s $100 million, after totaling $62.5 million in the first quarter of 2026. As of September 30, the company had $237.5 million of capacity remaining under its buyback program. Since the program began, Kinsale has repurchased 990,763 shares at a total cost of $362.5 million. It also paid $0.25 per share in cash dividends in the third quarter, totaling $5.6 million. The company thus combined repurchases and cash dividends during the period, tying its expected pace to the remainder of the existing authorization.
The chief executive said funding business growth is the top capital priority, followed by share repurchases and then small dividends. The chief financial officer said the first priority is funding growth in high-margin insurance businesses, and the second is returning excess capital to shareholders, primarily through buybacks. He added that the company has no interest in mergers and acquisitions. He said the debt-to-total-capital ratio is about 10%. The chief executive said the quarter’s underwriting results reflect “discipline in a competitive market,” adding that underwriting margins and investment income allow the company to return capital to shareholders.
Gross written premiums fell 4.8% to $462.9 million in the third quarter, while net written premiums declined 1.5% to $399.1 million. By contrast, net earned premiums rose 3.0% to $423.5 million. The company attributed the decline in gross written premiums mainly to intensified competition in property lines, where premiums fell 19.3% during the quarter. In commercial property, the decline was 26.8%. The figures show that weakness in written premiums was concentrated in property, while net earned premiums grew over the same period.
On profitability, diluted operating earnings per share rose 9.4% year over year to $5.70 in the third quarter, while diluted earnings under generally accepted accounting principles fell 28.4%. Annualized return on equity was 26.6% for the nine months ended September 30, 2026, while annualized operating return on equity was 25.6%. Net investment income rose 17.5% to $58.3 million. The combined ratio was 75.4%, compared with 74.9% in the third quarter of 2025. In the year-earlier period, gross written premiums had increased 8.4% to $486.3 million, underscoring the shift to a decline in the current quarter.
The quarter’s results included a pretax realized loss of $37.6 million from the sale of fixed-income securities as part of a repositioning of the investment portfolio. The company said the move is expected to improve long-term returns. On October 23, Kinsale shares fell 6.18% to $366.49, compared with a previous close of $390.64, according to Investing.com. The report linked the share decline to slower premium growth, market pressure and the loss related to the investment portfolio. The company had scheduled a call to discuss its results for October 23, 2026, at 9:00 a.m. Eastern time.