Bermuda-based reinsurer Conduit Re’s full-year 2025 gross written premiums (GPW) rose 6.9%, with the company’s undiscounted combined ratio rising 4.4 percentage points to 101.5%, driven by modest growth in property and casualty, which contributed 15.3% to January’s undiscounted net loss ratio from the California wildfires.
By 2025, total gross profit margin for the entire group will increase to US$1.243 billion, compared with US$1.162 billion in the same period last year. Casualty premiums increased 23% year-on-year to US$392.3 million, and property premiums increased 2.2% to US$659.4 million, partially offset by a 3.6% decrease in special premiums to US$191.3 million.
On the casualty front, Conduit Re highlighted growth in its general third-party liability business with preferred partners in 2025 and attributed slower property growth to weaker prices and increased competition in the reinsurance industry. The company chose to reduce specialty product growth as certain product lines faced greater pressure on pricing and terms.
Regular readers will be aware that pricing levels and terms and conditions have softened in 2025 across most business categories, with conditions in the real estate and professional sectors being particularly competitive after several years of strong rate growth and strong profits.
As a result, Conduit Re’s overall risk-adjusted rate change (net of claims inflation) for 2025 was -3%, driven by a 5% decline in property and a 5% decline in professional business, partially offset by a 1% increase in casualties, which Conduit Re noted was driven by market corrections as reserves deteriorated and losses emerged.
Reinsurance revenue increased 10.2% year over year to $897.1 million in 2025, while net reinsurance revenue increased 8.1% year over year to $778 million, with all three business segments generating higher revenue. Ceded reinsurance expenses increased year over year from $93.7 million to $119.1 million, driven by additional limits purchased as a result of the company’s growth in its onshore portfolio risk exposure, as well as broader outside coverage purchased during the year related to secondary risks.
CEO Neil Eckert said: “We updated our core retrocession program for 2026 with enhanced coverage for peak and secondary disasters, such as the California wildfires, to increase our portfolio resiliency and better manage earnings fluctuations. In addition to strengthening our team, this is important work.”
Net expenses for reinsurance services increased from $588.4 million in 2024 to $668.1 million in 2025 as reinsurance losses and loss-related amounts increased from $530.9 million to $623.2 million. Conduit Re highlighted that 2025 will be another active year for natural disaster losses, especially severe convective storm activity in the United States and the California wildfires in January 2025. The company’s undiscounted net loss after reinsurance and restoration premiums was $119.1 million.
The company’s reinsurance services results for 2025 reached $109.9 million, down more than 16% from $131.6 million a year earlier, as the undiscounted combined ratio increased to 101.5% in 2025 from 97.1% a year earlier. In 2025, the company’s discounted combined ratio will increase by 3.1 percentage points to 89.1%.
On the asset side of the balance sheet, Conduit Re’s net investment results for 2025 were $119.5 million, a significant increase of 80.8% over the previous year.
The group’s overall comprehensive income will decrease by 7% from US$125.6 million in 2024 to US$116.8 million in 2025, with a return on equity of 11.1%.
“After a difficult start to 2025, we are pleased to have achieved 11.1% RoE this year. This result reflects our losses from the California wildfires, the largest loss absorption in Conduit’s history, and our ex post retrocession purchases. Our earnings were supported by strong investment performance, with a net return of 6.7% in 2024, net investment income growth of 24.2%, and healthy claims activity in the second half of 2024. 2025 years,” Eckert said.
“Conduit’s January renewal season was a success. We attracted select new business while continuing to support our key partners in more meaningful ways. At the same time, underwriting discipline remains our top priority. With markets softening in 2025 and 2026, our growth rate slowed as we reduced or exited business that did not meet our pricing or performance standards. We are pleased with our start to 2026 against the backdrop of more competitive market conditions.”
“Going forward, we will deploy our capital prudently or return it to shareholders as appropriate. Our balance sheet remains strong and we remain interested in share repurchases,” he added.