RLI Reports First Quarter 2021 Results
RLI Corp. reported first quarter 2021 net earnings of $73.0 million ($1.60 per share), shifting from a net loss of $61.3 million (-$1.36 per share) in Q1 2020. Operating earnings rose to $39.6 million ($0.87 per share), compared to $29.8 million ($0.66 per share) last year. Underwriting income hit $29.9 million with a combined ratio of 86.9. Notably, gross premiums written increased by 20% and book value per share grew to $25.55. Despite challenges from winter storms, RLI aims to maintain underwriting profitability.
- Net earnings increased to $73.0 million from a loss of $61.3 million.
- Operating earnings rose to $39.6 million, up from $29.8 million.
- Underwriting income reached $29.9 million on a combined ratio of 86.9.
- Gross premiums written increased by 20%, showing strong growth.
- Book value per share rose to $25.55, a 2% increase from the previous year.
- Net investment income decreased by 7.6% to $16.4 million.
- Losses from winter storms led to a $13.6 million net decrease in underwriting income.
RLI Corp. (NYSE: RLI) – RLI Corp. reported first quarter 2021 net earnings of
|
First Quarter |
|
|||||
Earnings Per Diluted Share |
2021 |
|
|
2020 |
|
||
Net earnings (loss) |
$ |
1.60 |
|
|
$ |
(1.36 |
) |
Operating earnings (1) |
$ |
0.87 |
|
|
$ |
0.66 |
|
(1) See discussion below: Non-GAAP and Performance Measures. |
|||||||
Highlights for the quarter included:
-
Underwriting income(1) of
$29.9 million on a combined ratio(1) of 86.9. -
Gross premiums written increased
20% , up10% when adjusting for the return of premium to transportation customers impacted by the pandemic in 2020. -
Net favorable development in prior years’ loss reserves, resulting in a
$31.4 million net increase in underwriting income. -
Losses from winter storms, resulting in a
$13.6 million net decrease in underwriting income. -
Book value per share of
$25.55 , an increase of2% (inclusive of dividends) from year-end 2020.
“We are proud to report excellent first quarter results,” said RLI Corp. Chairman and CEO Jonathan E. Michael. “Despite an active winter storm season, we achieved an 87 combined ratio while continuing to find growth opportunities across our portfolio. Premium volume was up over last year in all three segments, primarily driven by rate increases and expanded distribution. Looking ahead, we will continue to build on our 25 consecutive years of underwriting profitability and focus on growing book value, which is possible through the dedication of our employee owners.”
Underwriting Income
RLI achieved
Results for both years include net favorable development in prior years’ loss reserves, which totaled
The following table highlights underwriting income and combined ratios by segment.
Underwriting Income (Loss)(1) |
|
|
Combined Ratio(1) |
|
||||||||||||||
(in millions) |
|
2021 |
|
|
2020 |
|
|
|
|
2021 |
|
|
2020 |
|
||||
Casualty |
|
$ |
24.9 |
|
|
$ |
(1.3 |
) |
|
Casualty |
|
|
83.3 |
|
|
|
100.9 |
|
Property |
|
|
(1.0 |
) |
|
|
9.9 |
|
|
Property |
|
|
101.9 |
|
|
|
77.7 |
|
Surety |
|
|
6.0 |
|
|
|
8.6 |
|
|
Surety |
|
|
78.5 |
|
|
|
68.9 |
|
Total |
|
$ |
29.9 |
|
|
$ |
17.2 |
|
|
Total |
|
|
86.9 |
|
|
|
92.0 |
|
(1) See discussion below: Non-GAAP and Performance Measures. |
||||||||||||||||||
Other Income
Net investment income for the quarter decreased
RLI’s comprehensive earnings were
Equity in earnings of Maui Jim, Inc., a producer of premium sunglasses, was
Dividends Paid in the First Quarter of 2021
On March 19, 2021, the company paid a regular quarterly dividend of
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 earnings per share (EPS) from operations consist of our GAAP net earnings adjusted by the net realized gains/(losses), net unrealized gains/(losses) on equity securities and taxes related thereto. Net earnings and net earnings per share are the GAAP financial measures that are most directly comparable to operating earnings and EPS from operations. A reconciliation of the operating earnings and EPS from operations to the comparable GAAP financial measures is included in the 2021 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 daylight time (CDT) tomorrow, April 22, 2021, RLI management will hold a conference call to discuss quarterly results with insurance industry analysts. Interested parties may listen to the discussion through the Internet at https://edge.media-server.com/mmc/p/32ig7qpn.
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, 2020.
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 45 consecutive years and delivered underwriting profits for 25 consecutive years. To learn more about RLI, visit www.rlicorp.com.
Supplemental disclosure regarding the earnings impact of specific items:
|
|
|
|
Reserve Development and
|
|
|||||
|
|
|
|
Three Months Ended March 31, |
|
|||||
(Dollars in thousands, except per share amounts) |
|
2021 |
|
|
2020 |
|
||||
Net favorable development in casualty prior years' reserves |
|
$ |
28.2 |
|
|
$ |
6.4 |
|
||
Net favorable development in property prior years' reserves |
|
$ |
6.1 |
|
|
$ |
4.8 |
|
||
Net favorable development in surety prior years' reserves |
|
$ |
2.8 |
|
|
$ |
4.0 |
|
||
|
|
|
|
|
|
|
|
|
|
|
Net incurred losses related to: |
|
|
|
|
|
{
"@context": "https://schema.org",
"@type": "FAQPage",
"name": "RLI Reports First Quarter 2021 Results FAQs",
"mainEntity": [
{
"@type": "Question",
"name": "What were RLI Corp.'s net earnings for Q1 2021?",
"acceptedAnswer": {
"@type": "Answer",
"text": "RLI Corp. reported net earnings of $73.0 million in Q1 2021."
}
},
{
"@type": "Question",
"name": "How did RLI Corp.'s operating earnings change from Q1 2020 to Q1 2021?",
"acceptedAnswer": {
"@type": "Answer",
"text": "Operating earnings increased from $29.8 million in Q1 2020 to $39.6 million in Q1 2021."
}
},
{
"@type": "Question",
"name": "What is RLI Corp.'s combined ratio for Q1 2021?",
"acceptedAnswer": {
"@type": "Answer",
"text": "The combined ratio for RLI Corp. in Q1 2021 was 86.9."
}
},
{
"@type": "Question",
"name": "How much did RLI Corp.'s gross premiums written increase in Q1 2021?",
"acceptedAnswer": {
"@type": "Answer",
"text": "Gross premiums written increased by 20% in Q1 2021."
}
},
{
"@type": "Question",
"name": "What was RLI Corp.'s book value per share in Q1 2021?",
"acceptedAnswer": {
"@type": "Answer",
"text": "The book value per share for RLI Corp. in Q1 2021 was $25.55."
}
}
]
}
FAQ
What were RLI Corp.'s net earnings for Q1 2021?
RLI Corp. reported net earnings of $73.0 million in Q1 2021.
How did RLI Corp.'s operating earnings change from Q1 2020 to Q1 2021?
Operating earnings increased from $29.8 million in Q1 2020 to $39.6 million in Q1 2021.
What is RLI Corp.'s combined ratio for Q1 2021?
The combined ratio for RLI Corp. in Q1 2021 was 86.9.
How much did RLI Corp.'s gross premiums written increase in Q1 2021?
Gross premiums written increased by 20% in Q1 2021.
What was RLI Corp.'s book value per share in Q1 2021?
The book value per share for RLI Corp. in Q1 2021 was $25.55.
RLI Corp.
NYSE:RLIRLI RankingsRLI Latest NewsOct 21, 2024
RLI Reports Third Quarter 2024 Results
Sep 30, 2024
RLI Third Quarter Earnings Release & Teleconference
Aug 8, 2024
RLI Declares Regular Dividend
Jul 22, 2024
RLI Reports Second Quarter 2024 Results
RLI Stock Data
8.16B
43.81M
4.38%
81.28%
0.95%
Insurance - Property & Casualty
Fire, Marine & Casualty Insurance
United States of America
PEORIA
| ||||