AXIS Capital Holdings Limited Q1 FY2026 earnings call

• Axis started 2026 strongly with benefits from operating model enhancements and investments in products, distribution, technology, and talent. Portfolio remediation largely complete, book of business premium adequate, resilient, and positioned for profitable growth.
• Insurance business grew in core, expanded classes, and ACS. Different lines of business have varying conditions: property pricing down 13% but business meets underwriting return expectations, liability rates grew, professional lines had rate positives, cyber remained cautious. Reinsurance drove selective growth in specialty product set, actively managed cycle in casualty lines.
• In How We Work program, AI strategy focuses on creating efficiency, enhancing productivity, and delivering risk insights. AI investments contribute to expense ratio efficiency via automation in underwriting and operations.
• Key takeaways: Built for all seasons, positioned for continued profitable growth, disciplined underwriting culture, global multivariate distribution platform, culture prioritizing performance and people.

Insurance: Strong quarter with premium generations of $1.98 billion, underwriting income of $157 million (+17% YOY), combined ratio 86.3 (improved 0.4 pts YOY). Gross written premiums up ~20% YOY, driven by core business, expanded classes, and access capacity solutions (ACS). Short tail lines now 60% of overall premiums. Reinsurance: Drove $1.1 billion in gross written premiums, short tail lines growing from 50% to 61% YOY. Produced combined ratio 92.7, underwriting income $30 million, fee income $20 million. Drove growth in targeted lines like A&H and credit insurity, reduced writings in casualty lines due to competitive market and unmet risk-adjusted returns.

• Full year target for consolidated G&A ratio is 11%.
• Reinsurance premiums expected to be down double digits in 2026.
• Underlying loss ratio in insurance expected to remain at the level guided in Q4.
• Share repurchases will first support organic growth and then be opportunistic based on share price value.

• Pricing pressure in several lines.
• Geopolitical uncertainty affecting certain lines of business.
• Technological disruption creating new exposures and opportunities.
• Cyber risks intensified by AI, with challenges in underwriting middle market and small commercial concerns.
• Middle East exposure needs close monitoring.
• Reinsurance market competitive with risk-adjusted returns not meeting expectations.
• AI application related risks in terms of responsible adoption and potential unforeseen issues.

Q: Andrew Kligerman asked about reserve development and developments from 2021 - 2024.

A: Matt said ~18 million reserve development in quarter mostly from short tail lines, Vince added they've had actions leading to reserve charge in 2023, have tools and insights for quarterly reviews and are cautious in casualty classes.

Q: Rob Cox asked about funds at Lloyd's opportunity and impact on underlying loss ratio.

A: Matt said foul deals are in line with pricing hurdles and won't change loss ratio expectation, Vince added core growth components have good loss ratio performance with analytics support.

Q: Elise Greenspan asked about premium growth away from ACS and capital allocation for buybacks.

A: Matt said underlying portfolio guided to low single digits growth, expanded lines to high single digits, buybacks will first support organic growth then be opportunistic based on share price value.

Q: Roland Mayor asked about buybacks in January and run rate.

A: Vince and Matt said buybacks are opportunistic, guided by strategic focus and board authorization shows confidence in profitable growth journey.

Q: Josh Shanker asked about capital deployment for growth and multi-year plans.

A: Vince said ~50% of earnings generated will be needed to support growth, will remain agile and shareholder focused.

Q: Charlie Lederer asked about G&A ratio and AI spend.

A: Matt said expense ratio came in at 10.7% due to technology investments including AI enabling more business on same expense base, Vince added will continue to invest in people and capabilities but expect GA ratio around 11% for year.

Q: Henri Gavichelli asked about top-line growth in insurance and long-term profitability.

A: Vince said will not grow for sake of growth, will grow guided by diluted book value per share growth and risk-adjusted returns meeting hurdle rates.

Q: Meyer Shields asked about cyber insurance and Middle East conflict.

A: Vince said cyber has cautious view, $6 million growth is relatively flat, Middle East conflict has had modest writings, reserves conservatively pecked with no movements in Baltimore Bridge loss reserves other than reinstatement premiums.

Q: Andrew Anderson asked about sensitivity of loss ratio to property pricing deterioration and paid to incurred ratio.

A: Vince said will signal if rate deterioration extends beyond tolerance, Matt said paid to incurred ratio is one data point of many and volatile, company looks at multiple metrics to manage