Berkley profit falls as cats hit; premium rises

W.R. Berkley Corp. reported lower net income for the first quarter due to catastrophe losses, but the insurer’s revenue rose as premium rates continued to increase in several lines.

Ahead, loss costs may increase due to the imposition of tariffs, but the situation remains fluid, the company’s top executive said on a call with analysts late Monday.

Berkley reported net income of $417.6 million for the quarter, a 5.6% decline compared with the same period last year. The company incurred $111 million in catastrophe losses for the quarter, primarily attributable to the California wildfires that began in January.

The company reported a combined ratio of 90.9%, deteriorating from 88.8% in last year’s quarter. Net investment income rose 12.6% to $360.3 million.

Berkley reported net written premium of $3.13 billion, a 9.9% increase over the 2024 quarter. Its insurance sector grew 10.2%, and its reinsurance and monoline excess sector rose 8.2%.

Increased rates contributed to the premium increase, with average rates, excluding workers compensation, rising 8.3% in the quarter, said W. Robert Berkley Jr., president and CEO. However, he said that rates for directors and officers liability, cyber liability, and transactional liability insurance fell during the quarter.

The Trump administration’s policy on import tariffs is a “very fluid situation,” and the insurer is paying close attention to developments, Mr. Berkley said.

“As that comes into sharper focus, that may be instructive to us as to how we think about both loss ratio as well as rate need,” he said.

Several industry observers and executives have previously said they expect higher tariffs to increase loss costs if imported replacement parts and materials become more expensive.

While property and auto liability lines could be affected by tariffs, workers comp could also be hit, Mr. Berkley said. “A lot of drugs are manufactured outside of the United States,” he said.