Bowhead reports net income and GWP growth in Q3’24

Bowhead Specialty, a provider of casualty and professional liability products, has announced its financial results for the third quarter of 2024, reporting a net income of $12.1 million and a 32.3% increase in gross written premiums (GWP).

The firm’s net income for the quarter saw a 38.9% increase compared to the $8.7 million reported in Q3 2023. GWP for Q3 2024 increased to $197 million from $148.9 million in the same period last year.

Net written premiums grew to $128.3 million compared to the $99.3 million seen in the third quarter of 2023.

Total revenues for this year’s third quarter were $105.1 million, a 48.4% growth when compared to the $76 million reported in Q3 2023.

Bowhead noted that the 32.3% increase in GWP in Q3 2024 was driven by new business, renewals and continued growth in its platform across all divisions.

Casualty led the growth with a 41.7% increase to $120.2 million, which included $4.4 million of additional GWP ($3.3 million from a net earned premium basis) from an unusually large audit premium on one insured.

Healthcare Liability GWP grew 29% year over year, to $31.4 million while Professional Liability GWP grew 13.1% year over year, to $45 million.

Bowhead also noted the launch of its new division called Baleen Specialty – which focuses on small, hard-to-place risks written 100% on a non-admitted basis – towards the end of this year’s second quarter.

Baleen Specialty, in line with Bowhead’s deliberate, measured and limited roll out, generated $0.4 million of gross written premiums for the third quarter of 2024.

The insurer also reported the Group’s loss ratio increased this quarter, to 64.5% from 60.4% in Q3 2024, which utilised the same industry loss ratios used since the fourth quarter of 2023.

“The decrease from 65.5% in the second quarter of 2024 was primarily driven by mix changes in the portfolio, as well as the large audit premium being fully earned and associated with older accident years that had lower loss pick assumptions. There were no changes to loss picks or prior year reserves during the quarter. As of September 30, 2024, incurred but not reported liabilities comprised 91.2% of our net loss reserves,” Bowhead stated.

The company’s expense ratio of 29.9% in Q3 2024 decreased from 33.8% in Q2 2024. Combined ratio for the quarter increased to 94.4% compared to the 91.4% reporter in Q3 2023.

In its preliminary third quarter earnings report, Bowhead stated that there was no expectation of material direct losses from the recent hurricanes in this quarter, as the firm does not write any property risks.

Bowhead Chief Executive Officer, Stephen Sills, commented: “We are pleased to share our third quarter results, which reflect the continued execution of our market cycle strategy. Premium growth in the quarter was 32% year over year. Our Casualty division had a standout quarter, as we continue to see favourable underwriting and pricing conditions.

“We also experienced double-digit premium growth in our Healthcare Liability and Professional Liability divisions. As mentioned in the past, underwriting comes first here at Bowhead. From the top down, underwriting profitability is our North Star and is embedded in our people and our culture.”

Sills concluded: “Looking ahead, with our disciplined approach to underwriting and our expanding “craft” and Baleen Specialty “flow” platforms, we believe we’re well positioned for sustainable and profitable growth across market cycles.”

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