Kingstone Companies NASDAQ: KINS reported a first-quarter 2026 net loss as an unusually severe winter storm season across the Northeast drove elevated catastrophe losses, though management emphasized continued improvement in underlying underwriting performance and premium growth.
First-quarter results reflected heavy winter catastrophe activity
President and CEO Meryl Golden said the company posted a GAAP net combined ratio of 112 for the first quarter, with a net loss of $5.8 million, or $0.40 per diluted share. Golden attributed the quarterly loss primarily to “11 winter catastrophe events across the Northeast,” which contributed 26 points to the loss ratio. She added that the winter storm season was “exceptionally severe for downstate N.Y.” and “ranked as the coldest and snowiest in 11 years.”
Vice President and CFO Randy Patten similarly said the quarter included a 112% combined ratio and an annualized return on equity of -19.6%. He noted catastrophe losses added 26 points to the combined ratio in the quarter, compared with 1.7 points in the prior-year period.
On reinsurance, Golden said the company’s gross catastrophe loss was “about $25 million.” She said Kingstone purchased “first event winter storm coverage,” resulting in a “$5 million recovery,” and added the company had “roughly $4 million, maybe $5 million going into the reinsurance tower.”
Management highlighted improved “underlying” underwriting performance
Golden told investors the company is emphasizing its “underlying combined ratio” to separate results it can control from catastrophe volatility, and said “every key metric improved” on that basis. She reported:
- Underlying combined ratio improved 5.1 points year-over-year to 88.3%.
- Underlying loss ratio improved to 57.9%.
- Expense ratio improved to 30.4%.
Patten said that removing the impacts of catastrophe losses and favorable reserve development, Kingstone’s underlying combined ratio improved to 88.3% from 93.4% in the first quarter of 2025. He added the underlying loss ratio improvement was supported by “low non-catastrophe loss frequency, higher average premium, and continued discipline in underwriting.”
Both executives also pointed to favorable prior-year reserve development of 2.3 points during the quarter, compared with 1.4 points in the prior-year quarter.
Golden said non-catastrophe claim frequency “continues to be very low,” though “up modestly” from the prior-year quarter and in line with full-year 2025. She added that, adjusted for inflation, non-catastrophe severity was comparable to the prior-year quarter.
Golden also highlighted performance of the company’s Select homeowners product, saying Select claim frequency on an inception-to-date basis is “more than 33% lower than our legacy product.” She noted Select represents “only 60% of our policies in force today,” which she said “bodes well for the future.”
Premium growth, investment income, and expense leverage
Golden said direct premiums written increased by almost 20% in the quarter, driven by momentum in New York personal lines. She cited new business policies up 19% year-over-year, average renewal premium up 10%, and retention improving by about a point. Policies in force increased more than 7% year-over-year to more than 82,000, and were up 2.5% from year-end.
Golden said a renewal rights transaction contributed approximately $2.5 million of direct premiums written during the quarter, representing about 4% of the growth, while “our organic growth in New York was a very strong 16%.” In response to an analyst question, she said growth continued into the second quarter and was at “a even a slightly higher premium growth than we’ve been experiencing.”
Net premiums earned rose 28% to $55.9 million, Patten said, driven by premium growth and a reduced quota share cession. Golden explained that for the 2026 treaty year the company reduced its quota share from 16% to 5% for its core New York business. Patten added that, financially, the reduction in quota share contributed approximately $0.20 of incremental earnings per share for the full year, and that impact is included in the company’s 2026 guidance.
Investment income also increased. Golden said investment income rose 63% during the quarter, and Patten reported net investment income increased 63% to $3.3 million from $2 million a year earlier. Patten said the company’s investment portfolio grew to $313.4 million, aided by cash generation and higher fixed-income yields. As of March 31, the portfolio yield was 4.3%, up from 3.7% a year earlier, with an effective duration of 4.3 years.
On expenses, Patten said the first-quarter expense ratio improved by 0.9 percentage points year over year to 30.4% as the company realized economies of scale. He also noted Kingstone’s expense ratio was 41% in 2021. Addressing an analyst question about higher “other operating expenses,” Patten said the increase was “a one-time expense” tied to “some board-level projects” and not expected to continue.
Capital position, book value, and dividend
Patten said Kingstone ended the quarter with no debt at the holding company. Shareholders’ equity was $114.5 million at quarter-end. Book value per diluted share was $7.70 at March 31, down $0.58 from December 31, 2025, but up 38% from $5.57 at March 31, 2025. Excluding accumulated other comprehensive income (AOCI), book value per diluted share was $8.23, up 32% from the prior year.
In response to a question about AOCI, Patten said a $2 million loss in AOCI was tied to “higher interest rates marking down the bonds.”
Patten added that the company declared its fourth consecutive quarterly dividend in April 2026 and said the company has “ample capital” to fund its growth initiatives.
Expansion plans: California and Connecticut; reaffirmed 2026 guidance
Golden said the company remains on track to enter California in the second quarter on an excess and surplus (E&S) lines basis, describing California as “one of the largest homeowner markets in the country,” with the “fastest-growing excess and surplus lines market for homeowners.” She said the company plans to start with a small number of agencies that are existing Kingstone partners in New York and has arranged a 30% quota share for California “out of an abundance of conservatism.” Golden said California volume is expected to be “less than 5% for 2026.”
Asked about competition in California’s E&S market, Golden said the state is a “$15 billion in homeowners premium” market and that there is “a huge need for capacity.” She said she did not expect increased competition to change demand for Kingstone’s product in the near term, adding the company will adjust as needed because it is “very nimble.” Golden said Kingstone created a “Select product specific for California” and emphasized that it is “a company, not an MGA,” with a focus on long-term relationships with independent agents.
Golden also said Kingstone recently incorporated Kingstone America Insurance Company, a new subsidiary domiciled in Connecticut, giving the company flexibility to write business on both an admitted and non-admitted basis. She said the company expects to begin writing admitted homeowners business in Connecticut in the third quarter, citing a “friendly regulatory environment” and producer feedback that the company would be “adversely selected against as an E&S writer.”
Golden said the company is reaffirming all elements of its full-year 2026 guidance issued March 5, including:
- Direct premiums written growth of 15% to 20%
- Underlying combined ratio of 74% to 76%
- Catastrophe loss ratio of seven to 10 points
- Diluted EPS of $2.20 to $2.90
- Return on equity of 24% to 30%
Golden noted that “each one point of catastrophe loss ratio has an approximate $0.13 per share impact on diluted earnings per share,” and said the company’s earnings power is concentrated in the second through fourth quarters due to typical seasonality. In the Q&A, she added that catastrophe activity in the second quarter is typically low and said, “as far as I know, so far this quarter, there have been no catastrophe events.”
About Kingstone Companies NASDAQ: KINS
Kingstone Companies, Inc is a publicly traded property and casualty insurance holding company whose primary focus lies in personal and commercial insurance products. Through its wholly owned subsidiary, Kingstone Insurance Company, the firm underwrites a broad portfolio of property and casualty lines, including private passenger auto, homeowners, inland marine, umbrella, and various small‐commercial coverage options. Distribution is handled predominantly through a network of independent agents, allowing Kingstone to maintain strong broker relationships and responsive service for policyholders.
The company was incorporated in Delaware in 2010 and commenced operations following the acquisition of Kingstone Insurance Company in early 2011.
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