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ProAssurance Q4 Earnings Beat Estimates on Declining Expenses
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Key Takeaways
PRA reported Q4 adjusted EPS of 82 cents, beating estimates as income jumped 115.8% YoY.
ProAssurance saw net investment income rise 9.1% and total expenses fall 17.8%.
PRA's combined ratio improved to 92.3%, while book value per share rose 11.7%.
ProAssurance Corporation (PRA - Free Report) reported a fourth-quarter 2025 adjusted operating income of 82 cents per share, which beat the Zacks Consensus Estimate of 22 cents. The bottom line rose 115.8% year over year.
Operating revenues of $271.6 million dipped 5.6% year over year. However, the top line beat the consensus mark by 3.9%.
The better-than-expected quarterly results benefited from rising investment income and a decline in expenses. However, the upside was partially offset due to lower premiums, especially in the Specialty P&C segment, the Workers' Compensation Insurance segment and the Segregated Portfolio Cell Reinsurance unit.
ProAssurance Corporation Price, Consensus and EPS Surprise
Gross premiums written fell 3% year over year to $201.5 million. Net premiums earned of $232.1 million tumbled 3.7% year over year. Yet the reported figure topped the Zacks Consensus Estimate of $231.5 million.
Net investment income advanced 9.1% year over year to $40.2 million in the quarter under review on the back of improved average book yields. The metric beat the consensus mark of $39.3 million.
Total expenses came in at $223 million, which decreased 17.8% year over year. The year-over-year decrease was backed by lower net losses and loss adjustment expenses.
ProAssurance’s net income surged 106.4% year over year to $33.4 million. The combined ratio improved to 92.3% from 109.3% in the year-ago period.
ProAssurance’s Segmental Update
Specialty P&C Segment
The segment recorded revenues of $180.3 million in the fourth quarter, which slipped 3.8% year over year. The metric beat the Zacks Consensus Estimate of $175.2 million. Net premiums earned decreased 2.7% year over year to $180.8 million but beat the consensus mark of $174.2 million.
Total expenses came in at $147.9 million, which fell 23.7% year over year. The unit recorded a profit of $32.4 million against the year-ago loss of $6.5 million. The combined ratio improved to 79.9% from 99.9% in the year-ago period.
Workers' Compensation Insurance Segment
Revenues in the segment fell 5.1% year over year to $41.1 million in the quarter under review. The metric missed the Zacks Consensus Estimate of $41.7 million. Net premiums earned of $40.3 million declined 6.1% year over year, lower than the consensus mark of $41.3 million.
Total expenses dipped 7.2% year over year to $46.9 million. The unit incurred a loss of $5.7 million, narrower than the prior-year quarter’s loss of $7.2 million. The combined ratio improved 130 bps year over year to 116.3%.
Segregated Portfolio Cell Reinsurance Segment
The segment’s gross premiums written of $11.1 million declined 11.1% year over year. Net premiums earned tumbled 11% year over year to $11 million, which beat the Zacks Consensus Estimate by 0.2%.
Underwriting, policy acquisition and operating expenses amounted to $3.9 million in the fourth quarter, which fell 1.8% year over year. The unit reported a quarterly profit of $1.5 million, which surged 114.8% year over year. The combined ratio improved to 67.4% from 80.5% in the year-ago period.
Corporate Segment
Net investment income of the unit grew 9% year over year to $39.1 million.
Operating expenses of $10.5 million rose 10% year over year. The unit’s profit dropped 75.9% year over year to $7 million. Interest expenses fell 2.3% year over year to $5.2 million.
PRA’s Financial Position (As of Dec. 31, 2025)
ProAssurance exited the fourth quarter with cash and cash equivalents of $36.5 million, which dipped 33.5% from the 2024-end level. Total investments were $4.4 billion, up 1.4% from the figure at 2024-end.
Total assets of $5.4 billion dipped 2.3% from the 2024-end level.
Debt less unamortized debt issuance costs amounted to $420.4 million, down 1% from the figure as of Dec. 31, 2024.
Total shareholders’ equity of $1.3 billion advanced 12.3% from the level at 2024-end.
Net cash used in operating activities amounted to $25.6 million for 2025, while the company used $10.5 million of net cash in operations in the prior-year comparable period.
Book value per share was $26.24 as of Dec. 31, 2025, which grew 11.7% from the 2024-end figure. Adjusted operating return on equity improved 630 bps year over year to 12.8% in the quarter under review.
ProAssurance’s Share Repurchase Update
ProAssurance did not repurchase any common shares in 2025. A leftover capacity of $55.9 million remained in place to be utilized for common share repurchases or retirement of outstanding debt as of Dec. 31, 2025.
Full-Year 2025 Update of PRA
For 2025, adjusted operating income per share improved 65.3% from a year ago to $1.62. Total revenues declined 4.6% year over year to $1.1 billion.
Several companies in the insurance space, including RenaissanceRe Holdings Ltd. (RNR - Free Report) , MetLife, Inc. (MET - Free Report) and Everest Group, Ltd. (EG - Free Report) , have already reported their financial results for the December quarter of 2025. Here’s how they had performed:
RenaissanceRe reported fourth-quarter 2025 operating income of $13.34 per share, which surpassed the Zacks Consensus Estimate by 26%. The bottom line surged 65.5% year over year. The results were aided by a rise in net investment income and strong underwriting results. Total expenses dropped year over year, thanks to declines in claims expenses, and acquisition and operational costs. However, the upside is partly offset by RNR’s lower premiums in general casualty and specialty lines, and the Property segment.
MetLife reported fourth-quarter 2025 adjusted operating earnings per share of $2.58, which beat the Zacks Consensus Estimate by 9.3%. The bottom line advanced 24% year over year. The quarterly earnings were aided by strong performance in its Asia, Group Benefits, RIS and EMEA segments, driven by higher volumes and improved investment income. An increase in adjusted premiums, fees and other revenues contributed to the upside. However, MET’s upside was partly offset by a VAT charge in Mexico that inflicted pressure on adjusted earnings in the Latin America unit.
Everest Group reported a fourth-quarter 2025 operating income of $13.26 per share, missing the Zacks Consensus Estimate by 0.8%. The bottom line reversed the year-ago loss of $18.39. EG benefited from the strong-performing Reinsurance segment, along with solid core fixed-income investment returns. These positives were partially offset by weak performance in the insurance businesses, higher expenses and underwriting losses.
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ProAssurance Q4 Earnings Beat Estimates on Declining Expenses
Key Takeaways
ProAssurance Corporation (PRA - Free Report) reported a fourth-quarter 2025 adjusted operating income of 82 cents per share, which beat the Zacks Consensus Estimate of 22 cents. The bottom line rose 115.8% year over year.
Operating revenues of $271.6 million dipped 5.6% year over year. However, the top line beat the consensus mark by 3.9%.
The better-than-expected quarterly results benefited from rising investment income and a decline in expenses. However, the upside was partially offset due to lower premiums, especially in the Specialty P&C segment, the Workers' Compensation Insurance segment and the Segregated Portfolio Cell Reinsurance unit.
ProAssurance Corporation Price, Consensus and EPS Surprise
ProAssurance Corporation price-consensus-eps-surprise-chart | ProAssurance Corporation Quote
PRA’s Q4 Operational Update
Gross premiums written fell 3% year over year to $201.5 million. Net premiums earned of $232.1 million tumbled 3.7% year over year. Yet the reported figure topped the Zacks Consensus Estimate of $231.5 million.
Net investment income advanced 9.1% year over year to $40.2 million in the quarter under review on the back of improved average book yields. The metric beat the consensus mark of $39.3 million.
Total expenses came in at $223 million, which decreased 17.8% year over year. The year-over-year decrease was backed by lower net losses and loss adjustment expenses.
ProAssurance’s net income surged 106.4% year over year to $33.4 million. The combined ratio improved to 92.3% from 109.3% in the year-ago period.
ProAssurance’s Segmental Update
Specialty P&C Segment
The segment recorded revenues of $180.3 million in the fourth quarter, which slipped 3.8% year over year. The metric beat the Zacks Consensus Estimate of $175.2 million. Net premiums earned decreased 2.7% year over year to $180.8 million but beat the consensus mark of $174.2 million.
Total expenses came in at $147.9 million, which fell 23.7% year over year. The unit recorded a profit of $32.4 million against the year-ago loss of $6.5 million. The combined ratio improved to 79.9% from 99.9% in the year-ago period.
Workers' Compensation Insurance Segment
Revenues in the segment fell 5.1% year over year to $41.1 million in the quarter under review. The metric missed the Zacks Consensus Estimate of $41.7 million. Net premiums earned of $40.3 million declined 6.1% year over year, lower than the consensus mark of $41.3 million.
Total expenses dipped 7.2% year over year to $46.9 million. The unit incurred a loss of $5.7 million, narrower than the prior-year quarter’s loss of $7.2 million. The combined ratio improved 130 bps year over year to 116.3%.
Segregated Portfolio Cell Reinsurance Segment
The segment’s gross premiums written of $11.1 million declined 11.1% year over year. Net premiums earned tumbled 11% year over year to $11 million, which beat the Zacks Consensus Estimate by 0.2%.
Underwriting, policy acquisition and operating expenses amounted to $3.9 million in the fourth quarter, which fell 1.8% year over year. The unit reported a quarterly profit of $1.5 million, which surged 114.8% year over year. The combined ratio improved to 67.4% from 80.5% in the year-ago period.
Corporate Segment
Net investment income of the unit grew 9% year over year to $39.1 million.
Operating expenses of $10.5 million rose 10% year over year. The unit’s profit dropped 75.9% year over year to $7 million. Interest expenses fell 2.3% year over year to $5.2 million.
PRA’s Financial Position (As of Dec. 31, 2025)
ProAssurance exited the fourth quarter with cash and cash equivalents of $36.5 million, which dipped 33.5% from the 2024-end level. Total investments were $4.4 billion, up 1.4% from the figure at 2024-end.
Total assets of $5.4 billion dipped 2.3% from the 2024-end level.
Debt less unamortized debt issuance costs amounted to $420.4 million, down 1% from the figure as of Dec. 31, 2024.
Total shareholders’ equity of $1.3 billion advanced 12.3% from the level at 2024-end.
Net cash used in operating activities amounted to $25.6 million for 2025, while the company used $10.5 million of net cash in operations in the prior-year comparable period.
Book value per share was $26.24 as of Dec. 31, 2025, which grew 11.7% from the 2024-end figure. Adjusted operating return on equity improved 630 bps year over year to 12.8% in the quarter under review.
ProAssurance’s Share Repurchase Update
ProAssurance did not repurchase any common shares in 2025. A leftover capacity of $55.9 million remained in place to be utilized for common share repurchases or retirement of outstanding debt as of Dec. 31, 2025.
Full-Year 2025 Update of PRA
For 2025, adjusted operating income per share improved 65.3% from a year ago to $1.62. Total revenues declined 4.6% year over year to $1.1 billion.
PRA’s Zacks Rank
PRA currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
How Did Peers Perform?
Several companies in the insurance space, including RenaissanceRe Holdings Ltd. (RNR - Free Report) , MetLife, Inc. (MET - Free Report) and Everest Group, Ltd. (EG - Free Report) , have already reported their financial results for the December quarter of 2025. Here’s how they had performed:
RenaissanceRe reported fourth-quarter 2025 operating income of $13.34 per share, which surpassed the Zacks Consensus Estimate by 26%. The bottom line surged 65.5% year over year. The results were aided by a rise in net investment income and strong underwriting results. Total expenses dropped year over year, thanks to declines in claims expenses, and acquisition and operational costs. However, the upside is partly offset by RNR’s lower premiums in general casualty and specialty lines, and the Property segment.
MetLife reported fourth-quarter 2025 adjusted operating earnings per share of $2.58, which beat the Zacks Consensus Estimate by 9.3%. The bottom line advanced 24% year over year. The quarterly earnings were aided by strong performance in its Asia, Group Benefits, RIS and EMEA segments, driven by higher volumes and improved investment income. An increase in adjusted premiums, fees and other revenues contributed to the upside. However, MET’s upside was partly offset by a VAT charge in Mexico that inflicted pressure on adjusted earnings in the Latin America unit.
Everest Group reported a fourth-quarter 2025 operating income of $13.26 per share, missing the Zacks Consensus Estimate by 0.8%. The bottom line reversed the year-ago loss of $18.39. EG benefited from the strong-performing Reinsurance segment, along with solid core fixed-income investment returns. These positives were partially offset by weak performance in the insurance businesses, higher expenses and underwriting losses.