Heritage Insurance Holdings, Inc., a super-regional property and casualty insurance holding company, has reported its most profitable first quarter on record, with net income of $36.5 million in Q1’26, up 19.7% from $30.5 million in the prior-year quarter.
The company attributed the increase in net income to higher investment income and lower losses, partly offset by higher general and administrative expenses.
In Q1’26, gross premiums written decreased 2.6% to $346.7 million from $356.0 million in Q1’25, primarily driven by a reduction in commercial residential business, partly offset by higher gross premiums written in personal lines.
Gross premiums earned were broadly consistent with the prior-year quarter, declining slightly to $353.6 million from $353.8 million.
Similarly, net premiums earned remained relatively stable year over year, edging down to $199.7 million from $200 million.
Total revenue was relatively flat at $212.7 million, compared to $211.5 million.
Heritage’s net combined ratio improved 3.5 points to 81.0% from 84.5%, driven by a lower net loss ratio, partly offset by a higher net expense ratio.
The net loss ratio decreased to 45.9% from 49.7%, driven by lower net losses and LAE alongside relatively stable net premiums earned.
Meanwhile, the net expense ratio increased to 35.2% from 34.8%, primarily driven by higher human capital-related costs, partly offset by lower policy acquisition costs.
Net investment income increased 15.1% to $9.9 million from $8.6 million, driven mostly by a higher balance of invested assets.
Ernie Garateix, CEO of Heritage, said, “Our first quarter was the most profitable first quarter for the Company since becoming public in 2014. Our net loss ratio was also the lowest delivered in a first quarter since 2015 even with $37 million of weather related losses in the quarter. These results were derived from the consistent application of our strategic profitability initiatives established several years ago that focused on rate adequacy and underwriting discipline, allocating capital to products and geographies that maximize long-term returns, and targeting a balanced and diversified portfolio.
“As our strategic initiatives have taken hold, we have re-opened over 90% of our geographies as they have become rate adequate and through our disciplined underwriting program, the quality of the book of business has greatly improved. This strategy is delivering results with new business written rising 62.7% from the first quarter of 2025 and over 30.0% from fourth quarter of 2025. We have expanded geographically, added products, enhanced our data analytics and demonstrated our ability to perform during adverse weather and challenging market conditions. We are also extremely well positioned to take advantage of any market disruptions or emerging opportunities. With our capabilities and financial strength, we will focus on evaluating and allocating capital to profitable products or geographies and we are positioned to expand organically or as accretive business opportunities arise.”
