v3.26.1
General (Tables)
 6 Months Ended
Jun. 30, 2026
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Effects of Reinsurance
The effect of reinsurance on property and casualty premiums written and earned was as follows:

Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
(Amounts in thousands)
Premiums Written
Direct $1,616,772 $1,477,169 $3,182,902 $2,915,636 
Ceded(62,561)(3,939)(125,149)(160,735)
Assumed(1,977)(238)37,988 25,494 
     Net$1,552,234 $1,472,992 $3,095,741 $2,780,395 
Premiums Earned
Direct$1,543,986 $1,407,608 $3,041,638 $2,783,531 
Ceded(62,561)(54,405)(125,231)(161,099)
Assumed9,027 6,139 19,141 12,668 
     Net$1,490,452 $1,359,342 $2,935,548 $2,635,100 
The following table presents the components of net losses and loss adjustment expenses from the Palisades and Eaton wildfires as of June 30, 2026 and December 31, 2025 and for the six months ended June 30, 2026:
As of
June 30, 2026		As of
December 31, 2025		For the Six Months Ended June 30, 2026
(Amounts in thousands)
Gross losses and loss adjustment expenses (6)
$2,293,719 $2,191,752 $101,967 
Subrogation recoverable - Eaton fire (1) ***
(561,914)(537,506)(24,408)
Subrogation recovered and recoverable - Palisades fire (2) ***
(50,352)(48,026)(2,326)
Reinsurance recovered and recoverable (3)
(1,293,500)(1,293,500)— 
Net catastrophe losses and loss adjustment expenses on Eaton and Palisades fires before FAIR Plan (6)
$387,953 $312,720 $75,233 
— 
Company's share of FAIR Plan losses and loss adjustment expenses (4)
$97,276 $92,717 $4,559 
Recoupable portion of FAIR Plan losses and loss adjustment expenses (5)
(25,000)(25,000)— 
Net FAIR Plan losses and loss adjustment expenses$72,276 $67,717 $4,559 
— 
Net losses and loss adjustment expenses on Eaton and Palisades fires (6)
$460,229 $380,437 $79,792 
__________ 
(1)    The Company is actively pursuing subrogation against Southern California Edison ("SCE") on the Eaton fire. The Company recorded approximately $562 million in estimated subrogation recoveries, or approximately 55% of its estimated ultimate losses on the Eaton fire, as an offset against loss and loss adjustment expense reserves in its consolidated balance sheet at June 30, 2026. Although SCE has not admitted that its equipment caused the Eaton fire, significant evidence indicates that SCE's equipment was the cause of the Eaton fire. In September 2025, SCE disclosed that it is probable that SCE will incur material losses from the Eaton fire and entered into a negotiated agreement without litigation with one insurance company to pay 52% of the losses incurred. In February 2026, Edison International, parent company of SCE, commented that SCE has settled two subrogation claims on the Eaton fire with insurance companies for an average of 55% of the losses incurred.
(2)    In June 2025, the Company sold its subrogation rights on the Palisades fire to a third party for a guaranteed percentage of losses incurred plus a share in the amount recovered above a certain threshold (“Upside Recovery’). The recovery amount from the guaranteed percentage of losses is approximately $50 million, with $34 million received as of June 30, 2026. The remaining balance of approximately $16 million at June 30, 2026 will be settled each quarter based on the amount of claims payments the Company makes subsequent to the previous settlement date. The Company did not record an amount for the potential Upside Recovery.
(3)    The Company’s catastrophe reinsurance program for the treaty year ended June 30, 2025 provides approximately $1,290 million of limits on a per occurrence basis after covered catastrophe losses exceed the Company’s retention of $150 million. The $1,290 million of limits used for the Palisades and Eaton wildfires was reduced by $6.5 million for ineligible parametric coverage. The Company also utilized $10 million from a separate property excess of loss reinsurance treaty making the total reinsurance used for the Palisades and Eaton wildfires approximately $1,294 million.
(4)    The Company is a member of the California FAIR Plan, the state's fire insurer of last resort. To the extent the FAIR Plan has losses exceeding its capital and reinsurance coverage, the FAIR Plan can assess its member companies for the shortfall based on each company’s California market share. The Company's share of the FAIR Plan losses from the Palisades and Eaton wildfires was approximately $97 million, which was recorded as part of the Company's losses and loss adjustment expenses from the Palisades and Eaton wildfires.
(5)    The FAIR Plan assessed the Company $50 million to strengthen the FAIR Plan's capital position following the Palisades and Eaton wildfires in the first quarter of 2025. The California Department of Insurance ("DOI") allows for recoupment of 50% or $25 million of the $50 million assessment via a temporary surcharge to the Company's policyholders. The Company has received approval from the California DOI to recoup the $25 million, which partially offset the Company's share of the FAIR Plan's losses of $97 million. As of June 30, 2026, the Company has recouped approximately $8 million from its policyholders.
(6)    The increases in these losses and loss adjustment expenses during the six months ended June 30, 2026 largely resulted from higher than estimated losses on partial loss claims.

*** Accounting Standards Codification (“ASC”) 944-40-30-2 through 3 and Statement of Statutory Accounting Principles (“SSAP”) No. 55 paragraph 15 require salvage and subrogation recoverables to be deducted from the liability for unpaid
claims; therefore, loss and loss adjustment expense reserves on the Company's consolidated balance sheets is shown net of estimated salvage and subrogation recoverables, and losses and loss adjustment expenses on its consolidated statements of operations is shown net of salvage and subrogation. The Company applies this accounting method for salvage and subrogation in a consistent manner for both GAAP and statutory reporting purposes.
Allowance for Credit Losses on Premium Receivable
The following table presents a summary of changes in allowance for credit losses on premiums receivable:
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
(Amounts in thousands)
Beginning balance$6,100 $6,600 $6,000 $6,400 
     Provision during the period for expected credit losses 335 225 1,126 1,050 
Write-off amounts during the period(969)(822)(1,958)(1,749)
Recoveries during the period of amounts previously written off 334 297 632 599 
Ending balance $5,800 $6,300 $5,800 $6,300 
Reinsurance Recoverable, Allowance for Credit Loss
The following table presents a summary of changes in allowance for credit losses on reinsurance recoverables:
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
(Amounts in thousands)
Beginning balance$2 $1,192 $39 $— 
     Provision during the period for expected credit losses (1)(633)(38)559 
Write-off amounts during the period— — — — 
Recoveries during the period of amounts previously written off — — — — 
Ending balance$1 $559 $1 $559