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ACGL Insurance

Arch Capital Group Ltd.

Arch Capital Group is a Bermuda-based specialty insurer with about $26.9 billion of capital, in the S&P 500. It operates three underwriting segments — insurance, reinsurance, and mortgage insurance — on a worldwide basis, focusing on specialty lines. In 2025 it wrote $16.5 billion of net premiums and earned net income available to common shareholders of $4.4 billion; book value per share rose from $53.11 to $65.11. Like other insurers, it earns money two ways: underwriting (premiums exceeding claims and expenses, $2.9 billion of underwriting income in 2025) and investing the premiums it holds ($47.4 billion of investable assets, $1.6 billion of net investment income).

Latest 10-K (primary source) ↗Website ↗Investor relations ↗

Last updated

Analysis last edited: October 2, 2026 · Financial data fetched: October 2, 2026 12:50 (SEC EDGAR) · Source 10-K filed: February 26, 2026

Next update expectedAfter FY2026’s 10-K is filed (roughly 60–90 days after fiscal year end (sooner for larger filers)), financials and analysis will be refreshed.

01

Company profile

Legal name
ARCH CAPITAL GROUP LTD.
Headquarters
PEMBROKE, Bermuda
Fiscal year end
12/31
Exchange & ticker
NASDAQ: ACGL
Industry
Insurance
CIK
947484
Website
https://www.archgroup.com/ ↗
IR page
https://ir.archgroup.com/ ↗

Workforce (as of FY2025 year-end)

  • Employees

    8,000

Source: Form 10-K (FY2025) cover page and business description

02

Earnings calendar

When the company reports each quarter: the quarter-end date, the day results were released, and when the 10-Q or 10-K was filed.

Next report

Q3 FY2026

Quarter end: September 2026. In past years, Q3 results were released 27–30 days after quarter end (Oct 27, 2025; Oct 30, 2024; Oct 30, 2023). No date has been announced in the sources this site uses.

Reporting pattern

  • Fiscal year ends around December 31.
  • Reports four times a year: three quarterly reports (10-Q) and an annual report (10-K) for Q4.
  • Earnings releases came 27–45 days after quarter end over the last 12 quarters.
QuarterQuarter endedEarnings release (8-K)Report filed (10-Q / 10-K)
Q2 FY2026Jun 30, 2026Jul 28, 2026 (+28 days)Aug 4, 2026 10-Q (+35 days)
Q1 FY2026Mar 31, 2026Apr 28, 2026 (+28 days)May 5, 2026 10-Q (+35 days)
Q4 FY2025Dec 31, 2025Feb 9, 2026 (+40 days)Feb 26, 2026 10-K (+57 days)
Q3 FY2025Sep 30, 2025Oct 27, 2025 (+27 days)Nov 6, 2025 10-Q (+37 days)
Q2 FY2025Jun 30, 2025Jul 29, 2025 (+29 days)Aug 5, 2025 10-Q (+36 days)
Q1 FY2025Mar 31, 2025Apr 29, 2025 (+29 days)May 7, 2025 10-Q (+37 days)
Q4 FY2024Dec 31, 2024Feb 10, 2025 (+41 days)Feb 27, 2025 10-K (+58 days)
Q3 FY2024Sep 30, 2024Oct 30, 2024 (+30 days)Nov 7, 2024 10-Q (+38 days)
Q2 FY2024Jun 30, 2024Jul 30, 2024 (+30 days)Aug 6, 2024 10-Q (+37 days)
Q1 FY2024Mar 31, 2024Apr 29, 2024 (+29 days)May 9, 2024 10-Q (+39 days)
Q4 FY2023Dec 31, 2023Feb 14, 2024 (+45 days)Feb 23, 2024 10-K (+54 days)
Q3 FY2023Sep 30, 2023Oct 30, 2023 (+30 days)Nov 9, 2023 10-Q (+40 days)

Source: SEC EDGAR filing history. Release dates are the dates the earnings release was furnished to the SEC on Form 8-K (Item 2.02), which is normally the day results are announced. Fiscal years are labeled by the calendar year in which they end.

03

Flagship products & services

  • Insurance

    Specialty and middle-market P&C insurance

    Examples: U.S. MidCorp and Entertainment businesses acquired from Allianz; Lloyd's syndicate

    $7.8B of 2025 net premiums written.

  • Reinsurance

    Property, casualty, and specialty reinsurance

    Examples: Specialty, property, casualty, property catastrophe, marine and aviation

    $8.1B of 2025 net premiums earned, the largest piece specialty ($2.9B).

  • Mortgage

    Mortgage insurance and credit risk transfer

    Examples: U.S. primary mortgage insurance, GSE CRT, international mortgage insurance

    $1.2B of 2025 net premiums earned at very high underwriting margins.

Business lines are from the FY2025 Form 10-K's Item 1 and Note 4.

04

Recent strategic focus

2024–2025 capital and growth moves, from the 10-K.

  1. From special dividend to buybacks

    Arch paid a $1.9B special dividend ($5.00 per share) in 2024 and in 2025 returned $1.9B through share repurchases instead; $1.1B of repurchase authorization remained at year-end. (This site corrected the FY2025 dividend figure, which the company's XBRL data tags as $5.00 but its financial statements show as zero.)

    Source: Form 10-K (FY2025) MD&A and statement of changes in shareholders' equity

  2. Expanding in U.S. middle-market insurance

    The August 2024 MCE Acquisition from Allianz for $450M drove most of the insurance segment's 13.4% growth in 2025 net premiums written.

    Source: Form 10-K (FY2025) Item 1 and MD&A

Where the money goes, over time

Unit: $M. Capex went from $41M in FY2021 to $44M in FY2025

  • Capex
  • M&A spend

formulacapital expenditures ÷ depreciation & amortization

termsCapital expenditures (capex) · Depreciation & amortization (D&A)

Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-02-26

05

Key figures at a glance

FY2021–FY2025, 5 years.

Total revenue (FY2025)

$19.93B

As reported in the 10-K

Revenue CAGR (4 years)

+21.2%▲favorable

formula(last-period revenue ÷ first-period revenue) ^ (1 ÷ years) − 1

e.g.($19,929M ÷ $9,248M) ^ (1÷4) − 1 = 21.2%

termsCAGR · ^ (exponent) · Revenue (net sales)

ROE (FY2025)

19.5%▲favorable

5-year average: 19.4%

As reported in the 10-K

P/B (FY2025 end)

1.42x

formulaP/E × EPS ÷ BVPS (= period-end share price ÷ book value per share)

e.g.8.3x × $11.60 ÷ $67.43 = 1.42x

termsP/B · P/E · EPS · BVPS

Period-end (fiscal year-end) value, not today's P/B

  • ▲

    Revenue grew +21.2% a year over 4 years (strong growth)

    From $9.25B in FY2021 to $19.93B in FY2025. The annualized rate (CAGR) makes it possible to compare growth pace across companies of different sizes.

  • ▲

    Free cash flow was positive in 5 of 5 years

    Operating cash flow minus capital expenditures: the cash left over after funding the business’s own investment, available for dividends, buybacks, acquisitions, or debt paydown. A negative year can mean heavy investment, or weak core earnings — worth distinguishing.

  • ▲

    ROE averaged 19.4% over 5 years (latest: 19.5%)

    How much profit was generated on shareholders’ equity. Roughly 10%+ is often cited as solid for a U.S. company, though this varies a lot by industry and capital intensity.

06

Business model

Insurance

Writes specialty property, casualty, and other insurance in Bermuda, the U.S., the U.K., Europe, Canada, and Australia, much of it through brokers. Expanded in the U.S. middle market in August 2024 by acquiring Allianz's U.S. MidCorp and Entertainment insurance businesses.

Insurance: how money and goods flow

  1. 01 what it draws on

    Inputs & resources

    • Insurance subsidiaries licensed in all 50 U.S. states and abroad, plus a Lloyd's syndicate
    • Capital to back the policies it writes
    • Brokers that bring in business

  2. 02 what it does

    Activities

    • Underwriting: selecting and pricing risks
    • Claims handling and loss reserving
    • Buying reinsurance to limit losses

  3. 03 who it serves

    Customers

    • Businesses buying specialty and middle-market property and casualty cover, mostly through brokers

  4. 04 how money comes in

    How it earns

    • Premiums, usually earned over 12-month policy terms
    • Investment income on premiums held before claims are paid

Insurance: how it makes money

  • Net premiums written were $7.8B in 2025, up 13.4%, mainly because of the MCE Acquisition.
  • Underwriting income was $375M at a 95.2% combined ratio — the thinnest margin of the three segments.
  • North America was $5.7B of the segment's net premiums written.

Reinsurance

Insures other insurers: property catastrophe, other property, casualty, specialty, and marine and aviation reinsurance, written mainly from Bermuda, the U.S., and Europe.

Reinsurance: how money and goods flow

  1. 01 what it draws on

    Inputs & resources

    • Arch Re Bermuda, Arch Re U.S., and Arch Re Europe
    • Catastrophe risk modeling
    • Collateral (letters of credit, trusts) posted for ceding companies

  2. 02 what it does

    Activities

    • Underwriting treaty and facultative reinsurance
    • Managing catastrophe exposure

  3. 03 who it serves

    Customers

    • Primary insurers (ceding companies), mostly through brokers

  4. 04 how money comes in

    How it earns

    • Reinsurance premiums, earned over the terms of the underlying policies or contracts

Reinsurance: how it makes money

  • Net premiums written were $7.6B in 2025, down 1.7%, reflecting non-renewals and lower shares in some specialty lines.
  • Underwriting income was $1.56B at an 80.8% combined ratio.
  • The 2025 loss ratio included 8.5 points of catastrophe losses, mainly the California wildfires, versus 11.8 points in 2024 (Hurricanes Milton and Helene and other events).

Mortgage

Provides U.S. and international mortgage insurance and reinsurance, and takes part in GSE credit risk-sharing transactions. Built largely through the 2016 acquisition of United Guaranty from AIG.

Mortgage: how money and goods flow

  1. 01 what it draws on

    Inputs & resources

    • Mortgage insurers approved as eligible by Fannie Mae and Freddie Mac
    • Capital

  2. 02 what it does

    Activities

    • Insuring lenders against borrower default on low-down-payment mortgages
    • Credit risk transfer (CRT) transactions with the GSEs

  3. 03 who it serves

    Customers

    • Mortgage lenders in the U.S. and internationally
    • Fannie Mae and Freddie Mac (credit risk transfer)

  4. 04 how money comes in

    How it earns

    • Mortgage insurance premiums, including single premiums earned over the estimated expiration of risk

Mortgage: how it makes money

  • Net premiums written were $1.06B in 2025, down 4.7%.
  • Underwriting income was $1.0B at a 14.6% combined ratio. The loss ratio was −0.4%, because favorable development on prior-year reserves ($235M, or 20.2 points) outweighed current-year losses.
  • U.S. primary mortgage insurance was $802M of the segment's $1.17B of net premiums earned.

Revenue by segment (FY2025)

Unit: $M — bar length = revenue, (%) = share of total company revenue, margin = segment profit ÷ segment revenue × 100

  • Insurance

    7,798 (47%)

    profit 375 · margin 4.8%

  • Reinsurance

    7,618 (46%)

    profit 1,558 · margin 20.5%

  • Mortgage

    1,060 (6%)

    profit 1,000 · margin 94.3%

Source: Form 10-K (FY2025) — Note 4, Segment Information Revenue here is net premiums written and profit is underwriting income, both as reported by segment. Net investment income ($1.6B in 2025) and other items are not allocated to segments, so the segment figures don't sum to net income.

07

Where it earns

Many U.S.-listed companies earn most of their revenue outside the U.S. — this breaks down revenue by country/region so it's clear where the business actually makes its money.

Largest market (FY2025)

Insurance — North America — 35% of revenue

Revenue by country / region (FY2025)

Unit: $M — bar length = revenue, (%) = share of total company revenue

  • Insurance — North America

    5,724 (35%)

  • Reinsurance — Bermuda

    3,672 (22%)

  • Reinsurance — Europe and other

    2,148 (13%)

  • Insurance — International

    2,074 (13%)

  • Reinsurance — United States

    1,798 (11%)

  • Mortgage — United States

    780 (5%)

  • Mortgage — Other

    280 (2%)

Source: Form 10-K (FY2025) — Note 4, net premiums written by underwriting location Figures are net premiums written by the location of the underwriting operation, not of the customer; Arch doesn't report revenue by customer country. They sum to the $16,476M total.

08

Contract structure

Short-term or spot sales carry different earnings quality than long-term or auto-renewing contracts — this shows how the company actually contracts with its customers.

Insurance premiums are recorded at policy inception and earned pro rata over the policy term, usually 12 months; reinsurance premiums are earned over the terms of the underlying policies or reinsurance contracts. Each year's business must be renewed, and the 10-K describes the industry as highly cyclical, with periods of excess capacity and unfavorable premium rates. Mortgage insurance includes single premiums earned over the estimated expiration of risk of the policy.

  • Annual contract

    Insurance policies

    47% of 2025 net premiums written ($7.8B)

    Typical term: Usually 12-month policies, earned pro rata

    Pricing resets at each renewal.

  • Annual contract

    Reinsurance contracts

    46% of 2025 net premiums written ($7.6B)

    Typical term: Earned over the terms of the underlying policies or contracts

    Net premiums written fell 1.7% in 2025 on non-renewals and lower shares in some lines.

  • Multi-year / recurring

    Mortgage insurance

    6% of 2025 net premiums written ($1.1B)

    Typical term: Including single premiums earned over the estimated expiration of risk

    Coverage is tied to the underlying mortgages.

Source: Form 10-K (FY2025) — significant accounting policies (premium revenue)

09

Alliances & capital ties

Equity stakes, joint ventures, and strategic partnerships disclosed across the 10-K, 8-Ks, and proxy statement.

  • Capital tie / equity stake

    Somers (via Greysbridge Holdings)

    30% of Greysbridge

    Arch owns 30% of Greysbridge Holdings, which owns Somers Re, a multi-line Bermuda (re)insurer.

    Source: Form 10-K (FY2025) — Item 1

  • Capital tie / equity stake

    Coface SA

    29.5% (acquired 2021)

    Arch bought 29.5% of the common equity of Coface, a France-based trade credit insurer, from Natixis in 2021.

    Source: Form 10-K (FY2025) — Item 1

  • Capital tie / equity stake

    Premia Holdings

    About 25% (with co-investors, 2017)

    In 2017 Arch and co-investors acquired about 25% of Premia Holdings, parent of a multi-line Bermuda reinsurer.

    Source: Form 10-K (FY2025) — Item 1

10

Customers & suppliers

Who the company sells to and buys from. Companies rarely name either, so named counterparties come only from the company's own filings and press releases; otherwise this lists the concentration figures the 10-K discloses.

Customers

Arch sells mostly through brokers to businesses buying specialty insurance, to primary insurers buying reinsurance, and to mortgage lenders and the GSEs in mortgage insurance.

Named by the company

What the filings disclose

  • No other broker and no single insured or reinsured accounted for more than 10% of gross premiums written in 2023–2025. (Form 10-K (FY2025), concentrations of credit risk)
  • The named firms are brokers that place business with Arch, not the policyholders themselves. (Form 10-K (FY2025), concentrations of credit risk)

Suppliers

An insurer's main outside providers are the reinsurers it cedes risk to — $6.4B of premiums were ceded in 2025 — and financial institutions providing letters of credit. The 10-K doesn't name the reinsurers.

Named by the company

None named in the 10-K or the company’s press releases.

What the filings disclose

  • Premiums ceded totaled $6.4B of $22.9B gross premiums written in 2025. (Form 10-K (FY2025), Note 4)
  • A group credit facility provides a $425M secured letter-of-credit facility and a $500M unsecured facility, expiring August 23, 2028. (Form 10-K (FY2025), Note 19)

11

Competitors & peers

Competitors the 10-K names, and the peer group the company itself chose in its proxy statement. Nothing here is this site's own pick.

Arch's 10-K names the insurers and reinsurers it competes with in each business. It says it competes mainly on financial strength, ratings, geographic scope, client relationships, premiums, contract terms, products, claims-payment speed, reputation, and local presence.

Competitors named in the 10-K

Property casualty insurance and reinsurance

U.S. mortgage insurance

Plus government programs, mainly the FHA and, to a lesser degree, the VA.

Australian mortgage insurance

Plus the Australian Government's Home Guarantee Scheme.

Source: Form 10-K (FY2025) — Item 1, Competition

Peer group the company chose

2025 Compensation Peer Group, from the proxy statement. Peers are companies the board considers comparable — for example when setting executive pay — not necessarily direct competitors.

Publicly traded insurers and reinsurers that the compensation committee believes compete directly with Arch for executive talent, of similar size and product range.

A separate 20-company Performance Peer Group is used to measure relative shareholder return.

Source: Proxy statement (DEF 14A, filed 2026-03-24) — Compensation Discussion and Analysis, peer group

Company names link to this site’s analysis where one exists; “site ↗” opens the company’s own website.

12

M&A history

Companies acquired over the last five years, plus older large acquisitions that still anchor a current business — what each was bought to do, and what happened afterward. From the 10-K, 8-Ks, and the company's press releases.

Arch has expanded through acquisitions in each segment: United Guaranty (mortgage, 2016), Barbican (U.K. and Lloyd's, 2019), Somerset Group (motor insurance distribution, 2021), and Allianz's U.S. MidCorp and Entertainment businesses (2024). It also holds minority stakes in Somers, Premia, and Coface (see Alliances).

Cash spent on acquisitions, FY2022–FY2025: −$852M (years not reported separately are excluded)

  1. Aug 2024 (FY2024)

    Allianz U.S. MidCorp and Entertainment insurance businesses (MCE Acquisition)

    $450M cash

    U.S. middle-market property and casualty insurance and entertainment insurance, written by Fireman's Fund (an Allianz affiliate).

    Stated purpose (company)
    "An important part of the Company's growth strategy" that "provides a ballast to our existing insurance business," enhances U.S. middle-market capabilities, and is "an attractive way to enter the entertainment insurance market."

    Since then: Drove most of the insurance segment's 13.4% growth in 2025 net premiums written. Arch's 2024 cash flows included $852M of net cash received related to the acquisition.

    Source: Form 10-K (FY2025) — Item 1 and MCE Acquisition note

  2. 2021 (FY2021)

    Somerset Group

    Not disclosed in the FY2025 10-K

    A U.K. motor insurance managing general agent with direct and aggregator distribution, an affiliated insurer, and a claims operation.

    Stated purpose (company)
    Acquired by Arch Re Bermuda; described as part of the reinsurance operations.

    Since then: Part of the reinsurance segment.

    Source: Form 10-K (FY2025) — Item 1

  3. 2019 (FY2019)

    Barbican Group

    Not disclosed in the FY2025 10-K

    A U.K. insurance group including a Lloyd's managing agency.

    Stated purpose (company)
    "Significantly expanded our U.K. presence" and contributed to reinsurance operations in the London market.

    Since then: Part of the insurance and reinsurance segments.

    Source: Form 10-K (FY2025) — Item 1

  4. Dec 2016 (FY2016)

    United Guaranty Corporation (from AIG)

    $3.26B ($2.16B cash + $1.1B of convertible preferred shares)

    Older deal, core to today's business

    A leading U.S. mortgage insurer approved by Fannie Mae and Freddie Mac.

    Stated purpose (company)
    The FY2025 10-K says the U.S. mortgage platform, established in 2014, "expanded greatly in 2016 through the acquisition" of UGC.

    Since then: The mortgage segment produced $1.0B of underwriting income in 2025.

    Source: Form 10-K (FY2016) — acquisition of UGC · Form 10-K (FY2025) — Item 1

Deal dates are closing dates; Arch's fiscal year is the calendar year.

13

Five years of financials

Each chart's axis holds a single unit (never mixing dollars, %, and $/share). The table's per-period header links to the filing the numbers came from.

Total revenue over time

Unit: $M

Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-02-26

Profit over time (operating → net)

Unit: $M

  • Pretax income
  • Net income

Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-02-26

Cash flow over time

Unit: $M (below zero = cash went out)

  • Operating CF
  • Investing CF
  • Free CF

formulacash flow from operations − capital expenditures

termsFree cash flow (FCF) · Cash flow from operations (operating CF) · Capital expenditures (capex)

Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-02-26

Financial stability & capital efficiency

Unit: %

  • Equity ratio
  • ROE

formulatotal equity ÷ total assets × 100 (as reported in the 10-K)

termsStockholders’ equity · Total assets

formulanet income ÷ average equity (beginning + ending, ÷2) × 100 (as reported in the 10-K)

termsNet income (attributable to the company) · Stockholders’ equity

Earnings per share (EPS) and dividend per share

Unit: $

  • EPS
  • Dividend per share

Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-02-26

Line itemFY202110-K on EDGAR ↗FY202210-K on EDGAR ↗FY202310-K on EDGAR ↗FY202410-K on EDGAR ↗FY202510-K on EDGAR ↗
Income statement ($M)
Revenue9,2489,61313,63417,44019,929
Pretax income2,3681,5623,5704,6745,159
Net income (attributable)2,1571,4764,4434,3124,399
Revenue growthcalc(this year’s revenue − last year’s revenue) ÷ last year’s revenue × 100—3.9%41.8%27.9%14.3%
Net margincalcnet income attributable to the company ÷ revenue × 10023.3%15.4%32.6%24.7%22.1%
Balance sheet ($M)
Total assets45,10147,99058,90670,90679,241
Total equity13,54612,91018,35320,82024,206
Equity ratio30.0%26.9%31.2%29.4%30.5%
ROE15.9%11.2%28.4%22.0%19.5%
Cash flow ($M)
Operating CF3,4253,8165,7496,6736,172
Investing CF-2,138-3,101-5,468-4,461-4,036
Financing CF-1,229-706-69-1,925-1,890
Free cash flowcalccash flow from operations − capital expenditures3,3843,7665,6976,6226,128
Cash and equivalents859855917979993
Per share & other
EPS ($)5.233.8011.6211.1911.60
BVPS ($)35.7534.8549.1555.3167.43
Dividend per share ($)———5.00—
Payout ratiocalcdividend per share ÷ diluted EPS × 100———44.7%—
P/E (x)8.516.56.48.38.3
P/B (x)calcP/E × EPS ÷ BVPS (= period-end share price ÷ book value per share)1.241.801.511.671.42

P/B and EV/EBITDA use each period’s period-end (fiscal year-end) figures, not the current share price. Figures without a "calc" tag are as reported in the Form 10-K (five-year selected financial data and the consolidated financial statements), pulled automatically from SEC EDGAR. Where a later filing restated a prior period, the restated figure is used.

14

Is ROIC above WACC?

ROIC (the return on money invested in the business) above WACC (the cost of raising that money) means the company is creating value. WACC is an estimate, so its assumptions can be adjusted below.

Banks, insurers, and similar financial companies aren’t compared this way, since deposits/policies are the business itself and debt can’t be cleanly separated from operating capital.

15

What the price implies (DCF)

A company's value can be written as its free cash flow divided by (cost of capital − perpetual growth). Working that backwards from the market's valuation shows how much growth the share price assumed — compared here with the company's actual past growth.

Not applied to banks, insurers, and similar financial companies: their operating cash flow includes deposits or premiums held for customers, so it isn’t free cash flow available to investors.

16

Earnings quality

The same reported profit can mean different things depending on whether it's backed by cash, driven by the core business, or the result of a one-off item. Four checks below.

Financial companies’ operating cash flow behaves differently from an operating company’s, so this analysis doesn’t apply.

17

Strengths & weaknesses

Strengths

  1. 1. Profitable underwriting across all three segments

    All three segments made an underwriting profit in 2023, 2024, and 2025; the combined ratio for the group was 82.8% in 2025 (82.5% in 2024).

    Evidence: Form 10-K (FY2025) Note 4

  2. 2. A very profitable mortgage business

    Mortgage insurance produced $1.0B of underwriting income on $1.17B of net premiums earned in 2025, a 14.6% combined ratio.

    Evidence: Form 10-K (FY2025) Note 4

  3. 3. Fast-growing book value

    Book value per share rose from $53.11 to $65.11 during 2025 while Arch repurchased $1.9B of shares.

    Evidence: Form 10-K (FY2025) Item 1 and MD&A

Weaknesses

  1. 1. Thin margins in the largest segment

    The insurance segment, the largest by net premiums written, had a 95.2% combined ratio in 2025 — $375M of underwriting income on $7.8B of premiums — versus 80.8% in reinsurance.

    Evidence: Form 10-K (FY2025) Note 4

  2. 2. Earnings exposed to catastrophes

    Catastrophe losses added 8.5 points to the reinsurance loss ratio in 2025 (California wildfires) and 11.8 points in 2024 (Hurricanes Milton and Helene and other events).

    Evidence: Form 10-K (FY2025) MD&A

  3. 3. Dependence on two brokers

    Marsh & McLennan accounted for 16.6% and Aon for 14.6% of gross premiums written in 2025.

    Evidence: Form 10-K (FY2025) concentrations of credit risk

18

What draws investors to it

Why the stock can look attractive to investors — each point paired with what has to hold for it to stay true, and the opposing view. This is this site's analysis, not a recommendation to buy or sell.

P/E (FY2025)

8.3x

Price at fiscal year-end ÷ diluted EPS

Dividend yield (FY2025)

—

Dividends per share ÷ fiscal year-end price

Payout ratio (FY2025)

—

Dividends per share ÷ diluted EPS

  1. 1. Low valuation relative to earnings

    At the FY2025 year-end price the stock traded at about 8.3 times earnings, on net income of $4.4B.

    What has to hold
    Underwriting and investment income stay near recent levels.
    The other side
    Insurer earnings swing with catastrophes and reserve development: in 2025 favorable prior-year development lowered the reinsurance loss ratio by 4.0 points and contributed $235M to mortgage results.

    Evidence: SEC EDGAR XBRL; Form 10-K (FY2025) MD&A

  2. 2. Book value compounding

    Book value per share rose 23% in 2025 (from $53.11 to $65.11), after a $1.9B special dividend the year before.

    What has to hold
    Arch keeps writing profitable business and its investment portfolio holds value.
    The other side
    The 10-K warns that financial market disruption and weak economic conditions could materially affect its investments, which back its insurance liabilities.

    Evidence: Form 10-K (FY2025) Item 1 and Item 1A

  3. 3. Diversified, specialty-focused earnings

    Underwriting income comes from three different businesses — insurance, reinsurance, and mortgage — plus $1.6B of net investment income.

    What has to hold
    Losses in one line (e.g. catastrophes in reinsurance) don't coincide with losses in the others.
    The other side
    A severe U.S. downturn could hurt mortgage insurance and investments at the same time; the 10-K notes the ultimate performance of the mortgage portfolios remains uncertain.

    Evidence: Form 10-K (FY2025) Note 4 and Item 1A

P/E and dividend yield above use the fiscal year-end share price. Arch paid no common dividend in 2025; FCF yield is not shown for insurers because operating cash flow includes premiums held to pay future claims.

19

Resilience

How well the company could absorb a bad year: its financial buffer, how its revenue and profit held up in the worst year on record, and what the 10-K says about the business's exposure to shocks. Figures and filing statements only — no overall rating.

1. Financial buffer (FY2025)

For an insurer or bank, debt-coverage ratios like these don’t describe its ability to absorb losses — that depends on its capital, reserves, and investment portfolio, which are covered in part 3 below.

2. Worst year in the record, and the recovery

FigureWorst year-over-year changeBack to the prior level?
RevenueNo decline in the record—
Net income-31.6% in FY2022 ($2.16B → $1.48B)Yes, by FY2023

Covers only the 5 fiscal years on record (FY2021–FY2025), which may not include a full recession — the worst year here isn’t necessarily how the company would fare in a severe downturn.

3. Business resilience (from the 10-K)

  • Capital

    Arch had about $26.9B of capital at FY2025 year-end and senior notes carried at $2.7B.

    Source: Form 10-K (FY2025), Item 1 and fair value note

  • Investment portfolio

    Investable assets were $47.4B, managed to meet insurance liabilities, manage interest-rate risk, and keep enough liquidity for fluctuations in claims payments, including debt service.

    Source: Form 10-K (FY2025), MD&A Investments

  • Undrawn credit lines

    The $500M unsecured facility had no borrowings or letters of credit outstanding; the $425M secured letter-of-credit facility had $201M of remaining capacity.

    Source: Form 10-K (FY2025), Note 19

  • Catastrophe years absorbed

    Even with 8.5 points (2025) and 11.8 points (2024) of catastrophe losses in reinsurance, the reinsurance segment stayed profitable, with combined ratios of 80.8% and 83.2%.

    Source: Form 10-K (FY2025), MD&A and Note 4

  • Three different risk pools

    Insurance, reinsurance, and mortgage results respond to different events; in 2025 mortgage underwriting income ($1.0B) was nearly three times insurance's ($375M).

    Source: Form 10-K (FY2025), Note 4 · See Business model

  • Broker concentration

    Two brokers placed about 31% of gross premiums written in 2025; no other broker exceeded 10%.

    Source: Form 10-K (FY2025), concentrations of credit risk · See Customers & suppliers

20

Risks (including geopolitical)

Starting from the 10-K's Risk Factors section, organized by category — geopolitical, currency, raw materials, regulatory, disaster, and more — with impact and likelihood assessed by this site.

Risk map

Vertical = impact on results, horizontal = likelihood. Upper right = most severe. Numbers match the list below (placement is this site’s own assessment).

Impact
High
3
1
Med
6
245
Low
LowMedHigh

Likelihood →

"Company disclosure" vs. "this site’s assessment"

The description and mitigation for each risk are this site’s summary of the 10-K’s "Risk Factors" section. Impact and likelihood are this site’s own assessment, not the company’s — where the company discloses its own likelihood assessment, that is noted in the summary.

Impact is judged from how large the affected business is relative to total revenue/profit, and from the risk’s track record of moving results in the past. Likelihood is judged from the filing’s wording and the current business environment (already occurring, or recurring).

  1. 1Disaster

    Natural catastrophes and climate change

    Company disclosure (summarized from the 10-K)
    The 10-K says claims for natural catastrophic events could cause large losses and substantial volatility, and that climate change will affect its loss limitation methods, such as buying reinsurance and catastrophe modeling.
    Company’s stated mitigation
    Buying third-party reinsurance and catastrophe risk modeling, which the 10-K notes could themselves fail.
    This site’s assessment
    Impact High / Likelihood High
  2. 2Demand & macro

    The insurance cycle

    Company disclosure (summarized from the 10-K)
    The 10-K describes the industry as highly cyclical, with periods of excess underwriting capacity and unfavorable premium rates; reinsurance net premiums written already fell 1.7% in 2025.
    Company’s stated mitigation
    Not stated in the 10-K.
    This site’s assessment
    Impact Med / Likelihood Med
  3. 3Governance & quality

    Reserving uncertainty

    Company disclosure (summarized from the 10-K)
    The 10-K says underwriting and loss reserving rely on probabilities and modeling subject to inherent uncertainty. In 2025 favorable prior-period reserve development lowered the reinsurance loss ratio by 4.0 points; that could reverse if reserves prove inadequate.
    Company’s stated mitigation
    Not stated in the 10-K.
    This site’s assessment
    Impact High / Likelihood Low
  4. 4Law & regulation

    U.S. housing policy and the GSEs

    Company disclosure (summarized from the 10-K)
    The 10-K says changes to the GSEs' role, their eligibility requirements for mortgage insurers, or a decline in low-down-payment originations could reduce mortgage insurance written.
    Company’s stated mitigation
    Not stated in the 10-K.
    This site’s assessment
    Impact Med / Likelihood Med
  5. 5Demand & macro

    Inflation, tariffs, and economic conditions

    Company disclosure (summarized from the 10-K)
    The 10-K says inflation, trade and tariff disputes, and other economic conditions affect the insurance and reinsurance industry in ways that may negatively affect its business, financial condition, and results.
    Company’s stated mitigation
    Not stated in the 10-K.
    This site’s assessment
    Impact Med / Likelihood Med
  6. 6Supply chain

    Counterparties: brokers and reinsurers

    Company disclosure (summarized from the 10-K)
    Arch underwrites much of its business through brokers and is exposed to credit risk if they fail to pay balances owed; it also depends on third parties managing their risks properly.
    Company’s stated mitigation
    Counterparty credit evaluation and, where appropriate, collateral such as letters of credit and trusts.
    This site’s assessment
    Impact Med / Likelihood Low

21

What to watch going forward

  • Catastrophe losses in each year's reinsurance results.
  • Whether the insurance segment's margins improve as the acquired MidCorp and Entertainment business matures.
  • Pricing conditions in reinsurance, where premiums declined in 2025.
  • Mortgage insurance volumes and any changes to the role of Fannie Mae and Freddie Mac.
  • Book value per share growth and capital returns (buybacks or special dividends).

22

Source documents

This page's financial figures come from the Form 10-Ks listed below. Check the original filings for full detail.

Form 10-K (FY2025)Accession no. 0000947484-26-000017 — filed 2026-02-26Open on EDGAR ↗Form 10-K (FY2024)Accession no. 0000947484-25-000017 — filed 2025-02-27Open on EDGAR ↗Form 10-K (FY2023)Accession no. 0000947484-24-000020 — filed 2024-02-23Open on EDGAR ↗Form 10-K (FY2022)Accession no. 0000947484-23-000015 — filed 2023-02-24Open on EDGAR ↗Form 10-K (FY2021)Accession no. 0000947484-22-000015 — filed 2022-02-25Open on EDGAR ↗Arch Capital Group Ltd. investor relations pageEarnings releases, investor presentations, etc. (official company source)Open website ↗

Last updated

Analysis last edited: October 2, 2026 · Financial data fetched: October 2, 2026 12:50 (SEC EDGAR) · Source 10-K filed: February 26, 2026

Next update expectedAfter FY2026’s 10-K is filed (roughly 60–90 days after fiscal year end (sooner for larger filers)), financials and analysis will be refreshed.

This page is this site’s own analysis based on public information, and does not represent Arch Capital Group Ltd.’s views. It is not a recommendation to buy or sell any security, and this site does not guarantee the accuracy of any figure or statement here. Always verify against the original source documents before making an investment decision.