0001669162false00016691622024-10-242024-10-24

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of report (Date of earliest event reported): October 24, 2024
KINSALE CAPITAL GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware
001-3784898-0664337
(State or other jurisdiction
of incorporation)
(Commission File Number)
(IRS Employer Identification No.)
2035 Maywill Street
Suite 100
Richmond, Virginia 23230
(Address of principal executive offices, including zip code)
(804) 289-1300
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)Name of each exchange on which registered
Common Stock, par value $0.01 per shareKNSLNew York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


Item 2.02     Results of Operations and Financial Condition.
On October 24, 2024, Kinsale Capital Group, Inc. (the “Company”) issued a press release announcing its financial results for the three and nine months ended September 30, 2024. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

Item 9.01    Financial Statements and Exhibits.
    (d) Exhibits.
Exhibit No.Description
99.1
104Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Kinsale Capital Group, Inc.
Dated: October 24, 2024
By:/s/ Bryan P. Petrucelli
Bryan P. Petrucelli
Executive Vice President, Chief Financial Officer and Treasurer


Exhibit 99.1
kinsalecapitalgrouplogo.jpg
Kinsale Capital Group Reports Third Quarter 2024 Results
Richmond, VA, October 24, 2024 - Kinsale Capital Group, Inc. (NYSE: KNSL) reported net income of $114.2 million, $4.90 per diluted share, for the third quarter of 2024 compared to $76.1 million, $3.26 per diluted share, for the third quarter of 2023. Net income included after-tax catastrophe losses of $10.8 million in the third quarter of 2024 and $0.9 million in the third quarter of 2023. Net income was $305.7 million, $13.10 per diluted share, for the first nine months of 2024 compared to $204.7 million, $8.79 per diluted share, for the first nine months of 2023. Net income included after-tax catastrophe losses of $13.9 million in the first nine months of 2024 and $3.3 million in the first nine months of 2023.
Net operating earnings(1) were $97.9 million, $4.20 per diluted share, for the third quarter of 2024 compared to $77.2 million, $3.31 per diluted share, for the third quarter of 2023. Net operating earnings(1) were $267.0 million, $11.44 per diluted share, for the first nine months of 2024 compared to $201.1 million, $8.63 per diluted share, for the first nine months of 2023.
Highlights for the quarter included:
•Diluted earnings per share increased by 50.3% to $4.90 compared to the third quarter of 2023
•Diluted operating earnings(1) per share increased by 26.9% to $4.20 compared to the third quarter of 2023
•Gross written premiums increased by 18.8% to $448.6 million compared to the third quarter of 2023
•Net investment income increased by 46.4% to $39.6 million compared to the third quarter of 2023
•Underwriting income(2) was $86.9 million in the third quarter of 2024, resulting in a combined ratio(5) of 75.7%
•Annualized operating return on equity(7) was 28.2% for the nine months ended September 30, 2024

“Our third quarter results reflect the continued execution of our strategy of disciplined underwriting and technology-enabled low costs. Our reported 75.7% combined ratio includes a modest 3.8 points of net catastrophe losses. Looking ahead, we remain confident in our ability to drive profitable growth and deliver long-term value for stockholders,” said Chairman and Chief Executive Officer, Michael P. Kehoe.
Results of Operations
Underwriting Results
Gross written premiums were $448.6 million for the third quarter of 2024 compared to $377.8 million for the third quarter of 2023, an increase of 18.8%. Gross written premiums were $1.4 billion for the first nine months of 2024 compared to $1.2 billion for the first nine months of 2023, an increase of 21.6%. The increase in gross written premiums during the third quarter and first nine months of 2024 over the same periods last year reflected strong submission flow from brokers and a favorable, yet increasingly competitive, pricing environment.






1

Underwriting income(2) was $86.9 million, resulting in a combined ratio(5) of 75.7% for the third quarter of 2024, compared to $72.4 million and a combined ratio(5) of 74.8% for the same period last year. The increase in underwriting income(2) quarter over quarter was largely due to combination of premium growth and lower relative net commissions offset in part by higher catastrophe losses. Loss(3) and expense(4) ratios were 56.1% and 19.6%, respectively, for the third quarter of 2024 compared to 53.9% and 20.9% for the third quarter of 2023. Results for the third quarters of 2024 and 2023 included net favorable development of loss reserves from prior accident years of $10.1 million, or 2.8 points, and $9.1 million, or 3.2 points, respectively. The loss ratio for the third quarter of 2024 included 3.8 points of net catastrophe losses, primarily related to Hurricanes Helene, Francine and Beryl and tornadoes in the Midwest. Net catastrophe losses were negligible for the third quarter of 2023.
Underwriting income(2) was $228.0 million, resulting in a combined ratio(5) of 77.6% for the first nine months of 2024, compared to $185.5 million and a combined ratio(5) of 76.7% for the first nine months of 2023. The increase in underwriting income(2) was primarily due to a combination of premium growth and lower relative net commissions offset in part by higher catastrophe losses. Loss(3) and expense(4) ratios were 57.1% and 20.5%, respectively, for the first nine months of 2024 compared to 55.5% and 21.2% for the first nine months of 2023. Results for the first nine months of 2024 and 2023 included net favorable development of loss reserves from prior accident years of $28.1 million, or 2.7 points, and $28.6 million, or 3.6 points, respectively. The loss ratio for the first nine months of 2024 included 1.7 points of net catastrophe losses, primarily related to Hurricanes Helene, Francine and Beryl and tornadoes in the Midwest. Net catastrophe losses were negligible for the first nine months of 2023.
Summary of Operating Results
The Company’s operating results for the three and nine months ended September 30, 2024 and 2023 are summarized as follows:
Three Months Ended September 30,Nine Months Ended September 30,
2024202320242023
($ in thousands)
Gross written premiums$448,646 $377,789 $1,427,060 $1,173,599 
Ceded written premiums(98,709)(83,509)(295,833)(215,248)
Net written premiums$349,937 $294,280 $1,131,227 $958,351 
Net earned premiums $348,752 $281,502 $990,731 $775,706 
Fee income 8,489 6,841 25,572 20,028 
Losses and loss adjustment expenses200,240 155,552 580,351 441,628 
Underwriting, acquisition and insurance expenses
70,139 60,348 207,960 168,567 
Underwriting income(2)
$86,862 $72,443 $227,992 $185,539 
Loss ratio(3)
56.1 %53.9 %57.1 %55.5 %
Expense ratio(4)
19.6 %20.9 %20.5 %21.2 %
Combined ratio(5)
75.7 %74.8 %77.6 %76.7 %
Annualized return on equity(6)
33.9 %33.9 %32.3 %32.7 %
Annualized operating return on equity(7)
29.1 %34.4 %28.2 %32.1 %
(1)     Net operating earnings is a non-GAAP financial measure. See discussion of "Non-GAAP Financial Measures" below.
(2)    Underwriting income is a non-GAAP financial measure. See discussion of "Non-GAAP Financial Measures" below.






2

(3)    Loss ratio, expressed as a percentage, is the ratio of losses and loss adjustment expenses to the sum of net earned premiums and fee income.
(4)    Expense ratio, expressed as a percentage, is the ratio of underwriting, acquisition and insurance expenses to the sum of net earned premiums and fee income.
(5)    The combined ratio is the sum of the loss ratio and expense ratio as presented. Calculations of each component may not add due to rounding.
(6)    Annualized return on equity is net income expressed on an annualized basis as a percentage of average beginning and ending stockholders’ equity during the period.
(7)    Annualized operating return on equity is net operating earnings expressed on an annualized basis as a percentage of average beginning and ending stockholders’ equity during the period.

The following tables summarize losses incurred for the current accident year and the development of prior accident years for the three and nine months ended September 30, 2024 and 2023:

Three Months Ended
September 30, 2024		Three Months Ended
September 30, 2023
Losses and Loss Adjustment Expenses% of Sum of Earned Premiums and Fee IncomeLosses and Loss Adjustment Expenses% of Sum of Earned Premiums and Fee Income
Loss ratio:($ in thousands)
Current accident year$196,750 55.1 %$163,545 56.7 %
Current accident year - catastrophe losses
13,615 3.8 %1,154 0.4 %
Effect of prior accident year development(10,125)(2.8)%(9,147)(3.2)%
Total$200,240 56.1 %$155,552 53.9 %

Nine Months Ended
September 30, 2024		Nine Months Ended
September 30, 2023
Losses and Loss Adjustment Expenses% of Sum of Earned Premiums and Fee IncomeLosses and Loss Adjustment Expenses% of Sum of Earned Premiums and Fee Income
Loss ratio:($ in thousands)
Current accident year$590,810 58.1 %$466,056 58.6 %
Current accident year - catastrophe losses
17,613 1.7 %4,179 0.5 %
Effect of prior accident year development(28,072)(2.7)%(28,607)(3.6)%
Total$580,351 57.1 %$441,628 55.5 %







3

Investment Results
Net investment income was $39.6 million in the third quarter of 2024 compared to $27.1 million in the third quarter of 2023, an increase of 46.4%. Net investment income was $108.4 million in the first nine months of 2024 compared to $72.0 million in the first nine months of 2023, an increase of 50.7%. These increases were driven by growth in the Company's investment portfolio generated largely from the investment of strong operating cash flows and higher interest rates relative to the prior year period. Net operating cash flows were $763.3 million in the first nine months of 2024 compared to $648.3 million in the first nine months of 2023, an increase of 17.7%. The Company’s investment portfolio had an annualized gross investment return(8) of 4.3% for the first nine months of 2024 compared to 3.9% for the same period last year. Funds are generally invested conservatively in high quality securities with an average credit quality of "AA-" and the weighted average duration of the fixed-maturity investment portfolio, including cash equivalents, was 3.1 years and 2.8 years at September 30, 2024 and December 31, 2023, respectively. Cash and invested assets totaled $4.0 billion at September 30, 2024 and $3.1 billion at December 31, 2023.
(8)    Gross investment return is investment income from fixed-maturity and equity securities (and short-term investments, if any), before any deductions for fees and expenses, expressed as a percentage of average beginning and ending book values of those investments during the period.
Other
The effective tax rates for the nine months ended September 30, 2024 and 2023 were 18.7% and 19.4%, respectively. In the first nine months of 2024 and 2023, the effective tax rates were lower than the federal statutory rate of 21% primarily due to the tax benefits from stock-based compensation, including stock options exercised, and from tax-exempt investment income.
Stockholders' equity was $1.4 billion at September 30, 2024 compared to $1.1 billion at December 31, 2023. Book value per share was $61.62 at September 30, 2024 compared to $46.88 at December 31, 2023. Annualized operating return on equity(7) was 28.2% for the first nine months of 2024, a decrease from 32.1% for the first nine months of 2023. The decrease was due primarily to higher average stockholders' equity as a result of profitable growth and an increase in the fair value of our fixed income portfolio offset in part by higher net operating earnings.
Share Repurchase Authorization
In October 2024, the Company's Board of Directors authorized a share repurchase program authorizing the repurchase of up to $100.0 million of the Company's common stock. The shares may be repurchased from time to time in open market purchases, privately-negotiated transactions, block purchases, accelerated share repurchase agreements or a combination of methods and pursuant to safe harbors provided by Rule 10b-18 and Rule 10b5-1 under the Securities Exchange Act of 1934. The timing, manner, price and amount of any repurchases under the share repurchase program will be determined by the Company in its discretion. The stock repurchase program does not require the Company to repurchase any specific number of shares, and may be modified, suspended or terminated at any time.
Non-GAAP Financial Measures
Net Operating Earnings
Net operating earnings is defined as net income excluding the effects of the change in the fair value of equity securities, after taxes, net realized investment gains and losses, after taxes, and change in allowance for credit losses on investments, after taxes. Management believes the exclusion of these items provides a useful comparison of the Company's underlying business performance from period to period. Net operating earnings and percentages or calculations using net operating earnings (e.g., diluted operating earnings per share and annualized operating return on equity) are non-GAAP financial measures. Net operating earnings should not be viewed as a substitute for net income calculated in accordance with GAAP, and other companies may define net operating earnings differently.






4

For the three and nine months ended September 30, 2024 and 2023, net income and diluted earnings per share reconcile to net operating earnings and diluted operating earnings per share as follows:
Three Months Ended September 30,Nine Months Ended September 30,
2024202320242023
($ in thousands, except per share data)
Net operating earnings:
Net income$114,229 $76,115 $305,749 $204,706 
Adjustments:
Change in the fair value of equity securities, before taxes(20,659)5,533 (41,871)(3,796)
Income tax expense (benefit) (1)
4,338 (1,162)8,793 797 
Change in fair value of equity securities, after taxes(16,321)4,371 (33,078)(2,999)
Net realized investment (gains) losses, before taxes8 (4,274)(6,737)(913)
Income tax expense (benefit) (1)
(2)898 1,415 192 
Net realized investment (gains) losses, after taxes6 (3,376)(5,322)(721)
Change in allowance for credit losses on investments, before taxes(4)143 (490)199 
Income tax expense (benefit) (1)
1 (30)103 (42)
Change in allowance for credit losses on investments, after taxes(3)113 (387)157 
Net operating earnings$97,911 $77,223 $266,962 $201,143 
Diluted operating earnings per share:
Diluted earnings per share$4.90 $3.26 $13.10 $8.79 
Change in the fair value of equity securities, after taxes, per share(0.70)0.19 (1.42)(0.13)
Net realized investment (gains) losses, after taxes, per share— (0.14)(0.23)(0.03)
Change in allowance for credit losses on investments, after taxes, per share— — (0.02)0.01 
Diluted operating earnings per share(2)
$4.20 $3.31 $11.44 $8.63 
Operating return on equity:
Average equity(3)
$1,346,076 $897,789 $1,260,891 $834,606 
Annualized return on equity(4)
33.9 %33.9 %32.3 %32.7 %
Annualized operating return on equity(5)
29.1 %34.4 %28.2 %32.1 %
(1)     Income taxes on adjustments to reconcile net income to net operating earnings use a 21% effective tax rate.
(2)     Diluted operating earnings per share may not add due to rounding.
(3)    Average equity is computed by adding the total stockholders' equity as of the date indicated to the prior quarter-end or year-end total, as applicable, and dividing by two.
(4)    Annualized return on equity is net income expressed on an annualized basis as a percentage of average beginning and ending stockholders’ equity during the period.






5

(5)    Annualized operating return on equity is net operating earnings expressed on an annualized basis as a percentage of average beginning and ending stockholders’ equity during the period.
Underwriting Income
Underwriting income is defined as net income excluding net investment income, the change in the fair value of equity securities, net realized investment gains and losses, change in allowance for credit losses on investments, interest expense, other expenses, other income and income tax expense. The Company uses underwriting income as an internal performance measure in the management of its operations because the Company believes it gives management and users of the Company's financial information useful insight into the Company's results of operations and underlying business performance. Underwriting income should not be viewed as a substitute for net income calculated in accordance with GAAP, and other companies may define underwriting income differently.
For the three and nine months ended September 30, 2024 and 2023, net income reconciles to underwriting income as follows:
Three Months Ended September 30,Nine Months Ended September 30,
2024202320242023
(in thousands)
Net income$114,229 $76,115 $305,749 $204,706 
Income tax expense 30,169 19,378 70,316 49,290 
Income before income taxes144,398 95,493 376,065 253,996 
Net investment income(39,644)(27,086)(108,424)(71,953)
Change in the fair value of equity securities
(20,659)5,533 (41,871)(3,796)
Net realized investment (gains) losses 8 (4,274)(6,737)(913)
Change in allowance for credit losses on investments(4)143 (490)199 
Interest expense2,589 2,573 7,575 7,867 
Other expenses (6)
692 401 3,451 1,220 
Other income(518)(340)(1,577)(1,081)
Underwriting income$86,862 $72,443 $227,992 $185,539 
(6)    Other expenses includes primarily corporate expenses not allocated to the Company's insurance operations.

Conference Call
Kinsale Capital Group will hold a conference call to discuss this press release on Friday, October 25, 2024 at 9:00 a.m. (Eastern Time). Members of the public may access the conference call by dialing (800) 715-9871, conference ID# 7469751, or via the Internet by going to www.kinsalecapitalgroup.com and clicking on the "Investor Relations" link. A replay of the call will be available on the website until the close of business on November 22, 2024.

Forward-Looking Statements
This press release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. In some cases, such forward-looking statements may be identified by terms such as "anticipates," "estimates," "expects," "intends," "plans," "predicts," "projects," "believes," "seeks," "outlook," "future," "will," "would," "should," "could," "may," "can have," "prospects" or similar words. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Although it is not possible to identify all of these risks and factors, they include, among others, the following: inadequate loss reserves to cover the Company's actual losses; inherent uncertainty of models resulting in actual losses that are materially different than the Company's estimates; adverse economic factors; a decline in the Company's financial strength rating; loss of one or more key executives; loss of a group of brokers that generate significant portions of the Company's






6

business; failure of any of the loss limitations or exclusions the Company employs, or change in other claims or coverage issues; adverse performance of the Company's investment portfolio; adverse market conditions that affect its excess and surplus lines insurance operations; and other risks described in the Company's filings with the Securities and Exchange Commission. These forward-looking statements speak only as of the date of this release and the Company does not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

About Kinsale Capital Group, Inc.
Kinsale Capital Group, Inc. is a specialty insurance group headquartered in Richmond, Virginia, focusing on the excess and surplus lines market.
Contact
Kinsale Capital Group, Inc.
Bryan Petrucelli
Executive Vice President, Chief Financial Officer and Treasurer
804-289-1272
ir@kinsalecapitalgroup.com






7

KINSALE CAPITAL GROUP, INC. AND SUBSIDIARIES
Unaudited Consolidated Statements of Income and Comprehensive Income

Three Months Ended September 30,Nine Months Ended September 30,
2024202320242023
Revenues(in thousands, except per share data)
Gross written premiums$448,646 $377,789 $1,427,060 $1,173,599 
Ceded written premiums(98,709)(83,509)(295,833)(215,248)
Net written premiums349,937 294,280 1,131,227 958,351 
Change in unearned premiums(1,185)(12,778)(140,496)(182,645)
Net earned premiums348,752 281,502 990,731 775,706 
Fee income 8,489 6,841 25,572 20,028 
Net investment income39,644 27,086 108,424 71,953 
Change in the fair value of equity securities20,659 (5,533)41,871 3,796 
Net realized investment gains (losses) (8)4,274 6,737 913 
Change in allowance for credit losses on investments4 (143)490 (199)
Other income518 340 1,577 1,081 
Total revenues418,058 314,367 1,175,402 873,278 
Expenses
Losses and loss adjustment expenses200,240 155,552 580,351 441,628 
Underwriting, acquisition and insurance expenses70,139 60,348 207,960 168,567 
Interest expense2,589 2,573 7,575 7,867 
Other expenses692 401 3,451 1,220 
Total expenses273,660 218,874 799,337 619,282 
Income before income taxes144,398 95,493 376,065 253,996 
Total income tax expense30,169 19,378 70,316 49,290 
Net income114,229 76,115 305,749 204,706 
Other comprehensive income (loss)
Change in net unrealized losses on available-for-sale investments, net of taxes63,464 (23,511)47,866 (20,109)
Total comprehensive income$177,693 $52,604 $353,615 $184,597 
Earnings per share:
Basic$4.93 $3.30 $13.21 $8.89 
Diluted$4.90 $3.26 $13.10 $8.79 
Weighted-average shares outstanding:
Basic23,175 23,058 23,150 23,036 
Diluted23,335 23,315 23,333 23,298 






8

KINSALE CAPITAL GROUP, INC. AND SUBSIDIARIES
Unaudited Condensed Consolidated Balance Sheets

September 30, 2024December 31, 2023
Assets(in thousands)
Investments:
Fixed-maturity securities at fair value
$3,467,038 $2,711,759 
Equity securities at fair value365,626 234,813 
Real estate investments, net15,045 14,791 
Short-term investments— 5,589 
Total investments3,847,709 2,966,952 
Cash and cash equivalents111,691 126,694 
Investment income due and accrued26,083 21,689 
Premiums receivable, net134,952 143,212 
Reinsurance recoverables, net318,636 247,836 
Ceded unearned premiums55,370 52,516 
Deferred policy acquisition costs, net of ceding commissions
110,590 88,395 
Intangible assets3,538 3,538 
Deferred income tax asset, net34,995 55,699 
Other assets88,679 66,443 
Total assets$4,732,243 $3,772,974 
Liabilities & Stockholders' Equity
Liabilities:
Reserves for unpaid losses and loss adjustment expenses$2,160,763 $1,692,875 
Unearned premiums844,701 701,351 
Payable to reinsurers43,215 47,582 
Accounts payable and accrued expenses39,780 44,922 
Debt184,053 183,846 
Other liabilities24,782 15,566 
Total liabilities3,297,294 2,686,142 
Stockholders' equity1,434,949 1,086,832 
Total liabilities and stockholders' equity$4,732,243 $3,772,974 







9
v3.24.3
DEI Document
Oct. 24, 2024
Document and Entity Information [Abstract]  
Document Type 8-K
Document Period End Date Oct. 24, 2024
Entity Registrant Name KINSALE CAPITAL GROUP, INC.
Entity Incorporation, State or Country Code DE
Entity File Number 001-37848
Entity Tax Identification Number 98-0664337
Entity Address, Address Line One 2035 Maywill Street
Entity Address, Address Line Two Suite 100
Entity Address, City or Town Richmond
Entity Address, State or Province VA
Entity Address, Postal Zip Code 23230
City Area Code 804
Local Phone Number 289-1300
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, par value $0.01 per share
Trading Symbol KNSL
Security Exchange Name NYSE
Entity Emerging Growth Company false
Amendment Flag false
Entity Central Index Key 0001669162
Grafico Azioni Kinsale Capital (NYSE:KNSL)
Storico
Da Ott 2024 a Nov 2024 Clicca qui per i Grafici di Kinsale Capital
Grafico Azioni Kinsale Capital (NYSE:KNSL)
Storico
Da Nov 2023 a Nov 2024 Clicca qui per i Grafici di Kinsale Capital