管理層發言
Good day, ladies and gentlemen, and welcome to the 1Q 2026 Arch Capital Earnings Conference Call. The operator provided instructions. As a reminder, this conference call is being recorded. Before the company gets started with its update, management wants to first remind everyone that certain statements in yesterday's press release and discussed on this call may constitute forward-looking statements under the federal securities laws. These statements are based upon management's current assessments and assumptions and are subject to a number of risks and uncertainties. Consequently, actual results may differ materially from those expressed or implied. For more information on the risks and other factors that may affect future performance, investors should review the periodic reports that are filed by the company with the SEC from time to time, including our annual report on Form 10-K for the 2025 fiscal year. Additionally, certain statements contained in the call that are not based on historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The company intends the forward-looking statements in the call to be subject to the safe harbor created thereby. Management also will make reference to certain non-GAAP measures of financial performance. The reconciliations to GAAP for each non-GAAP financial measure can be found in the company's current report on Form 8-K furnished to the SEC yesterday, which contains the company's earnings press release and is available on the company's website at www.archgroup.com and on the SEC's website at www.sec.gov. I would now like to introduce your host for today's conference, Mr. Nicolas Papadopoulo, and Mr. Francois Morin. Sirs, you may begin.
Good morning, and welcome to Arch's First Quarter 2026 Earnings Call. We delivered a strong quarter, reflecting both attractive underwriting margin and the disciplined execution of our underwriting and capital management strategies. After-tax operating income for the quarter was $901 million or $2.50 per share, producing an annualized net income return on average common equity of 17.8%. Today's market is clearly more competitive than in recent years. That said, rates and terms and conditions in aggregate still support strong returns. Capturing those returns requires the ability and willingness to actively manage the portfolio across and within lines of business. This is embedded in Arch's operating principles and among our differentiating traits to dynamically add to areas where returns are attractive while declining those risks that no longer provide an adequate margin of safety. Regardless of where we are in the cycle, Arch is committed to generating superior returns for our shareholders. I'll now provide updates across our reporting segments, beginning with insurance, which generated $66 million of underwriting income in the first quarter. It compares favorably to the first quarter in 2025 that was impacted by the California wildfires. Overall, market conditions remained favorable. However, top line growth in the segment was essentially flat in the quarter, reflecting our focus on profitability over volume as competitive pressures increase. Growth opportunities remain across most casualty-focused businesses, including excess and surplus line casualty, construction, alternative market as well as a number of our London market businesses. Growth was offset by softening rates in a few areas, including large account and excess and surplus lines property as well as in some short-tail lines in London. We also chose not to renew certain program business acquired in the middle market commercial transaction that did not align with our risk appetite or meet our profitability requirements. As we have discussed on prior calls, these nonrenewals are expected to reduce net premiums written by approximately $250 million throughout 2026. I also want to note a significant operational milestone achieved in our middle market commercial business. Earlier this month, our team successfully completed the data and system migration of the acquired businesses from Allianz to Arch systems. The ability to complete this effort in just 18 months speaks not only to the dedication of our teams but also represents a strong use case for artificial intelligence in accelerating systems and platform transformation. With a significant step completed, the business can now pursue its objective of creating a scalable best-in-class experience for clients and distribution partners. Our reinsurance segment delivered an excellent $441 million of underwriting income in the quarter, a significant increase from the $167 million in the first quarter of 2025 which was heavily impacted by the California wildfires. Rate reductions and increased retention by our cedents contributed to a 6% decline in net premiums written versus the same quarter last year. Short-tail lines, including other property, property catastrophe and marine were the primary driver of these declines. Strong industry results over the past few years attracted significant new capacity from traditional markets and third-party capital, resulting in a broadly competitive environment. This additional supply continues to put downward pressure on property catastrophe and short-term rates while also moderating the push for needed rate increases in some casualty lines. However, underwriting performance remains excellent. Our focus and disciplined underwriting led to the reinsurance group's 76% combined ratio, marking the fourth straight quarter of sub-80% combined ratios. Consistent with our cycle management philosophy, our reinsurance team actively manages the portfolio mix by continuing to write new business, aim for a risk-adjusted return target and by reducing our share of business that falls below our minimum return thresholds. The mortgage segment delivered another strong quarter with $221 million of underwriting income to go along with $266 million of net premiums earned. Mortgage originations picked up modestly in the first quarter, though affordability challenges tied to high mortgage rates and home prices continue to constrain demand. Credit quality across the mortgage insurance portfolio remains excellent with delinquencies normalizing from seasonally higher levels in the fourth quarter of 2025. Competition remains disciplined and we continue to pursue growth through innovation and new product introductions across our global footprint. Overall, mortgage performance continues to exceed expectations and provide shareholders with a differentiated and diversifying source of earnings that support long-term value creation. Turning to investments, which contributed $408 million or $1.13 of net investment income per share in the quarter. The decline in net investment income from the fourth quarter of 2025 was driven in part by lower cash yields, lower qualified refundable tax credit benefits and seasonal compensation payouts. Our nearly $48 billion investment portfolio provides a material contribution to earnings and book value growth, effectively raising our quarterly earnings flow. In the first quarter, we repurchased $783 million worth of our common stock while still increasing book value per share by 1.7%. Our first priority remains to deploy capital into our business. When organic opportunities do not meet our return threshold, we view repurchasing our shares as an attractive use of excess capital, reflecting our conviction in the intrinsic value of the franchise. The Board's recent $3 billion increase to our share repurchase authorization underscores its approach to capital allocation. To conclude, Arch delivered another strong quarter, true to our principles of disciplined cycle management and by leveraging the strengths of the Arch brand and our diversified platform. In today's market, underwriting discipline powered by insights from our investment in data and analytics, rewarding our underwriter for profit and volume, and prudent capital management continues to differentiate Arch and drive long-term value for our investors. Arch's 25-year record of strong returns and compounding book value at double-digit rates is a direct result of hard work and discipline. That is Arch. That is our DNA, and that is why we believe we will continue to deliver best-in-class results across market cycles and into the future. I will now turn the call over to Francois, who will talk through the financials in more detail. Francois?
Thank you, Nicholas, and good morning to all. Last night, we reported our first quarter results with after-tax operating income of $2.50 per share and an annualized operating income return on average common equity of 15.4%. Book value per share grew by 1.7% in the quarter. Our three business segments once again delivered excellent underlying results with an overall ex-cat accident year combined ratio of 82.3%, up 130 basis points from the same quarter last year and consistent with the more competitive environment we are facing. I will provide more color on trends in each of our segments shortly. Our underwriting income included $200 million of favorable prior year development on a pretax basis in the first quarter, or 5 points on the overall combined ratio. We recognized favorable development across all three of our segments and in many of our lines of business, but mainly in short-tail lines in our P&C segments and in mortgage due to strong cure activity. Of note this quarter, we commuted a large transaction, which increased the level of favorable prior year development in our reinsurance segment by approximately 25% in the quarter. Current year catastrophe losses were $174 million, net of reinsurance and reinstatement premiums and were mainly the result of winter storms in the U.S. and the Iran conflict. All in, these losses were slightly lower than our seasonally adjusted expectations for natural catastrophes. The insurance segment's gross premiums written grew 2% while net premiums written declined 1.4% year-over-year. As Nicholas explained, the nonrenewal of certain program business acquired as part of the MCE transaction impacted our top line this quarter. In addition, net premiums written were also impacted by a shift in business mix toward lines with lower net-to-gross retention ratios. The ex-cat accident year loss ratio improved by 70 basis points to 56.7% compared to the same quarter one year ago. The acquisition expense ratio for the current accident year increased by 160 basis points as the benefit we observed in the first quarter of 2025 from the write-off of deferred acquisition costs from the MCE acquired business rolled off. We would expect the most recent acquisition expense ratio to be more representative of long-term expectations. Our operating expense ratio was higher this quarter as we incurred additional expenses related to the transition of our middle market business to Arch systems. We would expect our operating expense ratio to revert back to a level closer to historical levels during the second half of the year. The reinsurance segment had an excellent quarter with $441 million in pretax underwriting income. Overall, gross premiums written were down by 2.3%, while net premiums written were down by 6% from the same quarter one year ago. Net premiums written were up in specialty partly due to timing differences in the recognition of certain treaty renewals that impacted our financials in the first quarter of 2025. Over one-third of the decrease in net premiums written in property catastrophe was attributable to a lower level of reinstatement premiums compared to a year ago, which were impacted by the California wildfires. Overall, our ex-cat accident year combined ratio of 78.1% is comparable to last year's results for the same quarter. Our mortgage segment produced another very strong quarter with underwriting income of $221 million. Net premiums earned were down by approximately $6 million from last quarter, mostly driven by lower levels of cancellation premiums in our CRT business. Of note this quarter, new insurance written at USMI reflects a large non-GSE transaction of $2.2 billion in NIW. Absent this transaction, which increased our NIW by 15%, we would expect our market share of the PMI market to remain relatively unchanged from the prior quarter. The delinquency rate for our U.S. MI business decreased to 2.06%, consistent with our expectations and seasonal trends. On the investment front, we earned a combined $568 million from net investment income and income from funds accounted for using the equity method, or $1.57 per share pretax, slightly down from the $1.60 per share we earned last quarter. Cash flow from operations remained positive at $1.2 billion for the quarter. Our portfolio remains very high quality with a short duration and in line with our asset allocation targets. Income from operating affiliates was $36 million for the quarter, up from $17 million from the same quarter one year ago, which was impacted by the California wildfires. As a reminder, this quarter's result reflects our lower ownership stake in Summer Re since the start of the year. Our effective tax rate on pretax operating income was 14.8%, reflecting the mix of income by tax jurisdiction. It was slightly below the 16% to 18% previously guided range mostly due to a 1.7% benefit from discrete items. As of January 1, our peak zone natural catastrophe probable maximum loss from a single event at the 1-in-250-year return level on a net basis remained flat at $1.9 billion and now stands at 8.2% of tangible shareholders' equity. On the capital management front, we repurchased $783 million of our shares in the quarter or 8.3 million shares. We have repurchased an additional $311 million in shares so far this quarter through last night. Our balance sheet remains in excellent health with strong capitalization and low leverage. With these introductory comments, we are now prepared to take your questions.
分析師問答
Our first question comes from Elyse Greenspan from Wells Fargo.
My first question is on property cat on the reinsurance side. I was just hoping to get some of your expectations for the midyear renewals? And then if you expect declines in the book to continue, would you expect your cat load to come down after the mid-years?
Yes. Elyse, as we always say, we don't have a crystal ball, but for the 6/1 renewals, I think we really expect the market to remain competitive and we will adjust our underwriting stance based on the actual rate decreases that we see at that time. So we don't really have a specific forecast there. On the overall trend of the catastrophe portfolio, I think we face significant headwinds because of the double-digit rate decrease and we really — as I said in prior calls, we monitor the property catastrophe portfolio through a lens of 50 separate zones. Two years ago many zones were all green. Now we have a bunch that are still green; Florida is still green, but we have a number that are yellow and some that are challenged. So depending on where the business renews and our perception of the attractiveness of that zone, our underwriting team makes the decision.
Okay. And then on the casualty side, you mentioned still some good opportunities, I think, on both the insurance and the reinsurance side. Can you just talk through within casualty where you're currently seeing the best growth opportunities?
Yes. I think we're still optimistic on casualty. We think the pain is not gone yet. As you may have seen, we're still seeing some development from years like 2016 and 2017, and there has been some additional adverse development in more recent years. That should, in our view, continue to sustain price increases above trend. In terms of our risk appetite on the insurance and reinsurance side, it hasn't changed. We like specialty casualty, excess and surplus line casualty, and primary positions on large accounts. That's where we play. We stay away from commercial auto and also the larger account excess towers, which we think are still very challenging despite some of the rate increases we've seen.
Our next question comes from David Motemaden from Evercore ISI.
I was hoping maybe just to get an update on the insurance book where we stand just on rate versus trend in both the U.S. and internationally.
So starting with the U.S., we're broadly getting rate at trend. As I mentioned earlier, we're getting rate above trend on the casualty lines of business. The bigger pressure is on short-tail property lines where we've seen a rapid rate decrease. Summed up for North America, we're seeing rate slightly below trend. Internationally, we have more short-tail lines, so we're seeing rate pressure there as well. Overall, low single-digit rate decreases versus trend, but we started with pretty high margins, so we feel good about the business.
Got it. And then I believe you mentioned just in reinsurance, some of the supply there and good returns in short-tail lines trickling into casualty re. Does that change how you're thinking about growth opportunity there as an offset to the headwinds on the property side?
On casualty reinsurance, we are mainly talking about quota share structures. We like the fundamentals of specialty casualty, but the difficulty is the ceding commissions. Based on past casualty markets, ceding commission should have gone down, but with excess supply there's a lot of competitors wanting to get into that business or increase share, which has kept ceding commissions flat even as top accounts continue to improve. Sidecars are the latest flavor of the day in casualty and they will add to that dynamic.
Our next question comes from Tracy Benguigui from Wolfe Research.
One of the largest primary insurers said on their earnings call some pretty pessimistic views of property pricing, particularly shared and layered in North America and in London, and the culprit was cheaper forms of capital coming in from MGAs, reinsurers and alternative capital. From your vantage point, is this a real structural shift in the market? And how does that influence your underwriting appetite?
For us it's more business as usual. The advantage we have is that we are not a large retail large account player; we don't play in that space. We focus on excess and surplus line property business. That space is getting competitive and we are taking a very careful approach to that line of business right now.
Excellent. There was also a recent settlement development early in the second quarter around the Francis Scott Bridge collapse. Are you currently sizing industry loss? Has that pushed your loss estimate upward?
In that particular case, we were holding a much more conservative estimate than many in the market. So there was no real change for us.
Our next question comes from Mike Zaremski from BMO.
In the insurance segment, the underlying loss ratio continues to show some healthy improvement. Can you talk about some of the drivers? I believe some of the nonrenewals on some programs is helping, but can you talk around the dynamics we should consider?
Yes. This quarter, we benefited from a relatively benign amount of attritional losses in London in particular, so our international segment book did very well this quarter. That explains most of the favorable reduction in the ex-cat loss ratio compared to a year ago. As a reminder, we'd encourage you to look at trailing 12-month rolling numbers to get a view on performance of the book. The impact of the MCE nonrenewals is yet to be fully seen as the business earns out; we don't think it will be material given the size of the insurance book relative to the MCE programs. So at this time, the quarter was largely driven by strong performance out of London.
Got it. And Francois, you mentioned on the catastrophe side that this quarter's losses were a bit lower than normal and you also added a bit on the Iran conflict. Can you elaborate on the Iran conflict? Is it all IBNR, are there real losses or...?
There's nothing paid yet, but there are real losses in specialty lines out of London, such as terror and political violence. It's ongoing. We took a first stab at it this quarter based on what had happened in March, but we expect more losses to come through in the second quarter and we'll keep reporting on it. We were able to absorb those losses in the first quarter as part of our overall cat load, even though technically the cat load is only on the natural catastrophe side. We are treating this as a man-made catastrophe event in our reporting.
Our next question comes from Andrew Kligerman from TD Cowen.
Could you share a sense of where you are seeing risk-adjusted returns in property catastrophe reinsurance? If you had to gauge a risk-adjusted return range today, what are we seeing? And maybe the same question for E&S property you've been writing.
We manage property catastrophe dynamically by zone. Two or three years ago we were seeing returns in the 30s. The mix on the book today has shifted, but the business we have on the book remains attractive because we are not writing business that falls below our return thresholds. We believe the business on our book today remains attractive and we are still in the high teens on risk-adjusted returns.
So it sounds like there is business out there that Arch won't write that is well below your upper-teens return threshold. Is that fair?
That's fair.
Our next question comes from Cave Montazeri from Deutsche Bank.
First question is on share repurchases. It was nice to see a little uptick this quarter. If current pricing trends continue and you don't need capital to grow, is there any reason you couldn't pay out of income potentially even more? I guess I don't want to sound greedy, but what held you back from doing more this quarter?
There's nothing stopping us. We don't set hard targets for how much to buy back. We look at opportunities based on the stock price and liquidity in the stock. So far liquidity isn't a problem. The Board reauthorization gives you a sense of how we think about the opportunity. Whether we buy back more this quarter or next depends on what we see in the market. There are regulatory constraints to consider, but nothing structural preventing more buybacks if we choose to do so.
My second question is on cyber insurance. Can you help separate cyclical versus structural elements? Where are we in the underwriting clock for cyber? And structurally, given AI developments, does that change your view of tail risk, aggregation risk, or insurability over the long term?
I'd place cyber around mid-cycle — I'd say roughly 3:00 p.m. on the underwriting clock; it's getting to a later point but still manageable. In terms of AI, models like Anthropic's Mythos are a real threat in accelerating the speed and scale of attacks. But defenders can also use the same technology to strengthen protections. We view it as an acceleration of an ongoing arms race between attackers and defenders which increases systemic risk; we're taking a careful approach in our RDS scenarios and modeling.
Our next question comes from Josh Shanker from Bank of America.
Broadly speaking, do you expect Arch's and the industry's loss ratios to begin to deteriorate from here as pricing softens, or do you think current levels are supportable?
I can't speak for the industry. For Arch, we're confident in our ability to manage the cycle. If things fall below our thresholds, we reduce exposure. We believe we can continue to find attractive opportunities to expand where appropriate. Property is clearly softening, but we see opportunities on casualty. Based on our mix, rates are slightly below trend which supports the view that margins are sustainable in the near term.
On the SME commercial business and the mid-core acquisition, has it helped you capture incremental share in the less cyclical middle-market business in 2026?
We just completed the cutover as I mentioned, so our main focus was to roll over the portfolio and create a full underwriting workbench on Arch paper. Now that the cutover is done, we can pursue improving the value proposition and scale. I would view that as more of a 2027 initiative: stabilize, build tools to help underwriters with triage and selection, and then drive productivity and growth.
Our next question comes from Rob Cox with Goldman Sachs.
Question on premium leverage. The business is shifting away from property and property cat, which should allow for an increase to premium leverage. But historically it's been hard to rightsize leverage in a softening market due to lack of growth opportunities. Do you foresee premium leverage continuing to fall as the market softens? How does that impact your view on future ROEs?
We're managing the equity side of leverage. If we can't grow and deploy capital organically, we'll return more capital to shareholders, as we've been doing. That's a tool to keep ROEs attractive. If the mix goes more long-tail than short-tail, it helps leverage. We'll watch the equity component carefully and use buybacks as needed.
Follow-up on terms and conditions: did negotiations on terms and conditions start to change in the quarter in property cat reinsurance, and which terms could start to be further negotiated as the market softens?
We've seen a bit more at the margin, such as more aggregates and more top-end drops, but so far that remains a small portion. As the market gets more competitive, we would expect more of those complex structures to come back to market and to be negotiated.
Our next question comes from Ryan Tunis with Cantor.
The company is much larger than it was seven years ago, both from a premium and OpEx perspective. A lot of that increase in OpEx supports hard-market growth. Now not in a hard market, to what extent are you looking at managing OpEx as a potential source of boosting margins?
Yes, we are paying attention to expense management. As markets soften, expense becomes more important. The loss ratio is still a primary driver, but expense control, especially in the insurance group, is a focus for us.
Follow-up for Francois: the underlying loss ratio in the mortgage insurance segment looked a little elevated. Is that seasonal or should we interpret that differently?
Some of it is due to the change in the average mortgage size going into notice-of-default. Loans currently entering NOD are from more recent vintage years post-COVID when mortgage sizes were larger. Frequency assumptions have been stable, but severity per loan is influenced by average loan size hitting the loss ratio. So it's an evolving, somewhat seasonal effect and remains within our expectations.
Our next question comes from Alex Scott with Barclays.
Following up on excess capital: beyond buybacks, does the lack of obvious organic targets create a need to consider diversifying transactions? And is investing in AI to drive growth something you see as achievable?
All three businesses are doing well but growth opportunities are somewhat limited across the board. We are returning capital rather than accumulating excess beyond what we think is prudent. We look at M&A selectively — any transaction must be truly additive and improve our competitive position. We're open-minded and exploring ideas. On AI, it's coming quickly; we're exploring ways to automate and gain productivity, but it's early innings.
We've been investing in AI and machine learning for years in mortgage and P&C and have deployed models. The industry challenge is showing measurable results while building a data strategy and systems to support AI at scale. The technology is changing rapidly, so you must balance investment in productivity with preparing for what AI looks like in three years. It's a lot of investment but offers substantial opportunity for underwriting insight and productivity.
As a follow-up, can you talk about exposure to private credit within the fixed maturity part of the book?
We have some private credit exposure but it's limited, both in public and private markets. Our strategy has been to focus on higher-quality loans with low loan-to-value and good collateral. We're watching developments, but we have no red flags that require action at this point.
Our next question comes from Matthew Heimermann with Citi.
Following up on using AI in the technology rollover of mid-corp: how was that experience different than past migrations?
The biggest help from AI was in writing code and especially in accelerating testing. Much of the testing that used to be manual was automated, which sped up time to market. That was the key benefit for the migration.
To add, we effectively built a brand-new platform infrastructure for the acquired business. Because we had to create systems Arch did not have, AI capabilities helped speed up that process.
To make sure I understand use of the word testing correctly, is that auditing output or running scenarios to validate behavior?
Running scenarios to ensure that the new platform behaves as expected. When you create new software, you have a lot of testing to make sure every function works. Much of that testing can now be done through AI rather than manual tests by many individuals.
Our next question comes from Meyer Shields with KBW.
Francois, I expected operating expense in reinsurance to go down because of Bermuda tax credits. I didn't see that. Can you talk through the moving parts relative to last year?
Compared to last quarter, expenses are up. Relative to last year, yes, QRTC benefits existed in reinsurance, but the increase this year reflects investments in staffing and building out the reinsurance group, including technology hires and system improvements. There was also some noise: certain structured deals written a year ago benefitted expense ratios at that time, so when you adjust for that, it explains some of the difference. There's nothing structural surprising here.
Reports suggest significant rate increases for product lines exposed to the Iran conflict. Is Arch trying to write more of that business or being cautious because of the risk?
We do write some political violence and terrorism lines out of our London office. We've been cautious, but rates have spiked, so we have written a little more business in a careful way.
Our next question comes from Rowland Mayor from RBC Capital Markets.
On your PML disclosure, do you think catastrophe models fully capture the improved loss environment in Florida from reforms like AOB benefits reform?
Yes, our modeling has been updated. We have specific loads and adjustments for features of the Florida market and the reforms, including changes related to fraud and claim handling expense. That's reflected in our modeling and disclosures.
Our next question comes from Brian Meredith with UBS.
Your PMLs didn't decline and stayed the same at 4.1% versus your 1/1 disclosure, despite declining property cat and everything. Can you help reconcile what's going on with PMLs relative to what you're doing with property reinsurance and insurance?
Think of the 4.1% as the peak zone. I wouldn't expect a ton of activity to change that at present. I would expect more meaningful changes potentially after 6/1 and 7/1 renewals depending on our actions in those windows. There wasn't a lot of activity at the 4.1 renewal that would materially impact that zone.
But even between September and 1/1 it went up despite the reduction in business at 1/1 renewals. Is that about changes in rate or are you dropping exposure as well?
At 1/1 we held most business and actually grew a little in some areas. We gave up some rate, so returns weren't as good as the year before, but dollars of PML didn't change materially. Often you lose one account and replace with another so dollars can move around. 6/1 and 7/1 are the renewals to watch for more meaningful change.
As we said earlier, Florida remained a zone where we saw attractive returns, so we didn't reduce exposure there; we looked to write more at the margin.
Our next question comes from Pablo Singzon with JPMorgan.
Nicolas, following up on casualty sidecars: do you think this is a blip or is there a risk casualty could face the same structural headwind that property cat experienced from alternative capital?
It's hard to tell. It's not helping the market. One mitigation is security or quality of capital: many buyers using sidecars are doing so because they want to write business they otherwise wouldn't, and claims in casualty can develop over five, six, seven years. If the vehicle or cedent lacks staying power, that could be a deterrent compared to property catastrophe where losses are more immediate and capital providers can see the exposure sooner. So that may mitigate some of the structural risk that happened in property.
Our next question comes from Yaron Kinar with Mizuho.
Can you break out the man-made Iran-related losses for insurance and reinsurance and maybe share associated earned premiums?
We don't break out those man-made losses separately; we report them as part of catastrophe losses. Those lines — political violence, terrorism — are priced into those portfolios. If you'd like, we can do a detailed offline discussion to walk through premiums and exposure by line.
To give some context, the market's estimated losses from political violence related to this event are roughly $3 billion, and we estimate the premiums for those lines of business to be around $2 billion. That's a rough sense of scale across the market.
Because looking forward, I want to make sure we're using the right base for underlying loss ratios when some losses may not be fully captured in reported underlying metrics. Following up, in the insurance book I saw other liability claims-made grew nicely in the quarter. What drove that?
That's really transaction liability. We write transaction liability in North America and in London, and the growth was driven by higher pricing in that line and increased M&A activity in the last couple of quarters.
I'm not showing any further questions. Would you like to proceed with any further remarks?
Yes, I want to thank you all for participating on our call. We feel good about the business, though the market environment is challenging. Our teams are equipped and ready to compete in that environment and generate strong returns for our shareholders. Thank you.
Ladies and gentlemen, thank you for participating in today's conference. This concludes the program. You may all disconnect.