Employers Flips Third-Quarter Loss to Profit

The Tip Desk · November 10, 2026 · 3 min read

Net income was $11.6 million, or $0.64 a diluted share, as the loss and LAE ratio fell to 71.2% and net premiums earned declined 17%.

Employers Holdings, Inc. (EIG), a holding company with subsidiaries that are specialty providers of workers’ compensation insurance, excess workers’ compensation, and related services, reported net income of $11.6 million, or $0.64 a diluted share, for the third quarter ended September 30, 2026, versus a net loss of $8.3 million, or $(0.36) a diluted share, a year earlier.

Chief Executive Officer Katherine Antonello said the improvement was driven primarily by the absence of the reserve strengthening recorded in the year-ago quarter, and that the company had not recognized any prior-year loss development on voluntary business this year. Losses and LAE were $114.0 million, down 38.9%, due primarily to the absence of about $38.0 million of prior-period reserve strengthening and partially due to lower premium levels. The loss and LAE ratio fell to 71.2% from 97.1%.

Gross premiums written were $151.1 million, a 17.8% decline. Net premiums earned were $160.2 million, down 17%. The company said those decreases reflected pricing and underwriting actions taken to prioritize profitability in a prolonged soft market. Policies in force declined 8% to 124,043. Antonello said the policy count fell less than premium because the company retained the majority of its small-business customers while exiting selected classes of business.

The GAAP combined ratio improved to 108.4% from 129.7% a year earlier, or 109.2% excluding the LPT. The voluntary-business current accident-year loss and LAE ratio, excluding the LPT, was 72.0%. Underwriting expenses were $38.9 million, down 1.8%, but the underwriting expense ratio rose to 24.3% from 20.6% because of the smaller premium base. Commission expense was $20.6 million, down 10.4%; the commission expense ratio was 12.9%. The company said the commission-ratio increase reflected higher commission rates on 2026 new business and a one-time adjustment that had reduced the 2025 third-quarter ratio.

Net investment income increased 23.8% to $32.3 million from $26.1 million a year earlier. The company said the increase was primarily the result of returns from private equity investments, including $5.6 million in returns, along with higher yields on fixed-maturity securities after 2025 rebalancing. Net realized and unrealized investment results were a $3.2 million loss versus $21.2 million of gains a year earlier, which the company attributed to a distribution-related reduction in private-equity net asset value and reduced common-equity gains. Interest and financing expenses were $1.3 million versus $0.2 million a year earlier, related to $125.0 million of senior debt from the fourth-quarter 2025 recapitalization.

Book value per share including the Deferred Gain was $49.44, down 5.3% from the prior quarter including dividends, which the company said was driven by an unrealized market-value decline in fixed-income investments from higher interest rates rather than credit quality. Adjusted book value per share was $53.64, up 1.3% sequentially including dividends. Year over year, book value including the Deferred Gain rose 2.1% and adjusted book value rose 7.1%, both including dividends declared.

The company returned $24.4 million to stockholders in the third quarter through share repurchases and regular quarterly dividends. It repurchased 373,848 shares at an average $48.44 a share and had $94.9 million of remaining authorization under the 2026 Program. The board declared a regular quarterly dividend of $0.34 a share, payable December 3, 2026, to stockholders of record November 12, 2026.

Antonello said the excess workers’ compensation product launched in June had 31 accounts and $6.5 million of premium to date, and that a large-deductible product is targeted to launch next year.