United Fire's Third-Quarter Combined Ratio Deteriorates

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

Net income fell 10% to $35.1 million, or $1.34 a share, as the combined ratio rose 2.7 points to 94.6%.

United Fire Group, Inc. (UFCS) reported third-quarter net income of $35.1 million, or $1.34 a share, down 10% from a year earlier, as the combined ratio rose 2.7 points to 94.6% from 91.9% in the third quarter of 2025. Adjusted operating income, which excludes after-tax net investment gains and losses, was $35.1 million, or $1.34 a share.

The property-and-casualty insurer said the year-ago combined ratio had been its best third-quarter result in nearly 20 years, making the 94.6% print a step back from that unusually strong comparison. Prior-year reserve development remained neutral.

Net written premium rose 13% to $371.4 million, a faster pace than the 9% increase recorded in the second quarter. Net earned premium increased 10.4% to $362.5 million. The company said growth was led by its core commercial book. Core commercial average renewal premium rose 3.0%, with rates up 2.0% and exposure changes of 1.0%. Excluding workers’ compensation, average renewal premium increased 3.3%, with 2.4% from rate and 0.9% from exposure.

Commercial lines net written premium was $307.1 million. Other liability led at $120.3 million, followed by automobile at $83.2 million and workers’ compensation at $23.3 million. Fire and allied lines were $66.0 million and surety $14.0 million. Assumed reinsurance net written premium was $59.0 million. Personal lines net written premium was $5.3 million.

The combined-ratio increase was attributed primarily to the underlying loss ratio, which rose 1.3 points to 57.3%. The company said that move reflected lower favorable impacts in 2026 compared with an exceptional third quarter of 2025. Catastrophe losses added 1.1 points to a 2.4% loss ratio, which the company said was below both five-year and 10-year historical averages. The underwriting expense ratio was 34.9%. The underlying combined ratio was 92.2%.

Commercial lines net loss ratio was 58.7%. Other liability’s loss ratio fell to 67.4% from 72.8%. Workers’ compensation rose to 79.3% from 69.6%, and surety rose to 35.6% from 26.2%. Assumed reinsurance’s net loss ratio was 66.3%.

Net investment income increased 13% to $29.3 million. Interest on fixed maturities rose to $27.4 million, which the company attributed to portfolio growth and reinvestment at higher yields. Average pre-tax yield on fixed income securities was 4.65%. Income on other long-term investments was $1.3 million.

For the nine months ended September 30, 2026, the company said it achieved record net income and earnings per share. Net income for the period was $98.5 million, or $3.78 a share. The year-to-date combined ratio was 95.2%. Return on equity was 14.0% for the nine months.

Book value per share was $36.51 as of September 30, 2026, down $0.37 from December 31, 2025. The company said the decline was primarily attributable to an increase in unrealized investment losses on fixed maturity securities and shareholder dividends, offset by net income over the nine-month period. Net unrealized investment losses, after tax, were $113.9 million. Adjusted book value per share was $40.94. Invested assets were $2.53 billion.

During the third quarter the company declared and paid a $0.20 a share cash dividend. President and CEO Kevin Leidwinger said UFG delivered its strongest quarter of 2026 and that the company remains focused on pursuing profitable growth opportunities and maintaining underwriting discipline.