What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2026-02-26 compared with 2025-02-27 · 273 added, 278 removed, 1150 unchanged (32% of the section changed)

36 unchanged sentences

CURRENT OUTLOOK

As we head into 2025, our objective to deliver long-term value for our shareholders remains the same.

We will continue to execute on the key pillars of our strategy which are:

to build a diversified mix of businesses;

actively manage the underwriting cycle;

remain prudent stewards of the capital entrusted to us by our shareholders;

and be dynamic managers of a data-driven enterprise with a culture that attracts best-in-class talent.

Book value per share, a key measure of value creation, ended 2024 at $53.11, representing a 13.1% increase for the year and up 23.8% after adjusting for the impact of the $5 per share special dividend paid to common shareholders in December 2024.

The decision to pay a special dividend was the result of Arch's strong financial performance and capital position and represented an effective means of returning excess capital to our shareholders.

Overall, we believe the property and casualty environment remains favorable, despite increasing competition in many of our lines of business.

This makes underwriting and risk mitigation increasingly important.

Our underwriting strategies empower our businesses to respond quickly to their trading environment.

This has been, and remains, a competitive advantage as we have the agility and expertise to reallocate capital to more profitable opportunities across our diversified platform.

We are selectively deploying capital to the areas producing attractive risk-adjusted returns, such as insurance and reinsurance liability lines, specialty business at Lloyd's and property catastrophe reinsurance.

A high level of industry catastrophic losses throughout 2024, combined with the California wildfires at the start of 2025, should continue to support demand for property insurance and reinsurance.

Notwithstanding this increased loss activity, we believe the property market remains attractive.

On the casualty side, we believe that rates are continuing to outpace loss cost trends, and have selectively increased casualty writings in both our insurance and reinsurance segments.

Our property and casualty underwriting teams continued to benefit from attractive market conditions, delivering a combined $1.6 billion of underwriting income and over $20 billion of gross premiums written in 2024, up nearly 19% from 2023.

We reported very good results for 2025, with an annualized net income return on average common equity and operating return on average common equity of 20.1% and 17.1%, respectively.

See “ Comment on Non-GAAP Financial Measures .” Meaningful contributions from all three segments along with solid investment returns resulted in book value growth for 2025 of 22.6%.

Our strong balance sheet and capital-generating capabilities permit us to both invest in our business and return capital to investors.

During 2025, we repurchased $1.9 billion of Arch common shares.

As we head into 2026 with measured optimism and increased competition across our property and casualty businesses, our commitment to deliver long-term value for our shareholders remains unchanged.

Critical to our cycle management is emphasizing risk selection, as we continue to leverage our diversified specialty platform and the expertise of our underwriting teams.

We invest and use data and analytics to sharpen insights, enhance risk selection and deliver a differentiated customer experience while fostering a culture that attracts the best-in-class talent.

We closed 2025 with a balance sheet in excellent health, giving us optionality as we remain prudent stewards of the capital entrusted to us by our shareholders.

Our insurance segment reported $375 million of underwriting income in 2025, with net premium written nearly $7.8 billion, an increase of 13.4% from 2024.

Growth in net premiums written primarily resulted from the U.S MidCorp and Entertainment insurance businesses acquired from Allianz on August 1, 2024 (“MCE Acquisition”).

The acquired business further expands our insurance platform, providing more opportunities to capitalize on attractive margins.

Across the insurance platform, our underwriters continue to pursue growth in areas where risk-adjusted returns exceed or meet our long-term objectives.

In North America, the casualty rate environment is largely keeping pace with loss cost trends, while pricing in our international business units is tracking slightly below loss trends.

In North America, we continue to grow in specialty casualty lines, including alternative markets, construction and E&S casualty.

Within each geography, consistent with our cycle management approach, we adjust our business mix in response to changing market conditions and pricing dynamics.

ARCH CAPITAL 71

2025 FORM 10-K

Our reinsurance segment contributed $1.2 billion of underwriting income in 2024, despite the impact of catastrophic events.

At the January 1, 2025 renewals, we selectively increased our writings in property, liability and specialty lines with a focus not only on price adequacy, but also terms and conditions.

Our underwriting culture dictates that we include a meaningful margin of safety in our pricing, especially given competitive market conditions, and take a longer term view of inflation and rates.

As underwriting opportunities arise, our reinsurance segment reacts quickly and significantly when markets pivot.

Our insurance segment also seized on strong growth opportunities in 2024, while elevated catastrophe activity such as Hurricanes Helene and Milton limited underwriting income.

For the full year, the insurance group contributed $6.9 billion of net premium written, a 17% increase from 2023 and delivered $0.3 billion of underwriting income.

On August 1, 2024, we completed the acquisition of the U.S.

MidCorp and Entertainment insurance businesses from Allianz (“MCE Acquisition”).

As such, the insurance segment’s 2024 results include five months of activity related to the acquired business.

This acquisition expands our capabilities for insureds in the U.S.

middle markets and represents an important component of our insurance segment.

Excluding the MCE Acquisition, insurance growth was in the mid-single digits and included attractive opportunities in casualty, programs and in the London specialty market.

Looking ahead, we expect primary market conditions to remain competitive given the attractive underlying margins, which may result in a slowdown of new business opportunities.

Our mortgage segment continued to deliver a steady level of earnings for our shareholders, generating $1.1 billion of underwriting income in 2024, resulting in the third consecutive year of delivering over $1 billion of underwriting income.

While new originations remain tempered by relatively high mortgage interest rates, underlying fundamentals remained strong and our U.S.

Our reinsurance segment contributed $1.6 billion of underwriting income in 2025.

At the January 1, 2026 renewals, property catastrophe and more generally short-tail excess of loss renewals were highly competitive with rates down 10% to 20%.

Despite these headwinds, our underwriting teams leveraged the strength of our platform and trading relationships to source new opportunities that mitigate the impact of the rate pressure in the market.

We are growing selectively and focusing on areas where margins are attractive.

We continue to like our prospects in most lines of business and, with improving conditions in casualty lines, our agility and ability to create opportunities is an advantage for us in this market.

Our diversified reinsurance platform, supported by strong partnerships with brokers and cedants across multiple lines and geographies, further enhance our ability to navigate a competitive environment.

Our mortgage segment continued to deliver a steady level of earnings, generating $1.0 billion of underwriting income in 2025, resulting in the fourth consecutive year exceeding the $1 billion threshold.

While lower mortgage rates are beginning to support increased origination activity, the current market is still constrained due to affordability challenges.

Underlying fundamentals remained strong and our U.S.

market share was stable as industry pricing discipline held.

Our team remains focused on underwriting discipline, expense management and enhancing our data and analytical platforms to further optimize the business.

The persistency of our in-force U.S.

primary mortgage insurance portfolio remained a healthy 82.1% and the delinquency rate remained low.

primary mortgage insurance portfolio remained a healthy 81.8% and our delinquency rate remained low.

We continue to expect the mortgage segment to serve as a steady diversifying contributor to our overall earnings and generate attractive underwriting income given the high credit quality of our in-force portfolio.

FINANCIAL MEASURES

4 unchanged sentences

Book value per share is impacted by, among other factors, our underwriting results, investment returns and share repurchase activity, which has an accretive or dilutive impact on book value per share depending on the purchase price.

Book value per share was $53.11 at December 31, 2024, a 13.1% increase from $46.94 at December 31, 2023, and an increase of 23.8% when incorporating the impact of the $1.9 billion special dividend paid to common shareholders in December 2024.

Book value per share was $65.11 at December 31, 2025, a 22.6% increase from $53.11 at December 31, 2024.

The growth in book value per share in 2025 primarily reflected strong underwriting and investment returns.

Operating Return on Average Common Equity

Operating return on average common equity (“Operating ROAE”) represents annualized after-tax operating income available to Arch common shareholders divided by average common shareholders’ equity available to Arch during the period.

After-tax operating income available to Arch common shareholders, a “non-GAAP measure” as defined in the SEC rules, represents net income available to Arch common shareholders, excluding net realized gains or losses (which includes realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries), equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses, transaction costs and other, loss on redemption of preferred shares and income taxes.

After-tax operating income available to Arch common shareholders, a “non-GAAP measure” as defined in the SEC rules, represents net income available to Arch common shareholders, excluding net realized gains or losses (which includes, but is not limited to, realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries), equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses, transaction costs and other, loss on redemption of preferred shares and income taxes.

Management uses Operating ROAE as a key measure of the return generated to Arch common shareholders.

2 unchanged sentences

Our Operating ROAE was 17.1% for 2025, compared to 18.9% for 2024.

Returns for 2024 reflected strong underwriting and investment returns, albeit with an elevated level of catastrophe activity.

Returns for the 2025 period reflected strong underwriting and investment returns.

ARCH CAPITAL 72

10 unchanged sentences

Year Ended December 31, 2024 5.08 % 5.22 %

Total return for 2024 primarily reflected the effects of sustained higher interest rates available in the market, along with growth in invested assets due in part to strong operating cash flows.

Total return for 2025 primarily reflected the effects of lower bond yields, a weaker U.S.

dollar and equity market returns.

The portfolio slightly underperformed their benchmark returns, primarily due to the impairment and sale of certain alternative investments accounted for using the equity method.

The allocation of our portfolio remained neutral relative to our targeted benchmark.

We continue to maintain a relatively short duration on our fixed income portfolio of 3.34 years at December 31, 2025.

11 unchanged sentences

Treasury Index 15.00

ICE BofA 0-3 Month U.S.

Treasury Index 3.00

JPM CLOIE Investment Grade 6.00

ICE BofA U.S.

High Yield Constrained Index 6.00

ICE BofA 1-5 Year U.K.

Gilt Index 5.25

S&P 500 Total Return Index 4.75

ICE BofA U.S.

High Yield Constrained Index 5.00

ICE BofA U.S.

ABS & CMBS Index 4.70

S&P 500 Total Return Index 4.50

ICE BofA 3-5 Year US Agency CMO Excluding IO & PO Index 3.50

ICE BofA German Government 1-5 Year Index 3.25

ICE BofA German Government 5-7 Year Index 0.60

ICE BofA 0-3 Month U.S.

Treasury Index 3.00

ICE BofA 1-5 Year Canada Government Index 2.60

1 unchanged sentence

ICE BofA 1-5 Year Australia Government Index 1.90

ICE BofA U.S.

Mortgage Backed Securities Index 1.50

ICE BofA 5-10 Year Australia Government Index 0.45

ICE BofA 1-5 Year Japan Government Index 0.25

1 unchanged sentence

Throughout this filing, we present our operations in the way we believe will be the most meaningful and useful to investors, analysts, rating agencies and others who use our financial information in evaluating the performance of our company.

This presentation includes the use of after-tax operating income available to Arch common shareholders, which is defined as net income available to Arch common shareholders, excluding net realized gains or losses (which includes realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries), equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses, transaction costs and other, net of income taxes (which for the 2023 fourth quarter includes a one-time deferred income tax benefit related to the enactment of Bermuda’s new corporate income tax), and the use of annualized operating return on average common equity.

This presentation includes the use of after-tax operating income available to Arch common shareholders, which is defined as net income available to Arch common shareholders, excluding net realized gains or losses (which includes, but is not limited to, realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries), equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses, transaction costs and other, net of income taxes, and the use of annualized operating return on average common equity.

The presentation of after-tax operating income available to Arch common shareholders and annualized operating return on average common equity are non-GAAP financial measures as defined in Regulation G.

5 unchanged sentences

Furthermore, certain users of our financial information believe that, for many companies, the timing of the realization of investment gains or losses is largely opportunistic.

In addition, changes in the allowance for credit losses and net impairment losses recognized in earnings on the Company’s investments represent other-than-temporary declines in expected recovery values on securities without actual realization.

In addition, changes in the allowance for credit losses and net impairment losses recognized in earnings on our investments represent other-than-temporary declines in expected recovery values on securities without actual realization.

Furthermore, we exclude net realized gains or losses from the acquisition or disposition of subsidiaries, due to their non-recurring nature, such items are not indicative of the performance of, or trends in, our business performance.

The use of the equity method on certain of our investments in certain funds that invest in fixed maturity securities is driven by the ownership structure of such funds (either limited partnerships or limited liability companies).

The use of the equity method on certain of our investments funds that invest in fixed maturity securities is driven by the ownership structure of such funds (either limited partnerships or limited liability companies).

In applying the equity method, these investments are initially recorded at cost and are subsequently adjusted based on our proportionate share of the net income or loss of the funds (which include changes in the market value of the underlying securities in the funds).

This method of accounting is different from the way we account for our other investments and the timing of the recognition of equity in net income or loss of investments accounted for using the equity method may differ from gains or losses in the future upon sale or maturity of such investments.

This method of accounting is different from the way in which we account for our other investments;

and the timing of the recognition of equity in net income or loss of investments accounted for using the equity method may differ from gains or losses in the future upon sale or maturity of such investments.

Transaction costs and other include integration, advisory, financing, legal, severance, incentive compensation and all other transaction costs directly related to acquisitions.

We believe that transaction costs and other, due to their nonrecurring nature, are not indicative of the performance of, or trends in, our business performance.

In the 2023 fourth quarter, the Company established a net deferred income tax asset, resulting in a benefit of $1.18 billion, consistent with the transition provisions specified in the Bermuda CIT Act.

Due to the non-recurring nature of this one-time item, the Company believes that excluding this item from after-tax operating income or loss available to common shareholders provides the user with a better evaluation of the Company’s ongoing business performance.

We believe that showing net income available to Arch common shareholders exclusive of the items referred to above reflects the underlying fundamentals of our business since we evaluate the performance of and manage our business to produce an underwriting profit.

In addition to presenting net income available to Arch common shareholders, we believe that this presentation enables investors and other users of our financial information to analyze our performance in a manner similar to how management analyzes performance.

We also believe that this measure follows industry practice and, therefore, allows the users of financial information to compare our performance with our industry peer group.

We also believe that

this measure follows industry practice and, therefore, allows the users of financial information to compare our performance with our industry peer group.

We believe that the equity analysts and certain rating agencies that follow us and the insurance industry as a whole generally exclude these items from their analyses for the same reasons.

11 unchanged sentences

Management utilizes the current year loss ratio in its analysis of the underwriting performance of each of our underwriting segments.

Effective in the 2025 period, the ‘Other operating expense ratio’ includes ‘Other underwriting income.’

Total return on investments includes investment income, equity in net income or loss of investments accounted for using the equity method, net realized gains or losses (excluding changes in the allowance for credit losses on non-investment related financial assets) and the change in unrealized gains or losses generated by Arch’s investment portfolio.

Total return is calculated on a pre-tax basis and

ARCH CAPITAL 74

2025 FORM 10-K

Total return is calculated on a pre-tax basis and before investment expenses, and reflects the effect of financial market conditions along with foreign currency fluctuations.

before investment expenses, and reflects the effect of financial market conditions along with foreign currency fluctuations.

In addition, total return incorporates the timing of investment returns during the periods.

17 unchanged sentences

Annualized operating return on average common equity % 17.1 18.9

(1) Net realized gains or losses include realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains and losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries.

(1) Net realized gains or losses include, but is not limited to, realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains and losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries.

(2) Income tax on net realized gains or losses, equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses and transaction costs and other reflects the relative mix reported by jurisdiction and the varying tax rates in each jurisdiction.

The 2023 results were impacted by the establishment of a net deferred income tax asset of $1.18 billion, or $3.10 per share, related to the enactment of Bermuda’s new corporate income tax.

Segment Information

We classify our businesses into three underwriting segments insurance, reinsurance and mortgage.

We classify our businesses into three underwriting segments:

insurance, reinsurance and mortgage.

Our insurance, reinsurance and mortgage segments each have managers who are responsible for the overall profitability of their respective segments and who are directly accountable to our chief operating decision-makers, the Chief Executive Officer of Arch Capital and the Chief Financial Officer and Treasurer of Arch Capital.

4 unchanged sentences

The accounting policies of the segments are the same as those used for the preparation of our consolidated financial statements.

Intersegment business is allocated to the segment accountable for the underwriting results.

Inter-segment business is allocated to the segment accountable for the underwriting results.

Insurance Segment

7 unchanged sentences

Net premiums earned 7,771 6,627 17.3

Other underwriting income (1) 36 —

Losses and loss adjustment expenses (4,764) (4,070)

7 unchanged sentences

Combined ratio 95.2 % 94.8 % 0.4

The insurance segment consists of our insurance underwriting units which offer specialty product lines on a worldwide basis, as described in note 4, “Segment Information,” to our consolidated financial statements in Item 8.

(1) ‘Other underwriting income’ includes revenue earned from underwriting related activities covered under existing service contracts.

(2) The ‘Other operating expense ratio’ for the 2025 period includes ‘Other underwriting income.’ See ‘Comments on Non-GAAP Financial Measures’ for further details.

ARCH CAPITAL 75

2025 FORM 10-K

Net Premiums Written .

6 unchanged sentences

Other liability - claims made 793 10.2 858 12.5

Workers compensation 555 8.1 525 9.0

Commercial automobile 485 7.1 391 6.7

Commercial multi-peril 781 10.0 461 6.7

Commercial automobile 602 7.7 485 7.1

Workers compensation 576 7.4 555 8.1

Other 341 4.4 288 4.2

5 unchanged sentences

Total $ 7,798 100.0 $ 6,874 100.0

Net premiums written by the insurance segment were 17.3% higher in 2024 than in 2023 (7.0% excluding the MCE Acquisition).

Growth in net premiums written reflected the impact of the MCE Acquisition along with an increases in most lines of business due in part to new business opportunities and rate changes.

Net premiums written by the insurance segment were 13.4% higher in 2025 than in 2024.

Growth in net premiums written primarily reflected the impact of the MCE Acquisition.

Net Premiums Earned .

6 unchanged sentences

Other liability - claims made 786 10.1 843 12.7

Workers compensation 549 8.3 495 9.1

Commercial automobile 459 6.9 343 6.3

Commercial multi-peril 792 10.2 435 6.6

Commercial automobile 581 7.5 459 6.9

Workers compensation 591 7.6 549 8.3

Other 291 3.7 309 4.7

6 unchanged sentences

Net premiums written are primarily earned on a pro rata basis over the terms of the policies for all products, usually 12 months.

Net premiums earned by the insurance segment were 21.7% higher in 2024 than in 2023 (10.5% excluding the MCE Acquisition), reflecting changes in net premiums written over the previous five quarters.

Net premiums earned by the insurance segment were 17.3% higher in 2025 than in 2024, reflecting changes in net premiums written over the previous five quarters.

Other Underwriting Income (Loss).

Other underwriting income, which includes revenue earned from underwriting-related activities covered under existing service contracts, was $36 million in 2025, compared to nil in 2024.

Losses and Loss Adjustment Expenses .

6 unchanged sentences

Current Year Loss Ratio .

The insurance segment’s current year loss ratio was 3.8 points higher in 2024 than in 2023.

The 2024 loss ratio included 4.6 points of current year catastrophic event activity, primarily related to Hurricanes Helene and Milton, compared to 2.7 points in 2023.

The current year loss ratio for 2024 also reflected the impact of rate increases and changes in mix of business.

The insurance segment’s current year loss ratio in 2025 was consistent with 2024.

The 2025 loss ratio included 4.4 points of current year catastrophic event activity, compared to 4.6 points in 2024.

The current year loss ratio for the 2025 period also reflected the impact of the MCE Acquisition and changes in mix of business.

ARCH CAPITAL 76

2025 FORM 10-K

Prior Period Reserve Development .

3 unchanged sentences

The insurance segment’s underwriting expense ratio was 33.9% in 2025, compared to 33.4% in 2024.

The impact of the MCE Acquisition lowered the underwriting expense ratio by approximately 1.6 points, primarily due to the effects of the fair value estimation of the assets acquired at closing, including the non-recognition of deferred acquisition costs.

The value of policies in force at closing are considered within the value of business acquired which is amortized through ‘amortization of intangible assets.’ The underwriting expense ratio also benefited from an initial lower level of operating expenses in the acquired business.

ARCH CAPITAL 73

2024 FORM 10-K

Reinsurance Segment

7 unchanged sentences

Net premiums earned 8,122 7,242 12.2

Other underwriting income (loss) 9 17

Other underwriting income (1) 159 9

Losses and loss adjustment expenses (4,610) (4,327)

7 unchanged sentences

Combined ratio 80.8 % 83.2 % (2.4)

(1) ‘Other underwriting income’ includes revenue earned from underwriting related activities covered under existing service contracts.

(2) The ‘Other operating expense ratio’ for the 2025 period includes ‘Other underwriting income.’ See ‘Comments on Non-GAAP Financial Measures’ for further details.

The reinsurance segment consists of our reinsurance underwriting units which offer specialty product lines on a worldwide basis, as described in note 4, “Segment Information,” to our consolidated financial statements in Item 8.

3 unchanged sentences

Amount % Amount %

Other specialty $ 2,849 36.8 $ 2,412 36.8

Specialty $ 2,543 33.4 $ 2,849 36.8

Property excluding property catastrophe 2,043 26.8 2,264 29.2

4 unchanged sentences

Total $ 7,618 100.0 $ 7,746 100.0

Net premiums written by the reinsurance segment were 18.2% higher in 2024 than in 2023.

The growth in net premiums written reflected increases in all lines of business, primarily due to new business, rate increases and growth in existing accounts.

Net premiums written by the reinsurance segment were 1.7% lower in 2025 than in 2024.

The lower level of net premiums written primarily reflected non-renewals and share decreases in the specialty line of business offset, in part, by increases in casualty.

Net Premiums Earned .

2 unchanged sentences

Amount % Amount %

Other specialty $ 2,619 36.2 $ 2,097 35.9

Specialty $ 2,906 35.8 $ 2,619 36.2

Property excluding property catastrophe 2,252 27.7 2,148 29.7

5 unchanged sentences

Net premiums earned in 2025 were 12.2% higher than in 2024, reflecting changes in net premiums written over the previous five quarters, including the mix and type of business written.

ARCH CAPITAL 77

2025 FORM 10-K

Other Underwriting Income (Loss).

Other underwriting income in 2024 was $9 million, compared to $17 million in 2023.

Other underwriting income, which includes revenue earned from underwriting-related activities covered under existing service contracts was $159 million in 2025, compared to $9 million in 2024.

Losses and Loss Adjustment Expenses .

6 unchanged sentences

Current Year Loss Ratio .

The reinsurance segment’s current year loss ratio was 4.4 points higher in 2024 than in 2023.

The 2024 loss ratio included 11.8 points for current year catastrophic event activity related to Hurricanes Milton and Helene, and a series of other global events, compared to 6.8 points in 2023.

The current year loss ratio for 2024 also reflected the impact of rate increases and changes in mix of business.

The reinsurance segment’s current year loss ratio was 1.5 points lower in 2025 than in 2024.

The 2025 loss ratio included 8.5 points for current year catastrophic event activity, primarily related to the California wildfires, compared to 11.8 points in 2024, primarily related to Hurricanes Milton, Helene and a series of other global events.

The current year loss ratio for 2025 also reflected changes in mix of business.

Prior Period Reserve Development .

The reinsurance segment’s net favorable development was $322 million, or 4.0 points, for 2025, compared to $188 million, or 2.6 points, for 2024, See note 5, “Reserve for Losses and Loss Adjustment Expenses,” to our consolidated financial statements in Item 8 for information about the reinsurance segment’s prior year reserve development.

ARCH CAPITAL 74

2024 FORM 10-K

Underwriting Expenses .

The underwriting expense ratio for the reinsurance segment was 23.5% in 2024, compared to 26.1% in 2023, with the decrease primarily due to growth in net premiums earned.

The underwriting expense ratio for the reinsurance segment was 24.0% in 2025, compared to 23.5% in 2024.

The increase in the 2025 period primarily reflected lower profit and sliding scale commissions on ceded business.

Mortgage Segment

17 unchanged sentences

Combined ratio 14.6 % 12.6 % 2.0

(1) ‘Other underwriting income’ includes revenue earned from underwriting related activities covered under existing service contracts.

(2) The ‘Other operating expense ratio’ for the 2025 period includes ‘Other underwriting income.’ See ‘Comments on Non-GAAP Financial Measures’ for further details.

Net Premiums Written .

5 unchanged sentences

Total $ 1,060 $ 1,112

Net premiums written for 2024 were 5.7% higher than in 2023.

The increase in net premiums written in 2024 primarily reflected a lower level of premiums ceded to Bellemeade entities.

Net premiums written for 2025 were 4.7% lower than in 2024.

The reduction in net premiums written in the 2025 period primarily reflected lower gross premiums written and expenses related to tender offers of certain Bellemeade Re mortgage insurance linked notes.

The persistency rate of the U.S.

1 unchanged sentence

The persistency rate represents the percentage of mortgage insurance in force at the beginning of a 12 month period that remains in force at the end of such period.

ARCH CAPITAL 78

2025 FORM 10-K

The following tables provide details on the new insurance written (“NIW”) generated by U.S.

4 unchanged sentences

Total new insurance written (NIW) (1) $ 48,705 $ 48,479

Credit quality (FICO):

Credit quality:

>=740 $ 37,335 76.7 $ 34,023 70.2

23 unchanged sentences

Total $ 1,172 $ 1,231

Net premiums earned for 2024 were 6.3% higher than in 2023, reflecting changes in net premiums written over the previous five quarters.

ARCH CAPITAL 75

2024 FORM 10-K

Net premiums earned for 2025 were 4.8% lower than in 2024, reflecting changes in net premiums written over the previous five quarters.

Other Underwriting Income .

Other underwriting income, which is primarily related to GSE risk-sharing transactions services and our whole mortgage loan purchase and sell program, was $17 million for 2024, compared to $14 million for 2023.

Other underwriting income, which is primarily related to GSE risk-sharing transactions services, was $22 million for 2025, compared to $17 million for 2024.

Losses and Loss Adjustment Expenses .

12 unchanged sentences

Current Year Loss Ratio .

The mortgage segment’s current year loss ratio was 2.2 points lower in 2024 compared to 2023.

The lower current year loss ratio for 2024 reflected a lower average case reserve per default.

The mortgage segment’s current year loss ratio was 1.2 points higher in 2025 compared to 2024.

The higher current year loss ratio in 2025 period reflected slightly higher new delinquencies and the impact of the Bellemeade Re tender offers noted above.

The percentage of loans in default on U.S.

3 unchanged sentences

Our ultimate claims exposure will depend on the number of delinquency notices received and the ultimate claim rate related to such notices.

In the event of natural disasters, cure rates are influenced by the adequacy of homeowners and flood insurance carried on a related property, and a borrower's access to aid from

government entities and private organizations, in addition to other factors which generally impact cure rates in unaffected areas.

In the event of natural disasters, cure rates are influenced by the adequacy of homeowners and flood insurance carried on a related property, and a borrower's access to aid from government entities and private organizations, in addition to other factors which generally impact cure rates in unaffected areas.

ARCH CAPITAL 79

2025 FORM 10-K

Prior Period Reserve Development .

3 unchanged sentences

The underwriting expense ratio for the mortgage segment was 15.0% for 2025, compared to 17.0% for 2024.

The decrease was primarily due to a lower level of profit commissions on U.S.

primary business, along with a higher level of net premiums earned.

The corporate results include net investment income, net realized gains or losses, equity in net income or loss of investments accounted for using the equity method, other income (loss), corporate expenses, transaction costs and other, amortization of intangible assets, interest expense, net foreign exchange gains or losses, income taxes items (which for 2023 reflects the establishment of a net deferred income tax asset related to the enactment of Bermuda’s new corporate income tax), income from operating affiliates and items related to our non-cumulative preferred shares.

The decrease in the 2025 period primarily reflects a lower headcount as a result of the 2024 voluntary separation program.

The Company’s corporate results include net investment income, net realized gains or losses (which includes, but is not limited to, realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries), equity in net income or loss of investments accounted for using the equity method, other income or loss, corporate expenses, transaction costs and other, amortization of intangible assets, interest expense, net foreign exchange gains or losses, income taxes, income from operating affiliates and items related to our non-cumulative preferred shares.

Net Investment Income.

4 unchanged sentences

Short-term investments

Equity securities

Equity securities (dividends)

Gross investment income

2 unchanged sentences

$ 1,625 $ 1,495

(1) Includes interest income on operating cash, distributions from investment funds and other items.

(2) Investment expenses were approximately 0.26% of average invested assets for 2024, consistent with 0.26% for 2023.

ARCH CAPITAL 76

2024 FORM 10-K

(1) Amounts include dividends and other distributions on investment funds, term loan investments, funds held balances, cash balances and other items.

(2) Investment expenses were approximately 0.23% of average invested assets for 2025, compared to 0.26% for 2024.

The pre-tax investment income yield was 4.11% for 2025, compared to 4.25% for 2024.

The growth in net investment income for 2024 compared to 2023 primarily reflected higher yields available in the financial markets.

The pre-tax investment income yields were calculated based on amortized cost.

Net cash flow from operating activities contributed $6.2 billion in 2025, which increased our invested asset base and contributed to the growth in net investment income.

Net investment income in 2024 was partially impacted by a $1.9 billion special dividend paid to common shareholders in December which required us to sell certain investments.

Yields on future investment income may vary based on financial market conditions, investment allocation decisions and other factors.

Net Realized Gains or Losses.

We recorded net realized gains of $197 million for 2024, compared to net realized losses of $165 million for 2023.

We recorded net realized gains of $464 million for 2025, compared to net realized gains of $197 million for 2024.

Amounts in both periods reflected sales of investments as well as the impact of financial market movements on the Company’s equity securities and investments accounted for under the fair value option method.

Amounts in the 2025 period also include losses related to the impairment and sale of certain alternative investments accounted for under the equity method.

Currently, our portfolio is actively managed to maximize total return within certain guidelines.

7 unchanged sentences

See note 9, “Investment Information—Equity in Net Income (Loss) of Investments Accounted For Using the Equity Method,” to our consolidated financial statements in Item 8 for additional information.

ARCH CAPITAL 80

2025 FORM 10-K

Other Income or Losses

3 unchanged sentences

Corporate expenses were $57 million for 2025, compared to $119 million for 2024.

Such amounts primarily represent certain holding company costs necessary to support our worldwide operations and costs associated with operating as a publicly traded company.

Such expenses primarily represent certain holding company costs necessary to support our worldwide operations and costs associated with operating as a publicly traded company.

The 2025 period reflected Bermuda substance-based tax credits enacted in December 2025 with retroactive effect to January 1, 2025.

Transaction Costs and Other.

Transaction costs and other were $75 million for 2025, compared to $81 million for 2024.

The 2024 period primarily includes direct costs related to the MCE Acquisition and ongoing integration efforts.

The amounts for both the 2025 and 2024 periods primarily reflect direct costs related to the MCE Acquisition and ongoing integration efforts.

Amortization of Intangible Assets.

Amortization of intangible assets for 2025 was $193 million, compared to $235 million for 2024.

Amounts in 2024 and 2023 primarily related to amortization of finite-lived intangible assets with the increase in 2024 primarily related to the MCE Acquisition.

See note 2, “Acquisition.”

Amounts in both 2025 and 2024 primarily related to amortization of finite-lived intangible assets acquired as part of the MCE Acquisition.

Interest Expense .

2 unchanged sentences

Net Foreign Exchange Gains or Losses.

Net foreign exchange gains for 2024 were $75 million, compared to net foreign exchange losses for 2023 of $60 million.

Net foreign exchange losses for 2025 were $128 million, compared to net foreign exchange gains for 2024 of $75 million.

Amounts in such periods were primarily unrealized and resulted from the effects of revaluing our net insurance liabilities required to be settled in foreign currencies at each balance sheet date.

Income Tax Expense.

Our income tax provision on income before income taxes resulted in an expense of 7.7% for 2024, compared to a benefit of 24.5% for 2023.

The 2023 provision reflected the establishment of a net deferred income tax asset of $1.18 billion related to the enactment of Bermuda’s new corporate income tax.

Our income tax provision on income before income taxes resulted in an expense of 14.7% for 2025, compared to an expense of 7.7% for 2024.

Our effective tax rate fluctuates from year to year consistent with the relative mix of income or loss reported by jurisdiction and the varying tax rates in each jurisdiction.

See note 15, “Income Taxes,” to our consolidated financial statements in Item 8 for a reconciliation of the difference

ARCH CAPITAL 77

2024 FORM 10-K

between the provision for income taxes and the expected tax provision at the weighted average statutory tax rate for 2024 and 2023.

The increase in the 2025 period is primarily attributed to the enactment of the Corporate Income Tax Act 2023 by the Government of Bermuda, which established a 15% corporate income tax effective January 1, 2025.

note 15, “Income Taxes,” to our consolidated financial statements in Item 8.

Income (Loss) from Operating Affiliates.

15 unchanged sentences

See note 6, “Short Duration Contracts,” to our consolidated financial statements in Item 8 for additional information on our reserving process.

ARCH CAPITAL 81

2025 FORM 10-K

At December 31, 2025 and 2024, our Loss Reserves, net of unpaid losses and loss adjustment expenses recoverable, by type and by operating segment were as follows:

17 unchanged sentences

At December 31, 2025 and 2024, the insurance segment’s Loss Reserves by major line of business, net of unpaid losses and loss adjustment expenses recoverable, were as follows:

Multi-line and other specialty $ 4,105 $ 1,350

Third party occurrence business $ 4,610 $ 4,104

Multi-line and other specialty 4,345 4,105

Third party claims-made business 2,861 2,630

3 unchanged sentences

Casualty $ 3,823 $ 3,089

Other specialty 2,791 2,125

Specialty 3,658 2,791

Property excluding property catastrophe 2,107 1,778

3 unchanged sentences

Total net reserves $ 11,312 $ 9,107

ARCH CAPITAL 78

2024 FORM 10-K

At December 31, 2025 and 2024, the mortgage segment’s Loss Reserves by major line of business, net of unpaid losses and loss adjustment expenses recoverable, were as follows:

3 unchanged sentences

Total net reserves $ 441 $ 473

(1) At December 31, 2024, 35.0% of total net reserves represent policy years 2014 and prior and the remainder from later policy years.

At December 31, 2023, 31.0% of total net reserves represent policy years 2014 and prior and the remainder from later policy years.

Potential Variability in Loss Reserves

4 unchanged sentences

The results show the impact of varying each key actuarial assumption using the chosen sensitivity on our Loss Reserves, on a net basis and across all accident years.

ARCH CAPITAL 82

2025 FORM 10-K

INSURANCE SEGMENT Higher Expected Loss Ratios Slower Loss Development Patterns

Reserving lines selected assumptions:

Property, energy, marine and aviation 5 points

Multi-line and other specialty 10 points

Third party occurrence business 10 6

Third party claims-made business 10 6

Multi-line and other specialty 10 6

Increase (decrease) in Loss Reserves:

Property, energy, marine and aviation 5 3

Increase (decrease) in Loss Reserves:

Multi-line and other specialty $ 600 $ 370

Third party occurrence business 453 248

Third party claims-made business 244 275

Multi-line and other specialty 804 302

Property, energy, marine and aviation 61 129

INSURANCE SEGMENT Lower Expected Loss Ratios Faster Loss Development Patterns

Reserving lines selected assumptions:

Property, energy, marine and aviation (5) points

Multi-line and other specialty (10) points

Third party occurrence business (10) (6)

Third party claims-made business (10) (6)

Multi-line and other specialty (10) (6)

Increase (decrease) in Loss Reserves:

Property, energy, marine and aviation (5) (3)

Increase (decrease) in Loss Reserves:

Multi-line and other specialty $ (581) $ (296)

Third party occurrence business (451) (215)

Third party claims-made business (244) (216)

Multi-line and other specialty (709) (261)

Property, energy, marine and aviation (54) (108)

REINSURANCE SEGMENT Higher Expected Loss Ratios Slower Loss Development Patterns

1 unchanged sentence

Casualty 10 points

Other specialty 5 3

Specialty 5 3

Property excluding property catastrophe 5 3

3 unchanged sentences

Casualty $ 361 $ 378

Other specialty 245 172

Specialty 310 232

Property excluding property catastrophe 106 237

1 unchanged sentence

Marine and aviation 25 50

ARCH CAPITAL 79

2024 FORM 10-K

REINSURANCE SEGMENT Lower Expected Loss Ratios Faster Loss Development Patterns

1 unchanged sentence

Casualty (10) points

Other specialty (5) (3)

Specialty (5) (3)

Property excluding property catastrophe (5) (3)

4 unchanged sentences

Casualty $ (361) $ (270)

Other specialty (245) (240)

Specialty (311) (295)

Property excluding property catastrophe (106) (229)

7 unchanged sentences

For every one percentage point change in our primary net default to claim rate (which we estimate to be approximately 22% at December 31, 2025), we estimated a $20 million change in our loss reserves at December 31, 2025.

ARCH CAPITAL 83

2025 FORM 10-K

Simulation Results

16 unchanged sentences

It is difficult to provide meaningful trend information for certain liability/casualty coverages for which the claim-tail may be especially long, as claims are often reported and ultimately paid or settled years, or even decades, after the related loss events occur.

Any estimates and

ARCH CAPITAL 80

2024 FORM 10-K

assumptions made as part of the reserving process could prove to be inaccurate due to several factors, including the fact that for certain lines of business relatively limited historical information has been reported to us through December 31, 2024.

Any estimates

and assumptions made as part of the reserving process could prove to be inaccurate due to several factors, including the fact that for certain lines of business relatively limited historical information has been reported to us through December 31, 2025.

Accordingly, the reserving for incurred losses in these lines of business could be subject to greater variability.

1 unchanged sentence

Mortgage Operations Supplemental Information

On June 3, 2024, we completed the acquisition of RMIC Companies, Inc., and its wholly-owned subsidiaries (“RMIC”) that, together, comprise the run-off mortgage insurance business of Old Republic International Corporation.

The acquired business had been in runoff since 2011 and represented $3.6 billion of insurance in force at the time of the acquisition.

The mortgage segment’s insurance in force (“IIF”) and risk in force (“RIF”) were as follows at December 31, 2025 and 2024:

18 unchanged sentences

Such amounts are shown before external reinsurance.

ARCH CAPITAL 84

2025 FORM 10-K

The insurance in force and risk in force for our U.S.

31 unchanged sentences

(1) Represents the ending percentage of loans in default.

ARCH CAPITAL 81

2024 FORM 10-K

The following tables provide supplemental disclosures on risk in force for our U.S.

1 unchanged sentence

Amount % Amount %

Credit quality (FICO):

Credit quality:

>=740 $ 47,757 63.9 $ 47,360 62.3

3 unchanged sentences

Total $ 74,679 100.0 $ 76,034 100.0

Weighted average FICO score 748 748

Weighted average credit score 749 748

Loan-to-Value (LTV):

11 unchanged sentences

North Carolina 3,343 4.5 3,355 4.4

Georgia 3,143 4.1 3,081 4.1

Minnesota 3,129 4.2 3,108 4.1

Illinois 3,042 4.1 3,056 4.0

Massachusetts 2,885 3.8 2,858 3.8

Georgia 3,005 4.0 3,143 4.1

Michigan 2,816 3.8 2,855 3.8

Massachusetts 2,780 3.7 2,885 3.8

Florida 2,672 3.6 2,824 3.7

2 unchanged sentences

Total $ 74,679 100.0 $ 76,034 100.0

ARCH CAPITAL 85

2025 FORM 10-K

The following table provides supplemental disclosures for our U.S.

15 unchanged sentences

Average reserve per default (in thousands) (2) $ 15.3 $ 15.3

(1) Represents delinquent loans related to the acquisition of RMIC.

(1) Represents delinquent loans related to the acquisition of RMIC Companies, Inc.

(2) Includes first lien primary and pool policies.

(3) Represents total direct first lien paid claims divided by RIF of loans for which claims were paid, excluding paid claim settlements.

The risk-to-capital ratio, which represents total current (non-delinquent) risk in force, net of reinsurance, divided by total statutory capital, for U.S.

primary mortgage insurance operations was approximately 7.8 to 1 at December 31, 2024, compared to 7.3 to 1 at December 31, 2023.

The risk-to-capital ratio, which represents total current (non-delinquent) risk in force, net of reinsurance, divided by total statutory capital, for Arch MI U.S.

was approximately 8.2 to 1 at December 31, 2025, compared to 7.8 to 1 at December 31, 2024.

Ceded Reinsurance

4 unchanged sentences

Such arrangements reduce the effect of individual or aggregate losses to all companies participating on such treaties, including the reinsurers, such as our reinsurance operations, and the ceding company.

Estimating reinsurance recoverables can be more subjective than estimating the underlying reserves for losses and loss adjustment expenses as discussed above in “—Loss Reserves.” In particular, reinsurance recoverables may be

ARCH CAPITAL 82

2024 FORM 10-K

affected by deemed inuring reinsurance, industry losses reported by various statistical reporting services, and other factors.

Estimating reinsurance recoverables can be more subjective than estimating the

underlying reserves for losses and loss adjustment expenses as discussed above in “—Loss Reserves.” In particular, reinsurance recoverables may be affected by deemed inuring reinsurance, industry losses reported by various statistical reporting services, and other factors.

Reinsurance recoverables are recorded as assets, predicated on the reinsurers’ ability to meet their obligations under the reinsurance agreements.

13 unchanged sentences

See Item 1A, “Risk Factors—Risks Relating to Our Industry, Business and Operations—We are exposed to credit risk in certain of our business operations” and “Financial Condition, Liquidity and Capital Resources” for further details.

ARCH CAPITAL 86

2025 FORM 10-K

We have entered into various aggregate excess of loss reinsurance agreements with various special purpose reinsurance companies domiciled in Bermuda.

These are special purpose variable interest entities that are not

consolidated in our financial results because we do not have the unilateral power to direct those activities that are significant to its economic performance.

These are special purpose variable interest entities that are not consolidated in our financial results because we do not have the unilateral power to direct those activities that are significant to its economic performance.

See note 12, “Variable Interest Entities” to our consolidated financial statements in Item 8 for additional information.

12 unchanged sentences

Premiums on our excess of loss and pro rata reinsurance contracts are estimated when the business is underwritten.

For excess of loss contracts, premiums are recorded as written based on the terms of the contract.

For excess of loss contracts, premiums are recorded as written based on the terms of the

Estimates of premiums written under pro rata contracts are recorded in the period in which the underlying risks incept and are based on information provided by the brokers and the ceding companies.

For multi-year reinsurance treaties which are payable in annual installments, generally,

ARCH CAPITAL 83

2024 FORM 10-K

only the initial annual installment is included as premiums written at policy inception due to the ability of the reinsured to commute or cancel coverage during the term of the policy.

For multi-year reinsurance treaties which are payable in annual installments, generally, only the initial annual installment is included as premiums written at policy inception due to the ability of the reinsured to commute or cancel coverage during the term of the policy.

The remaining annual installments are included as premiums written at each successive anniversary date within the multi-year term.

5 unchanged sentences

Gross Amount Acquisition Expenses Net

Other specialty

$ 1,417 $ (359) $ 1,058

Property excluding property catastrophe

547 (177) 370

Property excluding property catastrophe

469 (136) 333

7 unchanged sentences

A significant portion of amounts included as premiums receivable, which represent estimated premiums written, net of commissions, are not currently due based on the terms of the underlying contracts.

Based on currently available information, we report premiums receivable net of an allowance for expected credit loss.

Based on currently

ARCH CAPITAL 87

2025 FORM 10-K

available information, we report premiums receivable net of an allowance for expected credit loss.

We monitor credit risk associated with premiums receivable through our ongoing review of amounts outstanding, aging of the receivable, historical data and counterparty financial strength measures.

3 unchanged sentences

Contracts which are written on a “risks attaching” basis cover claims which attach to the underlying insurance policies written during the terms of such contracts.

Premiums earned on such contracts usually extend beyond the original term of the reinsurance contract, typically resulting in recognition of premiums earned over a 24-month period.

Premiums earned on such contracts usually extend beyond the original term of the reinsurance contract, typically resulting in recognition of premiums earned in proportion to the period of risk coverage.

Certain of our reinsurance contracts include provisions that adjust premiums or acquisition expenses based upon the experience under the contracts.

8 unchanged sentences

Premiums written on an annual basis are amortized on a monthly pro rata basis over the year of coverage.

Primary mortgage insurance premiums written on policies covering more than one year are referred to as single premiums.

Primary mortgage

insurance premiums written on policies covering more than one year are referred to as single premiums.

A portion of the revenue from single premiums is recognized in premiums earned in the current period, and the remaining portion is deferred as unearned premiums and earned over the estimated expiration of risk of the policy.

If single premium policies related to insured loans are canceled for any reason and the policy is a non-refundable product, the remaining unearned

ARCH CAPITAL 84

2024 FORM 10-K

premium related to each canceled policy is recognized as earned premium upon notification of the cancellation.

If single premium policies related to insured loans are canceled for any reason and the policy is a non-refundable product, the remaining unearned premium related to each canceled policy is recognized as earned premium upon notification of the cancellation.

Unearned premiums represent the portion of premiums written that is applicable to the estimated unexpired risk of insured loans.

11 unchanged sentences

Deferred acquisition costs are carried at their estimated realizable value and take into account anticipated losses and loss adjustment expenses, based on historical and current experience, and anticipated investment income.

ARCH CAPITAL 88

2025 FORM 10-K

A premium deficiency occurs if the sum of anticipated losses and loss adjustment expenses, unamortized acquisition costs and maintenance costs and anticipated investment income exceed unearned premiums.

7 unchanged sentences

Net Deferred Income Tax Assets Measurement

On December 27, 2023 the Bermuda government enacted tax legislation referred to as the Corporate Income Tax Act 2023 (“Bermuda CIT Act”).

The Bermuda CIT Act establishes a 15% corporate income tax, for in-scope businesses, for fiscal years beginning on or after January 1, 2025.

The enacted legislation includes a provision referred to as the Economic Transition Adjustment, which requires Bermuda Constituent entities to establish tax basis in their assets and liabilities, excluding goodwill, based on fair value as of September 30, 2023.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Using fair value to establish tax basis in the assets and liabilities of our Bermuda entities results in deductible and taxable temporary differences which are reflected as deferred income tax assets and liabilities, respectively, in our financial statements.

The enactment of Bermuda CIT Act resulted in the establishment of a $1.18 billion net deferred income tax asset.

Such amount is included in ‘other assets’ on the Company’s balance sheet.

In January 2025, the OECD issued administrative guidance introducing a new interpretation (with retroactive effect) for determining the treatment of deferred income tax assets and liabilities.

Bermuda has not issued corresponding guidance.

As of December 31, 2024, management’s estimate of the measurement of the deferred tax assets remains unchanged.

The most significant deferred income tax assets recognized relate to the fair value adjustments for identifiable intangible assets.

We estimated the fair value of the identifiable intangible assets of our Bermuda entities using discounted cash flow (“DCF”) models.

The significant assumptions

ARCH CAPITAL 85

2024 FORM 10-K

utilized in the DCF models included the future revenue and profits expected to be generated by the identifiable intangible assets and the discount rates.

Deferred income tax assets and liabilities reflect temporary differences based on enacted tax rates between the carrying amounts of assets and liabilities for financial reporting and income tax purposes.

We determine deferred tax assets and liabilities separately for each tax-paying component (an individual entity or group of entities that is consolidated for tax purposes) in each tax jurisdiction.

There may be changes in tax laws where we transact business that impact our deferred tax assets and liabilities.

The most significant deferred income tax assets recognized relate to goodwill and intangible assets.

With respect to our Bermuda entities, we estimated the fair value of its intangible assets using discounted cash flow (“DCF”) models.

The significant assumptions utilized in the DCF models included the future revenue and profits expected to be generated by the identifiable intangible assets and the discount rates.

See note 15, “Income Taxes” to our consolidated financial statements in Item 8 for disclosures concerning our Company’s deferred income tax asset.

6 unchanged sentences

Significant Accounting Pronouncements

For all other significant accounting policies see note 3, “Significant Accounting Policies” and note 3(t), “Recent Accounting Pronouncements” to our consolidated financial statements in Item 8 for disclosures concerning our companies significant accounting policies and recent accounting pronouncements.

For all other significant accounting policies see note 3, “Significant Accounting Policies” and note 3(u), “Recent Accounting Pronouncements” to our consolidated financial statements in Item 8 for disclosures concerning our companies significant accounting policies and recent accounting pronouncements.

FINANCIAL CONDITION

7 unchanged sentences

Our Chief Investment Officer administers the investment portfolio, oversees our investment managers and formulates investment strategy in conjunction with the FIR Committee.

At December 31, 2024, approximately $25.6 billion, or 62%, of

total investable assets held by Arch were internally managed, compared to $21.9 billion, or 63%, at December 31, 2023.

At December 31, 2025, approximately $29.5 billion, or 62%, of total investable assets held by Arch were internally managed, compared to $25.6 billion, or 62%, at December 31, 2024.

ARCH CAPITAL 89

2025 FORM 10-K

The following table summarizes the duration and average credit quality of fixed income assets held by Arch:

Average effective fixed maturities duration

(in years) 3.31 3.51

Average effective fixed maturities duration (in years) 3.34 3.31

Average S&P/Moody’s credit ratings (1) AA-/Aa3 AA-/Aa3

(1) Average credit ratings on our investment portfolio on securities with ratings by Standard & Poor’s Rating Services (“S&P”) and Moody’s Investors Service (“Moody’s”).

(1) Average credit ratings on our investment portfolio on securities with ratings by S&P and Moody’s.

The following table provides the credit quality distribution of our fixed maturities.

18 unchanged sentences

government-sponsored agency residential mortgage backed securities and agency commercial mortgage backed securities.

ARCH CAPITAL 86

2024 FORM 10-K

The following table provides information on the severity of the unrealized loss position as a percentage of amortized cost for all fixed maturities which were in an unrealized loss position:

15 unchanged sentences

Estimated Fair Value Credit

JPMorgan Chase & Co.

Morgan Stanley $ 449 A/A1

JPMorgan Chase & Co.

Bank of America Corporation 342 A-/A1

The Goldman Sachs Group, Inc.

Blue Owl Capital Inc.

242 BBB-/Baa3

Wells Fargo & Company 263 BBB+/A1

Citigroup Inc.

Blackstone Inc.

188 BBB-/Baa2

Hyundai Motor Company 186 A-/A3

The Toronto-Dominion Bank 191 A-/A2

UBS Group AG 179 A-/A2

Philip Morris International Inc.

Ford Motor Company 140 BBB-/Ba1

Canada 156 AA-/Aa2

Total $ 2,675

(1) Average credit ratings as assigned by S&P and Moody’s, respectively.

ARCH CAPITAL 90

2025 FORM 10-K

The following table provides information on our structured securities, which include residential mortgage-backed securities (“RMBS”), commercial mortgage-backed securities (“CMBS”) and asset backed securities (“ABS”):

14 unchanged sentences

Total $ 1,869 $ 1,682

(1) Primarily in technology, consumer non-cyclical, communications, financial and industrials at December 31, 2024.

(2) Primarily in corporate at December 31, 2024.

(3) Primarily in financials, consumer staples, industrials and energy sectors at December 31, 2024.

(1) Primarily in technology, communications, consumer non-cyclical, financial and industrials at December 31, 2025.

(2) Primarily in structured and corporates at December 31, 2025.

(3) Primarily in technology, financials, communications, consumer cyclical and healthcare sectors at December 31, 2025.

Our investment strategy allows for the use of derivative instruments.

3 unchanged sentences

See note 10, “Fair Value,” to our consolidated financial statements in Item 8 for a summary of our financial assets and liabilities measured at fair value at December 31, 2025 and 2024 segregated by level in the fair value hierarchy.

ARCH CAPITAL 87

2024 FORM 10-K

Reinsurance Recoverables

2 unchanged sentences

Somers Re Ltd.

Hannover Rück SE

Lloyd’s syndicates (3)

Munich Reinsurance America, Inc.

Hannover Rück SE

Munich Re Group

RenaissanceRe Holdings Ltd.

Swiss Reinsurance America Corporation

Everest Reinsurance Company

Partner Reinsurance Company of the U.S.

Swiss Reinsurance Company Ltd.

Everest Group Ltd.

Allianz 1.5 A+

AXIS Capital Holdings Limited 1.5 A

Transatlantic Reinsurance Company 1.4 A++

Fortitude Reinsurance Company Ltd.

All other -- “A-” or better

15 unchanged sentences

See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Summary of Critical Accounting Estimates—Loss Reserves” and see Item 1, “ Business—Reserves ” for further details.

ARCH CAPITAL 91

2025 FORM 10-K

Shareholders’ Equity and Book Value per Share

6 unchanged sentences

Book value per share $ 65.11 $ 53.11

(1) Excludes the effects of 12.4 million and 12.5 million stock options and 0.3 million and 0.4 million restricted stock and performance units outstanding at December 31, 2024 and 2023, respectively.

(1) Excludes the effects of 10.2 million and 12.4 million stock options and 0.3 million and 0.3 million restricted and performance share units outstanding at December 31, 2025 and 2024, respectively.

Liquidity is a measure of our ability to access sufficient cash flows to meet the short-term and long-term cash requirements of our business operations.

9 unchanged sentences

However, due to the nature of our operations, cash flows are affected by claim payments that

ARCH CAPITAL 88

2024 FORM 10-K

may comprise large payments on a limited number of claims and which can fluctuate from year to year.

15 unchanged sentences

The ability of our regulated insurance subsidiaries to pay dividends or make distributions is dependent on their ability to meet applicable regulatory

ARCH CAPITAL 92

2025 FORM 10-K

These regulations include restrictions that limit the amount of dividends or other distributions, such as loans or cash advances, available to shareholders without prior approval of the insurance regulatory authorities.

12 unchanged sentences

If we require significant amounts of cash on short notice in excess of anticipated cash requirements, then we may have difficulty selling these investments in a timely manner or may be forced to sell or terminate them at unfavorable values.

Our unfunded investment commitments totaled approximately $4.4 billion at December 31, 2024 and are callable by our investment managers.

The timing of the

ARCH CAPITAL 89

2024 FORM 10-K

funding of investment commitments is uncertain and may require us to access cash on short notice.

Our unfunded investment commitments totaled approximately $3.7 billion at December 31, 2025 and

are callable by our investment managers.

The timing of the funding of investment commitments is uncertain and may require us to access cash on short notice.

The following table summarizes our cash flows from operating, investing and financing activities:

6 unchanged sentences

Increase (decrease) in cash $ 307 $ 262

Cash provided by operating activities in 2024 was higher than in 2023.

Activity in 2024 primarily reflected a higher level of premiums collected than in 2023.

Cash used for investing activities in 2024 reflected lower net purchases than in 2023.

Cash used for investing activity during 2024 was partially impacted by a $1.9 billion special dividend paid to common shareholders, which entailed that we liquidate certain investments.

Cash provided by operating activities in 2025 was lower than in 2024.

Activity in the 2025 period primarily reflected a higher level of losses paid than in the 2024 period.

Cash used for investing activities in 2025 reflected lower net purchases than in 2024, due in part to a higher level of losses paid than in the 2024 period.

Activity in 2024 also reflected $852 million of net cash received related to the MCE Acquisition.

Cash used for financing activities in 2024 was higher than in 2023.

Activity in 2024 included a $1.9 billion special dividend paid to common shareholders.

Cash used for financing activities in 2025 was lower than in 2024.

Activity in 2025 consisted of $1.9 billion of share repurchases under our share repurchase program, while activity in 2024 included a $1.9 billion special dividend paid to common shareholders.

ARCH CAPITAL 93

2025 FORM 10-K

At December 31, 2025, our investable assets were $47.4 billion.

28 unchanged sentences

state insurance regulations.

ARCH CAPITAL 90

2024 FORM 10-K

In addition, Arch Mortgage Insurance Company and United Guaranty Residential Insurance Company (together, “eligible mortgage insurer”) are required to maintain compliance with the GSE requirements, known as PMIERs.

3 unchanged sentences

On August 21, 2024, Fannie Mae and Freddie Mac (collectively the GSEs) each updated their PMIERs to incorporate new deductions to available assets for investment risk.

This update will become effective March 31, 2025, but the impact will be phased in through September 30, 2026.

If the GSEs had fully implemented this update to PMIERs as of December 31, 2024, the changes would have reduced available assets by 17% and resulted in a Pro-forma PMIERs Sufficiency Ratio of 154% compared with a reported PMIERs Sufficiency Ratio of 186%.

This update became effective on March 31, 2025, but the impact will be phased in through September 30, 2026.

If the GSEs had fully implemented this update to PMIERs as of December 31, 2025, the changes would have reduced the available assets by 6% and resulted in a pro-forma PMIERs sufficiency ratio of 173%.

As part of our capital management program, we may seek to raise additional capital or may seek to return capital to our shareholders through share repurchases, cash dividends or other methods (or a combination of such methods).

Any such determination will be at the discretion of the Board and will be dependent upon our profits, financial requirements and other factors, including legal restrictions, rating agency requirements and such other factors as our Board deems relevant.

We may also seek to retire or purchase our outstanding debt through cash purchases and/or exchanges for equity or debt, in open-market purchases, privately negotiated transactions or

ARCH CAPITAL 94

2025 FORM 10-K

Any such determination will be at the discretion of the Board and will be dependent upon our profits, financial requirements and other factors, including legal restrictions, rating agency requirements, prevailing market conditions and such other factors as our Board deems relevant.

The amounts involved may be material.

To the extent that our existing capital is insufficient to fund our future operating requirements or maintain such ratings, we may need to raise additional funds through financings or limit our growth.

2 unchanged sentences

In addition to common share capital, we depend on external sources of finance to support our underwriting activities, which can be in the form (or any combination) of debt securities, preference shares, common equity and bank credit facilities providing loans and/or letters of credit.

Arch Capital, through its subsidiaries, provides financial support to certain of its insurance subsidiaries and affiliates,

through certain reinsurance arrangements beneficial to the ratings of such subsidiaries.

Arch Capital, through its subsidiaries, provides financial support to certain of its insurance subsidiaries and affiliates, through certain reinsurance arrangements beneficial to the ratings of such subsidiaries.

Historically, our insurance, reinsurance and mortgage insurance subsidiaries have entered into separate reinsurance arrangements with Arch Re Bermuda covering individual lines of business.

4 unchanged sentences

Since the inception of the share repurchase program through December 31, 2025, Arch Capital has repurchased approximately 455.0 million common shares for an aggregate purchase price of $7.8 billion.

At December 31, 2024, $996.8 million of share repurchases were available under the program.

At December 31, 2025, $1.1 billion of share repurchases were available under the program.

Repurchases under the program may be effected from time to time in open market.

The timing and amount of the repurchase transactions under this program will depend on a variety of factors, including market conditions, the development of the economy, corporate and regulatory considerations.

The timing and

amount of the repurchase transactions under this program will depend on a variety of factors, including market conditions, the development of the economy, corporate and regulatory considerations.

We will continue to monitor our share price and, depending upon results of operations, market conditions and the development of the economy, as well as other factors, we will consider share repurchases on an opportunistic basis.

12 unchanged sentences

Our senior notes were issued by Arch Capital, Arch Capital Group (U.S.) Inc.

(“Arch-U.S.”) and Arch Capital Finance

ARCH CAPITAL 91

2024 FORM 10-K

LLC (“Arch Finance”).

(“Arch-U.S.”) and Arch Capital Finance LLC (“Arch Finance”).

is a wholly-owned subsidiary of Arch Capital and Arch Finance is a wholly-owned finance subsidiary of Arch-U.S.

13 unchanged sentences

and Arch Finance, respectively.

ARCH CAPITAL 95

2025 FORM 10-K

During 2025 and 2024, we made interest payments of $127 million and $127 million, respectively, primarily related to our senior notes and other financing arrangements.

4 unchanged sentences

December 31, 2025 December 31, 2024

Arch Capital Arch-U.S.

Arch Capital Arch-

Total investments $ 40 $ 442 $ 43 $ 549

1 unchanged sentence

Investment in operating affiliates 3 — 3 —

Due from subsidiaries and affiliates 6 10 — —

Due from subsidiaries

and affiliates 16 14 6 10

Other assets 194 129 66 101

1 unchanged sentence

Senior notes 1,288 496 1,287 495

Due to subsidiaries and affiliates 11 994 — 993

Due to subsidiaries

and affiliates 6 993 11 994

Other liabilities 41 58 48 50

2 unchanged sentences

December 31, 2025 December 31, 2024

Arch Capital Arch-U.S.

Arch Capital Arch-

Arch Capital Arch-U.S.

9 unchanged sentences

Income tax (expense) benefit 58 9 — 22

Income (loss) from operating affiliates (1) — (1) —

Income (loss) from

operating affiliates (1) — (1) —

Net income available to Arch (66) (59) (175) (54)

Preferred dividends (40) — (40) —

Net income available to Arch common shareholders $ (215) $ (54) $ (150) $ (65)

Net income available to

Arch common shareholders $ (106) $ (59) $ (215) $ (54)

ARCH CAPITAL 96

39 unchanged sentences

Best Company and Fitch Ratings are ratings agencies which have assigned financial strength ratings to one or more of Arch Capital’s subsidiaries.

If we are not able to obtain adequate capital, our business, results of operations and financial condition could be adversely affected, which could include, among other things, the following possible outcomes:

(1) potential downgrades in the financial strength ratings assigned by ratings agencies

ARCH CAPITAL 97

2025 FORM 10-K

(1) potential downgrades in the financial strength ratings assigned by ratings agencies to our operating subsidiaries, which could place those operating subsidiaries at a competitive disadvantage compared to higher-rated competitors;

to our operating subsidiaries, which could place those operating subsidiaries at a competitive disadvantage compared to higher-rated competitors;

(2) reductions in the amount of business that our operating subsidiaries are able to write in order to meet capital adequacy-based tests enforced by statutory agencies;

3 unchanged sentences

Our website www.archgroup.com (Investor Relations-Credit Ratings) contains information about our ratings, but such information on our website is not incorporated by reference into this report.

CATASTROPHIC EVENTS AND SEVERE ECONOMIC EVENTS

We have large aggregate exposures to natural and man-made catastrophic events, pandemic events like COVID-19 and severe economic events.

CATASTROPHIC AND SEVERE ECONOMIC EVENTS

We have large aggregate exposures to natural and man-made catastrophic events, pandemic events and severe economic events.

Natural catastrophes can be caused by various events, including hurricanes, floods, windstorms, earthquakes, hailstorms, tornadoes, explosions, severe winter weather, fires, droughts and other natural disasters.

Man-made catastrophic events may include acts of war, acts of terrorism and political instability.

Catastrophes can also cause losses in non-property business such as mortgage insurance, workers’ compensation or general liability.

3 unchanged sentences

It is difficult to predict the timing of such events with statistical certainty or estimate the amount of loss any given occurrence will generate.

It is not possible to completely eliminate our exposure to unforecasted or unpredictable events and, to the extent that

losses from such risks occur, our financial condition and results of operations could be materially adversely affected.

It is not possible to completely eliminate our exposure to unpredictable events and, to the extent that losses from such risks occur, our financial condition and results of operations could be materially adversely affected.

Therefore, claims for natural and man-made catastrophic events could expose us to large losses and cause substantial volatility in our results of operations, which could cause the value of our common shares to fluctuate widely.

12 unchanged sentences

One or more catastrophic or other events could result in claims that substantially exceed our expectations, which could have a material adverse effect on our financial condition or our results of operations, possibly to the extent of eliminating our shareholders' equity.

ARCH CAPITAL 98

2025 FORM 10-K

For our natural catastrophe exposed business, we seek to limit the amount of exposure we will assume from any one insured or reinsured and the amount of the exposure to catastrophe losses from a single event in any geographic zone.

1 unchanged sentence

Our estimated probable maximum pre-tax loss is determined through the use of modeling techniques, but such estimate does not represent our total potential loss for such exposures.

ARCH CAPITAL 94

2024 FORM 10-K

Our models employ both proprietary and vendor-based systems and include cross-line correlations for property, marine, offshore energy, aviation, workers compensation and personal accident.

2 unchanged sentences

We reserve the right to change this threshold at any time.

Based on in-force exposure estimated as of January 1, 2025, our modeled peak zone catastrophe exposure is a windstorm affecting the Florida Tri-County, with a net probable maximum pre-tax loss of $1.8 billion, followed by windstorms affecting the Northeast U.S., and the Gulf of Mexico with net probable maximum pre-tax losses of $1.7 billion and $1.5 billion, respectively.

Based on in-force exposure estimated as of January 1, 2026, our modeled peak zone catastrophe exposure was a windstorm affecting the Florida Tri-County, with a net probable maximum pre-tax loss of $1.9 billion, followed by windstorms affecting the Northeast U.S., and the Gulf of Mexico with net probable maximum pre-tax losses of $1.7 billion and $1.5 billion, respectively.

As of January 1, 2026, our modeled peak zone earthquake exposure (San Francisco area earthquake) represented approximately 51% of our peak zone catastrophe exposure, and our modeled peak zone international exposure (German windstorm) was substantially less than both our peak zone windstorm and earthquake exposures.

We also have significant exposure to losses due to mortgage defaults resulting from severe economic events in the future.

mortgage insurance business, we have developed a proprietary risk model (“Realistic Disaster Scenario” or “RDS”) that simulates the maximum loss resulting from a severe economic downturn impacting the housing market.

and Australian mortgage insurance business, we have developed a proprietary risk model (“Realistic Disaster Scenario” or “RDS”) that simulates the maximum loss resulting from a severe economic downturn impacting the housing market.

The RDS models the collective impact of adverse conditions for key economic indicators, the most significant of which is a decline in home prices.

1 unchanged sentence

The resulting future performance of our in-force portfolio is then estimated under the economic stress scenario, reflecting loan and borrower information.

Currently, we seek to limit our modeled RDS loss from a severe economic event to approximately 25% of total tangible shareholders’ equity available to Arch.

Currently, we seek to limit our modeled RDS loss from a severe economic event to approximately 25% of tangible shareholders’ equity available to Arch.

We reserve the right to change this threshold at any time.

Based on in-force exposure estimated as of January 1, 2025, our modeled RDS loss was 4.8% of tangible shareholders’ equity available to Arch.

Based on in-force exposure estimated as of January 1, 2026, our modeled RDS loss was $931 million, or 4.1% of tangible shareholders’ equity available to Arch.

Net probable maximum loss estimates are net of expected reinsurance recoveries, before income tax and before excess reinsurance reinstatement premiums.

1 unchanged sentence

Catastrophe loss estimates are reflective of the zone indicated and not the entire portfolio.

Since hurricanes and windstorms

can affect more than one zone and make multiple landfalls, our catastrophe loss estimates include clash estimates from other zones.

Since hurricanes and windstorms can affect more than one zone and make multiple landfalls, our catastrophe loss estimates include clash estimates from other zones.

Our catastrophe loss estimates and RDS loss estimates do not represent our maximum exposures and it is highly likely that our actual incurred losses would vary materially from the modeled estimates.

There can be no assurances that we will not suffer pre-tax losses greater than 25% of our tangible shareholders’ equity from one or more catastrophic events or severe economic events due to several factors, including the inherent uncertainties in estimating the frequency and severity of such events and the margin of error in making such determinations resulting from potential inaccuracies and inadequacies in the data provided by clients and brokers, the modeling techniques and the application of such techniques or as a result of a decision to change the percentage of shareholders' equity exposed to a single catastrophic event or severe economic event.

These factors include the inherent uncertainties in estimating the frequency and severity of such events and the margin of error in making such determinations resulting from potential inaccuracies and inadequacies in the data provided by clients and brokers, the modeling techniques and the application of such techniques or as a result of a decision to change the percentage of shareholders' equity exposed to a single catastrophic event or severe economic event.

In addition, actual losses may increase if our reinsurers fail to meet their obligations to us or the reinsurance protections purchased by us are exhausted or are otherwise unavailable.

1 unchanged sentence

See “—Summary of Critical Accounting Estimates—Ceded Reinsurance” for a discussion of our catastrophe reinsurance programs.

ARCH CAPITAL 99

2025 FORM 10-K

MARKET SENSITIVE INSTRUMENTS AND RISK MANAGEMENT

5 unchanged sentences

The sensitivity analysis performed as of December 31, 2025 presents hypothetical losses in cash flows, earnings and fair values of market sensitive instruments which were held by us on December 31, 2025 and are sensitive to changes in interest rates and equity security prices.

This risk management

ARCH CAPITAL 95

2024 FORM 10-K

discussion and the estimated amounts generated from the following sensitivity analysis represent forward-looking statements of market risk assuming certain adverse market conditions occur.

This risk management discussion and the estimated amounts generated from the following sensitivity analysis represent forward-looking statements of market risk assuming certain adverse market conditions occur.

Actual results in the future may differ materially from these projected results due to actual developments in the global financial markets.

7 unchanged sentences

We consider the effect of interest rate movements on the fair value of our fixed maturities, short-term investments and certain of our other investments, equity securities and investment funds accounted for using the equity method which invest in fixed income securities (collectively, “Fixed Income Securities”) and the corresponding change in unrealized appreciation.

As interest rates rise, the fair value of our Fixed Income Securities falls, and the converse is also true.

As interest rates rise, the fair value of our Fixed Income

Securities falls, and the converse is also true.

Based on historical observations, there is a low probability that all interest rate yield curves would shift in the same direction at the same time.

21 unchanged sentences

Change in unrealized value $ 1.1 $ 0.5 $ (0.5) $ (1.1)

ARCH CAPITAL 100

2025 FORM 10-K

Another method that attempts to measure portfolio risk is Value-at-Risk (“VaR”).

8 unchanged sentences

These investments are exposed to price risk, which is the potential loss arising from decreases in fair value.

An immediate hypothetical 10% decline in the value of each position would reduce the fair value of such investments by approximately $149 million and $101 million at

ARCH CAPITAL 96

2024 FORM 10-K

December 31, 2024 and 2023, respectively, and would have decreased book value per share by approximately $0.40 and $0.27, respectively.

An immediate hypothetical 10% decline in the value of each position would reduce the fair value of such investments by approximately $178 million and $149 million at December 31, 2025 and 2024, respectively, and would have decreased book value per share by approximately $0.50 and $0.40, respectively.

An immediate hypothetical 10% increase in the value of each position would increase the fair value of such investments by approximately $178 million and $149 million at December 31, 2025 and 2024, respectively, and would have increased book value per share by approximately $0.50 and $0.40, respectively.

2 unchanged sentences

If the underlying exposure of each investment-related derivative held at December 31, 2025 depreciated by 100 basis points, it would have resulted in a reduction in net income of approximately $80 million, and a decrease in book value per share of $0.22, compared to $50 million and $0.13, respectively, on investment-related derivatives held at December 31, 2024.

If the underlying exposure of each investment-related derivative held at December 31, 2024 appreciated by 100 basis points, it would have resulted in an increase in net income of approximately $50 million, and an increase in book value per share of $0.13, compared to $42 million and $0.11, respectively, on investment-related derivatives held at December 31, 2023.

If the underlying exposure of each investment-related derivative held at December 31, 2025 appreciated by 100 basis points, it would have resulted in an increase in net income of approximately $80 million, and an increase in book value per share of $0.22, compared to $50 million and $0.13, respectively, on investment-related

derivatives held at December 31, 2024.

See note 11, “Derivative Instruments,” to our consolidated financial statements in Item 8 for additional disclosures concerning derivatives.

For further discussion on investment activity, please refer to “—Financial Condition, Liquidity and Capital Resources—Financial Condition—Investable Assets.”

For further discussion on investment activity, please refer to “Financial Condition—Investable Assets.”

Foreign Currency Exchange Risk

22 unchanged sentences

(2) Represents the net notional value of outstanding foreign currency forward contracts.

ARCH CAPITAL 101

2025 FORM 10-K

Although the Company generally attempts to match the currency of its projected liabilities with investments in the same currencies, from time to time the Company may elect to over or underweight one or more currencies, which could increase the Company’s exposure to foreign currency fluctuations and increase the volatility of the Company’s shareholders’ equity.

2 unchanged sentences

For further discussion on foreign exchange activity, please refer to “—Results of Operations.”

ARCH CAPITAL 97

2024 FORM 10-K

Effects of Inflation

General economic inflation may continue to remain at elevated levels for an extended period of time.

The potential also exists, after a catastrophe loss or pandemic events like COVID-19, for the development of inflationary pressures in a local economy.

General economic inflation has increased in recent quarters and may continue to remain at elevated levels for an extended period of time.

The potential also exists, after a catastrophe loss or pandemic events, for the development of inflationary pressures in a local economy.

This risk may be heightened from time to time by geopolitical tensions, global supply chain disruptions, tariffs, and other contributing factors.

This may have a material effect on the adequacy of our reserves for losses and loss adjustment expenses, especially in longer-tailed lines of business, and on the market value of our investment portfolio through rising interest rates.

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis