What changed in this filing

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Item 1. Business

2026-03-03 compared with 2025-03-04 · 219 added, 302 removed, 521 unchanged (50% of the section changed)

James River Group Holdings, Ltd.

is a Bermuda-based holding company.

We own and operate a group of specialty insurance companies focused on underwriting small and middle market casualty risks within the U.S.

James River Group Holdings, Inc.

owns and operates a group of specialty property and casualty insurance companies focused on underwriting small and middle market casualty risks within the U.S.

excess and surplus (“E&S”) lines market.

For the year ended December 31, 2024, approximately 76.2% of our gross written premiums and 88.7% of our net written premiums from continuing operations originated from the E&S lines market, which we believe puts us among the top three publicly traded insurers as ranked by highest concentrations of E&S risk.

Substantially all of our business is casualty insurance, and for the year ended December 31, 2024, 96.3% of our gross written premiums from continuing operations were derived from casualty insurance.

Our objective is to generate compelling returns on tangible equity, while limiting underwriting and investment volatility.

We seek to accomplish this by earning profits from insurance underwriting and generating meaningful risk-adjusted investment returns, while managing our capital.

We write very little property or catastrophe insurance and no property catastrophe reinsurance.

For the year ended December 31, 2024, property insurance represented 3.7% of our gross written premiums from continuing operations.

For the year ended December 31, 2025, approximately 84.5% of our gross written premiums and 95.9% of our net written premiums originated from the E&S lines market, which we believe puts us among the top publicly traded insurers as ranked by highest concentrations of E&S risk.

Substantially all of our business is casualty insurance, and for the year ended December 31, 2025, 96.7% of our gross written premiums were derived from casualty insurance.

Our objective is to generate compelling returns on tangible common equity, while limiting underwriting and investment volatility.

We seek to accomplish this by earning profits from insurance underwriting and generating meaningful risk-adjusted investment returns, while efficiently managing our capital.

The Company limits its exposure to property catastrophe events to modest levels.

For the year ended December 31, 2025, property insurance represented 3.3% of our gross written premiums.

When we do write property insurance, we buy reinsurance to significantly mitigate our risk.

We have structured our reinsurance arrangements so that our modeled net pre-tax loss from a 1/1000 year probable maximum loss ("PML") event would not exceed 2.5% of shareholders’ equity on a group-wide basis, inclusive of reinstatement premiums payable and net retentions.

We have little exposure to and do not expect to be materially impacted by recent disasters including the wildfires in California or hurricanes Helene and Milton.

During 2024, we completed several strategic actions including closing the sale of JRG Reinsurance Company Ltd.

During the last two years, the Company has completed several strategic actions to strengthen our balance sheet and position us for long-term stability and profitable growth.

In 2025, the Company concluded its leadership reorganization with new appointments on our board and across several key management positions including appointing new Presidents at both of our operating segments.

We also undertook initiatives to reduce operating expenses and continued our focus on underwriting discipline and enterprise risk management.

On November 7, 2025, the Company completed the Domestication of our holding company, changing the Company's incorporation from Bermuda to the U.S.

The Company recognized a one-time benefit of $14.1 million related to business interest expense effective with the Domestication.

The Domestication is also expected to lower the Company’s effective tax rate, as holding company expenses and interest expense (previously incurred in Bermuda and ineligible for U.S.

tax deduction) will receive a U.S.

tax deduction in future periods, as well as bring additional operating efficiencies.

Strategic actions completed in 2024 included closing the sale of JRG Reinsurance Company Ltd.

(“JRG Re”) to focus our business around our U.S.

insurance businesses, entering a $160.0 million combined loss portfolio transfer and adverse development cover for our Excess and Surplus Lines business, and initiating a new strategic partnership with Enstar Group Limited (“Enstar”) which, in part, entailed a $12.5 million equity investment in the Company and an additional $75.0 million adverse development cover for the Excess and Surplus Lines business.

We believe these actions strengthen our balance sheet and position us to generate attractive returns in the future.

Following the sale of JRG Re, our continuing operations are comprised of two operating segments, Excess and Surplus Lines and Specialty Admitted Insurance, and a third segment, Corporate and Other.

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state and the District of Columbia through James River Insurance Company (“James River Insurance”) and its wholly-owned subsidiary, James River Casualty Company (“James River Casualty”).

The Excess and Surplus Lines segment produced 71.0% of our gross written premiums and 87.5% of our net written premiums from continuing operations for the year ended December 31, 2024.

The Excess and Surplus Lines segment produced 82.1% of our gross written premiums and 95.7% of our net written premiums for the year ended December 31, 2025.

James River Insurance and James River Casualty are both non-admitted carriers.

Non-admitted carriers writing in the E&S market are not bound by most of the rate and form regulations imposed on standard market companies, allowing them flexibility to change the coverage terms offered and the rate charged without the time constraints and financial costs and delays associated with the filing of such changes with state regulators and seeking approval for the filings.

In 2024, the average account in this segment (excluding commercial auto policies) generated annual gross written premiums of approximately $26,800.

The Excess and Surplus Lines segment distributes primarily through wholesale insurance brokers.

Members of our management team have participated in this market for over three decades and have long-standing relationships with the wholesale brokers who place E&S lines accounts.

In 2025, the average account in this segment (excluding commercial auto policies) generated annual gross written premiums of approximately $26,500, down 8.4% from the prior year.

The Excess and Surplus Lines segment distributes primarily through wholesale insurance brokers and is focused on small and medium enterprise business, which we believe have been historically more profitable than other segments of the market.

The Specialty Admitted Insurance segment has admitted licenses and the authority to write excess and surplus lines insurance in 50 states and the District of Columbia through Falls Lake National Insurance Company (“Falls Lake National”) and its wholly-owned subsidiaries, Stonewood Insurance Company (“Stonewood Insurance”) and Falls Lake Fire and Casualty Company (“Falls Lake Fire and Casualty”).

The Specialty Admitted Insurance segment produced 29.0% of our gross written premiums and 12.5% of our net written premiums from continuing operations for the year ended December 31, 2024.

The Specialty Admitted Insurance segment primarily writes fronting business where we retain a minority share of the risk, generally 10%-35%, and seek to earn fee income.

The Specialty Admitted Insurance segment produced 17.9% of our gross written premiums and 4.3% of our net written premiums for the year ended December 31, 2025.

The Specialty Admitted Insurance segment primarily writes fronting business where we retain a minority share of the risk, generally less than 10%, and seek to earn fee income.

When we front, we use our legal authority, financial strength rating, underwriting experience and claims infrastructure to write insurance to service clients (usually managing general agents and reinsurers) who assume the vast majority of the risk on each fronted policy.

Because we retain little premium or risk in our fronted business, we can allocate less capital per dollar of revenue to fronted policies than to policies where we retain more risk, which we believe enhances our returns on equity.

Because we retain little premium or risk in our fronted business, we can allocate less

capital per dollar of revenue to fronted policies than to policies where we retain more risk, which we believe enhances our returns on equity.

The Specialty Admitted Insurance segment accepts applications for insurance from a variety of sources, including fronting and program administrators and managing general agents (“MGAs”).

The Corporate and Other segment consists of the management and treasury activities of our holding companies, equity compensation for the group, and interest expense associated with our debt.

Our discontinued operations include JRG Re, which comprised the remaining operations of the former Casualty Reinsurance segment, and which, prior to the suspension of its underwriting activities in 2023, provided proportional and working layer casualty reinsurance to third parties.

The Corporate and Other segment consists of the management and treasury activities of our holding companies, long-term incentive compensation for the group (including subsidiaries), public company expenses, and interest expense associated with our debt.

Our discontinued operations consists of JRG Re, which comprised the remaining operations of the former Casualty Reinsurance segment, and which, prior to the suspension of its underwriting activities in 2023, provided proportional and working layer casualty reinsurance to third parties.

The sale of JRG Re, which closed on April 16, 2024, resulted in the Company’s disposition of its casualty reinsurance business and related assets.

In 2024, we wrote $1,431.8 million of gross written premiums from continuing operations, allocated by segment and underlying market as follows:

In 2025, we wrote $1,172.3 million of gross written premiums, allocated by segment and underlying market as follows:

Gross Written Premiums by Segment Gross Written Premiums

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We believe the “A-” (Excellent) ratings assigned to our U.S.

insurance subsidiaries allow our subsidiaries to actively pursue relationships with the agents and brokers identified in their marketing plans.

insurance subsidiaries allow our Excess and Surplus Lines segment to actively pursue relationships with the agents and brokers identified in its marketing plans.

In 2002, a group of experienced insurance executives created James River Group, Inc.

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The sale of JRG Re, which closed on April 16, 2024, allows us to focus on growing our U.S.

insurance and fronting businesses.

insurance business.

In November 2025, the Company completed the Domestication, changing the Company's incorporation from Bermuda to the U.S.

Our Competitive Strengths

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Focus on Small and Medium-Sized Casualty Niche and Specialty Business.

We believe that small- and medium-sized casualty accounts, in niche areas where we focus, are consistently among the most attractive subsets of the property-casualty

insurance and reinsurance market.

We believe that small- and medium-sized casualty accounts, in niche areas where we focus, are consistently among the most attractive subsets of the property-casualty insurance market.

We think the unique characteristics of the risks within these markets require each account to be individually underwritten in an efficient manner.

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Since our inception, we have embraced technology to greatly reduce the cost of individually underwriting these accounts in our Excess and Surplus Lines and Specialty Admitted Insurance segments.

We are investing in technologies that may bring additional insights to our underwriters and allow them to refine and improve their risk selection and pricing.

We are investing in technologies that we expect to bring additional insights to our underwriters and allow them to refine and improve their risk selection and pricing.

We continue to have our underwriters make individual judgments regarding the underwriting and pricing of accounts.

Our experience leads us to believe this approach, combining expert judgment and technology designed to provide our underwriters with relevant information and quick processing, is more likely to produce consistent results over time and across markets.

We are successfully increasing rates in our Excess and Surplus Lines segment.

Pricing on our E&S renewal book has increased for twenty-eight consecutive quarters.

The Excess and Surplus Lines segment represented 71.0% of our gross written premiums and 87.5% of our net written premiums from continuing operations for the year ended December 31, 2024.

Since our current CEO joined in 2020, we have made significant changes to our enterprise risk management, including portfolio monitoring, refinement in underwriting appetite and meaningful change to risk management practices.

We are successfully increasing renewal rates in our Excess and Surplus Lines segment.

Pricing on our E&S renewal book has increased for thirty-five consecutive quarters.

We believe that there are compelling opportunities for measured but profitable growth in many sectors of the insurance markets we target.

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Talented Underwriters and Operating Leadership.

The managers of our 15 underwriting divisions have an average of over 25 years of industry experience, substantial subject matter expertise and deep technical knowledge.

The managers of our underwriting divisions have many years of industry experience, substantial subject matter expertise and deep technical knowledge.

They have been successful and profitable underwriters for us in the specialty casualty insurance sector.

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We have implemented processes to capture extensive data from our book of business, before, during and after the underwriting analysis and decision.

We use the data we collect to inform and, we believe, improve our judgment about similar risks as we refine our underwriting criteria.

We use the data we collect to inform and, we believe, improve our judgment about similar risks as we refine our underwriting criteria, including for performance monitoring.

We use the data we collect in regular formal review processes for each of our lines of business.

Active Claims Management.

Our primary insurance companies actively manage claims.

Our insurance companies actively manage claims.

We attempt to investigate thoroughly and settle promptly all covered claims, which we generally accomplish through direct contact with the insured and other affected parties.

We have historically been able to close approximately 92% of claims from a particular policy year within the five subsequent years, and as of December 31, 2024, our reserves for claims incurred but not reported (“IBNR”) for our continuing operations were 63.5% of total net loss reserves.

As of December 31, 2025, our reserves for claims incurred but not reported (“IBNR”) were 73.5% of total net loss reserves.

Meaningful Risk Adjusted Investment Returns.

We seek to generate meaningful contributions to company profitability from our investment portfolio.

We attempt to follow a strategy that emphasizes the preservation of our invested assets, provides adequate liquidity for the prompt payment of claims and produces attractive results for our shareholders.

We seek to follow a strategy that emphasizes efficient returns on capital while maintaining adequate liquidity for the prompt payment of claims in order to produce attractive results for our shareholders.

Within that context, we seek to improve risk-adjusted returns in our investment portfolio by allocating a portion of our portfolio to investments where we take measured risks based upon detailed knowledge of certain niche asset classes.

Investment grade fixed maturity securities make up the majority of our investment portfolio, and we are comfortable allocating a portion of our assets to non-traditional investments.

We consider non-traditional investments to include investments that are (1) unrated bond or fixed income securities, (2) non-listed equities or (3) investments that generally have less liquidity than rated bond or fixed income securities or listed equities.

Non-traditional investments represented 9.4% of our total cash and invested assets (excluding restricted cash equivalents) at December 31, 2024, consisting of syndicated bank loans (7.4%) and other invested assets (1.9%) that include interests in limited liability companies that invest in renewable energy opportunities and limited partnerships that invest in debt or equity securities.

While we are willing to make investments in non-traditional types of investments, we seek to avoid asset classes and investments that we do not understand.

Investment grade fixed maturity securities make up the majority of our investment portfolio, and we are comfortable allocating a minority portion of our assets to non-traditional investments.

fixed income securities or listed equities.

Non-traditional investments represented 11.2% of our total cash and invested assets (excluding restricted cash equivalents) at December 31, 2025, consisting of syndicated bank loans (7.9%) and other invested assets (3.3%) that primarily include investments in structured private credit via investment grade rated notes, interests in limited liability companies that invest in renewable energy opportunities, and limited partnerships that invest in debt or equity securities.

The weighted average credit rating of our portfolio of fixed maturity securities, bank loans and preferred stocks as of December 31, 2025 was “A”.

At December 31, 2025, the average duration of our total invested assets and cash, excluding restricted cash, was 3.5 years.

We believe our approach to our business will help us achieve our goal of generating compelling returns on tangible equity while limiting volatility in our financial results.

We believe our approach to our business will help us achieve our goal of generating compelling returns on tangible common equity while limiting volatility in our financial results.

This approach involves the following:

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Respond Rapidly to Market Opportunities and Challenges.

For the year ended December 31, 2024, gross written premiums for the Excess and Surplus Lines segment increased by 1.0% over the same period in 2023.

Given the challenges the organization faced during 2024 especially, we view this as a validating result.

We seek to grow our business by taking advantage of opportunities in markets in which we believe we can use our expertise to generate consistent underwriting profits.

We seek to measure rates and react quickly to changes in the rates or terms the market will accept.

In this favorable pricing environment, we have taken steps to grow and are increasing gross written premiums across most underwriting divisions in this segment.

In 2024, our growth was primarily focused in our General Casualty, Environmental, and Sports and Entertainment divisions within our Excess and Surplus Lines segment.

This very specific evaluation of each risk or class of risks is a hallmark of our underwriting.

When market conditions have been challenging, or when actual experience has not been as favorable as we anticipated, or when the size or risk profile of certain insureds or lines of business change, we have tried to act quickly to evaluate our situation and to make course corrections in order to protect our profits and preserve tangible equity.

Very specific evaluations of each risk or class of risks is a hallmark of our underwriting.

Our actions have included reducing our writings when margins tightened and exiting lines or classes of business when we believed the risk of continuing in a line outweighed the potential rewards from underwriting.

We do not hesitate to increase loss estimates when we determine that it is appropriate.

In 2023, we took actions to reduce our workers' compensation book of business in the Specialty Admitted Insurance segment by the non-renewal of a large California program and by selling the renewal rights to our Individual Risk Workers' Compensation business.

For example, we have sought to materially reduce our exposure to commercial auto within both our Excess & Surplus Lines segment and Specialty Admitted Insurance segment as fundamentals shifted relative to our underwriting comfort.

In 2025, we also pulled away from certain larger accounts that no longer fall within our underwriting appetite.

Use Timely and Accurate Data.

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Manage Capital Actively.

We invest and manage our capital with a goal of consistently increasing tangible equity for our shareholders and generating attractive returns on tangible equity.

We invest and manage our capital with a goal of consistently increasing tangible common equity for our shareholders and generating attractive returns on tangible common equity.

We intend to expand our premium volume and capital base to take advantage of opportunities to earn an underwriting profit or to reduce our premium volume and capital base if attractive underwriting opportunities are not available.

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Best are very important to us, as are our relationships with our regulators, and maintaining them in good order is a principal consideration in our decisions regarding capital management.

Our ability to pay dividends and service our debt is dependent in part upon dividends from our insurance subsidiaries.

Our Structure

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and Atlanta, Georgia.

The Excess and Surplus Lines segment is our largest segment, representing 71.0% of consolidated gross written premiums from continuing operations for the year ended December 31, 2024.

The Excess and Surplus Lines segment is our largest segment, representing 82.1% of consolidated gross written premiums for the year ended December 31, 2025.

James River has been engaged in the E&S insurance market for over 20 years.

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We utilize a network of authorized wholesale brokers and general agents throughout the United States.

Gross written premiums for our Excess and Surplus Lines segment grew by 1.0%, 9.4%, and 10.5% in 2024, 2023, and 2022, respectively.

Net written premiums declined by 13.8% in 2024 compared to growth of 0.1% and 17.5% in 2023 and 2022, respectively.

Gross written premiums for our Excess and Surplus Lines segment declined by 5.3% in 2025, compared to growth of 1.0% and 9.4% in 2024 and 2023, respectively.

Markets are increasingly competitive, and of late, the Company has focused on gaining smaller accounts and pulled away from certain larger accounts that no longer fall within our underwriting appetite.

Net written premiums grew by 7.0% in 2025, declined by 13.8% in 2024, and grew by 0.1% in 2023.

The decline in 2024 was partially attributable to $52.8 million of ceded written premium recorded upon execution of the E&S Top Up ADC (as defined under the heading “Adverse Development Cover” below) in the fourth quarter of 2024.

Net written premiums in 2024 and 2023 were also impacted by premium adjustments associated with prior years including reinstatement premium, and the renewal of a quota share treaty, effective July 1, 2023, that increased premium cessions across all underwriting divisions other than Excess Casualty and resulted in lower retentions for the segment.

The Excess and Surplus Lines segment produced a cumulative combined ratio of 97.2% from 2015 through 2024.

Excluding our former insured, Rasier LLC and its affiliates (“Rasier”), the cumulative combined ratio of the Excess and Surplus Lines segment for 2019 through 2024 was 91.2%.

Net written premiums for the periods were also impacted by premium adjustments associated with prior years including reinstatement premium, and changes in reinsurance that impacted our net retentions.

Excluding our former insured, Rasier LLC and its affiliates (“Rasier”), the cumulative combined ratio of the Excess and Surplus Lines segment for 2020 through 2025 was 90.6% (inclusive of Rasier, the ratio was 99.8%).

Companies that underwrite on an E&S lines basis operate under a different regulatory structure than standard market carriers.

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E&S lines carriers are, for the most part, free of rate and form regulation.

In contrast, standard market carriers are generally required to use approved insurance forms and to charge rates that have been authorized by or filed with state

insurance departments.

In contrast, standard market carriers are

generally required to use approved insurance forms and to charge rates that have been authorized by or filed with state insurance departments.

However, as E&S carriers, our insurance subsidiaries in the Excess and Surplus Lines segment are not backed by any state’s guarantee fund, and in most states these subsidiaries may only write coverage for an insured after they have been declined coverage by the standard market.

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Claims for business written and retained by the Excess and Surplus Lines segment are managed by our internal claims department although we use independent adjusters for inspection and payment of certain claims.

The chart below identifies the Excess and Surplus Lines segment’s divisions and sets forth the amount of gross written premiums by each division.

The chart below identifies the Excess and Surplus Lines segment’s primary underwriting divisions, aligning with how we manage the business, and sets forth the amount of gross written premiums for each division.

Gross Written Premiums

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Excess Casualty $ 324,507 33.7 % $ 325,017 $ 339,870 $ 310,383 $ 285,082

General Casualty 237,632 23.4 % 202,861 173,574 140,608 125,433

Primary Casualty 312,176 32.4 % 327,589 288,627 262,412 217,273

Manufacturers and Contractors 157,082 16.3 % 176,494 180,074 156,645 139,720

Specialty 130,333 13.5 % 134,675 134,206 139,620 144,341

Excess Property 38,937 4.1 % 53,254 64,574 52,104 47,241

Energy 46,405 4.6 % 51,593 42,290 46,216 51,109

Small Business 39,946 3.9 % 38,561 36,930 32,593 24,790

Allied Health 31,791 3.1 % 30,904 34,156 35,192 26,918

Commercial Auto 27,819 2.7 % 29,379 37,974 34,630 30,029

Life Sciences 25,642 2.5 % 27,595 32,277 35,935 35,163

Sports and Entertainment 22,192 2.2 % 17,826 13,934 9,442 6,118

Environmental 20,096 2.0 % 13,832 20,676 17,050 17,753

Professional Liability 9,367 0.9 % 9,264 8,936 8,104 6,881

Medical Professionals 870 0.1 % 955 1,285 1,844 1,700

Management Liability 504 — % 63 — — —

Total $ 963,035 100.0 % $ 1,017,029 $ 1,007,351 $ 921,164 $ 833,657

Excess Casualty

Excess Casualty underwrites excess liability coverage for a variety of risk classes including manufacturers, contractors, distributors and transportation risks.

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When we write above others’ policies, we are selective regarding underlying carriers, focusing on the nature of the business, the financial strength of the carrier, their pricing and their claims handling capabilities.

Primary Casualty

Primary Casualty includes the following underlying divisions:

General Casualty writes primary liability coverage on businesses exposed to premises liability type claims including real estate, mercantile and retail operations, apartments and condominiums, hotels and motels, restaurants, bars, taverns and schools.

Manufacturers and Contractors writes primary general liability coverage for a variety of classes, including manufacturers of consumer, commercial, and industrial products and general and trade contractors.

Excess Property writes property risks providing limits in various layers above the primary coverage layer for a variety of classes, including apartments, condominiums, resorts, shopping centers, offices and general commercial properties.

Energy writes risks engaged in the business of energy production, distribution or mining, and the manufacture of equipment used in the energy business segment.

Examples of classes underwritten by this division include oil and gas exploration companies, oil or gas well drillers, oilfield consultants, oil or gas lease operators, oil well servicing companies, oil or gas pipeline construction companies, fireworks manufacturing, mining-related risks, utilities, and utility contractors.

Small Business includes both brokerage and delegated authority contract binding focusing on accounts with annual primary liability insurance premiums of less than $20,000 and more typically below $10,000.

For these smaller risks, we limit flexibility in coverage options and pricing to facilitate quick turnaround and efficient processing.

Allied Health underwrites casualty insurance for allied health and social service types of risks, such as long-term care facilities, independent living apartments, group homes, half-way houses and shelters, drug rehabilitation, home health care and medical staffing enterprises.

Commercial Auto underwrites primarily the hired and non-owned auto liability exposures for a variety of industry segments including package and food delivery services.

Life Sciences underwrites general liability, products liability and/or professional liability coverage for manufacturers, distributors and developers of biologics (antibodies & vaccines used for the prevention of disease), nutraceuticals (health, nutrition and herbal supplements), human clinical trials, pharmaceuticals (mainly generics and over-the-counters) and medical devices.

This division also writes a book of various types of business engaged in the medical and adult-use cannabis industry.

Sports and Entertainment underwrites primary liability coverage for sports, recreation and entertainment related risks, including special events, family entertainment centers, tourist attractions, health clubs, sports complexes and other sport and event venues.

Commercial Auto underwrites primarily the hired and non-owned auto liability exposures for a variety of industry segments including package and food delivery services.

Manufacturers and Contractors

Specialty includes the following underlying divisions:

Energy writes risks engaged in the business of energy production, distribution or mining, and the manufacture of equipment used in the energy business segment.

Environmental underwrites contractors’ pollution liability, products pollution liability, site specific pollution liability and consultant’s professional liability coverage on a stand-alone basis and in conjunction with the general liability coverage.

Typically, we write environmental coverage for contractors who are not engaged in environmental remediation work on an occurrence form.

Professional Liability writes professional liability coverage for accountants, architects, engineers, lawyers and certain other professions.

Medical Professionals underwrites non-standard physicians’ professional liability for individuals or small groups.

Our healthcare business is a mix of both surgical and non-surgical classes.

Management Liability, a new underwriting division in 2023, writes excess management liability coverage inclusive of directors & officers liability, employment practices liability, and fiduciary liability.

This division also writes a book of various types of business engaged in the medical and adult-use cannabis industry.

Management Liability, a new underwriting division in 2023, writes primary and excess management liability coverage inclusive of directors & officers liability, employment practices liability, and fiduciary liability.

The division underwrites a wide range of industries except for financial institutions and cryptocurrency firms.

We write publicly traded risks, privately held risks and not-for-profit risks.

We write excess only for publicly traded risks and both primary and excess for privately held risks and not-for-profit risks.

Professional Liability writes professional liability coverage for accountants, architects, engineers, lawyers and certain other professions.

Excess Property

Coverage Limits and Retention

The General Casualty, Manufacturers and Contractors, Small Business, Commercial Auto, and Sports and Entertainment divisions write primary liability coverage at $1.0 million per occurrence limits, of which we retain $730,000 net per occurrence.

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The Management Liability division also writes both primary and excess liability coverage with policy limits up to $10.0 million per coverage part, of which we retain up to $3.6 million net, but typically writes limits up to $5.0 million, retaining up to $2.3 million net per coverage.

Allied Health, Medical Professional and Professional Liability division coverages are issued on a claims made and reported basis.

Allied Health, Medical Professionals, Management Liability, and Professional Liability division coverages are issued on a claims made and reported basis.

Excess Property writes shared and layered limits property risks providing limits in various layers above another carrier’s primary coverage layer for a variety of commercial line classes including apartments, condominiums, resorts, shopping centers, offices and general commercial properties.

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The table also shows the percentage of each states’ gross written premium to total gross written premium in the Excess and Surplus Lines segment for the years ended December 31, 2025, 2024 and 2023.

States aggregated within all other individually represent less than 3% of total segment gross written premium in each of the years presented.

2025 2024 2023 2022 2021

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Premiums Gross

Texas $ 169,838 17.6 % $ 164,386 16.2 % $ 169,919 16.9 % $ 146,737 $ 128,312

Florida 169,655 17.6 % 184,639 18.2 % 176,730 17.5 % 161,679 137,880

California 161,437 16.8 % 171,029 16.8 % 172,114 17.1 % 157,519 147,677

Texas 164,386 16.2 % 169,919 16.9 % 146,737 15.9 % 128,312 79,338

New York 148,385 15.4 % 151,768 14.9 % 126,326 12.5 % 112,189 101,820

New Jersey 24,190 2.4 % 25,871 2.6 % 23,383 2.5 % 22,131 17,621

Washington 21,901 2.3 % 23,817 2.3 % 23,104 2.3 % 22,618 22,778

Illinois 21,796 2.1 % 21,399 2.1 % 17,526 1.9 % 19,010 16,243

Arizona 20,111 2.0 % 22,434 2.2 % 20,972 2.3 % 16,544 12,782

Georgia 19,075 1.9 % 22,205 2.2 % 18,636 2.0 % 15,522 11,934

Louisiana 15,905 1.6 % 16,054 1.6 % 17,161 1.9 % 15,723 13,968

Pennsylvania 15,110 1.5 % 17,794 1.8 % 23,548 2.5 % 22,055 19,008

Michigan 13,370 1.3 % 10,514 1.0 % 10,554 1.1 % 5,701 6,608

Nevada 12,090 1.2 % 10,842 1.1 % 9,271 1.0 % 7,371 5,765

Oregon 11,007 1.1 % 11,533 1.1 % 10,041 1.1 % 7,501 6,583

Missouri 10,794 1.1 % 11,812 1.2 % 12,446 1.4 % 11,967 10,080

All other states 291,819 30.3 % 321,390 31.6 % 339,158 33.7 % 320,422 295,190

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Marketing and Distribution

The Excess and Surplus Lines segment distributes its products through a select group of authorized E&S lines brokers we believe can consistently produce reasonable volumes of quality business.

The Excess and Surplus Lines segment distributes its products through a select group of authorized wholesale only E&S lines brokers we believe can consistently produce reasonable volumes of quality business.

These brokers procure policies for their clients from us as well as from other insurance companies.

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We believe the personal relationships we foster with individual brokers and our ability to respond to a wide variety of risks placed by these brokers make us an important market for them.

Our Excess and Surplus Lines segment’s three largest brokers produced $724.7 million of gross written premiums for the year ended December 31, 2024, representing approximately 71.3% of the Excess and Surplus Lines segment’s gross written premiums and 50.6% of consolidated gross written premiums from continuing operations for 2024.

The three largest brokers produced $345.1 million (Ryan Specialty Group), $245.5 million (Amwins Group), and $134.1 million (Truist Insurance Holdings) of gross written premiums for the year ended December 31, 2024, respectively, representing 24.1%, 17.1%, and 9.4% of consolidated gross written premiums from continuing operations and 33.9%, 24.1%, and 13.2% of the Excess and Surplus Lines segment’s gross written premiums for 2024, respectively.

In 2024 and 2023, our Excess and Surplus Lines segment paid an average commission to producers of 17.5% of gross written premiums.

Our Excess and Surplus Lines segment’s staff includes over 200 individuals directly employed in underwriting policies as of December 31, 2024.

Our Excess and Surplus Lines segment’s three largest brokers produced $689.4 million of gross written premiums for the year ended December 31, 2025, representing approximately 71.6% of the Excess and Surplus Lines segment’s gross written premiums and 58.8% of consolidated gross written premiums for 2025.

The three largest brokers produced $338.8 million (Ryan Specialty Group), $221.2 million (Amwins Group), and $129.4 million (CRC Group) of gross written premiums for the year ended December 31, 2025, respectively, representing 28.9%, 18.9%, and 11.0% of consolidated gross written premiums and 35.2%, 23.0%, and 13.4% of the Excess and Surplus Lines segment’s gross written premiums for 2025, respectively.

The average commission paid to producers by the Excess and Surplus Lines segment was 17.4% and 17.5% of gross written premiums in 2025 and 2024, respectively.

Our Excess and Surplus Lines segment’s staff includes close to 200 individuals directly employed in underwriting policies as of December 31, 2025.

We are very selective about the policies we bind.

Our Excess and Surplus Lines segment binds approximately 3% of new submissions and one out of every four new quotes.

Our Excess and Surplus Lines segment binds approximately 3% of new submissions and one out of every five new quotes.

If our underwriters cannot reasonably expect to bind coverage at the combination of premiums and coverage that meet our standards, they are encouraged to quickly move on to another prospective opportunity.

For the year ended December 31, 2024, we received approximately 327,000 submissions (new and renewal, excluding commercial auto policies), quoted over 62,000 policies, and bound more than 26,000 policies.

For the year ended December 31, 2025, we received approximately 353,000 submissions (new and renewal), quoted over 64,000 policies, and bound more than 25,000 policies.

When we accept risk in our Excess and Surplus Lines segment, we are careful to establish terms that are suited to the risk and the pricing.

As an excess and surplus lines writer, we use our freedom of rate and form to make it possible to take on risks that have already been rejected by admitted carriers who have determined they cannot insure these risks on approved forms at filed rates.

We attempt to craft policies that offer affordable protection to our insureds by tailoring coverage in ways that make potential losses more predictable and are intended to reduce claims costs.

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We believe that effective management of claims settlement and any associated litigation avoids delays and associated additional costs.

Over 70 claims professionals with significant experience in the property-casualty industry support our Excess and Surplus Lines segment as of December 31, 2024.

Over 70 claims personnel with significant experience in the property-casualty industry support our Excess and Surplus Lines segment as of December 31, 2025.

Our excess and surplus lines business generally results in claims from premises/operations liability, professional liability, hired and non-owned auto liability, auto physical damage, first party property losses and products liability.

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Prior to any scheduled mediation or trial involving a claim, claims personnel conduct further peer review to make sure all issues and exposures have been adequately analyzed.

Our claims staff also contributes to our underwriting operations through communication of claims information to our underwriters.

Our claims staff also contribute to our underwriting operations through communication of claims information to our underwriters.

Members of our Claims team participate on our forms committee, which reviews and develops all policy forms and exclusions, and are also members of the underwriting review committee.

Approximately 92% of all claims received are closed within five years in the Excess and Surplus Lines segment.

The calendar year net loss ratios for the Excess and Surplus Lines segment for the last ten years were:

The calendar year net loss ratios for the Excess and Surplus Lines segment for the years 2020-2025 were:

The calendar year loss ratio for 2025 reflects the cession of $51.4 million of losses and loss adjustment expenses to the E&S Top Up ADC that are not subject to deferral under retroactive reinsurance accounting since that ADC is not in a gain position at December 31, 2025.

The calendar year loss ratio for 2024 was impacted by a $52.2 million reserve charge upon execution of the E&S ADC (as defined below) (consideration paid in excess of initial reserves) discussed below and $52.8 million of ceded premium recorded upon execution of the E&S Top Up ADC (as defined below).

The calendar year loss ratios for 2017 through 2021 were impacted by adverse reserve development of $38.7 million, $20.7 million, $57.4 million, $91.4 million and $200.1 million, respectively, in the commercial auto line of business that was primarily related to a former insured, Rasier.

The calendar year loss ratios for 2020 and 2021 were impacted by adverse reserve development of $91.4 million and $200.1 million, respectively, in the commercial auto line of business that was primarily related to a former insured, Rasier.

The loss ratios for 2022 and 2021 also include net catastrophe losses in the Excess Property line of business of $5.0 million related to Hurricane Ian in 2022 and $5.0 million related to Hurricane Ida in 2021.

Loss Portfolio Transfers and Adverse Development Covers

The Company has entered into loss portfolio transfers and adverse development covers to transfer losses and loss adjustment expenses and associated risk of adverse development on covered subject E&S business, as defined in the respective agreements, to assuming reinsurers in exchange for reinsurance premium.

Loss portfolio transfers and adverse development covers are forms of retroactive reinsurance utilized by the Company to transfer losses and loss adjustment expenses and associated risk of adverse development on covered subject business, as defined in the respective agreements, to an assuming reinsurer in exchange for a reinsurance premium.

This reinsurance can bring

economic finality (up to the limit of such agreements, if applicable) on the subject risks when they no longer meet the Company's risk appetite or are no longer aligned with the Company's risk management guidelines.

Commercial Auto Loss Portfolio Transfer

On September 27, 2021, James River entered into a loss portfolio transfer transaction (the “Commercial Auto LPT”) with Aleka Insurance, Inc.

(“Aleka”), a captive insurance company affiliate of Rasier, to reinsure substantially all of the Excess and Surplus Lines segment's legacy portfolio of commercial auto policies previously issued to Rasier for which James River is not otherwise indemnified by Rasier.

On September 27, 2021, James River Insurance and James River Casualty Company (together, “James River”) entered into a loss portfolio transfer transaction (the “Commercial Auto LPT”) with Aleka Insurance, Inc.

(“Aleka”), a captive insurance company affiliate of Rasier LLC, to reinsure substantially all of the Excess and Surplus Lines segment's legacy portfolio of commercial auto policies previously issued to Rasier LLC and its affiliates (collectively, “Rasier”) for which James River is not otherwise indemnified by Rasier.

The reinsurance coverage is structured to be fully collateralized, is not subject to an aggregate limit, and is subject to certain exclusions.

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The E&S ADC was effective January 1, 2024 (the “Effective Date”) and applies to James River’s Excess & Surplus Lines segment casualty portfolio losses attaching to premium earned during 2010-2023 (both years inclusive), excluding, among others, losses related to commercial auto policies issued to a former large insured or its affiliates (the “Subject Business”).

Pursuant to the E&S ADC, (1) State National reinsures 85% of losses paid on and after the Effective Date in respect of the Subject Business in excess of $716.6 million up to an aggregate limit of $467.1 million (with State National’s share of the aggregate limit being $397.0 million) in exchange for a reinsurance premium paid by James River equal to $313.2 million, (2) James River continues to manage claims and to manage and collect the benefit of other existing third-party reinsurance on the Subject Business, which third-party reinsurance inures to the benefit of the E&S ADC, and (3) James River is entitled to a profit commission of 50% of any favorable development on the business ceded to State National below 104.5% of carried reserves, which profit commission shall not exceed $87.0 million in total.

The Company has $41.2 million of aggregate limit remaining on the E&S ADC at December 31, 2024.

Pursuant to the E&S ADC, (a) State National reinsures 85% of losses paid on and after the Effective Date in respect of the Subject Business in excess of $716.6 million up to an aggregate limit of $467.1 million (with State National’s share of the aggregate limit being $397.0 million) in exchange for a reinsurance premium paid by James River equal to $313.2 million, and (b) James River continues to manage claims and to manage and collect the benefit of other existing third-party reinsurance on the Subject Business, which third-party reinsurance inures to the benefit of the E&S ADC.

Additional adverse development of $35.0 million (net of the Company's 15% retention) recognized on the subject business of the E&S ADC in the year ended December 31, 2025 exhausted the remaining limit of the E&S ADC.

Adverse Development Cover

The Company commenced a multi-pronged strategic partnership with Enstar.

As part of this, on November 11, 2024, Enstar, through its subsidiary Cavello Bay Reinsurance Limited (“Cavello Bay”), entered into an adverse development cover agreement with James River (“E&S Top Up ADC”).

Pursuant to this agreement, in exchange for a premium of $52.8 million (less an amount equal to the federal excise tax payable on the premium), Cavello Bay reinsures, effective January 1, 2024, 100% of the losses associated with James River’s Excess & Surplus Lines segment portfolio losses attaching to premium earned during 2010-2023 (both years inclusive).

This agreement excludes losses related to commercial auto policies issued to a former large insured or its affiliates.

It is subject to a retention by James River of $1,183.7 million (the limit of the E&S ADC executed on July 2, 2024) and up to an aggregate limit of $75.0 million.

On November 11, 2024, Enstar Group Limited (“Enstar”), through its subsidiary Cavello Bay Reinsurance Limited (“Cavello Bay”), entered into an adverse development cover agreement with James River (“E&S Top Up ADC”), pursuant to which, in exchange for a premium of $52.8 million (less an amount equal to the federal excise tax payable on the premium), Cavello Bay reinsures, effective January 1, 2024, 100% of the losses associated with James River’s Excess and Surplus Lines segment casualty portfolio losses attaching to premium earned during 2010-2023 (both years inclusive).

The E&S Top Up ADC excludes losses related to commercial auto policies issued to a former large insured or its affiliates and is subject to a retention by James River of $1,183.7 million (the limit of the E&S ADC executed on July 2, 2024) and up to an aggregate limit of $75.0 million.

The E&S Top Up ADC closed on December 23, 2024.

The Company recognized a $52.8 million reduction in pre-tax income in connection with the adverse development cover upon closing.

The Company has $75.0 million of aggregate limit remaining on the E&S Top Up ADC at December 31, 2024.

In 2025, $51.4 million of adverse development was ceded to the E&S Top Up ADC, reducing the aggregate limit remaining on the E&S Top Up ADC to $23.6 million at December 31, 2025.

Specialty Admitted Insurance Segment

The Falls Lake Insurance Companies (“Falls Lake”) comprise our other U.S.

insurance segment, Specialty Admitted Insurance.

The Falls Lake Insurance Companies (“Falls Lake”) comprise our other insurance segment, Specialty Admitted Insurance.

Falls Lake consists of Falls Lake National (an Ohio domiciled company, licensed in 49 states and the District of Columbia and registered as a surplus lines company in California), and its subsidiaries Stonewood Insurance (an Ohio domiciled company) and Falls Lake Fire and Casualty (a California domiciled company).

The Specialty Admitted Insurance segment produced 29.0% of gross written premiums from continuing operations for the year ended December 31, 2024.

The Specialty Admitted Insurance segment produced 17.9% of gross written premiums for the year ended December 31, 2025.

Fronting & Program Business

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In a fronting arrangement, we give selected MGAs authority to act on our behalf to produce, underwrite and administer policies that meet our underwriting and pricing guidelines.

We generally retain 10%-35% of the underwriting risk in our fronting business.

We retain a small percentage of the underwriting risk in our fronting business (<5% retention across in force programs).

The issuance of our policy makes us contractually responsible to the insured in the event they experience a covered loss.

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We establish fronting opportunities through a variety of sources, including direct carrier relationships, MGAs, reinsurers, and reinsurance brokers.

Our objective is to utilize the combination of fee income and underwriting profits from our Specialty Admitted Insurance segment to leverage our capital and improve returns on tangible equity.

Fee income was $21.0 million in 2024, $24.2 million in 2023, and $23.6 million in 2022.

We are selective with fronting opportunities, focusing on low net retentions, placing strong, rated, reinsurance support, and close management of expenses.

We currently retain less than 5% of gross premiums written on in force programs in this segment.

The fronting and reinsurance markets are currently very competitive, and we have refined our underwriting appetite meaningfully over the last few years.

We have also focused many of our strategic initiatives on our larger E&S segment.

We have worked to reduce commercial auto exposure in 2025.

Fee income for the segment was $13.4 million in 2025, $21.0 million in 2024, and $24.2 million in 2023.

Our licensure and product filings position us to support this business throughout the United States.

Because of the more limited capital allocation required to support it, we believe the fronting business represents an efficient use of capital.

Because of the more limited capital allocation required to support it, we believe the fronting business can represent an efficient use of capital, and we continue to generate meaningful net investment income from the invested assets supporting our fronting business.

The segment currently has four active programs.

Our largest fronting relationship produced $73.0 million of gross written premiums in 2025, representing 6.2% of consolidated gross written premiums from continuing operations and 34.9% of the Specialty Admitted Insurance segment's gross written premiums, respectively.

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Actions to Reduce Workers' Compensation Book

In June 2023, the Company non-renewed its large California workers' compensation program in the Specialty Admitted Insurance segment.

This action was taken due to persistent rate pressure and tighter reinsurance capacity.

Gross written premiums for the program were $21.3 million, $96.5 million, and $110.9 million for the years ended December 31, 2024, 2023, and 2022, respectively.

On September 25, 2023, the Company announced that certain of its subsidiaries entered into an agreement to sell the renewal rights to the Individual Risk Workers' Compensation (“IRWC”) business in the Specialty Admitted Insurance segment.

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The Company also recognized an impairment charge of $2.5 million related to the trademark intangible asset associated with the IRWC business.

A few months earlier, in June 2023, the Company non-renewed its large California workers' compensation program in the Specialty Admitted Insurance segment.

This action was taken due to persistent rate pressure and tighter reinsurance capacity.

Gross written premiums for the program were $(659,000), $21.3 million, and $96.5 million for the years ended December 31, 2025, 2024, and 2023, respectively.

Corporate and Other Segment

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Purchased Property Reinsurance

Our focus on return on tangible equity leads us to avoid lines of business that we know are exposed to high degrees of volatility.

Our focus on return on tangible common equity leads us to avoid lines of business that we know are exposed to high degrees of volatility.

The Excess and Surplus Lines segment writes a limited book of excess property risks ($38.9 million of direct written premiums in 2025).

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(in thousands)

State National Insurance Company (including E&S ADC of $397.0 million) $ 401,148 A

Swiss Reinsurance America Corporation 341,526 A+

State National Insurance Company (E&S ADC) 365,549 A

Berkley Insurance Company 194,180 A+

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Motors Insurance Corporation 77,644 A

Endurance Assurance Corporation 45,111 A+

Cavello Bay Reinsurance Limited (E&S Top Up ADC) 51,394 A

American European Insurance Company 43,039 B- (1)

SiriusPoint America Insurance Company 37,084 A-

Aleka Insurance Company (Commercial Auto LPT) 35,315 Unrated(1)

North Carolina Reinsurance Facility 35,300 Unrated (2)

Top 10 Total 1,380,166

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Total $ 2,026,110

(1) This reinsurer is unrated.

All material reinsurance amounts from this reinsurer are collateralized.

(1) This reinsurer is below A-.

All material reinsurance recoverable amounts from this reinsurer are collateralized.

(2) The North Carolina Reinsurance Facility is a residual market mechanism for automobile insurance in North Carolina.

Amounts Recoverable from an Indemnifying Party and Reinsurer on Legacy Commercial Auto Book

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James River has indemnity agreements with Rasier (non-insurance entities) (collectively, the “Indemnity Agreements”) and is contractually entitled to reimbursement for the portion of the losses and loss adjustment expenses paid on behalf of Rasier under the Rasier Commercial Auto Policies and other expenses incurred by James River.

On September 27, 2021, James River entered into the Commercial Auto LPT with Aleka to reinsure substantially all of the Rasier Commercial Auto Policies for which James River is not otherwise indemnified by Rasier under the Indemnity Agreements.

Under the terms of the Commercial Auto LPT, effective as of July 1, 2021, James River ceded to Aleka approximately $345.1 million of commercial auto liabilities relating to Rasier Commercial Auto Policies written in the years 2013-2019, which amount constituted the reinsurance premium.

Since inception, due to adverse paid and reported loss trends on the legacy Rasier business, the Company has recognized adverse prior year development of $114.2 million on the reserves subject to the Commercial Auto LPT, bringing the cumulative amount ceded under the Commercial Auto LPT to $459.3 million at December 31, 2024.

Each of Rasier and Aleka are required to post collateral under the Indemnity Agreements and the Commercial Auto LPT:

• Pursuant to the Indemnity Agreements, Rasier is required to post collateral equal to 102% of James River's estimate of the amounts that are recoverable or may be recoverable under the Indemnity Agreements, including, among other things, case loss and loss adjustment expense reserves, IBNR (as defined below) loss and loss adjustment expense reserves, extra contractual obligations and excess policy limits liabilities.

The collateral is provided through a collateral trust arrangement (the “Indemnity Trust”) in favor of James River by Aleka.

In connection with the execution of the Commercial Auto LPT, James River returned $691.3 million to the Indemnity Trust, representing the remaining balance of the amount withdrawn in October 2019, as was permitted under the indemnification agreements with Rasier and the associated trust agreement.

At December 31, 2024, the balance in the Indemnity Trust was $64.7 million, and, together with the balance of the Loss Fund Trust (as defined below) attributable to the Indemnity Agreements as described below, the total balance of collateral securing Rasier’s obligations under the Indemnity Agreements was $82.1 million.

• Pursuant to the Commercial Auto LPT, Aleka is required to post collateral equal to 102% of James River's estimate of Aleka's obligations under the Commercial Auto LPT, calculated in accordance with standard actuarial principles and based on

reserves recorded in the Company's statutory financial statements.

The collateral is provided through a collateral trust arrangement (the “LPT Trust”) established in favor of James River by Aleka.

At December 31, 2024, the balance in the LPT Trust was $30.1 million, and, together with the balance of the Loss Fund Trust (as defined below) attributable to the Commercial Auto LPT as described below, the total balance of collateral securing Aleka’s obligations under the Commercial Auto LPT was $37.8 million.

In addition, on September 27, 2021, James River entered into the Commercial Auto LPT with Aleka to reinsure substantially all of the Rasier Commercial Auto Policies for which James River is not otherwise indemnified by Rasier under the Indemnity Agreements.

Each of Rasier and Aleka are required to post collateral equal to 102% of James River's estimate of the respective parties' obligations in trusts pursuant to the terms of the Indemnity Agreements and the Commercial Auto LPT, respectively.

At December 31, 2025, the total balance of collateral securing Rasier's obligations under the Indemnity Agreements was $41.3 million and Aleka's obligations under the Commercial Auto LPT was $19.9 million.

At December 31, 2025, the total reinsurance recoverables under the Commercial Auto LPT was $12.4 million.

In connection with the execution of the Commercial Auto LPT, James River and Aleka entered into an administrative services agreement (the “Administrative Services Agreement”) with a third party claims administrator (the “Administrator”) pursuant to which the Administrator handles the claims on the Rasier Commercial Auto Policies for the remaining life of those claims.

The claims paid by the Administrator are reimbursable by James River, and pursuant to the Administrative Services Agreement, James River established a loss fund trust account for the benefit of the Administrator (the “Loss Fund Trust”) to collateralize its claims payment reimbursement obligations.

James River funds the Loss Fund Trust using funds withdrawn from the Indemnity Trust, funds withdrawn from the LPT Trust, and its own funds, in each case in an amount equal to the pro rata portion of the required Loss Fund Trust balance attributable to the Indemnity Agreements, the Commercial Auto LPT and James River’s existing third party reinsurance agreements, respectively.

At December 31, 2024, the balance in the Loss Fund Trust was $28.7 million, including $17.4 million representing collateral supporting Rasier’s obligations under the Indemnity Agreements and $7.7 million representing collateral supporting Aleka’s obligations under the Commercial Auto LPT.

Funds posted to the Loss Fund Trust are classified as restricted cash equivalents on the Company's balance sheet.

While the Commercial Auto LPT brings economic finality to substantially all of the Rasier Commercial Auto Policies, the Company has credit exposure to Rasier and Aleka under the Indemnity Agreements and the Commercial Auto LPT if the estimated losses and expenses of the Rasier Commercial Auto Policies grow at a faster pace than the growth in our collateral balances.

In addition, the Company has credit exposure if its estimates of future losses and loss adjustment expenses and other amounts recoverable under the Indemnity Agreements and the Commercial Auto LPT, which are the basis for establishing the collateral balances, are lower than actual amounts paid or payable.

The amount of credit exposure in any of these instances could be material.

To mitigate these risks, the Company closely and frequently monitors exposure compared to collateral held, and requests additional collateral in accordance with the terms of the Commercial Auto LPT and Indemnity Agreements when its analysis indicates that the Company has uncollateralized exposure.

The amount of the Company's credit exposure in any of these instances could be material.

To mitigate these risks, the Company closely and frequently monitors its exposure compared to the collateral held, and requests additional collateral in accordance with the terms of the Commercial Auto LPT and Indemnity Agreements when its analysis indicates that it has uncollateralized exposure.

Reserve Policy

We seek to establish reserves that will adequately meet our obligations.

All of our reserving actuaries are credentialed.

We engage independent actuarial consultants to perform independent valuations to corroborate our decisions regarding reserves.

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Our Reserve Committee consists of our Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer, and Chief Actuary.

Additionally, the presidents, chief financial officers and segment actuaries of each of our insurance segments participate in the Reserve Committee meetings for their respective segments.

Additionally, the presidents, chief financial officers, Chief Claims Officer and segment actuaries of each of our insurance segments participate in the Reserve Committee meetings for their respective segments.

The Reserve Committee meets quarterly to review the actuarial recommendations made by each segment actuary and use their best judgment to determine the best estimate to be recorded for the reserve for losses and loss adjustment expenses on our balance sheet.

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5,011 (54,426)

5,252 (45,921)

2018 (15,012) (6)

5,560 (9,452)

2017 (20,023) (7)

2,721 (17,302)

2016 24,079 3,822 27,901

2015 25,424 3,531 28,955

Cumulative Development $ (354,220) $ 9,778 $ (344,442)

(1) The $5.0 million of net favorable development is net of $51.4 million ceded to the E&S Top Up ADC.

The E&S Top Up ADC is not in a gain position, thus it is not subject to retroactive reinsurance accounting and there are no deferrals related to the E&S Top Up ADC in 2025.

Accordingly, all cessions to the E&S Top Up ADC in 2025 reduce net incurred losses and loss adjustment expenses.

Additionally, the net favorable development excludes $27.2 million of adverse development ceded to the Commercial Auto LPT and E&S ADC that was deferred under retroactive reinsurance accounting.

The $27.2 million is included in net incurred losses and loss adjustment expenses on the Consolidated Statements of Income (Loss) and Comprehensive Income (Loss).

(2) Includes a $52.2 million reserve charge upon execution of the E&S ADC (consideration paid in excess of initial reserves).

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(5) Includes $91.4 million of adverse development in the commercial auto line of business that was primarily related to the 2018 and prior contract years with Rasier, partially offset by $32.0 million of favorable development from other divisions.

(5) Includes $57.4 million of adverse development in the commercial auto line of business that was primarily related to the 2016 and 2017 contract years with Rasier, partially offset by $6.2 million of favorable development from other divisions.

(6) Includes $20.7 million of adverse development in the commercial auto line of business that was primarily related to the 2016 contract year with Rasier, partially offset by $5.7 million of favorable development from other divisions.

(7) Includes $38.7 million of adverse development in the commercial auto line of business that was primarily related to the 2016 contract year with Rasier, partially offset by $18.6 million of favorable development from other divisions primarily from the 2014 through 2016 accident years.

Among the indicators of reserve strength that we monitor is the amount of IBNR reserves held on our balance sheet for claims that have been incurred but not yet reported.

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2023 70.4 % 83.6 % 93.7 % 90.2 %

2023 69.3 % 79.6 % 75.0 % 81.5 %

2024 58.5 % 73.6 % Not Applicable 87.5 %

Investment Strategy

Our investment strategy seeks to generate stable investment income and contributions to growth in tangible equity, while providing sufficient liquidity to meet our claims and other obligations.

Our investment strategy seeks to generate stable investment income and contributions to growth in tangible common equity, while providing sufficient liquidity to meet our claims and other obligations.

We attempt to generate better than market average risk-adjusted returns in our investment portfolio by taking measured risks based upon detailed knowledge of certain niche asset classes.

While we are willing to make investments in non-traditional types of investments, we avoid risks that we do not understand well, as well as structures or situations we think could cause substantial loss of capital.

The vast majority of our investment portfolio is managed by third party, independent investment managers.

Our investment portfolio is managed by third party, independent investment managers.

The majority of our investment portfolio is invested in investment grade fixed income securities.

This portfolio provides predictable income with low risk of principal loss and strong liquidity.

We seek to augment our overall return and income by

investing in bank loans and other higher yielding assets, including equity securities and private investments.

We seek to augment our overall return and income by investing in bank loans, private credit via investment grade rated note structures, and other higher yielding assets, including equity securities and other private investments.

We designed these strategies to improve our investment return, and we are focused on opportunistic investing in areas where we believe our management has expertise or an appropriate understanding of the risk and return of the investment.

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Common stock 2,553 2,491 2,491 NA 0.1 %

Short-term investments 97,074 97,074 97,074 4.3 % 5.1 %

Other invested assets 64,152 64,152 64,152 NA 3.3 %

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Fixed maturity and preferred stock investments primarily consist of investment grade fixed income and preferred stock securities, which make up 75.4% of total invested assets and cash.

Common stock investments are 0.8% of total invested assets and cash.

Our objective with fixed maturity, preferred stock and common stock investments is to earn attractive risk-adjusted returns with a low risk of loss of principal, while earning attractive income.

Our objective with fixed maturity and preferred stock investments is to earn attractive risk-adjusted returns with a low risk of loss of principal, while earning attractive income.

The Bank Loan portfolio primarily consists of investments in participations in syndicated bank loans, but may also include a small allocation of bonds.

Bank loans in our portfolio are generally senior secured loans with an average credit quality of “B” as of December 31, 2025 and floating interest rates based on spreads over SOFR.

We believe bank loans are an attractive asset class because (1) floating-rate loans help to reduce our risk of loss in the event of rising interest rates, (2) the loans are generally senior secured, (3) the asset class has a history of relatively high recovery rates in the event of default, (4) the portfolio provides an attractive yield and (5) the maturities of the loans are relatively short (average of approximately 5 years).

We invest in this asset class by owning individual loan participations that are carried at fair market value.

We believe bank loans are an attractive asset class because (1) the loans are generally senior secured, (2) the asset class has a history of relatively high recovery rates in the event of default, (3) the portfolio provides an attractive yield, (4) the maturities of the loans are relatively short (average of approximately 5 years), and (5) floating-rate loans mitigate the risk of loss in the event of rising interest rates.

We invest in this asset class by owning a diversified portfolio of individual loan participations that are carried at fair market value.

As of December 31, 2025, bank loans totaled 7.9% of total invested assets and cash.

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We focus on investments where we believe we have an understanding of the risk and opportunity and have the ability to monitor them closely.

At December 31, 2024, we held eight private investments with a total carrying value of $36.7 million.

Our portfolio consists of investments in wind and solar energy, banking, small cap equities, loans of middle market private equity sponsored companies, asset management firms and other investments.

At December 31, 2025, we held ten private investments with a total carrying value of $64.2 million.

Our portfolio consists of investments in structured private credit primarily through investment grade rated notes, wind and solar energy, loans of middle market private equity sponsored companies, asset management firms and other investments.

We are opportunistic in our private investment strategy and our portfolio may grow or shrink based on the opportunities available to us.

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The insurance business is cyclical in nature, with “hard” and “soft” cycles.

Hard markets occur when insurance underwriters limit their exposure in a line of business or across their entire portfolio.

When underwriters exercise restraint, insurance buyers are forced to pay more to induce underwriters to cover their risks.

A hard market can also be created by economic expansions when capital committed to backing insurance policies does not grow as fast as the demand for insurance.

There is generally a correlation between interest rates and the willingness of insurance companies to commit their capital to writing insurance.

When fixed income yields are low, insurance companies may need to raise insurance prices to improve underwriting results in order to offset loss of investment income.

The table below shows the changes in gross written premiums we have experienced in our operating segments from 2023 through 2025.

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We have, therefore, sought to diversify this business by geography, line of business and revenue stream.

While we have been growing this business and achieving increasing or stable rates for several periods through December 31, 2024, there will likely be periods in the future where our growth moderates, stagnates or turns negative.

The market for most lines of commercial insurance, other than workers' compensation, are currently in a hardening phase.

The Excess and Surplus Lines segment has historically been able to make an underwriting profit regardless of the state of the underwriting cycle.

This segment's cumulative combined ratio for 2015 through 2024 is 97.2%.

Excluding Rasier, the cumulative combined ratio of the Excess and Surplus Lines segment for 2019 through 2024 was 91.2%.

In 2025, markets were increasingly competitive and the Company focused on gaining smaller accounts while pulling away from certain larger accounts that were no longer within our underwriting appetite, contributing to a 5.3% decline in gross written premiums for this segment in 2025 compared to 2024.

Prior to 2025, we had been growing this business and achieving increasing or stable rates.

While the Company continued to achieve renewal rate increases in 2025, the market for most lines of commercial insurance has showed signs of softening in recent quarters.

Traditionally, admitted insurance lines have been very susceptible to market cycles.

We believe this trend is continuing.

We seek to isolate ourselves from these trends in our Specialty Admitted Insurance segment by writing lines of business we believe are slightly less competitive, by prudently purchasing reinsurance and by being willing to dramatically reduce our writings when market conditions warrant.

We seek to isolate ourselves from these trends in our Specialty Admitted Insurance segment by refining our underwriting appetite, by prudently purchasing reinsurance and by being willing to dramatically reduce our writings when market conditions warrant.

The decline in gross written premiums in 2025 reflects this approach.

The fronting market has seen a significant increase in competition, putting pressure on reinsurance terms and conditions and net retentions, causing us to be selective with fronting opportunities.

During 2025, we worked to reduce commercial auto exposure in our fronting book, and we are focused on managing expenses for the segment.

A material portion of the profitability we seek to achieve from our fronting business has come from fee income that is generated via policies that are issued by our insurance companies and then mostly or wholly reinsured to third parties.

Because we earn substantial fees from underwriting business on which we retain little or no insurance risk, this business can be profitable to us even in soft market conditions.

Gross written premiums were $410.4 million ($69.8 million on a net basis) for fronting and program business in 2024.

Because we earn fees from underwriting business on which we retain little or no insurance risk, this business can be profitable to us even in soft market conditions.

We compete in a variety of markets against a variety of competitors depending on the nature of the risk and coverage being underwritten.

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The Excess and Surplus Lines segment may also compete with national and regional carriers from the standard market willing to underwrite selected accounts on an admitted basis.

Competitors in this segment include ACE Westchester Specialty Group (Chubb), AmRisc Insurance Company (Truist Insurance Holdings), Apollo Syndicate, Alleghany Corporation (Berkshire Hathaway), Allied World Assurance Company, Ltd., AmTrust Financial Services, Inc., Arch Capital Group Ltd., Arrowhead General Insurance Agency, Inc., Aspen Insurance Holdings Limited, Ategrity Specialty Insurance Company, AXA XL, Axis Insurance Company (Axis Capital Holdings Limited), Beazley Group (Lloyd’s), Berkshire Hathaway Specialty Insurance, Brit Insurance (Lloyd’s), Colony Specialty Insurance Company (Argo Group International Holdings, Ltd.), Endurance Specialty (Sompo), Fairfax Financial Holdings, Ltd., Hamilton Insurance Group, Ltd., Hiscox Insurance Company (Lloyd’s), Houston Casualty Company (a subsidiary of Tokio Marine HCC), Kinsale Capital Group, Inc., Lexington Insurance

Company (American International Group, Inc.), Markel Corporation, Navigators Insurance Company (Hartford), OneBeacon (Intact Financial Corporation), Old Republic International Corporation, PHLY E&S (Philadelphia Consolidated Holding Corp.

Tokio Marine), ProAssurance Corporation, QBE Insurance Group Ltd., RLI Corp., Scottsdale Insurance Company (Nationwide E&S), Skyward Specialty Insurance Group, Inc., Starr Insurance Company (C.V.

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National carriers tend to compete for fronting and program accounts along all product lines.

Competition for our fronting business includes but is not limited to State National (part of Markel), Argo Group, Clear Blue, Spinnaker, Trisura, Red Point, Equity Insurance Company, Worth Insurance, and Amtrust.

Certain Bermuda Law Considerations

Bermuda Corporate Law Considerations

Although James River Group Holdings, Ltd.

is incorporated in Bermuda, it is designated as a non-resident for Bermuda exchange control purposes by the Bermuda Monetary Authority (“BMA”).

Pursuant to its non-resident status, James River Group Holdings, Ltd.

may engage in transactions in currencies other than the Bermuda dollar, and there are no restrictions on its ability to transfer funds (other than funds denominated in Bermuda dollars) in and out of Bermuda or to pay dividends to non-residents who are holders of its common shares in currencies other than the Bermuda dollar.

In accordance with Bermuda law, share certificates are issued only in the names of companies, partnerships or individuals.

In the case of an applicant acting in a special capacity (for example, as an executor or trustee), certificates may, at the request of the applicant, record the capacity in which the applicant is acting.

Notwithstanding the recording of any such special capacity, we are not bound to investigate or see to the execution of any such trust.

We will take no notice of any trust applicable to any of our common shares whether or not we have notice of such trust.

James River Group Holdings, Ltd.

is incorporated in Bermuda as an “exempted company.” Under Bermuda law, exempted companies are companies formed for the purpose of conducting business outside Bermuda from a principal place of business in Bermuda.

As a result, they are exempt from Bermuda laws restricting the percentage of share capital that may be held by non-Bermudians.

However, exempted companies may not participate in certain business transactions, including:

(i) the acquisition or holding of land in Bermuda except that required for their business and held by way of lease or tenancy for a term not exceeding 50 years or, with the consent of the Minister of Finance granted in his discretion by way of lease or tenancy for a term not exceeding 21 years in order to provide accommodation or recreational facilities for its officers and employees, (ii) the taking of mortgages on land in Bermuda to secure an amount in excess of B.D.$50,000 without the consent of the Minister of Finance, (iii) the acquisition of any bonds or debentures secured by any land in Bermuda, other than certain types of Bermuda government securities or securities issued by Bermuda public authorities, or (iv) the carrying on of business of any kind in Bermuda, except in furtherance of business carried on outside Bermuda or under license granted by the Minister of Finance.

James River Group Holdings, Ltd.

must comply with the provisions of the Companies Act 1981 of Bermuda (the “Companies Act”) regulating the payment of dividends and making distributions from contributed surplus.

A company may not declare or pay a dividend, or make a distribution out of contributed surplus, if there are reasonable grounds for believing that (i) it is, or would after the payment be, unable to pay its liabilities as they become due, or (ii) the realizable value of the assets would thereby be less than its liabilities.

Under the Companies Act, where a Bermuda company issues shares at a premium (that is, for a price above the par value), whether for cash or otherwise, a sum equal to the aggregate amount or value of the premium on those shares must be transferred to an account called “the share premium account.” The provisions of the Companies Act relating to the reduction of the share capital of a company apply as if the share premium account were paid up share capital of that company, except for certain matters such as:

(i) paying up unissued shares to be issued to members as fully paid bonus shares, (ii) writing off the preliminary expenses of the company or the expenses of, or the commission paid or discount allowed on any issue of shares or debentures of the company, or (iii) providing for the premiums payable on redemption of shares or of any debentures of the company.

The paid up share capital may not be reduced if, on the date the reduction is to be effected, there are reasonable grounds for believing that the company is, or after the reduction would be, unable to pay its liabilities as they become due.

Securities may be offered or sold in Bermuda only in compliance with the provisions of the Investment Business Act 2003 and the Exchange Control Act 1972 and related regulations of Bermuda which regulate the sale of securities in Bermuda.

In addition, the permission of the BMA is required under the provisions of the Exchange Control Act 1972 and related regulations for all issuances and transfers of shares of Bermuda companies to or from a non-resident of Bermuda for exchange control purposes, other than in cases where the BMA has granted a general permission.

The BMA, in its notice to the public dated June

1, 2005, has granted a general permission for the issue and subsequent transfer of any securities of a Bermuda company from and/or to a non-resident of Bermuda for exchange control purposes for so long as any “equity securities” of the company (which would include our common shares) are listed on an “Appointed Stock Exchange” (which would include the NASDAQ Stock Market).

In granting the general permission, the BMA accepts no responsibility for our financial soundness or the correctness of any of the statements made or opinions expressed herein.

We have received consent from the BMA to issue, grant, create, sell and transfer freely any of our shares, stock, bonds, notes (other than promissory notes), debentures, debenture stock, units under a unit trust scheme, shares in an oil royalty, options, warrants, coupons, rights and depository receipts to and among persons who are either resident or non-resident of Bermuda for exchange control purposes.

Economic Substance

Under the Economic Substance Act 2018 and related regulations (collectively, the “ESA”), each entity resident in Bermuda that carries on a “relevant activity” is required to comply with the economic substance requirements under the ESA, unless resident for tax purposes in a jurisdiction outside Bermuda that is not on the European Union (“EU”) list of non-cooperative jurisdictions for tax purposes.

Relevant activities include, inter alia , holding entity activities, as each is defined in the ESA.

Compliance requires that the entity is managed and directed in Bermuda, core income generating activities are undertaken in Bermuda with respect to the relevant activity, the entity maintains adequate physical presence in Bermuda, there are adequate full time employees in Bermuda with suitable qualifications and there is adequate operating expenditure incurred in Bermuda in relation to the relevant activity.

Entities in scope will also need to file an annual declaration form in respect of its relevant activity or activities.

Holding entities are subject to minimum economic substance requirements comprising (in the case of an exempted company), compliance with the corporate governance requirements set forth in the Companies Act and the filing of a declaration form.

The ESA also requires such a holding entity to have adequate people for holding and managing equity participations and have adequate premises in Bermuda.

Any entity that must satisfy economic substance requirements but fails to do so could face automatic disclosure to competent authorities in the EU of the information filed by the entity with the Bermuda Registrar of Companies in connection with the economic substance requirements and may also face financial penalties, restriction or regulation of its business activities and/or may be struck off as a registered entity in Bermuda.

Bermuda Work Permit Considerations

Under Bermuda law, non-Bermudians (other than spouses of Bermudians and individuals holding permanent resident’s certificates) may not engage in any gainful occupation in Bermuda without an appropriate government work permit.

Standard work permits can be obtained for a one-, two-, three-, four- or five-year period.

Where a standard work permit is being applied for, it is a requirement that the job must be advertised for three days (within an eight-day period) in the local newspaper and advertised for eight consecutive days on the Bermuda Government Job Board.

Should no Bermudian (or spouse of a Bermudian or holder of a permanent resident’s certificate) meet the minimum standards as stipulated in the advertisements, the employer may then apply for a standard work permit for the non-Bermudian.

Where such persons apply, employers must complete a Recruitment Disclosure Form, within the Standard Work Permit Application Form, and provide a summary of all applicants that are Bermudian, the spouse of the Bermudian or the holder of a permanent resident’s certificate, including their qualifications and the reason they were unsuccessful.

The Department of Immigration will compare the qualifications and experience of any Bermudian applicants (or spouse of a Bermudian or holder of a permanent resident’s certificate) to that stipulated in the advertisements and to the non-Bermudian to be satisfied that the role could not have been filled by a Bermudian (or spouse of a Bermudian or holder of a permanent resident’s certificate).

In addition to the advertising, there are other documents that are required prior to the Department of Immigration making its decision.

If the position for which the standard work permit is being applied is that of a Chief Executive Officer or other chief officer post, the Minister of Economy and Labour allows an automatic waiver from the requirement to advertise the position and on occasion, after consideration, may waive the requirement to advertise for other senior executive positions upon request.

If an employer wishes to change an employee’s job title, provided that the job description, duties, remuneration and benefits remain unchanged, the employer does not need to advertise or obtain the permission of the Minister of Economy and Labour to do this, but it must inform the Department of Immigration by letter, including the new Statement of Employment, and pay the necessary fee before or after the change has occurred.

If an employer wishes to promote an employee currently on a work permit from his current job to another within the same business, the permission of the Minister of Economy and Labour must first be obtained.

The employer will need to advertise internally and provide evidence of the internal recruitment efforts and consideration of internal Bermudian/spouse of Bermudian candidates.

A temporary work permit can take up to 10 working days to process and a standard work permit takes four weeks to process.

Employers have the right to appeal to the Minister following any decision made by the Board or the Minister.

Appeals should be submitted on letter form to the Department for the attention of the Chief Immigration Officer, made within seven (7) working days of the date of the refusal letter.

Competition for

our fronting business includes but is not limited to State National (part of Markel), Argo Group, Clear Blue, Spinnaker, Trisura, Red Point, Equity Insurance Company, Worth Insurance, and Amtrust.

Insurance Regulation

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insurance subsidiaries are subject to extensive regulation and supervision by their state of domicile, as well as those states in which they do business.

The purpose of such regulation and supervision is primarily to provide safeguards for policyholders, rather than to protect the interests of shareholders.

The insurance laws of the various states establish regulatory agencies with broad administrative powers, including the power to grant or revoke operating licenses and regulate trade practices, investments, premium rates, deposits of securities, the form and content of financial statements and insurance policies, dividend limitations, cancellation and non-renewal of policies, accounting practices and the maintenance of specified reserves and capital for the protection of policyholders.

The payment of dividends by our subsidiaries to us is limited by statute.

In general, the laws and regulations applicable to our domestic insurance subsidiaries limit the aggregate amount of dividends or other distributions that they may declare or pay within any 12 month period without advance regulatory approval.

In Ohio, the domiciliary state of James River Insurance, James River Casualty, Stonewood Insurance and Falls Lake National, the limitation is the greater of statutory net income for the preceding calendar year or 10% of the statutory surplus at the end of the preceding calendar year, provided that such dividends may only be paid out of the earned surplus of each of the companies without obtaining regulatory approvals.

In California, the domiciliary state of Falls Lake Fire and Casualty, this limitation is the greater of statutory net income for the preceding calendar year or 10% of the statutory surplus at the end of the preceding calendar year, provided that such dividends may only be paid out of unassigned surplus without obtaining regulatory approval.

In addition, insurance regulators have broad powers to prevent reduction of statutory surplus to inadequate levels and could refuse to permit the payment of dividends calculated under any applicable formula.

Premium rate regulation varies greatly among jurisdictions and lines of insurance.

In most states in which our subsidiaries write insurance, premium rates for the various lines of insurance are subject to either prior approval or limited review upon implementation.

States require rates for property-casualty insurance that are adequate, not excessive, and not unfairly discriminatory.

Our insurance subsidiaries are required to file quarterly and annual reports with the appropriate regulatory agency in its state of domicile and with The National Association of Insurance Commissioners (“NAIC”) based on applicable statutory regulations, which differ from U.S.

generally accepted accounting principles.

Their business and accounts are subject to examination by such agencies at any time.

Many jurisdictions have laws and regulations that limit an insurer’s ability to withdraw from a particular market.

For example, states may limit an insurer’s ability to cancel or non-renew policies.

Furthermore, certain states prohibit an insurer from withdrawing one or more lines of business from the states, except pursuant to a plan approved by the state insurance department.

Laws and regulations that limit cancellation and non-renewal and that subject program withdrawals to prior approval requirements may restrict our ability to exit unprofitable marketplaces in a timely manner.

We currently have five U.S.

insurance subsidiaries domiciled in two states, Ohio and California.

The purpose of state insurance regulation and supervision is primarily to provide safeguards for policyholders, rather than to protect the interests of shareholders.

The insurance laws of the various states establish regulatory authorities with broad administrative powers, including the power to grant or revoke operating licenses and to regulate corporate governance, trade practices, investments, premium rates, deposits of securities, the form and content of financial statements and insurance policies, dividend limitations, cancellation and non-renewal of policies, accounting practices and the maintenance of specified reserves and capital for the protection of policyholders.

In addition, in the United States, the National Association of Insurance Commissioners (“NAIC”) is a standard-setting and regulatory support organization.

Among other things, the NAIC develops and recommends adoption of model insurance laws and regulations.

Model laws and regulations promulgated by the NAIC become effective in a state only once formally adopted, and may be modified by each state.

Many of the NAIC’s model laws and regulations have been adopted by the insurance regulators in our insurance companies’ states of domicile, as well as the other states in which they do business.

State laws governing insurance holding companies and insurance companies require an insurance holding company and their insurance subsidiaries to register with the insurance department authority, to file certain reports disclosing information, including but not limited to capital structure, ownership, management, and financial condition.

Such holding company laws also impose standards and filing requirements on certain transactions between related companies, which include, among other requirements, that all transactions be fair and reasonable, that an insurer’s surplus as regards policyholders be reasonable and adequate in relation to its liabilities and that expenses and payments be allocated to the appropriate party in accordance with customary accounting practices.

These transactions between related companies include transfers of assets, loans, reinsurance agreements, service agreements, certain dividend payments by the insurance companies and certain other material transactions and modifications to such transactions.

Such holding company laws also impose standards and notice and approval requirements on certain transactions between an insurance company and its affiliates, which include, among other requirements, that all transactions be fair and reasonable, that an insurer’s surplus as regards policyholders be reasonable and adequate in relation to its liabilities and that expenses and payments be allocated to the appropriate party in accordance with customary accounting practices.

These transactions between an insurance company and its affiliates include transfers of assets, loans, reinsurance agreements, service agreements, certain dividend payments by the insurance companies and certain other material transactions and modifications to such transactions.

In 2012, the NAIC adopted significant changes to the insurance holding company act and regulations (the “NAIC Amendments”).

The NAIC Amendments, when adopted by the various states, are designed to respond to perceived gaps in the regulation of insurance holding company systems in the United States.

One of the major changes is a requirement that an insurance holding company system’s ultimate controlling person submit annually to its lead state insurance regulator an “enterprise risk report” that identifies activities, circumstances or events involving one or more affiliates of an insurer that, if not remedied properly, are likely to have a material adverse effect upon the financial condition or liquidity of the insurer or its insurance holding company system as a whole.

Other changes include (i) requiring a controlling person to submit prior notice to its domiciliary insurance regulator of its divestiture of control, (ii) having detailed minimum

requirements for cost sharing and management agreements between an insurer and its affiliates and (iii) expanding the types of agreements between an insurer and its affiliates to be filed with its domiciliary insurance regulator.

The NAIC Amendments must be adopted by a state legislature and such state’s insurance regulator in order to be effective in that state.

The NAIC Amendments were designed to respond to perceived gaps in the regulation of insurance holding company systems in the United States.

They include a requirement that an insurance holding company system’s ultimate controlling person submit annually to its lead state insurance regulator an “enterprise risk report” that identifies activities, circumstances or events involving one or more affiliates of an insurer that, if not remedied properly, are likely to have a material adverse effect upon the financial condition or liquidity of the insurer or its insurance holding company system as a whole.

Each of California and Ohio, the states in which our U.S.

insurance subsidiaries are domiciled, include this enterprise risk report.

In addition, in 2012, the NAIC adopted the Risk Management and Own Risk and Solvency Assessment Model Act (the “ORSA Model Act”).

The ORSA Model Act, when adopted by the various states, requires an insurance holding company system’s Chief Risk Officer to submit at least annually to its lead state insurance regulator an Own Risk and Solvency Assessment Summary Report (“ORSA”).

insurance subsidiaries are domiciled, require this enterprise risk report.

Also in 2012, the NAIC adopted the Risk Management and Own Risk and Solvency Assessment Model Act (the “ORSA Model Act”) which has been adopted by almost all states, including California and Ohio, and requires an insurance holding company system’s Chief Risk Officer to submit at least annually to its lead state insurance regulator an Own Risk and Solvency Assessment Summary Report (“ORSA”).

The ORSA is a confidential internal assessment, appropriate to the nature, scale and complexity of an insurer, of the material and relevant risks identified by the insurer associated with an insurer’s current business plan and the sufficiency of capital resources to support those risks.

The ORSA Model Act must be adopted by a state legislature in order to be effective in that state.

Each of California and Ohio, the states in which our U.S.

insurance subsidiaries are domiciled, adopted and require an ORSA filing.

The insurance holding company laws and regulations of the states in which our insurance companies are domiciled also generally require that before a person can acquire direct or indirect control of an insurer domiciled in the state, and in some cases prior to divesting its control, prior written approval must be obtained from the insurer’s domiciliary state insurance regulator.

As a holding company with no significant business operations of its own, the Company depends on dividends from its subsidiaries to meet its obligations.

As noted above, the payment of dividends by our subsidiaries to us is limited by statute.

In Ohio, the domiciliary state of James River Insurance, James River Casualty, Stonewood Insurance and Falls Lake National, and in California, the domiciliary state of Falls Lake Fire and Casualty, the limitation is the greater of statutory net income for the preceding calendar year or 10% of the statutory surplus at the end of the preceding calendar year.

In addition, in both Ohio and California, dividends may only be paid out of the earned surplus of each of the companies without obtaining regulatory approvals.

Further, insurance regulators have broad powers to prevent reduction of statutory surplus to inadequate levels and could refuse to permit the payment of dividends calculated under any applicable formula.

The insurance holding company laws and regulations of the states in which our insurance companies are domiciled also generally require that before a person can acquire direct or indirect control of an insurer domiciled in the state, and in some cases prior to divesting its control of an insurer domiciled in the state, prior written approval must be obtained from the insurer’s domiciliary state insurance regulator.

These laws discourage potential acquisition proposals and may delay, deter or prevent an investment in or a change of control involving us, or one or more of our regulated subsidiaries, including transactions that our management and some or all of our shareholders might consider desirable.

Pursuant to applicable laws and regulations, “control” over an insurer is generally presumed to exist if any person, directly or indirectly, owns, controls, holds the power to vote or holds proxies representing 10 percent or more of the voting securities of that insurer.

Indirect ownership includes ownership of the Company’s common shares.

Under state insurance guaranty fund laws, insurance companies doing business in a state can be assessed for certain obligations of insolvent insurance companies to such insolvent companies’ policyholders and claimants.

Maximum assessments allowed in any one year generally vary between one percent and two percent of annual premiums written in that state, but it is possible that caps on such assessments could be raised if there are numerous or large insolvencies.

In most states, guaranty fund assessments are recoverable either through future policy surcharges or offsets to state premium tax liabilities.

The admitted market is subject to more state regulation than the E&S market, particularly with regard to rate and form filing requirements, restrictions on the ability to exit lines of business, premium tax payments and membership in various state associations, such as guaranty funds.

Some states have deregulated their commercial insurance markets.

We cannot predict the effect that further deregulation would have on our business, financial condition or results of operations.

Pursuant to applicable laws and

regulations, “control” over an insurer is generally presumed to exist if any person, directly or indirectly, owns, controls, holds the power to vote or holds proxies representing 10 percent or more of the voting securities of that insurer.

Indirect ownership of an insurer includes ownership of the Company’s common stock.

Our insurance subsidiaries are required to file quarterly and annual reports with the insurance regulator in its state of domicile and with the NAIC based on applicable statutory regulations, which differ from U.S.

generally accepted accounting principles.

Their business and accounts are subject to examination by such regulators at any time.

The NAIC has also undertaken an effort to determine whether additional standards and disclosures are required in connection with certain investments of U.S.

insurance companies, particularly in the case of related party investments, structured securities and other complex assets.

The state insurance regulators utilize a risk-based capital model to help assess the capital and surplus adequacy of insurance companies in relation to investment and insurance risks and identify insurers that are in, or are perceived as approaching, financial difficulty.

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Companies having less statutory surplus than required by the risk-based capital requirements are subject to varying degrees of regulatory scrutiny and intervention, depending on the severity of the inadequacy.

At December 31, 2024, the Company’s U.S.-based insurance subsidiaries had total adjusted statutory capital of $643.0 million, which is in excess of the minimum risk-based capital requirement.

In response to the growing threat of cyber-attacks in the insurance industry, certain jurisdictions have begun to consider new cybersecurity measures, including the adoption of cybersecurity laws and regulations which, among other things, would require insurance companies to establish and maintain a cybersecurity program and implement and maintain cybersecurity policies and procedures.

On October 24, 2017, the NAIC adopted its Insurance Data Security Model Law, intended to serve as model legislation for states to enact in order to govern cybersecurity and data protection practices of insurers, insurance agents, and other licensed entities registered under state insurance laws.

In recent years, the NAIC has adopted, or is considering adopting, several changes impacting how RBC is calculated, including initiatives aimed at a comprehensive review of the RBC investment framework, as well as using modeling methodology to determine RBC charges for structured securities.

The NAIC’s work is ongoing and could result in changes to RBC requirements and calculations in the future.

At December 31, 2025, our U.S.-based.

insurance subsidiaries had total adjusted statutory capital of $789.5 million.

Under state insurance guaranty fund laws, insurance companies doing business in a state on an admitted basis can be assessed for certain obligations of insolvent insurance companies to such insolvent companies’ policyholders and claimants.