Palomar Holdings Inc. (PLMR) is accelerating its diversification across property, casualty and specialty lines, pushing first-half earnings growth to 27% year-over-year and prompting management to raise adjusted net income guidance for the third time in 2026. The company, which trades at $136.00 after closing down 0.99%, has posted 15 consecutive earnings beats since its 2019 IPO.
Speaking at the KBW Insurance Conference 2026 in Monte Carlo, President Jon Christianson emphasized that Palomar’s growth is no longer concentrated in a single segment. "We are not just in property, but we're in casualty," Christianson said. "We've built a surety business, a crop insurance business. Really nice and diversified, both on commercial lines, personal lines, admitted, ENS, and really geographic scope throughout the U.S." The company says companywide growth exceeds 20% and return on equity is above 20%.
Crop insurance is a standout. Gross written premium for the line in 2026 is projected to exceed $400 million, up from an earlier target in the $300 million range. Palomar also cut its reinsurance cession for crop from 95% to 50% year-over-year, retaining more of the risk as confidence in underwriting grows. Acreage reports are due in July, with the risk period running through October.
Acquisition momentum continues. Palomar completed its purchase of FIA Surety in early 2025 and closed the acquisition of The Gray Casualty & Surety Company at the end of January 2026. Christianson said the combined platform positions the company to become a top-20 surety writer over a three-to-five-year horizon, with organic growth expected to carry the story over five to ten years.
On the reinsurance side, Palomar expanded its earthquake reinsurance tower from $3 billion to approximately $4 billion and works with more than 100 counterparties. Its California earthquake retention remains at $20 million, a figure Christianson noted is now within a month’s earnings rather than a quarter’s, reflecting tighter risk control. In Hawaii, hurricane retention stands at $1.5 million through the Laulima Exchange. Earthquake insurance penetration in California is estimated at roughly 13%, but Palomar sees the rate climbing closer to 30% following major events, leaving significant total addressable market upside.
Casualty reserving remains a focus. Some 84% of casualty reserves are incurred but not reported, according to the company. Chief Financial Officer Chris Uchida said artificial intelligence adoption is expected to improve top-line performance, loss ratios and other underwriting expenses across the book, though he cautioned that AI would not meaningfully reduce acquisition costs.
"Any one of our P&L owners," Christianson said, "is thinking about how he can do more with the team that he has and continue to grow in a very profitable fashion."
