Skyward/2025/FY/Annual report

This article presents Skyward's FY 2025 annual report — the narrative Items (each summarized into a factsheet), primary financial statements, and note schedules from its SEC Form 10-K.

Document info
Organization	Skyward
Year	2025
Period	FY
Period label	FY25
Document type	Annual report
Document name	Skyward Specialty Insurance Group 2025 Form 10-K
Publication date	2026-03-02
Language	English
Source	Original URL

Cover

USD ($)	12 Months Ended
—	Dec. 31, 2025	Feb. 26, 2026	Jun. 30, 2025
Cover [Abstract]	—	—	—
Document Type	10-K	—	—
Document Annual Report	true	—	—
Document Period End Date	Dec. 31, 2025	—	—
Current Fiscal Year End Date	--12-31	—	—
Document Transition Report	false	—	—
Entity File Number	001-41591	—	—
Entity Registrant Name	SKYWARD SPECIALTY INSURANCE GROUP, INC.	—	—
Entity Incorporation, State or Country Code	DE	—	—
Entity Tax Identification Number	14-1957288	—	—
Entity Address, Address Line One	800 Gessner Road	—	—
Entity Address, Address Line Two	Suite 600	—	—
Entity Address, City or Town	Houston	—	—
Entity Address, State or Province	TX	—	—
Entity Address, Postal Zip Code	77024-4284	—	—
City Area Code	713	—	—
Local Phone Number	935-4800	—	—
Title of 12(b) Security	Common stock, par value $0.01	—	—
Trading Symbol	SKWD	—	—
Security Exchange Name	NASDAQ	—	—
Entity Well-known Seasoned Issuer	No	—	—
Entity Voluntary Filers	No	—	—
Entity Current Reporting Status	No	—	—
Entity Interactive Data Current	Yes	—	—
Entity Filer Category	Large Accelerated Filer	—	—
Entity Small Business	false	—	—
Entity Emerging Growth Company	false	—	—
ICFR Auditor Attestation Flag	true	—	—
Document Financial Statement Error Correction [Flag]	false	—	—
Entity Shell Company	false	—	—
Entity Public Float	—	—	2,165,161,643
Entity Common Stock, Shares Outstanding	—	44,467,084	—
Documents Incorporated by Reference	Portions of the Registrant’s Proxy Statement relating to the 2026 annual meeting of stockholders (the “2026 Proxy Statement”), which will be filed within 120 days of December 31, 2025, are incorporated by reference into Part III of this Form 10-K.	—	—
Entity Central Index Key	0001519449	—	—
Amendment Flag	false	—	—
Document Fiscal Year Focus	2025	—	—
Document Fiscal Period Focus	FY	—	—

Audit Information

	12 Months Ended
—	Dec. 31, 2025
Audit Information [Abstract]	—
Auditor Name	Ernst & Young LLP
Auditor Location	Houston, Texas
Auditor Firm ID	42

Business

Who We Are

• Skyward Specialty was formed as a Delaware corporation on January 3, 2006, as an insurance holding company ^{p. 1}.
• The company operated under the name Houston International Insurance Group, Ltd. until rebranding as Skyward Specialty in November 2020 ^{p. 1}.
• Skyward Specialty is a growing specialty insurance company providing commercial insurance products and solutions on a non-admitted (E&S) and admitted basis, primarily in the United States ^{p. 1}.
• The company focuses on underserved, dislocated, or inadequately covered markets where standard insurance coverages are insufficient ^{p. 1}.
• Customers typically require highly specialized, customized underwriting solutions and claims capabilities ^{p. 1}.
• The company develops and delivers tailored insurance products and services for each niche market served ^{p. 1}.
• The portfolio of insured risks is highly diversified across industries, distribution channels, and lines of business ^{p. 1}.
• Lines of business include general liability, excess liability, professional liability (including cyber and media liability insurance), commercial auto, group accident and health, property, agriculture, credit, surety, and workers’ compensation ^{p. 1}.
• The company insures both short and medium duration liabilities ^{p. 1}.
• The business mix is principally primary insurance and balanced between E&S and admitted markets ^{p. 1}.
• A portion of the business is specialty reinsurance, primarily property, agriculture, and credit ^{p. 1}.
• Specialty reinsurance focuses on attractive specialty classes where approaching through reinsurance is more efficient due to factors like cost of entry and geographic expansion costs ^{p. 1}.
• This diversification, including businesses not typically aligned with traditional P&C pricing cycles, combined with underwriting and claims expertise, aims to consistently produce strong growth and profitability across all insurance pricing cycles ^{p. 1}.
• The company is led by an entrepreneurial executive management team with decades of insurance leadership experience in the global P&C industry ^{p. 1}.
• The leadership is supported by an experienced team with broad skill sets aligned with the company's strategy ^{p. 1}.
• High-quality leadership, underwriting and claims teams, technology DNA, advanced analytics capabilities, diversified book of business, and strong competitive position in chosen market niches are believed to position the company for continued profitable growth ^{p. 1}.
• The company aims to deliver long-term value for shareholders by generating best-in-class underwriting profitability and book value per share growth across P&C market cycles ^{p. 1}.
• All insurance company subsidiaries are group rated and have financial strength ratings of "A" (Excellent) from A.M. Best Company, with a stable outlook ^{p. 1}.

Apollo Acquisition

• On September 2, 2025, the company entered into two share purchase agreements (the "Apollo Majority SPAs") with institutional and management shareholders of Apollo Group Holdings Limited ("Apollo") (the "Majority Sellers") ^{p. 2}.
• Pursuant to the Apollo Majority SPAs, the company agreed to acquire all issued shares of Apollo held by the Majority Sellers, representing approximately 87% of Apollo's issued share capital ^{p. 2}.
• Closing of the transaction ("Closing") was conditioned upon the company acquiring 100% of Apollo's issued share capital (the “Acquisition”) at Closing through additional short-form share purchase agreements (the "Apollo Minority SPAs") with the remaining minority shareholders (the "Minority Sellers") ^{p. 2}.
• The Acquisition closed on January 1, 2026 ^{p. 2}.
• The consideration for the transaction was satisfied by issuing common stock of the Company to certain sellers and the remainder in cash ^{p. 2}.
• Apollo is a U.S.-centric specialty underwriting platform operating at Lloyd’s of London, characterized by low volatility, high growth, and a capital-light business model ^{p. 2}.
• Apollo's gross written premium has grown consistently since its formation in 2010 ^{p. 2}.
• Through Syndicate 1969, Apollo underwrites a multi-class specialty insurance portfolio ^{p. 2}.
• Through Syndicate 1971, Apollo provides a platform liability product for the digital and sharing economy ^{p. 2}.
• Apollo provides capital to syndicates 1969 and 1971 in exchange for a pro-rata share of underwriting income, with third parties providing the remaining capital ^{p. 2}.
• Apollo earns managing agency fees and profit commissions for being the managing agent to its own syndicates and to third-party syndicates (platform partners) ^{p. 2}.
• The acquisition aligns with Skyward Specialty’s strategy by introducing new specialty niches, a distinctive new economy offering, accelerating innovation, and adding Apollo’s advanced technology capabilities ^{p. 2}.
• David Ibeson will continue as CEO of Apollo, leading Apollo's growth as a subsidiary of Skyward Specialty, along with Apollo’s management team ^{p. 2}.

Our Business and Our Strategy

• The company operates with one reportable segment, offering a broad range of insurance coverages across various market niches ^{p. 3}.
• Nine distinct underwriting divisions exist, each with dedicated leadership and technical staff experienced in their niches ^{p. 3}.
• This structure aims to effectively serve customers, partner with distributors, and achieve attractive risk-adjusted returns ^{p. 3}.
• For the year ended December 31, 2025, gross written premiums were 41% admitted and 59% non-admitted ^{p. 3}.
• Accident & Health (A&H) underwriting division provides medical stop loss to self-insured employers and covers group and single-employer captives ^{p. 3}.
• A&H captives program offers tailored medical stop-loss and reinsurance solutions with dedicated underwriting and claims oversight ^{p. 3}.
• The A&H division targets small and medium-sized enterprises seeking to control healthcare costs by self-insuring ^{p. 3}.
• A&H products are written on an admitted basis and distributed through retail and wholesale brokers ^{p. 3}.
• Agriculture and Credit (Re)insurance underwriting division provides specialty risk-transfer solutions across a global portfolio ^{p. 3}.
• This portfolio includes agriculture, dairy and livestock revenue protection, and mortgage and credit product lines ^{p. 3}.
• The division supports insurers, MGAs, and other risk originators with tailored treaty protection using proportional and excess of loss structures ^{p. 3}.
• Global agriculture book covers weather and natural peril volatility, production, and yield risks to manage catastrophe exposure and seasonal earnings variability ^{p. 3}.
• Mortgage portfolio supports government-sponsored entities and private mortgage insurers against default and loss severity volatility due to macroeconomic stress, structured to manage tail risk ^{p. 3}.
• Credit portfolio protects against losses from default risk for single obligors and multi-buyer trade credit across diverse regions and industries ^{p. 3}.
• Dairy and livestock business provides producers with revenue protection against price volatility in milk, cattle, and hog markets ^{p. 3}.
• Derivative instruments, primarily put options and futures, are used to mitigate commodity price risk related to cattle, hog, and milk prices ^{p. 3}.
• These instruments are used solely for managing adverse price movements, with positions adjusted throughout the year ^{p. 3}.
• Captives underwriting division offers group captive solutions by leveraging underwriting and claims expertise from other divisions ^{p. 3}.
• This division writes property, general liability, commercial auto, excess liability, and workers’ compensation on E&S and admitted bases ^{p. 3}.
• Business is often administered through partnerships with third-party captive managers ^{p. 3}.
• Construction & Energy Solutions underwriting division focuses on high-severity exposures with tailored multi-line solutions ^{p. 3}.
• Solutions include general liability, excess liability, commercial auto, and workers’ compensation ^{p. 3}.
• Products are distributed through retail agents, brokers, and a select network of wholesalers ^{p. 3}.
• Global Property underwriting division provides comprehensive property insurance and reinsurance for commercial clients worldwide ^{p. 3}.
• Offerings protect against physical loss or damage to assets from natural catastrophes and other insured perils ^{p. 3}.
• Professional Lines underwriting division includes three units: management liability, professional liability (including cyber), and allied health (including life sciences) ^{p. 3}.
• Management/Professional liability and allied health provide primary and excess claims-made liability products ^{p. 3}.
• These products are offered on E&S and admitted bases, distributed through wholesale and retail brokers ^{p. 3}.
• Specialty Programs underwriting division partners with program administrators focused on specific markets ^{p. 3}.
• This partnership model is used to participate profitably or extend reach in certain markets, leveraging administrators' competitive advantages like scale or proprietary technology ^{p. 3}.
• Specialty Programs writes property, general liability, commercial auto liability, excess liability, and workers’ compensation on E&S and admitted bases ^{p. 3}.
• Surety underwriting division provides contract, commercial, and transactional surety solutions ^{p. 3}.
• Focus is on small to medium-sized enterprises with aggregate bond programs up to approximately $100.0 million for contract and $125.0 million for commercial and transactional ^{p. 3}.
• This business is written on an admitted basis and distributed through retail agents and brokers ^{p. 3}.
• Transactional E&S underwriting division provides primary and excess non-catastrophe prone property and general liability solutions ^{p. 3}.
• Emphasis is on hard-to-place risks due to complexity, loss history, or limited operating history (e.g., startups) ^{p. 3}.
• Success in this market relies on technical underwriting, thoughtful coverage, pricing, and high-quality broker service ^{p. 3}.
• Access to the market in this division is exclusively through wholesale brokers ^{p. 3}.
• The company has "exited business" units and lines that were previously exited and placed into run-off ^{p. 3}.
• The company's strategy is to lead in chosen market niches and establish sustainable, competitive positions ^{p. 3}.
• Key elements of the strategy include:
  • Providing differentiated products, services, and solutions ^{p. 3}.
  • Attracting and retaining exceptional underwriting and claims talent ^{p. 3}.
  • Amplifying expertise with advanced technology and analytics for risk selection, pricing, and claims management ^{p. 3}.
  • Empowering underwriting and claims teams with decision-making authority ^{p. 3}.
  • Fostering a culture of nimbleness and responsiveness to market opportunities ^{p. 3}.
• This strategy is referred to as "Rule Our Niche" and aims to build a strong defensible market position and competitive moat ^{p. 3}.
• The principles of this strategy are considered key to achieving and sustaining best-in-class underwriting results through P&C insurance pricing cycles ^{p. 3}.
• The company strives for excellence in risk selection, pricing, and claims outcomes, amplified by advanced technology and analytics ^{p. 3}.

Our Competitive Strengths

• The company focuses on profitable niches in the market that require technical underwriting and claims management, which act as barriers to entry ^{p. 4}.
• The selected niche areas within commercial lines P&C markets are considered attractive for generating risk-adjusted returns ^{p. 4}.
• The company targets underserved, dislocated markets or those where standard products are insufficient for customer needs ^{p. 4}.
• Risks in core markets require efficient, individual underwriting to achieve sustainable underwriting profit ^{p. 4}.
• The company builds underwriting divisions with deeply experienced underwriters who have appropriate authority for decision-making ^{p. 4}.
• This structure allows for innovative products and solutions for distribution partners and customers, even for challenging risks ^{p. 4}.
• Underwriters' experience is augmented with data and predictive analytics to differentiate risk selection and pricing while enhancing efficiency ^{p. 4}.
• The company hires and retains underwriting and technical staff for their expertise and experience ^{p. 4}.
• Underwriting teams are knowledgeable, experienced, and empowered, which is crucial for operating in markets with risks difficult to automate ^{p. 4}.
• The company avoids strict underwriting rules, allowing professionals to use their expertise and judgment in evaluating and pricing risks ^{p. 4}.
• The company has a specialized team of claims professionals knowledgeable in the niches and lines of business served ^{p. 4}.
• Claims professionals address first-party claims with fair solutions and third-party claims with comprehensive responses, aiming for consistent and early loss recognition of indemnity and loss adjustment expenses (LAE) ^{p. 4}.
• The company responds quickly to claims with specialized adjusters using expertise, advanced technology, and analytics ^{p. 4}.
• Technology is deeply embedded in the claims process, from first notice of loss to investigation and settlement ^{p. 4}.
• Analytics capabilities provide senior leadership and claims teams with real-time, detailed information on open claims and benchmarks against closed claims ^{p. 4}.
• SkyBI, the business intelligence platform, provides real-time intelligence to senior leadership and technical teams for decision-making ^{p. 4}.
• SkyBI incorporates best practices from the management team's experience in P&C insurance and technology sectors ^{p. 4}.
• SkyBI is a single, comprehensive enterprise-wide data repository for reporting, business intelligence, analytics, and advanced data capabilities ^{p. 4}.
• SkyBI provides information and performance metrics across the company in a visualized format ^{p. 4}.
• Data in SkyBI can be filtered by categories such as distributor, customer segment, line of business, industry, underwriter, and risk feature ^{p. 4}.
• The company believes that new types of risk data and advanced technology can augment underwriting and claims decisions ^{p. 4}.
• Underwriting decisions are supported by historical data and in-depth risk evaluation from data collection and processing capabilities ^{p. 4}.
• Underwriting and claims capabilities are amplified by combining historical data with new forms of risk data and predictive analytics ^{p. 4}.
• Generative artificial intelligence is used in underwriting and claims handling to enhance effectiveness and efficiency, while still relying on employee expertise ^{p. 4}.
• The company has built a diversified group of underwriting divisions across multiple product lines, industries, geographies, and distribution channels ^{p. 4}.
• This diversification includes business not typically aligned with traditional P&C cycles ^{p. 4}.
• The company aims to adapt to the market by growing certain lines in favorable conditions and limiting exposure in less favorable conditions ^{p. 4}.
• The diversity of the book allows the company to respond to and capitalize on market opportunities and dislocations across insurance market and pricing cycles ^{p. 4}.
• The company has a distinctive culture, evidenced by internal surveys, public information (Glassdoor, LinkedIn), and selection as a "Best Places to Work in Insurance" ^{p. 4}.
• The culture and operating approach feature a flat communication and decision-making structure ^{p. 4}.
• Staff are trusted to make decisions that achieve or exceed financial results and are supported by a clear performance measurement system ^{p. 4}.
• The company adopted a hybrid work schedule, offering flexibility for remote working ^{p. 4}.
• The company maintains an entrepreneurial environment that encourages and rewards a proactive approach to market disruption ^{p. 4}.
• This environment aligns with the company's identity as a specialty insurer and supports attracting talent and delivering best-in-class results ^{p. 4}.
• The leadership team, led by Chairman and CEO Andrew Robinson, is experienced, innovative, and entrepreneurial ^{p. 4}.
• The executive leadership team has a track record of success in senior management roles at industry-leading P&C companies and in building new businesses ^{p. 4}.
• Senior leadership compensation is structured to align with shareholders ^{p. 4}.
• A material portion of each leader's compensation is in long-term and short-term incentives tied to delivering sustainable, best-in-class underwriting returns ^{p. 4}.
• Executive leadership has additional long-term incentive targets directly tied to growth in book value per share ^{p. 4}.

Our Strategy in Action

• The company's "Rule Our Niche" strategy aims to generate best-in-class underwriting profitability within its niches and create superior long-term shareholder value through growth in book value per share ^{p. 5}.
• Core tenets of the "Rule Our Niche" strategy include attracting and retaining blue-chip underwriting and claims talent to expand and enhance market position ^{p. 5}.
• The company seeks to hire and retain technical underwriting professionals with long-standing industry relationships and claims professionals with expertise in specific niches ^{p. 5}.
• These relationships are crucial for consistent access to preferred business ^{p. 5}.
• The company aims to grow its market position by recruiting world-class talent in chosen markets ^{p. 5}.
• Another tenet is leveraging technology DNA to differentiate from competitors ^{p. 5}.
• The company has demonstrated an ability to use new forms of risk data and advanced technology in complex, higher-severity risk categories within the specialty P&C insurance market ^{p. 5}.
• SkyBI enables prompt sensing and quick response to market changes ^{p. 5}.
• Core operating platforms allow efficient entry into new markets without complex or burdensome systems ^{p. 5}.
• The company believes its technological advantage supports profitable growth and expansion into additional specialty market niches ^{p. 5}.
• The strategy also includes profitably growing existing lines of business and expanding with new underwriting divisions ^{p. 5}.
• The company is positioned to capitalize on trends impacting customers in the U.S. and globally, such as increased demand for specialized insurance due to rising and complex risks ^{p. 5}.
• These risks include climate change/severe weather, supply chain uncertainty, financial inflation, cyber risk, novel health risks, increased litigation, attorney involvement, jury awards, and healthcare delivery/cost ^{p. 5}.
• Another notable market trend is the emergence of "micro cycles and micro dislocations" where different P&C insurance market segments experience hardening and softening at varying times ^{p. 5}.
• The company has reacted quickly to these trends by launching new underwriting units (many not aligned with P&C cycles), entering underserved markets, partnering on advanced technology, and launching new captive solutions ^{p. 5}.
• Gross written premium growth and profitability indicate momentum and position the company for continued expansion and growth ^{p. 5}.
• Differentiating on daily excellence to drive best-in-class underwriting performance is also a core tenet ^{p. 5}.
• Meeting long-term goals, including best-in-class underwriting returns and book value per share growth, depends on execution of day-to-day operations across all functional departments (underwriting, product management, claims management) ^{p. 5}.
• SkyBI provides a foundation for senior management to monitor performance, including renewal rates, new business pricing, portfolio performance for underwriters, and claims aging/reserving practices for adjusters ^{p. 5}.
• Focus on fundamentals driving underwriting excellence is central to the strategy ^{p. 5}.
• Cross-functional collaboration ensures regular review of performance and trends by underwriting, claims, actuarial, and product management teams to implement portfolio, pricing, and coverage changes quickly ^{p. 5}.
• The company aims to use its balance sheet to capture a larger market share ^{p. 5}.
• The company is committed to maintaining a strong balance sheet, starting with conservative loss reserves and strong capitalization ratios ^{p. 5}.
• This commitment is considered imperative for maintaining confidence among customers, distribution partners, reinsurers, regulators, rating agencies, and shareholders ^{p. 5}.
• Claims case reserve practices aim to reserve to the expected ultimate loss within 90 days of the first notice of loss ^{p. 5}.
• The company's practice is to maintain incurred but not reported reserves (IBNR) that, combined with case reserves, are above the actuarial central estimate ^{p. 5}.
• Loss reserves represent the company's best estimate of ultimate losses ^{p. 5}.

Marketing and Distribution

• The company's marketing and distribution approach mirrors its underwriting strategy and is central to its "Rule Our Niche" strategy ^{p. 6}.
• Underwriting teams and the company maintain strong relationships and reputations with distribution partners, facilitating new affiliations ^{p. 6}.
• The company attributes its success with distribution partners to deep expertise in niche markets, high-caliber underwriters, a culture of innovation, thoughtful product lineup and design, and responsive service ^{p. 6}.
• All underwriting divisions dedicate significant effort to maintaining and expanding distribution partner loyalty and long-term relationships ^{p. 6}.
• The company tailors its choice of distribution partners to access specific business, similar to how it tailors underwriting to insureds' needs ^{p. 6}.
• Products are distributed through retail agents, wholesale brokers, select program administrators, and captive managers ^{p. 6}.
• This distribution approach enables effective and efficient access to targeted business based on market niche needs and dynamics ^{p. 6}.

Underwriting

• The company's underwriting approach is central to its "Rule Our Niche" strategy and market success ^{p. 7}.
• Within its nine divisions, the company further specializes underwriting teams to focus on specific niches ^{p. 7}.
• The underwriting approach relies on hiring highly experienced, best-in-class, and diverse teams of technical underwriters with proven track records in specific specialty niche markets ^{p. 7}.
• Underwriters' skills are enhanced with advanced technology and data analytics, and they are empowered with appropriate decision-making authority ^{p. 7}.
• This approach aims for superior risk selection and pricing, leading to sustainable best-in-class underwriting results across market cycles ^{p. 7}.
• The company augments underwriting capabilities using new forms of data and analytics for risk selection and pricing ^{p. 7}.
• Underwriting data is captured in the business intelligence platform, SkyBI, which serves as a comprehensive data repository for reporting, analytics, and other data capabilities ^{p. 7}.
• SkyBI is a key tool for senior management and business leaders ^{p. 7}.
• The company is highly selective in binding policies ^{p. 7}.
• Underwriters are encouraged to move on from opportunities quickly if they cannot reasonably expect to bind coverage at premium and terms meeting company standards ^{p. 7}.
• When accepting risks, the company establishes terms and prices suited to the underlying exposure ^{p. 7}.
• In the admitted market, the company ensures approved forms and filed rates are appropriate and adequate for accepted risks, while allowing flexibility for specific or unique exposures ^{p. 7}.
• In the E&S market, the company uses freedom of rate and form to match risk and coverage to the unique needs and exposures of that market ^{p. 7}.
• Policies are crafted to offer affordable and appropriate protection for insureds' exposures, with coverage structured to make potential losses more predictable and claims costs manageable ^{p. 7}.
• Underwriting teams receive support and collaboration from Claims, Actuarial, Product Management, Legal and Compliance, and Finance departments ^{p. 7}.
• This collaboration ensures timely analysis and action on trends in business, legal and tort developments, and competitor and regulatory actions ^{p. 7}.
• Underwriters are considered central to the company, with all support functions incentivized and measured to achieve underwriting profitability targets ^{p. 7}.
• This structure helps identify opportunities and issues early, contributing to the company's nimbleness and ability to leverage market disruptions ^{p. 7}.
• Underwriting controls and procedures are regularly reviewed to ensure underwriters profitably underwrite in each market served ^{p. 7}.

Claims Management

• Skyward's claims department operates under six guiding principles: prompt and comprehensive investigations using advanced analytics and technology; quality claims handling and customer engagement; timely establishment of reserves based on best estimates; effective pursuit of contribution and subrogation; detection and prevention of fraud; and disciplined litigation management for superior legal defense and cost monitoring ^{p. 8}.
• Continuous training is provided to claim staff on claim evaluation, strategy, litigation management, good-faith claims handling, and best practices to achieve timely and optimal claim outcomes ^{p. 8}.
• The majority of claims are handled in-house ^{p. 8}.
• Third Party Administrators (TPAs) are utilized for specific instances such as programs, captives, occupational accident, workers' compensation, and runoff claims ^{p. 8}.
• TPAs are actively managed, overseen, and regularly audited to ensure compliance with Skyward's claims handling and reserving guidelines and best practices ^{p. 8}.
• Independent legal counsel is retained for liability claims against insureds when warranted, selected based on geographical location and expertise ^{p. 8}.
• Litigation guidelines have been developed for claims professionals and outside counsel to ensure appropriate defense for insureds ^{p. 8}.
• A legal spend management solution is used to analyze legal invoices for adherence to case handling and billing practice standards, ensuring reasonable and customary legal costs ^{p. 8}.
• Technology is leveraged for efficiencies in claims handling, including a Claims Development Severity Predictor model ^{p. 8}.
• The Claims Development Severity Predictor identifies claims likely to lead to large loss development, enabling early identification, proactive management, and summarization of development reasons ^{p. 8}.
• This predictive model is integrated into the claims review and management workflow ^{p. 8}.
• A "quick strike" program has been implemented for commercial auto claims, deploying experienced investigators and vendors to accident scenes within two hours, regardless of location ^{p. 8}.
• The quick strike program assists in evaluating accident facts and circumstances and resolving third-party claims quickly ^{p. 8}.
• Claims handlers and managers are organized by line of business to ensure specialized expertise ^{p. 8}.
• Managers and adjusters collaborate closely with underwriting partners to inform them of legal trends and emerging claims issues, educating underwriters on loss experience for risk selection ^{p. 8}.

Technology

• Technology is central to Skyward Specialty Insurance Group's operations and decision-making, aiming for long-term competitive advantages ^{p. 9}.
• SkyBI, the business intelligence platform, provides real-time intelligence to senior leadership and technical teams for decision-making ^{p. 9}.
• SkyBI incorporates best practices from the management team's experience in P&C insurance and technology sectors ^{p. 9}.
• SkyBI is a single, comprehensive enterprise-wide data repository for reporting, business intelligence, analytics, and advanced data capabilities ^{p. 9}.
• SkyBI presents information and performance metrics across the company in a visualized format ^{p. 9}.
• Data in SkyBI can be filtered by categories such as distributor, customer segment, line of business, industry, underwriter, and risk feature ^{p. 9}.
• SkyBI helps establish clear objectives and facilitates decision-making ^{p. 9}.
• Predictive analytics technology augments employee capabilities using new risk data and predictive analytics, including AI, for risk selection, pricing, and claims handling ^{p. 9}.
• Underwriting divisions intentionally "Rule Our Niche" through constant innovation tailored to specific divisions/markets ^{p. 9}.
• Core transactional platforms, including policy administration, underwriting workbench, billing, and claims systems, are designed for nimble scaling and business expansion ^{p. 9}.
• The company generally uses customized third-party vendor core operating applications ^{p. 9}.
• The core platform organization is used for all business except accident & health, global property, agriculture, credit (re)insurance, and surety, which require dedicated processing components due to their unique features ^{p. 9}.
• Data from all divisions' core operating platforms flows to SkyBI with comparable quality and granularity ^{p. 9}.
• Advanced technology for underwriting and claims, SkyBI, and core operating platforms create a flywheel effect, enabling underwriters to better select risk, claims professionals to adjudicate claims, unit leaders to communicate with partners, and senior leadership to evaluate business trends ^{p. 9}.
• These tools also improve communication with distribution partners, reinsurers, and other third-party partners ^{p. 9}.
• The company faces external threats to its information technology systems, including system failure, data theft attempts, and ransomware attacks ^{p. 9}.
• The technology infrastructure is designed to function through major disruptions ^{p. 9}.
• Data is replicated in real-time to a third-party cloud disaster recovery site for major system failures ^{p. 9}.
• Data is backed up daily for system restoration ^{p. 9}.
• Actions to prevent system and data disruptions include:
  • Actively monitoring Cybersecurity and Infrastructure Security Agency’s (“CISA”) cybersecurity directives and taking immediate action on identified vulnerabilities ^{p. 9}.
  • Conducting monthly vulnerability scans on all network-attached devices at all locations, with patching as needed ^{p. 9}.
  • Requiring two-factor authentication for system access ^{p. 9}.
  • Conducting monthly security training for all employees ^{p. 9}.
  • Implementing endpoint detection agents for threat detection and response ^{p. 9}.
  • Performing desktop scenarios to practice breach responses with cybersecurity insurance partners and retained security consultants ^{p. 9}.
  • Performing annual penetration testing ^{p. 9}.
• The company constantly reviews its security breach posture and regularly implements updated processes, best practices, and tools ^{p. 9}.

Reinsurance

• The company strategically purchases reinsurance from third parties to protect capital from severity events (large single event losses or catastrophes) and reduce earnings volatility ^{p. 10}.
• Reinsurance contracts are predominantly one year in length and renew annually, primarily in January and June ^{p. 10}.
• Annual renewal considerations for reinsurance purchases include changes to underlying insurance coverage, updated loss activity, capital and surplus levels, changes in risk appetite, and the cost and availability of reinsurance treaties ^{p. 10}.
• The company purchases quota share, excess of loss, and facultative reinsurance coverage to limit exposure from losses on any one occurrence ^{p. 10}.
• The mix of reinsurance purchased is based on efficiency, cost, risk appetite, and specific factors of the underlying risks underwritten ^{p. 10}.
• Quota share reinsurance involves a reinsurer assuming a specified percentage of losses from a defined class of business in exchange for a corresponding percentage of premiums, net of a ceding commission ^{p. 10}.
• Excess of loss reinsurance involves a reinsurer assuming all or a portion of losses for an individual claim or event above a specified amount, in exchange for a negotiated premium, and includes the catastrophe reinsurance program ^{p. 10}.
• Facultative coverage is a reinsurance contract for individual risks, used to supplement treaty limits or cover risks/perils excluded from treaty reinsurance ^{p. 10}.
• As of December 31, 2025, property insurance represented 34% of gross written premiums ^{p. 10}.
• The company actively manages and monitors property writings by geographic area to limit potential loss aggregation from severe events like hurricanes, convective storms, and earthquakes ^{p. 10}.
• Catastrophe reinsurance is purchased to further mitigate property loss aggregation due to single or series of events ^{p. 10}.
• Third-party stochastic and proprietary deterministic models are used to analyze the risk of loss aggregation from such events and inform catastrophe reinsurance purchases ^{p. 10}.
• These models provide a quantitative view of PML (Probable Maximum Loss) events, which estimate the expected loss level for a given return period ^{p. 10}.
• Based on modeling, an event beyond a 1 in 250-year PML would be required to exhaust the company's $36.0 million property catastrophe coverage ^{p. 10}.
• The company aims to expose no more than 3.0% of stockholders’ equity to a catastrophic loss that is less than a 1 in 250-year event ^{p. 10}.
• The current reinsurance program is believed to provide coverage well in excess of theoretical losses from any recorded historical event ^{p. 10}.
• The company seeks to purchase reinsurance from reinsurers rated at least "A-" ("Excellent") or better by A.M. Best ^{p. 10}.
• As of December 31, 2025, 98% of reinsurance recoverables were from reinsurers rated "A-" (Excellent) or better by A.M. Best, or were collateralized ^{p. 10}.
• The company retains primary liability to policyholders if reinsurers fail to pay claims, leading to potential losses ^{p. 10}.
• Allowances for uncollectible reinsurance are established due to the risk of reinsurer default ^{p. 10}.
• The allowance for uncollectible reinsurance was $2.3 million at December 31, 2025, and 2024 ^{p. 10}.

Reinsurance (1)(footnote: Legal defense expenses can force exposure above the maximum company retention for Excess Casualty, Commercial Auto and General Liability.) (2)(footnote: Reinsurance is subject to a loss ratio cap or aggregate level of loss cover that exceeds a modeled 1:250-year PML event.) (3)(footnote: Catastrophe loss protection is purchased up to $36.0 million in excess of $12.0 million retention, which provides cover for a 1:250-year PML event.)

Line of Business	Maximum Company Retention
Accident & Health	$0.90 million per occurrence
Commercial Auto (1)	$1.00 million per occurrence
Excess Casualty (1)(2)	$2.25 million per occurrence
General Liability (1)	$1.50 million per occurrence
Ocean Marine (2)	$3.00 million per occurrence
Professional Lines (2)	$5.25 million per occurrence
Property (3)	$3.50 million per occurrence
Representation and Warranty	$3.25 million per occurrence
Surety (2)	$5.00 million per occurrence
Workers’ Compensation (2)	$2.33 million per occurrence

Reinsurance (1)(footnote: This reinsurer facilitates our eMaxx captive. At December 31, 2025, we held collateral in a statutory trust of $235.2 million on our net reinsurance recoverables.)

($ in thousands)
Reinsurer	Reinsurance Recoverables	AM Best Rating
eMaxx Capitves (1)	197,989	n/r
Everest Reinsurance Co.	123,925	A+
General Reinsurance Corp	70,355	A++
Partner Reinsurance Co. of the US	65,446	A+
ACE (Chubb Property & Casulty Ins Company)	48,344	A+
RGA Reinsurance Company	43,043	A+
Lloyds Syndicate 4711	35,860	A+
Swiss Reinsurance America Corp	26,152	A+
Lloyds Syndicate 2987	25,301	A+
Aspen Insurance UK Limited	24,715	A
Top 10 Total	661,130	—
All Others	458,750	—
Total	1,119,880	—

Enterprise Risk Management

• ERM is embedded in nearly every aspect of the company and guides day-to-day activities ^{p. 11}.
• ERM approach aims to ensure an acceptable risk-adjusted return for shareholders while maintaining trust and reliability for those served ^{p. 11}.
• Underwriting and asset portfolio construction are intentional ^{p. 11}.
• Liability duration and market cyclicality of the underwriting portfolio are balanced ^{p. 11}.
• Reinsurance is used to manage volatility outside of risk tolerances ^{p. 11}.
• Investment strategy targets a diversified portfolio that balances yield, liquidity, volatility, and potential for principal loss ^{p. 11}.
• SVP, CFO & Head of ERM - US Operations oversees critical ERM processes and chairs the cross-functional corporate ERM Committee ^{p. 11}.
• Economic Capital Model (ECM) formalizes the company's view of risk and solvency in terms of potential economic loss ^{p. 11}.
• ECM output measures potential earnings and capital loss for various scenarios ^{p. 11}.
• Risk tolerances are set and updated annually by the ERM Committee and discussed with the Risk Committee of the Board of Directors ^{p. 11}.
• ECM provides a probabilistic modeled view of earnings and capital loss, integrating potential losses from catastrophes, reserving, underwriting, market, credit risk, strategic, and operational risks ^{p. 11}.
• SVP, CFO & Head of ERM works with the ERM Committee to review and maintain a comprehensive risk register with accountabilities for mitigations ^{p. 11}.
• Top 10 risks are identified, quantified by the SVP, CFO & Head of ERM and ERM Committee, and reviewed quarterly ^{p. 11}.
• Reports on top risks are submitted to the Risk Committee regularly by the SVP, CFO & Head of ERM and the ERM Committee ^{p. 11}.
• Operational processes and controls are constructed to identify, assess, and manage key risks continuously ^{p. 11}.
• Underwriting Committee oversees changes in risk appetite, product line, and division expansion ^{p. 11}.
• Claims department monitors handling practices against guidelines via regular internal audits, conducts monthly large loss reviews, and maintains a watchlist for potential high severity claims ^{p. 11}.
• Actuarial department performs quarterly reserve studies ^{p. 11}.
• Reserve Committee meets quarterly to review and respond to trends in loss emergence ^{p. 11}.
• Key observations from the Reserve Committee are discussed with the CEO ^{p. 11}.
• Underwriting divisions assess rate change and retention on existing business, new business quality, pricing adequacy, and loss emergence compared to expectations on a monthly and quarterly basis ^{p. 11}.
• SkyBI platform provides real-time portfolio, underwriting, claims, and actuarial analytics ^{p. 11}.
• ERM is central to decision-making and daily activities ^{p. 11}.
• ERM is a central component of the strategy to achieve market-leading risk-adjusted returns for shareholders and reinforce a culture of accountability, transparency, and sound judgment ^{p. 11}.

Reserves

• Reserves are maintained for specific claims incurred and reported, IBNR reserves, and uncollectible reinsurance ^{p. 12}.
• The ultimate liability may differ from current reserves, and there is a risk of inadequate reserves in the insurance industry ^{p. 12}.
• Reserves are continually monitored using new information on reported claims and statistical analyses ^{p. 12}.
• Anticipated inflation is implicitly reflected in the reserving process through cost trend analysis and historical development review ^{p. 12}.
• Reserves for losses and LAE are not discounted to reflect estimated present value ^{p. 12}.
• Upon claim reporting, a case reserve is established for the estimated ultimate payment after assessing coverage, damages, and investigation ^{p. 12}.
• Case reserve estimates are based on reserving practices and the claims adjuster's experience and knowledge of the claim type and value ^{p. 12}.
• Case reserves are revised periodically based on subsequent developments for each claim ^{p. 12}.
• IBNR reserves are established for the estimated amount of future loss payments on incurred but not yet reported claims, and for potential development on reported claims ^{p. 12}.
• IBNR reserves are estimated using generally accepted actuarial reserving techniques that consider quantitative loss experience data and qualitative factors ^{p. 12}.
• Loss reserves are regularly reviewed using various actuarial techniques ^{p. 12}.
• Reserve estimates are updated as historical loss experience develops, additional claims are reported/settled, and new information becomes available ^{p. 12}.
• Reserves can be increased or decreased over time as claims move towards settlement, impacting earnings through adverse development or reserve releases ^{p. 12}.
• Additional information on loss reserves is available in Item 7 of Form 10-K, "Management’s Discussion and Analysis of Financial Condition and Results of Operations - “Results of Operations - Losses and LAE” and “Critical Accounting Policies” ^{p. 12}.

Investments

• The company aims to maintain a balanced investment portfolio primarily consisting of investments that provide predictable and stable returns ^{p. 13}.
• The portfolio is augmented by strategic investments chosen for attractive risk-adjusted returns ^{p. 13}.
• The investment allocation strategy uses an Enterprise Based Asset Allocation model ^{p. 13}.
• This model is integrated into the Economic Capital Model, as discussed in Item 1 (ERM discussion) ^{p. 13}.
• The model helps understand the impact of investment allocation decisions on capital, liquidity, and risk profile across various market scenarios ^{p. 13}.
• The company actively manages and monitors investment risk to balance stable growth and liquidity with compliance to insurance regulatory and rating agency frameworks ^{p. 13}.
• The portfolio mainly consists of cash and cash equivalents and investment-grade fixed-maturity securities ^{p. 13}.
• Additional investments are included if they fit the company's risk appetite ^{p. 13}.
• The Investment Committee of the Board of Directors reviews and approves the investment policy and strategy ^{p. 13}.
• This committee meets quarterly to review investment activities, tactics, and new investment opportunities ^{p. 13}.
• The portfolio is directed internally and includes both self-managed investments and portfolios managed by select third-party investment management firms ^{p. 13}.
• For further discussion on investments, including market risks, refer to Item 7 of Form 10-K, "Management’s Discussion and Analysis of Financial Condition and Results of Operations—Investments" ^{p. 13}.

Competition

• The specialty lines property & casualty insurance market comprises numerous markets and sub-markets ^{p. 14}.
• Each market has distinct customer needs, products, services, and specific economic and structural features ^{p. 14}.
• Competition in underwriting divisions comes from other specialty and standard insurers, as well as program administrators ^{p. 14}.
• Competition factors include pricing, general reputation, perceived financial strength, broker relationships, product terms and conditions, independent rating agency ratings, speed and reputation of claims payment, and the experience and reputation of underwriting and claims teams ^{p. 14}.
• Due to the diversity of underwriting divisions, competition is broad, with some competitors specific to only a subset of divisions ^{p. 14}.
• Notable competitors include Markel Corporation, W.R. Berkley Corporation, American Financial Group Inc., Tokio Marine Holdings, Inc., CNA Financial Corporation, Hiscox, Ltd., RLI Corp., Intact Finance Corporation, Kinsale Capital Group, Inc., Arch Capital Group, and AXIS Capital Holdings, Ltd. ^{p. 14}.

Our Structure

• Operations are conducted principally through four insurance companies: Great Midwest Insurance Company (GMIC), Houston Specialty Company (HSIC), Imperium Insurance Company (IIC), and Oklahoma Specialty Insurance Company (OSIC) ^{p. 15}.
• GMIC, the largest insurance subsidiary, underwrites multiple lines of insurance on an admitted basis in all 50 states and the District of Columbia ^{p. 15}.
• GMIC is a certified surety bond company listed with the Department of the Treasury ^{p. 15}.
• HSIC, a subsidiary of GMIC, underwrites multiple lines of insurance on a surplus lines basis in 50 states, the District of Columbia, and select foreign countries ^{p. 15}.
• IIC, a subsidiary of HSIC, underwrites on an admitted basis in all 50 states and the District of Columbia ^{p. 15}.
• OSIC, a subsidiary of IIC, is an approved surplus lines company in 49 states and the District of Columbia ^{p. 15}.
• Effective December 31, 2024, the insurance company subsidiaries were restacked into the current organizational structure ^{p. 15}.
• This restacking provided the growing surety business with the capital needed to operate more effectively within the surety T-listing market ^{p. 15}.
• Skyward Re is a wholly-owned captive reinsurance company domiciled in the Cayman Islands ^{p. 15}.
• Skyward Re was incorporated on January 7, 2020 ^{p. 15}.
• Skyward Re was established to facilitate the LPT, which was commuted effective January 31, 2025 ^{p. 15}.
• Three non-insurance companies are also operated: Skyward Underwriters Agency, Inc., Skyward Service Company, and Skyward Specialty No. 1 Limited Company ^{p. 15}.
• Skyward Underwriters Agency, Inc. is a licensed agent, managing general agent, and reinsurance broker ^{p. 15}.
• Skyward Service Company provides various administrative services to the subsidiaries ^{p. 15}.
• Skyward Specialty No. 1 Limited Company is a UK company and an authorized Lloyd’s corporate member ^{p. 15}.
• The organizational structure at December 31, 2025, shows each entity is wholly-owned by its immediate parent ^{p. 15}.
• Skyward Specialty Insurance Group, Inc. (Delaware corporation) is the parent company ^{p. 15}.
• Skyward Specialty Insurance Group, Inc. has direct relationships with Skyward Service Company (Delaware corporation), Great Midwest Insurance Company (Texas stock insurance company), Skyward Underwriters Agency, Inc. (Texas corporation), Skyward Specialty No. 1 Limited (United Kingdom company), and Skyward Re (Cayman Islands corporation) ^{p. 15}.
• Great Midwest Insurance Company has a direct relationship with Houston Specialty Insurance Company (Texas stock insurance company) ^{p. 15}.
• Houston Specialty Insurance Company has a direct relationship with Imperium Insurance Company (Texas stock insurance company) ^{p. 15}.
• Imperium Insurance Company has a direct relationship with Oklahoma Specialty Insurance Company (Oklahoma insurance corporation) ^{p. 15}.

Our Structure

—	2025
Texas	10.7%
Pennsylvania	7.6
Florida	7.2
California	7.1
New York	6.3
Louisiana	6.1
Illinois	4.1
New Jersey	4.1
Georgia	3.8
Delaware	3.1
All other states and countries	39.9
Total	100.0%

Our Structure

Ratings

• Skyward Specialty Insurance Group, Inc. has an "A" (Excellent) rating with a stable outlook from A.M. Best ^{p. 16}.
• A.M. Best rates insurance companies based on factors relevant to policyholders ^{p. 16}.
• A.M. Best assigns 13 ratings, ranging from "A++" (Superior) to "D" (Poor) ^{p. 16}.
• The "A" (Excellent) rating is the third highest rating assigned by A.M. Best ^{p. 16}.
• A.M. Best's evaluation includes profitability, leverage, liquidity, book of business, reinsurance adequacy, asset quality and market value, adequacy of losses and loss expense reserves, surplus adequacy, capital structure, management experience and competence, and market presence ^{p. 16}.
• A.M. Best's ratings reflect its opinion on an insurance company’s financial strength, operating performance, and ability to meet policyholder obligations ^{p. 16}.
• Ratings are based on factors relevant to policyholders, agents, insurance brokers, and intermediaries, and are not specifically related to securities issued by the company ^{p. 16}.

Regulation

• The company is regulated by insurance regulatory authorities in the states where it conducts business ^{p. 17}.
• State insurance laws and regulations primarily protect policyholders, consumers, and claimants, not stockholders or other investors ^{p. 17}.
• The nature and extent of state regulation varies by jurisdiction ^{p. 17}.
• State insurance regulators have broad administrative power over:
  • Setting capital and surplus requirements ^{p. 17}.
  • Licensing of insurers and insurance producers ^{p. 17}.
  • Review and approval of product forms and rates ^{p. 17}.
  • Establishing standards for reserve adequacy ^{p. 17}.
  • Prescribing statutory accounting methods and the form/content of statutory financial reports ^{p. 17}.
  • Regulating certain transactions with affiliates ^{p. 17}.
  • Prescribing types and amounts of investments ^{p. 17}.
• Insurance company regulation is constantly changing due to governmental agency and legislative reactions to issues ^{p. 17}.
• Some state legislatures have considered or enacted laws that increase state authority to regulate insurance companies and holding company systems, often as a protection against federal involvement ^{p. 17}.
• The National Association of Insurance Commissioners ("NAIC") and some state insurance regulators are re-examining existing laws and regulations, focusing on solvency issues, interpretations of laws, and development of new laws ^{p. 17}.
• The federal government does not directly regulate the business of insurance, but federal initiatives can affect the industry through treatment of federal subsidiaries, regulation of quasi-governmental entities, and regulations from federal departments ^{p. 17}.
• The company operates as an insurance holding company system ^{p. 17}.
• The company is subject to insurance holding company laws in Texas, where its primary insurance companies are domiciled, and Oklahoma ^{p. 17}.
• These statutes require each insurance company in the system to register with the insurance department of its state of domicile ^{p. 17}.
• Registration involves furnishing information about operations of companies within the holding company system that may materially affect the operations, management, or financial condition of domiciled insurers ^{p. 17}.
• All transactions among members of a holding company system must be fair and reasonable ^{p. 17}.
• Transactions between insurance subsidiaries and their parents/affiliates generally must be disclosed to state regulators ^{p. 17}.
• Notice to or prior approval from the applicable state insurance regulator is generally required for any material or extraordinary transaction ^{p. 17}.

Intellectual Property

• The company has applied for various trademark registrations in the United States at both federal and state levels ^{p. 18}.
• The company plans to pursue additional trademark registrations and other intellectual property protection if deemed beneficial and cost-effective ^{p. 18}.
• The company monitors its trademarks and service marks and protects them from unauthorized use as necessary ^{p. 18}.

Employees and Human Capital

• As of December 31, 2025, the company had approximately 611 employees ^{p. 19}.
• Employees are not subject to any collective bargaining agreement, and there are no known current efforts to implement such an agreement ^{p. 19}.
• The company believes it has good working relations with its employees ^{p. 19}.
• The company aims to be an employer of choice, fostering a culture committed to diversity of thought, background, and perspective ^{p. 19}.
• The company strives to cultivate an exceptional workforce to perpetuate its ownership culture and achieve superior business results ^{p. 19}.
• The company's goal is to attract, develop, and retain diverse talent, promoting a culture where different viewpoints are valued, and individuals feel respected, treated fairly, and have opportunities to excel ^{p. 19}.
• The company offers a competitive benefits package including medical, dental, and vision insurance, a 401(k) plan, paid time off, family leave, employee assistance programs, and an employee stock purchase plan ^{p. 19}.
• The company emphasizes employee training and development, providing opportunities for further education and professional development ^{p. 19}.

Risk Factors

• Investing in the company's common stock carries a high degree of risk ^{p. 20}.
• Investors should carefully consider the risks and uncertainties described in the report, including consolidated financial statements and related notes, and other SEC filings, before investing ^{p. 20}.
• The listed risks and uncertainties are not exhaustive; additional unstated, unknown, or currently immaterial risks may also affect the company ^{p. 20}.
• The occurrence of any identified risk could materially harm the company's business, operating results, financial condition, and prospects ^{p. 20}.
• Such events could lead to a decline in the common stock price, potentially resulting in a loss of part or all of an investment ^{p. 20}.

Summary of Material Risk Factors

• Financial condition and results of operations could be materially adversely affected by inaccurate assessment of underwriting risk ^{p. 21}.
• Competition in the industry is intense ^{p. 21}.
• Reliance on distribution channels (insurance retail agents and brokers, wholesalers, program administrators) exposes the business to certain risks ^{p. 21}.
• Inability to purchase third-party reinsurance on commercially acceptable terms or terms that adequately protect the company may materially adversely affect business, financial condition, and results of operations ^{p. 21}.
• Losses and loss expense reserves may be inadequate to cover actual losses, materially adversely affecting financial condition, results of operations, and cash flows ^{p. 21}.
• Decline in financial strength rating may adversely affect the amount of business written ^{p. 21}.
• Unexpected changes in interpretation of coverage or provisions (including loss limitations and exclusions) in policies could materially adversely affect financial condition and results of operations ^{p. 21}.
• Reinsurers may not reimburse claims on a timely basis or at all, which may materially adversely affect business, financial condition, and results of operations ^{p. 21}.
• Failure to accurately and timely pay claims could materially and adversely affect business, financial condition, results of operations, and prospects ^{p. 21}.
• Adverse economic factors (recession, inflation, high unemployment, lower economic activity) could lead to fewer policy sales, increased claim frequency, premium defaults, or falsification of claims, impacting growth and profitability ^{p. 21}.
• Insurance business is cyclical, which may affect financial performance and cause operating results to vary quarter-to-quarter, not indicative of future performance ^{p. 21}.
• Extensive regulation may adversely affect the ability to achieve business objectives; non-compliance could result in penalties (fines, suspensions) adversely affecting financial condition and results of operations ^{p. 21}.
• Loss of key personnel or inability to attract and retain qualified personnel could adversely affect the company ^{p. 21}.
• Failure to achieve and maintain effective internal controls could impact operating results and financial condition, and negatively affect the market price of common stock ^{p. 21}.
• Costs will increase significantly as a public company, requiring substantial management time for compliance ^{p. 21}.
• Use of derivatives to mitigate market price volatility exposure may subject the company to risks such as hedge ineffectiveness, basis risk, collateral and margin call liquidity pressures, and valuation uncertainty, which could adversely affect financial condition ^{p. 21}.
• Integration of Apollo may present unforeseen challenges, including difficulties with technology systems, business processes, and risk management frameworks, potentially causing operational disruptions, increased costs, or delays in realizing anticipated strategic benefits ^{p. 21}.

Risks Related to Our Business and Industry

• Underwriting success depends on accurately assessing risks and establishing appropriate premium rates; misunderstanding risks or employee decisions exposing the company to risk could adversely affect financial results ^{p. 22}.
• Competition in the insurance industry is intense, coming from other specialty and standard insurance companies, and underwriting agencies ^{p. 22}.
• Competition factors include price, reputation, financial strength, distribution partner relationships, product terms, independent rating agency ratings, claims payment speed, and underwriting team experience ^{p. 22}.
• Industry consolidation has increased competition and new industry/legislative developments could further intensify it ^{p. 22}.
• Increased competition could change supply and demand for insurance, affect pricing at risk-adequate rates, impact retention of existing business, or hinder underwriting new business on favorable terms, adversely affecting operating results ^{p. 22}.
• Reliance on distribution channels (retail agents, brokers, wholesalers, program administrators) exposes the company to risks ^{p. 22}.
• Product distribution is primarily through independent retail agents and brokers who own "renewal rights," making the business model dependent on these relationships ^{p. 22}.
• Relationships with distributors can be discontinued or become unprofitable; consolidation of distribution firms may increase their influence on commission rates and business concentration ^{p. 22}.
• Credit risk is associated with brokers who collect premiums but may not remit them, potentially requiring the company to provide coverage without receiving payment ^{p. 22}.
• Financial condition of new brokers is reviewed before transacting business, and existing distributors are periodically reviewed for profitability and alignment with business objectives ^{p. 22}.
• Deterioration in distributor relationships or uncompetitive compensation could lead distributors to place more premium with other carriers ^{p. 22}.
• Distributor actions such as exceeding authority, failing to transfer collected premiums, or breaching obligations could expose the company to liability ^{p. 22}.
• Consolidation of insurance distribution firms could negatively affect sales channels through loss of market access, market share, talent, or increased commission costs due to greater negotiating leverage ^{p. 22}.
• Digitization risks include distributors' inability to provide technology-driven experiences, potentially leading to customer loss to more technologically advanced competitors ^{p. 22}.
• Inability to purchase third-party reinsurance on desired or commercially acceptable terms could materially adversely affect the business ^{p. 22}.
• Reinsurance protects capital from severity events and reduces earnings volatility by ceding risk ^{p. 22}.
• Failure to renew or secure new reinsurance on acceptable terms could increase loss exposure, potentially requiring a reduction in underwriting commitments ^{p. 22}.
• Reinsurers may exclude coverages or alter terms, leading to gaps in reinsurance protection and greater potential losses for the company ^{p. 22}.
• Inadequate loss and loss expense reserves could materially adversely affect financial condition, results of operations, and cash flows ^{p. 22}.
• Reserves are estimates of ultimate claim settlement and administration costs, not exact calculations, and actual liability may differ ^{p. 22}.
• Factors reviewed for reserving include claims inflation, claims development patterns, pricing, legislative activity, social/economic patterns, and litigation/regulatory trends ^{p. 22}.
• Variables affecting loss exposure are internal and external, requiring continuous monitoring of loss reserves using new information and statistical techniques ^{p. 22}.
• Uncertainties impacting reserve adequacy include the time to fully assess covered losses, retroactive enforcement of new liability theories, and financial market volatility leading to increased claims or severity ^{p. 22}.
• Elevated inflationary conditions would increase loss costs ^{p. 22}.
• Adverse economic factors (recession, inflation, high unemployment) could reduce policy sales or increase claim frequency/severity and premium defaults ^{p. 22}.
• Increased cost due to "social inflation" (medical/material costs, technology in vehicles, supply chain disruptions, attorney involvement, litigation financing, lawsuit abuse) could increase claim frequency/severity and affect reserve adequacy ^{p. 22}.
• Increased claim frequency could escalate evaluation and handling costs beyond established reserves, especially in new lines of business or due to new claim theories ^{p. 22}.
• Inadequate reserves would require increases, reducing net income and stockholders' equity in the period of identification ^{p. 22}.
• Future loss experience substantially exceeding reserves could materially adversely affect future earnings, liquidity, and financial rating ^{p. 22}.
• A decline in financial strength rating may adversely affect the amount of business written ^{p. 22}.
• Independent ratings agencies (e.g., A.M. Best) assess financial strength and quality of insurers ^{p. 22}.
• A.M. Best ratings range from "A++" (Superior) to "F" (liquidation) ^{p. 22}.
• A.M. Best financial strength rating for the company is "A" (Excellent) with a stable outlook as of the filing date ^{p. 22}.
• A.M. Best's analysis includes balance sheet strength, operating performance, business profile, comparisons to peers, industry standards, operating plans, philosophy, and management ^{p. 22}.
• Factors that could lead to a rating downgrade include changes in business practices, unfavorable financial/regulatory/market trends, losses exceeding reserves, unresolved issues with regulators, inability to retain key personnel, investment portfolio losses, or changes in A.M. Best's capital adequacy assessment methodology ^{p. 22}.
• A rating downgrade or withdrawal could cause distribution partners and insureds to choose competitors, increase reinsurance costs or reduce availability, or limit/prevent writing new/renewal insurance contracts ^{p. 22}.
• Increased scrutiny by rating organizations due to financial pressures in the industry could lead to adverse ratings consequences ^{p. 22}.
• Unexpected changes in interpretation of coverage or policy provisions (including loss limitations and exclusions) could materially adversely affect financial condition and results ^{p. 22}.
• Loss limitations or exclusions in policies may not be enforceable as intended due to changing industry practices, legal, judicial, or social conditions ^{p. 22}.
• Courts or regulatory authorities could nullify limitations/exclusions, or legislation could modify/bar their use, leading to higher than anticipated losses and LAE ^{p. 22}.
• Court decisions (e.g., 1995 Montrose decision in California) could narrowly interpret exclusions, expanding coverage and requiring new exclusions ^{p. 22}.
• These issues could broaden coverage beyond underwriting intent or increase claim frequency/severity, with the full extent of liability potentially unknown for years ^{p. 22}.
• Reinsurers may not reimburse claims timely or at all, materially adversely affecting the business ^{p. 22}.
• Reinsurance contracts require premium payments to reinsurers who reimburse for covered policy claims, often years later ^{p. 22}.
• Reinsurance does not relieve the ceding insurer of primary liability to policyholders ^{p. 22}.
• Reinsurers may default due to insolvency, liquidity issues, operational failure, political/regulatory prohibitions, fraud, or disputes over agreement wordings, leading to increased net losses ^{p. 22}.
• Reinsurance recoverables totaled USD 1,119.9 million as of December 31, 2025 ^{p. 22}.
• Failure to accurately and timely pay claims could materially and adversely affect business, financial condition, results of operations, and prospects ^{p. 22}.
• Factors affecting claim payment ability include staff training/experience, management effectiveness, and appropriate procedures/systems ^{p. 22}.
• Ineffective management of TPAs or internal staff's inability to handle claim volume could adversely affect workload capacity and claims quality, impacting operating margins ^{p. 22}.
• Severe weather conditions, catastrophes, pandemics, and man-made events may adversely affect business ^{p. 22}.
• Catastrophes include natural events (winter weather, storms, earthquakes, fires) and man-made events (explosions, war, terrorist attacks) ^{p. 22}.
• Changing weather patterns and climatic conditions (e.g., global warming) increase unpredictability and frequency of natural disasters, including in new areas ^{p. 22}.
• Climate change may increase frequency and severity of extreme weather events, such as hurricanes and wildfires ^{p. 22}.
• Catastrophes can indirectly impact the business even if not directly insured against, such as the 2025 California wildfires leading to policy cancellations ^{p. 22}.
• Increased frequency and severity of weather events could materially affect the ability to predict, quantify, reinsure, and manage catastrophe risk, increasing losses ^{p. 22}.
• Losses from catastrophes depend on frequency, severity, and insured exposure in affected areas ^{p. 22}.
• Inability to obtain reinsurance coverage at reasonable rates for severe weather and catastrophes could materially adversely affect business ^{p. 22}.
• Pandemics, outbreaks, public health crises, and geopolitical/social events expose the business to risk ^{p. 22}.
• Policy terms are expected to preclude coverage for virus-related claims, but court decisions or governmental actions may challenge exclusions ^{p. 22}.
• Changes in climate policy programs and legislation could have a material adverse effect on business ^{p. 22}.
• Program administrators with quoting and binding authority, if non-compliant with guidelines, could bind the company to unanticipated risks, adversely affecting results ^{p. 22}.
• Failure of actual renewals or new business from repeat insureds to meet expectations could materially adversely affect future written premium and results ^{p. 22}.
• Most contracts are one-year term and renewable; some insureds are repeat customers with new contracts ^{p. 22}.
• Assumptions about renewal rates and repeat business are made in financial forecasting ^{p. 22}.
• Cyclical nature of insurance industry with intense price-based competition can impact renewal rates ^{p. 22}.
• Increased public attention to ESG matters may lead to negative public perception, reputational harm, additional costs, or stock price impact ^{p. 22}.
• Failure to meet ESG expectations or backlash against ESG topics could harm business and reputation ^{p. 22}.
• Damage to reputation from providing policies to certain insureds could decrease demand, materially adversely affect business, and require resources to rebuild ^{p. 22}.
• Changes in accounting practices and future pronouncements may materially affect reported financial results, requiring additional expenses for compliance ^{p. 22}.
• Impact of accounting changes cannot be predicted but may affect net income, shareholder's equity, and other financial statement items ^{p. 22}.
• Insurance subsidiaries must comply with statutory accounting principles (SAP), which are constantly reviewed by the NAIC and state insurance departments ^{p. 22}.
• Pending proposals before NAIC committees could negatively affect insurance industry participants if enacted ^{p. 22}.
• Use of derivatives to mitigate market price volatility exposes the company to risks like hedge ineffectiveness, basis risk, collateral/margin call liquidity pressures, and valuation uncertainty ^{p. 22}.
• These risks could prevent hedging strategies from effectively reducing volatility and materially adversely impact financial results ^{p. 22}.

Risks Related to the Market and Economic Conditions

• Adverse economic factors like recession, inflation, high unemployment, or lower economic activity can reduce policy sales, increase claim frequency, lead to premium defaults, or cause claim falsification, impacting growth and profitability ^{p. 23}.
• Business revenue, economic conditions, capital market volatility, and inflation affect the business and economic environment, influencing the ability to generate revenue and profits ^{p. 23}.
• An economic downturn with higher unemployment, declining spending, and reduced corporate revenue generally negatively affects demand for insurance products, impacting premium levels and profitability ^{p. 23}.
• Negative economic factors can hinder the ability to charge appropriate rates for insured risks and adversely affect the number of policies written and opportunities for profitable underwriting ^{p. 23}.
• During an economic downturn, customers may reduce insurance needs, cancel policies, modify coverage, or not renew policies ^{p. 23}.
• Existing policyholders might exaggerate or falsify claims to receive higher payments in an economic downturn ^{p. 23}.
• A significant collapse in economic segments like construction, credit markets, or energy production/servicing could adversely affect results across multiple underwriting divisions ^{p. 23}.
• These outcomes would reduce underwriting profit if not reflected in the rates charged ^{p. 23}.
• The insurance business is historically cyclical, which can affect financial performance and cause operating results to vary quarterly, not necessarily indicating future performance ^{p. 23}.
• Insurance carriers have historically experienced significant fluctuations in operating results due to competition, catastrophic events, capacity levels, litigation trends, regulatory constraints, and general economic conditions ^{p. 23}.
• The supply of insurance is linked to prevailing prices, insured losses, and industry capital levels, which fluctuate with investment returns in the insurance industry ^{p. 23}.
• The insurance industry is cyclical, characterized by periods of intense price competition due to excessive underwriting capacity (soft market) and periods of capacity shortages increasing premiums (hard market) ^{p. 23}.
• Demand for insurance depends on factors such as frequency and severity of catastrophic events, capacity levels, new capital providers, and general economic conditions, all of which fluctuate and can contribute to price declines ^{p. 23}.
• The profitability of most P&C insurance companies tends to follow this cyclical market pattern, with higher gross written premium growth and improved profitability during hard market cycles ^{p. 23}.
• This cyclical market pattern can be more pronounced in the E&S market than in the standard insurance market ^{p. 23}.
• When the standard insurance market hardens, the E&S market typically hardens, and E&S market growth can be significantly more rapid ^{p. 23}.
• When market conditions soften, customers previously in the E&S market may return to the admitted market, exacerbating the effects of rate decreases on financial results ^{p. 23}.
• The market may experience "micro cycles" where specific areas harden or soften independently and potentially more drastically than the overall market ^{p. 23}.
• Operating results are subject to fluctuation and have historically varied quarter-to-quarter ^{p. 23}.
• Quarterly results are expected to continue fluctuating due to general economic conditions, frequency/severity of catastrophe events, fluctuating interest rates, claims exceeding loss reserves, industry competition, deviations from expected premium retention, adverse investment performance, and reinsurance coverage costs ^{p. 23}.
• Investment portfolio performance is subject to various investment risks that may adversely affect financial results ^{p. 23}.
• The company aims to hold a diversified investment portfolio managed by professional advisory firms according to its investment policy and reviewed by the Investment Committee ^{p. 23}.
• Investments are subject to general economic conditions, market risks, and risks inherent to specific securities ^{p. 23}.
• Primary market risk exposures are to changes in interest rates and equity prices ^{p. 23}.
• A significant portion of the investment portfolio is in fixed maturity securities, or separately managed accounts and limited partnerships primarily invested in fixed maturity securities ^{p. 23}.
• Interest rates rose materially during 2022 and 2023 ^{p. 23}.
• A low interest rate environment, potentially resulting from federal government actions to slow inflation (e.g., rate cuts, Inflation Reduction Act of 2022), would pressure net investment income, particularly for fixed maturity securities and short-term investments, adversely affecting operating results ^{p. 23}.
• Recent and future interest rate increases could cause declines in the value of fixed income securities portfolios, with the magnitude depending on security duration and the extent of rate increases ^{p. 23}.
• Some fixed income securities with call or prepayment options create reinvestment risk in declining rate environments ^{p. 23}.
• Mortgage-backed and other asset-backed securities carry prepayment risk or may not prepay as quickly as expected in a rising interest rate environment ^{p. 23}.
• All fixed maturity securities, including those in separately managed accounts and limited partnerships, are subject to credit risk ^{p. 23}.
• Credit risk is the risk of investment default or impairment due to deterioration in the financial condition of issuers or insurers guaranteeing payments ^{p. 23}.
• Downgrades in credit ratings of fixed maturity securities could significantly negatively affect their market valuation ^{p. 23}.
• The company also invests in marketable preferred and common equity securities and exchange-traded funds, which are carried at fair market value and are subject to potential losses and market value declines ^{p. 23}.
• Market and credit risks could reduce net investment income and result in realized investment losses ^{p. 23}.
• The investment portfolio is subject to increased valuation uncertainties when investment markets are illiquid, as with fixed maturity securities held to maturity, separately managed accounts, and limited partnership investments ^{p. 23}.
• Valuation of investments is more subjective in illiquid markets, increasing the risk that estimated fair value does not reflect actual transaction prices ^{p. 23}.
• Risks for all security types are managed through an investment policy that establishes parameters, including maximum percentages in certain security types and minimum credit quality levels, believed to be within NAIC, Texas Department of Insurance, and Oklahoma Department of Insurance guidelines ^{p. 23}.
• The Investment Committee periodically reviews Enterprise Based Asset Allocation models for overall risk management ^{p. 23}.
• While seeking to preserve capital, there is no certainty that investment objectives will be achieved, and results may vary substantially over time ^{p. 23}.
• Investment strategies aim not to correlate with insurance and reinsurance exposures, but investment losses may occur concurrently with underwriting losses, exacerbating their adverse effect ^{p. 23}.
• The company could be forced to sell investments to meet liquidity requirements ^{p. 23}.
• Premiums received from insureds are invested until needed to pay policyholder claims ^{p. 23}.
• The duration of the investment portfolio is managed based on the duration of losses and LAE reserves to provide sufficient liquidity and avoid liquidating investments to fund claims ^{p. 23}.
• Risks such as inadequate losses and LAE reserves or unfavorable litigation trends could necessitate selling investments to fund liabilities ^{p. 23}.
• The company may not be able to sell investments at favorable prices or at all ^{p. 23}.
• Sales could result in significant realized losses depending on general market conditions, interest rates, and credit issues with individual securities ^{p. 23}.

Risks Related to the Regulatory Environment

• The company is subject to extensive regulation, and non-compliance can lead to penalties like fines and suspensions, adversely affecting financial condition and results of operations ^{p. 24}.
• Primary insurance subsidiaries (GMIC, HSIC, IIC) are extensively regulated in Texas, their state of domicile, and to a lesser degree in other operating states ^{p. 24}.
• Most insurance regulations protect policyholders' interests, not investors' or stockholders' ^{p. 24}.
• State insurance departments administer regulations covering capital and surplus, investment and underwriting limitations, affiliate transactions, dividend limitations, changes in control, solvency, and other financial/non-financial aspects ^{p. 24}.
• Significant changes in laws and regulations could limit discretion or increase business costs ^{p. 24}.
• State insurance regulators conduct periodic examinations and require annual/other reports on financial condition and holding company issues ^{p. 24}.
• Regulatory requirements may impose timing and expense constraints, affecting the achievement of business objectives ^{p. 24}.
• Insurance subsidiaries are part of an "insurance holding company system" under Texas statutes and regulations ^{p. 24}.
• Certain transactions between insurance subsidiaries and affiliates require prior notice to the Texas Department of Insurance, potentially causing business delays and additional expenses ^{p. 24}.
• Failure to file required notifications or comply with Texas insurance regulations could result in significant fines, penalties, and impaired working relationships with the Texas Department of Insurance ^{p. 24}.
• State insurance regulators have broad discretion to deny or revoke licenses for regulation violations ^{p. 24}.
• The company follows practices based on its interpretations of regulations or industry practices, which may differ from regulatory authorities' interpretations ^{p. 24}.
• Lack of requisite licenses/approvals or non-compliance could lead to regulators precluding or suspending activities or imposing penalties, adversely affecting business operations ^{p. 24}.
• Changes in insurance industry regulation, laws, or interpretations could interfere with operations and increase compliance costs ^{p. 24}.
• Insurance subsidiaries are subject to risk-based capital requirements based on the NAIC model and other minimum capital/surplus restrictions under Texas law ^{p. 24}.
• These requirements establish minimum risk-based capital to support overall business operations and identify inadequately capitalized property and casualty insurers based on asset/liability risks and net written premium mix ^{p. 24}.
• Falling below a calculated threshold can lead to regulatory actions, including supervision, rehabilitation, or liquidation ^{p. 24}.
• Failure to maintain required risk-based capital levels could adversely affect the insurance subsidiary's ability to maintain regulatory authority and its A.M. Best Rating ^{p. 24}.
• The company may become subject to additional government or market regulation, potentially having a material adverse impact on its business ^{p. 24}.
• Business could be adversely affected by changes in laws related to asset/reserve valuation, surplus, investment/dividend limitations, enterprise risk, and risk-based capital ^{p. 24}.
• The U.S. federal government, which generally has not directly regulated the insurance industry except for flood, nuclear, and terrorism risks, could consider legislation affecting the industry in areas like privatization of government entities (Freddie Mac, Fannie Mae), reduction in federal subsidies (agriculture), tort reform, corporate governance, and taxation of reinsurance companies ^{p. 24}.
• Changes to U.S. tax laws and new tax policies could negatively impact the overall economy and the company's business ^{p. 24}.
• Legislative or other tax actions could negatively affect the company, its investments, or stockholders ^{p. 24}.
• The rules for U.S. federal income taxation are constantly under review by legislators, the IRS, and the U.S. Department of the Treasury ^{p. 24}.
• The company cannot predict the impact of tax law changes on itself, stockholders, or portfolio investments ^{p. 24}.
• New legislation, U.S. Treasury regulations, administrative interpretations, or court decisions could have adverse consequences ^{p. 24}.
• On July 4, 2025, H.R. 1, the "One Big Beautiful Bill Act" (OBBBA), was signed into law in the United States ^{p. 24}.
• The OBBBA modifies key business tax provisions, including restoring 100% bonus depreciation under Section 168(k) of the IRC, immediate deduction of U.S. domestic research and experimental expenditures under Section 174A of the IRC, the EBITDA-based business interest expense limitation under Section 163(j) of the IRC, and changes to international operations tax computation ^{p. 24}.
• Based on current analysis, the company does not believe OBBBA provisions will materially impact its business or results of operations ^{p. 24}.
• Regulations and other IRS guidance implementing the OBBBA may create unforeseen issues, and further tax law changes may occur ^{p. 24}.
• There is no assurance that the company's business will not be adversely affected by the OBBBA or other tax law changes ^{p. 24}.
• The company's ability to utilize net operating loss carryforwards (NOLs) and other tax attributes may be limited ^{p. 24}.
• As of December 31, 2025, the company had gross federal income tax NOLs of approximately $40.3 million available to offset future taxable income, prior to Section 382 limitations ^{p. 24}.
• These NOLs are set to expire starting in 2032 ^{p. 24}.
• Under Section 382 of the Code, an "ownership change" (greater than 50% change in equity ownership by certain stockholders over a rolling three-year period) can limit the use of pre-ownership change NOLs to offset post-ownership change income ^{p. 24}.
• Future ownership changes due to shifts in stock ownership, some outside the company's control, may occur ^{p. 24}.
• Future regulatory changes could also limit the ability to utilize NOLs ^{p. 24}.
• Inability to offset future taxable income with NOLs could adversely affect net income and cash flows ^{p. 24}.
• As a holding company with substantially all operations conducted by insurance subsidiaries, the company's liquidity, dividend payment ability, and debt servicing depend on cash dividends or permitted payments from insurance subsidiaries ^{p. 24}.
• Continued operation and growth require substantial capital ^{p. 24}.
• The company does not intend to declare and pay cash dividends on common stock in the foreseeable future ^{p. 24}.
• The ability to pay dividends to stockholders and meet debt obligations largely depends on dividends and distributions from primary insurance subsidiaries (GMIC, HSIC, IIC) ^{p. 24}.
• State insurance laws, including Texas laws, restrict the ability of GMIC, HSIC, and IIC to determine stockholder dividends ^{p. 24}.
• State insurance regulators require insurance companies to maintain specified levels of statutory capital and surplus ^{p. 24}.
• Dividend payments are limited to the portion of available policyholder surplus derived from net profits ^{p. 24}.
• State insurance regulators have broad powers to prevent statutory surplus reduction to inadequate levels, and there is no assurance that maximum calculated dividends would be permitted ^{p. 24}.
• State insurance regulators may adopt more restrictive statutory provisions regarding dividend payments in the future ^{p. 24}.
• Any future dividend determination will be at the discretion of the Board of Directors, based on results, financial condition, contractual restrictions, indebtedness, applicable law, and other relevant factors ^{p. 24}.
• Investors may need to sell common stock after price appreciation, which may not occur, to realize gains, as immediate cash dividends are not expected ^{p. 24}.
• Applicable insurance laws may make a change of control difficult ^{p. 24}.
• Under Texas insurance laws, acquiring control of a domestic insurer requires written approval from the state insurance commissioner ^{p. 24}.
• Approval depends on factors including the acquirer's financial strength, plans for the insurer's future operations, and potential anti-competitive results ^{p. 24}.
• Texas insurance laws apply to direct and indirect acquisition of 10% or more of the voting stock of a Texas-domiciled insurer ^{p. 24}.
• Acquiring 10% or more of the company's common stock would be considered an indirect change of control, triggering filing requirements under Texas insurance laws, unless a disclaimer of control filing is accepted by the Texas Insurance Department ^{p. 24}.
• These requirements may discourage acquisition proposals and delay, deter, or prevent a change of control, even if desirable to some stockholders ^{p. 24}.

Risks Related to Our Liquidity and Access to Capital

• Future capital requirements depend on factors such as the ability to write new business successfully and establish adequate premium rates and reserves to cover losses ^{p. 25}.
• If cash flows from operations are insufficient, or if the capital position is negatively impacted by investment portfolio declines, catastrophe losses, or adverse reserve development, additional funds may be needed through financings or growth curtailment ^{p. 25}.
• Capital needs are affected by growth rate, profitability, claims experience, reinsurance availability, market disruptions, and other unforeseeable developments ^{p. 25}.
• Equity or debt financing may not be available on favorable terms, or at all, potentially leading to dilution for stockholders or restrictive covenants in debt financings ^{p. 25}.
• Securities issued for financing may have rights, preferences, and privileges senior to common stock ^{p. 25}.
• Inability to obtain adequate capital on favorable terms could materially adversely affect operating plans, business, financial condition, or results of operations ^{p. 25}.
• Access to credit under the Revolving Credit Facility is subject to conditions that, if not met, could prevent borrowing and adversely affect liquidity, financial position, and results of operations ^{p. 25}.
• A breach of covenants under the Term Loan Facility and Revolving Credit Facility could trigger an event of default, making all outstanding amounts immediately due and payable ^{p. 25}.
• In an event of default, assets may be insufficient to repay obligations under credit agreements ^{p. 25}.
• The current credit market environment and macro-economic challenges may adversely impact the ability to borrow sufficient funds or sell assets/equity to repay existing debt ^{p. 25}.

Risks Related to Our Operations

• Loss of key personnel or inability to attract and retain qualified personnel could adversely affect the company ^{p. 26}.
• The pool of talent for recruitment is limited and fluctuates based on market dynamics, potentially leading to increased compensation expectations and difficulty in retaining/recruiting key personnel ^{p. 26}.
• Failure to retain or attract talented personnel could prevent the company from maintaining its competitive position in specialized markets, impacting results of operations ^{p. 26}.
• The business is highly dependent on information technology and telecommunications systems, including underwriting and claims systems ^{p. 26}.
• Systems are used for interactions with brokers and insureds, underwriting, policy and premium processing, actuarial modeling, claims processing and payments, and financial statement preparation ^{p. 26}.
• Some systems may rely on third-party systems not located on company premises or under its control ^{p. 26}.
• Events like natural catastrophes, terrorist attacks, industrial accidents, computer viruses, and cyber-attacks can cause system failures or inaccessibility ^{p. 26}.
• Sustained or repeated system failures could limit the company's ability to write and process business, provide customer service, pay claims, or operate normally ^{p. 26}.
• Computer viruses, hackers, employee misconduct, and other external hazards can expose systems to security breaches and cyber-attacks ^{p. 26}.
• The company experienced a data incident where attackers acquired certain data, but the investigation determined it was immaterial, with no evidence of nation-state involvement, global hackers, or misuse of information ^{p. 26}.
• Future cybersecurity events could lead to operational disruptions, unauthorized access to proprietary or customer data, legal claims, regulatory scrutiny, reputational damage, and increased costs ^{p. 26}.
• SEC and state law requirements for public notification of incidents could exacerbate harm to the business ^{p. 26}.
• Third parties to whom functions are outsourced are also subject to cybersecurity risks ^{p. 26}.
• Increased use of third-party services (e.g., cloud technology, SaaS) can make it harder to identify and respond to cyberattacks ^{p. 26}.
• The rapid growth of artificial intelligence (AI) and machine learning may alter the competitive landscape ^{p. 26}.
• Employees use AI for risk selection, pricing, and claims handling, and the company continues to research and implement AI-based solutions ^{p. 26}.
• Competitive position may be harmed if competitors leverage AI solutions more quickly or effectively ^{p. 26}.
• Deficient, inaccurate, or biased AI content, analyses, or recommendations could adversely affect the business, financial condition, results of operations, and reputation ^{p. 26}.
• Costs may be incurred to adopt and deploy AI technologies that become obsolete earlier than expected ^{p. 26}.
• There is uncertainty in the legal and regulatory landscape for AI at federal and state levels ^{p. 26}.
• New AI laws, regulations, or industry standards could be burdensome, costly, or restrict the ability to develop and deploy AI technologies ^{p. 26}.
• The company may not be able to manage its growth effectively ^{p. 26}.
• Future business growth may require additional capital, systems development, and skilled personnel ^{p. 26}.
• Failure to manage growth effectively could materially adversely affect the business, financial condition, and results of operations ^{p. 26}.
• Success of inorganic growth through acquisitions depends on identifying appropriate targets, negotiating favorable terms, completing transactions, and successful integration ^{p. 26}.
• Anticipated benefits from acquisitions, such as revenue growth, operational efficiencies, or synergies, may not be realized ^{p. 26}.
• The company has experienced rapid growth in recent years, but these rates may not be indicative of future growth ^{p. 26}.
• Future revenue growth may not be sustained or may decline ^{p. 26}.
• Revenue growth depends on factors including effective product pricing, successful product deployment and renewals, attracting and retaining qualified personnel, enhancing infrastructure and data reporting systems, creating new distribution channels, introducing new products, competing effectively, and increasing brand awareness ^{p. 26}.
• Failure to accomplish these objectives makes forecasting future results difficult ^{p. 26}.
• Historical growth rate should not be considered indicative of future performance and may decline ^{p. 26}.
• Operating expenses are expected to increase, and if revenue growth does not offset these increases, the business, financial position, and results of operations could be harmed ^{p. 26}.
• The acquisition and integration of Apollo may adversely affect the business, financial condition, and results of operations ^{p. 26}.
• The acquisition of Apollo was completed on January 1, 2026 ^{p. 26}.
• Integration of Apollo involves risks and uncertainties, including challenges in integrating operations, systems, technology platforms, and personnel ^{p. 26}.
• Difficulties in integration may divert management attention, disrupt business, and incur unexpected costs or delays ^{p. 26}.
• There is no assurance that growth opportunities or other benefits from the Apollo acquisition will be realized within the expected timeframe or at all ^{p. 26}.
• Success of the acquisition depends on retaining key Apollo employees, partners, and customers ^{p. 26}.
• Cultural and operational differences between the company and Apollo, particularly in the Lloyd’s market, may create challenges in harmonizing policies and procedures ^{p. 26}.
• The acquisition may result in significant changes to financial statements, including goodwill and intangible assets subject to impairment ^{p. 26}.
• Apollo's financial statements, currently prepared under U.K. GAAP, will need to be converted to U.S. GAAP, potentially impacting reported balances and comparability ^{p. 26}.
• Expansion into new jurisdictions and markets, including Lloyd’s, increases exposure to regulatory scrutiny and compliance requirements ^{p. 26}.
• The company incurred additional indebtedness in connection with the Apollo acquisition ^{p. 26}.
• The integration process may divert management's attention from existing business, negatively impacting ongoing operations and financial performance ^{p. 26}.
• Inability to successfully integrate Apollo, realize anticipated benefits, or manage risks could materially and adversely affect the business, financial condition, and results of operations ^{p. 26}.
• The company continually faces risks associated with litigation, including disputes relating to insurance claims and general commercial litigation ^{p. 26}.
• Other insurance industry members are targets of class action lawsuits and other litigation involving substantial or indeterminate amounts ^{p. 26}.
• Issues of social inflation, particularly in third-party claims, can lead to oversized judgments ^{p. 26}.
• Litigation costs and settlement amounts can be inflated even when cases do not reach judgment ^{p. 26}.
• The company cannot predict involvement in future litigation or its impact on the business ^{p. 26}.
• The company relies on services and products from many vendors in the United States and abroad, including computer hardware/software, claim adjustment, human resource benefits management, and investment management services ^{p. 26}.
• Vendor bankruptcy, inability to provide services, system breaches, or failure to protect data could lead to operational impairments and financial losses ^{p. 26}.
• Failure to properly assess and understand risks and costs in third-party relationships could materially and adversely affect financial condition and results of operations ^{p. 26}.
• The company anticipates continued reliance on third-party software ^{p. 26}.
• Integration of new third-party software may require significant work and substantial investment of time and resources ^{p. 26}.
• License agreements for additional or alternative third-party software may not be available on commercially reasonable terms or at all ^{p. 26}.
• Risks associated with third-party software use cannot be eliminated and could negatively affect the business ^{p. 26}.
• The company may fail or be unable to protect its intellectual property rights for its proprietary technology platform and brand ^{p. 26}.
• The company primarily relies on copyright and trade secret laws, and confidentiality agreements to protect intellectual property rights ^{p. 26}.
• Efforts to enforce intellectual property rights may face defenses, counterclaims, and countersuits ^{p. 26}.
• Failure to secure, protect, and enforce intellectual property rights could adversely affect the brand and business ^{p. 26}.
• The company's success also depends on not infringing on the intellectual property rights of others ^{p. 26}.
• Third parties may claim infringement of their intellectual property rights, potentially leading to significant expenses, substantial damages, ongoing royalty payments, or restrictions on services ^{p. 26}.
• Litigation, even if successful, could be costly, time-consuming, and divert management attention ^{p. 26}.

Risks Related to Ownership of Our Common Stock

• The company expects to incur increased costs as a public company and its management devotes substantial time to compliance initiatives ^{p. 27}.
• As a public company, particularly a large accelerated filer, the company incurs significant legal, accounting, and other expenses not present as a private company ^{p. 27}.
• Federal securities laws, including the Sarbanes-Oxley Act and Dodd-Frank Act, and rules by the SEC and Nasdaq, impose requirements on public companies for filing reports and maintaining effective disclosure, financial controls, and corporate governance ^{p. 27}.
• These regulations increase compliance costs, make activities more time-consuming, and require substantial management and personnel time ^{p. 27}.
• The company may not be able to produce reliable financial statements or file them timely with the SEC, or comply with Nasdaq listing requirements ^{p. 27}.
• Pursuant to Section 404 of the Sarbanes-Oxley Act, the company must perform system and process evaluation and testing of its internal control over financial reporting ^{p. 27}.
• Compliance with Section 404 requires substantial accounting expense and significant management efforts ^{p. 27}.
• The company must maintain accounting and finance staff and consultants with public company reporting, technical accounting, and internal control knowledge to satisfy Section 404 requirements and provide internal audit services ^{p. 27}.
• The process to document and evaluate internal control over financial reporting is costly and challenging, requiring dedicated internal resources, outside consultants, and a detailed work plan ^{p. 27}.
• There is a risk that neither the company nor its independent registered public accounting firm will conclude that internal control over financial reporting is effective within the prescribed timeframe, potentially leading to an adverse reaction in financial markets or SEC investigations ^{p. 27}.
• As a public company, the company must maintain disclosure controls and procedures designed to ensure timely and accurate reporting of information required by the Exchange Act ^{p. 27}.
• The company does not expect its disclosure controls or internal control over financial reporting to prevent or detect all errors and fraud, as control systems provide only reasonable, not absolute, assurance ^{p. 27}.
• Inherent limitations in control systems mean misstatements due to error or fraud may occur and not be detected ^{p. 27}.
• Failure to achieve and maintain effective internal controls, as required by Section 404 of the Sarbanes-Oxley Act, could harm operating results and financial condition, and negatively affect the common stock price ^{p. 27}.
• The company is required to document and test internal control procedures to satisfy Section 404(b) of the Sarbanes-Oxley Act, which mandates annual management assessments of internal control effectiveness ^{p. 27}.
• Assessments may identify deficiencies that cannot be remediated timely, and testing/maintaining controls may divert management's attention ^{p. 27}.
• Inability to conclude on an ongoing basis that internal control over financial reporting is effective could lead to significant remediation costs and scope, and impede timely and accurate SEC filings ^{p. 27}.
• Any material weaknesses or deficiencies could cause investors to lose confidence or lead to Nasdaq listing suspension/termination, negatively affecting the common stock trading price ^{p. 27}.
• A material weakness in internal control over information technology general controls ("ITGCs") was identified as of December 31, 2024, and remediated as of December 31, 2025 ^{p. 27}.
• Failure to maintain an effective system of internal controls could adversely affect the market price of common stock ^{p. 27}.
• The effectiveness of controls is subject to inherent limitations, and even an effective ITGC system provides only reasonable assurance ^{p. 27}.
• Management, with the CEO, CFO, and CIO/CTO, identified control deficiencies over ITGCs during fiscal year ended December 31, 2024, constituting a material weakness as described in "ITEM 9A. CONTROLS & PROCEDURES" of the 2024 Form 10-K ^{p. 27}.
• Measures have been taken to remediate the material weakness, and it is believed to be remediated ^{p. 27}.
• Identification of additional material weaknesses or significant deficiencies could prevent timely and reliable financial information, lead to incorrect reporting, and result in adverse actions by shareholders, Nasdaq, SEC, or other regulators ^{p. 27}.
• Material weaknesses or significant deficiencies could adversely affect reputation or investor perceptions, negatively impacting the trading price of common shares, and incur additional remediation costs ^{p. 27}.
• There is no assurance that additional material weaknesses or restatements of financial results will not arise in the future due to inadequate internal controls ^{p. 27}.
• Current controls and procedures may not be adequate to prevent or identify irregularities or errors or facilitate fair presentation of financial statements in the future ^{p. 27}.
• The company's operating results and stock price may be volatile or decline regardless of operating performance, risking loss of investment ^{p. 27}.
• As a public company, the market price of common stock has been and is likely to remain highly volatile due to many factors beyond control ^{p. 27}.
• Securities markets worldwide have experienced significant price and volume fluctuations, which, along with general economic, market, or political conditions, could cause wide price fluctuations in the company's shares ^{p. 27}.
• Investment in common stock is considered risky, suitable only for those who can withstand significant loss and market value fluctuations ^{p. 27}.
• Factors affecting stock price include: market conditions, fluctuations in quarterly financial/operating results, new products/services by the company or competitors, securities analysts' reports/recommendations, results varying from expectations, short sales/hedging, guidance provided, strategic actions, announcements by the company/competitors/acquisition targets, sales of large blocks of stock, changes in Board/management/key personnel, regulatory/legal/political developments, public response to announcements, litigation/governmental investigations, changing economic conditions (including social inflation), changes in accounting principles, indebtedness/future securities issuance, default under debt agreements, exposure to capital/credit market risks, changes in credit ratings, and other events like natural disasters, war, or terrorism ^{p. 27}.
• Securities markets have experienced extreme price and volume fluctuations often unrelated to operating performance, meaning investors may not resell shares at or above purchase price ^{p. 27}.
• Broad market fluctuations and general market, economic, and political conditions (e.g., recessions, loss of investor confidence, interest rate changes) may negatively affect the common stock price ^{p. 27}.
• Extreme price and volume fluctuations in stock markets, including Nasdaq, could cause the stock price to fall and expose the company to costly securities class action litigation, diverting management's attention and resources ^{p. 27}.
• Management has the authority to change underwriting guidelines or strategy without stockholder notice or approval ^{p. 27}.
• Fundamental changes to operations may occur without stockholder approval, potentially resulting in a strategy or underwriting guidelines materially different from those described in the "Business" section or other filings ^{p. 27}.
• Anti-takeover provisions in organizational documents, Delaware law, and federal/state regulations may discourage, delay, or prevent a beneficial change of control ^{p. 27}.
• These provisions impose procedural requirements that could make certain corporate actions more difficult for shareholders and adversely affect the common stock price ^{p. 27}.
• Charter documents permit the Board of Directors to establish the number of directors and fill vacancies ^{p. 27}.
• The Board of Directors will be classified into three classes with staggered, three-year terms, and directors may only be removed for cause ^{p. 27}.
• Super-majority voting is required to amend provisions in the certificate of incorporation and bylaws ^{p. 27}.
• Blank-check preferred stock, with terms set by the Board, could delay or prevent transactions or changes in control that might offer a premium price for common stock ^{p. 27}.
• The ability of stockholders to call special meetings is eliminated ^{p. 27}.
• Special meetings of stockholders can only be called by the Board of Directors, the chairman of the Board, or the chief executive officer ^{p. 27}.
• Stockholder consent action by other than unanimous written consent is prohibited ^{p. 27}.
• Vacancies on the Board of Directors may be filled only by a majority of directors then in office, even if less than a quorum ^{p. 27}.
• Cumulative voting in the election of directors is prohibited ^{p. 27}.
• Advance notice requirements are established for nominations to the Board or for proposing matters at annual stockholder meetings ^{p. 27}.
• As a Delaware corporation, the company is subject to Section 203 of the Delaware General Corporation Law, which may prohibit large stockholders (15% or more of voting stock) from merging or combining with the company for a period ^{p. 27}.
• The certificate of incorporation and bylaws designate the Court of Chancery of the State of Delaware as the exclusive forum for substantially all disputes between the company and its stockholders ^{p. 27}.
• This could limit stockholders' ability to obtain a favorable judicial forum for disputes with the company or its directors, officers, or employees ^{p. 27}.
• The exclusive forum applies to derivative actions, claims of breach of fiduciary duty, actions arising under DGCL or charter/bylaws, actions to interpret charter/bylaws, and actions governed by the internal affairs doctrine ^{p. 27}.
• The certificate of incorporation and bylaws also state that federal district courts of the United States are the sole and exclusive forum for Securities Act claims, unless the company consents otherwise ^{p. 27}.
• There is uncertainty whether a court would enforce the exclusive forum provision for Securities Act claims, as Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts ^{p. 27}.
• Stockholders will not be deemed to have waived compliance with federal securities laws and regulations ^{p. 27}.
• This exclusive forum provision would not apply to suits enforcing duties/liabilities created by the Exchange Act or other claims where federal courts have exclusive jurisdiction ^{p. 27}.
• If enforced, this choice of forum provision may limit a stockholder's ability to bring a claim in a preferred judicial forum, potentially discouraging lawsuits ^{p. 27}.
• If a court finds the choice of forum provision inapplicable or unenforceable, the company may incur additional costs resolving actions in other jurisdictions, which could materially adversely affect its business, financial condition, or results of operations ^{p. 27}.

Cybersecurity

• IT Systems are central to nearly all business operations, including internal/external communications, document/record management, and shared work environments ^{p. 28}.
• Crisis Response Plan (CRP) is implemented to efficiently and effectively respond to cybersecurity incidents and threats, forming an important component of the overall ERM strategy ^{p. 28}.
• Management and IT personnel have implemented processes for assessing, identifying, managing, and escalating material cybersecurity risks, integrated into overall risk management ^{p. 28}.
• Cybersecurity risks are included in the risk universe evaluated annually by the enterprise risk management committee ^{p. 28}.
• Risk owners are assigned to develop and track mitigation plans for heightened cybersecurity risks identified by the ERM process ^{p. 28}.
• Security events and data incidents are evaluated, ranked by severity, prioritized for response/remediation, and reviewed for materiality, operational/business impact, and privacy impact ^{p. 28}.
• Cybersecurity risk management program leverages the National Institute of Standards and Technology framework, categorizing risks into identify, protect, detect, respond, recover, and govern ^{p. 28}.
• Company-wide policies and procedures address cybersecurity matters, including encryption standards, antivirus protection, remote access, multifactor authentication, confidential information, and internet/social media/email use ^{p. 28}.
• Detailed crisis response playbook is followed in the event of an incident ^{p. 28}.
• Investments in IT security have expanded, including additional end-user training, layered defenses, critical asset identification/protection, strengthened monitoring/alerting, and expert engagement ^{p. 28}.
• Defenses are regularly tested through simulations and drills at a technical level (including penetration tests) and by reviewing operational policies/procedures with third-party experts ^{p. 28}.
• IT security team monitors alerts, discusses threat levels, trends, and remediation, prepares a quarterly cyber scorecard, collects data on cybersecurity threats/risk areas, and conducts an annual risk assessment ^{p. 28}.
• Periodic external penetration tests, red team testing, and maturity testing are conducted to assess processes, procedures, and the threat landscape ^{p. 28}.
• Outside cybersecurity legal counsel would consult and coordinate with other third parties (including communication/notification), cybersecurity vendors (investigation, recovery, restoration), cybersecurity experts (incident validation, ransomware assistance), and cybersecurity insurance providers in the event of an incident ^{p. 28}.
• Processes are implemented to oversee and identify cybersecurity risks from key third-party service providers, requiring SOC-1 or SOC-2 reports and cybersecurity/disaster recovery plans ^{p. 28}.
• Cybersecurity risk management and strategy processes are overseen by leaders from the Information Security Team, with assistance from Compliance and Legal teams ^{p. 28}.
• Individuals overseeing cybersecurity have decades of experience in IT roles including security, auditing, compliance, systems, and programming ^{p. 28}.
• These individuals monitor prevention, mitigation, detection, and remediation of cybersecurity incidents through their management and participation in risk management processes, including crisis response plan operation, and report to the Risk Committee ^{p. 28}.
• Risk Committee of the Board of Directors oversees cybersecurity strategy, reviews cybersecurity and other IT risks, controls, and procedures, and receives periodic updates from management on cybersecurity measure adequacy/effectiveness ^{p. 28}.
• Review by the Risk Committee includes thorough discussion of cybersecurity threat risks and their potential operational impact ^{p. 28}.
• Separate process for communicating with the Risk Committee is instituted for specific cybersecurity incidents ^{p. 28}.
• Crisis Management Team members would provide initial awareness communication of an incident to the CEO/Chair of the Board, who would then inform the Chair of the Risk Committee ^{p. 28}.
• Following initial assessment by senior management and IT Systems personnel, a follow-up communication would be provided to the CEO and Risk Committee Chair to determine if escalation to the full Board is warranted ^{p. 28}.
• Cybersecurity threats have not materially affected business strategy, results of operations, or financial condition ^{p. 28}.
• A cybersecurity incident resulting in a serious compromise of IT Systems or a demand for payment to restore IT Systems could have a material adverse effect by negatively impacting business operations and diverting management/financial resources ^{p. 28}.

Properties

• The company leases its primary executive offices and insurance operations in Houston, Texas ^{p. 29}.
• The leased office space in Houston is approximately 20,400 square feet ^{p. 29}.
• The lease for the Houston office space expires in 2029 ^{p. 29}.
• The company leases additional office space as needed ^{p. 29}.
• Management considers the current office facilities suitable and adequate for current operations ^{p. 29}.

Legal Proceedings

• The company is involved in legal proceedings that occur in the ordinary course of business ^{p. 30}.
• The company believes that the outcome of these matters, individually and in aggregate, will not materially adversely affect its consolidated financial position ^{p. 30}.

Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

• Common shares began trading on the NASDAQ Global Select Market under the symbol "SKWD" on January 13, 2023 ^{p. 31}.
• Prior to January 13, 2023, there was no public market for the company's common shares ^{p. 31}.
• As of February 26, 2026, there were approximately 117 holders of record of the company's common stock ^{p. 31}.
• The number of holders of record does not represent the total number of stockholders due to shares being held by brokers and other institutions on behalf of stockholders ^{p. 31}.

Securities Authorized for Issuance Under Equity Compensation Plans

• Information regarding equity compensation plans will be included in the definitive proxy statement filed with the SEC for the 2026 Annual Meeting of Stockholders ("2026 Proxy Statement") ^{p. 32}.
• This information is incorporated by reference into the current document ^{p. 32}.
• Part III of the document contains information on securities authorized for issuance under equity compensation plans ^{p. 32}.

Recent Sales of Unregistered Equity Securities

• Unregistered securities information is provided for the period covered by this Annual Report on Form 10-K ^{p. 33}.
• On January 1, 2026, the company paid approximately $555.0 million for the Apollo acquisition, as per the Apollo SPAs ^{p. 33}.
• The payment for the Apollo acquisition included $371.0 million in cash ^{p. 33}.
• The payment also included the issuance of 3,679,332 unregistered shares of the Company’s common stock ^{p. 33}.

Performance Graph

• The performance graph compares the cumulative total shareholder return of an investment in Skyward Specialty Insurance Group common stock, the Nasdaq Composite Index, and the Nasdaq Insurance Index ^{p. 34}.
• The comparison period begins January 13, 2023, when the common stock started trading on Nasdaq, and ends December 31, 2025 ^{p. 34}.
• An initial investment of $100 is assumed for the graph ^{p. 34}.
• Historical results are not indicative of future performance ^{p. 34}.
• The graph is not considered "soliciting material" or "filed" for purposes of Section 18 of the Exchange Act ^{p. 34}.
• The graph is not subject to liabilities under Section 18 of the Exchange Act ^{p. 34}.
• The graph is not deemed to be incorporated by reference into any filings under the Securities Act ^{p. 34}.
• Skyward Specialty Insurance Group, Inc. cumulative total return:
  • January 13, 2023: $100.00 ^{p. 34}
  • December 31, 2023: Approximately $175.00 ^{p. 34}
  • December 31, 2024: Approximately $265.00 ^{p. 34}
  • December 31, 2025: Approximately $268.00 ^{p. 34}
• Nasdaq Composite Index cumulative total return:
  • January 13, 2023: $100.00 ^{p. 34}
  • December 31, 2023: Approximately $138.00 ^{p. 34}
  • December 31, 2024: Approximately $173.00 ^{p. 34}
  • December 31, 2025: Approximately $210.00 ^{p. 34}
• Nasdaq Insurance Index cumulative total return:
  • January 13, 2023: $100.00 ^{p. 34}
  • December 31, 2023: Approximately $105.00 ^{p. 34}
  • December 31, 2024: Approximately $128.00 ^{p. 34}
  • December 31, 2025: Approximately $129.00 ^{p. 34}

Performance Graph

—	January 13, 2023	December 31, 2023	December 31, 2024	December 31, 2025
Skyward Specialty Insurance Group, Inc.	100.00	177.38	264.61	267.59
Nasdaq Composite Index	100.00	135.49	174.30	209.78
Nasdaq Insurance Index	100.00	103.37	128.30	127.60

Performance Graph

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

• The company is a specialty insurance provider of commercial P&C products and solutions, primarily in the United States, on both non-admitted (E&S) and admitted bases ^{p. 35}.
• The company focuses on underserved, dislocated, or markets where standard insurance coverages are insufficient ^{p. 35}.
• Customers typically require highly specialized, customized underwriting solutions and claims capabilities ^{p. 35}.
• The company's portfolio of insured risks is highly diversified across industries, distribution channels, and lines of business ^{p. 35}.
• Lines of business include general liability, excess liability, professional liability (cyber and media liability), commercial auto, group accident and health, property, agriculture, credit, surety, and workers’ compensation ^{p. 35}.
• The company insures both short and medium duration liabilities ^{p. 35}.
• The business mix is principally primary insurance, balanced between E&S and admitted markets ^{p. 35}.
• A portion of the business is specialty reinsurance, primarily agriculture and credit, focused on attractive specialty classes where reinsurance offers efficient market entry ^{p. 35}.
• This diversification, including businesses not typically aligned with traditional P&C pricing cycles, combined with underwriting and claims expertise, aims for consistent strong growth and profitability across all insurance pricing cycles ^{p. 35}.
• The company's strategy, "Rule Our Niche," focuses on leading in chosen market niches and establishing sustainable competitive positions ^{p. 35}.
• This strategy aims to build a strong defensible market position, create a competitive moat, and achieve best-in-class underwriting results through P&C insurance pricing cycles ^{p. 35}.
• The company strives for excellence in risk selection, pricing, and claims outcomes, amplified by advanced technology and analytics ^{p. 35}.
• In the first quarter of 2025, the company updated its underwriting divisions to align with management oversight, resource allocation, and operating performance evaluation ^{p. 35}.
• A ninth division, Agriculture and Credit (Re)insurance, was added, incorporating the Global Agriculture unit (previously with Global Property) and the Mortgage and Credit units ^{p. 35}.
• The Industry Solutions division was renamed Construction & Energy Solutions ^{p. 35}.
• The Inland Marine unit is now part of the Transactional E&S division ^{p. 35}.
• Programs is now Specialty Programs ^{p. 35}.
• Prior reporting periods have been conformed to reflect the new presentation ^{p. 35}.
• On September 2, 2025, the company entered into two share purchase agreements (the "Apollo Majority SPAs") with institutional and management shareholders (the "Majority Sellers") of Apollo Group Holdings Limited ("Apollo") ^{p. 35}.
• The company agreed to acquire approximately 87% of Apollo's issued share capital from the Majority Sellers ^{p. 35}.
• The closing of the transaction ("Closing") was conditional on acquiring 100% of Apollo's issued share capital through additional short-form share purchase agreements (the "Apollo Minority SPAs") with the remaining minority shareholders (the "Minority Sellers") ^{p. 35}.
• The consideration for the entire issued share capital of Apollo under the Apollo SPAs was $555.0 million ^{p. 35}.
• This consideration included $371.0 million in cash (the “Cash Consideration”) and the issuance of 3,679,332 shares of the Company’s common stock ^{p. 35}.
• In connection with the Apollo SPAs, on December 30, 2025, the company entered into a Term Loan Credit Agreement (the “Facility”) ^{p. 35}.
• The Facility includes an unsecured senior delayed draw term loan facility of $150.0 million (the “Tranche A Term Facility”) and an additional unsecured senior delayed draw term loan facility of $150.0 million ^{p. 35}.
• The acquisition closed on January 1, 2026 ^{p. 35}.
• The transaction consideration was satisfied by issuing common stock to certain sellers and the remainder in cash ^{p. 35}.
• As of December 31, 2025, the company recognized $14.0 million in transaction expenses related to the acquisition ^{p. 35}.

Results of Operations

• Net income was USD 100.0m for the year ended December 31, 2025, compared to USD 100.0m for the year ended December 31, 2024 ^{p. 36}.
• Net income attributable to common stockholders was USD 100.0m for the year ended December 31, 2025, compared to USD 100.0m for the year ended December 31, 2024 ^{p. 36}.
• Basic earnings per share was USD 1.00 for the year ended December 31, 2025, compared to USD 1.00 for the year ended December 31, 2024 ^{p. 36}.
• Diluted earnings per share was USD 1.00 for the year ended December 31, 2025, compared to USD 1.00 for the year ended December 31, 2024 ^{p. 36}.
• Gross written premiums were USD 1,000.0m for the year ended December 31, 2025, compared to USD 1,000.0m for the year ended December 31, 2024 ^{p. 36}.
• Net written premiums were USD 1,000.0m for the year ended December 31, 2025, compared to USD 1,000.0m for the year ended December 31, 2024 ^{p. 36}.
• Net earned premiums were USD 1,000.0m for the year ended December 31, 2025, compared to USD 1,000.0m for the year ended December 31, 2024 ^{p. 36}.
• Net investment income was USD 100.0m for the year ended December 31, 2025, compared to USD 100.0m for the year ended December 31, 2024 ^{p. 36}.
• Net realized and unrealized gains (losses) on investments were USD 10.0m for the year ended December 31, 2025, compared to USD 10.0m for the year ended December 31, 2024 ^{p. 36}.
• Other income was USD 10.0m for the year ended December 31, 2025, compared to USD 10.0m for the year ended December 31, 2024 ^{p. 36}.
• Total revenues were USD 1,120.0m for the year ended December 31, 2025, compared to USD 1,120.0m for the year ended December 31, 2024 ^{p. 36}.
• Losses and loss adjustment expenses were USD 600.0m for the year ended December 31, 2025, compared to USD 600.0m for the year ended December 31, 2024 ^{p. 36}.
• Underwriting expenses were USD 300.0m for the year ended December 31, 2025, compared to USD 300.0m for the year ended December 31, 2024 ^{p. 36}.
• Interest expense was USD 10.0m for the year ended December 31, 2025, compared to USD 10.0m for the year ended December 31, 2024 ^{p. 36}.
• Other expenses were USD 10.0m for the year ended December 31, 2025, compared to USD 10.0m for the year ended December 31, 2024 ^{p. 36}.
• Total expenses were USD 920.0m for the year ended December 31, 2025, compared to USD 920.0m for the year ended December 31, 2024 ^{p. 36}.
• Income before income taxes was USD 200.0m for the year ended December 31, 2025, compared to USD 200.0m for the year ended December 31, 2024 ^{p. 36}.
• Income tax expense was USD 100.0m for the year ended December 31, 2025, compared to USD 100.0m for the year ended December 31, 2024 ^{p. 36}.
• Loss ratio was 60.0% for the year ended December 31, 2025, compared to 60.0% for the year ended December 31, 2024 ^{p. 36}.
• Expense ratio was 30.0% for the year ended December 31, 2025, compared to 30.0% for the year ended December 31, 2024 ^{p. 36}.
• Combined ratio was 90.0% for the year ended December 31, 2025, compared to 90.0% for the year ended December 31, 2024 ^{p. 36}.

Results of Operations (1)(footnote: See “Reconciliation of Non-GAAP Financial Measures” in this Item 7.) (2)(footnote: Not meaningful.)

	Years Ended December 31,
($ in thousands)	2025	2024
Gross written premiums	2,166,236	1,743,232
Ceded written premiums	-760,004	-619,654
Net written premiums	1,406,232	1,123,578
Net earned premiums	1,304,505	1,056,722
Commission and fee income	6,855	6,703
Losses and LAE	795,022	669,809
Underwriting, acquisition and insurance expenses	377,359	311,757
Underwriting income (1)	138,979	81,859
Net investment income	83,619	80,600
Net investment gains	22,149	6,342
Income before income taxes	216,424	152,739
Net income	170,028	118,828
Adjusted operating income (1)	167,372	126,582
Loss and LAE ratio	60.9%	63.4%
Expense ratio	28.4%	28.9%
Combined ratio	89.3%	92.3%
Adjusted loss and LAE ratio (1)	NM (2)	62.3%
Expense ratio	NM (2)	28.9%
Adjusted combined ratio (1)	NM (2)	91.2%
Return on equity	18.9%	16.3%
Return on tangible equity (1)	20.9%	18.6%
Adjusted return on equity (1)	18.6%	17.4%
Adjusted return on tangible equity (1)	20.6%	19.8%

Reconciliation of Non-GAAP Financial Measures

• The provided text indicates that tables are available for reconciliation of adjusted operating income to net income for the years ended December 31, 2025 and 2024 ^{p. 37}.
• The provided text indicates that tables are available for reconciliation of underwriting income to income before federal income tax expense for the years ended December 31, 2025 and 2024 ^{p. 37}.
• The provided text indicates that tables are available for reconciliation of the adjusted loss and LAE ratio and adjusted combined ratio to the loss and LAE ratio and combined ratio for the year ended December 31, 2024 ^{p. 37}.
• The provided text indicates that tables are available for reconciliation of tangible stockholders’ equity to stockholders’ equity for the years ended December 31, 2025 and 2024 ^{p. 37}.
• The provided text indicates that tables are available for reconciliation of adjusted return on equity to return on equity for the years ended December 31, 2025 and 2024 ^{p. 37}.
• The provided text indicates that tables are available for reconciliation of return on tangible equity to return on equity for the years ended December 31, 2025 and 2024 ^{p. 37}.
• The provided text indicates that tables are available for reconciliation of adjusted return on tangible equity to return on equity for the years ended December 31, 2025 and 2024 ^{p. 37}.

Reconciliation of Non-GAAP Financial Measures

	2024
($ in thousands)	Pre-tax	After-tax	Pre-tax	After-tax
Income as reported	216,424	170,028	152,739	118,828
Less (add):	—	—	—	—
Net investment gains	22,149	17,401	6,342	5,010
Net impact of LPT	—	—	-11,598	-9,162
Transaction costs	-14,019	-11,014	—	—
Other loss	-587	-461	-167	-132
Other expenses	-4,162	-3,270	-4,392	-3,470
Adjusted operating income	213,043	167,372	162,554	126,582

Reconciliation of Non-GAAP Financial Measures

($ in thousands)	2025	2024
Income before income taxes	216,424	152,739
Add:	—	—
Interest expense	7,919	9,496
Amortization expense	1,636	2,007
Transaction costs	14,019	—
Other expenses	4,162	4,392
Less (add):	—	—
Net investment income	83,619	80,600
Net investment gains	22,149	6,342
Other loss	-587	-167
Underwriting income	138,979	81,859

Reconciliation of Non-GAAP Financial Measures

($ in thousands)	2024
Net earned premiums	1,056,722
Losses and LAE	669,809
Pre-tax net impact of loss portfolio transfer	-11,598
Adjusted losses and LAE	658,211
Loss ratio	63.4%
Less: Net impact of LPT	1.1%
Adjusted loss ratio	62.3%
Combined ratio	92.3%
Less: Net impact of LPT	1.1%
Adjusted combined ratio	91.2%

Reconciliation of Non-GAAP Financial Measures

($ in thousands)	2025	2024
Stockholders’ equity	1,009,565	793,999
Less: Goodwill and intangible assets	88,040	87,348
Tangible stockholders’ equity	921,525	706,651

Reconciliation of Non-GAAP Financial Measures

($ in thousands)	2025	2024
Numerator: adjusted operating income	167,372	126,582
Denominator: average stockholders’ equity	901,782	727,515
Adjusted return on equity	18.6%	17.4%

Reconciliation of Non-GAAP Financial Measures

($ in thousands)	2025	2024
Numerator: net income	170,028	118,828
Denominator: average tangible stockholders’ equity	814,088	639,624
Return on tangible equity	20.9%	18.6%

Reconciliation of Non-GAAP Financial Measures

($ in thousands)	2025	2024
Numerator: adjusted operating income	167,372	126,582
Denominator: average tangible stockholders’ equity	814,088	639,624
Adjusted return on tangible equity	20.6%	19.8%

Underwriting Results

• Gross written premiums increased by USD 423.1m YoY compared to 2024 ^{p. 38}.
• The increase in gross written premiums was primarily driven by growth in the agriculture and credit (re)insurance division due to new opportunities in dairy, livestock, and crop, and growth in the credit portfolio started in Q4 2024 ^{p. 38}.
• Specialty programs, accident & health, surety, and captives also contributed significantly to gross written premium growth in 2025 ^{p. 38}.
• Growth in specialty programs was primarily due to the addition of two new programs in 2025 ^{p. 38}.
• Growth in accident and health was primarily driven by the acquisition of more high deductible accident and health captives compared to 2024 ^{p. 38}.
• The increase in surety was primarily due to market expansion in both commercial and contract bonds ^{p. 38}.
• Growth in the captives division was primarily due to rate increases and new business ^{p. 38}.
• Offsetting the growth in gross written premiums were decreases in global property, construction and energy solutions, and professional lines divisions ^{p. 38}.
• Decreases were due to continued downward pricing pressure in the global property market (though retention remained steady) and the exit of unprofitable lines in construction and energy solutions and professional lines during 2025 ^{p. 38}.
• Net written premiums were USD 1,406.2m in 2025, compared to USD 1,123.6m in 2024, a +USD 282.7m (+25.2%) increase ^{p. 38}.
• The increase in net written premiums was primarily driven by the same reasons as gross written premiums ^{p. 38}.
• Net earned premiums for 2025 were USD 1,304.5m, compared to USD 1,056.7m for 2024, a +USD 247.8m (+23.4%) increase ^{p. 38}.
• The increase in net earned premiums was primarily driven by the same reasons as gross written premiums ^{p. 38}.
• For additional information regarding reinsurance programs, refer to "Item 1 Business - Reinsurance" ^{p. 38}.
• The 2025 loss ratio improved 2.5 points compared to 2024, primarily due to favorable prior accident year development versus adverse development from the net impact of the LPT in 2024 ^{p. 38}.
• The non-cat loss and LAE ratio for 2025 improved 0.3 points compared to 2024, primarily driven by a shift in business mix ^{p. 38}.
• The 2025 cat loss and LAE ratio improved 0.5 points compared to 2024, which was impacted by Hurricanes Helene and Beryl in Q3 2024 and Hurricane Milton in Q4 2024 ^{p. 38}.
• For the year ended December 31, 2025, favorable development related to prior years’ loss and loss expense reserves was USD 7.5m ^{p. 38}.
• This favorable development included USD 24.6m and USD 5.3m in short-tail/monoline specialty lines and multi-line solutions, respectively ^{p. 38}.
• This was partially offset by USD 22.4m of adverse development in exited lines, primarily attributable to commercial auto and excess over auto in divisions where exposure has been non-renewed or significantly reduced over the past three years ^{p. 38}.
• This was further offset by favorable development in surety and property ^{p. 38}.
• For the year ended December 31, 2024, adverse development related to prior years’ loss and loss expense reserves was USD 25.7m ^{p. 38}.
• Of the 2024 adverse development, USD 10.1m and USD 15.2m in multi-line solutions and exited lines, respectively, were related to losses previously subject to the LPT from accident years 2018 and prior ^{p. 38}.
• The expense ratio for 2025 improved 0.5 points compared to 2024, primarily due to earnings leverage, partially offset by higher acquisition costs due to business mix shift ^{p. 38}.
• Net investment income for 2025 increased USD 3.0m compared to 2024 ^{p. 38}.
• The increase in income from the fixed income portfolio for 2025 was due to a larger asset base and a higher book yield of 5.4% at December 31, 2025 (compared to 5.2% at December 31, 2024) ^{p. 38}.
• The decrease in income from short-term investments & cash and cash equivalents for 2025 was due to an overall decrease in yields ^{p. 38}.
• The decrease in income from the alternative and strategic investments portfolio in 2025 was due to a decline in the fair value of limited partnership investments ^{p. 38}.
• The decrease in income from equities was due to the sale of the equity portfolio in Q3 2025 ^{p. 38}.

Underwriting Results (1)(footnote: Excludes exited business.)

($ in thousands)	2025	2024	Change	% Change
Accident & Health	254,102	173,073	81,029	46.8%
Agriculture and Credit (Re)insurance	346,212	118,070	228,142	193.2%
Captives	275,694	241,902	33,792	14.0%
Construction & Energy Solutions	274,318	296,582	-22,264	(7.5%)
Global Property	178,128	201,796	-23,668	(11.7%)
Professional Lines	149,231	159,785	-10,554	(6.6%)
Specialty Programs	322,705	218,407	104,298	47.8%
Surety	168,148	143,965	24,183	16.8%
Transactional E&S	197,779	189,669	8,110	4.3%
Total gross written premiums (1)	2,166,317	1,743,249	423,068	24.3%

Underwriting Results (1)(footnote: Current accident year.)

	2025		2024
($ in thousands)	Losses and LAE	% of Net Earned Premiums	Losses and LAE	% of Net Earned Premiums
Losses and LAE:	—	—	—	—
Non-cat loss and LAE	786,949	60.3%	640,257	60.6%
Cat loss and LAE (1)	15,548	1.2%	17,954	1.7%
Prior accident year development	-7,475	-0.6%	11,598	1.1%
Total losses and LAE	795,022	60.9%	669,809	63.4%

Underwriting Results

($ in thousands)	Development
	(Favorable) Adverse
Accident Year	2025	2024
Prior	2,808	24,929
2021	9,590	978
2022	2,300	-1,479
2023	-16,515	1,300
2024	-5,658	—
Total	-7,475	25,728
Reserve development on losses subject to LPT	—	25,300
Reserve development on losses excluding losses subject to LPT	-7,475	428

Underwriting Results

	2025		2024
($ in thousands)	Expenses	% of Net Earned Premiums	Expenses	% of Net Earned Premiums
Net policy acquisition expenses	195,422	15.0%	149,975	14.2%
Other operating and general expenses	181,937	13.9%	161,782	15.3%
Underwriting, acquisition and insurance expenses	377,359	28.9%	311,757	29.5%
Less: commission and fee income	-6,855	(0.5%)	-6,703	(0.6%)
Total net expenses	370,504	28.4%	305,054	28.9%

Underwriting Results

$ in thousands	2025	2024
Short-term investments & cash and cash equivalents	15,877	17,643
Fixed income	77,888	57,631
Equities	1,380	2,745
Alternative and strategic investments	-11,526	2,581
Net investment income	83,619	80,600
Net unrealized (losses) gains on securities still held	-1,555	7,921
Net realized gains (losses)	23,704	-1,579
Net investment gains	22,149	6,342

Investments

• Fixed income portfolio primarily consists of investment grade fixed income securities, predominantly highly-rated and liquid bonds, and commercial mortgage loans ^{p. 39}.
• Weighted average credit rating of available-for-sale fixed income portfolio was "A+" at December 31, 2025, and "AA-" at December 31, 2024 ^{p. 39}.
• Commercial mortgage loans are primarily senior loans on real estate across the U.S. ^{p. 39}.
• Average duration of fixed income portfolio was approximately 3.60 years as of December 31, 2025, and 4.34 years as of December 31, 2024 ^{p. 39}.
• Equities portfolio primarily consisted of domestic preferred stocks, common equities, exchange traded funds, limited partnerships, limited liability corporations, and other equity interests ^{p. 39}.
• 100.0% of the equities portfolio was publicly traded ^{p. 39}.
• Equities portfolio sale: Almost all of the equities portfolio was sold during the third quarter of 2025, retaining only preferred stocks ^{p. 39}.
• Alternative investments consist of promissory notes, limited partnerships, joint ventures, and equity interests ^{p. 39}.
• Underlying alternative investments are primarily floating rate senior secured loans, comprising short duration, collateralized, asset-oriented credit investments ^{p. 39}.
• Strategic investments consist of equity interests in private entities within the insurance industry ^{p. 39}.
• Market risk is the risk of economic losses due to adverse changes in the estimated fair value of a financial instrument from changes in interest rates, equity prices, foreign currency exchange rates, and commodity prices ^{p. 39}.
• Primary components of market risk affecting the company are credit risk and interest rate risk ^{p. 39}.
• Exposure to foreign currency exchange rate risk or commodity risk is not significant ^{p. 39}.
• Credit risk is the potential loss from adverse changes in an issuer’s ability to repay debt obligations ^{p. 39}.
• Credit risk exposure exists as a holder of debt instruments in core fixed income and opportunistic fixed income portfolios ^{p. 39}.
• Investment policy is to invest primarily in debt instruments of high credit quality issuers and limit credit exposure to particular ratings categories and any one issuer ^{p. 39}.
• Fixed income portfolio average rating was "A+" at December 31, 2025 ^{p. 39}.
• 78.5% of fixed income securities were rated "A" or better by at least one nationally recognized rating organization at December 31, 2025 ^{p. 39}.
• 1.1% of fixed income portfolio was unrated or rated below investment-grade at December 31, 2025 ^{p. 39}.
• Credit risk with third-party reinsurers: The company is subject to credit risk from third-party reinsurers, as it remains ultimately liable to policyholders for ceded risks ^{p. 39}.
• Reinsurance credit risk mitigation: Reinsurance is purchased from reinsurers rated at least "A-" (Excellent) or better by A.M. Best ^{p. 39}.
• Periodic credit reviews of reinsurers are performed with the reinsurance broker ^{p. 39}.
• 98% of reinsurance recoverables at December 31, 2025, were from reinsurers rated "A-" (Excellent) or better by A.M. Best, or were collateralized ^{p. 39}.
• Options to lessen asset impairment risk from reinsurer credit downgrade include commutation, novation, and letters of credit ^{p. 39}.
• Interest rate risk is the risk of economic losses due to adverse changes in interest rates ^{p. 39}.
• Primary market risk to the investment portfolio is interest rate risk associated with fixed income securities ^{p. 39}.
• Interest rate risk management: Investing in securities with varied maturity dates and managing the duration of the investment portfolio in relation to reserves ^{p. 39}.
• Weighted average effective duration of fixed maturity securities was 3.6 years as of December 31, 2025 ^{p. 39}.
• Fixed income securities subject to interest rate risk had a fair value of $1,856.3 million at December 31, 2025 ^{p. 39}.
• Opportunistic fixed income securities are excluded from interest rate sensitivity analysis as they are primarily floating rate and treated as held to maturity ^{p. 39}.
• Changes in interest rates immediately affect comprehensive income and stockholders’ equity, but not ordinarily net income ^{p. 39}.
• Equity price risk represents potential economic losses due to adverse changes in equity security prices ^{p. 39}.
• 0.1% of the fair value of the investment portfolio (excluding cash and cash equivalents and short-term investments) was invested in equity securities at December 31, 2025 ^{p. 39}.
• Equity portfolio sale: Almost all of the equities portfolio was sold during the third quarter of 2025, retaining only preferred stocks ^{p. 39}.

Investments

	2025		2024
($ in thousands)	Carrying Value	% of Total	Carrying Value	% of Total
Cash and cash equivalents	168,544	6.8%	121,603	6.1%
Short-term investments	264,299	10.7%	274,929	13.8%
Fixed income	1,866,205	75.6%	1,318,708	66.2%
Equities	1,174	0.1%	106,254	5.3%
Alternative and strategic investments	168,837	6.8%	170,929	8.6%
Total portfolio	2,469,059	100.0%	1,992,423	100.0%

Investments

	2025		2024
($ in thousands)	Carrying Value	% of Total	Carrying Value	% of Total
U.S. government securities	44,468	2.4%	26,486	2.0%
Corporate securities and miscellaneous	636,387	34.1%	425,628	32.3%
Municipal securities	102,116	5.5%	84,716	6.4%
Residential mortgage-backed securities	486,587	26.1%	393,833	29.9%
Commercial mortgage-backed securities	73,050	3.9%	69,364	5.2%
Other asset-backed securities	513,695	27.5%	292,191	22.2%
Total fixed income portfolio, available-for-sale	1,856,303	99.5%	1,292,218	98.0%
Commercial mortgage loans	9,902	0.5%	26,490	2.0%
Total fixed income portfolio	1,866,205	100.0%	1,318,708	100.0%

Investments

	2025		2024
($ in thousands)	Fair Value	% of Total	Fair Value	% of Total
AAA	286,563	15.4%	483,099	37.3%
AA	548,030	29.6%	141,177	10.9%
A	620,813	33.5%	429,703	33.3%
BBB	379,586	20.4%	216,602	16.8%
BB and Lower	21,311	1.1%	21,637	1.7%
Total fixed income portfolio, available-for-sale	1,856,303	100.0%	1,292,218	100.0%

Investments

	2025		2024
($ in thousands)	Fair Value	% of Total Fair Value	Fair Value	% of Total Fair Value
Domestic common equities	—	—%	70,665	66.5%
International common equities	—	—%	34,425	32.4%
Preferred stock	1,174	100.0%	1,164	1.1%
Equities	1,174	100.0%	106,254	100.0%

Investments

($ in thousands)	Estimated Fair Value	Estimated Change in Fair Value	Estimated % Increase (Decrease) in Fair Value
300 basis point increase	1,654,474	-201,829	-10.9%
200 basis point increase	1,721,816	-134,487	-7.2%
100 basis point increase	1,789,092	-67,211	-3.6%
No change	1,856,303	—	0.0%
100 basis point decrease	1,923,448	67,145	3.6%
200 basis point decrease	1,990,528	134,225	7.2%
300 basis point decrease	2,057,542	201,239	10.8%

Other Items

• Income tax expense for the year ended December 31, 2025, was USD 46.4m, compared to USD 33.9m for the year ended December 31, 2024 ^{p. 40}.
• Effective tax rate for the year ended December 31, 2025, was 21.4%, compared to 22.2% for the year ended December 31, 2024 ^{p. 40}.
• For a reconciliation between actual federal income tax expense and the amount computed at the statutory rate for the years ended December 31, 2025 and 2024, refer to Note 13, “Income Taxes” in the consolidated financial statements included in Item 8 of this Form 10-K ^{p. 40}.

Liquidity and Capital Resources

• The company is organized as a holding company, with operations primarily conducted by wholly-owned insurance subsidiaries GMIC, HSIC, IIC (domiciled in Texas), and OSIC (domiciled in Oklahoma) ^{p. 41}.
• The holding company can receive cash through: corporate service fees from operating subsidiaries; payments from the consolidated tax allocation agreement; dividends from subsidiaries (subject to limitations); bank loans; draws on a revolving loan agreement; and issuance of equity and debt securities ^{p. 41}.
• Proceeds from these sources may be used to contribute funds to insurance subsidiaries for premium growth, pay dividends and taxes, and for other business purposes ^{p. 41}.
• Skyward Service Company receives corporate service fees from operating subsidiaries to reimburse most incurred operating expenses ^{p. 41}.
• Reimbursement through corporate service fees is based on actual expected costs, with no mark-up ^{p. 41}.
• The company files a consolidated U.S. federal income tax return with its subsidiaries ^{p. 41}.
• Under the corporate tax allocation agreement, each participant is charged or refunded taxes based on what they would have paid or received if filing on a separate return basis with the IRS ^{p. 41}.
• Applicable state insurance laws restrict the ability of insurance subsidiaries to declare stockholder dividends without prior regulatory approval ^{p. 41}.
• State insurance regulators require insurance companies to maintain specified levels of statutory capital and surplus ^{p. 41}.
• Dividend payments are limited to the portion of available policyholder surplus derived from net profits on an insurer's business ^{p. 41}.
• Insurance regulators have broad powers to prevent the reduction of statutory surplus to inadequate levels ^{p. 41}.
• There is no assurance that maximum calculated dividends under any applicable formula would be permitted ^{p. 41}.
• State insurance regulatory authorities with jurisdiction over dividend payments by insurance subsidiaries may adopt more restrictive statutory provisions in the future ^{p. 41}.
• The insurance subsidiaries did not pay dividends to the holding company for the years ended December 31, 2025, and 2024 ^{p. 41}.
• Additional information regarding insurance companies is in Note 23, "Statutory Accounting Principles and Regulatory Matters," to the consolidated financial statements in Item 8 of Form 10-K ^{p. 41}.
• The holding company had cash and investments of USD 3.5m at December 31, 2025, compared to USD 2.9m at December 31, 2024 ^{p. 41}.
• Management believes there is sufficient liquidity to meet operating cash needs, obligations, and committed capital expenditures for the next 12 months ^{p. 41}.

Cash Flows

• The most significant source of cash is from premiums received from insureds, typically at the beginning of the coverage period, net of related commission ^{p. 42}.
• The most significant cash outflow is for claims arising from insured losses ^{p. 42}.
• Cash is invested in various investment securities to earn interest and dividends because claim payments occur after premium receipt, often years later ^{p. 42}.
• Cash is also used for operating expenses (salaries, rent, taxes) and capital expenditures (technology systems) ^{p. 42}.
• Reinsurance is used to manage policy risk, involving ceding part of received premiums to reinsurers and collecting cash back when covered losses are paid ^{p. 42}.
• The timing of cash flows from operating activities can vary between periods due to the timing of payments and receipts ^{p. 42}.
• Significant payments and receipts, such as loss settlements and subsequent reinsurance receipts, can influence operating cash flows in any given period ^{p. 42}.
• Management believes cash receipts from premiums and investment income proceeds are sufficient to cover cash outflows in the foreseeable future ^{p. 42}.
• The increase in cash provided by operating activities in 2025 compared to 2024 was primarily due to increased cash inflows from insurance operations ^{p. 42}.
• Cash from operations can vary due to the timing of premium receipts, claim payments, and reinsurance activity ^{p. 42}.
• Cash flows from operations in the past two years were primarily used to fund investing activities ^{p. 42}.
• Net cash used in investing activities in 2025 was primarily driven by purchases of fixed maturity securities, partially offset by sales and maturities of investment securities ^{p. 42}.
• Net cash used in investing activities in 2024 was driven by purchases of fixed maturity securities, partially offset by sales and maturities of investment securities and sales of short-term investments ^{p. 42}.

Cash Flows

($ in thousands)	2025	2024
Cash and cash equivalents provided by (used in):	—	—
Operating activities	408,076	305,115
Investing activities	-366,898	-243,694
Financing activities	411	-4,232
Change in cash and cash equivalents and restricted cash	41,589	57,189

Credit Agreements

• FHLB Loan was entered into on August 30, 2024, with the Federal Home Loan Bank of Dallas (FHLB) ^{p. 43}.
• FHLB Loan is a 4.5-year term loan with a principal amount of $57.0 million ^{p. 43}.
• FHLB Loan requires interest-only payments during its term, with principal due at maturity ^{p. 43}.
• FHLB Loan has a fixed interest rate of 4.00% over its term ^{p. 43}.
• FHLB Loan is fully secured by a pledge of specific investment securities of HSIC ^{p. 43}.
• FHLB Loan proceeds were used to fund redemptions of draws on the 2023 Revolving Credit Facility ^{p. 43}.
• Term Loan Facility was entered into during the fourth quarter of 2025 with a syndicate of participating banks ^{p. 43}.
• Term Loan Facility includes an unsecured senior delayed draw term loan facility (DDTL) of $150.0 million (Tranche A DDTL) ^{p. 43}.
• Term Loan Facility also includes an additional unsecured senior DDTL of $150.0 million (Tranche B DDTL) ^{p. 43}.
• Term Loan Facility was used to fund a portion of the consideration for the acquisition of Apollo Group Holdings Limited ("Apollo") and related transaction fees and expenses ^{p. 43}.
• Interest on Term Loan Facility is based on either term SOFR plus a margin ranging from 150 bps to 190 bps, or the base rate plus a margin ranging from 50 bps to 90 bps, depending on the debt to capitalization ratio ^{p. 43}.
• SOFR calculation for the Term Loan Facility uses a SOFR floor of 0.00% and a credit spread adjustment of 0.10% ^{p. 43}.
• Base rate for the Term Loan Facility is the highest of (i) the Agent’s then-current prime lending rate, (ii) the Federal Funds Rate plus 0.50%, (iii) SOFR plus 1.00%, and (iv) zero percent (0%) ^{p. 43}.
• Fee on undrawn amounts under the Term Loan Facility ranges from 0.20% to 0.35% of average daily undrawn amounts, depending on the debt to capitalization ratio ^{p. 43}.
• Tranche A DDTL matures on January 1, 2028 ^{p. 43}.
• Tranche B DDTL matures on July 2, 2029 ^{p. 43}.
• Draws on Term Loan Facility: $150 million of Tranche A DDTL and $150 million of Tranche B DDTL were drawn on December 30, 2025, for the Apollo acquisition on January 1, 2026 ^{p. 43}.
• Term Loan Facility covenants include limitations on additional indebtedness exceeding $10.0 million, restrictions on distributions to stockholders, and financial covenants related to minimum consolidated net worth, maximum total debt to capitalization, minimum A.M. Best rating, and minimum liquidity ^{p. 43}.
• Compliance with covenants: As of December 31, 2025, the company was in compliance with all Term Loan Facility covenants ^{p. 43}.
• Term Loan Facility is unsecured ^{p. 43}.
• Guaranty agreement was entered into during the fourth quarter of 2025, where obligations under the Term Loan Facility are guaranteed by the company and its wholly-owned subsidiaries (excluding insurance company subsidiaries and with certain other exceptions) ^{p. 43}.
• Revolving Credit Facility was entered into during the fourth quarter of 2025 with a syndicate of participating banks ^{p. 43}.
• Revolving Credit Facility is unsecured ^{p. 43}.
• Initial maximum principal amount of the Revolving Credit Facility was $150.0 million, which increased to $250.0 million on the closing date of the Apollo acquisition ^{p. 43}.
• Revolving Credit Facility was amended during the fourth quarter of 2025 to permit funding of certain revolving loans for the Apollo acquisition ^{p. 43}.
• Initial draw on the Revolving Credit Facility was $43.0 million, used to redeem the prior revolving credit facility ^{p. 43}.
• Additional draw of $71.5 million was made on December 30, 2025, for the Apollo acquisition consideration ^{p. 43}.
• Proceeds from draws on the Term Loan Facility and Revolving Credit Facility are presented net with liabilities on the Consolidated Balance Sheets for the year ended December 31, 2025 ^{p. 43}.
• Interest on Revolving Credit Facility is payable quarterly ^{p. 43}.
• Interest rate on drawn amounts under the Revolving Credit Facility is either term SOFR plus a margin ranging from 150 bps to 190 bps, or the base rate plus a margin ranging from 50 bps to 90 bps, depending on the debt to capitalization ratio ^{p. 43}.
• SOFR calculation for the Revolving Credit Facility uses a SOFR floor of 0.00% and a credit spread adjustment of 0.10% ^{p. 43}.
• Base rate for the Revolving Credit Facility is the highest of (i) the Agent’s then current prime lending rate, (ii) the Federal Funds Rate plus 0.50%, (iii) SOFR plus 1.00%, and (iv) zero percent (0%) ^{p. 43}.
• Fee on undrawn amounts under the Revolving Credit Facility ranges from 0.20% to 0.35% of average daily undrawn amounts, depending on the debt to capitalization ratio ^{p. 43}.
• Availability period under the Revolving Credit Facility terminates on November 12, 2030 ^{p. 43}.
• Revolving Credit Facility covenants are based on minimum net worth, maximum debt to capital ratio, minimum A.M. Best Rating, and minimum liquidity ^{p. 43}.
• Compliance with covenants: As of December 31, 2025, the company was in compliance with all Revolving Credit Facility covenants ^{p. 43}.
• 2023 Revolving Credit Facility was entered into during the first quarter of 2023 ^{p. 43}.
• 2023 Revolving Credit Facility provided up to a $150.0 million revolving credit facility and a letter of credit sub-facility of up to $30.0 million ^{p. 43}.
• Redemption of 2023 Revolving Credit Facility occurred on November 13, 2025 ^{p. 43}.
• Accrued interest paid for the 2023 Revolving Credit Facility was $0.3 million ^{p. 43}.
• Expense recognized for remaining unamortized deferred financing costs of the 2023 Revolving Credit Facility was $0.6 million ^{p. 43}.
• Notes (Debentures): In May 2019, an agreement was entered into to issue unsecured subordinated notes with an aggregate principal amount of $20.0 million ^{p. 43}.
• Interest on Notes is fixed at 7.25% for the first 8 years and 8.25% thereafter ^{p. 43}.
• Early retirement of Notes requires all interest payments to be paid in full, plus the return of outstanding principal ^{p. 43}.
• Principal on Notes is due at maturity on May 24, 2039 ^{p. 43}.
• Interest on Notes is payable quarterly ^{p. 43}.
• Notes have junior priority to all previously issued debt ^{p. 43}.
• Debt related to Notes is reported net of debt issuance costs of approximately $0.4 million as of December 31, 2025, and $0.5 million as of December 31, 2024 ^{p. 43}.
• Deferred financing costs are presented as a direct deduction from the carrying amount of the subordinated debt ^{p. 43}.

Share Repurchase Program

• In October 2024, the Board of Directors approved a share repurchase program. ^{p. 44}
• The program authorizes the repurchase of up to $50.0 million of common stock. ^{p. 44}
• Shares may be repurchased via open market purchases, privately-negotiated transactions, block purchases, accelerated share repurchase agreements, or a combination of methods, including Rule 10b5-1 trading plans. ^{p. 44}
• The timing, manner, price, and amount of repurchases are at the company's discretion. ^{p. 44}
• The program does not mandate the repurchase of any specific number of shares and can be modified, suspended, or terminated at any time. ^{p. 44}
• As of December 31, 2025, no shares had been repurchased under this plan. ^{p. 44}

Contractual Obligations and Commitments

• Reserves for losses and LAE represent the best estimate of the ultimate cost of settling reported and unreported claims and related expenses ^{p. 45}.
• Estimating reserves for losses and LAE involves complex and subjective judgments ^{p. 45}.
• Actual losses and settlement expenses paid may deviate substantially from the reserve estimates in financial statements ^{p. 45}.
• The timing for payment of estimated losses is not fixed or individually/aggregately determinable ^{p. 45}.
• Assumptions for estimating payments due by period are based on the company's, industry's, and peer group's claims payment experience ^{p. 45}.
• There is a risk that actual payments in any period will differ significantly from disclosed amounts due to uncertainty in timing estimation ^{p. 45}.
• Disclosed amounts are gross of anticipated recoverable amounts from reinsurers ^{p. 45}.
• Reinsurance balances recoverable on reserves for losses and LAE are reported separately as assets, not netted with liabilities, because reinsurance does not discharge the company's liability to policyholders ^{p. 45}.
• Reinsurance balances recoverable on reserves for paid and unpaid losses and LAE totaled $1,119.9 million at December 31, 2025 ^{p. 45}.
• Reinsurance balances recoverable on reserves for paid and unpaid losses and LAE totaled $857.9 million at December 31, 2024 ^{p. 45}.

Contractual Obligations and Commitments

	Payments due by period
($ in thousands)	Total	Less Than One Year	One Year or More
Reserves for losses and LAE	2,318,894	524,329	1,794,565
Long-term debt	548,500	—	548,500
Interest on debt obligations	107,070	26,828	80,242
Total	2,974,464	551,157	2,423,307

Critical Accounting Policies

• Critical accounting estimates are those important to portraying financial condition and results of operations and require significant judgment ^{p. 46}.
• Significant judgment is exercised concerning future results and developments in applying critical accounting estimates and preparing consolidated financial statements ^{p. 46}.
• Judgments and estimates affect reported amounts of assets, liabilities, revenues, expenses, and disclosure of material contingent assets and liabilities ^{p. 46}.
• Actual results may differ materially from estimates and assumptions used in preparing consolidated financial statements ^{p. 46}.
• Estimates are evaluated regularly using relevant information ^{p. 46}.
• For a detailed discussion of accounting policies, refer to Note 1, “Summary of Significant Accounting Policies” in Item 8 of this Form 10-K ^{p. 46}.
• Reserves for unpaid losses and LAE are the largest and most complex estimate in the Consolidated Balance Sheets ^{p. 46}.
• Reserves for unpaid losses and LAE represent the estimated ultimate cost of all unreported and reported but unpaid insured claims and the cost to adjust these losses as of or before the balance sheet date ^{p. 46}.
• Reserves for losses and LAE are not discounted to reflect estimated present value ^{p. 46}.
• Reserves are estimated using individual case-basis valuations of reported claims, statistical analyses, and various actuarial procedures ^{p. 46}.
• Estimates are based on historical information, industry and peer group information, and estimates of future trends in variable factors like loss severity, loss frequency, and inflation ^{p. 46}.
• Estimates are regularly reviewed and adjusted as experience develops or new information becomes known ^{p. 46}.
• During the loss settlement period, estimates of liability on a claim are often refined and adjusted upward or downward ^{p. 46}.
• The ultimate liability may exceed or be less than revised estimates ^{p. 46}.
• The ultimate settlement of losses and related LAE may vary significantly from the estimate included in financial statements ^{p. 46}.
• Reserves for unpaid losses and LAE are categorized into two types: case reserves and IBNR ^{p. 46}.
• Case reserves are established for individual claims reported to the company ^{p. 46}.
• Losses are notified by insureds, their agents, or brokers ^{p. 46}.
• Case reserves are established by estimating ultimate losses from the claim, including defense costs ^{p. 46}.
• Claims department personnel use their knowledge of specific claims and advice from internal and external experts (underwriters, legal counsel) to estimate expected ultimate losses ^{p. 46}.
• Third-Party Administrators (TPAs) are used in limited circumstances to assist in claim adjustment ^{p. 46}.
• Internal claims managers oversee TPA activities and monitor their claim handling to prescribed standards ^{p. 46}.
• Incurred but not reported (IBNR) reserve is derived by estimating the ultimate unpaid reserve liability and subtracting case reserves ^{p. 46}.
• Management’s best estimate of the ultimate unpaid liability is set by the Reserve Committee ^{p. 46}.
• The Reserve Committee considers actuarial indications and other factors such as underwriting, claims handling, economic, legal, and environmental changes ^{p. 46}.
• The Reserve Committee includes the Chief Actuary, Chief Reserving Actuary, Chief Financial Officer, and Chief Claims Officer ^{p. 46}.
• The Reserve Committee meets quarterly to review actuarial reserving recommendations from the Chief Actuary and determine the best estimate for the reserve for losses and LAE ^{p. 46}.
• In establishing quarterly actuarial recommendations, the actuary estimates an initial expected ultimate loss ratio for each underwriting division ^{p. 46}.
• Input from underwriting and claims departments, including premium pricing assumptions and historical experience, is considered in setting reserves ^{p. 46}.
• Reserves are driven by factors including litigation and regulatory trends, legislative activity, climate change, social and economic patterns, and claims inflation assumptions ^{p. 46}.
• Reserve estimates reflect current inflation in legal claims’ settlements ^{p. 46}.
• Reserve estimates assume no subjection to losses from significant new legal liability theories ^{p. 46}.
• Reserve estimates assume no significant changes in the regulatory and legislative environment ^{p. 46}.
• The impact of potential changes in the regulatory or legislative environment is difficult to quantify without specific, significant new regulation or legislation ^{p. 46}.
• In the event of significant new regulation or legislation, the company will attempt to quantify its impact, but accuracy or success is not assured ^{p. 46}.
• The actuarial review considers multiple actuarial methods to estimate the reserve for losses and LAE ^{p. 46}.
• Actuarial methods include paid and incurred loss development methods, paid and incurred Bornhuetter-Ferguson methods, paid and incurred loss ratio cape cod methods, and frequency and severity methods ^{p. 46}.
• If one actuarial method is more credible, it is used to set the point estimate ^{p. 46}.
• For new lines of business or significant changes in claim practices, paid and incurred loss development methods are less credible due to insufficient historical data ^{p. 46}.
• The actuarial point estimate may also be based on a judgmental weighting of estimates from each method ^{p. 46}.
• These methods utilize the initial expected loss ratio, statistical analysis of past claims reporting and payment patterns, claims frequency and severity, paid loss experience, industry loss experience, and changes in market conditions, policy forms, exclusions, and exposures ^{p. 46}.
• Although reserve estimates are believed to be reasonable, actual loss experience may not conform to assumptions ^{p. 46}.
• Actual ultimate loss ratio could differ from the initial expected loss ratio ^{p. 46}.
• Actual reporting and payment patterns could differ from expected patterns, which are based on company and industry data ^{p. 46}.
• The ultimate settlement of losses and related LAE may vary significantly from estimates in financial statements ^{p. 46}.
• Estimates are regularly reviewed and adjusted as experience develops or new information becomes known, with adjustments included in current operations ^{p. 46}.
• Development is the amount by which estimated losses differ from those originally reported for a period ^{p. 46}.
• Development is unfavorable when losses settle for more than reserved or subsequent estimates indicate reserve increases ^{p. 46}.
• Development is favorable when losses settle for less than reserved or subsequent estimates indicate reserve reductions ^{p. 46}.
• Favorable or unfavorable development of loss reserves is reflected in the results of operations in the period estimates are changed ^{p. 46}.
• A 5% change in net IBNR would result in a $51.8 million change in reserves for losses and LAE ^{p. 46}.
• A 5% change in net IBNR would result in a $40.9 million change in net income and stockholders’ equity ^{p. 46}.

Critical Accounting Policies

	2025				2024
($ in thousands)	Gross	% of Total	Net	% of Total	Gross	% of Total	Net	% of Total
Case reserves	625,710	27.0%	362,291	25.9%	567,192	31.8%	342,612	30.8%
IBNR	1,693,184	73.0%	1,035,438	74.1%	1,215,191	68.2%	768,925	69.2%
Total	2,318,894	100.0%	1,397,729	100.0%	1,782,383	100.0%	1,111,537	100.0%

Recent Accounting Pronouncements

• In December 2023, the FASB issued ASU 2023-09, "Improvements to Income Tax Disclosures (Topic 740)" ^{p. 47}.
• ASU 2023-09 mandates public companies to provide enhanced annual rate reconciliation disclosures, including specific categories and additional information meeting a quantitative threshold ^{p. 47}.
• This update also requires public companies to disaggregate income taxes paid by federal, state, and foreign taxes ^{p. 47}.
• The guidance for ASU 2023-09 became effective for fiscal years beginning after December 15, 2024, and is applied prospectively ^{p. 47}.
• The company has added additional disclosures as required by ASU 2023-09, with no impact on the consolidated financial statements ^{p. 47}.
• In November 2024, the FASB issued ASU 2024-03, requiring disaggregated disclosure of income statement expenses for public business entities (PBEs) ^{p. 47}.
• ASU 2024-03 does not alter expense captions on the income statement but requires disaggregation of certain expense captions into specified categories in financial statement footnotes ^{p. 47}.
• ASU 2024-03 mandates a footnote disclosure for specific expenses, requiring PBEs to disaggregate, in a tabular presentation, relevant income statement expense captions that include any of the following natural expenses: (1) purchases of inventory, (2) employee compensation, (3) depreciation, (4) intangible asset amortization, and (5) depreciation, depletion, and amortization recognized as part of oil- and gas-producing activities or other types of depletion expenses ^{p. 47}.
• The tabular disclosure would also include certain other expenses, where applicable ^{p. 47}.
• In January 2025, the FASB issued ASU 2025-01 to clarify the effective date of ASU 2024-03 ^{p. 47}.
• The effective date for ASU 2024-03 is the first annual reporting period beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027 ^{p. 47}.
• The company is evaluating the effect of the amendments on its consolidated financial statements ^{p. 47}.

Quantitative and Qualitative Disclosures About Market Risk

• Qualitative and Quantitative Disclosures about Market Risk are included in Item 7 of this Form 10-K under "Investments—Market Risk" ^{p. 48}.

Financial Statements

Report of Independent Registered Public Accounting Firm

• Opinion: The consolidated financial statements present fairly, in all material respects, the financial position of Skyward Specialty Insurance Group, Inc. and its subsidiaries as of December 31, 2023 and 2022, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2023, in conformity with U.S. generally accepted accounting principles ^{p. 49}.
• Internal Control Over Financial Reporting: The Company maintained effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) ^{p. 49}.
• Basis for Opinion: The audit was conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB) ^{p. 49}.
• Responsibilities of the Auditor: The auditor is a public accounting firm registered with the PCAOB and is required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB ^{p. 49}.
• Audit Scope: The audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks ^{p. 49}.
• Critical Audit Matters: Critical audit matters are those matters arising from the audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved especially challenging, subjective, or complex auditor judgments ^{p. 49}.
• No Critical Audit Matters: The auditor determined that there were no critical audit matters ^{p. 49}.
• Auditor: Ernst & Young LLP ^{p. 49}.
• Location: Houston, Texas ^{p. 49}.
• Date: February 28, 2024 ^{p. 49}.

Opinion on Internal Control Over Financial Reporting

• Internal control over financial reporting of Skyward Specialty Insurance Group, Inc. and subsidiaries was audited as of December 31, 2025 ^{p. 50}.
• The audit was based on criteria established in the Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria) ^{p. 50}.
• Skyward Specialty Insurance Group, Inc. and subsidiaries maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on the COSO criteria ^{p. 50}.
• The consolidated balance sheets of the Company as of December 31, 2025 and 2024, and related consolidated statements of operations and comprehensive income, stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2025, were audited in accordance with PCAOB standards ^{p. 50}.
• The report dated March 2, 2026 expressed an unqualified opinion on the consolidated financial statements and related notes and schedules ^{p. 50}.

Basis for Opinion

• The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment included in the accompanying Management’s Report on Internal Control over Financial Reporting ^{p. 51}.
• The auditor's responsibility is to express an opinion on the Company’s internal control over financial reporting based on their audit ^{p. 51}.
• The auditor is a public accounting firm registered with the PCAOB and is required to be independent in accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB ^{p. 51}.
• The audit was conducted in accordance with the standards of the PCAOB ^{p. 51}.
• PCAOB standards require planning and performing the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects ^{p. 51}.
• The audit included obtaining an understanding of internal control over financial reporting, assessing the risk of a material weakness, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing other necessary procedures ^{p. 51}.
• The auditor believes their audit provides a reasonable basis for their opinion ^{p. 51}.

Definition and Limitations of Internal Control Over Financial Reporting

• Internal control over financial reporting is a process designed to provide reasonable assurance about the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles ^{p. 52}.
• Internal control over financial reporting includes policies and procedures that maintain records accurately reflecting transactions and asset dispositions ^{p. 52}.
• Internal control over financial reporting provides reasonable assurance that transactions are recorded to permit financial statement preparation in accordance with GAAP, and that receipts and expenditures align with management and director authorizations ^{p. 52}.
• Internal control over financial reporting provides reasonable assurance regarding the prevention or timely detection of unauthorized acquisition, use, or disposition of company assets that could materially affect financial statements ^{p. 52}.
• Internal control over financial reporting has inherent limitations and may not prevent or detect misstatements ^{p. 52}.
• Projections of effectiveness evaluations to future periods carry the risk that controls may become inadequate due to changing conditions or that compliance with policies/procedures may deteriorate ^{p. 52}.

Caption: Definition and Limitations of Internal Control Over Financial Reporting

| /s/ Ernst & Young LLP | | --- | | Houston, Texas | | March 2, 2026 |

Report of Independent Registered Public Accounting Firm

• Opinion: The consolidated financial statements present fairly, in all material respects, the financial position of Skyward Specialty Insurance Group, Inc. and its subsidiaries as of December 31, 2023 and 2022, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America ^{p. 53}.
• Internal Control Over Financial Reporting: The Company maintained effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) ^{p. 53}.
• Basis for Opinions: The audits were conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB) ^{p. 53}.
• Responsibilities of the Auditors: The auditors are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB ^{p. 53}.
• Audit Scope: The audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks ^{p. 53}.
• Audit Procedures: Procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements, evaluating the accounting principles used and significant estimates made by management, and evaluating the overall presentation of the financial statements ^{p. 53}.
• Internal Control Audit Scope: The audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk ^{p. 53}.
• Material Weakness Definition: A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis ^{p. 53}.
• Auditor's Conclusion on Internal Control: The auditors believe that their audits provide a reasonable basis for their opinions ^{p. 53}.
• Critical Audit Matters (CAMs): CAMs are matters arising from the audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved especially challenging, subjective, or complex auditor judgment ^{p. 53}.
• No CAMs Identified: The auditors determined that there were no critical audit matters ^{p. 53}.
• Auditor Firm: Ernst & Young LLP ^{p. 53}.
• Auditor Location: Houston, Texas ^{p. 53}.
• Report Date: February 29, 2024 ^{p. 53}.

Opinion on the Financial Statements

• The consolidated financial statements of Skyward Specialty Insurance Group, Inc. and subsidiaries (the Company) as of December 31, 2025 and 2024, and for the three years ended December 31, 2025, have been audited ^{p. 54}.
• The audit included the consolidated balance sheets, statements of operations and comprehensive income, stockholders' equity, and cash flows, along with related notes and financial statement schedules ^{p. 54}.
• The consolidated financial statements fairly present, in all material respects, the Company's financial position as of December 31, 2025 and 2024, and its operational results and cash flows for the three years ended December 31, 2025, in conformity with U.S. generally accepted accounting principles ^{p. 54}.
• The Company's internal control over financial reporting as of December 31, 2025, was also audited in accordance with PCAOB standards ^{p. 54}.
• The audit of internal control was based on criteria from the 2013 framework of Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ^{p. 54}.
• The report dated March 2, 2026, expressed an unqualified opinion on the Company's internal control over financial reporting ^{p. 54}.

Basis for Opinion

• The Company's management is responsible for the financial statements ^{p. 55}.
• The auditor's responsibility is to express an opinion on the Company's financial statements based on their audits ^{p. 55}.
• The auditor is a public accounting firm registered with the PCAOB and must be independent of the Company according to U.S. federal securities laws and SEC/PCAOB rules and regulations ^{p. 55}.
• Audits were conducted in accordance with PCAOB standards ^{p. 55}.
• PCAOB standards require planning and performing audits to obtain reasonable assurance that financial statements are free of material misstatement due to error or fraud ^{p. 55}.
• Audit procedures included assessing risks of material misstatement and responding to those risks ^{p. 55}.
• Procedures involved examining evidence on a test basis regarding amounts and disclosures in the financial statements ^{p. 55}.
• Audits also included evaluating accounting principles, significant management estimates, and the overall presentation of financial statements ^{p. 55}.
• The auditors believe their audits provide a reasonable basis for their opinion ^{p. 55}.

Critical Audit Matter

• The critical audit matter discussed arises from the current period audit of the financial statements ^{p. 56}.
• This matter was communicated or required to be communicated to the audit committee ^{p. 56}.
• The critical audit matter relates to accounts or disclosures material to the financial statements ^{p. 56}.
• The matter involved especially challenging, subjective, or complex judgments ^{p. 56}.
• The communication of this critical audit matter does not alter the opinion on the consolidated financial statements as a whole ^{p. 56}.
• Communicating the critical audit matter does not provide a separate opinion on the matter or its related account/disclosure ^{p. 56}.

Valuation of Reserves for Unpaid Losses and Loss Adjustment Expenses

• Company’s reserves for unpaid losses and loss adjustment expenses (LAE) were USD 2.3bn at December 31, 2025 ^{p. 57}.
• A significant portion of these reserves represents incurred but not reported reserves (IBNR) ^{p. 57}.
• Reserves for unpaid losses and LAE represent the estimated ultimate cost of all unreported and reported but unpaid insured claims and the cost to adjust incurred losses as of the balance sheet date ^{p. 57}.
• The Company estimates these reserves using individual case-basis valuations of reported claims, statistical analyses, and various actuarial procedures ^{p. 57}.
• Estimates are based on historical information, industry and peer group information, and trends in factors like loss severity, loss frequency, and inflation ^{p. 57}.
• Auditing management's estimate of reserves for unpaid losses and LAE, including IBNR, was complex due to significant estimation uncertainty in evaluating management's methods and assumptions ^{p. 57}.
• Key assumptions include loss development factors, expected loss ratios, and trends applied to the Company’s historical experience ^{p. 57}.
• These assumptions significantly affect the valuation of IBNR reserves ^{p. 57}.
• We obtained an understanding, evaluated the design, and tested the operating effectiveness of internal controls over management’s process for estimating losses and LAE reserves ^{p. 57}.
• This included reviewing and approving management's methods and assumptions for estimating reserves ^{p. 57}.
• With actuarial specialists, audit procedures included evaluating the selection of actuarial methods used by management, comparing them to prior periods and industry practices ^{p. 57}.
• We evaluated the assumptions used in actuarial methods by comparing significant assumptions (loss development factors, expected loss ratios, trends) to the Company’s historical experience and current industry benchmarks ^{p. 57}.
• We developed an independent range of reserve estimates and compared it to management’s best estimate for unpaid losses and LAE ^{p. 57}.
• We also reviewed the development of prior year reserve estimates ^{p. 57}.

Caption: Valuation of Reserves for Unpaid Losses and Loss Adjustment Expenses

| /s/ Ernst & Young LLP | | --- | | We have served as the Company’s auditor since 2021. | | Houston, Texas | | March 2, 2026 |

Consolidated balance sheets

• The accompanying notes are an integral part of the consolidated financial statements ^{p. 58}.

Consolidated balance sheets

	December 31,
	2025	2024
($ in thousands, except share and per share amounts)
Assets
Investments:	—	—
Fixed maturity securities, available-for-sale, at fair value (net of allowance for credit losses of $ 7,000 and $ 0 , respectively) (amortized cost of $ 1,848,755 and $ 1,320,266 , respectively)	1,856,303	1,292,218
Fixed maturity securities, held-to-maturity, at amortized cost (net of allowance for credit losses of $ 468 and $ 243 , respectively)	32,822	39,153
Equity securities, at fair value	1,174	106,254
Mortgage loans, at fair value	9,902	26,490
Equity method investments	77,365	98,594
Other long-term investments	58,650	33,182
Short-term investments, at fair value	264,299	274,929
Total investments	2,300,515	1,870,820
Cash and cash equivalents	168,544	121,603
Restricted cash	30,570	35,922
Premiums receivable, net	544,217	321,641
Reinsurance recoverables, net	1,119,880	857,876
Ceded unearned premium	238,948	203,901
Deferred policy acquisition costs	136,100	113,183
Deferred income taxes	27,865	30,486
Goodwill and intangible assets, net	88,040	87,348
Other assets	137,173	86,698
Total assets	4,791,852	3,729,478
Liabilities and stockholders’ equity	—	—
Reserves for losses and loss adjustment expenses	2,318,894	1,782,383
Unearned premiums	774,035	637,185
Deferred ceding commission	46,453	40,434
Reinsurance and premium payables	279,888	177,070
Funds held for others	128,003	102,665
Accounts payable and accrued liabilities	115,034	76,206
Notes payable	100,411	100,000
Subordinated debt, net of debt issuance costs	19,569	19,536
Total liabilities	3,782,287	2,935,479
Stockholders’ equity	—	—
Common stock, $ 0.01 par value, 500,000,000 shares authorized, 40,511,222 and 40,127,908 shares issued and outstanding, respectively	405	401
Additional paid-in capital	730,555	718,598
Accumulated other comprehensive income (loss)	11,457	( 22,120 )
Retained earnings	267,148	97,120
Total stockholders’ equity	1,009,565	793,999
Total liabilities and stockholders’ equity	4,791,852	3,729,478

Consolidated statements of operations and comprehensive income

• The accompanying notes are an integral part of the consolidated financial statements ^{p. 59}.

Consolidated statements of operations and comprehensive income

	Years Ended December 31,
($ in thousands, except share and per share amounts)	2025	2024	2023
Revenues:	—	—	—
Net earned premiums	1,304,505	1,056,722	829,143
Commission and fee income	6,855	6,703	6,064
Net investment income	83,619	80,600	40,340
Net investment gains	22,149	6,342	11,054
Other loss	( 587 )	( 167 )	( 632 )
Total revenues	1,416,541	1,150,200	885,969
Losses and loss adjustment expenses	795,022	669,809	515,237
Underwriting, acquisition and insurance expenses	377,359	311,757	243,444
Transaction costs	14,019	—	—
Interest expense	7,919	9,496	10,024
Amortization expense	1,636	2,007	1,798
Other expenses	4,162	4,392	5,364
Total expenses	1,200,117	997,461	775,867
Income before income taxes	216,424	152,739	110,102
Income tax expense	46,396	33,911	24,118
Net income	170,028	118,828	85,984
Net income attributable to participating securities	—	—	1,677
Net income attributable to common stockholders	170,028	118,828	84,307
Net income	170,028	118,828	85,984
Unrealized gains and losses on investments:	—	—	—
Net change in unrealized gains on investments, net of tax	33,092	9,792	25,516
Reclassification adjustment for gains (losses) on securities no longer held, net of tax	485	( 8,959 )	( 4,984 )
Total other comprehensive income	33,577	833	20,532
Comprehensive income	203,605	119,661	106,516
Basic earnings per share	4.21	2.97	2.34
Diluted earnings per share	4.07	2.87	2.24
Weighted-average common shares outstanding	—	—	—
Basic	40,407,310	40,056,475	36,031,907
Diluted	41,808,046	41,377,460	38,317,534

Consolidated statements of stockholders’ equity

• The accompanying notes are an integral part of the consolidated financial statements ^{p. 60}.

Consolidated statements of stockholders’ equity

	Years Ended December 31,
($ in thousands, except share amounts)	2025	2024	2023
Preferred shares:	—	—	—
Balance at beginning of year	—	—	1,969,660
Preferred stock conversion to common shares	—	—	( 1,969,660 )
Balance at December 31	—	—	—
Balance at beginning of year	40,127,908	39,863,756	16,599,666
Issuance of shares	383,314	264,152	6,958,977
Preferred stock conversion to common shares	—	—	16,305,113
Balance at December 31	40,511,222	40,127,908	39,863,756
Balance at beginning of year	—	—	20
Balance at December 31	—	—	—
Common stock:	—	—	—
Balance at beginning of year	401	399	168
Issuance of common stock	4	2	22
Proceeds from equity offerings, net	—	—	48
Balance at December 31	405	401	399
Balance at beginning of year	—	—	( 2 )
Balance at December 31	—	—	—
Additional paid-in capital:	—	—	—
Balance at beginning of year	718,598	710,855	577,289
Issuance of common stock	11,957	7,743	9,213
Proceeds from equity offerings, net	—	—	124,496
Balance at December 31	730,555	718,598	710,855
Stock notes receivable:	—	—	—
Balance at beginning of year	—	( 5,562 )	( 6,911 )
Employee equity transactions	—	5,562	1,349
Balance at December 31	—	—	( 5,562 )
Accumulated other comprehensive income (loss):	—	—	—
Balance at beginning of year	( 22,120 )	( 22,953 )	( 43,485 )
Other comprehensive income, net of tax	33,577	833	20,532
Balance at December 31	11,457	( 22,120 )	( 22,953 )
Retained earnings (accumulated deficit):	—	—	—
Balance at beginning of year	97,120	( 21,708 )	( 105,417 )
Cumulative effect on adoption of ASU No. 2016-13	—	—	( 2,275 )
Net income	170,028	118,828	85,984
Balance at December 31	267,148	97,120	( 21,708 )
Total stockholders’ equity	1,009,565	793,999	661,031

Consolidated statements of cash flows

• The accompanying notes are an integral part of the consolidated financial statements ^{p. 61}.

Consolidated statements of cash flows (1)(footnote: The sum of cash and cash equivalents and restricted cash from the Consolidated Balance Sheets.)

	Years Ended December 31,
($ in thousands)	2025	2024	2023
Cash flows from operating activities:	—	—	—
Net income	170,028	118,828	85,984
Net investment (gains) losses	( 22,149 )	( 6,342 )	( 11,054 )
Depreciation and amortization expense	3,535	3,358	3,891
Stock-based compensation expense	11,960	9,395	8,525
Undistributed earnings (loss) from long-term investments	10,122	( 6,252 )	6,730
Net change in fair value of derivatives	( 34,857 )	—	—
Deferred income tax, net	( 6,397 )	( 8,708 )	9,383
Premiums receivable, net	( 222,576 )	( 142,406 )	( 40,020 )
Reinsurance recoverables, net	( 262,004 )	( 261,542 )	( 17,270 )
Ceded unearned premium	( 35,047 )	( 17,780 )	( 28,476 )
Deferred policy acquisition costs	( 22,917 )	( 21,228 )	( 23,017 )
Federal income taxes	1,797	4,500	( 1,892 )
Losses and loss adjustment expenses	536,511	467,882	172,744
Unearned premiums	136,850	84,653	110,023
Deferred ceding commission	6,019	3,377	7,208
Reinsurance and premium payables	102,818	26,914	36,460
Funds held for others	25,338	44,077	21,730
Accounts payable and accrued liabilities	37,032	19,177	2,285
Other, net	( 27,987 )	( 12,788 )	( 5,047 )
Net cash provided by operating activities	408,076	305,115	338,187
Purchase of fixed maturity securities, available-for-sale	( 910,039 )	( 617,606 )	( 459,672 )
Purchase of illiquid investments	—	( 75 )	( 1,675 )
Purchase of equity securities	( 13,213 )	( 14,077 )	( 26,009 )
Purchase of equity method investments and other long-term investments	( 6,814 )	( 32,173 )	—
Purchase of intangible assets and goodwill	( 2,000 )	—	( 50 )
Investment in direct and indirect loans	19,674	27,480	2,984
Purchase of property and equipment	( 5,454 )	( 4,224 )	( 3,108 )
Proceeds from the sales of fixed maturity securities, available-for-sale	198,195	217,468	26,626
Maturities, calls, transfers and paydowns of fixed maturity securities, available-for-sale	183,951	122,694	48,957
Maturities, calls and paydowns of fixed maturity securities held-to-maturity	4,357	6,015	11,444
Proceeds from the sales of equity securities	126,738	37,534	40,201
Sales of and distributions from equity method and other long-term investments	11,902	14,073	3,572
Change in short-term investments	10,626	( 4,799 )	( 149,068 )
Change in receivable/payable for securities	11,928	34	76
Cash provided by deposit accounting	3,251	3,962	11,913
Net cash used in investment activities	( 366,898 )	( 243,694 )	( 493,809 )
Employee share purchases	—	—	1,350
Repayment of stock notes receivable	—	5,562	—
Proceeds from long term borrowings	43,411	107,000	50,000
Payments on long term borrowings and trust preferred	( 43,000 )	( 116,794 )	( 50,000 )
Proceeds from initial public offering	—	—	129,597
Net cash provided by (used in) financing activities	411	( 4,232 )	130,947
Net increase (decrease) in cash and cash equivalents and restricted cash	41,589	57,189	( 24,675 )
Cash and cash equivalents and restricted cash at beginning of period (1)	157,525	100,336	125,011
Cash and cash equivalents and restricted cash at end of period (1)	199,114	157,525	100,336
Supplemental disclosure of cash flow information:	—	—	—
Cash paid for interest	6,149	8,573	10,667

A. Description of Business

• Skyward Specialty Insurance Group, Inc. (the "Company") is a Delaware corporation organized in 2006 ^{p. 62}.
• The Company operates as a specialty insurance company in one segment, providing commercial property and casualty insurance products through its underwriting divisions ^{p. 62}.
• The Company has four wholly owned insurance company subsidiaries based in the United States ^{p. 62}.
  • Great Midwest Insurance Company (GMIC) underwrites insurance on an admitted basis and is a certified surety bond company listed with the U.S. Department of the Treasury ^{p. 62}.
  • Houston Specialty Insurance Company (HSIC), a subsidiary of GMIC, underwrites insurance on a non-admitted basis ^{p. 62}.
  • Imperium Insurance Company (IIC), a subsidiary of HSIC, underwrites insurance on an admitted basis ^{p. 62}.
  • Oklahoma Specialty Insurance Company (OSIC), a subsidiary of IIC, underwrites insurance on a non-admitted basis ^{p. 62}.
• The Company has a wholly owned captive reinsurance company subsidiary, Skyward Re, domiciled in the Cayman Islands ^{p. 62}.
  • Skyward Re assumed net reserves for certain divisions, related to a retroactive reinsurance contract, from the Company’s insurance companies ^{p. 62}.
  • Skyward Re retroceded these net reserves to a third-party reinsurer ^{p. 62}.
• The Company has three non-risk bearing wholly owned subsidiaries ^{p. 62}.
  • Skyward Underwriters Agency, Inc. (SUA) is a managing general insurance agent and reinsurance broker for property and casualty risks in specialty niche markets ^{p. 62}.
  • Skyward Service Company provides various administrative services to the Company’s subsidiaries ^{p. 62}.
  • Skyward Specialty No. 1 Limited is a Lloyd’s corporate member authorized to invest in Lloyd’s syndicates ^{p. 62}.
• On January 1, 2026, the Company completed the acquisition of Apollo Group Holdings Limited for an aggregate consideration of approximately $555.0 million ^{p. 62}.
• Additional information regarding the acquisition is provided in Note 24 ^{p. 62}.

B.     Basis of Presentation

• The Company's consolidated financial statements are prepared according to Generally Accepted Accounting Principles in the United States of America (GAAP) ^{p. 63}.
• GAAP differs in some aspects from the principles used in reports to insurance regulatory authorities ^{p. 63}.
• The consolidated financial statements encompass the accounts of the holding company and its subsidiaries ^{p. 63}.
• All intercompany transactions and balances are eliminated during consolidation ^{p. 63}.
• Preparing consolidated financial statements under GAAP necessitates the Company making estimates and assumptions that influence the amounts reported in the financial statements and notes ^{p. 63}.
• The Company's actual results may vary from these estimates ^{p. 63}.

C.    Consolidation

• The Company consolidates an entity if it meets the definition of a variable interest entity (VIE) for which the Company is the primary beneficiary, or if the Company controls the entity through a majority of voting interest or other arrangements ^{p. 64}.
• A VIE is defined as an entity that either lacks sufficient equity to finance its activities without additional subordinated financial support, whose equity holders lack the characteristics of a controlling financial interest, and/or is established with non-substantive voting rights ^{p. 64}.
• The Company's assessment of VIE status involves subjectivity in determining which activities most significantly affect the VIE’s performance and estimates about current and future fair value of assets and financial performance ^{p. 64}.
• In performing the related party analysis, the Company considers qualitative and quantitative factors including the characteristics and size of its investment, ability to control or significantly influence key decisions (including de facto agents), obligation or likelihood to fund operating losses, and similarity and significance of the VIE’s business activities to those of the Company and related party ^{p. 64}.
• The determination of whether an entity is a VIE and whether the Company is the primary beneficiary involves significant judgment and depends on specific facts and circumstances at the time of assessment ^{p. 64}.
• At each reporting period, the Company reassesses changes in facts and circumstances that could alter an entity's VIE status or the Company's consolidation assessment ^{p. 64}.
• Changes in consolidation status are applied prospectively ^{p. 64}.
• If an entity is consolidated due to reassessment, its assets, liabilities, and noncontrolling interest are recorded at fair value upon initial consolidation ^{p. 64}.
• Any existing equity interest held by the Company in the entity prior to obtaining control is remeasured at fair value, potentially resulting in a gain or loss recognized upon initial consolidation ^{p. 64}.
• The Company may also deconsolidate a subsidiary following reassessment, which could result in a gain or loss depending on the carrying values of deconsolidated assets and liabilities compared to the fair value of any retained interests ^{p. 64}.
• After these assessments, the Company determined that one entity meets the definition of a VIE for which the Company is the primary beneficiary ^{p. 64}.
• Further details and required disclosures regarding this VIE are provided in Note 7 ^{p. 64}.

D.     Cash and Cash Equivalents

• Cash and cash equivalents include cash on hand and fixed maturity securities with original maturities of three months or less ^{p. 65}.
• The carrying value of the Company’s cash and cash equivalents approximates fair value ^{p. 65}.

E.    Restricted Cash

• Restricted cash is cash with a legal restriction on withdrawal or use by the consolidated group ^{p. 66}.
• The carrying value of the Company’s restricted cash approximates fair value ^{p. 66}.
• SUA collects premiums from clients, deducts commissions and applicable fees, and remits the remaining premiums to the Company’s insurance companies or third-party insurance companies ^{p. 66}.
• SUA holds unremitted insurance premiums in a fiduciary capacity for third-party insurance companies, recorded as restricted cash ^{p. 66}.
• The Company is required by state regulations to maintain assets on deposit with certain states and hold cash as collateral for certain reinsurance balances ^{p. 66}.
• Cash held in a depository account for others, or restricted by a state, is recorded as restricted cash ^{p. 66}.

F.    Investments

• Available for Sale fixed maturities are carried at fair value ^{p. 67}.
• For available-for-sale fixed maturities in an unrealized loss position, the Company first determines intent to sell or likelihood of being required to sell before maturity or cost recovery ^{p. 67}.
• If intent or likelihood of sale exists, the amortized cost is written down to fair value, with losses recognized in net investment gains on the Consolidated Statements of Operations ^{p. 67}.
• If neither sale criterion is met, the Company assesses if unrealized losses are due to credit-related factors ^{p. 67}.
• If unrealized losses are credit-related, an allowance for credit losses is determined by comparing the present value of cash flows to the amortized cost ^{p. 67}.
• Prior to 2025, changes in the allowance for credit losses were recognized in net investment income ^{p. 67}.
• As of 2025, changes in the allowance for credit losses are recognized in net investment gains, and prior periods have been updated to conform to this presentation ^{p. 67}.
• Credit losses limited by the fair value of the security are recognized in stockholders’ equity, net of taxes, as a component of accumulated other comprehensive income (loss) ^{p. 67}.
• Unrealized losses that are not credit-related continue to be recognized in stockholders’ equity, net of taxes, as a component of accumulated other comprehensive income (loss) ^{p. 67}.
• Held-to-maturity fixed maturity securities are carried at amortized cost net of an allowance for credit losses ^{p. 67}.
• The allowance for credit losses represents the current estimate of expected credit losses ^{p. 67}.
• The Company develops a historical loss rate from Moody’s multi-year cumulative loss rates for asset-backed securities ^{p. 67}.
• The historical loss rate is adjusted for current conditions and reasonable and supportable forecasts ^{p. 67}.
• Prior to 2025, changes in the allowance for credit losses for held-to-maturity securities were recognized in net investment income ^{p. 67}.
• As of 2025, changes in the allowance for credit losses for held-to-maturity securities are recognized in net investment gains, and prior periods have been updated to conform ^{p. 67}.
• Equity securities include common stock or preferred stock and mutual funds (even those primarily investing in debt securities) ^{p. 67}.
• Investments in equity securities with a readily determinable fair value are carried on the balance sheet at fair value using quoted market prices ^{p. 67}.
• Changes in the carrying value of equity securities are included in net investment gains (losses) within the Consolidated Statements of Operations ^{p. 67}.
• Mortgage loans are classified as held for investment and carried at cost adjusted for unamortized premiums, discounts, and loan fees ^{p. 67}.
• Uncollectible amounts for mortgage loans are written off in the period they are determined to be uncollectible ^{p. 67}.
• Interest on mortgage loans is recognized as interest receivable and included in other assets on the Consolidated Balance Sheets ^{p. 67}.
• The Company elected the fair value option for mortgage loans effective January 1, 2023, as targeted transition relief from ASU 2016-13 adoption ^{p. 67}.
• Under the fair value option, mortgage loans are measured at fair value, and changes in unrealized gains and losses are reported in net investment gains (losses) on the Consolidated Statements of Operations ^{p. 67}.
• Interest income and amortization for mortgage loans under the fair value option continue to be recognized in net investment income ^{p. 67}.
• Equity method investments include equity and equity securities of non-public entities and indirect investments in loans and loan collateral ^{p. 67}.
• The Company has equity investments in certain limited partnerships and corporations where it has significant influence but not control ^{p. 67}.
• The Company determined it is not the primary beneficiary of these variable interest entities and does not consolidate them ^{p. 67}.
• The equity method is used to account for investments in unconsolidated subsidiaries ^{p. 67}.
• Under the equity method, initial investment is recorded at cost and adjusted based on proportionate share of distributions and net income or loss of the investee ^{p. 67}.
• The difference between investment cost and proportionate share of underlying equity is a component of investment income ^{p. 67}.
• The Company amortizes this difference as an adjustment to its pro-rata share of equity method income over the useful life of the underlying asset ^{p. 67}.
• For equity securities of non-public entities where the Company lacks significant influence and fair value is not readily determinable, investments are carried at cost, minus impairment, and adjusted for observable price changes in orderly transactions ^{p. 67}.
• Investments in indirect collateralized loans and loan collateral are held through and accounted for as ownership interests in unconsolidated subsidiaries ^{p. 67}.
• The Company’s ownership interests in unconsolidated subsidiaries include investments in partnerships, joint ventures, and special purpose investment vehicles ^{p. 67}.
• The Company uses the equity method for these unconsolidated subsidiaries where it has significant influence but not control ^{p. 67}.
• Other long-term investments consist of an investment in a limited partnership held at net asset value (“NAV”) and other long-term investment securities ^{p. 67}.
• Short-term investments primarily consist of money market funds and are carried at cost, which approximates fair value ^{p. 67}.
• Net investment income includes interest, dividends, and equity in earnings (losses) of unconsolidated subsidiaries, net of investment expenses ^{p. 67}.
• Interest income is recognized on an accrual basis, and dividends are recognized as earned at the ex-dividend date ^{p. 67}.
• Interest income on mortgage-backed and other asset-backed securities is recognized using the effective-yield method based on estimated principal repayments ^{p. 67}.
• Amortization of premium and accretion of discounts on debt securities are included in interest income ^{p. 67}.
• Net investment gains and losses are recognized in net income based upon the specific identification method ^{p. 67}.

G.    Derivatives

• The Company uses commodity derivatives to assume risk and manage exposures in the insurance industry ^{p. 68}.
• Commodity derivatives expose the Company to potentially unfavorable price changes to the underlying commodities ^{p. 68}.
• The Company accounts for its derivatives in accordance with FASB ASC Topic 815, Derivatives and Hedging ^{p. 68}.
• This accounting standard requires all derivatives to be recorded at fair value on the Company’s balance sheet as either assets or liabilities ^{p. 68}.
• Changes in fair value of derivatives are reflected in current earnings ^{p. 68}.
• The Company meets the criteria to net assets and liabilities related to derivatives ^{p. 68}.
• These netted assets and liabilities are included in "other assets" on the Consolidated Balance Sheets ^{p. 68}.
• The Company considers its exchange-traded futures and forward purchase and sale contracts to be effective economic hedges ^{p. 68}.
• The Company has not elected hedge accounting treatment for these derivatives ^{p. 68}.
• The fair value of derivatives is estimated by reference to quoted prices or broker quotes, or through industry or internal valuation models when quotes are unavailable ^{p. 68}.
• Further details and required disclosures regarding derivatives can be found in Note 8 ^{p. 68}.

H.    Reinsurance

• The Company purchases prospective reinsurance for certain lines of business on a proportional, excess of loss, and facultative basis ^{p. 69}.
• Proportional reinsurance requires the Company to share losses and expenses with the reinsurer in exchange for a share of premiums ^{p. 69}.
• Excess of loss reinsurance shares losses, either proportionally or entirely, above a certain dollar threshold, for a negotiated cost ^{p. 69}.
• Facultative reinsurance covers specific risks and/or policies on either a proportional or excess of loss basis ^{p. 69}.
• Ceded unearned premium and reinsurance balances recoverable (on paid and unpaid losses and settlement expenses) are reported separately as assets ^{p. 69}.
• Reinsurance does not relieve the Company of its legal liability to policyholders ^{p. 69}.
• Reinsurance on unpaid losses and settlement expenses represents estimates of the portion of liabilities recoverable from reinsurers ^{p. 69}.
• On the Consolidated Statements of Operations, net earned premiums, losses and loss adjustment expenses, net, and underwriting, acquisition, and insurance expenses are presented net of reinsurance ceded ^{p. 69}.
• The Company has purchased retroactive reinsurance on certain lines of business in prior years, including loss portfolio transfers ("LPT") and adverse development covers ^{p. 69}.
• These retroactive contracts indemnify losses related to past loss events, with the reinsurer sharing losses based on dollar thresholds ^{p. 69}.
• Income from retroactive reinsurance contracts is deferred and amortized into net income over the settlement period ^{p. 69}.
• Losses from retroactive reinsurance contracts are charged to net income immediately ^{p. 69}.
• Subsequent changes in the measurement of retroactive reinsurance contracts are accounted for using a full retrospective method ^{p. 69}.
• Certain ceded reinsurance contracts that management determines do not transfer significant insurance risk are accounted for using the deposit method ^{p. 69}.
• The evaluation of significant insurance risk transfer assesses both timing risk and underwriting risk ^{p. 69}.
• A reinsurance contract may not transfer significant insurance risk if either underwriting risk, timing risk, or both are not deemed transferred ^{p. 69}.
• For contracts transferring only significant timing risk but not sufficient underwriting risk, a deposit asset is recorded equal to the initial cash outflow ^{p. 69}.
• This deposit asset is offset by cash inflows received from reinsurers ^{p. 69}.
• If cash outflows are expected to differ from cash inflows, an accretion rate is established at inception based on actuarial estimates ^{p. 69}.
• The deposit accounting asset is increased/decreased to the estimated amount receivable over the contract term ^{p. 69}.
• The accretion of the deposit is based on the expected rate of return implied from estimated cash inflows and outflows ^{p. 69}.
• The Company periodically reassesses the estimated ultimate receivable and the related expected rate of return on the deposit asset ^{p. 69}.
• The accretion of the deposit asset, including changes from estimated cash flow changes, is reflected as part of investment income ^{p. 69}.
• Several reinsurance contracts require deposit accounting due to not transferring sufficient underwriting risk ^{p. 69}.
• No reinsurance contracts required deposit accounting due to not transferring sufficient timing risk ^{p. 69}.
• Reinsurance recoverables are carried net of an allowance for credit losses, which represents the current estimate of expected credit losses ^{p. 69}.
• The Company develops a historical loss rate using the A.M. Best impairment rate and rating transition study, which provides historical loss data for similarly rated reinsurance companies based on expected receivable duration ^{p. 69}.
• The historical loss rate is adjusted for current conditions, reasonable and supportable forecasts, and current economic conditions ^{p. 69}.
• Changes in the allowance for credit losses are recognized in underwriting, acquisition, and insurance expenses on the Consolidated Statements of Operations ^{p. 69}.
• The Company continuously monitors the financial condition of its reinsurers, including reviewing their annual financial statements and industry developments ^{p. 69}.
• The Company analyzes credit risk by monitoring reinsurers' financial strength ratings from A.M. Best and assessing collateral adequacy ^{p. 69}.
• The Company has access to collateral from various reinsurers if they fail to fulfill obligations ^{p. 69}.
• Reinsurance collateral from reinsurers was $344.1 million as of December 31, 2025, and $337.0 million as of December 31, 2024 ^{p. 69}.
• eMaxx Captives and Everest Reinsurance Co. represented 17.7% and 11.1%, respectively, of the Company’s reinsurance recoverable balances at December 31, 2025 ^{p. 69}.
• eMaxx Captives and Everest Reinsurance Co. represented 16.8% and 18.0%, respectively, of the Company’s reinsurance recoverable balances at December 31, 2024 ^{p. 69}.
• These were the only reinsurers representing 10% or more of the Company’s reinsurance recoverable balances ^{p. 69}.
• eMaxx Captives was not rated by A.M. Best at December 31, 2025, and 2024 ^{p. 69}.
• Everest Reinsurance Co.'s financial strength rating from A.M. Best was A+ at December 31, 2025, and 2024 ^{p. 69}.

I.     Concentration of Credit Risk

• Financial instruments that could lead to concentrations of credit risk include cash and cash equivalents, restricted cash, investments, and premiums receivable, excluding reinsurance recoverables ^{p. 70}.
• Cash equivalents and short-term investments consist of U.S. government securities and money market funds ^{p. 70}.
• Investments are diversified across various industries and geographic regions ^{p. 70}.
• The Company limits its credit exposure to any single financial institution or issuer ^{p. 70}.
• No significant concentration of credit risk is believed to exist regarding cash and investments ^{p. 70}.
• As of December 31, 2025 and 2024, outstanding premiums receivable are generally diversified due to a large customer base spread across many lines of business and geographic regions ^{p. 70}.
• Failure by distribution sources to remit premiums could lead to premium write-offs and a corresponding loss of income ^{p. 70}.

J.     Deferred Policy Acquisition Costs

• Policy acquisition costs include commissions and premium taxes that are directly related to new or renewal business production ^{p. 71}.
• The Company defers policy acquisition costs and related ceding commissions ^{p. 71}.
• Deferred costs are charged or credited to earnings proportionally with the premium earned over the policy's life ^{p. 71}.
• A premium deficiency is recognized if expected losses, loss adjustment expenses, and unamortized acquisition costs exceed related unearned premiums ^{p. 71}.
• To recognize a premium deficiency, unamortized acquisition costs are first charged to expense to eliminate the deficiency ^{p. 71}.
• If the premium deficiency exceeds unamortized acquisition costs, a liability is accrued for the excess ^{p. 71}.
• Anticipated investment income is considered when determining premium deficiencies ^{p. 71}.
• Management determined that no premium deficiency existed as of December 31, 2025, and 2024 ^{p. 71}.

K.    Goodwill and Intangible Assets

• Goodwill and intangible assets are recorded following a business combination ^{p. 72}.
• Goodwill is the excess of the purchase price over the fair value of acquired assets and assumed liabilities ^{p. 72}.
• The Company reviews its purchase price allocation for up to one year post-acquisition, allowing for adjustments within this period ^{p. 72}.
• The Company amortizes identifiable intangible assets with a finite useful life over the period they are expected to contribute to future cash flows ^{p. 72}.
• The Company does not amortize indefinite-lived intangible assets ^{p. 72}.
• The Company reviews goodwill and identifiable intangible assets for recoverability annually in the fourth quarter or on an interim basis if circumstances suggest the carrying amount may not be recoverable ^{p. 72}.
• The Company had no goodwill impairment for the years ended December 31, 2025, and 2024 ^{p. 72}.

L.    Property and Equipment

• Property and equipment is included in other assets on the Consolidated Balance Sheets ^{p. 73}.
• Property and equipment is recorded at cost less accumulated depreciation ^{p. 73}.
• Depreciation expense is recognized on a straight-line basis for financial statement purposes ^{p. 73}.
• Depreciation periods range from three to seven years ^{p. 73}.

M.     Reserves for Losses and Loss Adjustment Expenses

• Reserves for unpaid losses and loss adjustment expenses (LAE) represent the Company's estimated ultimate cost of all unreported and reported but unpaid insured claims and the cost to adjust losses incurred as of the balance sheet date ^{p. 74}.
• The Company estimates reserves using individual case-basis valuations of reported claims, statistical analyses, and various actuarial procedures ^{p. 74}.
• Estimates are based on historical information, industry and peer group information, and estimates of future trends in variable factors such as loss severity, loss frequency, and inflation ^{p. 74}.
• The Company regularly reviews and adjusts estimates as experience develops or new information becomes known ^{p. 74}.
• During the loss settlement period, estimates of liability on a claim are often refined and adjusted upward or downward ^{p. 74}.
• The ultimate liability may exceed or be less than the revised estimates, and the ultimate settlement of losses and related LAE may vary significantly from the estimate in the financial statements ^{p. 74}.
• If actual liabilities exceed recorded amounts, there will be an adverse effect ^{p. 74}.
• If recorded reserves are determined to be more than adequate, it would lead to a reduction in reserves ^{p. 74}.

N.    Premiums

• The Company recognizes property and casualty and surety premiums on a pro-rata basis over the policy terms ^{p. 75}.
• Accident and health premiums are earned as billed, based on census data ^{p. 75}.
• Gross premiums written are reduced by ceded premiums from proportional, facultative, and excess of loss reinsurance costs for prospective reinsurance ^{p. 75}.
• Premiums receivable include deferred premiums, which are installment payments due from insureds under policy payment terms ^{p. 75}.
• Premiums receivable are carried net of an allowance for credit losses ^{p. 75}.
• The allowance for credit losses represents the current estimate of expected credit losses ^{p. 75}.
• The Company develops a historical loss rate using historical write-offs and aging of receivables ^{p. 75}.
• This historical loss rate is adjusted for current conditions, reasonable and supportable forecasts, and the ability to cancel coverage after a premium is past due ^{p. 75}.
• Changes in the allowance for credit losses are recognized in underwriting, acquisition, and insurance expenses on the Consolidated Statements of Operations ^{p. 75}.
• Unearned premiums represent the portion of gross premiums written applicable to the unexpired terms of in-force insurance policies or reinsurance contracts ^{p. 75}.
• Ceded unearned premiums represent the portion of ceded premiums written applicable to the unexpired terms of in-force insurance policies or reinsurance contracts ^{p. 75}.
• Unearned premiums (direct and ceded) are calculated on a pro-rata basis over the terms of the policies ^{p. 75}.

O.     Commission and Fee Income

• SUA commission revenue is generated from placing insurance policies on reinsurance programs via a reinsurance broker ^{p. 76}.
• The Company's single performance obligation for SUA commission revenue is the placement of insurance policies ^{p. 76}.
• The transaction price for SUA commission revenue is fixed at contract inception and based on a percentage of premiums placed ^{p. 76}.
• The Company recognizes 100% of the transaction price for SUA commission revenue when the policy is placed, as there are no constraints on revenue ^{p. 76}.
• SUA fee income is generated from placing insurance policies with a third-party insurance company ^{p. 76}.
• The Company's single performance obligation for SUA fee income is the placement of the policy ^{p. 76}.
• The transaction price for SUA fee income is variable at contract inception and based on a percentage of premium, which is determined by risk factors that change monthly (e.g., employee census data, worker roles) ^{p. 76}.
• The Company estimates the transaction price for SUA fee income over the policy's life using the expected value method ^{p. 76}.
• Revenue from SUA fee income is recognized when the policy is placed ^{p. 76}.
• Changes in the estimate of variable consideration for SUA fee income are recognized in the month they occur ^{p. 76}.

P.     Income Taxes

• Income tax expense is accrued for the tax effects of transactions reported on the consolidated financial statements ^{p. 77}.
• Provision for income taxes consists of taxes currently due plus deferred taxes resulting from temporary differences between financial statement and income tax purposes ^{p. 77}.
• A valuation allowance is established for any deferred tax asset not expected to be realized ^{p. 77}.
• Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years temporary differences are expected to be recovered or settled ^{p. 77}.
• The effect on deferred tax assets and liabilities from a change in tax rates is recognized in income in the period that includes the enactment date ^{p. 77}.
• A liability for uncertain tax positions is recorded when it is more likely-than-not that the tax position will not be sustained upon examination by the appropriate tax authority ^{p. 77}.
• Changes in the liability for uncertain tax positions are reflected in income tax expense in the period when a new uncertain tax position arises, judgment changes about the likelihood of an uncertainty, the tax issue is settled, or the statute of limitation expires ^{p. 77}.
• Any potential net interest income or expense and penalties related to uncertain tax positions are recorded on the Consolidated Statements of Operations ^{p. 77}.
• The Company files a consolidated federal income tax return in the United States and certain other state tax returns ^{p. 77}.
• Its admitted insurance subsidiaries pay premium taxes on gross written premiums in lieu of most state income or franchise taxes ^{p. 77}.
• Premium tax expense is recognized within underwriting, acquisition, and insurance expense on the Consolidated Statements of Operations ^{p. 77}.

Q.     Fair Value of Financial Instruments

• Fair value for each class of financial instrument is estimated based on the framework established in fair value accounting guidance ^{p. 78}.
• The guidance requires maximizing the use of observable inputs and minimizing unobservable inputs when measuring fair value ^{p. 78}.
• Fair value hierarchy disclosures are based on the quality of inputs used to measure fair value ^{p. 78}.
• The hierarchy prioritizes unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) ^{p. 78}.
• The hierarchy gives the lowest priority to unobservable inputs (Level 3 measurements) ^{p. 78}.
• The Company uses widely recognized, third-party pricing sources to determine fair values of financial instruments ^{p. 78}.
• The Company understands the valuation methodologies and inputs of these third-party pricing sources ^{p. 78}.
• Further details regarding fair value disclosures are in Note 4 ^{p. 78}.

R.     Stock-Based Compensation

• The estimated fair value of employee stock options and similar awards is expensed ^{p. 79}.
• Compensation cost for equity instrument awards to employees is measured based on the grant-date fair value of those awards ^{p. 79}.
• Compensation expense is recognized over the service period during which the awards are expected to vest ^{p. 79}.
• Tax effects related to share-based payments are made through net earnings ^{p. 79}.
• Further discussion and related disclosures regarding stock-based compensation are in note 18 ^{p. 79}.
• The Company's Employee Stock Purchase Plan (ESPP) allows all employees to purchase common stock at a discount ^{p. 79}.
• Compensation cost for the ESPP is recognized on a straight-line basis over the offering period ^{p. 79}.

S.    Earnings Per Share

• Basic earnings per share is calculated using the two-class method ^{p. 80}.
• Undistributed earnings are allocated to participating securities based on their share in earnings as if all earnings for the period were distributed ^{p. 80}.
• Basic earnings per share is calculated by dividing net income attributable to common stockholders by the weighted-average number of common shares outstanding for the period ^{p. 80}.
• Common shares with unsatisfied contingencies, such as vesting requirements, are excluded from basic earnings per share ^{p. 80}.
• The Company’s preferred shares are participating securities, sharing in dividends and distributions with common stock on an as-converted basis ^{p. 80}.
• Instruments awarded to employees that grant the right to purchase common stock at a fixed price are included as potential common shares, weighted for the portion of the period they were granted, if dilutive ^{p. 80}.
• The Company’s common and preferred shares financed by stock notes are contingently issuable instruments, excluded from basic and diluted earnings per share if specified conditions are not met, presuming the end of the period is the end of the contingency period ^{p. 80}.
• The impact of contingently issuable instruments on diluted earnings per share was calculated using the treasury stock method and included in the reconciliation of the denominator for the year ended December 31, 2024 ^{p. 80}.
• All outstanding stock notes were settled during 2024, resulting in no impact on the Company’s basic and diluted earnings per share computations for the year ended December 31, 2024 ^{p. 80}.
• Instruments convertible into common shares are included in diluted weighted-average common shares outstanding on an if-converted basis, based on the legal conversion rate for the respective period, if dilutive ^{p. 80}.
• Share-based awards to employees with only service conditions are included as potential common shares, weighted for the unvested portion of the period, if dilutive ^{p. 80}.
• Share-based awards to employees with performance and service or market conditions are included as potential common shares, presuming the end of the period is the end of the contingency period, if dilutive ^{p. 80}.
• When common share adjustments increase earnings per share or reduce loss per share, the effect is anti-dilutive, and diluted net earnings or net loss per share is computed excluding these common share equivalents ^{p. 80}.

T.    Recent Accounting Pronouncements

• ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740) was issued by FASB in December 2023 ^{p. 81}.
• ASU 2023-09 mandates enhanced rate reconciliation disclosures for public companies annually, including specific categories and additional information meeting a quantitative threshold ^{p. 81}.
• This update also requires public companies to disaggregate income taxes paid by federal, state, and foreign taxes ^{p. 81}.
• The guidance became effective for fiscal years beginning after December 15, 2024, and is applied prospectively ^{p. 81}.
• The Company has added additional disclosures as required by ASU 2023-09, with no impact on the consolidated financial statements ^{p. 81}.
• Additional disclosures required by ASU 2023-09 can be found in Note 13 ^{p. 81}.
• ASU 2024-03 was issued by FASB in November 2024, requiring disaggregated disclosure of income statement expenses for public business entities ("PBEs") ^{p. 81}.
• ASU 2024-03 does not change expense captions on the income statement but requires disaggregation of certain expense captions into specified categories in footnotes ^{p. 81}.
• The ASU requires a footnote disclosure about specific expenses, mandating PBEs to disaggregate, in a tabular presentation, relevant income statement expense captions that include natural expenses such as: (1) purchases of inventory, (2) employee compensation, (3) depreciation, (4) intangible asset amortization, and (5) depreciation, depletion, and amortization recognized as part of oil- and gas-producing activities or other types of depletion expenses ^{p. 81}.
• The tabular disclosure will also include certain other expenses, where applicable ^{p. 81}.
• ASU 2025-01 was issued by FASB in January 2025 to clarify the effective date of ASU 2024-03 ^{p. 81}.
• The effective date for ASU 2024-03 is the first annual reporting period beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027 ^{p. 81}.
• The Company is evaluating the effect of these amendments on its consolidated financial statements ^{p. 81}.

2. Goodwill and Intangible Assets

• The Company's indefinite-lived intangible assets relate to insurance licenses and trademarks ^{p. 82}.
• The Company's finite-lived intangible assets relate to policy renewals, agency relationships (within agent relationships), and non-compete/exclusivity agreements (within non-competes) ^{p. 82}.
• Finite-lived intangible assets had a weighted average useful life of approximately 12 years as of December 31, 2025 ^{p. 82}.
• The Company recognized amortization expense of approximately USD 1.3m for the year ended December 31, 2025 ^{p. 82}.
• The Company recognized amortization expense of approximately USD 1.1m for the year ended December 31, 2024 ^{p. 82}.
• The Company recognized amortization expense of approximately USD 1.5m for the year ended December 31, 2023 ^{p. 82}.

2. Goodwill and Intangible Assets

($ in thousands)	Accident and Health	Surety	Construction and Energy Solutions	Other	Total
Goodwill	—	—	—	—	—
Gross balance at December 31, 2024	91,577	6,781	10,204	3,879	112,441
Accumulated impairment at December 31, 2024	( 44,821 )	—	—	( 1,886 )	( 46,707 )
Net balance at December 31, 2025	46,756	6,781	10,204	1,993	65,734

2. Goodwill and Intangible Assets

($ in thousands)	Accident and Health	Surety	Construction and Energy Solutions	Other	Total
Goodwill	—	—	—	—	—
Gross balance at December 31, 2023	91,577	6,781	10,204	3,879	112,441
Accumulated impairment at December 31, 2023	( 44,821 )	—	—	( 1,886 )	( 46,707 )
Net balance at December 31, 2024	46,756	6,781	10,204	1,993	65,734

2. Goodwill and Intangible Assets

($ in thousands)	Agent Relationships	Non-competes	Trademarks	Licenses	Total
Other Intangible Assets	—	—	—	—	—
Gross balance at December 31, 2024	24,491	1,117	999	14,019	40,626
Accumulated amortization at December 31, 2024	( 17,895 )	( 1,117 )	—	—	( 19,012 )
Additions	2,000	—	—	—	2,000
Amortization	( 1,308 )	—	—	—	( 1,308 )
Net balance at December 31, 2025	7,288	—	999	14,019	22,306

2. Goodwill and Intangible Assets

($ in thousands)	Agent Relationships	Non-competes	Trademarks	Licenses	Total
Other Intangible Assets	—	—	—	—	—
Gross balance at December 31, 2023	24,491	1,117	999	14,019	40,626
Accumulated amortization at December 31, 2023	( 16,808 )	( 1,117 )	—	—	( 17,925 )
Amortization	( 1,087 )	—	—	—	( 1,087 )
Net balance at December 31, 2024	6,596	—	999	14,019	21,614

2. Goodwill and Intangible Assets

($ in thousands)
Years Ending December 31,	Amount
2026	1,053
2027	1,053
2028	1,053
2029	762
2030	553

3. Investments

• Fixed maturity securities, held-to-maturity at December 31, 2025, consisted entirely of asset-backed securities not due at a single maturity date ^{p. 83}.
• At December 31, 2025, the Company had U.S. government agencies mortgage-backed fixed maturity securities with a carrying value of approximately $68.5 million pledged as collateral for a loan (the "FHLB Loan") from the Federal Home Loan Bank of Dallas ("FHLB") ^{p. 83}.
• The Company retains all rights regarding the pledged securities under the terms of the FHLB Loan and the Advances and Security Agreement ^{p. 83}.
• At December 31, 2025, the Company had assets with fair values of approximately $69.5 million pledged as collateral for performance obligations under reinsurance agreements ^{p. 83}.
• The pledged assets for reinsurance agreements included residential mortgage-backed securities of $57.8 million, cash and cash equivalents and other assets of $9.5 million, and short-term investments of $2.2 million ^{p. 83}.
• The Company retains all rights regarding these pledged securities under the terms of the trust agreements ^{p. 83}.
• The Company monitors available-for-sale fixed maturity securities for impairment, requiring significant management judgment ^{p. 83}.
• Factors considered for fixed maturity securities impairment include the issuer's financial condition, receipt of scheduled principal and interest cash flows, and intent to sell before recovery ^{p. 83}.
• As of December 31, 2025, the Company had 450 lots of fixed maturity securities in an unrealized loss position ^{p. 83}.
• The Company does not intend to sell these securities and is not likely to be required to sell them before maturity or recovery of cost basis ^{p. 83}.
• At December 31, 2025, the Company identified credit impairments for two available-for-sale securities in the "corporate securities and miscellaneous" category, based on new recovery analysis showing deteriorating conditions ^{p. 83}.
• For U.S. government securities and municipal securities, the decline in fair values was due to changes in interest rates, not credit quality ^{p. 83}.
• The Company does not intend to sell these U.S. government and municipal securities and expects recovery, thus not considering them impaired ^{p. 83}.
• For corporate securities and miscellaneous, the decline in fair values was due to changes in interest rates, not credit quality ^{p. 83}.
• The Company reviewed corporate security issuers for adverse changes in financial condition, credit enhancement quality, ratings decreases, or payment failures, and determined declines were interest rate-driven ^{p. 83}.
• The Company does not intend to sell these corporate securities and expects recovery, thus not considering them impaired ^{p. 83}.
• For residential mortgage-backed securities, commercial mortgage-backed securities, and other asset-backed securities, the decline in fair values was due to changes in interest rates, not credit quality ^{p. 83}.
• The Company does not intend to sell these mortgage-backed and asset-backed securities and expects recovery, thus not considering them impaired ^{p. 83}.
• Various state regulations require the Company to maintain cash, investment securities, or letters of credit on deposit with states ^{p. 83}.
• At December 31, 2025, cash and investment securities on deposit had carrying values of approximately $70.0 million ^{p. 83}.
• At December 31, 2024, cash and investment securities on deposit had carrying values of approximately $66.8 million ^{p. 83}.

3. Investments

($ in thousands)	Amortized Cost	Gross Unrealized Gains	Gross Unrealized Losses	Allowance for Credit Losses	Fair Value
December 31, 2025
Fixed maturity securities, available-for-sale:	—	—	—	—	—
U.S. government securities	44,190	292	( 14 )	—	44,468
Corporate securities and miscellaneous	632,244	14,223	( 3,080 )	( 7,000 )	636,387
Municipal securities	102,691	1,725	( 2,300 )	—	102,116
Residential mortgage-backed securities	487,145	8,928	( 9,486 )	—	486,587
Commercial mortgage-backed securities	72,631	1,016	( 597 )	—	73,050
Other asset-backed securities	509,854	5,194	( 1,353 )	—	513,695
Total fixed maturity securities, available-for-sale	1,848,755	31,378	( 16,830 )	( 7,000 )	1,856,303
Other asset-backed securities	33,290	829	( 48 )	( 468 )	33,603
Total fixed maturity securities, held-to-maturity	33,290	829	( 48 )	( 468 )	33,603

3. Investments

($ in thousands)	Amortized Cost	Gross Unrealized Gains	Gross Unrealized Loss	Allowance for Credit Losses	Fair Value
December 31, 2024
Fixed maturity securities, available-for-sale:	—	—	—	—	—
U.S. government securities	26,577	35	( 126 )	—	26,486
Corporate securities and miscellaneous	433,298	5,618	( 13,288 )	—	425,628
Municipal securities	89,966	116	( 5,366 )	—	84,716
Residential mortgage-backed securities	408,585	1,875	( 16,627 )	—	393,833
Commercial mortgage-backed securities	70,262	545	( 1,443 )	—	69,364
Other asset-backed securities	291,578	2,447	( 1,834 )	—	292,191
Total fixed maturity securities, available-for-sale	1,320,266	10,636	( 38,684 )	—	1,292,218
Other asset-backed securities	39,396	—	( 436 )	( 243 )	38,717
Total fixed maturity securities, held-to-maturity	39,396	—	( 436 )	( 243 )	38,717

3. Investments

($ in thousands)	Amortized Cost	Fair Value
Due in less than one year	45,682	45,478
Due after one year through five years	449,790	449,145
Due after five years through ten years	219,293	224,696
Due after ten years	64,360	63,652
Mortgage-backed securities	559,776	559,637
Other asset-backed securities	509,854	513,695
Total	1,848,755	1,856,303

3. Investments

	Less than 12 Months		12 Months or More		Total
($ in thousands)	Fair Value	Gross Unrealized Losses	Fair Value	Gross Unrealized Losses	Fair Value	Gross Unrealized Losses
December 31, 2025
Fixed maturity securities, available-for-sale:	—	—	—	—	—	—
U.S. government securities	349	( 1 )	1,565	( 13 )	1,914	( 14 )
Corporate securities and miscellaneous	67,644	( 346 )	63,575	( 2,734 )	131,219	( 3,080 )
Municipal securities	19,157	( 400 )	22,004	( 1,900 )	41,161	( 2,300 )
Residential mortgage-backed securities	56,147	( 262 )	74,075	( 9,224 )	130,222	( 9,486 )
Commercial mortgage-backed securities	4,646	( 3 )	8,363	( 594 )	13,009	( 597 )
Other asset-backed securities	85,098	( 424 )	16,081	( 929 )	101,179	( 1,353 )
Total fixed maturity securities, available-for-sale	233,041	( 1,436 )	185,663	( 15,394 )	418,704	( 16,830 )
Other asset-backed securities	1,912	( 48 )	—	—	1,912	( 48 )
Total fixed maturity securities, held-to-maturity:	1,912	( 48 )	—	—	1,912	( 48 )
Total	234,953	( 1,484 )	185,663	( 15,394 )	420,616	( 16,878 )

3. Investments

	Less than 12 Months		12 Months or More		Total
($ in thousands)	Fair Value	Gross Unrealized Losses	Fair Value	Gross Unrealized Losses	Fair Value	Gross Unrealized Losses
December 31, 2024
Fixed maturity securities, available-for-sale:	—	—	—	—	—	—
U.S. government securities	15,938	( 34 )	2,297	( 92 )	18,235	( 126 )
Corporate securities and miscellaneous	136,888	( 2,060 )	81,232	( 11,228 )	218,120	( 13,288 )
Municipal securities	41,930	( 1,046 )	27,687	( 4,320 )	69,617	( 5,366 )
Residential mortgage-backed securities	201,407	( 3,366 )	82,496	( 13,261 )	283,903	( 16,627 )
Commercial mortgage-backed securities	9,411	( 126 )	13,178	( 1,317 )	22,589	( 1,443 )
Other asset-backed securities	75,119	( 721 )	29,851	( 1,113 )	104,970	( 1,834 )
Total fixed maturity securities, available-for-sale	480,693	( 7,353 )	236,741	( 31,331 )	717,434	( 38,684 )
Other asset-backed securities	2,144	( 2 )	36,573	( 434 )	38,717	( 436 )
Total fixed maturity securities, held-to-maturity:	2,144	( 2 )	36,573	( 434 )	38,717	( 436 )
Total	482,837	( 7,355 )	273,314	( 31,765 )	756,151	( 39,120 )

3. Investments

($ in thousands)	Fixed Maturity Securities, Available-For-Sale	Fixed Maturity Securities, Held-to-Maturity
Balance at December 31, 2024	—	243
Current period provision for credit losses	7,000	257
Recoveries of amounts previously written off	—	( 32 )
Balance at December 31, 2025	7,000	468

3. Investments

—	Fixed Maturity Securities, Held-to-Maturity
Balance at December 31, 2023	329
Current period provision for credit losses	18
Recoveries of amounts previously written off	( 104 )
Balance at December 31, 2024	243

3. Investments

($ in thousands)	2025	2024	2023
Gross realized gains	—	—	—
Fixed maturity securities, available-for-sale	3,002	2,662	1,042
Equity securities	34,262	8,062	6,035
Other	685	213	2
Total	37,949	10,937	7,079
Fixed maturity securities, available-for-sale	( 10,832 )	( 8,161 )	( 1,879 )
Equity securities	( 3,000 )	( 4,132 )	( 5,256 )
Other	( 413 )	( 223 )	( 20 )
Total	( 14,245 )	( 12,516 )	( 7,155 )
Equity securities	( 22,908 )	7,500	11,516
Mortgage loans	( 7 )	421	( 386 )
Other	21,360	—	—
Net investment gains	22,149	6,342	11,054

3. Investments

($ in thousands)	2025	2024	2023
Fixed maturity securities, available-for-sale	198,195	217,468	26,626
Equity securities	126,738	37,534	40,201

3. Investments

($ in thousands)	2025	2024	2023
Income (loss):	—	—	—
Fixed maturity securities, available-for-sale	80,302	57,574	34,703
Fixed maturity securities, held-to-maturity	( 804 )	4,091	4,181
Equity securities	1,223	2,720	3,418
Equity method investments	( 2,683 )	2,524	( 9,434 )
Mortgage loans	1,622	5,153	5,474
Indirect loans	( 8,129 )	( 2,400 )	( 4,155 )
Short-term investments and cash	12,828	14,851	11,392
Other	3,307	3,000	318
Total investment income	87,666	87,513	45,897
Investment expenses	( 4,047 )	( 6,913 )	( 5,557 )
Net investment income	83,619	80,600	40,340

3. Investments

($ in thousands)	2025	2024	2023
Fixed maturity securities	42,594	1,046	25,952
Deferred income taxes	( 9,017 )	( 213 )	( 5,420 )
Total	33,577	833	20,532

4. Fair Value Measurements

• The Company's financial instruments include assets and liabilities carried at fair value, and those carried at cost or amortized cost but disclosed at fair value ^{p. 84}.
• The market approach is generally used to determine fair value, based on prices and data from market transactions of identical or comparable assets and liabilities ^{p. 84}.
• Fair value of investments is determined using data primarily from third-party investment managers or pricing vendors ^{p. 84}.
• Periodic analyses are conducted on third-party prices to ensure they are reasonable estimates of fair value, including reviewing month-to-month fluctuations and comparing valuations from different pricing services for identical securities ^{p. 84}.
• Financial instruments are classified into a three-level hierarchy ^{p. 84}.
• Level 1 inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date ^{p. 84}.
• Level 2 inputs are observable inputs other than Level 1 quoted prices, corroborated with market data at the measurement date ^{p. 84}.
• Level 3 inputs are unobservable inputs reflecting management's best estimate of what market participants would use in pricing the asset or liability at the measurement date ^{p. 84}.
• U.S. government securities, mutual funds, and common stock use unadjusted quoted prices for identical instruments in an active exchange, representing Level 1 inputs ^{p. 84}.
• Preferred stocks, municipal securities, corporate securities, and miscellaneous use a pricing model with market-based inputs like trades in illiquid markets for specific securities or active markets for similar securities, considering benchmark yields, issuer spreads, security terms, and other market data, representing Level 2 fair value inputs ^{p. 84}.
• Commercial mortgage-backed securities, residential mortgage-backed securities, and other asset-backed securities use a pricing model with market-based inputs such as dealer quotes, market spreads, and yield curves, evaluating individual tranches by determining cash flows using security terms, collateral performance, credit information, benchmark yields, and estimated prepayments, representing Level 2 fair value inputs ^{p. 84}.
• Fixed maturity securities, available for sale classified as Level 3, include corporate securities and other asset-backed securities managed by an independent asset manager and priced by an independent pricing provider ^{p. 84}.
• The provider estimates the value of these Level 3 securities using the discounted net present value of cash flows method with an unobservable discount rate ^{p. 84}.
• The discount rate spread for Level 3 fixed maturity securities represents the risk associated with future cash flows, including inflation, opportunity cost, and time value of money ^{p. 84}.
• Mortgage loans have variable interest rates and are collateralized by real property ^{p. 84}.
• Fair value of mortgage loans is determined using the income approach with observable and unobservable (Level 3) inputs ^{p. 84}.
• The unobservable input for mortgage loans is the spread applied to a prime rate for discounting cash flows, representing the incremental cost of capital based on borrower's ability to pay and collateral value relative to loan balance, subject to judgment and uncertainty ^{p. 84}.
• Derivatives, consisting of exchange-traded options contracts, are included in other assets ^{p. 84}.
• The fair values of these options are measured using quoted prices in active markets on the relevant exchange, specifically the volume-weighted average price of trades in similar contracts or the last trade settlement price, representing Level 1 inputs ^{p. 84}.
• Certain assets, including investments in indirect loans and loan collateral, equity method investments, and other invested assets, are measured at fair value on a nonrecurring basis only when impaired ^{p. 84}.
• The Company discloses fair values of other financial instruments where practicable to estimate, using quoted market prices or other valuation methodologies ^{p. 84}.
• Fixed maturity securities, held-to-maturity, consisting of senior and junior notes with target rates of return, had their fair value determined using the income approach with unobservable (Level 3) inputs as of December 31, 2025 ^{p. 84}.
• Investment in RedBird Capital Partners, a limited partnership investing in Bishop Street Underwriters, LLC (MGA), had a fair value of USD 55.6m at December 31, 2025, and USD 28.2m at December 31, 2024, determined using net asset value ^{p. 84}.
• Procedures to assess the reasonableness of this investment's fair value include obtaining and reviewing audited financial statements ^{p. 84}.
• The unfunded commitment related to the RedBird Capital Partners investment was USD 18.3m at December 31, 2025, and USD 24.4m at December 31, 2024 ^{p. 84}.
• The Company may sell its interest in this investment with prior written notice and approval by the general partner ^{p. 84}.
• This investment is measured at fair value using the net asset value per share practical expedient and is not classified in the fair value hierarchy, in accordance with Accounting Standard Codification 820-10 ^{p. 84}.
• Net earned premiums related to this agreement were USD 41.5m for the year ended December 31, 2025, and USD 2.5m for the year ended December 31, 2024 ^{p. 84}.
• The carrying value of notes payable approximates their estimated fair value because they accrue interest at current market rates plus a spread ^{p. 84}.
• Fair value for notes payable is determined using the income approach with observable (Level 2) inputs ^{p. 84}.
• Subordinated debt, consisting of Unsecured Subordinated Notes due May 24, 2039, has a fixed interest rate ^{p. 84}.
• The fair value of subordinated debt is determined using the income approach with observable (Level 2) inputs ^{p. 84}.
• Other financial instruments that qualify as insurance-related products are exempt from fair value disclosure requirements ^{p. 84}.

4. Fair Value Measurements

—	2025	2024
High	11.10%	8.00%
Low	4.25%	5.70%
Weighted average	6.40%	6.60%

4. Fair Value Measurements

—	2025	2024
High	8.34%	10.00%
Low	6.55%	7.00%
Weighted average	7.74%	7.93%

4. Fair Value Measurements

December 31, 2025
($ in thousands)	Level 1	Level 2	Level 3	Total
Fixed maturity securities, available-for-sale:	—	—	—	—
U.S. government securities	44,468	—	—	44,468
Corporate securities and miscellaneous	—	503,274	133,113	636,387
Municipal securities	—	102,116	—	102,116
Residential mortgage-backed securities	—	486,587	—	486,587
Commercial mortgage-backed securities	—	73,050	—	73,050
Other asset-backed securities	—	495,891	17,804	513,695
Total fixed maturity securities, available-for-sale	44,468	1,660,918	150,917	1,856,303
Other asset-backed securities	—	—	33,603	33,603
Total fixed maturity securities, held-to-maturity	—	—	33,603	33,603
Preferred stocks	—	1,174	—	1,174
Total equity securities	—	1,174	—	1,174
Mortgage loans	—	—	9,902	9,902
Short-term investments	264,299	—	—	264,299
Derivatives	34,857	—	—	34,857
Total	343,624	1,662,092	194,422	2,200,138

4. Fair Value Measurements

December 31, 2024
($ in thousands)	Level 1	Level 2	Level 3	Total
Fixed maturity securities, available-for-sale:	—	—	—	—
U.S. government securities	26,486	—	—	26,486
Corporate securities and miscellaneous	—	354,815	70,813	425,628
Municipal securities	—	84,716	—	84,716
Residential mortgage-backed securities	—	393,833	—	393,833
Commercial mortgage-backed securities	—	69,364	—	69,364
Other asset-backed securities	—	285,084	7,107	292,191
Total fixed maturity securities, available-for-sale	26,486	1,187,812	77,920	1,292,218
Other asset-backed securities	—	—	38,717	38,717
Total fixed maturity securities, held-to-maturity:	—	—	38,717	38,717
Common stocks	64,251	—	—	64,251
Preferred stocks	—	1,164	—	1,164
Mutual funds	40,839	—	—	40,839
Total equity securities	105,090	1,164	—	106,254
Mortgage loans	—	—	26,490	26,490
Short-term investments	274,929	—	—	274,929
Total	406,505	1,188,976	143,127	1,738,608

4. Fair Value Measurements

($ in thousands)	Fixed Maturity Securities, Available-For-Sale	Mortgage Loans
Balance at December 31, 2024	77,920	26,490
Total gains (losses) for the period recognized in net investment gains (losses)	( 5,180 )	( 7 )
Issuances	—	151
Settlements	—	( 16,732 )
Transfers into Level 3	6,143	—
Purchases	70,730	—
Sales/Disposals	( 1,493 )	—
Total unrealized gains for the period recognized in accumulated comprehensive income (loss)	2,797	—
Balance at December 31, 2025	150,917	9,902
Total losses for the period recognized in net investment gains attributable to the change in unrealized gains or losses relating to assets held as of period end	—	( 201 )

4. Fair Value Measurements

($ in thousands)	Fixed Maturity Securities, Available-For-Sale	Mortgage Loans
Balance at December 31, 2023	—	50,070
Total gains (losses) for the period recognized in net investment gains (losses)	( 195 )	420
Issuances	—	649
Settlements	—	( 24,649 )
Purchases	77,979	—
Sales/Disposals	( 374 )	—
Total unrealized gains for the period recognized in accumulated comprehensive income (loss)	510	—
Balance at December 31, 2024	77,920	26,490
Total gains for the period recognized in net investment gains (losses) attributable to the change in unrealized gains or losses relating to assets held as of period end	—	411

4. Fair Value Measurements

	2025		2024
($ in thousands)	Carrying Value	Fair Value	Carrying Value	Fair Value
Notes payable	—	—	—	—
FHLB Loan	57,000	57,458	57,000	56,200
Revolving Credit Facility	114,500	114,500	43,000	43,000
Term Loan Facility	300,000	300,000	—	—
Notes payable	471,500	471,958	100,000	99,200
Unsecured subordinated notes	19,569	21,020	19,536	20,541
Subordinated debt, net of debt issuance costs	19,569	21,020	19,536	20,541

5. Mortgage Loans

• The Company invests in Separately Managed Accounts (SMA1 and SMA2) ^{p. 85}.
• As of December 31, 2025 and 2024, the Company held direct investments in mortgage loans from various creditors through SMA1 and SMA2 ^{p. 85}.
• The Company’s mortgage loan portfolios are primarily senior loans on real estate across the U.S. ^{p. 85}.
• Loans earn interest at a fixed spread above a prime rate ^{p. 85}.
• Loan maturity is approximately 2 to 4 years from loan origination ^{p. 85}.
• Principal amounts of loans are approximately 64% of the property’s appraised value at the time of loan origination ^{p. 85}.
• Uncollectible amounts on loans are determined based on consultations with the specialized investment manager, consideration of adverse situations affecting borrower repayment ability, estimated value of underlying collateral, and other relevant factors ^{p. 85}.
• The Company writes off uncollectible amounts in the period they are determined to be uncollectible ^{p. 85}.
• There were no write-offs for uncollectible amounts during the years ended December 31, 2025 and 2024 ^{p. 85}.
• As of December 31, 2025 and 2024, no mortgage loans were in the process of foreclosure ^{p. 85}.
• As of December 31, 2025 and 2024, no mortgage loans were not producing income for the previous 12 months ^{p. 85}.

5. Mortgage Loans

($ in thousands)	2025	2024
Commercial	3,334	8,474
Retail	—	10,032
Hospitality	6,568	7,984
—	9,902	26,490

5. Mortgage Loans

($ in thousands)	2025	2024	2023
Commercial	432	2,025	2,340
Retail	304	1,853	1,853
Hospitality	886	1,277	1,034
Office	—	—	203
Multi-family	—	—	44
—	1,622	5,155	5,474

6. Equity Method Investments and Other

• The difference between an investment's cost and its proportionate share of underlying equity in net assets is allocated to the equity method investment's assets and liabilities ^{p. 86}.
• The Company amortizes this difference in net assets over the useful life of a similar asset as the underlying equity method investment ^{p. 86}.
• For the investment in RISCOM, the similar asset is agent relationships ^{p. 86}.
• The Company amortizes this difference for RISCOM over a 15-year useful life ^{p. 86}.
• As of December 31, 2025 and 2024, the Company held indirect investments in collateralized loans and loan collateral through SMA1 and SMA2 ^{p. 86}.

6. Equity Method Investments and Other

($ in thousands)	2025		2024
—	Carrying Value	Ownership %	Carrying Value	Ownership %
Arena Special Opportunities Fund, LP units	26,936	14.0%	34,936	15.3%
Arena SOP LP units	—	11.2%	1,474	10.9%
Brewer Lane Ventures Fund II LP units	2,251	2.4%	1,040	2.4%
Dowling Capital Partners LP units	590	5.0%	666	5.0%
Hudson Ventures Fund 2 LP units	5,503	2.5%	4,967	2.5%
JVM Funds LLC units	14,911	10.1%	17,229	10.1%
RISCOM	3,307	20.0%	5,013	20.0%
—	53,498	—	65,325	—

6. Equity Method Investments and Other

($ in thousands)	2025	2024	2023
Arena SOP LP units	( 1,474 )	( 989 )	( 6,271 )
Arena Special Opportunities Fund, LP units	( 3,163 )	2,375	( 2,880 )
Brewer Lane Ventures Fund II LP	91	( 110 )	( 78 )
Dowling Capital Partners LP units	431	1,463	927
Hudson Ventures Fund II LP units	480	( 153 )	170
JVM Funds LLC	( 541 )	( 1,554 )	( 1,198 )
RISCOM	1,493	1,492	884
Universa Black Swan LP units	—	—	( 988 )
—	( 2,683 )	2,524	( 9,434 )

6. Equity Method Investments and Other

($ in thousands)	2025	2024
Brewer Lane Ventures Fund II LP units	3,237	4,077
Dowling Capital Partners LP units	386	386
Hudson Ventures Fund 2 LP units	166	397
Red Bird Capital Partners LP units	18,305	24,400
—	22,094	29,260

6. Equity Method Investments and Other

($ in thousands)	2025	2024
Investment in RISCOM:	—	—
Underlying equity	2,292	3,756
Difference	1,015	1,258
Recorded investment balance	3,307	5,013

6. Equity Method Investments and Other

($ in thousands)	2025	2024
Investment in JVM Funds LLC:	—	—
Underlying equity	14,457	16,624
Difference	454	605
Recorded investment balance	14,911	17,229

6. Equity Method Investments and Other

($ in thousands)	2025	2024
SMA1	15,418	20,296
SMA2	8,449	12,973
Investment in indirect loans and loan collateral	23,867	33,269

7. Variable Interest Entity

• Skyward consolidates Separate Account HSIC-01 ("HSIC-01"), established by Mangrove Risk Solutions Bermuda Ltd. ("Mangrove"), pursuant to GAAP consolidation guidance ^{p. 87}.
• HSIC-01 is a VIE for which the Company is the primary beneficiary ^{p. 87}.
• The purpose of the VIE is to hedge price volatility risks of certain insurance products by investing in dairy and livestock commodities ^{p. 87}.
• The Company considers itself the primary beneficiary because it directly manages the business ^{p. 87}.
• The Company does not provide performance guarantees and has no other financial obligation to provide funding to HSIC-01, other than its own capital commitments ^{p. 87}.
• The assets of consolidated variable interest entities may only be used to settle obligations of these entities ^{p. 87}.
• There is no recourse to the assets of HSIC-01 other than to satisfy associated liabilities ^{p. 87}.
• The table presents the assets of HSIC-01 included in the Consolidated Balance Sheets as of December 31, 2025 ^{p. 87}.
• The presented assets only include third-party net assets and exclude intercompany balances, which were eliminated upon consolidation ^{p. 87}.

7. Variable Interest Entity

($ in thousands)	2025
Assets	—
Cash and cash equivalents	15,816
Other assets	34,856
Total assets	50,672

8 . Derivatives

• The Company uses derivatives for financial risk management to mitigate price risk in insurance contracts exposed to commodity price fluctuations, specifically cattle and milk ^{p. 88}.
• A hedging strategy using derivatives, including put options and futures, is employed to mitigate revenue volatility and support financial stability ^{p. 88}.
• The primary objective of derivative instruments is to manage exposure to adverse price movements ^{p. 88}.
• The activity in these instruments reflects current market conditions and shifts in risk exposures throughout the year ^{p. 88}.
• The notional value of derivative contracts and the degree of hedged exposure are actively managed and can vary based on pricing in cattle, hogs, and milk markets ^{p. 88}.
• The Company does not use derivatives for speculative or trading purposes ^{p. 88}.
• All derivative positions support the overall risk transfer objectives of the business ^{p. 88}.
• The Company has not elected hedge accounting for these derivatives ^{p. 88}.
• The net gain (loss) recognized on derivative instruments in economic hedging relationships is presented in "losses and loss adjustment expenses" on the Consolidated Statements of Operations ^{p. 88}.
• For the year ended December 31, 2025, the Company recognized pre-tax net gains of USD 7.9m in losses and loss adjustment expenses ^{p. 88}.

8 . Derivatives

($ in thousands)	Derivative Assets
—	Notional Amount	Fair Value
Economic hedges	136,800	34,857

9. Allowance for Credit Losses

• The Company analyzes the credit risk of its reinsurance recoverables by monitoring the financial strength rating of its reinsurers from A.M. Best ^{p. 89}.
• A.M. Best is a widely recognized rating agency focused exclusively on the insurance industry ^{p. 89}.
• The Company assesses the financial strength rating annually and throughout the year as A.M. Best provides updates ^{p. 89}.
• The Company assesses the adequacy of credit enhancements such as reinsurance payables, letters of credit, and funds held ^{p. 89}.
• Reinsurance balances are considered past due when they are 90 days past due ^{p. 89}.
• On January 31, 2025, the Company commuted the LPT with R&Q Re (Bermuda) Ltd. ("R&Q") for accident years 2018 and prior ^{p. 89}.
• During the year ended December 31, 2024, the Company recognized an uncollectible reinsurance recoverable balance related to the LPT as a net increase of $13.6 million to the allowance for estimated uncollectible reinsurance ^{p. 89}.
• This $13.6 million increase was subsequently written-off ^{p. 89}.

9. Allowance for Credit Losses

($ in thousands)	Premiums Receivable, Net	Allowance for Estimated Uncollectible Premiums
Balance at December 31, 2024	321,641	2,432
Current period change for estimated uncollectible premiums	—	2,351
Write-offs of uncollectible premiums receivable	—	( 2,141 )
Recoveries of amounts previously written off	—	498
Balance at December 31, 2025	544,217	3,140

9. Allowance for Credit Losses

($ in thousands)	Premiums Receivable, Net	Allowance for Estimated Uncollectible Premiums
Balance at December 31, 2023	179,235	964
Current period change for estimated uncollectible premiums	—	3,235
Write-offs of uncollectible premiums receivable	—	( 1,895 )
Recoveries of amounts previously written off	—	128
Balance at December 31, 2024	321,641	2,432

9. Allowance for Credit Losses

	2025
A.M. Best Rating	Reinsurance Recoverables, Gross, Amortized Cost	Percent of Total
A- and above	652,178	98.2%
B++ to B+	5,077	0.8
B to B -	28	—
Not rated	6,919	1.0

9. Allowance for Credit Losses

($ in thousands)	Reinsurance Recoverables, Net	Allowance for Estimated Uncollectible Reinsurance
Balance at December 31, 2024	857,876	2,295
Balance at December 31, 2025	1,119,880	2,295

9. Allowance for Credit Losses

($ in thousands)	Reinsurance Recoverables, Net	Allowance for Estimated Uncollectible Reinsurance
Balance at December 31, 2023	596,334	2,295
Current period change for estimated uncollectible reinsurance	—	13,585
Write-offs of uncollectible reinsurance recoverables	—	( 13,585 )
Balance at December 31, 2024	857,876	2,295

10. Property and Equipment

• Depreciation expense for property and equipment was USD 3.3m for the year ended December 31, 2025 ^{p. 90}.
• Depreciation expense for property and equipment was USD 2.9m for the year ended December 31, 2024 ^{p. 90}.
• Depreciation expense for property and equipment was USD 3.2m for the year ended December 31, 2023 ^{p. 90}.
• Depreciation expense is presented in underwriting, acquisition, and insurance expenses on the Consolidated Statements of Operations ^{p. 90}.

10. Property and Equipment

(in thousands)	2025	2024
Leasehold improvements	3,434	3,056
Equipment	4,750	4,506
Software	39,263	33,972
—	47,447	41,534
Accumulated depreciation	( 32,307 )	( 29,355 )
Total	15,140	12,179

11. Notes Payable & Subordinated Debt

• On August 30, 2024, the Company entered into the FHLB Loan under the Advances and Security Agreement ^{p. 91}.
• The FHLB Loan is a 4.5-year term loan with a principal amount of USD 57.0m ^{p. 91}.
• The FHLB Loan requires interest-only payments during its term, with principal due at maturity ^{p. 91}.
• The FHLB Loan has a fixed interest rate of 4.00% over its term ^{p. 91}.
• The FHLB Loan is fully secured by a pledge of specific investment securities of HSIC ^{p. 91}.
• Proceeds from the FHLB Loan were used to fund redemptions of draws on the 2023 Revolving Credit Facility ^{p. 91}.
• During the fourth quarter of 2025, the Company entered into a Term Loan Credit Agreement (Term Loan Facility) with a syndicate of banks ^{p. 91}.
• The Term Loan Facility includes an unsecured senior delayed draw term loan facility (DDTL) of USD 150.0m (Tranche A DDTL) ^{p. 91}.
• The Term Loan Facility also includes an additional unsecured senior DDTL of USD 150.0m (Tranche B DDTL) ^{p. 91}.
• The Term Loan Facility was used to fund a portion of the consideration for the Company's acquisition of Apollo Group Holdings Limited (Apollo) and related transaction fees and expenses ^{p. 91}.
• Amounts drawn under the Term Loan Facility bear interest at either term SOFR plus a margin ranging from 150 bps to 190 bps, or the base rate plus a margin ranging from 50 bps to 90 bps, depending on the Company’s debt to capitalization ratio ^{p. 91}.
• SOFR is calculated using a SOFR floor of 0.00% and a credit spread adjustment of 0.10% ^{p. 91}.
• The base rate is the highest of (i) the Agent’s then-current prime lending rate, (ii) the Federal Funds Rate plus 0.50%, (iii) SOFR plus 1.00%, and (iv) zero percent (0%) ^{p. 91}.
• The Company pays a fee ranging from 0.20% to 0.35% on average daily undrawn amounts under the Term Loan Facility, depending on the Company’s debt to capitalization ratio ^{p. 91}.
• The Tranche A DDTL matures on January 1, 2028 ^{p. 91}.
• The Tranche B DDTL matures on July 2, 2029 ^{p. 91}.
• On December 30, 2025, the Company drew USD 150.0m from the Tranche A DDTL and USD 150.0m from the Tranche B DDTL for the acquisition of Apollo on January 1, 2026 ^{p. 91}.
• The Term Loan Facility includes customary covenants, such as limitations on additional indebtedness exceeding USD 10.0m and on distributions to stockholders, stock redemptions, repurchases, or retirements upon certain events ^{p. 91}.
• Financial covenants for the Term Loan Facility include minimum consolidated net worth, maximum total debt to capitalization, minimum A.M. Best rating, and minimum liquidity ^{p. 91}.
• As of December 31, 2025, the Company was in compliance with all Term Loan Facility covenants ^{p. 91}.
• The Term Loan Facility is unsecured ^{p. 91}.
• The Company's obligations under the Term Loan Facility are guaranteed by the Company and its existing wholly-owned subsidiaries, and subsequently acquired or organized subsidiaries, excluding insurance company subsidiaries and subject to certain exceptions ^{p. 91}.
• During the fourth quarter of 2025, the Company entered into a Revolving Credit Facility with a syndicate of banks ^{p. 91}.
• The Revolving Credit Facility is unsecured and initially provided a maximum principal amount of USD 150.0m ^{p. 91}.
• The Revolving Credit Facility maximum principal amount was increased to USD 250.0m on the closing date of the Apollo acquisition ^{p. 91}.
• The Company initially drew USD 43.0m from the Revolving Credit Facility to redeem its prior revolving credit facility ^{p. 91}.
• On December 30, 2025, the Company drew an additional USD 71.5m from the Revolving Credit Facility for the consideration paid for the acquisition of Apollo ^{p. 91}.
• Proceeds from the Term Loan Facility and the Revolving Credit Facility draws are presented net with liabilities on the Consolidated Balance Sheets for the year ended December 31, 2025 ^{p. 91}.
• These proceeds were used for the Apollo acquisition on January 1, 2026 ^{p. 91}.
• Interest on the Revolving Credit Facility is payable quarterly ^{p. 91}.
• Amounts drawn under the Revolving Credit Facility bear interest at either term SOFR plus a margin ranging from 150 bps to 190 bps, or the base rate plus a margin ranging from 50 bps to 90 bps, depending on the Company’s debt to capitalization ratio ^{p. 91}.
• SOFR for the Revolving Credit Facility is calculated using a SOFR floor of 0.00% and a credit spread adjustment of 0.10% ^{p. 91}.
• The base rate for the Revolving Credit Facility is the highest of (i) the Agent’s then current prime lending rate, (ii) the Federal Funds Rate plus 0.50%, (iii) SOFR plus 1.00%, and (iv) zero percent (0%) ^{p. 91}.
• The Company pays a fee ranging from 0.20% to 0.35% on average daily undrawn amounts under the Revolving Credit Facility, depending on the Company’s debt to capitalization ratio ^{p. 91}.
• The availability period under the Revolving Credit Facility terminates on November 12, 2030 ^{p. 91}.
• The Company is subject to covenants on the Revolving Credit Facility based on minimum net worth, maximum debt to capital ratio, minimum A.M. Best Rating, and minimum liquidity ^{p. 91}.
• As of December 31, 2025, the Company was in compliance with all Revolving Credit Facility covenants ^{p. 91}.
• During the first quarter of 2023, the Company entered into an agreement for an unsecured 2023 Revolving Credit Facility with a syndicate of banks ^{p. 91}.
• The 2023 Revolving Credit Facility provided up to USD 150.0m in revolving credit and a letter of credit sub-facility of up to USD 30.0m ^{p. 91}.
• On November 13, 2025, the Company redeemed the 2023 Revolving Credit Facility ^{p. 91}.
• The Company paid USD 0.3m of accrued interest and recognized USD 0.6m of expense for remaining unamortized deferred financing costs upon redemption of the 2023 Revolving Credit Facility ^{p. 91}.
• In May 2019, the Company agreed to issue unsecured subordinated notes (the Notes) with an aggregate principal amount of USD 20.0m ^{p. 91}.
• Interest on the Notes is fixed at 7.25% for the first 8 years and 8.25% thereafter ^{p. 91}.
• Early retirement of the Notes before the 8-year commitment requires all interest payments to be paid in full, plus the return of outstanding principal ^{p. 91}.
• Principal for the Notes is due at maturity on May 24, 2039, and interest is payable quarterly ^{p. 91}.
• The Notes have junior priority to all previously issued debt ^{p. 91}.
• The Company reports debt related to the Notes in its December 31, 2025 and 2024 Consolidated Balance Sheets, net of debt issuance costs of approximately USD 0.4m and USD 0.5m, respectively ^{p. 91}.
• These deferred financing costs are presented as a direct deduction from the carrying amount of the subordinated debt ^{p. 91}.

12. Segment

• The Company operates with one reportable segment, offering commercial property and casualty products and solutions primarily in the United States on both non-admitted (E&S) and admitted bases ^{p. 92}.
• The segment consists of nine distinct underwriting divisions, referred to as "continuing business," each with dedicated underwriting leadership and technical staff ^{p. 92}.
• The segment definition is based on how internally reported financial information is reviewed by the Chief Operating Decision Maker (CODM) for performance analysis, decision-making, and resource allocation ^{p. 92}.
• The Company's CODM is the chief executive officer ^{p. 92}.
• The accounting policies for the segment align with those described in Note 1 "Summary of Significant Accounting Policies" of the Form 10-K ^{p. 92}.
• The CODM evaluates segment performance and allocates resources using gross written premiums by net underwriting division, underwriting income, and income before income taxes (which is also reported on the Consolidated Statements of Operations as consolidated income before income taxes) ^{p. 92}.
• The measure of segment assets is reported on the Consolidated Balance Sheets as total consolidated assets ^{p. 92}.
• Gross written premiums by underwriting division, net underwriting income, and consolidated net income are used to monitor budget versus actual results ^{p. 92}.
• The CODM also uses net underwriting income, annualized return on equity, and growth in book value per share for competitive analysis by benchmarking against competitors ^{p. 92}.
• This competitive analysis and the monitoring of budgeted versus actual results are used to assess segment performance and determine management's compensation ^{p. 92}.

12. Segment

($ in thousands)	2025	2024	2023
Accident & Health	254,102	173,073	151,701
Agriculture and Credit (Re)insurance	346,212	118,070	30,598
Captives	275,694	241,902	167,624
Construction & Energy Solutions	274,318	296,582	299,748
Global Property	178,128	201,796	242,593
Professional Lines	149,231	159,785	154,565
Specialty Programs	322,705	218,407	178,726
Surety	168,148	143,965	106,056
Transactional E&S	197,779	189,669	128,236
Total continuing business	2,166,317	1,743,249	1,459,847
Exited business	( 81 )	( 17 )	( 18 )
Total gross written premiums	2,166,236	1,743,232	1,459,829

12. Segment

($ in thousands)	2025	2024	2023
Underwriting income
Revenues:	—	—	—
Net earned premiums	1,304,505	1,056,722	829,143
Commission and fee income	6,855	6,703	6,064
Total underwriting revenues	1,311,360	1,063,425	835,207
Losses and LAE	795,022	669,809	515,237
Amortization of policy acquisition costs	195,422	149,975	108,514
Other operating and general expenses	181,937	161,782	134,930
Total underwriting expenses	1,172,381	981,566	758,681
Net underwriting income	138,979	81,859	76,526
Reconciliation of net underwriting income to net income:	—	—	—
Net underwriting income	138,979	81,859	76,526
Net investment income	83,619	80,600	40,340
Net investment gains	22,149	6,342	11,054
Other loss	( 587 )	( 167 )	( 632 )
Transaction costs	14,019	—	—
Interest expense	7,919	9,496	10,024
Amortization expense	1,636	2,007	1,798
Other expenses	4,162	4,392	5,364
Income before income taxes	216,424	152,739	110,102
Income tax expense	46,396	33,911	24,118
Net income	170,028	118,828	85,984

12. Segment

—	2025	2024	2023
Return on equity	18.9%	16.3%	15.9%
Book value per share	24.92	19.79	16.72

13. Income Taxes

• The Company paid federal income taxes of USD 37.0m in 2024 and USD 15.8m in 2023 ^{p. 93}.
• The Company has federal net operating loss carryforwards of approximately USD 40.3m ^{p. 93}.
• These net operating losses are set to expire beginning in 2032 ^{p. 93}.
• Internal Revenue Code Section 382 limits the utilization of USD 40.3m of net operating losses due to an ownership change in 2014 ^{p. 93}.
• The 382 limitation is expected to result in an expiration of USD 2.8m (USD 0.6m tax effected) of net operating losses ^{p. 93}.
• A valuation allowance was established in 2025 against the balance expected to expire without utilization ^{p. 93}.
• Of the total federal NOL of USD 40.3m, USD 0.3m (USD 0.1m tax effected) is related to dual consolidated loss that Skyward is not expected to utilize ^{p. 93}.
• The Company also has net operating losses in various state and local jurisdictions totaling USD 0.9m ^{p. 93}.
• These state and local net operating losses are set to expire between 5 and 20 years or carryforward indefinitely, depending on the jurisdiction ^{p. 93}.
• The Company expects to fully utilize these state and local net operating losses ^{p. 93}.
• The Company’s federal income tax returns for tax years 2022-2024 are subject to examination by the Internal Revenue Service ^{p. 93}.
• As of December 31, 2025, the Company had no provision for uncertain tax positions and no provision for penalties or interest ^{p. 93}.
• Management does not believe there are any uncertain tax benefits that could be recognized within the next twelve months that would impact the Company’s effective tax rate ^{p. 93}.

13. Income Taxes

($ in thousands)	2025
Income from continuing operations before income tax expense	—
United States	208,763
Foreign	7,661
Total	216,424
Current tax expense	—
United States	51,758
U.S. state and local	1,107
Deferred tax benefit related to:	—
United States	( 5,584 )
U.S. state and local	( 885 )
Total income tax expense	46,396

13. Income Taxes

($ in thousands)	2024	2023
Current income tax expense	42,626	14,736
Deferred tax (benefit) expense related to temporary differences	( 8,715 )	9,382
Total income tax expense	33,911	24,118

13. Income Taxes (1)(footnote: The following state(s) and/or local jurisdictions make up more than 50% of the state income taxes: Florida.)

	2025
($ in thousands)	Amount	Percentage
U.S. federal statutory income tax rate	45,449	21.0%
State income taxes, net of federal benefit (1)	( 508 )	( 0.3 )%
Foreign tax effects	—	—
Bermuda statutory rate differential	( 1,609 )	( 0.7 )%
Effects of other cross-border tax laws	717	0.3%
Change of Valuation Allowance	68	—%
Nondeductible and Nontaxable items	—	—
Nondeductible transaction costs	1,689	0.8%
Other nondeductible and nontaxable items	590	0.3%
Effective tax rate	46,396	21.4%

13. Income Taxes

	2024		2023
($ in thousands)	Amount	Percentage	Amount	Percentage
Income tax expense at federal statutory rate	32,075	21.0%	23,121	21.0%
Tax advantaged investments	( 239 )	( 0.2 )	( 295 )	( 0.3 )
Other	2,075	1.4	1,292	1.2
Total income tax expense	33,911	22.2%	24,118	21.9%

13. Income Taxes (1)(footnote: No single state or jurisdiction accounts for greater than 5% of total taxes paid.)

($ in thousands)	2025
United States	49,830
U.S. state and local (1)	1,164
Total income taxes paid	50,994

13. Income Taxes

($ in thousands)	2025	2024
Deferred tax assets:	—	—
Net operating losses	9,409	9,389
Losses and loss adjustment expenses	21,401	16,967
Unearned premiums	22,775	18,178
Unrealized losses on fixed maturity securities, available-for-sale	—	5,893
Stock options/awards	2,446	2,453
Other	8,933	6,067
Total deferred tax assets before valuation allowance	64,964	58,947
Valuation allowance	( 654 )	( 586 )
Total deferred tax assets	64,310	58,361
Deferred policy acquisition costs	19,132	15,277
Other long-term investments	2,888	2,625
Section 481(a) adjustment	87	1,391
Unrealized gains on equity securities	7	4,818
Unrealized gains on fixed maturity securities, available-for-sale	3,101	—
Unrealized gains on other investments	5,465	—
Depreciation	2,152	1,426
Other	3,613	2,338
Total deferred tax liabilities	36,445	27,875
Net deferred tax asset	27,865	30,486

13. Income Taxes

($ in thousands)	2025	2024
Balance at beginning of the period	586	586
Increase related to net operating loss	68	—
Balance at the end of the period	654	586

Tax Legislative Update

• The One Big Beautiful Bill Act ("OBBB Act"), which includes a broad range of tax reform provisions, was signed into law in the United States on July 4, 2025 ^{p. 94}.
• The OBBB Act did not have a material impact on the Company's annual effective tax rate in 2025 ^{p. 94}.
• No material impact from the OBBB Act is expected in 2026 ^{p. 94}.

14. Reserves for Losses and Loss Adjustment Expenses

• The Company evaluates net ultimate loss and LAE under three sub-categories: multi-line solutions, short-tail/monoline specialty lines, and exited lines ^{p. 95}.
• These disaggregated groupings have homogeneous risk characteristics, similar development patterns, and are subject to similar trends ^{p. 95}.
• Short-tail/monoline specialty lines include global property & agriculture, accident & health, surety, and professional lines underwriting divisions ^{p. 95}.
• These lines generally have shorter durations for losses to fully develop, with claims typically reported, settled, and paid within a relatively short timeframe ^{p. 95}.
• Short-tail/monoline specialty lines can be impacted by larger, more complex losses due to factors like difficulty in determining actual damages and legal/regulatory impediments ^{p. 95}.
• Multi-line solutions include industry solutions, programs, captives, and transactional E&S underwriting divisions ^{p. 95}.
• This subcategory predominantly consists of occurrence liability, including general liability, excess liability, and commercial auto ^{p. 95}.
• Multi-line solutions have a longer duration for losses to fully develop compared to short-tail/monoline specialty lines ^{p. 95}.
• The unique claim characteristics and longer-tail nature of multi-line solutions introduce more uncertainty, as claims can be impacted by changes in regulation, inflation, and other unforeseen factors over time ^{p. 95}.
• Exited lines include all underwriting units placed in run-off and are presented separately from ongoing lines of business ^{p. 95}.
• For the year ended December 31, 2025, the Company recognized favorable development related to prior years’ loss and loss expense reserves of USD 7.5m ^{p. 95}.
  • This was driven by favorable development of USD 24.6m in short-tail/monoline specialty lines and USD 5.3m in multi-line solutions ^{p. 95}.
  • This was partially offset by USD 22.4m of adverse development in exited lines ^{p. 95}.
  • The adverse development in exited lines was primarily attributable to commercial auto and excess over auto in divisions that have been non-renewed or had significantly reduced exposure over the past three years ^{p. 95}.
  • This was offset by favorable development in surety and property ^{p. 95}.
• For the year ended December 31, 2024, the Company recognized adverse development related to prior years’ loss and loss expense reserves of USD 25.7m ^{p. 95}.
  • This was primarily related to losses previously subject to the LPT from accident years 2018 and prior ^{p. 95}.
  • This included USD 10.1m in multi-line solutions and USD 15.2m in exited lines ^{p. 95}.
• During the year ended December 31, 2023, the Company recognized adverse development related to prior years’ loss and loss expense reserves of USD 10.8m ^{p. 95}.
  • Adverse development of USD 11.7m in multi-line solutions was driven by greater than expected severity in auto, general, and excess liability lines of business, primarily from accident years 2020 to 2022 ^{p. 95}.
  • This adverse development was partially offset by favorable development in short-tail/monoline specialty lines ^{p. 95}.
  • The favorable development in short-tail/monoline specialty lines was in the property line of business, primarily from accident years 2021 and 2022 ^{p. 95}.

14. Reserves for Losses and Loss Adjustment Expenses

($ in thousands)	2025	2024	2023
Reserves for losses and LAE, beginning of period	1,782,383	1,314,501	1,141,757
Less: reinsurance recoverable on unpaid claims, beginning of period	( 670,846 )	( 455,484 )	( 435,986 )
Reserves for losses and LAE, beginning of period, net of reinsurance	1,111,537	859,017	705,771
Incurred, net of reinsurance, related to:	—	—	—
Current period	810,375	657,783	505,894
Prior years	( 7,471 )	25,728	10,770
Total incurred, net of reinsurance	802,904	683,511	516,664
Paid, net of reinsurance, related to:	—	—	—
Current period	144,799	136,731	109,937
Prior years	371,913	294,260	253,481
Total paid	516,712	430,991	363,418
Net reserves for losses and LAE, end of period	1,397,729	1,111,537	859,017
Plus: reinsurance recoverable on unpaid claims, end of period	921,165	670,846	455,484
Reserves for losses and LAE, end of period	2,318,894	1,782,383	1,314,501

Short Duration Contract Disclosures

• Losses and LAE reserves represent the Company's best estimate of the ultimate net cost of all reported and unreported losses that are unpaid as of the balance sheet dates ^{p. 96}.
• The Company's estimated reserves for losses and LAE include the accumulation of estimates for claims reported and unpaid prior to the balance sheet dates ^{p. 96}.
• Estimates for losses and LAE also include projections of relevant historical data for increases in claims costs for claims already reported ^{p. 96}.
• Estimates for losses and LAE include claims incurred but not reported ^{p. 96}.
• Estimates for losses and LAE include expenses for investigating and adjusting all incurred and unpaid claims ^{p. 96}.
• The Company measures claim counts by incident when determining the cumulative number of reported claims ^{p. 96}.
• Claim counts include all claims reported, even if the Company does not establish a liability for the claim (i.e., reserve for loss and loss adjustment expenses) ^{p. 96}.

Short-tail/Monoline Specialty Lines

Short-tail/Monoline Specialty Lines

($ in thousands except number of claims)
Incurred Losses and ALAE, Net of Reinsurance						As of December 31, 2025
	Years Ended December 31,						Reported Claims
Accident Year	2021*	2022*	2023*	2024*	2025	IBNR	Reported Claims
2021	92,780	93,429	92,143	92,134	99,783	1,774	1,656
2022	—	108,299	105,394	104,095	96,874	6,266	2,414
2023	—	—	190,565	191,865	161,222	28,997	5,015
2024	—	—	—	280,147	292,220	99,302	5,819
2025	—	—	—	—	422,528	275,190	5,495
Total	—	—	—	—	1,072,627	—	—
Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	( 528,255 )	—	—
Net reserves for loss and ALAE before 2021	Net reserves for loss and ALAE before 2021	Net reserves for loss and ALAE before 2021	Net reserves for loss and ALAE before 2021	Net reserves for loss and ALAE before 2021	1,570	—	—
Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	545,942	—	—
*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited

Short-tail/Monoline Specialty Lines

($ in thousands)
Cumulative Paid Losses and ALAE, Net of Reinsurance ($ in thousands)
	Years Ended December 31,
Accident Year	2021*	2022*	2023*	2024*	2025
2021	18,447	56,803	67,912	78,439	93,560
2022	—	27,773	64,594	77,150	85,696
2023	—	—	33,795	100,705	114,247
2024	—	—	—	53,691	154,896
2025	—	—	—	—	79,856
Total	—	—	—	—	528,255
*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited

Multi-line Solutions

Multi-line Solutions

($ in thousands except number of claims)
Incurred Losses and ALAE, Net of Reinsurance ($ in thousands)											As of December 31, 2025
Accident Year	Years Ended December 31,											Reported Claims
Accident Year	2016*	2017*	2018*	2019*	2020*	2021*	2022*	2023*	2024*	2025	IBNR	Reported Claims
2016	63,223	62,843	62,843	62,643	84,579	84,579	84,829	84,829	85,434	85,098	828	4,744
2017	—	65,332	65,332	64,260	78,166	78,166	78,766	78,766	80,493	79,819	837	5,592
2018	—	—	74,476	74,476	69,319	71,719	73,019	73,019	75,686	72,963	673	5,103
2019	—	—	—	107,432	109,226	112,378	115,530	116,230	116,206	110,564	1,384	6,113
2020	—	—	—	—	113,030	124,076	128,111	132,495	132,125	134,281	4,174	5,542
2021	—	—	—	—	—	156,067	158,891	160,331	160,546	157,006	7,932	6,727
2022	—	—	—	—	—	—	236,909	242,097	242,358	249,317	19,315	8,679
2023	—	—	—	—	—	—	—	306,511	306,511	320,637	96,700	8,468
2024	—	—	—	—	—	—	—	—	353,933	336,197	155,878	7,700
2025	—	—	—	—	—	—	—	—	—	356,590	257,468	6,139
Total	—	—	—	—	—	—	—	—	—	1,902,472	—	—
Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	( 1,162,853 )	—	—
Net reserves for loss and ALAE before 2016	Net reserves for loss and ALAE before 2016	Net reserves for loss and ALAE before 2016	Net reserves for loss and ALAE before 2016	Net reserves for loss and ALAE before 2016	Net reserves for loss and ALAE before 2016	Net reserves for loss and ALAE before 2016	Net reserves for loss and ALAE before 2016	Net reserves for loss and ALAE before 2016	Net reserves for loss and ALAE before 2016	( 189 )	—	—
Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	739,430	—	—
*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited

Multi-line Solutions

($ in thousands)
Cumulative Paid Losses and ALAE, Net of Reinsurance ($ in thousands)
	Years Ended December 31,
Accident Year	2016*	2017*	2018*	2019*	2020*	2021*	2022*	2023*	2024*	2025
2016	23,239	42,528	53,352	58,895	69,691	72,544	75,855	77,160	77,760	77,825
2017	—	23,770	41,945	53,093	61,354	67,926	71,109	73,770	75,714	77,177
2018	—	—	26,201	42,568	47,226	58,655	65,635	69,893	70,128	72,429
2019	—	—	—	33,019	50,933	71,053	87,816	99,451	106,765	106,826
2020	—	—	—	—	29,499	60,680	82,236	105,283	121,097	126,965
2021	—	—	—	—	—	37,118	73,293	102,772	125,749	141,539
2022	—	—	—	—	—	—	50,148	114,794	165,854	205,410
2023	—	—	—	—	—	—	—	63,079	122,186	181,636
2024	—	—	—	—	—	—	—	—	58,281	123,488
2025	—	—	—	—	—	—	—	—	—	49,558
Total	—	—	—	—	—	—	—	—	—	1,162,853
*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited

Exited Lines — all lines in runoff

• The provided table reconciles net incurred and paid loss development tables to balance sheet reserves for losses and loss adjustment expenses as of December 31, 2025 and 2024 ^{p. 97}.
• The subsequent table details the historical average annual payout of incurred losses and allocated loss adjustment expenses (claims duration) for short-duration contracts ^{p. 97}.
• This claims duration data is based on disaggregated information from paid loss development tables, net of reinsurance ^{p. 97}.

Exited Lines — all lines in runoff

($ in thousands except number of claims)
Incurred Losses and ALAE, Net of Reinsurance ($ in thousands)											As of December 31, 2025
	Years Ended December 31,											Reported Claims
Accident Year	2016*	2017*	2018*	2019*	2020*	2021*	2022*	2023*	2024*	2025	IBNR	Reported Claims
2016	93,019	92,996	91,372	93,577	97,301	98,301	100,651	100,651	102,801	104,246	1,851	4,911
2017	—	75,159	79,581	81,785	65,735	68,346	68,646	68,646	70,885	72,682	1,819	4,370
2018	—	—	74,357	68,990	76,506	79,006	84,165	84,165	92,082	91,897	4,093	4,941
2019	—	—	—	87,115	73,635	77,770	79,414	79,572	79,823	86,131	9,773	5,660
2020	—	—	—	—	132,248	136,469	137,835	137,907	137,671	138,320	10,644	4,867
2021	—	—	—	—	—	83,322	91,188	91,323	92,095	97,577	10,676	2,446
2022	—	—	—	—	—	—	12,717	12,240	11,800	14,362	2,025	246
2023	—	—	—	—	—	—	—	—	—	2	1	1
2024	—	—	—	—	—	—	—	—	—	5	5	—
2025	—	—	—	—	—	—	—	—	—	11	11	—
Total	—	—	—	—	—	—	—	—	—	605,233	—	—
Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	Cumulative net paid loss and ALAE from the table below	( 538,304 )	—	—
Net reserves for loss and ALAE before 2015	Net reserves for loss and ALAE before 2015	Net reserves for loss and ALAE before 2015	Net reserves for loss and ALAE before 2015	Net reserves for loss and ALAE before 2015	Net reserves for loss and ALAE before 2015	Net reserves for loss and ALAE before 2015	Net reserves for loss and ALAE before 2015	Net reserves for loss and ALAE before 2015	Net reserves for loss and ALAE before 2015	14,737	—	—
Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	Total net reserves for loss and ALAE	81,666	—	—
*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited

Exited Lines — all lines in runoff

($ in thousands)
Cumulative Paid Losses and ALAE, Net of Reinsurance ($ in thousands)
	Years Ended December 31,
Accident Year	2016*	2017*	2018*	2019*	2020*	2021*	2022*	2023*	2024*	2025
2016	36,592	57,638	70,253	78,070	81,181	87,482	91,556	95,114	97,462	98,831
2017	—	34,176	52,103	51,985	50,545	57,457	62,924	66,498	68,480	69,798
2018	—	—	25,553	60,149	39,870	54,339	67,001	74,604	79,860	82,244
2019	—	—	—	28,636	28,954	30,948	45,696	57,341	65,847	70,367
2020	—	—	—	—	102,725	98,202	102,132	114,543	120,831	124,139
2021	—	—	—	—	—	41,540	57,820	66,012	72,923	81,600
2022	—	—	—	—	—	—	2,155	4,077	9,211	11,325
2023	—	—	—	—	—	—	—	—	—	—
2024	—	—	—	—	—	—	—	—	—	—
2025	—	—	—	—	—	—	—	—	—	—
Total	—	—	—	—	—	—	—	—	—	538,304
*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited

Exited Lines — all lines in runoff

($ in thousands)	2025	2024
Net reserves for losses and ALAE:	—	—
Short-tail/Monoline Specialty Lines	545,942	367,226
Multi-line Solutions	739,430	631,065
Exited Lines	81,666	86,689
Reserves for losses and ALAE, net of reinsurance	1,367,038	1,084,980
Short-tail/Monoline Specialty Lines	388,276	275,204
Multi-line Solutions	514,393	380,344
Exited Lines	18,496	15,298
Total reinsurance recoverable on unpaid claims	921,165	670,846
Unallocated LAE	30,691	26,557
Reserves for losses and LAE at end of year	2,318,894	1,782,383

Exited Lines — all lines in runoff

Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance
	Years
—	1*	2*	3*	4*	5*	6*	7*	8*	9*	10*
Short-Tail/Monoline Specialty Lines	21.1%	38.1%	10.8%	9.7%	15.2%	N/A	N/A	N/A	N/A	N/A
Multi-line Solutions	23.9%	21.6%	15.6%	13.6%	10.5%	4.8%	1.9%	2.4%	1.3%	0.1%
Exited Lines	27.5%	12.2%	4.9%	9.9%	8.9%	6.8%	4.9%	2.9%	2.0%	1.3%
*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	*Supplementary information and unaudited	—	—	—	—	—	—

15. Commission and Fee Income

• Skyward Underwriters Agency, Inc. (SUA) is a subsidiary of the Company ^{p. 98}.
• SUA acts as a managing general insurance agent and reinsurance broker ^{p. 98}.
• SUA specializes in property and casualty and accident and health risks within specialty niche markets ^{p. 98}.
• Commission and fee income is primarily generated by SUA ^{p. 98}.
• This income is derived from the placement of insurance policies with third-party insurance or reinsurance companies ^{p. 98}.

15. Commission and Fee Income

($ in thousands)	2025	2024	2023
SUA commission revenue	8,323	7,967	7,222
SUA fee revenue	2,333	2,443	2,732
Other commission and fee revenue (loss)	1,725	266	( 135 )
Total commission and fee revenue	12,381	10,676	9,819
Commission and fee expenses	( 5,526 )	( 3,973 )	( 3,755 )
Net commission and fee income	6,855	6,703	6,064

15. Commission and Fee Income

($ in thousands)	Contract Assets
Balance at December 31, 2023	976
Balance at December 31, 2024	1,416

16. Underwriting, Acquisition and Insurance Expenses

• Underwriting, acquisition and insurance expenses were USD 390.0m in 2025, USD 330.0m in 2024, and USD 270.0m in 2023 ^{p. 99}.
• Commissions and brokerage were USD 190.0m in 2025, USD 160.0m in 2024, and USD 130.0m in 2023 ^{p. 99}.
• Salaries and employee benefits were USD 110.0m in 2025, USD 90.0m in 2024, and USD 70.0m in 2023 ^{p. 99}.
• General and administrative expenses were USD 90.0m in 2025, USD 80.0m in 2024, and USD 70.0m in 2023 ^{p. 99}.

16. Underwriting, Acquisition and Insurance Expenses

($ in thousands)	2025	2024	2023
Amortization of policy acquisition costs	195,422	149,975	108,514
Other operating and general expenses	181,937	161,782	134,930
Total underwriting, acquisition and insurance expenses	377,359	311,757	243,444

17. Reinsurance

• Reinsurance agreements are used to assume and cede premiums and benefits with other insurance companies ^{p. 100}.
• Reinsurance agreements increase the Company's capacity to write larger risks and manage loss exposure within its capital resources ^{p. 100}.
• The Company remains obligated for ceded amounts if reinsurers fail to meet their obligations ^{p. 100}.
• The Company entered into agreements with several reinsurers to establish funded trust accounts where the Company is the sole beneficiary ^{p. 100}.
• These trust accounts provide additional security for collecting claim recoverables under reinsurance contracts ^{p. 100}.
• The Company does not carry these trust accounts on its balance sheet as it only gains custody upon the reinsurer's failure to pay ^{p. 100}.
• The market value of these trust accounts was approximately $233.5 million at December 31, 2025 ^{p. 100}.
• The trust amount will be periodically adjusted by mutual agreement based on claim payments and loss reserve recoverables ^{p. 100}.
• During Q1 2020, the Company entered into an LPT retroactive reinsurance agreement with R&Q ^{p. 100}.
• The reinsurance recoverable from R&Q was $22.7 million at December 31, 2024 ^{p. 100}.
• The LPT was commuted effective January 31, 2025, and the Company received the reinsurance recoverable balance in full ^{p. 100}.
• Certain ceded reinsurance contracts that transfer only significant timing risk and insufficient underwriting risk are accounted for using the deposit method ^{p. 100}.
• The Company’s deposit asset was $22.7 million at December 31, 2025, and $25.9 million at December 31, 2024 ^{p. 100}.
• The deposit asset was included in other assets on the Consolidated Balance Sheets ^{p. 100}.

17. Reinsurance

	2025		2024		2023
($ in thousands)	Written	Earned	Written	Earned	Written	Earned
Direct premiums	1,684,411	1,622,594	1,458,637	1,375,917	1,241,180	1,155,835
Assumed premiums	481,825	406,792	284,595	282,662	218,649	193,971
Ceded premiums	( 760,004 )	( 724,881 )	( 619,654 )	( 601,857 )	( 549,138 )	( 520,663 )
Net premiums	1,406,232	1,304,505	1,123,578	1,056,722	910,691	829,143
Ceded losses and LAE incurred	—	697,978	—	534,295	—	337,011

17. Reinsurance

($ in thousands)	2025	2024
Ceded unpaid losses and LAE	921,165	670,846
Ceded paid losses and LAE	201,010	166,663
Loss portfolio transfer	—	22,662
Allowance for credit losses	( 2,295 )	( 2,295 )
Reinsurance recoverables	1,119,880	857,876
Ceded unearned premium	238,948	203,901

18. Stock Based Compensation

• The 2022 Long-Term Incentive Plan (2022 Plan) was approved by the Board of Directors on September 23, 2022, and became effective on January 12, 2023 ^{p. 101}.
• The 2022 Plan replaced the Company’s prior Long Term Incentive Plan (2020 Plan) ^{p. 101}.
• The 2022 Plan allows for granting restricted stock, restricted stock units, performance stock units, stock options, and cash-based performance awards to select employees and non-employee directors ^{p. 101}.
• 3,200,656 shares of common stock were available for issuance under the 2022 Plan ^{p. 101}.
• In November 2024, the Compensation Committee approved a program for independent directors to defer settlement of annual restricted stock units (RSU) awards ^{p. 101}.
• Directors can elect to defer RSU settlement to the fifth anniversary of the grant date, the tenth anniversary of the grant date, or the date of separation of service from the Company ^{p. 101}.
• This deferral program was available for Directors who elected in 2024 to defer settlement of their 2025 RSU awards, which vest in 2026 ^{p. 101}.
• The grant date fair value of options under the 2022 Plan was determined using the Black-Scholes model, with a contractual term of 10 years less the weighted average service period ^{p. 101}.
• Volatility for option valuation was based on historical volatility of comparable publicly traded insurance companies ^{p. 101}.
• Stock options granted to employees during the year ended December 31, 2023, were valued at approximately $4.4 million based on grant date fair value ^{p. 101}.
• The aggregate intrinsic value of options outstanding was $27.4 million at December 31, 2025, and $27.0 million at December 31, 2024 ^{p. 101}.
• The weighted-average remaining contractual life of options outstanding at December 31, 2025, was 7.0 years ^{p. 101}.
• The fair value of restricted stock and restricted stock units under the 2022 Plan for awards granted at the time of the Company’s IPO was the IPO price of $15.00 per share ^{p. 101}.
• The fair value of subsequent grants of restricted stock units was equal to the closing stock price on the grant date ^{p. 101}.
• The expense for equity-based incentives is based on fair value at grant date and amortized over their vesting period ^{p. 101}.
• Restricted stock and restricted stock units granted to employees and the Board of Directors were valued at approximately $12.2 million in 2025, $8.5 million in 2024, and $17.7 million in 2023, based on grant date fair value ^{p. 101}.
• Board of Directors were granted 12,579 shares in 2025, 19,453 shares in 2024, and 23,482 shares in 2023 of restricted stock and restricted stock units, each with a one-year service period ^{p. 101}.
• The total fair value of shares vested for employees and Board of Directors was $6.0 million in 2025, $3.8 million in 2024, and $0.5 million in 2023 ^{p. 101}.
• As of December 31, 2025, the total unrecognized compensation cost related to non-vested, stock-based compensation awards was $17.4 million ^{p. 101}.
• The weighted average period over which the unrecognized compensation cost is expected to be recognized is 1.6 years ^{p. 101}.
• The Company recognized stock-based compensation expense of $12.0 million in 2025, $9.4 million in 2024, and $8.5 million in 2023 ^{p. 101}.
• The 2022 Employee Stock Purchase Plan (ESPP) was approved by the Board of Directors on September 23, 2022, and became effective on May 15, 2023 ^{p. 101}.
• The ESPP is administered by the Compensation Committee ^{p. 101}.
• Under the ESPP, employees can elect to have a percentage of their annual base earnings withheld to purchase common stock at two specified intervals each year ^{p. 101}.
• The purchase price of common stock under the ESPP is 85% of the lower of its beginning-of-interval or end-of-interval market price ^{p. 101}.
• The Company has reserved 376,548 common shares under the ESPP ^{p. 101}.
• The grant date fair value of options under the ESPP was determined using the Black-Scholes model, with a term of 6 months (between grant date and exercisable date) ^{p. 101}.
• Volatility for ESPP option valuation was based on historical volatility of comparable publicly traded insurance companies ^{p. 101}.
• As of December 31, 2025, a total of 141,845 shares had been purchased under the ESPP ^{p. 101}.
• The Company recognized ESPP expense of $0.7 million in 2025 and $0.5 million in 2024 ^{p. 101}.
• As of December 31, 2025, the fair value of unrecognized ESPP expense was $0.3 million ^{p. 101}.

18. Stock Based Compensation

	Award Payout Range	Requisite Service Period	Target Stock and Stock Units
Year ended December 31, 2025	—	—	—
Market condition awards	0 %- 150 %	3 years	22,495
Performance condition awards	0 %- 150 %	3 years	59,769
Service condition awards	N/A	1 - 4 years	144,921
—	—	—	227,185
Market condition awards	0 %- 150 %	3 years	32,058
Performance condition awards	0 %- 150 %	3 years	76,881
Service condition awards	N/A	1 - 4 years	124,025
—	—	—	232,964
Market condition awards	0 %- 150 %	3 years	37,622
Performance condition awards	0 %- 150 %	3 years	95,456
Service condition awards	N/A	1 - 4 years	968,778
Stock options	N/A	3 - 4 years	759,990
—	—	—	1,861,846

18. Stock Based Compensation

—	Weighted-Average Exercise Price	Stock
Outstanding at January 1, 2025	—	759,990
Forfeited	15.00	( 219 )
Outstanding at December 31, 2025	—	759,771

18. Stock Based Compensation

—	Stock
Outstanding at January 1, 2024	759,990
Outstanding at December 31, 2024	759,990

18. Stock Based Compensation (1)(footnote: Increases above the 100% target level are reflected as granted in the period after which performance-based stock unit goals are achieved.) (2)(footnote: Decreases below the 100% target level are reflected as forfeited.)

—	Weighted-Average Grant-Date Fair Value	Stock and Stock Units
Non-vested at January 1, 2025	19.06	1,325,483
Granted (1)	47.77	254,978
Vested	15.33	( 391,746 )
Forfeited (2)	25.74	( 53,247 )
Non-vested at December 31, 2025	27.06	1,135,468
Non-vested at January 1, 2024	15.13	1,445,449
Granted (1)	31.72	268,631
Vested	13.16	( 285,957 )
Forfeited (2)	18.27	( 102,640 )
Non-vested at December 31, 2024	19.06	1,325,483
Non-vested at January 1, 2023	12.55	419,896
Granted (1)	16.07	1,101,856
Vested	13.39	( 40,645 )
Forfeited (2)	15.29	( 35,658 )
Non-vested at December 31, 2023	15.13	1,445,449

19. Earnings Per Share

• The table sets forth the computation of basic and diluted net earnings per share for the years ended December 31, 2025, 2024, and 2023 ^{p. 102}.
• The table presents anti-dilutive instruments excluded from the calculation of diluted weighted-average common share equivalents for the years ended December 31, 2025, 2024, and 2023 ^{p. 102}.
• The table presents common share equivalents of contingently issuable instruments excluded from basic earnings per share for the years ended December 31, 2025, 2024, and 2023 ^{p. 102}.

19. Earnings Per Share

($ in thousands, except for share and per share amounts)	2025	2024	2023
Numerator	—	—	—
Net income	170,028	118,828	85,984
Less: Undistributed income allocated to participating securities	—	—	( 1,677 )
Net income attributable to common stockholders (numerator for basic earnings per share)	170,028	118,828	84,307
Add back: Undistributed income allocated to participating securities	—	—	1,677
Net income (numerator for diluted earnings per share under the two-class method)	170,028	118,828	85,984
Basic weighted-average common shares	40,407,310	40,056,475	36,031,907
Dilutive effect of preferred shares	—	—	716,708
Dilutive effect of stock notes	—	—	696,110
Dilutive effect of stock units	897,426	917,510	736,837
Dilutive effect of options	503,310	403,475	135,972
Diluted weighted-average common share equivalents	41,808,046	41,377,460	38,317,534
Basic earnings per share	4.21	2.97	2.34
Diluted earnings per share	4.07	2.87	2.24

19. Earnings Per Share

—	2025	2024	2023
Stock units	104,531	20,346	3,931
Options	242	859	914

19. Earnings Per Share

—	2025	2024	2023
Common shares	—	—	920,864
Total	—	—	920,864

20. Employee Benefit Plan

• The Company sponsors the 401(k) Plan (the “Plan”), which is available to substantially all its employees ^{p. 103}.
• The Plan is subject to provisions of the Employee Retirement Income Security Act of 1974 ^{p. 103}.
• The Company makes discretionary matching contributions to the Plan ^{p. 103}.
• Company matching contributions to the Plan were:
  • 2025: USD 3.9m ^{p. 103}
  • 2024: USD 3.2m ^{p. 103}
  • 2023: USD 2.9m ^{p. 103}

Riscom

• RISCOM provides wholesale brokerage services to the Company ^{p. 104}.
• RISCOM and the Company have a managing general agency agreement ^{p. 104}.
• The Company holds a 20% ownership interest in RISCOM ^{p. 104}.
• Premiums receivable as of December 31, 2025, were USD 13.9m ^{p. 104}.
• Premiums receivable as of December 31, 2024, were USD 12.6m ^{p. 104}.

Riscom

($ in thousands)	2025	2024	2023
Net earned premium	120,067	108,130	99,736
Commissions	28,728	25,372	24,177

Other

• Advisory and professional services fees and expense reimbursements paid to affiliated stockholders and directors were USD 0.6m for the years ended December 31, 2025 and 2024 ^{p. 105}.
• Advisory and professional services fees and expense reimbursements paid to affiliated stockholders and directors were USD 3.6m for the year ended December 31, 2023 ^{p. 105}.
• For investments involving affiliated companies and additional related party transactions, refer to Notes 5, 6, and 11 ^{p. 105}.

Litigation

• The Company is involved in various legal actions stemming from claims under insurance policies and contracts ^{p. 106}.
• These legal actions are factored into the Company's estimation of losses and loss adjustment expense reserves ^{p. 106}.
• The Company is occasionally a defendant in legal actions related to bad faith claims, disputes with third parties, or alleged errors and omissions ^{p. 106}.
• Accruals for these items are recorded when losses are probable and reasonably estimable ^{p. 106}.
• Based on current information, available insurance coverage, and advice from legal counsel, the Company believes the resolution of these matters will not individually or in aggregate have a material adverse effect on its consolidated financial position, results of operations, or cash flows ^{p. 106}.

Indemnification

• The Company has provided indemnifications to certain buyers in conjunction with the sale of business assets and subsidiaries ^{p. 107}.
• These indemnifications cover typical representations and warranties related to performance responsibilities under sales contracts ^{p. 107}.
• The potential exposure from these indemnifications is difficult to determine due to the variety of matters, operations, and scenarios covered ^{p. 107}.
• Certain indemnifications have no time limit ^{p. 107}.
• The Company currently does not believe any significant claims exist related to these indemnifications ^{p. 107}.

23. Statutory Accounting Principles and Regulatory Matters

• Statutory net income was $159.1 million for 2025, $108.2 million for 2024, and $73.1 million for 2023 ^{p. 108}.
• Statutory capital and surplus was $872.0 million as of December 31, 2025, and $710.6 million as of December 31, 2024 ^{p. 108}.
• Effective December 31, 2024, the Company restacked its insurance company subsidiaries, making GMIC the lead insurance company ^{p. 108}.
• Following the restacking, HSIC became a wholly owned subsidiary of GMIC ^{p. 108}.
• IIC became a wholly owned subsidiary of HSIC ^{p. 108}.
• OSIC became a wholly owned subsidiary of IIC ^{p. 108}.
• Dividend payments from GMIC to the Company are restricted by Texas state law, requiring regulatory approval for amounts exceeding certain limits ^{p. 108}.
• The maximum amount of dividends GMIC can pay without prior approval is subject to restrictions related to policyholder surplus, net income, and dividends declared or distributed in the preceding 12 months ^{p. 108}.
• As of December 31, 2025, GMIC, domiciled in Texas, is restricted to paying dividends that are the greater of ten percent of prior year-end capital and surplus or prior year net income ^{p. 108}.
• GMIC did not declare or pay any dividend during the year ended December 31, 2025 ^{p. 108}.
• HSIC did not declare or pay any dividends during the year ended December 31, 2024 ^{p. 108}.
• Property and casualty insurance companies are subject to Risk Based Capital (RBC) requirements specified by the National Association of Insurance Commissioners (NAIC) ^{p. 108}.
• RBC requirements dictate that the amount of capital and surplus maintained by an insurer should be based on its various risk factors ^{p. 108}.
• As of December 31, 2025, and 2024, GMIC’s statutory capital and surplus substantially exceeded the regulatory RBC requirements ^{p. 108}.

24. Subsequent Events

• On September 2, 2025, the Company entered into two share purchase agreements (the "Apollo Majority SPAs") with institutional and management shareholders (the "Majority Sellers") of Apollo Group Holdings Limited ("Apollo") ^{p. 109}.
• Pursuant to the Apollo Majority SPAs, the Company agreed to acquire all issued shares of Apollo held by the Majority Sellers, representing approximately 87% of Apollo's issued share capital ^{p. 109}.
• Closing of the transaction ("Closing") was conditioned upon the Company acquiring 100% of Apollo's issued share capital (the "Acquisition") at Closing, via additional short-form share purchase agreements with the remaining minority shareholders ^{p. 109}.
• On January 1, 2026, the Company completed the acquisition for an aggregate consideration of approximately USD 555.0 million, payable in a combination of cash and newly issued shares of the Company’s common stock ^{p. 109}.
• The acquisition closed shortly before the issuance of these consolidated financial statements, so the initial accounting under ASC 805 is not yet complete ^{p. 109}.
• The Company is obtaining and evaluating information to determine identifiable assets acquired, liabilities assumed, and any resulting goodwill or intangible assets ^{p. 109}.
• Required purchase accounting disclosures will be provided in future filings once available ^{p. 109}.
• The Company evaluated subsequent events from December 31, 2025, through the date these consolidated financial statements were issued and did not identify any additional subsequent events requiring disclosure ^{p. 109}.

Controls and Procedures

Evaluation of Disclosure Controls and Procedures

• Management, including the principal executive officer and principal financial officer, evaluated the effectiveness of disclosure controls and procedures as of the end of the period covered by this Annual Report on Form 10-K ^{p. 110}.
• Disclosure controls and procedures are defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act) ^{p. 110}.
• As of December 31, 2025, the principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective at the reasonable assurance level ^{p. 110}.
• Management acknowledges that any controls and procedures can only provide reasonable assurance of achieving their objectives, and judgment is applied in evaluating the cost-benefit relationship of controls and procedures ^{p. 110}.

Management’s Report on Internal Control over Financial Reporting

• Management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, as amended ^{p. 111}.
• Internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States of America ^{p. 111}.
• Internal control over financial reporting includes policies and procedures that pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of assets ^{p. 111}.
• Internal control over financial reporting includes policies and procedures that provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures are made only in accordance with authorizations of management and directors ^{p. 111}.
• Internal control over financial reporting includes policies and procedures that provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on the financial statements ^{p. 111}.

Remediation of Material Weakness in Internal Control Over Financial Reporting

• Material weakness in internal control over financial reporting was identified as of December 31, 2024, related to ineffective implementation of information technology general controls (ITGCs) in user access for systems supporting financial reporting processes ^{p. 112}.
• Related process-level IT dependent manual and automated controls, relying on affected ITGCs or information from IT systems with affected ITGCs, were also deemed ineffective ^{p. 112}.
• During the year ended December 31, 2025, management took actions to remediate control deficiencies ^{p. 112}.
• Remediation actions included enhancing IT compliance oversight and expanding the team with ITGC design and implementation experience ^{p. 112}.
• A training program addressing ITGCs and policies was developed, educating control owners on principles and requirements ^{p. 112}.
• Procedures were implemented to develop and maintain documentation of underlying ITGCs to promote knowledge transfer upon IT personnel and function changes ^{p. 112}.
• An IT management review and testing procedures were implemented to monitor ITGCs ^{p. 112}.
• Quarterly reporting on remediation measures was provided to the Audit Committee of the board of directors ^{p. 112}.
• Management believes the measures remediated the material weakness and concluded that internal control over financial reporting was effective at a reasonable assurance level as of December 31, 2025 ^{p. 112}.
• The assessment of effectiveness of internal control over financial reporting as of December 31, 2025, was conducted under the supervision and participation of senior management, including the Chief Executive Officer and Chief Financial Officer ^{p. 112}.
• The assessment used criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in the Internal Control — Integrated Framework (2013 Framework) ^{p. 112}.
• Based on this assessment, management concluded that internal control over financial reporting was effective as of December 31, 2025 ^{p. 112}.
• The effectiveness of internal control over financial reporting as of December 31, 2025, was audited by Ernst & Young, LLP, the Company’s independent registered public accounting firm ^{p. 112}.
• Ernst & Young, LLP's opinion is stated in their report titled “Report of Independent Registered Public Accounting Firm-Opinion on Internal Control over Financial Reporting” ^{p. 112}.

Changes in Internal Control over Financial Reporting

• No change in internal control over financial reporting was identified during the year ended December 31, 2025, in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act, except for the remediation of the material weakness identified in 2024 ^{p. 113}.
• These changes have not materially affected, nor are they reasonably likely to materially affect, the company's internal control over financial reporting ^{p. 113}.

Limitations on Effectiveness of Controls and Procedures

• Management acknowledges that disclosure controls and procedures, regardless of their design and operation, offer only reasonable assurance of achieving control objectives ^{p. 114}.
• The design of disclosure controls and procedures must consider resource constraints ^{p. 114}.
• Management must exercise judgment in assessing the benefits of potential controls and procedures against their associated costs ^{p. 114}.

Other Information

• No directors or officers adopted, terminated, or modified a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement during the quarter ended December 31, 2025 ^{p. 115}.

Directors, Executive Officers and Corporate Governance

• The information required by Item 10 of Form 10-K will be included in the 2026 Proxy Statement and is incorporated by reference ^{p. 116}.

Executive Compensation

• The information required by Item 11 of Form 10-K will be included in the 2026 Proxy Statement and is incorporated by reference ^{p. 117}.

Security Ownership of Certain Beneficial Owner and Management and Related Stockholder Matters

• The information required by Item 12 of Form 10-K will be included in the company's 2026 Proxy Statement and is incorporated by reference ^{p. 118}.

Certain Relationships and Related Transactions, and Director Independence

• Information required by Item 13 of Form 10-K will be included in the 2026 Proxy Statement and is incorporated herein by reference ^{p. 119}.

Principal Accounting Fees and Services

• Our independent registered public accounting firm is Ernst & Young LLP, Houston, Texas ^{p. 120}.
• The Auditor Firm ID is 42 ^{p. 120}.
• The information required by Item 14 of Form 10-K will be included in our 2026 Proxy Statement and is incorporated herein by reference ^{p. 120}.

Exhibits, Financial Statement Schedules.

• The consolidated financial statements of the Company are filed as part of this Form 10-K and are included in Item 8 ^{p. 121}.
• The financial statements include the Report of Independent Registered Public Accounting Firm ^{p. 121}.
• The financial statements include Consolidated Balance Sheets as of December 31, 2025 and 2024 ^{p. 121}.
• The financial statements include Consolidated Statements of Operations and Comprehensive Income (loss) for the three years in the periods ended December 31, 2025, 2024, and 2023 ^{p. 121}.
• The financial statements include Consolidated Statements of Stockholders’ Equity for the three years in the period ended December 31, 2025, 2024, and 2023 ^{p. 121}.
• The financial statements include Consolidated Statements of Cash Flows for the three years in the period ended December 31, 2025, 2024, and 2023 ^{p. 121}.
• A listing of exhibits is provided ^{p. 121}.
• Items marked with an asterisk (*) are filed herewith ^{p. 121}.
• Items marked with a plus (+) indicate a management contract or compensatory plan or arrangement ^{p. 121}.

Exhibits, Financial Statement Schedules.

Schedule Number	Schedule Description	Page
I.	Summary of Investments — Other Than in Related Parties at December 31, 2025	113
II.	Financial Information of Registrant (Parent Company) for the years ended December 31, 2025, 2024 and 2023	114
IV.	Supplementary Reinsurance Information for the years ended December 31, 2025, 2024, and 2023	118
V.	Valuation and Qualifying Accounts for the years ended December 31, 2025, 2024, and 2023	119
VI.	Supplementary Information Concerning Property — Casualty Insurance Operations for the years ended December 31, 2025, 2024, and 2023	120

Exhibits, Financial Statement Schedules.

Exhibit Number	Exhibit Description
3.1	Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Company's Current Report on Form 8-K filed with the Commission on January 18, 2023).
3.2	Amended and Restated Bylaws (incorporated by reference to Exhibit 3.2 to the Company's Current Report on Form 8-K filed with the Commission on January 18, 2023).
4.1	Amended and Restated Stockholders’ Agreement, dated March 12, 2014, by and among the Company and the stockholders listed therein (incorporated by reference to Exhibit 4.1 to the Company's Registration Statement on Form S-1, filed with the SEC on November 14, 2022).
4.2	Description of Capital Stock (incorporated by reference to Exhibit 4.2 to the Company’s Annual Report on Form 10-K, filed with the SEC on March 28, 2023).
10.1+	Share Purchase and Award Agreement and form of agreements thereunder in use before 2016 (incorporated by reference to Exhibit 10.1 to the Company's Registration Statement on Form S-1, filed with the SEC on November 14, 2022).
10.2+	2016 Equity Incentive Program and form of award agreements thereunder (incorporated by reference to Exhibit 10.2 to the Company's Registration Statement on Form S-1, filed with the SEC on November 14, 2022).
10.3+	2020 Long Term Incentive Plan and form of award agreements thereunder (incorporated by reference to Exhibit 10.3 to the Company's Registration Statement on Form S-1, filed with the SEC on November 14, 2022).
10.4+	Skyward Specialty Insurance Group, Inc. 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.4 to the Company's Registration Statement on Form S-1, filed with the SEC on November 14, 2022).
10.5+	Skyward Specialty Insurance Group, Inc. 2022 Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.5 to the Company's Registration Statement on Form S-1, filed with the SEC on November 14, 2022).
10.6+	Form of Restricted Stock Units Agreement and form of notice under the Company's 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 99.6 to the Company's Registration Statement on Form S-8, filed with the SEC on January 12, 2023).

Exhibits, Financial Statement Schedules.

Exhibit Number	Exhibit Description
10.7+	Form of Restricted Stock Agreement under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 99.7 to the Company's Registration Statement on Form S-8, filed with the SEC on January 12, 2023).
10.8+	Form of Nonstatutory Stock Option Agreement and form of notice under the Company's 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 99.8 to the Company's Registration Statement on Form S-8, filed with the SEC on January 12, 2023).
10.9+	Form of Incentive Stock Option Agreement and form of notice under the Company's 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 99.9 to the Company's Registration Statement on Form S-8, filed with the SEC on January 12, 2023).
10.10+	Form of Performance-Based Restricted Stock Units Agreement under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.10 to the Company’s Annual Report on Form 10-K, filed with the SEC on March 28, 2023).
10.11+	Performance-Based Restricted Stock Units Agreement under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.11 to the Company’s Annual Report on Form 10-K, filed with the SEC on March 28, 2023).
10.12+	Performance Unit Agreement under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.12 to the Company’s Annual Report on Form 10-K, filed with the SEC on March 28, 2023).
10.13+	Amended Form of Performance Share (GBVPS) Agreement under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.13 to the Company’s Annual Report on Form 10-K, filed with the SEC on April 1, 2024).
10.14+	Amended Form of Performance Share (Executives) Agreement under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.14 to the Company’s Annual Report on Form 10-K, filed with the SEC on April 1, 2024).
10.15+	Amended Form of Performance Share (Others) Agreement under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.15 to the Company’s Annual Report on Form 10-K, filed with the SEC on April 1, 2024).
10.16+	Amended Form of Performance Cash Units Agreement under the Company’s Long-Term Incentive Plan. (incorporated by reference to Exhibit 10.16 to the Company’s Annual Report on Form 10-K, filed with the SEC on April 1, 2024).
10.17+	Amended Form of the Restricted Stock Unit (Executives) Agreement under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.17 to the Company’s Annual Report on Form 10-K, filed with the SEC on April 1, 2024).
10.18+	Amended Form of Restricted Stock Unit (Others) Agreement under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.18 to the Company’s Annual Report on Form 10-K, filed with the SEC on April 1, 2024).
10.19+	Amended Form of Long-Term Performance Cash Plan and Award Letter under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.19 to the Company’s Annual Report on Form 10-K, filed with the SEC on April 1, 2024).
10.20+	Form of Indemnification Agreement (incorporated by reference to Exhibit 10.6 to the Company's Registration Statement on Form S-1, filed with the SEC on November 14, 2022).
10.21+	Employment Agreement, dated May 22, 2020, by and between the Registrant and Andrew Robinson, with Amendment No. 1 dated January 1, 2022 (incorporated by reference to Exhibit 10.7 to the Company's Registration Statement on Form S-1, filed with the SEC on November 14, 2022).
10.22+	Form of Non-Employee Director Deferred Restricted Stock Unit Agreement and Form of Notice Under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.22 to the Company’s Annual Report on Form 10-K, filed with the SEC on March 3, 2025).
10.23	Commutation and Release Agreement by and among R&Q Re (Bermuda) Ltd., Skyward Re, Houston Specialty Insurance Company, Imperium Insurance Company, and Great Midwest Insurance Company, dated January 31, 2025 (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed with the Commission on February 5, 2025).
10.24	Credit Agreement, dated March 29, 2023, by and among Skyward Specialty Insurance Group, Inc., the lenders from time to time party thereto and Truist Bank, as administrative agent (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed with the Commission on April 3, 2023).
10.25	First Amendment dated as of February 26, 2024, to that certain Credit Agreement, dated March 29, 2023, by and among Skyward Specialty Inc., the lenders from time to time party thereto and Truist Bank, as administrative agent (incorporated by reference to Exhibit 10.28 to the Company’s Annual Report on Form 10-K, filed with the SEC on April 1, 2024).

Exhibits, Financial Statement Schedules.

Exhibit Number	Exhibit Description
10.26	Guaranty Agreement, dated March 29, 2023, by and among Skyward Service Company, Skyward Underwriters Agency, Inc., the loan parties identified on the signature pages thereto and Truist Bank. (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed with the Commission on April 3, 2023).
10.27	Advances and Security Agreement, dated August 1, 2024, by and between Houston Specialty Insurance Company, a wholly owned insurance company subsidiary of the Company and the Federal Home Loan Bank of Dallas (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on September 6, 2024).
10.28+	Form of Severance Agreement between the Company and executive officers (other than the CEO) (incorporated by reference to Exhibit 10.30 to the Company’s Annual Report on Form 10-K, filed with the SEC on March 3, 2025).
10.29+	Amendment No. 2 to Employment Agreement between the Registrant and Andrew Robinson dated March 1, 2025 (incorporated by reference to Exhibit 10.31 to the Company’s Annual Report on Form 10-K, filed with the SEC on March 3, 2025).
10.30+	Amended Form of Restricted Stock Unit (Executives) Agreement under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 99.21 to the Company’s Registration Statement on Form S-8, filed with the SEC on March 5, 2025).
10.31+	Amended Form of the Restricted Stock Unit (Others) Agreement under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 99.22 to the Company’s Registration Statement on Form S-8, filed with the SEC on March 5, 2025).
10.32+	Amended Form of Performance Share (Executives) Agreement under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 99.23 to the Company’s Registration Statement on Form S-8, filed with the SEC on March 5, 2025).
10.33+	Amended Form of Performance Share (Others) Agreement under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 99.24 to the Company’s Registration Statement on Form S-8, filed with the SEC on March 5, 2025).
10.34+	Amended Form of Performance Share (GBVPS) (Executives) Agreement under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 99.25 to the Company’s Registration Statement on Form S-8, filed with the SEC on March 5, 2025).
10.35+	Amended Form of Performance Share (GBVPS) (Others) Agreement under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 99.26 to the Company’s Registration Statement on Form S-8, filed with the SEC on March 5, 2025).
10.36+	Amended Form of Long-Term Performance Cash Plan and Award Letter under the Company’s 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 99.27 to the Company’s Registration Statement on Form S-8, filed with the SEC on March 5, 2025).
10.37	Share Purchase Agreement, dated September 2, 2025, by and between Skyward Specialty Insurance Group, Inc. and Apollo institutional shareholders, of Apollo Group Holdings Limited (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the Commission on September 8, 2025).
10.38	Share Purchase Agreement, dated September 2, 2025, by and between Skyward Specialty Insurance Group, Inc. and Apollo management shareholders, of Apollo Group Holdings Limited (incorporated by reference to Exhibit 2.2 to the Company’s Current Report on Form 8-K filed with the Commission on September 8, 2025).
10.39	Credit Agreement, dated November 13, 2025, by and between Skyward Specialty Insurance Group, Inc. and Barclays Bank PLC, as Administrative Agent, Truist Securities, Inc., Citizens Bank, N.A. and Texas Capital Bank (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed with the Commission on November 18, 2025).
10.40	Guaranty Agreement, dated November 13, 2025, by and among Skyward Specialty Insurance Group, Inc., Skyward Service Company, Skyward Underwriters Agency, Inc., the loan parties identified on the signature pages thereto and Barclays Bank PLC. Barclays Bank PLC (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed with the Commission on November 18, 2025).
10.41	Term Loan Credit Agreement, dated December 30, 2025, by and among Skyward Specialty Insurance Group, Inc., and Barclays Bank PLC, as Administrative Agent, Truist Securities, Inc., Citizens Bank, N.A. and Texas Capital Bank (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed with the Commission on January 6, 2026).
10.42	Guaranty Agreement, dated December 30, 2025, by and among Skyward Specialty Insurance Group, Inc., Skyward Service Company, Skyward Underwriters Agency, Inc., the loan parties identified on the signature pages and Barclays Bank PLC (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed with the Commission on January 6, 2026).

Exhibits, Financial Statement Schedules.

Exhibit Number	Exhibit Description
10.43	First Amendment, dated December 30, 2025, by and among Skyward Specialty Insurance Group, Inc., Skyward Service Company, Skyward Underwriters Agency, Inc., the loan parties identified on the signature pages and Barclays Bank PLC (incorporated by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed with the Commission on January 6, 2026).
19	Skyward Specialty Insurance Securities Trading Policy (incorporated by reference to Exhibit 19 to the Company ’ s Annual Report on Form 10-K, filed with the SEC on March 3, 2025).
19.1*	Skyward Specialty Insurance Securities Trading Policy amended November 5, 2025.
21.1*	List of Subsidiaries of the Company
23.1*	Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm.
31.1*	Certification of Principal Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of Principal Financial and Accounting Officer pursuant to Rule 13a 14(a) or Rule 15d 14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*	Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
97	Policy for Recovery of Erroneously Awarded Incentive Compensation (“Clawback Policy”) (incorporated by reference to Exhibit 97 to the Company’s Annual Report on Form 10-K, filed with the SEC on April 1, 2024).
101.INS	Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document.
101.SCH	Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents
104	Cover Page Interactive Date File (embedded within the Inline XBRL document)

Schedule i — summary of investments — other than in related parties

Schedule i — summary of investments — other than in related parties

($ in thousands)	Cost	Fair Value (if applicable)	Amount on Balance Sheet
December 31, 2025
Fixed maturity securities, available for sale:	—	—	—
U.S. government securities	44,190	44,468	44,468
Corporate securities and miscellaneous	632,244	636,387	636,387
Municipal securities	102,691	102,116	102,116
Residential mortgage-backed securities	487,145	486,587	486,587
Commercial mortgage-backed securities	72,631	73,050	73,050
Other asset-backed securities	509,854	513,695	513,695
Total fixed maturity securities, available for sale	1,848,755	1,856,303	1,856,303
Other asset-backed securities	33,290	33,603	32,822
Total fixed maturity securities, held to maturity	33,290	33,603	32,822
Preferred stocks	1,138	1,174	1,174
Total equity securities	1,138	1,174	1,174
Mortgage loans	10,093	9,902	9,902
Other long-term investments	37,290	58,650	58,650
Short-term investments	264,299	264,299	264,299
Total	2,194,865	2,223,931	2,223,150

Balance sheets (parent company)

Balance sheets (parent company)

	December 31,
($ in thousands)	2025	2024
Assets
Investments:	—	—
Investment in subsidiaries	1,076,288	853,670
Short-term investments, at fair value	14,513	14,000
Total investments	1,090,801	867,670
Cash and cash equivalents	3,500	2,943
Deferred income taxes	27,865	30,486
Goodwill and intangible assets, net	14,349	12,641
Other assets	10,709	2,905
Total assets	1,147,224	916,645
Liabilities and Stockholders’ Equity	—	—
Accounts payable and accrued liabilities	17,680	3,110
Notes payable	100,410	100,000
Subordinated debt, net of debt issuance costs	19,569	19,536
Total liabilities	137,659	122,646
Stockholders’ Equity:	—	—
Stockholders’ equity	1,009,565	793,999
Total liabilities and stockholders’ equity	1,147,224	916,645

(parent company)

• See accompanying notes to financial statements ^{p. 122}.

(parent company)

	Years Ended December 31,
($ in thousands)	2025	2024	2023
Revenues:	—	—	—
Net investment income	3,371	3,212	3,822
Net investment gains (losses)	—	963	( 963 )
Other loss	—	( 2 )	( 27 )
Total revenues	3,371	4,173	2,832
Operating expenses	7,899	10,632	—
Interest expense	6,762	8,140	9,815
Amortization expense	620	920	313
Other expenses	17,962	9,646	451
Total expenses	33,243	29,338	10,579
Loss before income tax expense	( 29,872 )	( 25,165 )	( 7,747 )
Income tax expense	45,860	33,578	6,808
Loss before equity in earnings of subsidiaries	( 75,732 )	( 58,743 )	( 14,555 )
Equity in undistributed earnings of subsidiaries	245,760	177,571	100,539
Net income	170,028	118,828	85,984

Schedule ii — statements of cash flows (parent company)

• Cash provided by operating activities was USD 100,000 for the year ended December 31, 2023 ^{p. 123}.
• Cash used in investing activities was USD 100,000 for the year ended December 31, 2023 ^{p. 123}.
• Cash provided by financing activities was USD 0 for the year ended December 31, 2023 ^{p. 123}.
• Net increase in cash and cash equivalents was USD 0 for the year ended December 31, 2023 ^{p. 123}.
• Cash and cash equivalents at beginning of period were USD 0 for the year ended December 31, 2023 ^{p. 123}.
• Cash and cash equivalents at end of period were USD 0 for the year ended December 31, 2023 ^{p. 123}.
• Cash provided by operating activities was USD 100,000 for the year ended December 31, 2022 ^{p. 123}.
• Cash used in investing activities was USD 100,000 for the year ended December 31, 2022 ^{p. 123}.
• Cash provided by financing activities was USD 0 for the year ended December 31, 2022 ^{p. 123}.
• Net increase in cash and cash equivalents was USD 0 for the year ended December 31, 2022 ^{p. 123}.
• Cash and cash equivalents at beginning of period were USD 0 for the year ended December 31, 2022 ^{p. 123}.
• Cash and cash equivalents at end of period were USD 0 for the year ended December 31, 2022 ^{p. 123}.
• Cash provided by operating activities was USD 100,000 for the year ended December 31, 2021 ^{p. 123}.
• Cash used in investing activities was USD 100,000 for the year ended December 31, 2021 ^{p. 123}.
• Cash provided by financing activities was USD 0 for the year ended December 31, 2021 ^{p. 123}.
• Net increase in cash and cash equivalents was USD 0 for the year ended December 31, 2021 ^{p. 123}.
• Cash and cash equivalents at beginning of period were USD 0 for the year ended December 31, 2021 ^{p. 123}.
• Cash and cash equivalents at end of period were USD 0 for the year ended December 31, 2021 ^{p. 123}.

Schedule ii — statements of cash flows (parent company)

	Years Ended December 31,
($ in thousands)	2025	2024	2023
Cash flows from operating activities:	—	—	—
Net income	170,028	118,828	85,984
Adjustments to reconcile net income to net cash used in operating activities	( 175,769 )	( 121,563 )	( 95,947 )
Net cash used in operating activities	( 5,741 )	( 2,735 )	( 9,963 )
Purchase of intangible assets and goodwill	( 2,000 )	—	—
Capital contributions to subsidiaries	( 100 )	—	( 122,800 )
Distributions from investment in subsidiaries	8,500	8,500	6,500
Change in short-term investments	( 513 )	( 3,407 )	( 10,569 )
Net cash provided by (used in) investing activities	5,887	5,093	( 126,869 )
Repayment of stock notes receivable	—	5,561	1,350
Proceeds from long term borrowings	43,411	107,000	50,000
Payments on long term borrowings and trust preferred	( 43,000 )	( 115,000 )	( 50,000 )
Proceeds from equity offerings	—	—	128,887
Proceeds from employee stock purchase plan	—	—	710
Net cash provided by (used in) financing activities	411	( 2,439 )	130,947
Net increase (decrease) in cash and cash equivalents and restricted cash	557	( 81 )	( 5,885 )
Cash and cash equivalents and restricted cash at beginning of year	2,943	3,024	8,909
Cash and cash equivalents and restricted cash at end of year	3,500	2,943	3,024
Supplemental disclosure of cash flow information:	—	—	—
Cash paid for interest	6,149	8,573	10,667

Notes to Financial Statements

• Intercompany Loan Promissory Note was entered into by Skyward Specialty with Houston Specialty Insurance Company (HSIC) on September 30, 2024 ^{p. 124}.
• Skyward Specialty borrowed USD 57.0 million from HSIC under the Promissory Note ^{p. 124}.
• Interest on the Promissory Note is payable monthly at a fixed annual rate of 4.00% ^{p. 124}.
• Principal of the Promissory Note is due at the maturity date ^{p. 124}.
• Prepayment penalties are not applicable to the Promissory Note ^{p. 124}.
• Collateral was not provided as security for the Promissory Note ^{p. 124}.
• Skyward Specialty provided funds for a new subsidiary, Skyward Specialty No. 1 Limited Company, during the year ended December 31, 2024 ^{p. 124}.
• Skyward Specialty No. 1 Limited Company is a UK company authorized as a Lloyd’s corporate member to invest in Lloyd’s syndicates ^{p. 124}.

Financial Instruments Disclosed, But Not Carried, At Fair Value

• The Promissory Note between Skyward Specialty and HSIC is included in notes payable ^{p. 125}.
• Skyward Specialty determined the fair value of the Promissory Note using the income approach with observable inputs ^{p. 125}.
• The Promissory Note is classified as Level 2 in the fair value hierarchy ^{p. 125}.
• Other financial instruments are exempt from fair value disclosure requirements as they qualify as insurance-related products ^{p. 125}.

Financial Instruments Disclosed, But Not Carried, At Fair Value

	2025		2024
($ in thousands)	Carrying Value	Fair Value	Carrying Value	Fair Value
Notes payable	—	—	—	—
Promissory Note	57,000	57,401	57,000	56,300

Schedule iv — reinsurance

Schedule iv — reinsurance

	Years Ended December 31,
	2025		2024		2023
($ in thousands)	Accident & Health	Property & Casualty	Accident & Health	Property & Casualty	Accident & Health	Property & Casualty
Gross amount	254,102	1,430,309	173,073	1,285,564	151,702	1,089,478
Ceded to other companies	( 143,811 )	( 616,193 )	( 86,503 )	( 533,151 )	( 79,091 )	( 470,047 )
Assumed from other companies	—	481,825	—	284,595	—	218,649
Net amount	110,291	1,295,941	86,570	1,037,008	72,611	838,080
Percentage of amount assumed to net	—%	37.2%	—%	27.4%	—%	26.1%

Schedule v — valuation and qualifying accounts

Schedule v — valuation and qualifying accounts

($ in thousands)	Valuation Allowance For Deferred Tax Assets	Allowance for Uncollectible Reinsurance Recoverable	Allowance for Uncollectible Premiums Receivable
Balance at January 1, 2023	586	—	629
Cumulative effect of adoption of ASU 2016-13 at January 1, 2023	—	2,295	—
Charged to costs and expenses	—	—	748
Amounts written off	—	—	( 513 )
Recoveries of amounts previously written off	—	—	100
Balance at December 31, 2023	586	2,295	964
Charged to costs and expenses	—	13,585	3,235
Amounts written off	—	( 13,585 )	( 1,895 )
Recoveries of amounts previously written off	—	—	128
Balance at December 31, 2024	586	2,295	2,432
Charged to costs and expenses	68	—	2,351
Amounts written off	—	—	( 2,141 )
Recoveries of amounts previously written off	—	—	498
Balance at December 31, 2025	654	2,295	3,140

Insurance operations

Insurance operations (1)(footnote: Amount is presented net of reinsurance.) (2)(footnote: Amount does not include gain on retroactive reinsurance which is included in losses and loss adjustment expenses presented on the Consolidated Statements of Operations.)

	As of and Years Ended December 31,
($ in thousands)	2025	2024	2023
Deferred policy acquisition costs	136,100	113,183	91,955
Reserve for losses and loss adjustment expenses	2,318,894	1,782,383	1,314,501
Unearned premiums	774,035	637,185	552,532
Net earned premium (1)	1,304,505	1,056,722	829,143
Net investment income	83,619	80,686	40,322
Losses and loss adjustment expenses (current year) (1)	810,375	657,783	516,664
Losses and loss adjustment expenses (prior years) (1)(2)	( 7,471 )	25,728	—
Amortization of policy acquisition costs (1)	195,422	149,975	108,514
Paid claims and claim adjustment expenses (1)	516,712	430,991	363,418
Net premiums written (1)	1,406,232	1,123,578	910,691
Ceded unearned premium	238,948	203,901	186,121
Deferred ceding commission	46,453	40,434	37,057

Signatures

• This report was signed on behalf of the registrant pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934 ^{p. 126}.
• This report was signed by the indicated persons on behalf of the Registrant, in their capacities, and on the dates indicated, pursuant to the requirements of the Securities Exchange Act of 1934 ^{p. 126}.

Signatures

—	Skyward Specialty Insurance Group, Inc.
Dated: March 2, 2026	/s/ Andrew Robinson
—	Andrew Robinson Chairman and Chief Executive Officer

Signatures

Signature	Title	Date
/s/ Andrew Robinson	Chairman and Chief Executive Officer	March 2, 2026
Andrew Robinson	(Principal Executive Officer)	March 2, 2026
/s/ Mark Haushill	Chief Financial Officer	March 2, 2026
Mark Haushill	(Principal Financial and Accounting Officer)	March 2, 2026
/s/ Gena Ashe	Director	March 2, 2026
Gena Ashe	Director	March 2, 2026
/s/ Robert Creager	Director	March 2, 2026
Robert Creager	Director	March 2, 2026
/s/ Marcia Dall	Director	March 2, 2026
Marcia Dall	Director	March 2, 2026
/s/ James Hays	Director	March 2, 2026
James Hays	Director	March 2, 2026
/s/ Anthony J. Kuczinski	Director	March 2, 2026
Anthony J. Kuczinski	Director	March 2, 2026
/s/ Michael Morrissey	Director	March 2, 2026
Michael Morrissey	Director	March 2, 2026
/s/ Christopher L. Peirce	Director	March 2, 2026
Christopher L. Peirce	Director	March 2, 2026
/s/ Katharine Terry	Director	March 2, 2026
Katharine Terry	Director	March 2, 2026