Hanover earnings fell in the third quarter of 2026, with net income of $172.6 million compared with $178.7 million a year earlier. The insurer reported higher catastrophe losses and a higher combined ratio, even as premiums and investment income grew.

Key Takeaways

  • Operating income declined to $183.1 million from $185.6 million a year earlier.
  • The combined ratio rose to 92.3% from 91.1%, while the catastrophe loss bill was $109.7 million.
  • Net investment income increased 12.7%, and Hanover repurchased approximately $86 million of shares during the quarter.

Hanover earnings and premium growth

Net premiums written increased 3% to $1.79 billion from $1.74 billion in the third quarter of 2025. Net premiums earned rose 3.9% to $1.61 billion from $1.55 billion.

The property and casualty insurer offers personal, commercial and specialty coverage. Operating earnings per share were $5.15, and operating return on equity was 18.7%, CEO John C. Roche said.

Catastrophe losses lift underwriting ratio

Catastrophe losses accounted for 6.8 percentage points of the third-quarter combined ratio. The loss and loss adjustment expense ratio rose 1.6 percentage points to 61.4%, driven by higher catastrophe losses.

Excluding catastrophes, the current accident year loss and loss adjustment expense ratio improved by 1.9 percentage points to 55.7%. The expense ratio also improved, falling to 30.9% from 31.3%.

The combined ratio measures claims and expenses against earned premiums; a ratio below 100% generally indicates an underwriting profit before investment income.

Investment income and share repurchases

Net investment income reached $131.9 million. Hanover attributed the increase primarily to investing cash flows from operations, higher earned yields on its fixed maturity portfolio and increased income from limited partnerships.

CFO Jeffrey M. Farber said the company repurchased approximately $86 million of stock during the quarter. Repurchases totaled $263 million for the year through October 26.

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