Key Highlights

  • Diluted EPS of USD 1.72 rose 5.5% year over year and topped the USD 0.91 consensus estimate.
  • Total revenue of USD 219.2 million increased 3.2% and edged above the USD 217.3 million consensus estimate.
  • Net combined ratio held near 73.0% even after USD 15.8 million of pre-tax catastrophe losses in the quarter.
  • Book value per share reached USD 20.22, up 42.9% from a year earlier, with annualized return on equity at 35.1%.

Heritage Insurance Holdings, Inc. (NYSE:HRTG) reported third-quarter 2026 net income of USD 51.1 million, or USD 1.72 per diluted share, compared with USD 50.4 million, or USD 1.63 per share, a year earlier. Earnings per share were well above a consensus estimate of USD 0.91. Total revenue was USD 219.2 million, up 3.2% from USD 212.5 million and above a consensus estimate of USD 217.34 million.

The quarter absorbed USD 15.8 million of pre-tax catastrophe losses, including USD 9.1 million from Hurricanes Lala and Lowell and USD 6.7 million from other weather events, mainly a late September Nor'easter. The prior-year quarter had no catastrophe losses. A 4.0% reduction in diluted shares from buybacks added to the per-share gain.

Underwriting and Premium Trends

Net premiums earned grew 5.4% to USD 205.6 million as ceded premiums dropped 11.8% to USD 147.2 million, reflecting cheaper catastrophe reinsurance placed in June 2026 and a smaller northeast quota share. The loss ratio rose 1.3 points to 39.6%, helped by USD 14.0 million of favorable prior-year reserve development versus USD 5.0 million a year earlier. The expense ratio improved 1.2 points to 33.4%, leaving the combined ratio at 73.0% versus 72.9%.

Gross premiums written fell 3.1% to USD 322.8 million, and premiums in force declined 2.8% to USD 1.40 billion, driven by commercial residential pricing pressure in Florida. Commercial residential premiums in force dropped 16.1% to USD 232.1 million, while personal residential premiums edged up 0.2%. Net investment income rose 17.3% to USD 11.4 million on a larger asset base of USD 1.4 billion.

Capital Position and Strategy

Debt-to-capital improved to 10.5% from 15.3%. The company repurchased 100,000 shares for about USD 3.3 million in the quarter and 1,101,508 shares for USD 27.9 million year to date, leaving USD 34.1 million under the current authorization. On October 28, 2026, the board approved a new program of up to USD 50.0 million, running through December 31, 2027 and starting when the existing one expires.

CEO Ernie Garateix said the results show earnings resilience and that the company sees selective growth openings across its markets, including its entry into Texas on an excess and surplus lines basis. He also said management is cautious in areas where competition has intensified. The release contained no numerical earnings guidance. Accumulated other comprehensive loss stood at USD 33.2 million, tied to rising interest rates.

Lines to Follow in the Next Report

Four items frame the next report. The first is the combined ratio of 73.0% against 72.9% a year ago, tested by weather losses that reached USD 33.6 million for the accident quarter versus USD 13.8 million. The second is premiums in force of USD 1.40 billion, where commercial residential shrank 16.1%. The third is reinsurance, with treaty-year savings of USD 63.2 million of which seven-twelfths is recognized in 2026. The fourth is capital return, with USD 34.1 million left on the current buyback through December 31, 2026 and the new USD 50.0 million program beginning after that.