Can you provide more detail on the strong casualty lines growth, especially as it's broadly seen as a softer market?

Rick McCathron explained that most casualty growth comes from existing, long-tenured programs, not by chasing new opportunities in a softening market. They also 'cherry-pick' new programs that are well-operated and contribute to their diversification goals. “I think one thing that is really important to recognize is most of our casualty growth is concentrated in existing known long tenured programs to us. This is not us going out and chasing new opportunities, chasing rate, chasing growth.”

How do the economics and bottom-line impact of premiums coming through the Accelerant channel compare to non-Accelerant revenues?

Rick McCathron views Accelerant as a way to grow premium with a partner that has access to many MGA programs, expecting over $500 million next year. Guy Zeltser clarified it's a fairly standard transaction, with commission income comparable to other deals, so it should be modeled as a scale-up in line with ceded earned premium. “This is a fairly standard transaction. So when you model the business going forward and the commission income side specifically, very standard to other deals that we're doing. So it should be viewed as a scale up in line with seated earn premium.”

With rate deceleration and lower reinsurance costs, how is the competitive environment impacting property books (homeowners and commercial), and what are the margin trends?

Rick McCathron confirmed softening in the homeowners and commercial property markets. Hippo's diversified platform allows them to pull back in softening areas and grow in others. Guy Zeltser added that the Progressive partnership, expanding to triple its state footprint by year-end, provides volume, enabling disciplined business selection. “I agree with your sentiment that the homeowner's market is absolutely softening right now, which is one of the reasons why you're seeing an uptick on the commercial and casualty sides of our business.”

HIPO

Hippo Holdings (HIPO) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Financials· Jul 30, 2026

Source: earnings call transcript

Executive summary

Hippo Holdings Inc. Q2 FY26 — Strong Profitability and Accelerated Growth

Hippo delivered its fifth consecutive quarter of profitability, driven by robust premium growth across casualty and commercial multi-peril lines, coupled with enhanced underwriting discipline. The company significantly raised its full-year guidance for both gross written premium and adjusted net income, reflecting confidence in its diversified portfolio strategy and operational leverage gained from AI adoption. Management emphasized optimizing business mix based on market cycles.

Highlights

Generated $10 million of net income, a nearly eight-fold increase over last year.
Achieved $21 million of adjusted net income, a 24% increase over Q2 FY25.
Gross written premium (GWP) grew 61% year-over-year to $482 million.
Combined ratio improved four percentage points year-over-year to 95.8%.
Raised full-year 2026 GWP guidance to $1.65 billion-$1.7 billion (from $1.45 billion-$1.525 billion).

Concerns

Homeowners E&S market is becoming more competitive, leading to a pullback in E&S business.
Prior accident year reserve development was 2% in Q2 FY26, lower than 7% in Q2 FY25.
Commercial property market is experiencing some softening, leading to a pullback in that specific line.

Guidance & targets

Category	Target	Timeline	Confidence
Gross Written Premium (GWP) Target	more than $2.5 billion high materiality	FY28	High
Adjusted Net Income Target	more than $140 million high materiality	FY28	High
Full-year Gross Written Premium (GWP)	$1.65 billion and $1.7 billion high materiality	FY26	High
Full-year Net Written Premium	$565 million and $580 million medium materiality	FY26	High
Full-year Revenue	$580 million and $585 million medium materiality	FY26	High
Full-year Net Combined Ratio	99% and 101% high materiality	FY26	High
Full-year Adjusted Net Income	$62 million and $70 million high materiality	FY26	High
Progressive Partnership State Footprint	triple the state footprint medium materiality	CY26	High

Segment performance

Segment	Revenue	YoY	QoQ	Margin
Homeowners Growth continues to come from Progressive and Westwood partnerships, with admitted growth more than offsetting the pullback in E&S due to increased market competitiveness. Renewal rates are mid to high single digits, expected to moderate but keep pace with loss trends. The company aims for profitable growth in this line. Accounted for 22% of total gross written premium (down from 33% in Q2 FY25)Net written premium: $76 millionNet written premium as % of total: 42% (down from 59% last year)Growth from Progressive and Westwood partnershipsAdmitted growth offsetting E&S pullbackRenewal rates: mid to high single digitRetention: near 100% for attritional loss and lower levels of CAT	$107 million	7%	—	—
Commercial Multi-Peril Had another strong quarter, becoming the second largest line on a gross basis. Retention increased due to a reinsurance structure change, but is expected to return to more historic levels for the full year. Growth is coming from other lines due to softening in commercial property. Accounted for 29% of total gross written premium (up from 28% last year)Net written premium: $51 millionNet written premium as % of total: 28% (up from 24% last year)Retention: 37% (impacted by reinsurance structure change)Expected full-year retention: low 20s	$138 million	65%	—	—
Casualty Fastest growing line this quarter, now the largest line on a gross basis. Increased retention was intentional, driven by a long-tenured program and a program reinsurance change. Growth is concentrated in existing, known programs. Accounted for 37% of total gross written premium (up from 22% last year)Net written premium: $35 million (compared to $2 million in Q2 FY25)Retention: 20% (bolstered by program reinsurance change)Expected full-year retention: mid-teensGrowth led by long-tenured program partner	$180 million	sharply	—	—

Product announcements

Product	Type	Timeline
Hannah	launch	this quarter
Clara	launch	this quarter
Devon	launch	this quarter

Deals & partnerships

Accelerant Capacity provider for MGA programs

Partnership to grow premium with a partner that has access to a large number of MGA programs. Economics are standard compared to other deals.

Progressive Homeowners insurance partnership

Partnership is live in 8 states, with plans to triple the state footprint by the end of this year. Hippo only exposes rates to Progressive customers that fit its desired footprint and underwriting box.

Westwood Homeowners insurance partnership

Integration completed, expanding the builder channel.

Risks & headwinds

Competitive Homeowners E&S Market Q2 FY26

E&S as the market becomes more competitive

Mitigation:Offsetting E&S pullback with admitted growth; focusing on diversified portfolio.

Lower Prior Accident Year Reserve Benefit Q2 FY26

Prior exit and D reserve development was 2% in the second quarter compared to roughly 7% in Q2 of last year.

Mitigation:Not explicitly stated as a risk, but a factor in combined ratio. Focus on underwriting profitability and accident year loss ratio improvement.

Softening Commercial Property Market Q2 FY26

commercial property specifically some softening

Mitigation:Pulling back in this specific line and focusing growth on other lines within Commercial Multi-Peril.

What to watch in Q3 FY26

Progressive partnership state footprint

By end of this year

Current Live in 8 states

Target Triple state footprint

Why it matters

Indicates continued growth potential and diversification for homeowners business through a key partnership.

We're right now live with Progressive at eight states, but we do plan to triple the state footprint by the end of this year, and that is giving us even more volume.

Find out whether HIPO delivers this. Inve re-checks your case every morning.

Q&A highlights

Will Hippo's business mix shift to be less homeowners-focused in the long term, given the strong growth in casualty lines?

Management stated their objective is to build a diversified portfolio, optimizing the mix based on market cycles. While homeowners will continue to grow, casualty and commercial multi-peril lines are being grown to create an optimal balance across the portfolio.

“I think the way everybody should really consider and think about HIPPO is it's our objective to build a very diversified portfolio that allows us to optimize mix, based on a market cycle and market segment.”

asked by Randolph Binner · answered by Richard McCathron

2 min read 6 chapters

Detailed narrative

Profitability and Underwriting Discipline

Hippo achieved its fifth consecutive quarter of profitability, reporting $10 million in net income and $21 million in adjusted net income, representing significant year-over-year improvements. The combined ratio improved by 4 percentage points to 95.8%, driven by a better expense ratio and accident year loss ratio.

The core accident year ex-cat loss ratio stood at 45.8%, marking a nearly 17-point improvement from Q2 2024, underscoring the company's focus on underwriting profitability.

Diversified Growth Strategy and Market Mix

Gross written premium surged 61% to $482 million, primarily fueled by strong performance in Casualty ($180 million) and Commercial Multi-Peril ($138 million), while Homeowners grew 7% to $107 million. Management emphasized a strategy of building a diversified portfolio to optimize business mix.

This involves growing in favorable market segments and pulling back from softening areas, such as E&S homeowners and commercial property, to maintain profitability and balance.

Program Carrier of Choice Expansion

Hippo has expanded its program count to over 50, doubling the number from Q1 FY25, with most of this growth stemming from existing partners. The company continues to invest in its platform, capacity, and technology, including fully automated monthly data ingestion processes that reduce integration time for new programs by 90%.

This focus on capabilities and support positions Hippo as a preferred partner in the MGA space, attracting high-quality programs.

Evolving Reinsurance Structure

The company evolved its reinsurance strategy by renewing its cat bond on attractive terms and adding wildfire as a named peril. A significant change involved moving to corporate group-level catastrophic reinsurance, which reduced PMLs by over 30% across key return periods. Additionally, Hippo introduced its first whole account quota share, enhancing optionality and reducing volatility at the enterprise level, reinforcing its risk management framework.

Operating Leverage and AI Adoption

Operational efficiency gains were evident with the net expense ratio improving 8 percentage points year-over-year to 45.4%, and the fixed expense ratio dropping 39 points from 2024 to 29%. AI initiatives, including Hannah (AI service agent), Clara (AI first notice of loss agent), and Devon (AI software engineer), are now live and contributing to the company's ability to grow its top line without a proportional increase in overhead, making its tech organization more efficient.

Accelerated Growth Targets and Partnerships

Hippo raised its 2028 gross written premium target to over $2.5 billion, a 25% increase over its prior target, and its 2028 adjusted net income target to over $140 million, doubling its 2026 guidance. This acceleration is attributed to the success of new programs, the completed Westwood integration, the expanding Progressive partnership (tripling state footprint by year-end), and scaling the builder channel, demonstrating significant progress against its long-term goals.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.