Arch Capital’s mortgage insurance business hit the $1 billion mark in underwriting income for a fourth consecutive year.

The Bermudian-based insurer and reinsurer is one of the world’s leading insurers of mortgage credit and it detailed the Arch MI division’s success in the company’s 2025 annual report.

Arch, Class of 2001 start-up, celebrates 25 years in business this year and the report describes 2025 as its most successful year yet. Arch booked $3.7 billion of after-tax operating income and a record $15.4 billion in net premiums generated by the property-and-casualty and reinsurance segments.

Since 2001, Arch’s book value per share has grown at a compound annual growth rate of more than 15 per cent.

Growth in the mortgage division is being dampened by economic and housing market conditions, Arch said.

“Growing new insurance written remains challenging because of limited new housing supply and elevated mortgage interest rates, but stable persistency — and the exceptionally strong credit profile of our in‑force book — continued to generate steady returns,” the annual report stated.

The mortgage business derives 86 per cent of its net premiums from the US. The company states it has helped nearly 131,000 US borrowers to purchase or refinance a home.

Arch MI ended 2025 with a delinquency rate of 2.2 per cent, close to an all-time low. The business’s combined ratio — reflecting the proportion of each premium dollar spent on claims and expenses — was 14.6 per cent.

As of December 31, 2025, Arch MI had “risk in force” of $87.9 million — reflecting the unpaid balance of principal of the mortgages covered by its policies.

Arch’s insurance segment delivered $7.8 billion in net premiums and a combined ratio of 95.2 per cent. The reinsurance business produced $7.6 billion and an 80.8 per cent combined ratio.

The company said it added about 800 employees last year, 61 of whom were in the reinsurance division. Arch’s global workforce by the end of the year totalled about 8,000, of whom approximately 4,300 were based in the North America region (including Bermuda, the US and Canada).

Arch CEO Nicolas Papadopoulo, in his annual report commentary, said: “We are operating in a time of rapid change. Competition is robust and AI [artificial intelligence] is transforming both the insurance industry and the global economy.

“We recognise the scale of this change, and we are focused on ensuring Arch is positioned to meet the opportunities ahead.”

Mr Papadopoulo added: “As we enter our 25th year, we do so with measured confidence. Market conditions are evolving, but our diversified specialty platform, strong balance sheet and disciplined approach have us well‑positioned to continue creating long‑term value.

“We will invest in attractive opportunities, remain selective where conditions are competitive and continue advancing the capabilities — from underwriting insight to data, analytics and AI — that strengthen our advantage.”