Conifer Holdings Reports 2025 Second Quarter Financial Results

Rhea-AI Summary

Conifer Holdings (Nasdaq: CNFR) reported its Q2 2025 financial results, posting net income of $2.1 million ($0.17 per share), compared to a loss in the prior year period. The company's gross written premiums increased 11.1% to $21.1 million, driven by growth in Personal Lines business, particularly in homeowners' insurance in Texas and the Midwest.

Key metrics include net investment income of $1.3 million and a book value increase to $2.31 per share. Personal Lines represented 84.9% of total premiums, growing 46.8% to $17.9 million. However, the company reported a combined ratio of 121.1%, indicating underwriting losses, and an adjusted operating loss of $2.1 million ($0.17 per share).

Positive

• Net income of $2.1 million ($0.17 per share) compared to prior year loss
• Gross written premiums increased 11.1% to $21.1 million
• Personal Lines business grew 46.8% to $17.9 million
• Book value increased to $2.31 per share
• Loss ratio improved to 68.8% from 91.5% year-over-year

Negative

• Combined ratio remained high at 121.1%, indicating significant underwriting losses
• Adjusted operating loss of $2.1 million ($0.17 per share)
• Net investment income declined 11.9% to $1.3 million
• Expense ratio increased to 52.3% from 32.1% year-over-year
• Commercial Lines gross written premiums decreased 53% year-over-year

Insights

Insurance Industry Analyst

Conifer shows positive net income but core underwriting operations remain unprofitable with a concerning 121.1% combined ratio.

Conifer's Q2 2025 results reveal a misleading headline profitability picture. While reporting $2.1 million in net income ($0.17 per share), this figure stems primarily from a non-recurring earnout recognition related to last year's CIS sale rather than improved operations.

The company's core insurance business continues to struggle significantly, as evidenced by the 121.1% combined ratio (anything above 100% indicates underwriting losses). More concerning is the adjusted operating loss of $2.1 million, which better reflects the company's true operating performance by excluding the one-time earnout benefit.

On the positive side, gross written premiums increased 11.1% year-over-year to $21.1 million, driven by 46.8% growth in Personal Lines, particularly in the low-value dwelling homeowners segment in Texas and the Midwest. However, net written premiums plummeted 89.6%, indicating heavy reinsurance use - a strategy that provides short-term capital relief but reduces long-term profit potential.

The dramatic business mix shift is noteworthy, with Commercial Lines now representing just 15.1% of gross written premium (down from 35.7% last year). This strategic pivot appears necessary but disruptive - Commercial Lines posted a catastrophic 257.3% combined ratio, suggesting severe underwriting issues in the remaining business.

Personal Lines, while growing, still operates at an unprofitable 114.2% combined ratio. The expense ratio increased to 52.3%, partly due to a new quota share treaty, creating additional efficiency challenges.

Conifer's book value improved to $2.31 per share, but the company's fundamental insurance operations require significant improvement to achieve sustainable profitability.

TROY, Mich., Aug. 13, 2025 (GLOBE NEWSWIRE) -- Conifer Holdings, Inc. (Nasdaq: CNFR) (“Conifer” or the “Company”) today announced results for the second quarter ended June 30, 2025.

Second Quarter 2025 Financial Highlights

• Net income allocable to common shareholders of $2.1 million, or $0.17 per share
• Gains in the quarter due largely to valuation recognition of an earnout
• Net investment income of $1.3 million
• Book value increased to $2.31 per common share outstanding

Management Comments

Brian Roney, CEO of Conifer, commented, "We are encouraged by progress made to date in streamlining our organization and focusing on our core lines going forward. The Company continues to simplify operations as the last part of our Commercial Lines production is largely running off at this point. Overall, our gross written premium was up double digits for the period led by our Personal Lines business, which after a tough first quarter is coming back in line with expected performance metrics. Additionally, the quarter’s results were positively impacted by the partial recognition of an earnout related to the CIS sale from last year."

2025 Second Quarter Financial Results Overview

	At and for the Three Months Ended June 30,											At and for the Six Months Ended June 30,
	2025				2024				% Change			2025				2024				% Change
	(dollars in thousands, except share and per share amounts)
Gross written premiums	$	21,079			$	18,971			11.1	%		$	37,252			$	43,284			-13.9	%
Net written premiums		1,383				13,247			-89.6	%			12,223				28,638			-57.3	%
Net earned premiums		9,564				16,666			-42.6	%			19,879				33,553			-40.8	%
Net investment income		1,298				1,473			-11.9	%			2,587				3,019			-14.3	%
Net realized investment gains (losses)		(28	)			(118	)		**				(25	)			(118	)		**
Change in fair value of equity investments		(65	)			(196	)		**				(257	)			(153	)		**
Net income (loss) allocable to common shareholders		2,051				(3,950	)		**				2,573				(3,876	)		**
Net income (loss) allocable to common shareholders per share, diluted	$	0.17			$	(0.32	)		**			$	0.21			$	(0.32	)
Adjusted operating income (loss)*		(2,070	)			(3,414	)		**				(5,754	)			(1,888	)		**
Adjusted operating income (loss) per share, diluted*	$	(0.17	)		$	(0.28	)		**			$	(0.47	)		$	(0.15	)		**
Book value per common share outstanding	$	2.31			$	(0.10	)					$	2.31			$	(0.10	)
Weighted average shares outstanding, basic and diluted		12,222,881				12,222,881							12,222,881				12,222,881
Underwriting ratios:
Loss ratio (1)		68.8	%			91.5	%						79.7	%			76.6	%
Expense ratio (2)		52.3	%			32.1	%						51.5	%			33.4	%
Combined ratio (3)		121.1	%			123.6	%						131.2	%			110.0	%
* The "Definitions of Non-GAAP Measures" section of this release defines and reconciles data that are not based on generally accepted accounting principles.
** Percentage is not meaningful
(1) The loss ratio is the ratio, expressed as a percentage, of net losses and loss adjustment expenses to net earned premiums and other income from underwriting operations.
(2) The expense ratio is the ratio, expressed as a percentage, of policy acquisition costs and other underwriting expenses to net earned premiums and other income from underwriting operations.
(3) The combined ratio is the sum of the loss ratio and the expense ratio. A combined ratio under 100% indicates an underwriting profit. A combined ratio over 100% indicates an underwriting loss.

2025 Second Quarter Gross Written Premium

Gross written premiums increased 11.1% in the second quarter of 2025 to $21.1 million, compared to $19.0 million in the prior year period. This increase was led largely by the Company’s renewed focus on disciplined underwriting in its homeowners’ lines of business in Texas and the Midwest.

Performance in these lines of business improved substantially compared to the first quarter of 2025, during which the Company saw considerable impact from storm activity. Metrics across the portfolio are beginning to line up with expected targets.

Commercial Lines Financial and Operational Review

Commercial Lines Financial Review
	Three Months Ended June 30,											Six Months Ended June 30,
	2025				2024				% Change			2025				2024				% Change
	(dollars in thousands)
Gross written premiums	$	3,190			$	6,782			-53.0	%		$	5,237			$	19,544			-73.2	%
Net written premiums		(433	)			4,285			**				(2,036	)			12,572			**
Net earned premiums		468				8,681			-94.6	%			1,799				17,478			-89.7	%
Underwriting ratios:
Loss ratio		216.4	%			79.4	%						140.0	%			77.9	%
Expense ratio		40.9	%			25.3	%						29.5	%			29.1	%
Combined ratio		257.3	%			104.7	%						169.5	%			107.0	%
Contribution to combined ratio from net (favorable) adverse prior year development		26.7	%			23.6	%						-27.5	%			12.0	%
Accident year combined ratio (1)		230.6	%			81.1	%						197.0	%			95.0	%
** Percentage is not meaningful
(1) The accident year combined ratio is the sum of the loss ratio and the expense ratio, less changes in net ultimate loss estimates from prior accident year loss reserves. The accident year combined ratio provides management with an assessment of the specific policy year's profitability and assists management in their evaluation of product pricing levels and quality of business written.

The Company’s commercial lines of business represented 15.1% of total gross written premium in the second quarter of 2025. As noted above, premiums decreased considerably year over year as Conifer continued to focus its underwriting efforts on Personal Lines business, notably our homeowners’ insurance portfolio in Texas and the Midwest.

Personal Lines Financial and Operational Review

Personal Lines Financial Review
	Three Months Ended June 30,											Six Months Ended June 30,
	2025				2024				% Change			2025				2024				% Change
	(dollars in thousands)
Gross written premiums	$	17,889			$	12,189			46.8	%		$	32,015			$	23,740			34.9	%
Net written premiums		1,816				8,962			-79.7	%			14,259				16,066			-11.2	%
Net earned premiums		9,096				7,985			13.9	%			18,080				16,075			12.5	%
Underwriting ratios:
Loss ratio		61.2	%			104.6	%						73.7	%			75.2	%
Expense ratio		53.0	%			39.5	%						53.8	%			38.1	%
Combined ratio		114.2	%			144.1	%						127.5	%			113.3	%
Contribution to combined ratio from net (favorable) adverse prior year development		4.7	%			9.3	%						6.6	%			1.4	%
Accident year combined ratio		109.5	%			134.8	%						120.9	%			111.9	%

Personal lines, representing 84.9% of total gross written premium for the quarter, consist primarily of low-value dwelling homeowners’ insurance in Texas and the Midwest.

Personal lines gross written premium increased 46.8% from the prior year period to $17.9 million for the second quarter of 2025, led by growth in the Company’s low-value dwelling line of business in Texas. The expense ratio increased in part due to a quota share treaty effective June 1, 2025, which reduces net earned premium.

Combined Ratio Analysis

	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
Underwriting ratios:
Loss ratio	68.8	%		91.5	%		79.7	%		76.6	%
Expense ratio	52.3	%		32.1	%		51.5	%		33.4	%
Combined ratio	121.1	%		123.6	%		131.2	%		110.0	%
Contribution to combined ratio from net (favorable) adverse prior year development	5.8	%		16.8	%		3.5	%		6.9	%
Accident year combined ratio	115.3	%		106.8	%		127.7	%		103.1	%

Net Investment Income

Net investment income was $1.3 million for the quarter ended June 30, 2025, compared to
$1.5 million in the prior year period.

Change in Fair Value of Equity Securities

During the quarter, the Company reported a modest loss from the change in fair value of equity investments of $65,000, compared to a $196,000 loss in the prior year period.

Net Income (Loss) allocable to common shareholders

The Company reported net income allocable to common shareholders of $2.1 million, or $0.17 per share, for the second quarter of 2025.

Adjusted Operating Income (Loss)

The Company reported an adjusted operating loss of $2.1 million, or $0.17 per share, for the second quarter ended June 30, 2025. See Definitions of Non-GAAP Measures.

About Conifer Holdings

Conifer Holdings, Inc. is a Michigan-based property and casualty holding company. Through its subsidiaries, Conifer offers specialty insurance coverage for both commercial and personal lines, marketing through independent agents. The Company trades on the Nasdaq Capital Market under the symbol CNFR. Additional information is available on the Company's website at www.ir.cnfrh.com.

Definitions of Non-GAAP Measures

Conifer prepares its public financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP). Statutory data is prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners' (NAIC) Accounting Practices and Procedures Manual and therefore is not reconciled to GAAP data.

We believe that investors’ understanding of Conifer’s performance is enhanced by our disclosure of adjusted operating income. Our method of calculating this measure may differ from that used by other companies and therefore comparability may be limited. We define adjusted operating income (loss), a non-GAAP measure, as net income (loss) excluding: 1) net realized investment gains and losses, 2) change in fair value of equity securities, 3) Change in fair value of contingent considerations, 4) Contingent consideration bonus expense and 5) net income or loss from discontinued operations. We use adjusted operating income as an internal performance measure in the management of our operations because we believe it gives our management and other users of our financial information useful insight into the results of our operations and underlying business performance.

Forward-Looking Statement

This press release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give current expectations or forecasts of future events or our future financial or operating performance, and include Conifer’s expectations regarding premiums, earnings, its capital position, expansion, and growth strategies. The forward-looking statements contained in this press release are based on management’s good-faith belief and reasonable judgment based on current information. The forward-looking statements are qualified by important factors, risks and uncertainties, many of which are beyond our control, that could cause our actual results to differ materially from those in the forward-looking statements, including those described in our form 10-K (“Item 1A Risk Factors”) filed with the SEC on March 28, 2025 and subsequent reports filed with or furnished to the SEC. Any forward-looking statement made by us in this report speaks only as of the date hereof or as of the date specified herein. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by applicable laws or regulations.

Reconciliations of adjusted operating income (loss) and adjusted operating income (loss) per share:

	Three Months Ended June 30,								Six Months Ended June 30,
		2025				2024				2025				2024
	(dollar in thousands, except share and per share amounts)
Net income (loss)	$	2,051			$	(3,792	)		$	2,573			$	(3,561	)
Less:
Net realized investment gains (losses)		(28	)			(118	)			(25	)			(118	)
Change in fair value of equity securities		(65	)			(196	)			(257	)			(153	)
Change in fair value of contingent considerations		5,355				-				9,750				-
Contingent consideration bonus expense		(1,141	)							(1,141	)
Net income (loss) from discontinued operations		-				(64	)			-				(1,402	)
Impact of income tax expense (benefit) from adjustments *		-				-				-				-
Adjusted operating income (loss)	$	(2,070	)		$	(3,414	)		$	(5,754	)		$	(1,888	)
Weighted average common shares, diluted		12,222,881				12,222,881				12,222,881				12,222,881
Diluted income (loss) per common share:
Net income (loss)	$	0.17			$	(0.31	)		$	0.21			$	(0.29	)
Less:
Net realized investment gains (losses)		-				(0.01	)			-				(0.01	)
Change in fair value of equity securities		(0.01	)			(0.02	)			(0.02	)			(0.02	)
Change in fair value of contingent considerations		0.44				-				0.80				-
Contingent consideration bonus expense		(0.09	)			-				(0.10	)			-
Net income (loss) from discontinued operations		-				-				-				(0.11	)
Impact of income tax expense (benefit) from adjustments *		-				-				-				-
Adjusted operating income (loss), per share	$	(0.17	)		$	(0.28	)		$	(0.47	)		$	(0.15	)

* The Company has recorded a full valuation allowance against its deferred tax assets as of June 30, 2025 and June 30, 2024, respectively. As a result, there were no taxable impacts to adjusted operating income from the adjustments to net income (loss) in the table above after taking into account the use of NOLs and the change in the valuation allowance.

Conifer Holdings, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(dollars in thousands)
	June 30,				December 31,
		2025				2024
Assets	(Unaudited)
Investment securities:
Debt securities, at fair value (amortized cost of $108,000 and $117,827, respectively)	$	97,899			$	105,665
Equity securities, at fair value (cost of $1,832 and $1,836, respectively)		1,342				1,603
Short-term investments, at fair value		36,387				21,151
Total investments		135,628				128,419
Cash and cash equivalents		21,953				27,654
Premiums and agents' balances receivable, net		8,435				9,901
Reinsurance recoverables on unpaid losses		77,892				84,490
Reinsurance recoverables on paid losses		5,863				6,919
Prepaid reinsurance premiums		18,179				6,088
Deferred policy acquisition costs		3,338				6,380
Receivable from contingent considerations		7,820				8,070
Other assets		4,154				3,735
Total assets	$	283,262			$	281,656
Liabilities and Shareholders' Equity
Liabilities:
Unpaid losses and loss adjustment expenses	$	164,644			$	189,285
Unearned premiums		35,239				30,590
Reinsurance premiums payable		9,386				1
Debt		12,060				11,932
Mandatorily redeemable preferred stock		5,885				-
Funds held under reinsurance agreements		21,180				25,829
Accounts payable and other liabilities		6,660				2,494
Total liabilities		255,054				260,131
Commitments and contingencies
Shareholders' equity:
Common stock, no par value (100,000,000 shares authorized; 12,222,881 issued and outstanding, respectively)		100,132				98,178
Accumulated deficit		(60,580	)			(63,153	)
Accumulated other comprehensive income (loss)		(11,344	)			(13,500	)
Total shareholders' equity		28,208				21,525
Total liabilities and shareholders' equity	$	283,262			$	281,656

Conifer Holdings, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations (Unaudited)
(dollars in thousands, except share and per share data)
	Three Months Ended								Six Months Ended
	June 30								June 30
		2025				2024				2025				2024
Revenue and Other Income
Premiums
Gross earned premiums	$	16,484			$	29,381			$	32,602			$	63,613
Ceded earned premiums		(6,920	)			(12,715	)			(12,723	)			(30,060	)
Net earned premiums		9,564				16,666				19,879				33,553
Net investment income		1,298				1,473				2,587				3,019
Net realized investment gains (losses)		(28	)			(118	)			(25	)			(118	)
Change in fair value of equity securities		(65	)			(196	)			(257	)			(153	)
Other income		10				77				75				226
Change in fair value of contingent considerations		5,355				-				9,750				-
Total revenue and other income		16,134				17,902				32,009				36,527
Expenses
Losses and loss adjustment expenses, net		6,564				15,281				15,838				25,801
Policy acquisition costs		2,287				3,392				4,964				6,552
Operating and other expenses		4,368				2,422				7,229				5,072
Interest expense		864				868				1,405				1,745
Total expenses		14,083				21,963				29,436				39,170
Income (loss) from continuing operations before income taxes		2,051				(4,061	)			2,573				(2,643	)
Income tax expense (benefit)		-				(333	)			-				(484	)
Net income (loss) from continuing operations	$	2,051			$	(3,728	)		$	2,573			$	(2,159	)
Net income (loss) from discontinued operations		-				(64	)			-				(1,402	)
Net income (loss)		2,051				(3,792	)			2,573				(3,561	)
Series A Preferred Stock dividends		-				158				-				315
Net income (loss) allocable to common shareholders	$	2,051			$	(3,950	)		$	2,573			$	(3,876	)
Earnings (loss) per common share, basic and diluted
Net income (loss) from continuing operations	$	0.17			$	(0.31	)		$	0.21			$	(0.18	)
Net income (loss) from discontinued operations	$	-			$	(0.01	)		$	-			$	(0.11	)
Net income (loss) allocable to common shareholders	$	0.17			$	(0.32	)		$	0.21			$	(0.32	)
Weighted average common shares outstanding, basic and diluted		12,222,881				12,222,881				12,222,881				12,222,881

For Further Information:
Jessica Gulis, 248.559.0840
ir@cnfrh.com

FAQ

What were Conifer Holdings (CNFR) Q2 2025 earnings results?

Conifer reported net income of $2.1 million ($0.17 per share), with gross written premiums of $21.1 million, up 11.1% year-over-year. However, the company posted an adjusted operating loss of $2.1 million.

How did CNFR's Personal Lines business perform in Q2 2025?

Personal Lines, representing 84.9% of total premiums, grew 46.8% to $17.9 million, driven by growth in low-value dwelling homeowners' insurance in Texas and the Midwest.

What was Conifer Holdings' combined ratio in Q2 2025?

CNFR reported a combined ratio of 121.1%, consisting of a loss ratio of 68.8% and expense ratio of 52.3%, indicating underwriting losses.

How much did CNFR's book value per share change in Q2 2025?

Conifer's book value increased to $2.31 per common share outstanding, compared to -$0.10 in the prior year period.

What happened to CNFR's Commercial Lines business in Q2 2025?

Commercial Lines gross written premiums decreased 53% to $3.19 million as the company focused on streamlining operations and shifting focus to Personal Lines business.