Specialty insurance provider RLI (NYSE: RLI) beat Wall Street’s revenue expectations in Q2 CY2026, with sales up 30.6% year on year to $575.6 million. Its non-GAAP profit of $0.83 per share was 15.3% above analysts’ consensus estimates.
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RLI (RLI) Q2 CY2026 Highlights:
- Net Premiums Earned: $417.1 million vs analyst estimates of $411 million (3.8% year-on-year growth, 1.5% beat)
- Revenue: $575.6 million vs analyst estimates of $458.1 million (30.6% year-on-year growth, 25.6% beat)
- Combined Ratio: 85.6% vs analyst estimates of 89.2% (357.1 basis point beat)
- Adjusted EPS: $0.83 vs analyst estimates of $0.72 (15.3% beat)
- Book Value per Share: $19.09 vs analyst estimates of $19.44 (1.1% year-on-year growth, 1.8% miss)
- Market Capitalization: $5.53 billion
Company Overview
Founded in 1965 and named after its original focus on "replacement lens insurance" for contact lens wearers, RLI (NYSE: RLI) is a specialty insurance company that underwrites property, casualty, and surety products through wholesale brokers, independent agents, and carrier partnerships.
Revenue Growth
Big picture, insurers generate revenue from three key sources. The first is the core business of underwriting policies. The second source is income from investing the “float” (premiums collected upfront not yet paid out as claims) in assets such as fixed-income assets and equities. The third is fees from various sources such as policy administration, annuities, or other value-added services. Over the last five years, RLI grew its revenue at an exceptional 14.6% compounded annual growth rate. Its growth beat the average insurance company and shows its offerings resonate with customers.
Long-term growth is the most important, but within financials, a half-decade historical view may miss recent interest rate changes and market returns. RLI’s annualized revenue growth of 12.1% over the last two years is below its five-year trend, but we still think the results suggest healthy demand. 
Note: Quarters not shown were determined to be outliers because they were impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.
This quarter, RLI reported wonderful year-on-year revenue growth of 30.6%, and its $575.6 million of revenue exceeded Wall Street’s estimates by 25.6%.
Net premiums earned made up 90.2% of the company’s total revenue during the last five years, meaning RLI lives and dies by its underwriting activities because non-insurance operations barely move the needle.
Our experience and research show the market cares primarily about an insurer’s net premiums earned growth as investment and fee income are considered more susceptible to market volatility and economic cycles.
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Book Value Per Share (BVPS)
Insurance companies are balance sheet businesses, collecting premiums upfront and paying out claims over time. The float — premiums collected but not yet paid out — is invested, creating an asset base supported by a liability structure. Book value captures this dynamic by measuring:
- Assets (investment portfolio, cash, reinsurance recoverables) - liabilities (claim reserves, debt, future policy benefits)
BVPS is essentially the residual value for shareholders.
We therefore consider BVPS very important to track for insurers and a metric that sheds light on business quality. While other (and more commonly known) per-share metrics like EPS can sometimes be lumpy due to reserve releases or one-time items and can be managed or skewed while still following accounting rules, BVPS reflects long-term capital growth and is harder to manipulate.
RLI’s BVPS grew at a mediocre 6.8% annual clip over the last five years. BVPS growth has also recently decelerated a bit to 5% annual growth over the last two years (from $17.32 to $19.09 per share).
Over the next 12 months, Consensus estimates call for RLI’s BVPS to grow by 3.7% to $19.44, lousy growth rate.
Key Takeaways from RLI’s Q2 Results
We were impressed by how significantly RLI blew past analysts’ revenue expectations this quarter. We were also glad its EPS outperformed Wall Street’s estimates. On the other hand, its book value per share missed. Overall, we think this was a solid quarter with some key areas of upside. The stock remained flat at $59.03 immediately after reporting.
Should you buy the stock or not? If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here (it’s free).
