Beazley (LSE:BEZ) saw its share price drop by more than 10% on Tuesday after the insurer posted weaker-than-expected third-quarter premium figures and trimmed its outlook for 2025.
Written premiums for Q3 came in at $1.48 billion, a decline of 1.3% from the prior year and roughly 5% below Morgan Stanley’s forecast. The brokerage described the result as “top line growth disappointing” and said the quarterly performance was “materially below our expectations” due to underperformance across the Cyber and Marine, Accident and Political divisions.
The company lowered its 2025 premium growth expectations to flat or low single-digit expansion, replacing its earlier guidance that anticipated more robust momentum. Morgan Stanley also noted that Beazley increased its combined operating ratio target for 2025 to the low-80s range from the mid-80s, commenting that this “should be largely expected given a benign Q3 (and Q4-to-date) environment.”
Beazley’s cyber unit—one of its largest—reported a 12% drop in premiums for the quarter. The firm acknowledged that “competition in the US continues to be a challenge,” while pointing out that “the European cyber book is a bright spot and should remain a source of strong growth.”
The Marine, Accident and Political segment registered further top-line weakness, with growth slipping to a 0.6% decline compared with the 8.9% expansion recorded in the first half. Property Risks was the only division to outperform expectations, beating forecasts by 2.5%.
Alongside the quarterly update, Beazley revealed a $500 million capital commitment to establish a new Bermuda platform from 2026. Morgan Stanley said the initiative supports a “drive into the alternative risk market,” though analysts noted the announcement included “minimal details.” They added that the expansion is “a natural step for Beazley,” while highlighting that “$500m is a sizeable sum.”
Investment returns for the quarter reached $150 million—above the $135 million expected by Morgan Stanley but below the $261 million achieved in the same period last year. The company recorded a negative $73 million in investment fund income and expenses. Its core investment book stood at $10.35 billion, with capital growth assets totaling $1.37 billion.
Morgan Stanley kept its “overweight” stance on Beazley shares with a price target of 960p. The stock closed at 860p on 24 November, trading within a 52-week band of 984p to 756p.
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