Palomar Holdings, Inc., an insurance holding company, provides specialty property insurance to residential and commercial customers. The company offers personal and commercial specialty property insurance products, including residential and commercial earthquake, commercial all risk, specialty homeowners, inland marine, Hawaii hurricane, and residential flood, as well as other products, such as assumed reinsurance, commercial flood, real estate error and omission, and real estate investor products. It markets and distributes its products through retail agents, wholesale brokers, program administrators, and carrier partnerships. The company was formerly known as GC Palomar Holdings. Palomar Holdings, Inc. was incorporated in 2013 and is headquartered in La Jolla, California.
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Here are 1-3 brief analogies for Palomar (PLMR):
- A State Farm for earthquake and hurricane insurance.
- The Chubb of catastrophe insurance.
- A Lemonade focused on natural disaster insurance.
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Residential Earthquake Insurance: Protects homeowners against financial losses from earthquake damage to their residences.
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Commercial Earthquake Insurance: Provides coverage for businesses and commercial properties against earthquake-related damages.
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Hawaii Hurricane Insurance: Offers property insurance specifically designed to cover losses caused by hurricanes in Hawaii.
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All-Risk and Inland Marine Insurance: Provides comprehensive property and business interruption coverage for various commercial risks, including specialized assets and goods in transit.
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Flood Insurance: Offers coverage for damage to properties caused by flooding, which is typically excluded from standard property insurance policies.
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Palomar Front Row (Homeowners Insurance): A comprehensive homeowners insurance product, often tailored for high-value homes, covering a broad range of perils.
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Palomar Holdings, Inc. (PLMR) sells primarily to a large number of individuals and other companies (businesses) rather than a few major corporate clients. Therefore, its customers are best described by categories rather than specific names.
Palomar specializes in providing property insurance in catastrophe-exposed regions. Its primary customer categories are:
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Residential Property Owners: These are individuals who own homes and seek specialized insurance coverage for their residences. This primarily includes earthquake insurance in regions like California, Oregon, and Washington, as well as hurricane and flood insurance in areas such as Hawaii.
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Small and Medium-Sized Commercial Businesses: These are enterprises that require specialized property insurance solutions for their commercial assets and operations. This category includes businesses seeking earthquake coverage, commercial all-risk policies (which can cover property, general liability, commercial auto, and inland marine), and hurricane/flood insurance in relevant geographical areas.
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- Aon plc (AON)
- PricewaterhouseCoopers LLP
- Vinson & Elkins LLP
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Mac Armstrong, Chairman of the Board, Chief Executive Officer, and Founder
Mac Armstrong has served as Chief Executive Officer and a director of Palomar since February 2014, and is also its founder. Prior to founding Palomar, Mr. Armstrong served as President, Chief Financial Officer, and Chief Operating Officer of Arrowhead General Insurance Agency, which he joined in 2009. He led the sale of Arrowhead to Brown & Brown, Inc. in 2012. Mr. Armstrong's prior experience includes serving as a Principal at Spectrum Equity Investors, a private equity investment firm where he led the insurance investing practice. He also began his career in financial analysis at Alex. Brown & Sons/BT Alex. Brown Inc., an investment bank acquired by Deutsche Bank.
Chris Uchida, Chief Financial Officer
Chris Uchida joined Palomar in 2015 and serves as its Chief Financial Officer. Before joining Palomar, Mr. Uchida served as the Executive Vice President and Chief Accounting Officer at Arrowhead General Insurance Agency, where he started in 2004. He was also a Tax Manager at PricewaterhouseCoopers LLP. Mr. Uchida is a California Certified Public Accountant and earned a B.S. and M.S. from San Diego State University.
Jon Christianson, President
Jon Christianson has served as Palomar's President since April 2022. He previously held the roles of Chief Underwriting Officer since August 2020 and Chief Operating Officer from February 2014 to September 2020. Prior to joining Palomar, Mr. Christianson was a Vice President of Holborn Corporation from April 2010 to December 2013, and began his career with John B. Collins Associates in 2002.
Rodolphe Herve, Chief Operating Officer
Rodolphe "Rudy" Herve was appointed Chief Operating Officer, effective July 1, 2024. Mr. Herve is an experienced insurance executive with over 20 years of expertise across technology, operations, strategic transformations, and mergers and acquisitions. He joined Palomar from SCOR, where he served as Global Head of P&C Operations and previously as CEO of North America and Chief Transformation & Operations Officer for their Specialty Insurance division. His background also includes leadership roles at QBE North America, and earlier positions at Bain & Company, Orange Ventures, and Morgan Stanley.
Angela Grant, Chief Legal Officer, Corporate Secretary
Angela Grant joined Palomar in 2020 and serves as the Chief Legal Officer and Corporate Secretary. Prior to Palomar, Ms. Grant was Chief Legal & Innovation Officer at CSE Insurance Group. She also served as the Head of Compliance & Legal at Hippo Insurance and held leadership roles at Esurance, Kemper, and GEICO, where she gained experience in mergers and acquisitions, corporate governance, and strategy. Ms. Grant received her Juris Doctor from Texas A&M University School of Law.
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Key Risks to Palomar (PLMR)
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Catastrophe Exposure and Reinsurance Dependency: Palomar specializes in underwriting insurance for catastrophe-exposed markets, including earthquake, wind, and flood. This core business model inherently exposes the company to significant financial losses from unpredictable natural disaster events. While Palomar utilizes a comprehensive reinsurance program, including catastrophe bonds, to mitigate these risks, the company remains highly dependent on the availability and affordability of such reinsurance. Fluctuations in the reinsurance market could impact the cost and accessibility of this critical coverage, potentially leading to increased loss retention or reduced underwriting capacity.
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Competitive Market and Pricing Pressure: Palomar operates in a competitive insurance environment, particularly within its cornerstone commercial earthquake business. The company has experienced pricing pressure and rate reductions in this segment, with management expecting continued softening. This competitive landscape can directly impact premium revenue and underwriting margins, presenting a classic insurance cycle challenge where strong performance attracts competition and drives down prices.
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Operational and Strategic Risks from Rapid Growth and Diversification: Palomar is undergoing rapid expansion, with significant growth in gross written premiums and diversification into new product lines and geographies. This rapid growth introduces operational risks, such as rising loss ratios in some of its fast-growing business segments. Additionally, strategic initiatives like acquisitions, while aimed at enhancing the business, introduce integration risks that need to be carefully managed.
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Palomar Holdings (PLMR) operates in several specialty property and casualty insurance markets, primarily within the United States. While precise addressable market sizes for all its individual product lines are not explicitly stated, the following information regarding market sizes and Palomar's position in those markets has been identified:
- U.S. Property and Casualty Market: The broader U.S. property and casualty market had over $965 billion in written premiums in 2023.
- U.S. Excess and Surplus (E&S) Market: This market was valued at $43 billion in the U.S. in 2020. Palomar operates in this market through its subsidiary, Palomar Excess and Surplus Insurance Company (PESIC).
- Earthquake Insurance: Palomar is a significant player in the U.S. earthquake insurance market, ranking as the 2nd largest earthquake insurer in California and the 3rd largest in the U.S. in 2024, with $1.5 billion in gross written premiums.
- Hawaii Hurricane Insurance: Palomar is noted as the second-largest writer of standalone hurricane coverage in Hawaii. Palomar's reinsurance coverage for Hawaii hurricane events totaled $735 million in 2024.
- Crop Insurance: Palomar has stated a goal to grow its crop business to $500 million in premiums in the next few years, with a long-term goal of reaching $1 billion.
- Other Product Lines: Addressable market sizes for Palomar's other main product categories, including Inland Marine, Commercial All Risk, Excess National Property, Residential Flood, Casualty, and Fronting, were not explicitly detailed in the provided information. Therefore, these market sizes are null.
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Palomar (PLMR) is expected to drive future revenue growth over the next 2-3 years through several key strategies:
- Expansion into New Products and Specialty Lines: Palomar is actively expanding its offerings into new products such as Crop, Casualty, Builders Risk, and Healthcare Liability. The company has explicitly highlighted the growth in these new products, with newer lines like Crop and Surety scaling rapidly. Management has set a target of achieving $500 million in crop premiums over the next several years and continuing to expand in high-demand specialty products. This diversification is a key component of their strategy to reduce reliance on any single risk type or region.
- Strategic Acquisitions and Integration: The recent acquisition of Gray Casualty and Surety Company is a significant driver. This acquisition is anticipated to accelerate growth in the surety market, broaden Palomar's national footprint, and enable the company to write larger bonds. The integration of Gray Casualty and Surety is expected to help Palomar achieve its goal of becoming a top-20 surety carrier.
- Diversification of Portfolio: Palomar is strategically broadening its insurance offerings beyond its traditional earthquake coverage. This focus on product expansion, geographic reach, and customer mix aims to build a more resilient and diversified portfolio, reducing exposure to cyclical market swings. This broader diversification across residential and commercial property products and casualty segments is a core part of their "Palomar 2X strategic imperative."
- Investments in Technology, Data Analytics, and Underwriting: The company emphasizes ongoing investments in proprietary technology, data analytics, and advanced underwriting disciplines. These investments are crucial for improving risk assessment, enhancing pricing accuracy, and ultimately boosting underwriting profitability and expanding net margins.
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Share Repurchases
- In March 2021, Palomar's Board of Directors authorized a share repurchase program of up to $40 million, effective until March 31, 2023.
- This program was replaced in January 2022 with a new authorization of up to $100 million for share repurchases, valid through March 31, 2024.
- A subsequent share buyback program of up to $150 million was approved in July 2025, effective from July 31, 2025, for a two-year period ending July 31, 2027. During the third quarter of 2025, the company repurchased 308,417 shares for $37.3 million, with approximately $112.7 million remaining under this authorization.
Share Issuance
- In August 2024, Palomar announced a public offering of 1,200,000 shares of common stock at $88.00 per share, with an option for underwriters to purchase up to an additional 180,000 shares. The net proceeds from this offering were intended for general corporate purposes, including $25.0 million to finance the acquisition of First Indemnity of America Insurance Company and support future growth.
Outbound Investments
- In 2020, Palomar acquired Great American Insurance Group's catastrophe per-occurrence excess of loss reinsurance business.
- The company acquired First Indemnity of America Insurance Company (FIA) in January 2025, which expanded its product offerings into surety bonds for small to medium-sized contractors in the Northeast U.S.
- In March 2025, Palomar entered into an agreement to acquire Advanced AgProtection (AAP), a specialized Crop Managing General Agent, following a strategic investment made in AAP in 2023. This acquisition, expected to close in the second quarter of 2025, is set to enhance Palomar's Crop insurance platform.
- In October 2025, Palomar agreed to acquire The Gray Casualty & Surety Company for $300 million in cash, a transaction anticipated to close in the first half of 2026, aiming to diversify its specialty insurance portfolio by adding contract bonds.
Capital Expenditures
- Palomar's capital expenditures were $1.42 million in 2020, $1.49 million in 2021, $1.66 million in 2022, $2.17 million in 2023, and $1.51 million in 2024.
- The company's capital expenditures are generally focused on investments in technology to enhance underwriting, claims processing, customer service, and to support sustained premium growth and operational scalability.
- Increased capital expenditure contributed to an improvement in free cash flow, which rose by 23.0% from $252.6 million in 2024 to $310.6 million for the trailing twelve months leading up to Q2 2025.
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