Nephila Capital, the specialist ILS manager, delivered high revenues and profitability during the third-quarter of 2026 for parent company Markel Group’s financial segment, signifying another step forward in a multi-year effort to develop innovative risk transfer solutions that match investor demand, according to Andrew Crowley, Co-President of Markel Group.
Crowley, who is both Co-President of Markel Group and CEO of Markel Ventures, made these remarks during Markel’s Q3 2026 earnings call earlier this afternoon.
As we reported this morning, Nephila Capital’s insurance-linked securities (ILS) fund management business continues to perform well throughout 2026, as revenues reported within parent Markel’s Q3 2026 results showed an increase of nearly 40% to $42.2 million for the period.
In the first nine months of 2026, Nephila Capital has managed to generate $120.3 million in ILS fund management revenues for its parent company Markel, a nearly 42% increase year-on-year compared to the $85 million generated by the end of September 2025.
Highlighting these results during Markel’s Q3 2026 earnings call, Crowley noted, “In the financial segment, third-quarter revenue and adjusted operating income increased 13% and 30%, respectively. Higher revenue from our insurance-linked securities business was the primary driver of the increase, with additional strength from our lender services business.”
He continued: “The increase in revenue and profitability from our insurance-linked securities business is another step forward in the multi-year effort by our team to develop innovative solutions for risk transfer at a price and structure that meet investor demand.
“Short-term results from this effort can and will vary, but our commitment to innovating and stewarding capital will not.”
Alongside ILS growth, Markel executives addressed broader property market conditions across both the insurance and reinsurance space during the earnings call.
Simon Wilson, Co-President of Markel Group and CEO of Markel Insurance, emphasised that Markel continues to grow where attractive returns are available but acknowledged that the company will remain disciplined in a softer property market.
“There are headwinds. Whether it be in the property market generally across the world, particularly here in the U.S., whether that be in various of the London market lines, we are seeing softening and that’s going to have an impact on the overall economics,” Wilson said.
“I would suggest that property this year is probably off 25% to 30% in our book of business, it is competitive. It was interesting to see the storm season go through, we’re not done with the storm season yet we remember Sandy from 2011, so it’s not over till it’s over, but it’s trending in a way where it’s been very low catastrophes this year.”
He continued: “So I would expect we go into a reinsurance renewal season with some very competitive terms being offered there, and that will lead to more competition as we go into next year. It’s been very, very significant in structured and layered large property placements, and the competition now I think is trending towards smaller and medium-sized property business as well.”
Importantly, Wilson acknowledged that property lines may not have the same margins that it did several years ago, but stressed that we’re not quite at the point “where its underwater yet”.
“I still think there’s profit to be made in that particular area, but we’re getting pretty close,” he added.
“So one would hope and expect, as we go through the course of 2027, for that market to kind of flatten out a little bit and then discipline to come back through. I do think there’s going to be some fairly major loss activity required in order to move that market substantively.”
Wilson concludes: “But I do think it’s beginning to flatten out because of the the acceleration in the softening that we saw in the first half of the year. So it’s a little bit less, but the storm season this year, with the very few landfalls that we’ve seen in terms of hurricane activity, I can only imagine that we’re going to have softer reinsurance, which will lead to softer conditions in the primary market.”
View information on dedicated ILS fund managers, as well as reinsurers offering ILS style investment opportunities, in our Insurance-Linked Securities Investment Managers & Funds Directory.
View all of our Artemis Live video interviews and subscribe to our podcast.
All of our Artemis Live insurance-linked securities (ILS), catastrophe bonds and reinsurance video content and video interviews can be accessed online.
Our Artemis Live podcast can be subscribed to using the typical podcast services providers, including Apple, Google, Spotify and more.
