SAFT

Safety Insurance is a focused Massachusetts-centric P&C carrier (95% MA, with NH/ME ramping) where the numbers and the filing language tell the same story: a hard market in personal auto and homeowners is finally flowing through to the bottom line. FY2025 revenue grew 12.8% to $1.26B and net income jumped 40.3% to $99.3M, driven not by volume games but by approved rate increases — the 10-K explicitly attributes premium growth to rate, citing average written premium per policy up 8.1% in Private Passenger Auto, 4.6% in Commercial Auto, and 9.7% in Homeowners. The MD&A's rate-filing table shows the rate machine is still grinding: MA Private Passenger Auto +5.3% (Jan-25), +5.1% (Jul-25), +1.3% (Jan-26); MA Homeowners +4.2% (Aug-25); Maine Commercial Auto +14.8% (Dec-25). Earned premium lags written premium, so a meaningful chunk of 2025's approved rate is still ahead of the income statement in 2026.

The balance sheet is conservatively run for an insurer. Liabilities/equity of 1.77x is low for the industry, long-term debt is just $50M against $892M of equity, cash grew 25% to $73.9M, and operating cash flow surged 51% to $194M — well above net income, consistent with a healthy reserve build during rate hardening. The A.M. Best 'A (Excellent)' rating was reaffirmed June 2025. The earnings recovery from the FY2023 trough ($18.9M) to FY2024 ($70.7M) to FY2025 ($99.3M) shows the rate cycle is doing exactly what it should after the post-pandemic loss-cost spike.