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AXIS CAPITAL HOLDINGS LTD - Quarter Report: 2025 March (Form 10-Q)


2025

2025 (in thousands)Preferred shares Common shares (par value)Additional paid-in capitalUnrealized gains (losses) on available for sale investments, net of tax:Retained earningsTreasury shares, at cost

Changes in:Accrued interest receivable ()Reinsurance recoverable on unpaid losses and loss expenses()()Reinsurance recoverable on paid losses and loss expenses  Deferred acquisition costs()()Prepaid reinsurance premiums()()Reserve for losses and loss expenses  Unearned premiums  Insurance and reinsurance balances, net()()Other items()()Net cash provided by operating activities  Cash flows from investing activities:Purchases of:Fixed maturities, available for sale()()Fixed maturities, held to maturity()()Equity securities()()Mortgage loans()()Other investments()()Equity method investments()()Short-term investments()()Proceeds from the sale of:Fixed maturities, available for sale  Equity securities  Other investments  Short-term investments  Proceeds from redemption of fixed maturities, available for sale  Proceeds from redemption of fixed maturities, held to maturity  Proceeds from redemption of short-term investments  Proceeds from the repayment of mortgage loans  
Proceeds from the purchase of other asset, net
()()
Loan advances made
()()Net cash provided by investing activities  Cash flows from financing activities:Repurchase of common shares - open market()()Taxes paid on withholding shares()()Dividends paid - common shares()()Dividends paid - preferred shares()()Net cash used in financing activities()()Effect of exchange rate changes on foreign currency cash, cash equivalents and restricted cash ()Increase in cash, cash equivalents and restricted cash  Cash, cash equivalents and restricted cash - beginning of period  Cash, cash equivalents and restricted cash - end of period$ $ 
See accompanying notes to Consolidated Financial Statements.

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AXIS CAPITAL HOLDINGS LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (CONTINUED)
FOR THE THREE MONTHS ENDED MARCH 31, 2025 AND 2024

Three months ended March 31,
2025
2024
(in thousands)
Supplemental disclosures of cash flow information:
Income taxes paid
$ $ 
Interest paid$ $ 


Supplemental disclosures of cash flow information:
2025
In 2025, $ million related to loan advances to Monarch Point Re (ISA 2023 and ISA 2024) Ltd. ("Monarch Point Re") was repaid and was treated as a non-cash activity in the consolidated statement of cash flows. In addition, $ million related to reinsurance balances payables due to Monarch Point Re under retrocession agreements and $ million related to ceded losses and loss expenses due from Monarch Point Re under retrocession agreements were settled and each amount was treated as a non-cash activity in the consolidated statement of cash flows. Further, $ million related to interest on loans advances to Monarch Point Re was received in advance and was treated as a non-cash activity in the consolidated statement of cash flows (refer to Note 14 'Related Party Transactions').
2024
In 2024, $ million related to loan advances to Monarch Point Re (ISA 2023) Ltd. ("Monarch Point Re") was repaid and was treated as a non-cash activity in the consolidated statement of cash flows. In addition, $ million related to reinsurance balances payables due to Monarch Point Re under the retrocession agreement and $ million related to ceded losses and loss expenses due from Monarch Point Re under the retrocession agreement were settled and each amount was treated as a non-cash activity in the consolidated statement of cash flows. Further, $ million related to interest on the loan advances to Monarch Point Re was received in advance and was treated as a non-cash activity in the consolidated statement of cash flows.
In 2024, $ million related to loan advances to a third-party reinsurer was repaid and $ million related to reinsurance balances payables due to the third-party reinsurer under the retrocession agreement was settled and each amount was treated as a non-cash activity in the consolidated statement of cash flows.











See accompanying notes to Consolidated Financial Statements.

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AXIS CAPITAL HOLDINGS LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.    




Significant Accounting Policies

There were no notable changes to the Company's significant accounting policies subsequent to its Annual Report on Form 10-K for the year ended December 31, 2024.


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AXIS CAPITAL HOLDINGS LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

2.    
reportable segments, insurance and reinsurance.

Insurance

The Company's insurance segment offers specialty insurance products to a variety of markets on a worldwide basis. The product lines in this segment are professional lines, property, liability, cyber, marine and aviation, accident and health, and credit and political risk.

Reinsurance

The Company's reinsurance segment provides treaty reinsurance to insurance companies on a worldwide basis. The product lines in this segment are liability, accident and health, professional lines, credit and surety, motor, agriculture, marine and aviation, and run-off lines which include catastrophe and property lines of business that the Company placed into run-off in 2022 and engineering lines of business that the Company placed into run-off in 2020.
The Company does not allocate its assets by segment, with the exception of goodwill and intangible assets.















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AXIS CAPITAL HOLDINGS LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

2.    SEGMENT INFORMATION (CONTINUED)
$$$$$Net premiums writtenNet premiums earnedOther insurance related income
Current accident year net losses and loss expenses
()()()()()()Net favorable prior year reserve developmentAcquisition costs()()()()()()Underwriting-related general and administrative expenses()()()()()()Underwriting income$$$$Net investment incomeNet investment gains (losses)()()Corporate expenses()()Foreign exchange (losses) gains()Interest expense and financing costs()()Reorganization expenses()
(1)Residential mortgage-backed securities ("RMBS") originated by U.S. government-sponsored agencies.
(2)Commercial mortgage-backed securities ("CMBS").
(3)Asset-backed securities ("ABS") include debt tranched securities collateralized primarily by auto loans, student loans, credit card receivables and collateralized loan obligations ("CLOs").
(4)Municipals include bonds issued by states, municipalities and political subdivisions.




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AXIS CAPITAL HOLDINGS LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

3.    INVESTMENTS (CONTINUED)
 $  %Due after one year through five years   %Due after five years through ten years   %Due after ten years   %    %Agency RMBS   %CMBS   %Non-agency RMBS   %ABS   %Total$ $  %At December 31, 2024MaturityDue in one year or less$ $  %Due after one year through five years   %Due after five years through ten years   %Due after ten years   %    %Agency RMBS   %CMBS   %Non-agency RMBS   %ABS   %Total$ $  %



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AXIS CAPITAL HOLDINGS LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

3.    INVESTMENTS (CONTINUED)
 $()$ $()$ $()Non-U.S. government () () ()Corporate debt () () ()Agency RMBS () () ()CMBS () () ()Non-agency RMBS () () ()ABS () () ()Municipals () () ()Total fixed maturities, available for sale$ $()$ $()$ $()At December 31, 2024      Fixed maturities, available for saleU.S. government and agency$ $()$ $()$ $()Non-U.S. government () () ()Corporate debt () () ()Agency RMBS () () ()CMBS () () ()Non-agency RMBS () () ()ABS () () ()Municipals () () ()Total fixed maturities, available for sale$ $()$ $()$ $()
(1)Asset-backed securities ("ABS") include debt tranched securities collateralized primarily by collateralized loan obligations ("CLOs").

At March 31, 2025, fixed maturities, held to maturity of $ million (2024: $ million) were presented net of an allowance for expected credit losses of $ (2024: $).

The Company's ABS, held to maturity consist of CLO debt tranched securities ("CLO Debt"). The Company uses a scenario-based approach to review its CLO debt portfolio and reviews subordination levels of these securities to determine their ability to absorb credit losses of the underlying collateral. If losses are forecast to be below the subordination level for a tranche held by the Company, the security is determined not to have a credit loss. At March 31, 2025, the allowance for credit losses expected to be recognized over the life of the Company's ABS, held to maturity was $.

To estimate expected credit losses for corporate debt securities, held to maturity, the Company's projected cash flows are primarily driven by assumptions regarding the severity of loss, which is a function of the probability of default and projected recovery rates. The Company's default and recovery rates are based on credit ratings, credit analysis and macroeconomic forecasts. At March 31, 2025, the allowance for credit losses expected to be recognized over the life of the Company's corporate debt, held to maturity was $.
Contractual Maturities
Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. ABS classified as held to maturity had a net carrying value of $ million (2024: $ million).
Corporate debt classified as held to maturity with a net carrying value of $ million (2024: $ million) is due between 1 year and 3 years. Corporate debt classified as held to maturity with a net carrying value of $ million (2024: $ million) is due between 3 years and 10 years. Corporate debt classified as held to maturity with a net carrying value of $ million (2024: $) is due after 10 years.


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AXIS CAPITAL HOLDINGS LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

3.    INVESTMENTS (CONTINUED)
 $ $()$ Preferred stocks  () Exchange-traded funds  () Bond mutual funds  () Total equity securities$ $ $()$ At December 31, 2024   Equity securitiesCommon stocks$ $ $()$ Preferred stocks  () Exchange-traded funds  () Bond mutual funds  () Total equity securities$ $ $()$ 


d)     Mortgage Loans

  %$  %Allowance for expected credit losses ()( %)()()%
Total mortgage loans held for investment
$  %$  %

The primary credit quality indicators for commercial mortgage loans are the debt service coverage ratio which compares a property’s net operating income to amounts needed to service the principal and interest due under the loan, (generally, the lower the debt service coverage ratio, the higher the risk of experiencing a credit loss) and the loan-to-value ratio which compares the unpaid principal balance of the loan to the estimated fair value of the underlying collateral (generally, the higher the loan-to-value ratio, the higher the risk of experiencing a credit loss). The debt service coverage ratio and loan-to-value ratio, as well as the values utilized in calculating these ratios, are updated quarterly.

The Company has a high quality commercial mortgage loan portfolio with a weighted average debt service coverage ratio of x (2024: x) and a weighted average loan-to-value ratio of % (2024: %).

At March 31, 2025, there was commercial mortgage loan with past due amounts where the Company is assessing exit strategies. At March 31, 2024, there were past due amounts associated with the commercial mortgage loans held by the Company.



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

3.    INVESTMENTS (CONTINUED)
% (2024: %) of the total mortgage loan portfolio, is evaluated for credit losses based on inputs unique to this sector. This assessment utilizes historical credit loss experience adjusted to reflect current conditions and management forecasts. Further, collateral dependent commercial mortgage loans (e.g., when the borrower is experiencing financial difficulty, including when foreclosure is reasonably possible or probable) are evaluated individually for credit losses. The allowance for expected credit losses for a collateral dependent loan is established as the excess of amortized cost over the estimated fair value of the loan's underlying collateral, less selling cost when foreclosure is probable.

Accordingly, any change in estimated credit losses are recognized as a change in the allowance for expected credit losses and is recorded in net investment gains (losses).

At March 31, 2025, the Company's mortgage loan portfolio had an allowance for expected credit losses of $ million (2024: $ million).

e)     Other Investments

  %Quarterly
- days
Direct lending funds  %
Quarterly(1)
daysPrivate equity funds  %n/an/aReal estate funds  %
Quarterly(2), Annually(3)
- days
Other privately held investments  %n/an/aTotal other investments$  % At December 31, 2024    Multi-strategy funds$  %Quarterly
- days
Direct lending funds  %
Quarterly(1)
daysPrivate equity funds  %n/an/aReal estate funds  %
Quarterly(2), Annually(3)
- days
Other privately held investments  %n/an/aTotal other investments$  %       
n/a - not applicable
(1) Applies to fund with a fair value of $ million (2024: $ million).
(2) Applies to fund with a fair value of $ million (2024: $ million).
(3) Applies to fund with a fair value of $ million (2024: $ million).



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AXIS CAPITAL HOLDINGS LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

3.    INVESTMENTS (CONTINUED)
multi-strategy fund holdings (2024: ) where the Company is still within the lockup period. 

At March 31, 2025, the Company had $ million (2024: $ million) of unfunded commitments as a limited partner in multi-strategy funds. Once the full amount of committed capital has been called by the General Partner of each of these funds, the assets will not be fully returned until after the completion of the funds' investment term. These funds have investment terms ranging from to the dissolution of the underlying fund.

At March 31, 2025, the Company had $ million (2024: $ million) of unfunded commitments as a limited partner in direct lending funds. Once the full amount of committed capital has been called by the General Partner of each of these funds, the assets will not be fully returned until the completion of the fund's investment term. These funds have investment terms ranging from three to and the General Partners of certain funds have the option to extend the term by up to .

At March 31, 2025, the Company had $ million (2024: $ million) of unfunded commitments as a limited partner in private equity funds. The life of the funds is subject to the dissolution of the underlying funds. The Company expects the overall holding period to be over .
At March 31, 2025, the Company had $ million (2024: $ million) of unfunded commitments as a limited partner in real estate funds. These funds include an open-ended fund and funds with investment terms ranging from to the dissolution of the underlying fund.
At March 31, 2025, the Company had $ million (2024: $ million) of unfunded commitments as a limited partner in private company investment funds focusing on financial services technology companies with an emphasis on insurance technology companies ("private company investment funds"). of these funds have investment terms of and fund has an investment term of .

f)     Equity Method Investments

During 2023, the Company paid $ million to acquire % of the common equity of Monarch Point Re (ISAC) Ltd. and Monarch Point Re (ISA 2023) Ltd., a collateralized reinsurance company formed under the laws of Bermuda as an incorporated segregated accounts company under the Incorporated Segregated Accounts Companies Act 2019, as amended (the "ISAC Act"). During 2024, the Company paid $ million to acquire % of the common equity of Monarch Point Re (ISA 2024) Ltd. During 2025, the Company paid $ million to acquire % of the common equity of Monarch Point Re (ISA 2025) Ltd., (Monarch Point Re (ISAC) Ltd., Monarch Point Re (ISA 2023) Ltd., Monarch Point Re (ISA 2024) Ltd. and Monarch Point Re (ISA 2025) Ltd., individually or collectively "Monarch Point Re").

The Company retrocedes a diversified portfolio of casualty reinsurance business to Monarch Point Re and Stone Point Credit Adviser LLC, a wholly owned subsidiary of Stone Point Capital, LLC ("Stone Point" refer to Note 14 'Related Party Transactions') serves as its investment manager. As an investor, the Company expects to benefit from underwriting fees generated by Monarch Point Re and the income and capital appreciation Stone Point seeks to deliver through its investment management services.

Monarch Point Re is not a Variable Interest Entity ("VIE") that is required to be included in the Company's consolidated financial statements. The Company accounts for its ownership interest in Monarch Point Re under the equity method of accounting.




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AXIS CAPITAL HOLDINGS LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

3.    INVESTMENTS (CONTINUED)
 million including direct transaction costs to acquire % of the common equity of Harrington Reinsurance Holdings Limited ("Harrington"), the parent company of Harrington Re Ltd. ("Harrington Re"), an independent reinsurance company jointly sponsored by the Company and The Blackstone Group L.P. ("Blackstone"). Following share tender offers in 2024 and 2023, the Company's ownership interest in Harrington increased to % and %, respectively.

Through long-term service agreements, the Company serves as Harrington Re's reinsurance underwriting manager and Blackstone serves as exclusive investment management service provider. As an investor, the Company expects to benefit from underwriting profit generated by Harrington Re and the income and capital appreciation Blackstone seeks to deliver through its investment management services. In addition, the Company has entered into an arrangement with Blackstone under which underwriting and investment related fees will be shared equally.

The Company accounts for its ownership interest in Harrington under the equity method of accounting. The Company's proportionate share of the underlying equity in net assets resulted in a basis difference of $ million which represents initial transactions costs.

g)     Variable Interest Entities

In the normal course of investing activities, the Company actively manages allocations to non-controlling tranches of structured securities which are variable interests issued by VIEs. These structured securities include RMBS, CMBS and ABS.

The Company also invests in limited partnerships which represent % of the Company's other investments. The investments in limited partnerships include multi-strategy funds, direct lending funds, private equity funds and real estate funds that are variable interests issued by VIEs (refer to Note 3(e) 'Other Investments').

The Company does not have the power to direct the activities that are most significant to the economic performance of these VIEs. Therefore, the Company is not the primary beneficiary of these VIEs. The maximum exposure to loss on these interests is limited to the amount of commitment made by the Company. The Company has not provided financial or other support to these structured securities other than the original investment.

h)     Net Investment Income

 $ Other investments  Equity securities  Mortgage loans  Cash and cash equivalents  Short-term investments  
Gross investment income
  Investment expenses()()Net investment income$ $ 



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AXIS CAPITAL HOLDINGS LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

3.    INVESTMENTS (CONTINUED)
 $     ()()()()()()() ()()(1)()()(2)() ()()$()$()
(1) Related to instances where the Company intends to sell securities or it is more likely than not that the Company will be required to sell securities before their anticipated recovery.
(2) Refer to Note 5 'Derivative Instruments'.



 $    ()  ()()$ $ 

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

3.    INVESTMENTS (CONTINUED)
 $       $ $ 

j)    Reverse Repurchase Agreements

At March 31, 2025, the Company held $ million (2024: $ million) of reverse repurchase agreements. These loans are fully collateralized, are generally outstanding for a short period of time and are presented on a gross basis as part of cash and cash equivalents in the Company's consolidated balance sheets. The required collateral for these loans is either cash or U.S. Treasuries at a minimum rate of % of the loan principal. Upon maturity, the Company receives principal and interest income. The Company monitors the estimated fair value of the securities loaned and borrowed on a daily basis with additional collateral obtained as necessary throughout the duration of the transaction.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

4.    

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AXIS CAPITAL HOLDINGS LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

4.    FAIR VALUE MEASUREMENTS (CONTINUED)



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

4.    FAIR VALUE MEASUREMENTS (CONTINUED)



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

4.    FAIR VALUE MEASUREMENTS (CONTINUED)




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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

4.    FAIR VALUE MEASUREMENTS (CONTINUED)
 $ $ $— $ Non-U.S. government   —  Corporate debt   —  Agency RMBS   —  CMBS   —  Non-agency RMBS   —  ABS   —  Municipals   —      —  Equity securitiesCommon stocks   —  Preferred stocks   —  Exchange-traded funds   —  Bond mutual funds   —      —  Other investmentsMulti-strategy funds     Direct lending funds     Private equity funds     Real estate funds     Other privately held investments          Short-term investments   —  Other assets
Derivative instruments (refer to Note 5)
   —  Total Assets$ $ $ $ $ Liabilities
Derivative instruments (refer to Note 5)
$ $ $ $— $  Total Liabilities$ $ $ $— $ 




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AXIS CAPITAL HOLDINGS LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

4.    FAIR VALUE MEASUREMENTS (CONTINUED)

 $ $ $— $ Non-U.S. government   —  Corporate debt   —  Agency RMBS   —  CMBS   —  Non-agency RMBS   —  ABS   —  Municipals   —      —  Equity securitiesCommon stocks   —  Preferred stocks   —  Exchange-traded funds   —  Bond mutual funds   —      —  Other investmentsMulti-strategy funds     Direct lending funds     Private equity funds     Real estate funds     Other privately held investments          Short-term investments   —  Other assets
Derivative instruments (refer to Note 5)
   —  Total Assets$ $ $ $ $ Liabilities
Derivative instruments (refer to Note 5)
$ $ $ $— $ Total Liabilities$ $ $ $— $ 



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AXIS CAPITAL HOLDINGS LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

4.    FAIR VALUE MEASUREMENTS (CONTINUED)
 Discounted cash flowDiscount rate%%Default rate%%Loss absorption yield%%Estimated maturity date
- year
year
(1) Realized gains (losses) on fixed maturities and realized and unrealized gains (losses) on other assets and other liabilities included in net income are included in net investment gains (losses). Realized and unrealized gains (losses) on other investments included in net income are included in net investment income.
(2) Unrealized gains (losses) on fixed maturities are included in other comprehensive income ("OCI").
(3) Change in unrealized gains (losses) relating to assets and liabilities held at the reporting date.


Transfers into Level 3 from Level 2

There were transfers into Level 3 from Level 2 during the three months ended March 31, 2025 and 2024.

Transfers out of Level 3 into Level 2

There were transfers out of Level 3 into Level 2 during the three months ended March 31, 2025 and 2024.



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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

4.    FAIR VALUE MEASUREMENTS (CONTINUED)


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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

4.    FAIR VALUE MEASUREMENTS (CONTINUED)
 million (2024: $ million) and a fair value of $ million (2024: $ million). The fair values of these securities are determined using a model which uses prepayment speeds and spreads sourced primarily from the new issue market. As the significant inputs used to price these securities are observable market inputs, their fair values are classified as Level 2.

At March 31, 2025, the carrying value of mortgage loans, held for investment, approximated fair value. The fair values of mortgage loans are primarily determined by estimating expected future cash flows and discounting them using current interest rates for similar mortgage loans with similar credit risk or are determined from pricing for similar loans. As mortgage loans are not actively traded, their fair values are classified as Level 3.

At March 31, 2025, the Company's debt was recorded at amortized cost with a carrying value of $ million (2024: $ million) and a fair value of $ million (2024: $ million). The fair value of the Company's debt is based on prices obtained from a third-party pricing service and is determined using the spread above the risk-free yield curve. These spreads are generally obtained from the new issue market, secondary trading and broker-dealer quotes. As the yields for the risk-free yield curve and the spreads are observable market inputs, the fair value of this debt is classified as Level 2.

At March 31, 2025, Federal Home Loan Bank advances were recorded at amortized cost with a carrying value of $ million (2024: $ million) and a fair value of $ million (2024: $ million). As these advances are not actively traded, their fair values are classified as Level 2.

























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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

5.    


 $ $ $ $ $ Relating to underwriting portfolio:Foreign exchange forward contracts      Total derivatives$ $ $ $ 
(1)Derivative assets and derivative liabilities are classified within other assets and other liabilities in the consolidated balance sheets.

The notional amounts of derivative contracts represent the basis on which amounts paid or received are calculated and are presented in the above table to quantify the volume of the Company's derivative activities. Notional amounts are not reflective of credit risk.

None of the Company's derivative instruments are designated as hedges.

Offsetting Assets and Liabilities

The Company's derivative instruments are generally traded under International Swaps and Derivatives Association master netting agreements which establish terms that apply to all transactions. In the event of a bankruptcy or other stipulated event, master netting agreements provide that individual positions be replaced with a new amount, usually referred to as the termination amount, determined by taking into account market prices and converting into a single currency. Effectively, this contractual close-out netting reduces credit exposure from gross to net exposure.

 $()$ $ $()$ Derivative liabilities$ $()$ $ $()$ 
(1)Net asset and liability derivatives are classified within other assets and other liabilities in the consolidated balance sheets.

Refer to Note 3 'Investments' for information on reverse repurchase agreements.

a) Relating to Investment Portfolio

Foreign Currency Risk

The Company's investment portfolio is exposed to foreign currency risk. Therefore, the fair values of its investments are partially influenced by changes in foreign currency exchange rates. The Company may enter into foreign exchange forward contracts to manage the effect of this foreign currency risk. These foreign currency hedging activities are not designated as specific hedges for financial reporting purposes.


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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

5.    DERIVATIVE INSTRUMENTS (CONTINUED)
)$ Foreign exchange (losses) gains ()$ $()


Estimates for Significant Catastrophe Events

At March 31, 2025, net reserves for losses and loss expenses included estimated amounts for numerous catastrophe events. The magnitude and complexity of losses arising from certain of these events inherently increase the level of uncertainty and, therefore, the level of management judgment involved in arriving at estimated net reserves for losses and loss expenses. These events include California Wildfires in 2025, Hurricane Milton and Hurricane Helene in 2024. As a result, actual losses for these events may ultimately differ materially from current estimates. During the three months ended March 31, 2025, the Company recognized catastrophe and weather-related losses, net of reinsurance, of $ million (2024: $ million).


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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

6.    RESERVE FOR LOSSES AND LOSS EXPENSES (CONTINUED)
 $ Reinsurance  Total$ $ 

The following sections provide further details on net favorable (adverse) prior year reserve development by segment, reserve class and accident year:

Insurance Segment:


 $ 
Casualty
  
Specialty other
 ()Total$ $ 
2025
For the three months ended March 31, 2025, net favorable prior year reserve development of $ million was recognized, the principal component of which was: 
•$ million of net favorable prior year reserve development on property business primarily due to better than expected loss emergence mainly related to the 2023 accident year.

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6.    RESERVE FOR LOSSES AND LOSS EXPENSES (CONTINUED)
was recognized, the principal components of which were: 
•$ million of net favorable prior year reserve development on property business primarily due to better than expected loss emergence mainly related to the 2021 and 2022 accident years.
•$ million of net adverse prior year reserve development on the specialty other reserve class primarily associated with an increase in the loss estimate attributable to a specific large claim in the marine and aviation line of business related to the 2019 accident year.
Reinsurance Segment:
 $ 
Specialty
  
Run-off
  Total$ $ 
2025
For the three months ended March 31, 2025, net favorable prior year reserve development of $ million was recognized.
2024
For the three months ended March 31, 2024, net prior year reserve development of $ was recognized.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

7.    
 $   $ $   $ $ $ $       $ $   
n/a - not applicable

Beginning share price: The beginning share price for awards was based on the average closing share price over the trading days preceding and including the start of the performance period.

Ending share price: The ending share price was based on the average projected closing share price over the trading days preceding and including the end of the performance period.

Expected term: Performance for awards granted in 2025 is measured from January 1, 2025 to December 31, 2027, and performance for awards granted in 2024 is measured from January 1, 2024 to December 31, 2026.

Expected volatility: The expected volatility is estimated based on the Company's historical share price volatility.

Expected dividend yield: The expected dividend yield is not applicable to the performance restricted stock units as dividends are paid at the end of the vesting period and do not affect the value of the performance restricted stock units.

Risk-free interest rate: The risk-free rate is estimated based on the yield on a U.S. treasury zero-coupon bond issued with a remaining term equal to the vesting period of the performance restricted stock units.

Compensation expense associated with performance restricted stock units granted in 2025 and 2024 is determined on the grant date based on the fair value calculated by the Monte Carlo simulation model, and is recognized on a straight-line basis over the requisite service period.

Performance Restricted Stock Units granted in 2025 and 2024 with a performance condition

The fair value of these performance restricted stock units was determined based on the closing price of the Company's common shares on the grant date. Compensation expense is recognized on a straight-line basis over the requisite service period and is subject to periodic adjustment based on the achievement of established performance criteria during the performance period.










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AXIS CAPITAL HOLDINGS LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

8.    SHARE-BASED COMPENSATION (CONTINUED)
 $  $      Granted    
Performance adjustment (1)
         Vested() ()      Forfeited  () Non-vested restricted stock units - end of period $  $ 
performance period that ended in 2024. The performance restricted stock units were granted at the target level of achievement.

 $ 
Tax benefits associated with share-based compensation expense
$ $ 
Fair value of restricted stock units vested(1)
$ $ Unrecognized share-based compensation expense$ $ Expected weighted average period associated with the recognition of unrecognized share-based compensation expense years years
(1) Fair value is based on the closing price of the Company's common shares on the vest date.
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AXIS CAPITAL HOLDINGS LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

9.    
  Shares issued  Total shares issued at end of period  Treasury shares, balance at beginning of period()()Shares repurchased()()Shares reissued   Total treasury shares at end of period()()Total shares outstanding  
Treasury Shares
On February 6, 2025, authorization under the Company's Board-authorized share repurchase program for common share repurchases approved in May 2024 was exhausted.
On February 19, 2025, the Company's Board of Directors approved a new share repurchase program for up to $ million of the Company's common shares. The new share repurchase program is open-ended, allowing the Company to repurchase its shares from time to time in the open market or privately negotiated transactions, depending on market conditions.
  Total cost$ $ 
Average price per share(2)
$ $ 
From employees:(3)
Total shares  Total cost$ $ 
Average price per share(2)
$ $ Total shares repurchased:Total shares  Total cost$ $ 
Average price per share(2)
$ $ 
(1) Shares are repurchased pursuant to the Company's Board-authorized share repurchase programs.
(2) Calculated using whole numbers.
(3)  Shares are repurchased from employees to satisfy personal withholding tax liabilities that arise on the vesting of share-settled restricted stock units.









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AXIS CAPITAL HOLDINGS LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

9.    SHAREHOLDERS' EQUITY (CONTINUED)

 $ $    Series E preferred shares$ $ $ Three months ended March 31, 2024   Common shares$ $ $    Series E preferred shares$ $ $ 





(1)Presented at net carrying value of $390 million (2024: $443 million) in the consolidated balance sheets.
(2)Includes restricted cash and cash equivalents of $576 million and $920 million at March 31, 2025 and at December 31, 2024, respectively.




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Overview

The fair value of total investments decreased by $510 million in the three months ended March 31, 2025, as market value gains, reinvestment of interest income and cashflows from operations were offset by an increase in cash and cash equivalents.

An analysis of our investment portfolio by asset class is detailed below:

Fixed Maturities

Details of our fixed maturities portfolio are as follows:
  March 31, 2025December 31, 2024
  Fair Value% of TotalFair Value% of Total
Fixed maturities:
U.S. government and agency$2,553,843 21 %$2,802,986 22 %
Non-U.S. government714,525 6 %729,939 6 %
Corporate debt4,750,703 37 %4,957,807 39 %
Agency RMBS1,557,554 13 %1,184,845 9 %
CMBS856,108 7 %819,608 7 %
Non-agency RMBS189,739 2 %122,536 1 %
ABS1,554,608 13 %1,860,966 15 %
Municipals(1)
72,227 1 %110,817 1 %
Total$12,249,307 100 %$12,589,504 100 %
Credit ratings:
U.S. government and agency$2,553,843 21 %$2,802,986 22 %
AAA(2)
2,483,839 20 %2,665,334 21 %
AA
2,665,026 21 %2,354,372 19 %
A2,053,447 17 %2,090,516 17 %
BBB1,167,845 10 %1,190,381 9 %
Below BBB(3)
1,325,307 11 %1,485,915 12 %
Total$12,249,307 100 %$12,589,504 100 %
(1)Includes bonds issued by states, municipalities, and political subdivisions.
(2)Includes U.S. government-sponsored agencies, residential mortgage-backed securities ("RMBS") and commercial mortgage-backed securities ("CMBS").
(3)Non-investment grade and non-rated securities.

At March 31, 2025, fixed maturities had a weighted average credit rating of A+ (2024: A+), a book yield of 4.5% (2024: 4.5%), and an average duration of 3.0 years (2024: 2.8 years). At March 31, 2025, fixed maturities together with short-term investments, cash and cash equivalents (i.e. total investments of $15.7 billion) had a weighted average credit rating of AA- (2024: AA-) and an average duration of 2.4 years (2024: 2.5 years).

At March 31, 2025, net unrealized losses on fixed maturities, available for sale were $132 million, compared to net unrealized losses of $267 million at December 31, 2024, a decrease of $135 million due to the improvement in market values and realized losses associated with sales in the period.

Equity Securities

At March 31, 2025, net unrealized gains on equity securities were $36 million, compared to $59 million at December 31, 2024. The decrease of $23 million was driven by the decline in market values and realized gains associated with sales in the period.

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Mortgage Loans

At March 31, 2025, investment in commercial mortgage loans was $458 million, compared to $506 million at December 31, 2024. The decrease was driven by four loans which were repaid in full during the three months ended March 31, 2025. The commercial mortgage loans are high quality, and collateralized by a variety of commercial properties and diversified geographically throughout the U.S. and by property type to reduce the risk of concentration. At March 31, 2025, the allowance for credit losses of $26 million, was primarily related to commercial properties exposed to the office sector.

Other Investments

Details of our other investments portfolio are as follows:
March 31, 2025December 31, 2024
  Fair Value% of TotalFair Value% of Total
Multi-strategy funds$16,625 2 %$24,919 3 %
Direct lending funds167,425 18 %171,048 18 %
Private equity funds329,542 35 %320,690 35 %
Real estate funds291,564 31 %291,640 31 %
Total multi-strategy, direct lending, private equity and real estate funds
805,156 86 %808,297 87 %
Other privately held investments133,406 14 %121,981 13 %
Total other investments$938,562 100 %$930,278 100 %

Refer to Note 3(e) to the Consolidated Financial Statements 'Investments'.

Equity Method Investments

Our ownership interests in Harrington Reinsurance Holdings Limited ("Harrington") and Monarch Point Re (ISAC) Ltd., Monarch Point Re (ISA 2023) Ltd., Monarch Point Re (ISA 2024) Ltd. and Monarch Point Re (ISA 2025) Ltd. (individually or collectively "Monarch Point Re") are reported in interest in income (loss) of equity method investments. Refer to Note 3(f) to the Consolidated Financial Statements 'Investments'.




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LIQUIDITY AND CAPITAL RESOURCES

Refer to the ‘Liquidity and Capital Resources’ section included in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024 for a general discussion of liquidity and capital resources.

The following table summarizes consolidated capital:
March 31, 2025December 31, 2024
Debt$1,315,555 $1,315,179 
Preferred shares550,000 550,000 
Common equity5,352,799 5,539,379 
Shareholders’ equity5,902,799 6,089,379 
Total capital$7,218,354 $7,404,558 
Ratio of debt to total capital18.2 %17.8 %

We finance our operations with a combination of debt and equity capital. The debt to total capital ratio provides an indication of our capital structure, along with some insight into our financial strength. We believe that our financial flexibility remains strong. Adjustments are made if developments occur that are different from previous expectations.
Federal Home Loan Bank Advances

The Company's subsidiaries, AXIS Insurance Company and AXIS Surplus Insurance Company, are members of the Federal Home Loan Bank of Chicago ("FHLB").

At March 31, 2025, the companies had admitted assets of approximately $3.1 billion (2024: $3.2 billion) which provides borrowing capacity of up to approximately $787 million (2024: $798 million).

At March 31, 2025, the Company had borrowings under the FHLB program of $66 million (2024: $66 million).

The FHLB advances have maturities in 2025 and 2026 and interest payable at interest rates between 4.5% and 4.9% (2024: interest rates between 4.5% and 5.5%). The Company incurred interest expense of $1 million (2024: $1 million) for the three months ended March 31, 2025. The borrowings under the FHLB program are secured by cash and investments with a fair value of $71 million (2024: $72 million).

Line of credit

On March 23, 2025, the $300 million Facility was amended to extend the tenors of issuable letters of credit to March 31, 2027.



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Common Equity
During the three months ended March 31, 2025, common equity decreased by $187 million. The following table reconciles opening and closing common equity positions:
Three months ended March 31,2025
Common equity - opening$5,539,379 
Share-based compensation expense9,800 
Change in unrealized gains on available for sale investments, net of tax
115,337 
Foreign currency translation adjustment(156)
Net income
194,071 
Preferred share dividends(7,563)
Common share dividends(35,593)
Treasury shares repurchased(464,505)
Treasury shares reissued2,029 
EURGBPJPYOtherTotal
1,050 $10,370 $(1,199)$811 $(1,325)$11,515 
† Filed herewith.
* Management contract, compensatory plan or arrangement.

The agreements and other documents filed as exhibits to this report are not intended to provide factual information or other disclosure other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by us in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Dated: April 30, 2025
 
AXIS CAPITAL HOLDINGS LIMITED
By:
/S/ VINCENT TIZZIO
Vincent Tizzio
President and Chief Executive Officer
(Principal Executive Officer)
/S/ PETER VOGT
Peter Vogt
Chief Financial Officer
(Principal Financial Officer)


































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