Palomar business insurance

Overview

Palomar is a specialty insurer from La Jolla, California, that built its name on earthquake insurance and has spent the last three years turning into a broader specialty carrier. The NAIC's PALOMAR HOLDINGS GRP ranked No. 84 among U.S. business insurers by 2025 commercial lines direct premiums written, with $890.2 million, based on NAIC market share data, about 0.18% of the national commercial market. Including personal lines such as residential earthquake and Hawaii hurricane, the group wrote $1.78 billion. It is not among the 10 largest writers of any single commercial line nationally. Its biggest commercial lines in 2025 were other liability ($510.6 million), inland marine ($170.5 million), allied lines ($93.0 million) and fire ($67.0 million). The NAIC reports earthquake and crop as separate lines that fall outside the 17 commercial lines in this ranking, so the figure understates Palomar's commercial earthquake book.

The group's U.S. insurers are:

• Palomar Specialty Insurance Company: the admitted carrier, domiciled in Oregon.
• Palomar Excess and Surplus Insurance Company: the excess and surplus lines carrier, based in Phoenix, Arizona.
• First Indemnity of America Insurance Company: a New Jersey surety company bought in January 2025.
• Palomar Casualty and Surety Company: listed by Palomar as an underwriting company of its surety business since the 2026 Gray Surety deal.
• Laulima Exchange: a Hawaii reciprocal exchange that Palomar manages and that writes its Hawaii hurricane business.

Palomar also owns a Bermuda reinsurer, Palomar Specialty Reinsurance Company Bermuda, and the Palomar General Insurance Agency. The parent trades on Nasdaq under PLMR. Mac Armstrong, the founder, has been CEO since February 2014 and is chairman.

History

Palomar started in 2014 with private equity backing from Genstar Capital and a narrow thesis: catastrophe-exposed property that standard carriers underserve, especially earthquake, wind and flood. It went public on Nasdaq in April 2019, with Genstar still the majority shareholder at the time.

The recent milestones show the shift away from a pure catastrophe book:

• 2023: Palomar takes a stake in Advanced AgProtection, a Texas crop insurance MGA, and enters crop insurance through a fronting arrangement with it.
• July 2024: AM Best upgrades the group to A (Excellent) from A-.
• January 2025: Palomar completes its purchase of First Indemnity of America, a surety company founded in 1979 that bonds contractors, developers and businesses.
• April 2025: It buys Advanced AgProtection outright. The deal had been signed in March 2025.
• October 2025: It agrees to buy The Gray Casualty & Surety Company from Bernhard Capital Partners and The Gray Insurance Company for $300 million in cash.
• January 31, 2026: The Gray Surety deal closes, funded partly by a new $450 million bank facility. Palomar Surety is formed in February 2026 under Cullen Piske, who had led Gray Surety.

Management calls its current growth plan "Palomar 2X", and the surety and crop deals are part of it.

Business insurance products

Commercial earthquake and DIC. This is the product most brokers know Palomar for. It is an admitted difference in conditions policy that covers earthquake, earthquake sprinkler leakage and flood outside zones A and V, and earthquake can be written alone. It is offered in 15 states: Alaska, Arkansas, Arizona, California, Illinois, Indiana, Kansas, Kentucky, Missouri, Nevada, Oklahoma, Oregon, Tennessee, Utah and Washington. In 2026, capacity was up to $25 million in California, with a $25 million cap on total insured value, and up to $30 million elsewhere. Deductibles start around 2%. Read earthquake insurance for businesses: coverage, deductibles, limits for how these policies sit beside your property program.

Inland marine and property. Builders risk (including engineered builders risk and quota share participations), motor truck cargo, and contractor's equipment and floaters, all produced through wholesale brokers. See builder's risk insurance: covering a building while it is under construction.

Casualty. Two different books:

• General casualty for small and mid-sized artisan, commercial and residential contractors: $1 million / $2 million / $2 million primary limits, blanket additional insured wording, excess up to $5 million, and project-specific policies. It is written admitted in California, Nevada and Arizona and on surplus lines paper elsewhere. Contractors in New York, Florida, Louisiana and Georgia were excluded in 2026.
• E&S casualty, which offers up to $10 million in the working excess layers for contractors and for wrap-ups (OCIP/CCIP) on infrastructure, industrial and mixed-use projects.

Palomar also lists environmental, healthcare, real estate E&O and miscellaneous E&O products.

Surety. Contract, commercial, and site and subdivision bonds through Palomar Surety. Gray brought contract bonding for mid-sized and emerging contractors and regional offices from the Southeast and Carolinas to Texas, the West, the Upper Midwest and the Great Plains. See surety bonds explained: how they differ from insurance.

Crop and fronting. Palomar Crop sells multiple peril crop, private crop and livestock coverage through agents. PLMR-FRONT lends Palomar's admitted or surplus lines paper to MGAs, carriers and reinsurers for programs in commercial auto, workers' compensation, general liability, property, non-standard auto and warranty. See fronting arrangements and fronting carriers: how they work.

Who it insures

On the earthquake side, Palomar wants apartments and condominiums, nursing homes, shopping centers, offices, hotels, lessor's risk, light assembly manufacturing and buildings under construction. It restricts soft-story and tuck-under parking, unreinforced masonry, poor soil, pre-1956 frame and pre-1975 other construction unless retrofitted, and accounts where business income is more than 40% of value. That is a fairly clean appetite. Older retrofitted buildings can still get a look, but expect to show the engineering.

On the casualty side, the core buyer is a contractor: General contractor insurance, HVAC, electrical, plumbing, concrete, steel and painting trades. Healthcare, real estate, hospitality, manufacturing and distribution risks also appear in the E&S casualty appetite. Crop serves Farm and ranch insurance. Residential earthquake and Hawaii hurricane are personal lines, but landlords and condo associations often run into Palomar there.

How to buy

You can't buy commercial coverage from Palomar directly or online. How you reach it depends on the line:

1. Earthquake and Hawaii hurricane: through a retail agent. Palomar's "Buy Insurance" form connects you with an agent in your area.
2. Casualty and inland marine: through wholesale brokers only. A retail agent has to go through a wholesaler. Admitted casualty is available in California, Nevada and Arizona; elsewhere it is surplus lines and needs a licensed surplus lines broker.
3. Surety: through surety agents and producers.
4. Programs: through the MGA or carrier that fronts with Palomar. The program sets the rules and Palomar's name appears on the policy.

Existing policyholders use the Insured Portal to see policy details and documents, pay bills, choose paperless billing and enroll in autopay.

Claims

Report a claim through the online form at plmr.com, by email to [email protected] or by phone at 844-560-7401. The form asks for the policy number, the date and time of loss, a description and the loss location, and it takes up to three files of 50 MB each. If your policy came through a fronting program, check the declarations page and the program's claims instructions first, because the MGA or its administrator may handle claims.

For an earthquake claim, the deductible matters more than anything else. Earthquake deductibles are a percentage of insured value, often applied per building. Say, hypothetically, a building is insured for $10 million with a 5% deductible: the first $500,000 of damage is yours. Know the number before the shaking starts.

Financial strength and ratings

On September 11, 2025, AM Best affirmed the A (Excellent) financial strength rating of Palomar Specialty Insurance Company and Palomar Excess and Surplus Insurance Company with a stable outlook, and the "bbb" issuer rating of Palomar Holdings. It also affirmed First Indemnity of America at A- (Excellent) and revised that outlook to positive. AM Best called the balance sheet very strong and operating performance strong, and the business profile limited. It flagged Palomar's heavy reliance on reinsurance. In November 2025, AM Best said the Gray Surety deal did not change Palomar's ratings and put Gray's own A- under review with positive implications. Palomar's site shows the group at A (Excellent) with a stable outlook, the level set by its July 2024 upgrade.

Reinsurance is the heart of the model. At the June 1, 2026 renewal, Palomar bought earthquake reinsurance up to $3.92 billion, including $360 million from its seventh Torrey Pines Re catastrophe bond. Its per-event retentions were $20 million for earthquake and $11 million for hurricane. Laulima's Hawaii hurricane program reaches $865 million per event.

Recent results, from company releases:

• 2025: Gross written premiums rose 31.5% to $2.0 billion, the combined ratio was 76.9% and net income was $197.1 million.
• Second quarter of 2026: Gross written premiums rose 27% to $630.5 million, with a combined ratio of 83.3%.

Strengths and weaknesses

Palomar is a profitable, well-reinsured specialty carrier with real expertise in earthquake. Its newer casualty, surety and crop books are growing fast but have less history behind them.

• Strengths: It is one of the few admitted markets for standalone commercial earthquake, with up to $30 million of capacity outside California. Its A (Excellent) ratings were upgraded in 2024 and affirmed in 2025. A $3.92 billion earthquake reinsurance tower, partly funded by catastrophe bonds, sits behind the policies. It offers both admitted and surplus lines paper, and the 2025-2026 acquisitions gave it national surety reach.
• Weaknesses: It doesn't offer a package or BOP, so Palomar is a monoline piece of your program, not a one-stop market. Casualty and inland marine require a wholesale broker. AM Best rates its business profile limited and notes its dependence on reinsurance, and a major California quake would test the model. Casualty and surety were small for Palomar until 2024-2026, so its claims record there is short.

How to contact Palomar